http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/RSS.ashxAUSY Registration Document 2011 PagesTue, 12 Jun 2012 18:37:21 +0200http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1REGISTRATION DOCUMENT INCLUDING THE ANNUAL FINANCIAL REPORT 20112012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=2http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=2CONTENT PROFILE MESSAGE FROM THE PRESIDENTDEPUTY CHIEF EXECUTIVE OFFICER 2 3 1 2 3 4 GROUP PRESENTATION 1.1. Key figures 1.2. History 1.3. Strategy 1.5. Activities 1.6. The Company’s societal responsibilities 1.7. Risk factors AFR 5 6 8 10 13 17 21 5 6 7 8 COMPANY FINANCIAL STATEMENTS 5.1. Balance sheet AFR AFR AFR 91 92 93 94 107 108 5.2. Income statement 1.4. The strategic challenge of Human Resources 12 5.3. Notes to the financial statements 5.4. Key figures for the last five years 5.5. Statutory Auditors’ Report AFR CORPORATE GOVERNANCE 2.1. Board of Directors 2.2. Interests and remuneration 2.3. Chairman of the Board’s report on corporate governance, internal control procedures and risk management 2.4. Statutory auditor's report of the chairmain of the board 23 24 28 INFORMATION ON THE COMPANY AND THE SHARE CAPITAL 6.1. Information on the Company 6.3. Shareholders AFR AFR AFR 109 110 114 120 125 6.2. Information on the share capital 6.4. Investor information 35 44 GENERAL MEETING 7.1. Agenda 7.2. draft resolutions 7.3. Statutory Auditors’ special report on regulated agreements and commitments 127 128 129 135 COMMENTS ON THE 2011 FINANCIAL YEAR 3.1. Activity analysis and consolidated results 3.2. AUSY Income 3.3. Comments on subsidiaries 3.4. Investments 3.5. Dividends AFR 45 46 49 51 53 53 ADDITIONAL INFORMATION 8.1. Publicly available documents 8.2. Those responsible for the document 8.3. Auditors and fees 8.4. Index of the Registration Document AFR 139 140 140 141 143 146 147 149 CONSOLIDATED FINANCIAL STATEMENTS AFR 4.1. Consolidated balance sheet 4.2. Consolidated income statement 4.3. Other comprehensive income items 4.4. Consolidated cash flow statement 4.6. Notes to the financial statements 4.7. Information on the pro forma statements 4.8. Statutory Auditor's report AFR 55 56 57 58 59 61 83 89 8.5. Concordance of the annual financial report 8.6. Concordance of the annual Management Report 8.7. Concordance of CSR info 4.5. Consolidated statement of changes in equity 60 Elements of the Annual Financial Report are identified by the AFR pictogram2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=3http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=3REGISTRATION DOCUMENT This document includes the annual financial report 2011 This AUSY 2011 Registration Document was filed with the Autorité des Marchés Financiers (French Financial Markets Authority, or AMF) on April 26 2012, in accordance with article 212-13 of that body’s General Regulations. It may be used in support of a financial transaction only if supplemented by an offering circular duly certified by the AMF. This document has been prepared by the Issuer and engages its signatories’ responsibility. Furthermore, pursuant to Article 28 of European Commission Regulation 809/2004, the following items are included for reference purposes in this Registration Document: The corporate and consolidated financial statements at December 31st 2010, as well as our Statutory Auditors’ related reports, which are set out on pages 110 to 151 of Registration Document D. 11-0416 filed with the AMF on April 29th 2011; The corporate and consolidated financial statements at December 31st 2009, together with our Statutory Auditors’ related reports, as set out on pages 99 to 136 of Registration Document D-10-0275 filed with the AMF on April 16th 2010. 2011 Registration Document - AUSY 12012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=4http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=4PROFILE Excellence and international dimension AUSY is a leading European company specializing in High Technology and Engineering. It is listed on the NYSE Euronext Paris, Compartment C. Ausy concentrates on two balanced core businesses, Information Systems and complex Industrial Systems. The Group is focused around three concepts, "Vision, Exactness, Commitment", as the basis for building the company year after year and guiding all acquisitions. Accredited as an "Innovative Company", by the OSEO, AUSY optimizes and supports its customers through all project phases and across the entire product life cycle, in France and abroad. exactness commitment vision 2 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=5http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=5MESSAGE FROM THE CHAIRMAN AND CHIEF EXECUTIVE OFFICIER AND FROM THE DEPUTY CHIEF EXECUTIVE OFFICER The Leap Forward 2011 was a very defining year for the AUSY group. The year translated into a true leap forward since it allowed an increase in revenue of nearly 50%. This was largely the result of 3 external growth transactions which together represent 100 million euro in revenue on a full year basis: • the APTUS group consolidated since February 1st and present in France and Spain; • the APX-AS activity integrated on April 1st in the Rhône-Alpes region; • the ELAN Group consolidated on July 1st and present in Germany and Spain. Concomittant with the integration of these 3 structures, the Group pursued its organic growth strategy of more than 10.3% over the year and created two new international establishments, in the United Kingdom and India, bringing their number to 7 at the end of the year as compared with 3 at the beginning of 2011. In addition, in order to provide itself with the means to pursue its ambitions during the coming years, the Group reinforced its financial structure through a capital increase and control of capital by the managers and two new financial partners acting in concert When one looks at the trajectory followed by the Group since the announcement of the first development plan five years ago, the transformation is striking: • revenue multiplied by 3.4; • operating profit multiplied by 5; • net revenue multiplied by 7. The tendency demonstrates a reinforcement of the "work packages" and international activity. During the second half of 2011: • the international share represents 25% of the Group as compared with 9% in 2006; • the share of work-packages represents 40% of total activity as compared with 15% in 2006. At the end of 2011, the AUSY group shows a truly new face with a one year lead on very ambitious goals for growth. Its 4 priorities for 2012 shall be the following : • propagate its dynamic of assessing margins on new perimeters; • reassure its sectorial positions; • reinforce its geographic positions; • prepare the next development plan which will commence in 2013, the principal axis of which will be the acceleration of international development. 2011 Registration Document - AUSY 32012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=6http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=64 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=7http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=71 Group presentation 1.1. 1.2. KEY FIGURES HISTORY 1989-2012: controlled growth 6 8 8 1.3. STRATEGY AVENIR 2012, an ambitious and realistic strategy Robust and controlled growth Offering more International deployment Quality Management 10 10 10 10 10 11 1.4. THE STRATEGIC CHALLENGE OF HUMAN RESOURCES Recruitment centered on generating growth AUSY University: teaching AUSY skills and culture 12 12 12 1.5. ACTIVITIES Aiming for balance AUSY’s top ten customers Changes in the High Tech market Local takes on a new dimension Licensing (trademarks, patents and branch offices) 13 13 14 14 15 16 1.6. THE COMPANY’S SOCIETAL RESPONSIBILITIES RISK FACTORS 17 21 1.7. 2011 Registration Document - AUSY 52012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=8http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=81 Group presentation Key figures 1.1. KEY FIGURES FINANCIAL INDICATORS (Published Data) Operating income (in €k) 21,311 18,968 Current operating income (in €k) 14,059 10,604 7,970 5,704 5,704 8,728 14,635 9,644 2007 2008 2009 2010 2011 2007 2008 2009 2010 2011 Net income, Group share (in €k) Operating cash flow in €M (before taxes and debt financing costs) 21.8 13,427 14 11.6 8,019 6,186 4,607 3,189 6.5 8.5 2007 2008 2009 2010 2011 2007 2008 2009 2010 2011 6 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=9http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=9Group presentation Key figures 1 16% Bank/Finance/ Insurance OPERATING INDICATORS Revenue (in €k) 197.7 153.8 138.1 293.8 Breakdown of revenue by sector 2% Other 20% Services/Transport 4% Health/Medical 7% Energy/Environment 24% 27% Telecom/Multimedia Aero/Space/Defense 108.9 Breakdown of Revenue by business 2007 2008 2009 2010 2011 Headcount 3,630 2,300 2,060 1,700 1,572 52% Industrial Systems 48% Information Systems Geographical breakdown of revenue 21% International 79% France 2007 2008 2009 2010 2011 Certifications Qualité ISO 9001 V 2008 EN9100 (note de 100/100) CMMI niveau 3 AUSY labellisé « Entreprise innovante » par l’OSEO Innovation 2011 Registration Document - AUSY 72012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=10http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=101 Group presentation History 1.2. HISTORY 1989-2012: controlled growth 1999 IPO on the Paris Stock Exchange’s Second market on April 30th 1999 to enhance its renown, diversify its financing sources and facilitate its European expansion plans. First expansion abroad with the creation of AUSY Benelux, based in Brussels. 2002 ISO 9001 2000 version Certification. 1989 1999 2001 2002 2004 Change of management. 1989 8 2011 Registration Document - AUSY 2001 2004 Founding of AUSY on December 18th 1989 by JeanMarie MAGNET, the current Chairman and Chief Executive Officer, through an LBO (Leverage Buyout). The Company specializes in technological IT and has three initial sites – Paris, Lyon and Rennes AUSY confirms its European ambition with the acquisition of On Site Group as well as the Belgian and Luxembourg subsidiaries of the Actif France Group. Continued expansion of its commercial network in France with the opening of new sites. 2005 Issue of €4.6M in OCEANEs maturing on March 15th 2010. 20052012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=11http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=11Group presentation History 1 2007 2010 Launch of the CAP 2009 expansion plan. First external growth operation as part of the CAP 2009 strategy with the acquisition, in July, of Aequalis, a consulting and IT engineering firm. Equity warrant issue. Launch of the AVENIR plan, whose first goal is to reach a turnover of €300m and 4,000 employees in 2012. 2006 2007 2009 2010 2011 AUSY is accredited “Innovative Company” by OSEO Innovation and becomes eligible for the FCPI (high-tech mutual fund). Creation of Pentalog Technology in December, a joint venture whose share capital is evenly split between AUSY and Pentalog High Tech. This firm bolsters AUSY’s Nearshore offer in Romania. CAP 2009 Plan finalized with four external growth transactions: • February 2009: purchase of a division of ESL Technologies, which specializes in design; • March 2009: acquisition of Axylog, specializing in Wireless technologies, followed by the transfer of its entire portfolio of assets and liabilities to AUSY on July 1st 2009; • July 2009: goodwill acquisition of EMI, a company specializing in scientific calculus for the aeronautical industry; this activity is operated under lease by Exalen Technologies in order to expand and strengthen its offer in the Mechanical sector; • August 2009: acquisition of the Belgian company, Bow Communication, and its subsidiary, Data Flow Consultancy, to reinforce AUSY’s presence in Belgium and Luxembourg. €28M OBSAAR issue with the last maturity date in 2014. New certifications: • CMMI level 3; • EN9100 certification for the Paris and Toulouse Industry Operations, with a score of 100/100 achieved on the EN9100 evaluation questionnaire. First phase of the AVENIR plan with three major external growth transactions: • February 2011: acquisition of all the capital in the APTUS group; • April 2011: acquisition of APX-AS in the Rhône Alpes region, with some 130 employees working in Information Systems; • July 2011: acquisition of 51% of the German group, ELAN, with which AUSY had rolled out solutions for the aeronautics industry for several years as part of an ELAN AUSY joint venture. Rights issue of €15M (March 2011) retaining preferential subscription rights. Signature of a €32M syndicated loan contract. 2006 2009 2011 2012 2012 2011 Registration Document - AUSY 92012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=12http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=121 Group presentation Strategy 1.3. STRATEGY While endeavoring to reduce the number of their suppliers, AUSY’s key accounts expect their selected partners to be able to support them in all their growth plans. They demand more quality, increased availability and higher added value, all at the lowest cost. In the space of a few years, AUSY has acquired the mass and skills required to be listed as a top-tier supplier with all its customers. Its strategy clearly aims to develop the Group’s positions and margins by anticipating and supporting demand from principals in France and abroad. AVENIR 2012, an ambitious and realistic strategy In an uncertain economic climate, AUSY successfully carried through the CAP 2009 Plan and posted revenue in excess of €150M, employing over 2,000 people. The target under the new AVENIR plan, unveiled in March 2010, is to double the Company’s size within three years, thus achieving €300M in revenue and employing 4,000 people. The acquisitions of APTUS, APX-AS and ELAN in 2011 went a long way towards achieving these ambitious but altogether realistic goals. The challenge of integrating these additions is one that AUSY has mastered through its experience and the organization it has created in recent years. Offering more The demands for service provision based on work-packages has increased to meet customers’ need to create added value and reduce costs. AUSY anticipated this development with demand for technical assistance giving way to committed results contracts, and has strengthened its centers of expertise and its organization. Taken overall, work-packages now account for 40% of AUSY’s 2011 revenue. Backed by its mature expertise in project management, in terms of both resources and results, APTUS procures new resources for the Group and cements its expertise. The Group Projects’ Management (GPM) consolidates and oversees all work-package projects making sure they are profitable. It steers all expertise and production centers at Group level, in France and internationally. It is accountable for ensuring consistent and relevant technical solutions, while optimizing costs by pooling resources (sharing premises, hardware, infrastructure, software, etc.). The model developed by AUSY ensures real-time responsiveness between the sales and technical front office (i.e. project steering next door to customers) and the back office located in AUSY’s service centers. AUSY’s management is based on principles that promote efficient integration of new acquisitions: • listen; • respect cultural/structural/functional differences; • knowledge of and adaptation to local demands (market, technologies and business model); • management restructuring and oversight of all performance, productivity and profitability markers; • new sales dynamic, tight teamwork and trust in the local teams; • operational departments’ skill in communications and synergy to deliver comprehensive support for customers; • profitability increase. International deployment The Group’s ability to deepen its international footprint is a key aspect of AUSY’s strategy in the coming years. An international presence meets the need for customers to reconcile proximity, added value, quality and cost optimization by working with a single partner. The past few years saw AUSY strengthen its positions and build strategic partnerships to seize these new growth opportunities. Its 2011 acquisitions add a new dimension to this expansion strategy with its subsidiary in Spain. ELAN is mainly centered in Germany with an additional presence in the Spanish market. • A tried-and-tested model Thanks to its skills transfer agreements, AUSY offers solutions to a major concern of industrial customers, particularly in the Aerospace sector. The International division, created in 2009, is the point of contact between the Development and Strategy Management and the GPM. It enables an optimal use of resources and expertise centers in the countries concerned. Robust and controlled growth2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=13http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=13Group presentation Strategy 1 To assist its clients internationally AUSY primarily relies on the “Nearshore” zone. Since it includes countries such as Romania, this zone offers advantages particularly suited to French companies: • Francophone teams; • geographical proximity; • identical time zones; • local engineers’ level of education and technical qualities. Further afield, the “Offshore” zone, which includes countries such as India, offers other advantages: • lower payroll costs; • large numbers of engineers available for projects that require high mobilization of resources; • high level of education in software engineering. The Group’s international offer packages its processes and quality systems as well as its high performance requirements with firm local steering and in-house resource development. GPM has a dedicated offshore contact person in constant communication with Quality Management to ensure consistency. Quality Management Certification bolsters the Company’s image and credibility with its current and potential client base, providing an objective assessment of the quality of the products and services on offer. For AUSY, certifications are also a means of supporting its strategy and anticipating future developments. According to a Pierre Audouin Consultant study, AUSY is one of the most highly certified companies in its market. Its Quality Management System demonstrates the Group’s commitment to continually improving its business model and its ambition to provide, wherever it is geographically present, a consistent quality of service across all business lines and transnational projects. • AUSY’s response to market demands All AUSY’s French sites are certified ISO 9001 V2008, which is renewed each year. Since 2009, the Paris and the South-West Region Operations Division (SWR) are certified CMMI maturity level 3, a level rarely achieved by companies in France. This process-improvement approach for software and systems engineering is recognized worldwide and is in particular demand in the aeronautics industry. The Paris and the South-West Region Operations Division (SWR) also obtained EN9100 certification, scoring 100/100, the gold standard for quality in design, development, production, installation and maintenance for the aerospace and defense industries. • Integration and rollout of best practices Certification in the Group serves to harmonize practices by systematizing consistent quality commitments. AUSY is thus extending the scope of its certifications in line with its expansion. The Sophia-Antipolis and Aix-en-Provence sites are included in ISO certification. The Exalen Technologies subsidiary was accredited ISO 9001 for Nantes, and EN9100 for Toulouse and Paris. For new acquisitions, certification is the expression of a shared culture, which helps facilitate integration, reflected in ELAN’s EN9100 certification in the aeronautics sector, due to be renewed, like AUSY’s, in 2012. APTUS has CEFRI radiological protection certification. The Group’s international expansion is the latest challenge for the AUSY quality system to ensure it meets the needs of its customers throughout the world. 2011 Registration Document - AUSY 112012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=14http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=141 Group presentation The strategic challenge of Human Resources 1.4. THE STRATEGIC CHALLENGE OF HUMAN RESOURCES Recruitment centered on generating growth The ability to detect, recruit and retain the best talent is one of the keys to AUSY’s success. These recruitment principles are required to meet the Group’s growth expectations. Hiring criteria are extremely selective – even elitist for certain profiles – since excellence alone makes the difference and ensures that we meet customers’ demands. With an unerring eye for quality, AUSY consistently looks ahead and prepares for its future hiring needs. The Group has built lasting relationships with ten or so French engineering colleges (both in Paris and regionally) and participates in their recruitment drives and fairs, and similarly, invites them to its recruitment events. The Group’s engineers regularly participate in their training, thus giving students access to AUSY’s expertise (development of practical case studies covering operational/functional topics), and informing them about career opportunities within the Group, particularly in their own regions. Recruitment is decentralized in each Operational Division in order to favor the flexibility and responsiveness of a structure capable of adapting in real time to the activity, the sought-after profiles and of creating true opportunities and career development. In 2011, the Group welcomed almost 1,000 new employees from APTUS, APX-AS and ELAN and added 1,100 new hires to its headcount. AUSY University: teaching AUSY skills and culture AUSY’s engineers are the Group’s ambassadors to its customers. In terms of Human Resources policy, and thus for AUSY, the main challenge is to reinforce the link between its consultants and their Company. In addition to an Intranet offering real-time access to the latest Company news, communication is through a range of actions related to daily monitoring of projects by managers, as well as actions at Group level (branch meetings, events organized by regional divisions or by the Group). However, the fundamental factor in creating Group cohesion and team loyalty is AUSY University. This continuing education structure has proved its mettle over the years and plays an essential role in affirming and sharing the AUSY corporate culture. AUSY University creates and implements ambitious and top-level training programs, recognized by its partners and clients. It is accredited as an organisme de formation reconnu (french accredited training body) by the French Government. Developed by the Group’s experts, these programs set out to offer all employees the opportunity to develop their technical expertise, to follow through on their professional career aims, learn about new managerial practices, or fulfill a personal development goal. 2011 saw the creation of an induction course known as “APWay” (for AUSY Personal Way) for consultants as an introduction to the Company and to provide the foundation for their role as effective ambassadors. 12 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=15http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=15Group presentation Activities 1 1.5. ACTIVITIES Aiming for balance • Information Systems/Industrial Systems: duality confirmed AUSY concentrates on two complementary core businesses – Information Systems and Industrial Systems. The almost equal split between the two (52% in R&D and 48% in IS) is an AUSY specificity and one of the fundamental elements of its strategy. Since both business lines are susceptible to changes in the market at different times and in different ways, the balance between them gives the Group an “acyclic” advantage, i.e. with low sensitivity to market variations. As a result, AUSY has expanded with greater ease, as is evident from its organic growth in 2009, during a downturn for the entire sector. Information Systems In the Management IT field, AUSY works on corporate cross-function applications (accounting, invoicing, inventory and payroll) as well as on specific issues (such as asset management). Our clients’ strategic goals – increasing market share, more in-depth knowledge of their potential customers, implementing targeted or more responsive operational marketing – require the most advanced technologies and are all areas covered by our technical and functional experts. AUSY’s Infrastructure business offers the ideal complement: consulting and technical expertise on Information Systems infrastructure. This high-level expertise in both security and display is invaluable in supporting key accounts in their transition to cloud computing. Market driven by new trends Substantial growth opportunities reside in online sales and betting. Banks are looking for more reliable financial product management tools and more confidential data management. Furthermore, banking infrastructure needs more and more maintenance and the inevitable flow of new technologies requires thorough and complex reorganizations. Dynamism in a fiercely competitive sector will come from the quest for mobility and convergence between media, issues of availability and on-demand access, and new augmented-reality technologies. Industrial Systems Backed by over 20 years of experience in the design of Complex Industrial Systems, AUSY is a major player in the cutting-edge industrial projects sector. Awarded the “Innovative Company” label by OSEO, and CIR accredited, the Group counts the main players in industry, technological innovation and science among its customers. It has the expertise to support customers through all phases of their products’ life cycle, from the specification phase, through design, industrialization and production, up to the approval phase. AUSY has developed a range of multi-sector business-line offers, such as: • on-board software; • mechanics; • systems engineering; • telecommunications; • energy. Evolving needs National defense spending in Europe is declining, while the spend in cyber security and simulation is set to rise. The energy market is driven by a combination of spiraling demand, increasing resource scarcity and the search for new forms and uses of energy. In the telecommunications sector, the main growth drivers (according to the European Information Technology Observatory, EITO) will be voice recognition and, above all, mobility with ever-increasing use of smartphones and high-speed connections. 2011 Registration Document - AUSY 132012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=16http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=161 Group presentation Activities • Balance for growth The balanced distribution of its business between the industrial and services sectors is guaranteed by AUSY’s dual offer. In 2011, the integration of APTUS, APX-AS and ELAN strengthened the Group’s positions, while safeguarding this balance. AUSY’s flagship sectors are Aeronautics/Space/Defense, closely followed by Telecommunications/ Multimedia, and Banking/Finance/Insurance. Energy/Environment are growing apace, and a new Health/Medical sector is emerging. Although the Group’s top ten customers accounted for 44% of turnover in 2011, none exceeded the 10% turnover threshold, thereby considerably reducing the financial dependence risk while ensuring significant growth prospects within their separate entities in France and abroad. Changes in the High Tech market In the wake of the downturn in 2008 and 2009, the early signs of recovery in 2010 in the information services sector may be more mixed than expected. While it is true that needs exist and companies cannot delay investment indefinitely, the absence of economic growth and the rigors of austerity policies may lead to even more selectivity. Pierre Audouin Consultants expect a marked slowdown in the integration consulting segment, while outsourcing is expected to remain dynamic. The public sector will be in decline in 2012 and the Banking and Telecommunications sectors, which grew strongly in 2011, could adopt a more prudent attitude as growth remains stagnant. The ongoing financial crisis may accentuate this trend. Overall, Pierre Audouin Consultants expects the French market to grow an average of 2.9% in 2012, down from the 3.6% growth rate of 2011. AUSY’s top ten customers 2010 1 2 3 4 5 6 7 8 9 10 AMADEUS THALES ST MICROELECTRONICS 2011 EADS FRANCE TELECOM AMADEUS THALES SAFRAN ST MICROELECTRONICS BELGACOM SOCIÉTÉ GÉNÉRALE BNP PARIBAS ALCATEL 44% Main players in the technology consulting market in France (excluding systems integrators) • AUSY’s competitors in Information Systems are extremely diverse: Alten, Business et Décision, Cadextan, Cap Gemini, GFI, Keyrus, Sopra and Steria. • In Industrial Systems, its competitors include: Akka, Altran, Alten, SII and Assystem. EADS SAFRAN FRANCE TELECOM BELGACOM BNP PARIBAS SOCIÉTÉ GÉNÉRALE ALCATEL 49% AUSY has created a specific dynamic for its key accounts, relayed in each Operational Management by the sales teams. The GAM/KAM (Global Account Manager and Key Account Manager) are supervised by the Sales Departments in each country and focus on long-term, key-client development. This structure is responsible for putting this development plan into action. It is effective in renewing AUSY’s listing with existing customers and in gaining new market share. 14 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=17http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=17Group presentation Activities 1 Local takes on a new dimension • Consolidation of regional bases In France, AUSY’s territorial coverage includes 19 sites located close to its customers’ decision centers. 2011 saw some changes in size, with the integration of APTUS, APX-AS and ELAN. They reinforced their positions with customers in common and added to their array of skills, for example in the energy, medical and health businesses, or in banking, finance and telecommunications. This process creates a virtuous circle to drive growth, leveraging their size to become benchmark players and thereby positioning them to take on large-scale projects, enhance their reputation locally and attract the best talent. • More robust positions in Europe Benelux United Kingdom Germany Spain • Nearshore gathers momentum Romania Tunisia • Greater capacity to deepen our international footprint India EDAG and Atkins partnerships extending to 15 countries. 2011 Registration Document - AUSY 152012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=18http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=181 S Group presentation Activities Licensing (trademarks, patents and branch offices) • Trademarks and patents The AUSY Group owns the following trademarks: AUSY ELAN, registered on September 28th 2011. The AUSY ELAN trademark has been registered on a national and international basis for the following countries: the Benelux countries, Denmark, Finland, Norway, the United Kingdom, Sweden, Switzerland, Germany, Tunisia and India. S S AUSY, registered on July 13th 2001, and renewed on December 24th 2010. The AUSY trademark has been registered on a national and international basis for the following countries: the Benelux countries, Denmark, Finland, Norway, the United Kingdom, Sweden, Switzerland, Germany, India, Tunisia and Spain. Furthermore, the AUSY Group has registered 75 domain names, primarily relating to the AUSY, APTUS, Exalen and AUSY ELAN names. In addition, it is specified that the ausy.xxx domain name is subject to lifelong protection. Lastly, the trademarks and assets required for the Company’s business activities are wholly-owned. ELAN AUSY, registered on September 28th 2011. The ELAN AUSY trademark has been registered on a national and international basis for the following countries: the Benelux countries, Denmark, Finland, Norway, the United Kingdom, Sweden, Switzerland, Germany, Tunisia and India. • Branch Offices The AUSY Group operates in leased premises: S S Exalen Technologies, registered on January 5th 2009. The Exalen Technologies trademark has been registered on a national basis. S in France, in branch offices located in Issy-les-Moulineaux, Rennes, Nantes, Lille, Toulouse, Lyon, Strasbourg, Orléans, Aix-en-Provence, Niort, Bordeaux, Nice, Grenoble, Caen, Lannion, and Tours; at the international level, the Group has operations in Germany, the Benelux countries, the United Kingdom, Spain, Romania, Tunisia and India. S APTUS – Engineering Consulting, registered on October 5th 2001, and renewed on September 21st 2011. The APTUS trademark has been registered on a national basis. 16 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=19http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=19Group presentation The Company’s societal responsibilities 1 1.6. THE COMPANY’S SOCIETAL RESPONSIBILITIES Employee-related information • Employment Total headcount and new hires, distinguishing between fixedterm contracts and open-term contracts, and assessing potential recruitment difficulties, redundancies and their causes, overtime, and staff external to the Company At December 31st 2011, the Group’s headcount was 3,630 employees, including 2,980 employees in France. The Group hired 1,100 people in France in 2011, as follows: Open-ended contracts Fixed-term contracts Trainees TOTAL 1,077 7 16 1,100 Remuneration and its trend, social security charges, application of the provisions of the French Labor Code relating to incentive payments, profit-sharing, and employee share savings schemes, and professional equality between men and women. The overall cost of work (payroll, social security charges and taxes on salaries) amounted to €139,808 ,930 in 2011, compared with €104,616,152 in 2010. At the same time, the average headcount was 2,399 employees in 2011 compared with 1,837 in 2010. • Employee relations and Collective Agreement Review All Group companies implement an active policy of dialogue with their social partners. The AUSY Works Council met 12 times during 2011. Meetings were organized between staff representatives and management at all the premises on a monthly basis. Furthermore, several negotiating processes were launched, involving: the NAO (French Mandatory Annual Negotiation), health in the workplace, and professional equality between men and women. In 2011: S S 31 people were made redundant in France; 9,111 hours of overtime were worked in France. AUSY welcomed 36 temporary workers, which is the equivalent of six full-time jobs. These temporary employment contracts only involved organizational positions. Use of sub-contractors amounted to the equivalent of 359.17 full-time jobs in France in 2011. Where appropriate, information regarding headcount reduction and employment protection schemes, reclassification efforts, and rehiring and support measures None. • Social activities The AUSY Works Council dedicated a budget equal to 0.14% of the payroll, i.e. €129,294, in addition to an operating budget equal to 0.2% of the payroll, i.e. €184,705, on social and cultural activities. Relations with social insertion organizations, educational institutions, voluntary organizations, environmental protection organizations, consumer associations and neighboring populations As part of its recruitment policy (engineers and graduates with five years of university education), AUSY has formed partnerships with various engineering schools and universities throughout France. The partnerships are of various kinds: S S S S S S S S S S • Working time organization This item concerns the organization and length of working time for full-time and part-time employees, and absenteeism and its causes. AUSY applied a collective working time of 36.5 hours per week with nine days of work-time recuperation leave (RTT) for 2011. The number of part-time employees amounted to 67 people, working mainly (64%) between 20 and 30 hours per week. Absenteeism in number of days is shown below, according to the cause: Paid leave Working-time recuperation Unpaid leave Illness Work-related absence Maternity leave Paternity leave Authorized absences Family events 45,913 17,730 4,571 9,704 360 3,025 870 1,508 646 educational talks on technical modules; conferences (on the role of a Technical Director); management classes (company foundation); student project monitoring; event sponsoring (ECE Directive); mock interviews with our recruitment specialists in all our partner schools; examination juries; school forums; payment of the apprenticeship tax; school promotion sponsorship project. 2011 Registration Document - AUSY 172012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=20http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=201 • Training Group presentation The Company’s societal responsibilities • Health and safety Thirteen meetings of the Hygiene, Safety and Working Conditions Committee (HSWCC) were held at AUSY in 2011. AUSY identified only a very low number (14) of workplace accidents in 2011. Lastly, management signed a company agreement on preventing and treating stress in the workplace with most of its representative trade union organizations on December 8th 2011. S improve its practices, with a view to safeguarding the environment on an ongoing basis. To support this momentum, a sustainable development steering Committee was set up in September 2011, under the responsibility of the AUSY General Secretariat. This Committee brings together the main Departments or Cross-Departmental Services that deal with the issue (Legal Affairs and Tax, General Services, Employee Affairs, Quality Assurance, Communications, and Recruitment). The Committee meets at regular intervals, in order to define the priorities and strategic guidelines of the Sustainable Development Policy, and approves initiatives and/or projects and related resources. An operating Committee co-ordinates, implements and monitors the various approved initiatives, and reports on their progress to the steering Committee. Meanwhile, the various projects are directed by a project head (who represents one of the Departments), who must commit to deadlines and deliverables, as for any other project. To date, these systems have not been the subject of official certification; however the overall thinking, the way in which the announced principles have been drawn up and their implementation rely on ISO 26000: 2010. This international standard provides guidelines on the underlying principles of societal responsibility, on identifying that responsibility, and on discussions with stakeholders regarding core issues and action points relating to societal responsibility, as well as on the means of incorporating responsible behavior into the organization. It highlights the significance of the results and the performance improvements achieved in terms of societal responsibility. AUSY spent an amount greater than the legal obligation of 1.6% of its payroll on professional training in 2011. The training policy applied at the Company aims to promote the training of consultants in new technologies so that we have real experts among our workforce, who match our customers’ requirements. In addition, the AUSY University, an accredited training body, introduced targeted training programs for consultants and for the management tier. • Diversity and equal opportunities AUSY, which is convinced that social mix and diversity genuinely contribute to effectiveness, modernity and innovation within the Company, decided to launch an action plan to promote professional equality between men and women, which was signed on December 8th 2011. In this plan, the Company set out the principles that must be applied in order to respect and develop equality of opportunities and treatment between men and women, at all stages of their professional careers. Furthermore, the Company applies all legal provisions in force regarding employing disabled people and keeping them in employment, primarily by changing the layout of workstations (adaptation of working tools). In 2011, the Company had 16 disabled workers among its workforce, eight of whom joined the Company in 2011. It should be specified that this number is undoubtedly lower than the reality, since some employees do not inform their employer of their disability. The Company applied its policy to encourage employing disabled workers to its general purchasing policy, by using Assistance through Work Institutions and Services (ESATs) wherever possible, and by systematically including these organizations in any tender for printing requirements or the purchasing of supplies in the communications area. • Examples of projects carried out in 2011 December 2011 S S Signing of the Health in the 2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=21http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=21Group presentation The Company’s societal responsibilities 1 the right to be heard. The best way to determine the relevance or the importance of an interest consists in considering its link to Sustainable Development. The AUSY Group has therefore undertaken to identify its stakeholders, and to determine its area of influence. CLIENTS EMPLOYEES SUB-CONTRACTORS PARTNERS Trade unions Statutory Auditors GOVERNMENT SUPPLIERS Occupational Medicine Recruitment website Shareholders Lawyers Insurance Cos HSWCC SCHOOLS Applicants Employee Representatives AUSY University Communication Agencies ISSY Lessors The Medias EC Banks • Example of an interest and/or influence-based relationship with a stakeholder As part of its recruitment policy, AUSY forms partnerships with various engineering schools and universities throughout France. The Group builds partnerships, which may be of several kinds (educational talks on technical modules, conferences, management classes). Environmental information To reduce its impact on the environment, the organization must adopt an integrated approach, which takes into account the direct and indirect implications of its decisions and business activities from an economic, social, health and environmental standpoint. It is necessary to identify options that encourage the reduction and elimination of non-viable volumes, production and consumption methods, and to ensure that the consumption of resources per head becomes sustainable. Dealing with environmental issues, which are closely interwoven, both at the local and global level, requires a global, systematic and collective approach. • Sub-contracting and suppliers The Company and the Group use sub-contracting as part of the fulfillment of contracts. Sub-contracting amounted to 13.77% of revenue in France in 2011, and to 19.32% of Group revenue. Furthermore, regarding the significance of sub-contracting and the way in which the Company promotes the fundamental ILO guidelines to its sub-contractors and ensures that the latter comply with them, it is specified that AUSY ensure that its subsidiaries or partners comply with the international ILO guidelines. To this end, it inserts the corresponding contractual clauses into the documents that govern the obligations between the parties, and specifically ensures that articles L. 8221-3, L. 8221-5, and L. 8251-1 of the French Labor Code are complied with. • General environmental policy The organization must therefore not only comply with legislation and regulations, but must also assume responsibility for the impact of its business activities on the environment in rural and urban areas, and on the environment in its broader sense. Given the ecological limitations, the organization must take action to improve its own performance, as well as the performance of others in its area of influence. Moreover, when it makes purchasing decisions, the organization must take the environmental, social and ethical performance of the acquired products and services into account, throughout their life cycle. If possible, the organization must favor products and services that limit the impact as much as possible. 2011 Registration Document - AUSY 192012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=22http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=221 S S S S S S Group presentation The Company’s societal responsibilities In addition, the organization must raise awareness and promote appropriate education, in order to support environmental efforts within the organization and its area of influence. Boosted by these principles, the AUSY Group has chosen to raise employee awareness of safeguarding the environment, by reminding them of simple daily gestures, which enable them to contribute towards the protection of the environment. Every employee can contribute to this initiative, which aims to be civic and voluntary. AUSY gives each employee an Eco-Responsibility handbook, in order to share its thinking on this issue with its employees. As a result, AUSY encourages its employees to: use less paper; optimize printing, and re-use used paper; recycle paper (introduction of recycling bins); recycle consumables (introduction of recycling bins); use low-energy light bulbs; configure all the equipment in energy-saving mode, etc. • Pollution and waste management The organization can improve its environmental performance by preventing pollution, including atmospheric discharges of pollutants like lead and mercury and of other substances that damage the ozone layer. The organization may have an impact on the environment and health that affects people in varying ways. Its business activities may generate liquid or solid waste, which may result in the contamination of the air, water, ground, soil, and outside spaces if not managed properly. Responsible waste management seeks to avoid producing waste. It must respect waste reduction guidelines, including reduction at source, re-use, recycling and re-treatment, and the treatment and scrapping of waste. Paper accounts for a large share of the waste produced in everyday activities. The AUSY Group, which is conscious of its direct or indirect impact, has drawn up a general environmental policy (see previous point), and has specifically planned a Greenhouse gas report for 2012, and provided for the Carbon Offsetting of its annual management seminar in 2013. AUSY has implemented: S • Contribution to adapting to and combating climate change Not applicable. a car and company car policy that enables consistent and environmentally-friendly car fleet management, through selecting less polluting cars; a video-conferencing system to avoid unnecessary travel. • Protecting biodiversity Not applicable. S 20 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=23http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=23Group presentation Risk factors 1 1.7. RISK FACTORS The Company has performed a review of the risks that may have a material unfavorable effect on its business activities, its financial position, its results, or on its ability to achieve its targets, and considers that there are no other significant risks than those set out below. Therefore, the following features will be specified for each risk identified: • the relationship between the business activity performed and the identified risk; • the monitoring and management of the risk identified; • the discounting of the risk identified, where applicable. transactions, such as universal asset transfers, and requests for the transfer of losses, etc. The Company was the subject of a tax audit this year, covering the 2008 and 2009 financial years. It has received a notice of adjustment involving an amount of €83,290 in this respect. This amount was the subject of a provision in the 2011 financial statements. As part of the management and monitoring of the legal risks identified above, the Group records a provision every time that a risk amounts to an obligation towards a third party, where the potential liability likely to result can be estimated with sufficient accuracy, following consultations with and the recommendations of the Legal and Tax Department, and a financial assessment of the risk by the Finance Department. Excluding the provisioned litigation, there are no other government, court or arbitration proceedings, including any pending or threatened proceedings of which the Company is aware, that are likely to have, or have had any significant effect on the Company and/or the Group’s financial position or profitability over the past 12 months. No additional legal risks have emerged since December 31st 2011. Legal risks Given its business activities, the Group is likely to run the following legal risks: • legal risk relating to the execution of its customer or supplier contracts: this may involve non-compliance with contractual commitments relating to contracts under performance obligations. The majority of services are still billed on the basis of time spent. Risks linked to fixed-rate business activities remain low, and are controlled. Therefore the valuation of fixed-rate projects in the financial statements includes potential risks. Moreover, the Group’s internal organizational structure allows the operational players’ responsibilities and powers to be defined through the application of the ISO standards that have been introduced. New projects are submitted to the “Go-No-Go” Committee, which is responsible for approving or turning down a contract. As part of monitoring the execution of AUSY’s projects, there is a monthly project management and monitoring Committee, whose role is to conduct a detailed review of all the projects in progress. Lastly, in order to prevent any litigation, the Contractual Integrity Document provides instructions for managing any pre-litigation situation; • employee risk is primarily reflected in the risks relating to retaining staff. In our business sector, the staff consists mainly of qualified engineers, and the Group’s ongoing success depends to a large extent on its ability to recruit staff who have the necessary skills and experience. In this respect, the Group is exposed to the risk of seeing its customers or competitors offer job opportunities to its employees, following a particularly successful collaboration. In order to manage this risk in a better way, the Group has implemented a staff-retention policy that it is continually improving. Furthermore, the Group is also likely to incur risks as part of its relations with individual employees. A total provision of €914k was booked as at December 31st, 2011 (compared with €2,057k in 2010) for all of the Group’s outstanding litigation. The Group set up a separate Employee Affairs Department in 2011. This Department manages the conflicts relating to individual and collective employee relations, and is assisted 2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=24http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=241 Group presentation Risk factors AUSY does not envisage becoming involved in abnormal working situations in the context of its customer advisory and research assignments. If a radiation accident occurs at one of its clients’ premises, AUSY staff must immediately apply the safety guidelines that have been given to them. No additional industrial and environmental risks have emerged since December 31st 2011. Market risk (exchange rate and foreign exchange risk) All the Group’s medium-term financing (credit lines and bonds redeemable for equity subscription and/or purchase warrants (OBSAAR)) has resulted in its entering into swaps that enable the interest rate to be fixed. The Group only uses factoring financing for very short periods (less than one month), and is not subject to interest rate risk in this respect. Given the above factors, the residual risk for the Company is very low. No additional interest rate risk has emerged since December 31st 2011. Most of the transactions performed by AUSY are restricted to Europe, and are billed in euros. The foreign exchange risk is considered as insignificant. This assessment will be reviewed in 2012, given the Group’s ongoing expansion outside the euro zone (UK and India). No additional foreign exchange risk has emerged since December 31st 2011. Credit and/or counterparty risks The Group’s clientele was mainly composed of key accounts at December 31st 2011: the Group’s top ten clients accounted for 44% of revenue. Virtually all customer receivables are transferred to a factoring company, which reflects the high quality of the clientele. No additional credit and/or counterparty risks have emerged since December 31st 2011. Operational risks Given its business activities, the Group may be exposed to the risk of losses upon completion of a fixed-rate project. This risk is managed via: • the setting up of a Committee charged with approving the acceptance of each project; • weekly monitoring of each project’s progress; • a monthly financial control. At December 31st 2011, the Group recorded a provision of €204k for losses on completion of fixed-rate contracts. No additional operational risks have emerged since December 31st 2011. Insurance The AUSY Group benefits from insurance policies subscribed with companies that are manifestly solvent, and covering the main risks linked to its business activities. The Legal Affairs and Tax Department has set up the following guarantees within the Group: • Third-Party Operating and Professional Liability: This policy insures the Group in respect of third-party operating liability, i.e. the harm caused to the insured party’s staff, the consequent material and immaterial damage, and the non-consequent immaterial damage, as well as accidental environmental damage, in line with the Group’s concern to pursue an eco-friendly approach. The third-party product liability covers damage to entrusted goods, and damage resulting from computer viruses; Liquidity risk Liquidity risk is the risk that the Group cannot meet its financial obligations. The Group’s approach to managing this risk is to permanently ensure that the Group has sufficient funds to meet its Liabilities when they mature. The Finance Division implemented a provisional cash flow monitoring system for each operational entity of the Group which allows that division to manage liquidity risk with sufficient visibility. As at the closing date of the accounts, the Group does not have any liquidity risk since the amount of gross cash exceeds current financial liabilities as of the closing date. Within the framework of debt linked to OBSAAR and the syndicated bank loan, AUSY SA is bound by agreements (structured financing and servicing of debt). As of December 31st, 2011, these agreements are respected. Since December 31st, 2011, there are no additional liquidity risks. • Aviation and Aerospace Products Insurance; • Third-Party Liability for Corporate Officers; • Comprehensive Casualty Insurance; • Repatriation Assistance2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=25http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=252 Corporate governance 2.1. BOARD OF DIRECTORS 24 28 28 34 2.2. INTERESTS AND REMUNERATION 2.2.1. Corporate Officers’ remuneration 2.2.2. Summary of securities transactions performed by Corporate Officers 2.3. CHAIRMAN OF THE BOARD’S REPORT ON CORPORATE GOVERNANCE, INTERNAL CONTROL PROCEDURES AND RISK MANAGEMENT 2.3.1. Corporate Governance 2.3.2. Internal control and risk management procedures Conclusion of the Chairman's report 35 35 40 43 2.4. STATUTORY AUDITOR'S REPORT OF THE CHAIRMAIN OF THE BOARD 44 2011 Registration Document - AUSY 232012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=26http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=262 S S Corporate governance Board of Directors 2.1. BOARD OF DIRECTORS As of December 31st, 2011, the Board of Directors had seven members: Mr. Jean-Marie MAGNET, Director, CEO; To the Company’s knowledge and as of the date of drafting this Registration Document, none of the members of the Board of Directors or of Executive Management, have been, over the past 5 years: S S S S Jean-Marie MAGNET started his career at Sogeti then at Cap Sogeti before joining the IBSI Group where he was appointed Group CEO in 1985. In 1989, he created the AUSY Group which he has led for 20 years. Mr. Philippe MORSILLO, Director, Deputy CEO; Convicted of fraud; Associated with a bankruptcy, receivership or liquidation; Subject to an official public proceeding or sanction by a statutory or regulatory authority; Disqualified by a Court from acting as a member of an Issuer’s administrative, management or supervisory bodies or from acting in the management or conduct of the affairs of an Issuer. Philippe MORSILLO held the position of CEO in New Technology Consulting firms prior to being appointed the AUSY Company’s Deputy CEO in 2004. S Mr. Fabrice DUPONT, Director, Company Secretary General; Fabrice DUPONT started his career in retail banking prior to joining Euronext in 1997, then a brokerage firm where he set up the Equity Capital Market department. After having held the position of Company Secretary in a new technology consulting firm, he was appointed as AUSY’s Company Secretary in 2007. S To the Company’s knowledge and as of the date of drafting this Registration Document, there are no potential conflicts of interest between the members of the Board of Directors or of Executive Management with respect to their duties to the Company as Corporate Officers and their private interests or other duties. To the Company’s knowledge and as of the date of drafting this Registration Document, there is no arrangement or agreement signed with the main shareholders, clients or suppliers under the terms of which a member of the Board of Directors or of Executive Management was selected. To the Company’s knowledge and as of the date of drafting this Registration Document: S Mr. Joël MAGNET, Director; Joël MAGNET was a sales person for the Nixdorf and then the Head of Sales for CSI prior to joining AUSY. He left his salaried positions in 2006. S Mr. Sven KADO, Director; Sven KADO started his career with the KPMG group, where he was a Tax auditor and consultant. He then worked in the banking industry and subsequently in the New Technology sector when he joined the Nixdorf Computer group as CFO. He continued his career in the UK, Germany, the Czech Republic and Poland to carry out External Growth transactions and large-scale privatization projects. Since 2000, he chairs the Marsh & Mc Lennan group in Germany, focusing on restructuration and acquisitions transactions. S Messrs. MAGNET, MORSILLO, DUPONT, FILLON and PELTE, respectively members of the Board of Directors and/or Executive Management, decided to submit the sale of their holdings in the Company’s Capital to the terms of the Shareholders’ agreement finalized on July 24th, 2009, amended on September 24th, 2009 and March 1st, 2011 between Messrs. MAGNET, MORSILLO, DUPONT, FILLON, PELTE, SIPAREX MIDMARKET II, SIPAREX MIDCAP I, and the Direct 2 co-investment fund; Messrs MAGNET, MORSILLO, DUPONT and FILLON, respectively members of the Board of Directors and/or Executive Management, decided to submit the sale of their holdings in the Company’s Capital to the terms of the Shareholders’ agreement finalized on March 1st, 2011 between MM. MAGNET, MORSILLO, DUPONT, FILLON, SIPAREX MIDMARKET II, SIPAREX MIDCAP I, and Direct 2 co-investment fund This agreement provides for a holding period for shares of HISAM, subject to cases of free/unrestricted transfer and subject to the lock up period of said agreement. Ms. Martine CHARBONNIER, Director. S Martine CHARBONNIER was a financial analyst with Fidal (1982), in charge of developm2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=27http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=27Corporate governance Board of Directors 2 Number of shares held on 12/31/2011 1,195,479 To the Company’s knowledge and as of the date of drafting this Registration Document: S Messrs MAGNET, MORSILLO, DUPONT et FILLON, respectively members of the Board of Directors and/or Executive Management are bound to AUSY through a non-competition clause authorized by the Board of Directors on March 23rd, 2011 for Messrs MAGNET and MORSILLO and signed February 25th, 2011 for Messrs. DUPONT and FILLON. Messrs. MAGNET, MORSILLO, DUPONT and FILLON, respectively members of the Board of Directors and/or Management are bound to AUSY through a good leaver/bad leaver agreement entered into on April 1st, 2011 which governs the terms of their departure from AUSY. To the Company’s knowledge and as of the date of drafting this Registration Document, there is no service contract binding the members of the Board or of Executive Management to the Issuer or any of its subsidiaries and setting out an award of benefits at the end of such contract. S The duties and functions performed by the corporate officers of AUSY are the following: Conseil d’administration Mandate Name Jean-Marie MAGNET Age Nationality Positions Director Appointment GM 12/18/1989 Re-appointment GM 6/24/1992 GM 6/24/1998 GM 6/03/2004 GM 6/17/2010 BM 6/24/1992 BM 6/24/1998 BM 6/30/2004 BM 6/17/2010 BM 6/17/2010 GM 6/24/1992 GM 6/24/1998 GM 6/30/1994 GM 6/17/2010 - Expiring 2016 GM 67 years French President CEO BM 12/18/1989 (President of the Board) BM 7/2/2002 (CEO) GM 6/8/2006 BM 9/28/2004 GM 6/9/2008 GM 12/18/1989 2016 GM Philippe MORSILLO Fabrice DUPONT Joël MAGNET 47 years French Director Associate CEO 2012 GM 2016 GM 2014 GM 2016 GM 150,000 45 years French 54 years French Director Company Secretary Director 1 42 Sven KADO 67 years German Director Director Director GM 6/15/2009 GM 6/14/2011 GM 6/14/11 2015 GM 2017 GM 2017 GM - Martine 54 years French CHARBONNIER Benoît METAIS 48 years French The duties and positions held by the corporate officers and directors outside AUSY SA are the following: Jean-Marie MAGNET Company AUSY Positions Director Appointment GM 18.12.89 Re-appointment AG 24/06/1992 AG 24/06/1998 AG 30/06/2004 AG 17/06/2010 BM 6/24/1992 BM 6/24/1998 BM 6/20/2004 BM 6/17/2010 BM 6/6/2006 GM 6/6/2006 BM 6/6/2006 BM 3/27/2009 - Expiring AG 2016 Executive Chairman BM 12/18/1989 (Chairman of the Board of Directors) CA 7/2/2002 (CEO) BM 12/26/2002 GM 3/5/2001 BM 6/3/2001 BM 12/26/2002 BM 3/9/2006 BM 3/9/2006 2016 GM AUSY Belgium Chairman of the Board of Directors Director Day-to-day management 2012 GM 2012 GM 2012 GM 2012 GM 2012 GM AUSY Luxembourg PSF SA Chairman of the Board of Directors Director Day-to-day management 2011 Registration Document - AUSY 252012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=28http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=282 Company AUSY AUSY GmbH AUSY UK LTD Corporate governance Board of Directors Philippe MORSILLO Positions Director Associate CEO AUSY Belgium Director Day-to-day management AUSY Luxembourg Director Day-to-day management Managing Director Director Director Appointment GM 6/8/2006 BM 9/08/2004 BM 6/17/2016 BM 3/30/2007 BM 3/30/2007 BM 3/30/2007 BM 3/30/2007 AG notarized 5/3/2010 8/07/2010 8/30/2011 GM 5/18/2011 Re-appointment - Expiring 2012 GM 2016 GM 2012 GM 2012 GM 2012 GM 2012 GM Indefinite Indefinite Indefinite Indefinite AUSY Technologies India AUSY Sole Administrator Servicios de Ingenieria Fabrice DUPONT Company AUSY Positions Director Member of the Audit Committee Appointment CGM 6/9/2008 BM 3/23/2011 BM 4/7/2010 8/07/2010 AG notarized 5/3/2010 AG notarized 9/15/2011 Document notarized on 9/14/2011 Re-appointment - Expiring 2014 GM 2014 GM 2012 GM Indefinite Indefinite AUSY Luxembourg AUSY UK LTD AUSY GmbH ELAN AUSY GmbH AUSY Servicios de Ingenieria SL Director General Secretary Power of Attorney (Prokurist) Power of Attorney (Prokurist) Power of Attorney Indefinite Joël MAGNET Company AUSY Director 18/12/1989 Positions Appointment Re-appointment GM 6/24/1992 GM 6/24/1998 GM 6/30/2004 GM 6/17/2010 Expiring 2016 GM Sven KADO Company AUSY Fonction Director Chairman of the Audit Committee Nomination 6/15/2009 BM 3/23/2011 2000 Renouvellement - Fin 2015 GM 2015 GM - Marsh & Mc Lennan Allemagne Executive Chairman Martine CHARBONNIER Company AUSY Positions Director Member of the Audit Committee Appointment GM 6/14/2011 BM 6/14/2011 GM 5/18/2011 GM 11/09/2011 GM 3/23/2011 GM 5/20/2009 Re-appointment - Expiring 2017 GM 2017 GM 2017 GM 2017 GM 2013 GM 2015 GM SOMFY DAMARTEX ALTAMIR Amboise SHAN Member of Supervisory Committee Member of Supervisory Committee Member of Supervisory Committee Director 26 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=29http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=29Corporate governance Board of Directors 2 Expiring 2015 GM 2016 GM 2013 GM 2015 GM 2013 GM 07/04/2011 2013 GM 2013 GM N/A 2013 GM N/A 2017 GM 2013 GM Benoît METAIS Company SICAME Croissance Nergeco EUROTAB Botanic Positions SIGEFI Representative to Supervisory Committee SIGEFI Representative to Supervisory Committee SIGEFI Representative to Supervisory Committee SIGEFI Representative to Supervisory Committee Appointment 12/22/2009 9/24/2001 8/01/2001 11/28/2002 Re-appointment 6/11/2004 6/18/2010 3/30/2007 2/03/2006 2/27/2009 2/01/2012 6/29/2007 6/26/2010 - Rhône Alpes PME Gestion Groupe KELLER (Financière KI) SIGEFI Representative to Supervisory Committee SIGEFI Representative to Supervisory Committee 6/15/2010 12/21/2004 6/19/2006 11/23/2007 9/02/2010 3/20/2008 8/01/2009 08/31/2010 6/14/2011 6/09/2004 10/27/2008 Financière AMADEUS SIGEFI Representative to Supervisory Committee Bernadet SAS UFG-Siparex SIGEFI PARTNERS SIGEFI JST GROUPE AUSY SES IBERIA PE Siparex Italia Private Equity SIGEFI Representative to Supervisory Committee SIGEFI Representative to Supervisory Committee Director Director SIGEFI Representative to Supervisory Committee Director SIGEFI Representative to Supervisory Committee Director AG on 4/17/2012 2011 Registration Document - AUSY 272012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=30http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=302 TABLE 1 Corporate governance Interests and remuneration 2.2. INTERESTS AND REMUNERATION 2.2.1. Corporate Officers’ remuneration We summarize below the gross remuneration for each Corporate Officer, together with the benefits of all kinds paid by the Company and by the controlled companies for the financial year ended December 31st 2011: SUMMARY OF REMUNERATION, OPTIONS AND SHARES AWARDED TO EACH EXECUTIVE CORPORATE OFFICER (IN €) Mr. Jean-Marie MAGNET Chairman and CEO Remuneration due for the financial year (as itemized in Table 2) Valuation of the options granted during the financial year (as itemized in Table 4) Valuation of the performance shares awarded during the financial year (as itemized in Table 6) TOTAL 2011 397,097 397,097 2010 325,591 325,591 Mr. Philippe MORSILLO Deputy Chief Executive Officer Remuneration due for the financial year (as itemized in Table 2) Valuation of the options granted during the financial year (as itemized in Table 4) Valuation of the performance shares awarded during the financial year (as itemized in Table 6) TOTAL 2011 403,924 403,924 2010 331,064 331,064 28 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=31http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=31Corporate governance Interests and remuneration 2 Amounts paid 152,753 165,494 7,344 325,591 TABLE 2 SUMMARY OF THE REMUNERATION PAID TO EACH EXECUTIVE CORPORATE OFFICER (IN €) Jean-Marie MAGNET Chairman and CEO Base remuneration Variable remuneration (1) Exceptional remuneration Attendance fees Benefits in kind (company car) TOTAL 2011 Amounts payable 152,753 237,000 7,344 397,097 2010 Amounts paid 152,753 248,547 7,344 408,644 Amounts payable 152,753 248,547 7,344 408,644 (1) The variable remuneration was set by the Board of Directors according to qualitative and quantitative criteria based on the Group’s financial results, as well as on external growth transactions, maintained and new referrals, and on the implementation of operational partnerships. The qualitative criteria, and the expected quantitative criteria fulfillment level are not made public due to confidentiality issues. Philippe MORSILLO Deputy Chief Executive Officer Base remuneration Variable remuneration (1) Exceptional remuneration Attendance fees Benefits in kind (company car) TOTAL 2011 Amounts payable 160,000 237,000 6,924 403,924 2010 Amounts paid 160,000 248,547 6,924 415,471 Amounts payable 160,000 248,547 5,570 414,117 Amounts paid 160,000 165,494 5,570 331,064 (1) The variable remuneration was set by the Board of Directors according to qualitative and quantitative criteria based on the Group’s financial results, as well as on external growth transactions, maintained and new referrals, and on the implementation of operational partnerships. The qualitative criteria, and the expected quantitative criteria fulfillment level are not made public due to confidentiality issues. TABLE 3 TABLE SHOWING THE ATTENDANCE FEES AND OTHER REMUNERATION RECEIVED BY NON-EXECUTIVE CORPORATE OFFICERS (IN €) Fabrice DUPONT Company Secretary - Director Base remuneration (in respect of his employment contract) Variable remuneration (in respect of his employment contract) Exceptional remuneration Attendance fees Benefits in kind (company car) TOTAL (1) 2011 Amounts payable 120,000 130,000 5,646 255,646 2010 Amounts paid 120,000 135,000 40,000 5,646 300,646 Amounts payable 120,000 80,000 5,302 205,305 Amounts paid 120,000 100,000 5,302 225,302 (1) Variable compensation for the fiscal year was calculated on the basis of qualitative criteria such as the steering of financial communications and of the integration policy for acquired companies. The difference between the variable compensation payable in 2010 and the variable paid in 2011, as well as the bonus, are justified by a set of qualitative criteria which are not made public for reasons of confidentiality. Attendance fees Corporate Officers Joël MAGNET Sven KADO Martine CHARBONNIER Benoît MÉTAIS TOTAL Amounts paid in 2011 None 32,000 20,000 None 52,000 Amounts paid in 2010 None 16,000 Not applicable Not applicable 16,000 Other than meeting attendance fees, no other compensation was paid to the above mentioned directors. Further information on the allocation of meeting attendance fees is provided in paragraph 2.3. 2011 Registration Document - AUSY 292012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=32http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=322 TABLE 4 TOTAL Corporate governance Interests and remuneration SHARE SUBSCRIPTION OR PURCHASE OPTIONS AWARDED TO EACH EXECUTIVE CORPORATE OFFICER BY THE ISSUER AND ANY OTHER GROUP COMPANY Valuation of the options according to the method Number of selected for the options awarded consolidated financial during the statements financial year Name of the executive Corporate Officer Plan number and date Type of options (purchase or subscription) Exercise Price Exercise period NONE TABLE 5 SHARE SUBSCRIPTION OR PURCHASE OPTIONS EXERCISED DURING THE YEAR BY EACH EXECUTIVE CORPORATE OFFICER Name of the executive Corporate Officer TOTAL Plan number and date Number of options exercised during the year Exercise price NONE TABLE 6 PERFORMANCE SHARES AWARDED TO EACH CORPORATE OFFICER Performance shares approved by the General Meeting of Shareholders Number of and awarded to each Corporate Officer shares awarded by the Issuer and any Group company Plan number during the (list of names) and date financial year TOTAL Valuation of the shares according to the method selected for the consolidated financial statements Purchase date X Vesting date X Performance conditions NONE TABLE 7 Performance shares that have vested for each Corporate Officer TOTAL Plan number and date Number of shares vested during the financial year Purchase conditions NONE TABLE 8 History of subscription option awards Information on subscription or purchase options at December 31st 2011 “2011 OPTIONS” Scheme Meeting date Date of the Board of Directors’ or management Board Meeting, where applicable Total number of shares available for subscription or purchase Number of shares available for subscription or purchase, of which the number available for subscription or purchase by: Corporate Officers Option exercise starting date Expiry date Subscription or purchase price Exercise terms (in cases where the scheme includes multiple tranches) Number of shares subscribed or purchased at March 31st 2012 (most recent date) Total number of canceled or expired share subscription or purchase options Balance of options to subscribe to or purchase shares at year-end None October 20th 2015 October 19th 2019 €19.92 None None None 128,500 June 14th 2011 October 20th 2011 128,500 30 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=33http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=33Corporate governance Interests and remuneration 2 5,524,961 0 794,200 1,163,963 History of equity warrant awards Information on equity warrants at December 31st 2011 (see table footnote for updates) EQUITY WARRANTS (ISIN Code: FR0010505941) General Meeting date June 6th, and August 28th 2007 November 9th 2009 August 28th 2007 Date of the Board of Directors Meeting Total initial number of equity warrants Number of shares available for subscription or purchase, including the number available for subscription or purchase by Corporate Officers Jean-Marie MAGNET Philippe MORSILLO Fabrice DUPONT Public warrant exercise starting date Expiry date Share subscription price Public warrant exercise terms September 10th 2007 October 15th 2012 €18 From September 10th 2007 to October 15th 2012 30,600 None 4,862,734 Number of shares subscribed or purchased at March 31st 2012 Total number of cancelled or expired equity warrants Warrants remaining at December 31st 2011 Current characteristic features of the equity warrants’ are: The General Meeting of Shareholders and the General Meeting of Equity Warrant holders were held on January 10th 2012. They voted to alter the characteristic features of said equity warrants, effective January 12th 2012. Therefore, since January 12th 2012, the characteristic features of the equity warrants are as follows: S S S We would remind you that Board of Directors’ Meeting of August 28th 2007, using the delegation of authority awarded by the Extraordinary General Meeting of August 27th 2007 in its first resolution, decided to issue 2,220,000 independent equity warrants (hereinafter the “Warrants”), 1,000,000 of which were awarded to Philippe MORSILLO, Deputy Chief Executive, on the following basis: S S S extension of the final exercise period date: from October 15th 2012 to October 15th 2015, exercise parity: 28 equity warrants for one ordinary AUSY share (instead of 22 equity warrants for one share), subscription price: €18 (unchanged); the subscription price for each equity warrant was €0.127, the exercise parity was nine equity warrants for one new AUSY share, the exercise price was €16.09. Aside from these initial characteristic features, these equity warrants are listed alongside the public equity warrants and have the same characteristic features as the public 2007 equity warrants, as specified below. In addition, Philippe Morsillo sold 205,800 equity warrants (BSAs) during 2011. Further information relating to share transactions carried out by corporate officers can be found in chapter 2, section 2.2.2. 2011 Registration Document - AUSY 312012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=34http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=342 Meeting date Expiry date Corporate governance Interests and remuneration 2009 BSAAR Award History Information on the BSAARS at December 31st 2011 BSAAR (ISIN Code: FR0010805366) 06/15/2009 09/16/2009 and 09/22/2009 877,480 Date of the Board of Directors’ Meeting Total initial number of warrants Initial number of shares available for subscription or purchase, of which the number available for subscription or purchase by Corporate Officers Jean-Marie MAGNET Philippe MORSILLO Fabrice DUPONT Warrant exercise start date Subscription or purchase price Exercise terms (in cases where the scheme includes multiple tranches) Number of shares subscribed or purchased at March 31st 2012 Total number of canceled or expired BSAARs BSAARs remaining at December 31st 2011 80,000 BSAARs 80,000 BSAARs 80,000 BSAARs 10/20/2011 10/20/2016 €17 From 10/20/2011 to 10/20/2016 595 0 876,956 TABLE 9 BSAARs Total number of BSAARS awarded and/ or shares subscribed or purchased Redeemable share subcriptions and/or purchase granted to the top ten employee beneficiaries who are not Corporate Officers, and BSAARS exercised by the latter BSAAR granted during the financial year by the Issuer and by any company within the BSAAR award scope to the ten employees of the Issuer and of any company within this scope, for whom the number of options granted is the highest. (Overall Information) BSAAR held on the Issuer and the companies mentioned previously, and exercised during the year by the Issuer and these companies’ ten employees, for whom the number of BSAAR thus purchased or subscribed is the highest. (Overall information) Average weighted price * * - - * As a reminder, 117,750 BSAARs were granted in 2009 to the top ten employee BSAAR beneficiaries who are not Corporate Officers out of a total of 15 employees who are not Corporate Officers at a price of €1.25. “2011 OPTIONS” Total number of options awarded and/or shares subscribed or purchased Share subscription or purchase options granted to the ten top employee beneficiaries who are not Corporate Officers, and exercised by the latter Options granted during the financial year by the Issuer and by any company within the option award scope to the ten employees of the Issuer and of any company within this scope, for whom the number of options granted is the highest. (Overall information) Options held on the Issuer and the companies mentioned previously, and exercised during the year by the Issuer and these companies’ ten employees, for whom the number of options thus purchased or subscribed is the highest. (Overall information) Average weighted price 67,000 €19.92 None - 32 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=35http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=35Corporate governance Interests and remuneration 2 No No No TABLE 10 Employment contract Executive Corporate Officers Jean-Marie MAGNET Chairman and CEO Appointment start date: July 2002 Appointment end date: 2016 AGM Philippe MORSILLO Deputy CEO Appointment start date: October 2004 Appointment end date: 2016 AGM Top-up pension scheme Yes No Benefits or payments due or likely to fall due owing to the termination of or Compensation under change to an appointment a no-compete clause Yes No Yes Yes No No No No No No Yes Severance award: we would remind you that Mr. Philippe MORSILLO benefits from a severance award in the event of termination of his appointment as Deputy Chief Executive Officer, as authorized by the Board Meeting of March 28th 2004. The Board Meeting of March 20th 2008 made payment of this award conditional on the fulfillment of performance conditions, in accordance with current regulations. The payment terms for the award were altered, and adapted to the recommendations of the Middlenext Code, the code of reference for the Company, as adopted at the Board Meeting of March 17th 2010. In fact, we would remind you that, in accordance with the Board decision of March 20th 2008, Mr. Philippe MORSILLO may receive a €200,000 severance award under certain conditions in the event that his appointment as Deputy Chief Executive is terminated. At its Meeting of June 17th 2010, the Board of Directors selected the concept of forced termination, which covers both termination and non-renewal of the appointment, in cases where the interested party requests that renewal, while expressly excluding resignation or a change of position within the Group. Moreover, the Board decided that Mr. Philippe MORSILLO will receive a severance award equal to €200,000, subject to the conditions set out below, in the event of the forced termination of his appointment as the Company’s Deputy Chief Executive Officer. It is specified that no payment shall be made if Mr. MORSILLO leaves the Company on his own initiative, or if he changes position within the Group. Payment of this award is subject to the condition that the average current operating income (COI) ratio over the reference period is at least equal to the COI ratio generated in the 2007 financial year. The reference period refers to the financial years from January 1st 2008 onwards, and for which financial statements have been published prior to the termination of the appointment. The annual current operating income is the one featured in the AUSY consolidated financial statements. The COI ratio is equal to the relationship between the AUSY Group’s annual COI and its consolidated revenue. The average is the sum of the COI ratios over the reference period, divided by the number of financial years in question. Fulfillment of the aforementioned performance conditions shall be ascertained by the Board prior to any payment. Apart from the items mentioned above, Corporate Officers do not benefit from of any other share, debt securities, or marketable securities awards granting the holder access to the share capital, or rights to the award of the Company’s or one of its subsidiaries’ debt securities. 2011 Registration Document - AUSY 332012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=36http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=362 HISAM Corporate governance Interests and remuneration 2.2.2. Summary of securities transactions performed by Corporate Officers The table below sets out the securities transactions performed by Directors and other persons during the 2011 financial year in chronological order, pursuant to article L. 621-18-2 of the French Monetary and Financial Code: Corporate Officers’ securities transactions Director or related person Positions held within the Company Company linked to Messrs MAGNET and DUPONT Transaction date 10/14/2011 10/10/2011 06/28/2011 Nature of the transaction Exercise of warrants Purchase Contribution benefit Sale Purchase Contribution benefit Contribution Nature of the financial instrument Unit price Warrants Shares Warrants Warrants Warrants Warrants Warrants 18.00 20.30 0.19 0.19 0.19 0.19 0.19 Number sold 617,386 100,000 69,928 205,800 341,672 205,800 205,800 Sale price €505,136.38 €2,030,000.00 €13,587.00 €39,986.94 €66,386.87 €39,986.94 €39,986.94 Philippe MORSILLO HISAM Deputy CEO Company linked to Messrs MAGNET, MORSILLO and DUPONT Company Secretary Company linked to Messrs MAGNET, MORSILLO and DUPONT Company linked to Messrs MAGNET, MORSILLO and DUPONT Company Secretary 06/15/2011 06/15/2011 05/12/2011 05/12/2011 Fabrice DUPONT HISAM 05/09/2011 05/09/2011 04/01/2011 01/04/2011 03/18/2011 Contribution benefit Contribution Subscription Purchase Sale Shares Shares Shares Shares Pref. subscription rights Pref. subscription rights Pref. subscription rights Pref. subscription rights Shares 21.00 21.00 19.00 21.00 0.01 1,904 1,904 407,680 201,000 1 €39,984.00 €39,984.00 €7,745,920.00 €4,221,000.00 €0.01 Jean-Marie MAGNET Chairman and CEO HISAM Fabrice DUPONT Philippe MORSILLO Deputy CEO 03/18/2011 Sale 0.01 150,000 €1,500.00 Jean-Marie MAGNET Chairman and CEO 03/18/2011 Sale 0.01 1,197,383 €11,973.83 HISAM Company linked to Messrs MAGNET and DUPONT 03/18/2011 Purchase 0.01 1,518,586 €15,185.86 03/01/2011 Purchase 21.00 129,000 €2,709,000.00 34 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=37http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=37Corporate governance Chairman of the Board’s report on corporate governance, internal control procedures and risk management 2 2.3. CHAIRMAN OF THE BOARD’S REPORT ON CORPORATE GOVERNANCE, INTERNAL CONTROL PROCEDURES AND RISK MANAGEMENT For companies whose financial securities are admitted for trading on a regulated market, the law requires the Chairman of the Board of Directors to provide a report, annexed to the Board’s report, on: S S S the Board’s composition and the application of the principle of balanced representation of women and men within; the potential limitations that the Board places on the CEO’s powers; the conditions of preparation and organization of the Board’s work and the internal control and risk management procedures put in place by the Company, with a detailed explanation of these procedures, particularly those relating to the preparation and processing of accounting and financial information for the Company’s financial statements, and if applicable, the consolidated financial statements; the references made to a Corporate Governance Code developed by companies’ representative organizations, notably by specifying the provisions that were waived and the reasons for which they were. This report also presents the principles and rules established by the Board of Directors to set the compensation and benefits in kind granted to Corporate Officers and it must mention the publication in the Management Report of the information concerning the Company’s capital structure and the elements likely to have an impact in the event of a public offering. The present report was submitted to the Board of Directors for approval on March 20th 2012 and passed on to the Statutory Auditors. While preparing this report, the Chairman consulted the Company’s Operational and Support Departments, particularly the Financial Department, the Legal and Tax Department and the Social Affairs Department. S 2.3.1. Corporate Governance THE BOARD OF DIRECTORS Composition of the Board of Directors As of December 31st 2011, the Board of Directors had seven members: S S S S S S S expiring at the end of the 2017 General Meeting that will be called to rule on the 2016 financial statements: S S Ms. Martine CHARBONNIER; Mr. Benoît MÉTAIS. Mr. Jean-Marie MAGNET, Director, Chairman and CEO; Mr. Philippe MORSILLO, Director, Deputy CEO; Mr. Fabrice DUPONT, Director, Group Secretary General; Mr. Joël MAGNET, Director; Mr. Sven KADO, Director; Ms. Martine CHARBONNIER, Director; Mr. Benoît MÉTAIS, Director. In addition, it is reminded that Mr. Jean-Marie MAGNET serves as both Chairman of the Board of Directors and Company CEO. Since October 1st 2004, he has been assisted by Mr. Philippe MORSILLO, who is the AUSY Deputy CEO and steers the Group’s overall commercial policy. Among the Board members, Mr. Sven KADO, appointed as Director at the June 15th 2009 General Meeting, and Ms. Martine CHARBONNIER, appointed as Director at the June 14th 2011 General Meeting, are considered as independent as per the definition set by the Middlenext Code (the Corporate Governance Code to which the Company refers). They are classed as independent due to the lack of a significant financial, contractual or family relationship that may affect the independence of their judgment. At its Meeting of March 16th 2011, the Board of Directors duly noted Mr. Georges PELTE’s resignation from his position as Director. The General Meeting held on June 14th 2011 approved, by majority decision, the appointment of two new Directors, for terms of six years, 2011 Registration Document - AUSY 352012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=38http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=382 S S S S S Corporate governance Chairman of the Board’s report on corporate governance, internal control procedures and risk management Moreover, Ms. Martine CHARBONNIER and Mr. Sven KADO: are not employees or Corporate Officers of AUSY, nor of one of its consolidated companies, and have not held one of these positions over the previous three years; are not significant clients, suppliers or bankers of the Company or its Group, nor does the Company or its Group represent a significant share of their activity; are not major shareholders of the Company; have no close family links with a Corporate Officer or major shareholder; have not been a Company auditor over the previous five years. The attendance rate of 92% for the period was more than satisfactory, with the Directors generally participating in the majority of the Board of Directors’ Meetings. The Works Council members were invited to all Board Meetings and attended regularly. The Statutory Auditors were invited to the Board of Directors Meetings that close the yearly accounts, the half-yearly accounts and the budgeted accounts. Internal rules of the Board of Directors At the March 17th 2010 Board Meeting, the Internal Rules of the Board of Directors were updated to take into account the December 2009 Middlenext Code of Corporate Governance for Midcaps (the code to which the Company refers), instead of the December 2008 AFEP-Medef Code of Corporate Governance for Listed Companies. Furthermore, in order to ensure that such Directors can continue to be classed as independent, the Company has not entered into any commitments with independent Directors. Management of conflicts of interests within the Board of Directors The Internal Rules of the Board of Directors state that: “Directors represent all of the shareholders and must act at all times in the interests of the Company, which correspond to the common interest of the shareholders. In a situation that could lead to, or which could be seen to lead to, a conflict of interest between the interests of the Company and the direct or indirect interests of a Director, or the interests of the shareholder or of a group of shareholders that he/she represents, the Director concerned must: S S S S S Topics debated at Board Meetings and activity assessment At the Board of Directors’ Meetings, the Directors debated important topics relating to the Board’s exclusive purview, notably: S S S S S strategic aims: commercial strategy, Group activity, expansion policy and external growth transactions; organization and communication processes; the Board’s practices; financial statements, budget monitoring, financial transactions; Corporate Officers’ compensation. inform the Board immediately, as indicated below; and consider the consequences in terms of his/her position. Therefore, depending on the circumstances, he/she should: abstain from voting on matters related to the conflict of interest, refrain from attending Meetings of the Board of Directors during the period in which the conflict of interest exists, or resign from his/her position as a Director.” For all these tasks, the Board relies, in particular, on: S S S S S S the Financial Department; the Legal and Tax Department; the Social Affairs Department; Quality Management; COMEX (executive Committee), the Group’s commercial steering Committee; external advisors. Conditions of preparation and organization of the work of the Board of Directors To enable members of the Board of Directors to efficiently prepare for the Meetings, the Chairman communicates all necessary information or documentation in advance. Each time that a member of the Board of Directors requested additional information and documentation, the Chairman passed it on as soon as possible. The Works Council’s delegates receive the same information, and in the same timeframe, as the members of the Board of Directors. Evaluation of the work of the Board of Directors In 2011, a self-assessment questionnaire was given to the members of the B2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=39http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=39Corporate governance Chairman of the Board’s report on corporate governance, internal control procedures and risk management 2 Chairman of the Board of Directors The General Meeting of January 10th 2012 approved an increase in the age limit from 70 to 75 for the Chairman of the Board of Directors and a modification to paragraph 1 of article 20 of the Articles of incorporation, as follows (the rest of the article remains unchanged): “The Board shall elect a Chairman, who must be a natural person, from among its members, for a term that cannot exceed that of his/her term of office as a Director. The Board will determine the Chairman’s compensation. The Board of Directors may end the Chairman’s term of office at any time. The Chairman of the Board must not be over 75 years of age. When the Chairman reaches this age, he/she will be considered to have resigned. (…)” Composition of the audit Committee THE AUDIT COMMITTEE Composition of the audit Committee At its Meeting of March 16th 2011, the Board of Directors unanimously approved the establishment of an audit Committee distinct from the Board of Directors, consisting of three members including two independent Directors with competencies in finance and/or accounting. The competencies of the independent Directors are described in the Registration Document. Mandate Name Sven KADO Fabrice DUPONT Martine CHARBONNIER Age 67 years 45 years 54 years Nationality German French Positions Appointment Re-appointment - Expiring 2015 GM 2014 GM 2017 GM Chairman of the audit Committee Independent member BM 03/23/2011 Member of the audit Committee BM 03/23/2011 Independent member of the audit French Committee BM 06/14/2011 The holding of Meetings of the audit Committee The audit Committee met three times in 2011, i.e. more than the legal minimum: S S Work and topics debated at audit Committee Meetings In accordance with the work assigned to the audit Committee, the members of the Committee review: S S S S two Meetings prior to the closing of the 2010 yearly accounts and 2011 half-yearly accounts; one Meeting on the internal control and risk management procedures. the preparation process for the accounting and financial information for the year; the efficiency of internal control and risk management systems; the conditions under which the Statutory Auditors perform a legal control of the accounts; the Statutory Auditors’ independence. The attendance rate was 100%. The Statutory Auditors were invited to all audit Committee Meetings, which they duly attended. The audit Committee provided a report on its work to the Board of Directors, which acknowledged it. Members of the Committee had sufficient time to examine the financial and accounting documents, and were able to meet with the Financial Management and the Statutory Auditors. On January 7th 2011, the Poupart-Lafarge report relating to the audit Committee was submitted to the Board of Directors(1). Internal rules of the audit Committee At its Meeting of June 14th 2011, the audit Committee adopted its Internal Rules, which are annexed to the Internal Rules of the Board of Directors. (1) AMF has set up a working group on audit Committees, which submitted its report (the “Poupart-Lafarge report”) on July 22nd 2010. The AMF subsequently published, on July 22nd 2010, recommendations aimed at implementing the report’s conclusions and updating the reference frameworks regarding risk management and internal control systems. 2011 Registration Document - AUSY 372012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=40http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=402 Corporate governance Chairman of the Board’s report on corporate governance, internal control procedures and risk management OTHER ASPECTS OF GOVERNANCE Reference Code: Middlenext Code of Corporate Governance for Midcaps At its March 17th 2010 Meeting, the Board of Directors decided to adopt the December 2009 Middlenext Code of Corporate Governance for Midcaps, available on the Middlenext website (www.middlenext. com) and which can be consulted at the Company’s registered office (hereafter “the Reference Code”).The Chairman indicated that the Board of Directors had duly noted the Middlenext Code’s “vigilance points”. Thus, notably concerning the proportion of independent members on the Board, it is specified that Mr. Sven KADO and Ms. Martine CHARBONNIER joined the AUSY Board of Directors as independent Directors in 2009 and 2011 respectively. The Board of Directors currently has seven members, including two independent members. The Company therefore conforms to the Reference Code on this point. Only the Reference Code’s provision relating to the distribution of Directors’ fees was waived, for the following reasons: the eighteenth resolution of the General Meeting of June 14th 2011 set the total amount of Directors’ fees at €60,000. At its June 14th 2011 Meeting, the Board of Directors decided to pay only the independent Directors (according to the independence criteria adopted by the Company), the amount of €4,000 per Board Meeting at which they are present. Thus, only Ms. Martine CHARBONNIER and Mr. Sven KADO receive Directors’ fees as they are independent Directors. transactions listed below are subject to the prior authorization of the Board of Directors or to a decision by its Chairman: S any and all acquisitions of national and/or international entities (companies, goodwill, etc.) for which the total price exceeds €10,000,000; any and all sales of AUSY Group subsidiaries; any and all sales of AUSY Group goodwill or intangible assets. S S Principles and rules for setting the Corporate Officers’ compensation COMPENSATION OF BOARD MEMBERS (DIRECTORS’ FEES) The eighteenth resolution of the General Meeting of June 14th 2011 set the total amount of Directors’ fees at €60,000. In application of this resolution, at its June 14th 2011 Meeting, the Board of Directors decided to pay the independent Directors (according to the independence criteria adopted by the Company), the amount of €4,000 per Board Meeting at which they are present. In 2011, Ms. Martine CHARBONNIER received Directors’ fees of €20,000, while Mr. Sven KADO received €32,000. No other member of the Board of Directors received Directors’ fees in 2011. CORPORATE OFFICERS’ COMPENSATION The Board of Directors sets the Corporate Officers’ compensation policy. This in-depth policy sets the base, variable and exceptional compensation as well as the potential benefits in kind granted by the Company. It sets compensation based not only on the work carried out, the achieved results, the responsibility borne but also on practices observed in similar companies and the compensation of the Company’s other managers. It is specified that base, variable and exceptional compensation is paid only to Executive Corporate Officers. Balanced representation of women and men on the Board of Directors For more information see the Chairman’s report (2.3.1. Table 10). The Board of Directors, acknowledging that it included no women, made a commitment at the beginning of 2011 to reflect on the balanced representation of women and men on its Company’s Board and to proceed within a set timeframe to the appointment of a female Director. Thus, the General Meeting held on June 14th 2011 appointed Ms. Martine CHARBONNIER as a Director for a term of six years expiring at the end of the 2017 General Meeting that will be called to rule on the 2016 financial statements. The Company intends to comply with the applicable legal measures. Setting the base compensation The Board of Directors sets the base compensa2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=41http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=41Corporate governance Chairman of the Board’s report on corporate governance, internal control procedures and risk management 2 Stock options and award of performance shares In 2011, the Company put in place a stock option plan and a performance share plan, but no Corporate Officers benefited from either plan. Shareholder participation in General Meetings The terms of shareholders’ participation in General Meetings are mentioned in article 33 of the Articles of incorporation. Benefits and compensation granted to Corporate Officers for cessation or change of their positions For more information see the Chairman’s report (2.3.1. Table 10). Mr. Philippe MORSILLO will benefit from severance compensation in the event of the termination of his duties as Deputy CEO, as authorized by the Board at its September 28th 2004 Meeting. The March 20th 2008 Board Meeting made this compensation payment subject to compliance with performance conditions in accordance with current regulations. At its Meeting on June 17th 2010, following its discussions and in accordance with the provisions of article L. 225-42-1 of the French Commercial Code, the Board also decided that Mr. Philippe MORSILLO will receive, in the event of his dismissal as the Company’s Deputy CEO, severance compensation of €200,000, subject to the conditions stated below. It is specified that no payment shall be made if Mr. Philippe MORSILLO leaves the Company of his own accord or if he changes duties within the Group. Payment of this compensation is subject to the condition that the average current operating income rate over the reference period be at least equal to the 2007 current operating income rate, being specified that: S S S Elements likely to have an impact in the event of a public offering These elements are detailed in this report in section 6.3.6 of Chapter 6. Code of Conduct on Insider Trading The Company aims to ensure compliance with the laws and regulations on insider trading and with the recommendations issued by the AMF in relation to risk management related to the possession, disclosure or potential use of privileged information. It is in this context that at the January 7th 2011 Board of Directors’ Meeting, the Chairman reminded the Directors, on one hand of their status as insiders due to their Directors’ mandates within the Board of Directors, which gives them access to privileged information, and on the other, of the AMF Recommendations relating to the prevention of insider failings imputable to Corporate Officers of companies listed as of November 3rd 2010. Furthermore, it is reminded that appropriate measures to protect privileged information have been put in place and result notably in: S S S S S the establishment of insider lists; the signature of the insider notice and confidentiality commitments; internal and external insider information; the use of codenames to carry out transactions; the regular communication to insiders of negative windows relating to the publication of financial statements, quarterly information and all other transactions. the reference period relates to the financial years from January 1st 2008, published prior to the mandate’s cessation; the annual current operating income is that mentioned in AUSY’s consolidated financial statements; current operating income rate equals the ratio between the AUSY Group’s annual current operating income and the annual consolidated revenue; the average is the sum of the current operating income rates of the referred years, divided by the number of years. S Compliance with the above-mentioned performance conditions shall be ascertained by the Board prior to any payment. In addition, the Company designate, at the Board Meeting of January 18th 2011, a Head of Compliance and a Deputy Head of Compliance. The Company also established, in January 2012, a Code of Conduct aimed at (i) restating the measures taken to prevent insider failings and the obligations incumbent upon persons, Corporate Officers or not, who may 2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=42http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=422 Corporate governance Chairman of the Board’s report on corporate governance, internal control procedures and risk management 2.3.2. Internal control and risk management procedures AUSY has put in place over a number of years a set of processes, procedures and measures contributing to the management of the risks (operational, financial, legal or other) that may relate to its activity. These processes and procedures are implemented at all its French subsidiaries. For the foreign subsidiaries, the parent company has adapted its internal control and risk management procedures to local constraints, while ensuring that the instructions and guidelines set by the Executive Management comply with the laws and regulations in force. AUSY drew on the reference framework defined by the AMF to draft this chapter in relation to internal control and risk management procedures, presenting (i) the parties involved in the internal control and risk management procedures, and (ii) their implementation. Operational divisions under the executive Committee The members of the executive Committee (COMEX) are the Heads of the Group’s operational divisions, who are in charge of departments or regions, and the Heads of cross-functional Support Departments (e.g. the Head of Strategic Operations). The executive Committee meets once a month, and has a dual objective: a) to analyze the gaps between budgeted and actual figures, and b) to put into perspective the items to be discussed. This Committee then implements the operational strategy decreed by the Group. Support Departments Since February 1st 2011, the Support Departments have been reorganized to assist the Group’s expansion within the framework of the “AVENIR” plan (deadline 2012) and, in particular, the integration of the APTUS group. Thus, a dedicated Social Affairs Department, distinct from the Legal Department and the Financial Department has been set up. FINANCIAL DEPARTMENT THE PARTIES INVOLVED IN THE INTERNAL CONTROL AND RISK MANAGEMENT PROCEDURES The parties involved in the Group’s internal control and risk management procedures are described below. Executive Management The Executive Management: S S S S The Group’s corporate financial activities are centralized within the Financial Department of AUSY both for France and other countries. The Financial Department maintains contact with the operational, administrative and/or financial heads of the international subsidiaries on a daily basis. The Financial Department is responsible for drawing up the financial statements, consolidating the results and managing cash resources, and in particular, managing hedging, interest rate, currency and credit risks. Its remit principally includes: S establishes the Group’s internal control and risk management policies; ensures these policies are applied by working with all the Group’s divisions; ensures that an accounting and financial internal control system is in place and organizes the monitoring of this system; ensures that a system is in place to analyze and manage the main identifiable risks that could have an impact on the preparation of the accounting and financial information published by the Company; ensures that a process is in place to identify, justify and validate changes in accounting principles; ensures that a management system is in place to control the reliability of the accounting and financial information published by the Company; oversees the definition and implementation of processes used to account for major transactions (e.g. business acquisitions or disposals, restructuring, new turnkey contracts) and processes to validate the relevant accounting records. Accounting and statements of account Each statement is settled in collaboration with the Operational Managers and reviewed by the Financial Department. S S S Off-balance sheet commitments Every new contract or new transaction is evaluated and regularly monitored. S S Budgets Revenue, direct costs and commercial structure budgets are produced wi2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=43http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=43Corporate governance Chairman of the Board’s report on corporate governance, internal control procedures and risk management 2 S Cash management Cash management is centralized. A daily reporting is sent to Executive Management and the five-month forecasts are updated monthly. Only the Company Secretary, CFO and Group Treasurer are authorized bank signatories. S the efficiency of all processes: these integrate the recognized norm-model demands (ISO 9001, EN 9100, CMMI) as well as the environmental dimension in which AUSY evolves. S Reporting The Group has implemented internal activity reporting on the pertinent activity indicators and metrics. The periodic reporting, produced with the Syges application, is analyzed by the Financial Department and supplied monthly to the executive Committee and Executive Management to provide a financial overview of how the business is being managed. AUSY’s QSM enables the Group to guarantee the implementation of identical processes at each step of a project managed in multiple regional hubs, by distinct business lines and outside of France. It reflects the partnership strategy sought after by the principals, namely in aeronautics, space and defense, allowing AUSY to consolidate its presence on its clients’ shortlists. Its reach covers not only the geographical zones, but also the activities. Mechanics now has its own Operational Department. With regard to the area certified recently, three new companies have adopted AUSY practices (APTUS, APX and ELAN GmbH). In addition, all certifications expiring in 2011 were renewed in February 2012. As part of the EN 9100 renewal process, and more specifically, the transition to the 2009 version of the standard, AUSY renewed all its certification in the Toulouse, Paris and Hamburg geographical zones for its complex systems integration, onboard software and mechanics activities. Moreover, for the third consecutive year, this certification was carried out without any notification of non-conformity whatsoever. ISO 9001: 2008 was also renewed for the area concerned, including for the Pentalog Technology joint venture. The Project Departments under industrial Operational Management in Paris and the South-West Region (SWR) are certified CMMI-DEV maturity level 3. This model is duplicated both in Nearshore and Offshore. The Group’s international offer packages its processes and quality systems as well as its high performance requirements with firm local steering and inhouse resource development, including on a cross-functional basis. To ensure consistency, an International Department has been set up, which has a dedicated offshore contact for dealings with Group Quality Management. SOCIAL AFFAIRS DEPARTMENT A Social Affairs Department was set up in 2011. It covers the following areas at Group level: S S S S LEGAL AND TAX DEPARTMENT In 2011, the Legal Department expanded its competencies to cover all of the Group’s tax issues. Its role is to provide support for all the transactions made by the Company and its employees. The applicable fields are notably contract law, securities regulation, corporate law, commercial leases, pre-dispute and dispute management, and French and international taxation; it also provides support for Operational Departments on a daily basis. The Department centralizes the legal issues relating to its international activity via a team of international lawyers. It maintains contact with staff at foreign subsidiaries and local advisors. The Legal and Tax Department oversees the legal soundness of specific transactions (Company development of strategy and deployment, external growth, commercial partnerships, internal restructuring, etc.) and provides support for Operating Departments on a daily basis. The Legal and Tax Department puts in place legal processes to manage the legal and tax risks to which the Group may be subject. QUALITY MANAGEMENT The Quality Management Department oversees the application of AUSY’s quality policy, which is set by Executive Man2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=44http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=442 S S Corporate governance Chairman of the Board’s report on corporate governance, internal control procedures and risk management The Purchasing Department has, in addition, implemented many other processes relating to other Support Departments as, for example, the management and monitoring of IT equipment. The computer assets are monitored by the internal Computer Department. Committees AUDIT COMMITTEE See section II – Audit Committee – of Chapter 1 of this report for a presentation of the audit Committee. ADMINISTRATIVE COMMITTEE The administrative Committee (COMIF) comprises the CFO, the Legal and Tax Director, the Social Affairs Director and the Head of Facility Management. The administrative Committee meets on a bi-monthly basis and has two main goals: information flow between discrete Support Departments; reflection on the strategy to be followed to assist the Group’s expansion, implement processes, integrate acquisitions and Support Operational Departments. Other internal control and risk management processes Each Department has put in place a number of tools (processes, training, etc.), for example (not an exhaustive list): S S a reference process and contract management system (the Operational Departments); a contract validation process, contract training for all sales staff and assistants to raise awareness of legal risks, and monitoring of insurance policies in conjunction with brokers (Legal and Tax Department); social processes, social training for all sales staff and assistants to raise awareness of social risks (Social Affairs Department); a purchasing process and a travel process (Facility Management); the implementation of a Quality Management System (QMS), which is reviewed by the Quality Management Department on a regular basis. S S S In addition, the administrative Committee has been internationalized and integrates the international specialists of each Department. Its goal is to assist the Group’s international expansion (through both external and organic growth). The Group’s risk management policy operates as follows: in the event of an alert or if a failing is discovered, corrective measures are put in place to improve and adapt the processes in line with changes within the Group in terms of both staff numbers and business development. INTERNAL CONTROL AND RISK MANAGEMENT PROCEDURES Internal control and risk management procedures relating to the preparation of accounting and financial information AUSY has put in place applicable procedures throughout the Group. These procedures concern information transmission (consolidation documents, revision files, reporting), and some applicable accounting standards. The Group’s procedures are developed by the Group’s Financial Department, in conjunction with each local Accounting Department. As certain clients prefer the Group provide services with committedresults obligation, the method of service providing may be packaged. In that case, prior validation by the Group’s National Projects Department is mandatory, this Department vouching for the estimating and monitoring of this type of services. Steering process Using the SYGES management application, commercial reporting of the main Group indicators is published monthly. It is through these statements that COMEX and the Group’s Executive Management monitor changes in activity, in particular, the gaps between budgeted and actual figures. In addition, the change in accounts receivable is analyzed; however, as most of the Group’s clients are key accounts, the risk of unpaid bills is low, although clients may obtain long payment periods as a result. A certain number of key indicators are also monitored, enabling, for example, the control of structural expenses. An accounts closing process is carried out each quarter, so that a reconciliation can be made between the management accounts and the financial accounts. 42 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=45http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=45Corporate governance Chairman of the Board’s report on corporate governance, internal control procedures and risk management 2 Conclusion of the Chairman's report Internal control concerns everyone, from Management to every Company employee: S the Board of Directors, through its Directors, has complete financial information with all the elements required to steer the Group’s strategy definition and decision-making process; internal control procedures enable the implementation of the Executive Management's instructions which help ensure that financial information is reliable and enhance control of our activity; at the level of each employee, internal control and risk management is carried out through the daily use of the processes and procedures put in place (handbooks, kits, notices, etc.). This is the case for Managers, Operational Managers, Managers of technical support functions and administrative assistants, who all play a crucial role at their respective levels in terms of following procedures, feedback and performance improvement. Nevertheless, as with any control system, an internal control system can only supply reasonable assurance and not an absolute guarantee that these risks have been eliminated, and does not provide certainty that the goals set will be reached, due to the limits inherent in any and all procedures. However, we constantly strive to improve our processes and risk management, through regular upgrades of our internal control procedures. S S Issy-les-Moulineaux March 20th, 2012 Chairman and Chief Executive Officer Jean-Marie MAGNET 2011 Registration Document - AUSY 432012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=46http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=462 Corporate governance Statutory auditor's report of the chairmain of the board 2.4. STATUTORY AUDITOR'S REPORT OF THE CHAIRMAIN OF THE BOARD Statutory Auditors' Report prered pursuant to Article L. 225-235 of the French Commercial Code on the report of the Chairman of the Board of Directors of Ausy SA Headquarters: 88 Bouleverd Galliéni - 92445 Issy-les-Moulineaux Cedex Registered capital: €4,495,007 Year ending December 31 2011 Dear Shareholders, In our capacity as Ausy SA’s Statutory Auditors, and pursuant to the terms of article L. 225-235 of the French Commercial Code, we hereby present you our report on the report prepared by the Chairman of your Company in accordance with the terms of Article L. 225-37 of the French Commercial Code regarding the financial year ended on December 31, 2011. It is the Chairman’s responsibility to prepare and submit to the Board of Directors for approval a report reviewing the internal control and risk management procedures implemented by the Company and providing the other information required by Article L. 225-37 of the French Commercial Code in particular relating to corporate governance. It is our responsibility: S S to report to you our observations stemming from the information contained in the Chairman’s report, concerning the internal control and risk management procedures relating to the preparation and processing of accounting and financial information; and to attest that the report includes the other information required by Article L. 225-37 of the French Commercial Code, it being specified that we are not responsible for assessing the fairness of this other information. We have carried out our tasks in conformity to the professional standards applicable in France. Information concerning the internal control and risk management procedures relating to the preparation and processing of accounting and financial information Professional standards require that we perform procedures to assess the fairness of the information regarding the internal control and risk management procedures relating to the preparation and processing of accounting and financial information set out in the Chairman’s report. These procedures mainly consisted of: S S S obtaining an understanding of the internal control and risk management procedures relating to the preparation and processing of the accounting and financial information on which the information presented in the Chairman’s report is based, and of the existing documentation; familiarizing ourselves with the work that enabled this information to be prepared and with the existing documentation; determining if any material weaknesses in the internal control procedures relating to the preparation and processing of the accounting and financial information that we may have identified in the course of our work are properly described in the Chairman’s report. On the basis of our work, we have no observations to make on the information concerning the Company’s internal control procedures and risk management relating to the preparation and processing of the accounting and financial information set out in the Chairman of the Board of Directors’ report, prepared in accordance with Article L. 225 37 of the French Commercial Code. Other information We attest that the Chairman of the Board of Directors’ report sets out the other information required by Article L. 225-37 of the French Commercial Code. Paris La Défense, April 24 2012 KPMG Audit IS Paris, April 24 2012 Grant Thornton French member of Grant Thornton International Jean-Pierre Valensi Partner Muriel Boissinot-Schneider Partner 44 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=47http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=473 Comments on the 2011 financial year 3.1. ACTIVITY ANALYSIS AND CONSOLIDATED RESULTS 46 46 47 48 3.1.1. Activity 3.1.2. Significant events 3.1.3. Outlook 3.2. AUSY INCOME 3.2.1. 3.2.2. 3.2.3. 3.2.4. 3.2.5. Activity and comments Proposed allocation of income Payment terms Non-deductible amounts Regulated Agreements 49 49 49 50 50 50 3.3. COMMENTS ON SUBSIDIARIES 3.4. INVESTMENTS 3.5. DIVIDENDS 51 53 53 2011 Registration Document - AUSY 452012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=48http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=483 3.1.1. Country France Comments on the 2011 financial year Activity analysis and consolidated results 3.1. ACTIVITY ANALYSIS AND CONSOLIDATED RESULTS Activity Restructuring operations were also carried out on an international basis, with the subsidiary ELAN Spain being merged with APTUS España to form AUSY Servicios de Ingeneria. In Tunisia, the subsidiary APTUS Tunisia changed its name to AUSY Tunisia. Thus, as of the date of this report, the Group to which the activity description refers includes the following companies: Country France Germany PRESENTATION OF THE GROUP In 2011, the AUSY Group comprised the following entities: Entity AUSY Exalen Technologies AUSY DEV AUSY PART APTUS Bordeaux APTUS Orléans APTUS Sophia APTUS FINANCIÈRE APTUS APTNET ELAN AUSY Germany AUSY GmbH ELAN AUSY GmbH ELAN AUSY OHG UK Belgium Luxembourg Spain Romania India Tunisia AUSY UK AUSY Belgium AUSY Luxembourg APTUS España ELAN Spain Pentalog Technology AUSY Technologies India APTUS Tunisia Entity AUSY APTNET AUSY GmbH ELAN AUSY GmbH ELAN AUSY OHG UK Belgium Luxembourg Spain Romania India AUSY UK AUSY Belgium AUSY Luxembourg AUSY Servicios de Ingeneria Pentalog Technology AUSY Technologies India ACCOUNTING CHANGES Consolidated financial statements – Method In accordance with IFRS and, in particular, IAS 19, the Group now recognizes the actuarial gains and losses that impact on its commitments in respect of existing defined benefit plans under “Other comprehensive income items”, instead of on the consolidated income statement. The consolidated financial statements for the previous year have therefore been restated to reflect the change in method, as required by IAS 19. The impact on the 2010 income statement is an additional expense of €84k. The corresponding offsetting entry was an increase of €84k in the item “Changes in valuation of retirement obligations” under “Other comprehensive income items”. The Group implemented certain restructuring operations in 2011. These operations entailed the transfer of all the assets and liabilities of the following companies to AUSY: S S S S S S S S S AUSY DEV; AUSY PART; APTUS Bordeaux; APTUS Orléans; APTUS Sophia; APTUS; FINANCIÈRE APTUS; Exalen Technologies; ELAN AUSY France. Consolidated financial statements – Presentation At the end of 2011, the Group decided to classify the tax on business value-added (CVAE) component of the local business tax (CET), which was introduced in the 2010 Budget Law, as income tax, for the purposes of harmonizing the tax treatment with that of other European countries. 46 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=49http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=49Comments on the 2011 financial year Activity analysis and consolidated results 3 The item “Corporate income tax” on the consolidated income statement includes an expense of €3,030k in respect of this tax, compared with €1,844k in 2010 (restated). Operating income was up 34.7% compared with the previous year, at €21,312k, from €15,819k in 2010. The balance of net financial income and expenses showed expenses of €2,440k, compared with expenses of €1,043k in 2010. In 2011, these expenses included debt financing costs of €1,577k (€857k in 2010) and other financial expenses of €862k (€186k in 2010). The rise in debt financing costs is in line with the increase in activity. Other financial expenses mainly related to the effect of reversing the discounting of deferred payments on acquisitions. After recording income tax, CVAE and the Group’s share of the equityaccounted companies’ net income, the overall net income was up by 60%, at €13,428k versus €8,399k in 2010. Net income, Group share was the same as the net income figure in 2011 (as there were no longer any minority interests at the end of the year); in 2010 it was €7,963k. Net equity, Group share was €71,920k as of December 31st 2011, compared with €36,885k as of December 31st 2010, an increase of 91%. Borrowings and financial liabilities were €44,876k as of December 31st 2011, versus €20,338k as of December 31st 2010. Group cash and cash equivalents totaled €5,081k as of December 31st 2011 versus €14,183k as of December 31st 2010. The Board of March 20th, 2012 closed the consolidated accounts for the year ending December 31st 2011; said accounts showed: S S S SIGNIFICANT FINANCIAL ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS The Group’s consolidated financial statements show: S S S revenue €293,815k up 48.6%; total net income of €13,427,000; there are no minority interests following the purchase by the Group of the 40% stake previously held outside the Group in the french subsidiary Exalen Technologies. By geographical zone, the breakdown is as follows: (in €k) Revenue In% France €232,922k 79% Outside of France €60,891k 21% Net current operating expenses rose to €274,847k, from €181,265k in 2010, a 51.6% rise compared with the previous year. Current operating income increased to €18,968k from €16,395k in 2010, a 15.7% rise compared with the previous year. The balance of other operating income and expenses showed income of €2,343k, compared with expenses of €576k in 2010. This item comprises income from research tax credits, the costs incurred in earning this income, fees related to external growth transactions made during the year and removal costs attributable to changes in premises during the year. revenue of €293,815,253; total net income of €13,427,865; net income, Group share of €13,427,865. 3.1.2. Significant events FEBRUARY 2011: ACQUISITION OF APTUS GROUP On February 9th 2011, the AUSY Group acquired 100% of the equity and voting rights of APTUS group. This transaction added almost 700 employees to the AUSY Group’s headcount, enabling it to achieve critical mass, become a major player on the engineering and technology consulting market and to expand its capacities and offering. It will also enable AUSY to strengthen its presence with key clients, which are constantly looking to prune their provider lists by selecting those with significant capacity in terms of staff, specific technical knowledge and wide geographical presence. In addition, the acquisition gives AUSY strong skills in the high-growth potential energy sector. APTUS group’s energy expertise will benefit AUSY as its numerous references in the sector will represent new growth drivers for the Group. In the AUSY Group’s key sectors (aeronautics and defense, among others), APTUS’ services will complement and expand the Group’s offering. This new, enlarged structure meets principals’ expectations, as well as their goals, which are to prune their provider shortlists, and, as a result, to accentuate technological know-how. L2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=50http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=503 Comments on the 2011 financial year Activity analysis and consolidated results further bank financing. The subscription period ran from March 14th 2011 to March 22nd 2011 (inclusive), and the subscription price was €19 per share (a discount of 16% versus the closing price on February 25th 2010). For the purposes of this transaction, Siparex and Caisse des Dépôts (FCID 2), with the aim of supporting the Group’s growth, entered into a partnership with the Managers through a jointly-owned holding company, HISAM, a simplified limited liability company established in January 2011. Prior to the subscription period, HISAM acquired 129,000 AUSY treasury shares at the price of €21 per share. The stakes taken by these two new partners are a strong sign of confidence in the Group, and will strengthen its control. Although its operations are mainly located in Germany, ELAN has also strengthened AUSY’s Toulouse operations via its subsidiary ELAN France (all of the latter’s assets and liabilities were transferred to AUSY as of December 31st 2011) and contributes to the Group’s international expansion via ELAN Spain (which has been merged with the AUSY subsidiary APTUS España to create AUSY Servicios de Ingeneria). End-2011: Acquisition of Exalen’s 40% stake, followed by a transfer of all its assets and liabilities. At the end of 2011, AUSY acquired the shares owned by Exalen, a minority shareholder. It then transferred all its assets and liabilities at the end of December 2011, and Exalen was merged into AUSY. As of the end of the reporting period, therefore, there are no more noncontrolling interests in the accounts. APRIL 2011: ACQUISITION OF BUSINESS ASSETS FROM APX In the second quarter of 2011, the AUSY Group acquired business assets consisting of approximately 130 experts in the IT services sector from APX. This acquisition has strengthened AUSY’s presence in the Rhone Alps region. RESEARCH TAX CREDITS The Management Report for the previous year stated that at the end of December 2010, the Company had filed a lawsuit seeking to collect €8.6M in research tax credits for 2008 and 2009 due to it in respect of work carried out by its engineers on accredited client programs. The income relating to this claim had not been recognized as the technical documentation relating to the lawsuit was in the process of being drafted. The documentation was finalized during the year, and the tax authority proceeded to the settlement of the amount due. Consequently, the consolidated financial statements for the year include this income under “Other operating income and expenses”. The tax authority carried out an inspection for the 2008 and 2009 financial years, but has yet to announce the outcome. A lawsuit has also been filed to claim research tax credits of around €3.7M for 2010. As the technical documentation is currently being prepared, no income was recognized in the Group’s 2011 financial statements in relation to this lawsuit. APRIL 2011: LINE OF CREDIT OBTAINED On April 7th 2011, the AUSY Group obtained a five-year syndicated line of credit of €32M. JULY 2011: ACQUISITION OF ELAN GMBH On July 18th 2011, AUSY acquired 51% of ELAN GmbH, via its German subsidiary AUSY GmbH. This company, a subsidiary of Germany’s EDAG group, entered into a partnership with AUSY in 2009, through a joint venture set up to provide services to the European aeronautics market. ELAN has almost 200 employees and posted revenue of more than €25M in 2010. 3.1.3. Outlook POST-2011 EVENTS: CHANGE IN FEATURES OF EQUITY WARRANTS (BSAS WITH ISIN CODE FR0010505941) The shareholders’ General Meeting and BSA holders’ General Meeting were held on January 10th 2012. Both Meetings voted to amend the features of the BSAs in question, with effect from January 12th 2012. Thus, from January 12th 2012, the features of the BSAs are as follows: 1. date on which the exercise period ends: October 15th 2015; 2. exchange ratio: 28 BSAs for one ordinary share of AUSY; 3. subscription price: €18. The potent2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=51http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=51Comments on the 2011 financial year AUSY Income 3 3.2. AUSY INCOME 3.2.1. Activity and comments AUSY reported revenue of €199,500k in 2011, versus €157,652k the previous year, an increase of 26.55%, and net income of €18,484k, up from €6,854k in 2010. The growth in revenue was partly due to the change in the scope of consolidation owing to the merger into the Company of the subsidiary AUSY DEV (following the transfer of all its assets and liabilities on May 31st 2011), which previously recognized the activities acquired from the APX group, and until June 30th 2011, of the companies in the APTUS group. The merger into the Company of its subsidiaries Exalen Technologies and ELAN France did not have any impact on activity, as these transactions were carried out at the end of the year. Operating expenses (net of other operating income) rose to €191,137k from €145,694k in 2010. These expenses mainly consist of payroll costs (€135,580k) and purchasing and external expenses (€49,304k). Operating income totaled €8,364k in 2011, compared with €11,958k in 2010. Net financial income was €5,888k in 2011, versus €495k in 2010. It includes, inter alia, a reversal of impairment on shares in subsidiaries of €4,329k. The balance of extraordinary income and expenses showed expenses of €350k in 2011, compared with income of €23k in 2010. Income tax for the period was €1,465k. The 2011 results show net income of €18,484k, up from €6,854k in 2010. Non-current equity interests in subsidiaries are recorded as non-current financial assets for a gross value of €24,181k, and no impairment was recorded in respect of this item as of December 31st 2011. Impairment provisions of €4,329k recorded as of December 31st 2010 in respect of the shares of subsidiaries in Belgium and Luxembourg were reversed in full during the year. The net value of the related goodwill is €36,559k. These two items represent most of the €68,569k figure for non-current assets. Total current assets are valued at €133,335k, including accounts receivable of €72,500k and cash and cash equivalents of €35,573k, of which €32,521k relates to factoring. As of December 31st 2011, equity stood at €71,438k. The total amount of provisions and liabilities was €133,030k, of which €58,109k relates to tax and social security liabilities, €20,929k to bonds issued and €23,704k to bank borrowings. The Board closed the accounts of AUSY for the year ending December 31st 2011; said accounts showed: S S revenue of €199,500,419.65; total net income of €18,483,700.89. 3.2.2. Proposed allocation of income The allocation of our Company’s income that we propose is in accordance with the law and our Articles of incorporation. Having noted that in the Company’s financial statements, the statutory reserve, at €366,761.30, no longer corresponds to a tenth of the Company’s share capital, owing to the various capital increases carried out in 2011 following the exercise of BSAs and BSAARs, we propose to allocate the net income for the year of €18,483,700.89 as follows: S stood at €366,761.30, would reach €449,500.70, equivalent to a tenth of the share capital. S Balance brought forward: €18,400,961.49 Statutory reserve: €82,739.40 The balance remaining after the allocation to the statutory reserve, i.e. €18,400,961.49, is allocated in full to “Balance brought forward”. Thus, taking into account the previous balance brought forward, of €15,901,553.59, after this allocation of €18,400,961.49, the “Balance brought forward” would increase to €34,302,515.08. In accordance with the terms of article 243 bis of the French General Tax Code, we remind you that no dividend was paid out over the last three years. In accordance with article L. 232-10 of the French Commercial Code, it is mandatory to allocate 5% of net income to the statutory reserve, until this reserve reaches a tenth of the share capital. After this allocation of €82,739.40, the statutory reserve, which previously 2011 Registration Document - AUSY 492012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=52http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=523 S S Comments on the 2011 financial year AUSY Income 3.2.3. Payment terms As of December 31st 2011, the balance of AUSY’s debts to suppliers breaks down by due date as follows: due date within 45 days: 92.6%; due date post 45 days: 7.4%. As of December 31st 2010, the remainder of AUSY’s debts to suppliers broke down by due date as follows: S S due date within 45 days: 89.6% due date post 45 days: 10.4% 3.2.4. Non-deductible amounts We request that you approve the total amount of expenses and charges mentioned in articles 39-4 of the French General Tax Code for an amount of €191k and corresponding tax of €64k at December 31st 2011. 3.2.5. Regulated Agreements The General Meeting of June 14th 2011 approved the following agreements: S an agreement relating to the termination benefits of the Deputy CEO authorized by the Board of Directors on June 17th 2010; We remind you that this agreement had been authorized at the Board of Directors’ meeting of March 20th 2008 and approved by the General Meeting of June 15th 2008. The terms of this agreement were modified in accordance with the Middlenext Code, the code adopted by the Company at the Board meeting of March 17th 2010; In addition, the following agreements shall be submitted for approval at the next General Meeting held to rule on the financial statements for 2011: S sale of a maximum of 330,000 AUSY treasury shares in favor of HISAM SAS (authorized by the Board of Directors on January 7th 2011); an agreement to transfer receivables between the companies AUSY, AUSY Belgium and Eurofactor to Eurofactor (authorized by the Board of Directors on March 16th 2011); an agreement for a current account advance of €18,500,000 from AUSY to AUSY PART (authorized by the Board of Directors on March 16th 2011); a joint guarantee granted to AUSY GmbH (authorized by the Board of Directors on June 14th 2011). S S a centralized cash management agreement between AUSY and its subsidiaries Exalen Technologies, AUSY Belgium, AUSY Luxembourg PSF SA and AUSY GmbH, authorized by the Board of Directors on August 25th 2010. S S 50 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=53http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=53Comments on the 2011 financial year Comments on subsidiaries 3 3.3. COMMENTS ON SUBSIDIARIES France EXALEN TECHNOLOGIES At the end of 2011, AUSY held 100% of its subsidiary Exalen Technologies, having acquired the 40% it did not already own. All of the assets and liabilities of this subsidiary were transferred to AUSY as of December 31st 2011. This french subsidiary of AUSY achieved revenue of €8,915k in 2011, compared with €7,949k in 2010. Its net income was €1,313k, compared with €983k in 2010. APTUS SOPHIA This french subsidiary of AUSY, which became part of the Group in 2011 following the acquisition by AUSY of the APTUS group, achieved revenue of €201k in 2011, compared with €513k in 2010. It recorded a net loss of -€10k in 2011, compared with a net loss of -€96k in 2010. All of the assets and liabilities of this subsidiary were transferred to AUSY as of June 30th 2011. AUSY DEV This french subsidiary of AUSY, which was established in 2011, achieved revenue of €1,765k for the year and recorded a net loss of -€260k. All of the assets and liabilities of this subsidiary were transferred to AUSY as of June 1st 2011. APTUS This french subsidiary of AUSY, which became part of the Group in 2011 following the acquisition by AUSY of the APTUS group, achieved revenue of €32,318k in 2011, compared with €62,489k in 2010. It recorded a net loss of -€415k in 2011, compared with a net loss of -€1,181k in 2010. All of the assets and liabilities of this subsidiary were transferred to AUSY as of June 30th 2011. AUSY PART This french subsidiary of AUSY did not record any revenue in 2011 or 2010. It recorded a net loss of -€228k in 2011, compared with a net loss of -€1k in 2010. All of the assets and liabilities of this subsidiary were transferred to AUSY as of June 1st 2011. FINANCIÈRE APTUS This french subsidiary of AUSY, which became part of the Group in 2011 following the acquisition by AUSY of the APTUS group, achieved revenue of €150k in 2011, compared with €300k in 2010. It recorded a net loss of -€4k in 2011, compared with a net loss of -€62k in 2010. All of the assets and liabilities of this subsidiary were transferred to AUSY as of June 30th 2011. APTUS BORDEAUX This french subsidiary of AUSY, which became part of the Group in 2011 following the acquisition by AUSY of the APTUS group, achieved revenue of €54k in 2011, compared with €112k in 2010. It recorded net income of €4k in 2011, compared with a net loss of -€23k in 2010. All of the assets and liabilities of this subsidiary were transferred to AUSY as of June 30th 2011. APTNET This french subsidiary of AUSY, which became part of the Group in 2011 following the acquisition by AUSY of the APTUS group, did not record any revenue in 2011 or 2010. It recorded a net loss of -€2k in 2011, compared with a net loss of -€3k in 2010. APTUS ORLÉANS This french subsidiary of AUSY, which became part of the Group in 2011 following the acquisition by AUSY of the APTUS group, achieved revenue of €989k in 2011, compared with €1,610k in 2010. It recorded net income of €44k in 2011, compared with net income of €152k in 2010. All of the assets and liabilities of this subsidiary were transferred to AUSY as of June 30th 2011. ELAN AUSY FRANCE This french subsidiary of AUSY, which became part of the Group in 2011 following the acquisition by AUSY of ELAN GmbH, achieved revenue of €1,993k in 2011, compared with €2,220k in 2010. It recorded net income of €148k in 2011, compared with a net loss of -€373k in 2010. All of the assets and liabilities of this subsidiary, which AUSY acquired from its subsidiary AUSY GmbH in November 2011, were transferred to AUSY as of December 31st 2011. 2011 Registration Document - AUSY 512012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=54http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=543 Comments on the 2011 financial year Comments on subsidiaries Germany The accounting information provided below for the German subsidiaries complies with IFRS, and takes into account any divergence between the HGB and french standards. ELAN AUSY GMBH This company (previously called ELAN GmbH) incorporated under German law, in which AUSY acquired control in 2011 with a 51% stake, achieved revenue of €24,788k for the year. It recorded a net loss of -€2,201k in 2011. This loss includes the -€1,673 loss recorded on the sale of its stakes in ELAN Spain and ELAN France to AUSY. AUSY GMBH This company, wholly-owned by AUSY and incorporated under German law, did not record any revenue in 2011 as in 2010. It recorded a net loss of -€287k in 2011, compared with a net loss of -€103k in 2010. ELAN – AUSY OHG This joint venture incorporated under German law, which is 50%-owned by AUSY, was created in 2009 for the purpose of pooling resources, mainly in the aeronautics sector. It did not record any revenue in 2011, and posted a net loss of -€0.4k. UK AUSY UK This wholly-owned company incorporated under UK law achieved revenue of €271k in 2011. It recorded a net loss of -€182k in 2011. Belgium AUSY BELGIUM This wholly-owned company incorporated under Belgian law achieved revenue of €40,623k in 2011, compared with €33,977k in 2010. It recorded net income of €491k in 2011, versus €641k in 2010. Luxembourg AUSY LUXEMBOURG This wholly-owned company incorporated under Luxembourg law achieved revenue of €5,201k in 2011, compared with €4,562k in 2010. It recorded net income of €232k in 2011, versus €497k in 2010. Spain APTUS ESPAÑA This Spanish subsidiary, which became part of the Group in 2011 following the acquisition by AUSY of the APTUS group, achieved revenue of €666k in 2011, compared with €1,152k in 2010. It recorded a net loss of -€118k in 2011, compared with a net loss of -€102k in 2010. The subsidiary ELAN Spain was merged into APTUS España at the end of the year to form AUSY Servicios de Ingeneria. ELAN SPAIN This Spanish subsidiary, which became part of the Group in 2011 following the acquisition by AUSY of ELAN GmbH, achieved revenue of €1,847k in 2011. It recorded a net loss of -€24k in 2011. This company did not carry out any activity in 2010. ELAN Spain was merged into APTUS España at the end of the year to form AUSY Servicios de Ingeneria. 52 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=55http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=55Comments on the 2011 financial year Dividends 3 Romania PENTALOG TECHNOLOGY This company, incorporated under Romanian law and 50%-owned by AUSY, achieved revenue of €6,514k in 2011, compared with €5,468k in 2010. It recorded net income of €362k in 2011 versus €602k in 2010. India AUSY TECHNOLOGIES INDIA This company was established at the end of 2011 and therefore did not report any results for the year. Tunisia AUSY TUNISIA This company (previously called APTUS Tunisia) incorporated under Tunisian law, which became part of the Group in 2011 following the acquisition by AUSY of the APTUS group, achieved revenue of €99k in 2011. It reported a net loss of -€16k in 2011. The company’s activity was put on hold temporarily at the end of the year. 3.4. INVESTMENTS The investments of the AUSY Group in the year ended December 31st 2011 totaled €1,810k. The Group made no significant investments in 2011, and the investments carried out during the year related to the ordinary conduct of business. 3.5. DIVIDENDS No dividends have been paid out over the last five years. 2011 Registration Document - AUSY 532012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=56http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=563 Comments on the 2011 financial year 54 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=57http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=574 Consolidated financial statements 4.1. CONSOLIDATED BALANCE SHEET 56 4.2. CONSOLIDATED INCOME STATEMENT 57 4.3. OTHER COMPREHENSIVE INCOME ITEMS 4.4. CONSOLIDATED CASH FLOW STATEMENT 4.5. CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 4.6. NOTES TO THE FINANCIAL STATEMENTS 4.7. INFORMATION ON THE PRO FORMA STATEMENTS 4.8. STATUTORY AUDITOR'S REPORT 4.8.1. Statutory Auditor's report on the consolidated financial statements 4.8.2. Pro forma information report 58 59 60 61 83 89 89 90 2011 Registration Document - AUSY 552012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=58http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=584 (in €k) Goodwill Consolidated financial statements Consolidated balance sheet 4.1. CONSOLIDATED BALANCE SHEET Note 7 8 9 10 11 12 14 15 16 17 18 18 12/31/2011 79,369 664 3,447 624 1,251 2,299 87,653 5 128,970 3,675 10,156 5,081 147,887 235,540 12/31/2010 42,382 421 2,142 536 786 1,158 47,425 165 66,709 4,626 2,566 11,617 85,683 133,107 3,668 16,707 -6,092 -25 1,627 20,999 36,885 763 763 37,648 20,151 315 12,313 32,779 187 2,057 8,915 2,764 48,758 62,681 95,460 133,107 Non-current intangible assets Property, plant and equipment Investments in associates Other non-current financial assets Deferred taxes NON-CURRENT ASSETS Inventory and work-in-progress Accounts receivable Tax receivables Other current assets Marketable securities and other investments Cash and cash equivalents CURRENT ASSETS TOTAL ASSETS Share capital Other paid-in capital Treasury shares Other reserves Convertible financial instruments Balance brought forward TOTAL SHAREHOLDER EQUITY, GROUP SHARE Non-controlling interests TOTAL NON-CONTROLLING INTERESTS TOTAL SHAREHOLDER EQUITY Borrowings and financial liabilities Commitments to personnel Other non-current liabilities TOTAL NON-CURRENT LIABILITIES Bank borrowings and facilities (current portion) Provisions Accounts payable Tax liabilities Other current liabilities TOTAL CURRENT LIABILITIES TOTAL LIABILITIES TOTAL SHAREHOLDER'S EQUITY AND LIABILITIES 19 4,495 30,932 -83 -37 20 19 1,618 34,995 71,920 0 0 71,920 21 22 23 21 22 24 25 26 32,656 915 26,235 59,806 12,220 2,658 16,005 262 72,668 103,814 163,620 235,540 56 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=59http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=59Consolidated financial statements Consolidated income statement 4 197,660 -54,610 -122,676* -3,894* -792 1,179 165 -637 16,395 -576 15,819 -857 -857 -186 14,776 -6,677* 8,099 301 8,400 7,963 436 2.40 1.90 4.2. CONSOLIDATED INCOME STATEMENT FY 12/31/2010 Restated (in €k) Turnover External expenses Payroll and benefits expenses Taxes other than income tax Increase in/Write-back of amortization Increase in/Write-back of depreciations and provisions Changes in work-in-progress and finished products inventories Other operating income and expenses Current operating income Other operating income and expenses OPERATING INCOME Gross financing costs Net financing costs Other financial income and expenses INCOME ON ORDINARY ACTIVITIES BEFORE INCOME TAXES Income taxes INCOME ON ORDINARY ACTIVITIES AFTER INCOME TAXES Share of investments in associates’ net income TOTAL NET INCOME Group share Non-controlling interests share Earnings per Share (in €) Diluted Earnings per Share (in €) * Note FY 12/31/2011 293,815 -82,724 27 28 28 14 -186,672 -5,911 -1,264 2,042 -160 -158 18,968 29 30 30 31 10 2,343 21,312 -1,577 -1,577 -862 18,872 -5,554 13,318 109 13,428 13,428 - 32 32 3.19 3.01 The 2010 Consolidated Cash Flow Statement was restated in order to take into account changes in the method explained in detail in Note 3 and concerning: • the variation of commitments subsequent to its use; • the Posting of the Tax on Value Added by French Companies (CVAE) with respect to taxes on profits. 2011 Registration Document - AUSY 572012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=60http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=604 (in €k) Consolidated financial statements Other comprehensive income items 4.3. OTHER COMPREHENSIVE INCOME ITEMS FY 2010 Restated 8,400 -20 84 -216 44 -109 8,291 7,855 436 FY 2011 13,428 -13 -402 -527 287 -655 12,773 12,773 - Total net income Other comprehensive income items Change in translation adjustments Valuation of pension commitments Swap valuation Tax savings on other comprehensive income items TOTAL OTHER COMPREHENSIVE INCOME ITEMS TOTAL COMPREHENSIVE INCOME Group share Non-controlling interests share 58 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=61http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=61Consolidated financial statements Consolidated cash flow statement 4 FY N-1 12/31/2010 Restated 8,400* -301 -83 28 8,045 6,677* 1,111 15,832 -2,185 -3,160* 10,487 -1,638 -10 -166 48 44 -1,840 -3,561 4 -5,998 -652 -559 -7,204 -279 14,449 14,170 14,183 -13 4.4. CONSOLIDATED CASH FLOW STATEMENT (in €k) Total net consolidated income Adjustments Elimination of Investments in affiliates income Elimination of amortizations, depreciations and provisions Expenses and income related to share-based payment Elimination of sales income and dilution gains and losses Operating cash flow after net financing costs and income taxes Elimination of income tax receivables/liabilities Elimination of net financing costs Operating cash flow before net financing costs and income taxes Effect of change in working capital requirements Income taxes paid CASH FLOWS FROM OPERATING ACTIVITIES Effect of changes in scope of consolidation Acquisition of Property, plant and equipment and non-current intangible assets Financial assets acquisition Change in loans and advances granted Sale of property, plant and equipment and non-current intangible assets Financial assets sale Other cash flows from investing activities CASH FLOWS FROM INVESTING ACTIVITIES Capital Increase Net Sale/Buyback of treasury shares New loans Reimbursed loans Net financial interest paid Other cash flows from financing operations CASH FLOWS FROM FINANCING OPERATIONS Effect of variations in foreign exchange rates CHANGES IN CASH AND CASH EQUIVALENTS Cash and cash equivalents at start of the year Cash and cash equivalents at end of the year Cash and cash equivalents - Assets Cash and cash equivalents - Liabilities * FY N 12/31/2011 13,428 -109 1,106 29 195 14,649 5,569 1,577 21,795 -23,658 -11,004 -12,867 -29,606 -4,186 -3 1,645 7 0 -32,143 14,680 6,966 23,414 -8,891 -276 9 35,902 0 -9,108 14,170 5,062 5,081 -20 The 2010 Consolidated Cash Flow Statement was restated in order to take into account changes in the method explained in detail in Note 3 and concerning: • the variation of commitments subsequent to its use; • the Posting of the Tax on Value Added by French Companies (CVAE) with respect to taxes on profits. 2011 Registration Document - AUSY 592012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=62http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=624 (in €k) Consolidated financial statements Consolidated statement of changes in equity 4.5. CONSOLIDATED STATEMENT OF CHANGES IN EQUITY Total shareholder capital Income for - Group the Period share 4,607 4,607 -56 0 8,019 -4,607 7,963 7,963 7,963 13,428 -7,963 13,428 33,851 33,851 -144 -20 8,019 1,176 -5,998 36,885 36,885 36,885 -352 -291 -13 13,428 -668 638 562 15,683 6,009 39 71,920 Share Capital 3,562 3,562 105 3,668 3,668 0 3,668 827 4,495 Other paid-in Capital 15,636 15,636 1,071 16,707 16,707 0 16,707 -668 14,855 38 30,932 Treasury Shares -94 -94 -5,998 -6,092 -6,092 0 -6,092 6,009 -83 Other Group reserves Total 10,140 10,140 -144 56 -20 4,607 14,639 14,639 14,639 -352 -291 -13 0 638 562 0 7,963 1 23,148 NonTotal Controlling shareholder Interests equity 326 326 436 763 763 763 -763 34,178 34,178 -144 -20 8,456 1,176 -5,998 37,648 37,648 37,648 -352 -291 -13 13,428 -668 638 -200 15,683 6,009 39 71,920 Balance at start of 2010 Effect of changes in accounting policies: Restated balance at start of 2010 Swaps valuation Provisions for retirement benefits Translation adjustments 2009 Income Increase of capital 2008 Income Treasury share trading BALANCE AT END OF 2010 Balance at start of 2011 Effect of changes in accounting policies: Restated balance at start of 2011 Swaps valuation Provisions for retirement benefits Translation adjustments Income for the period Elimination of cost of capital increases (net of income tax) Elimination of gains on treasury shares (net of income tax) Buyback of minority holdings Capital increase 2008 income Treasury share trading Miscellaneous BALANCE AT END OF 2011 60 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=63http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=63Consolidated financial statements Notes to the financial statements 4 76 77 77 78 79 79 79 79 80 80 4.6. NOTES TO THE FINANCIAL STATEMENTS APPENDIX NOTE 1 NOTE 2 NOTE 3 General information about the Company Accounting policies and methods Unusual items, changes to estimates, changes in accounting policies, significant events during the period and events after the reporting period Business combinations and scope of consolidation Operating sectors Financial risk factors Goodwill Non-current intangible assets Property, plant and equipment Investments in associates Non-current financial assets Deferred taxes Categories of financial instruments Inventory and work-in-progress Clients Tax receivables Other current assets Marketable Securities and Cash and cash equivalents NOTE 19 Reserves and Income 62 62 NOTE 20 Convertible financial instruments giving access to equity NOTE 21 NOTE 22 Financial liabilities Provisions Non-current liabilities 66 68 69 70 71 72 73 73 73 74 75 75 75 76 76 76 NOTE 23 NOTE 4 NOTE 5 NOTE 6 NOTE 7 NOTE 8 NOTE 9 NOTE 10 NOTE 11 NOTE 12 NOTE 13 NOTE 14 NOTE 15 NOTE 16 NOTE 17 NOTE 18 NOTE 24 Trade NOTE 25 Tax liabilities NOTE 26 Other current liabilities NOTE 27 NOTE 28 NOTE 29 Employee payroll and benefits expenses Provisions and allocations relating to depreciation and amortization Other operating income and expenses 80 81 81 82 82 82 83 83 NOTE 30 Financial Result NOTE 31 NOTE 32 NOTE 33 Income tax Earnings per share Statement of cash flows explained NOTE 34 Off-balance sheet commitments NOTE 35 Information on related parties NOTE 36 Employees 2011 Registration Document - AUSY 612012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=64http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=644 NOTE 1 2.1. Consolidated financial statements Notes to the financial statements General information about the Company This Company is the AUSY Group’s parent company, specializing in IT services. AUSY SA manages the Group’s equity investments. It provides Advanced Technology Consulting. The consolidated financial statements represent AUSY SA and its subsidiaries for the year ended on December 31st 2011. AUSY is a public limited company registered in France, whose registered office is at 88 boulevard Gallieni, 92130 Issy-les-Moulineaux. NOTE 2 Accounting policies and methods Assets intended for sale or consumed during the Group’s normal operating cycle, assets intended for sale within 12 months following the closing date, as well as cash and cash equivalents are considered current assets. All other assets are non-current. The liabilities falling due during the Group’s normal operating cycle or within 12 months following the closing of the accounts are considered current liabilities. All other liabilities are non-current. ACCOUNTING FRAMEWORK The 2011 Consolidated Financial Statements have been established in accordance with the IFRS (International Financial Reporting Standards), as adopted by the European Union as at December 31st 2011. The following new standards, amendments and interpretations, mandatory for the financial year commencing on January 1st 2011, had no impact on the Group’s financial statements: S S S S S Amendment to IAS 32 – Classification of rights issues; Amendment to revised IAS 24 – Related party disclosures; 2010 Annual Improvements to IFRS (May 2010); Amendment to IFRIC 14 – Prepaid contributions in the context of minimum funding requirements; IFRIC 19 – Extinguishing financial liabilities with equity instruments. 2.3. ACCOUNTING ESTIMATES The following published new standards, amendments and interpretations, whose application was not yet mandatory for the financial year commencing on January 1st 2011 and which have not been adopted by the European Union, have not been applied in advance: S S S S S S S S S S S The Group’s financial statements are established in accordance with IFRS, which require management to produce estimates and assumptions likely to have an impact on the amounts posted to assets and liabilities, and to disclose information on the potential end-of-year amounts as well as on the income and Expenses amounts recorded over the year. Actual income may differ from these estimates. They mainly concern impairment tests on assets and provisions; the valuation methods and assumptions retained when identifying non-current intangible assets during business combinations; the determination of the useful life of non-current intangible assets; the estimated provisions for contingencies and expenses, including in particular litigation-related expenses; the assumptions retained for the recognition of deferred taxes and, for recognition of revenue, the status of work-in-progress. Amendment to IAS 1 – Presentation of financial statements; IAS 12 – Deferred taxes: Recovery of underlying assets; Amendment to IAS 19 – Post-employment benefits; Amendment to IAS 27 – Separate financial statements; IAS 28 revised – Investments in associates and joint ventures; IFRS 7 – Disclosures related to transfers of financial assets; IFRS 9 – Financial instruments; IFRS 10 – Consolidated financial statements; IFRS 11 – Joint arrangements; IFRS 12 – Disclosure of interest in other entities; IFRS 13 – Fair value measurement. 2.4. SCOPE OF CONSOLIDATION The consolidated financial statements include all the subsidiaries under AUSY SA’s control. Control exists when the Group has the power to steer the Company so as to obtain benefits from its activities, or is presumed to exist if the AUSY Group holds over half of the controlled company’s voting rights. The full list of subsidiaries controlled and integrated within the scope of consolidation, as well as the consolidation methods applied to them is provided in Note 4. 2.2. PRESENTATION OF TH2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=65http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=65Consolidated financial statements Notes to the financial statements 4 All balance sheet lines in foreign currencies are translated into euro at the rate on the closing date, with the exception of the net position which is kept at its historical value. Income statement lines in foreign currencies are translated into euro at the year’s average exchange rate, unless in the case of significant fluctuations over the year. method. There are no non-current intangible assets with an indefinite period of use. For internally generated non-current intangible assets, the Group incurs no expenses related to research activities to gain new scientific and technical knowledge. However, should that be the case, these would be recorded as expenses when incurred. Expenses related to development activities for the improvement of products and new processes are posted as balance sheet assets if the product or the process is ruled both technically and commercially viable and the Group intends to complete its development. 2.6. BUSINESS COMBINATIONS From January 1st 2010, the Group has applied revised IFRS 3 - Business combinations. For acquisitions carried out since January 1st 2010, the Group has introduced modifications to the acquisition method as set by the revised IFRS 3 standard: S 2.9. PROPERTY, PLANT AND EQUIPMENT goodwill is measured as the fair value of the transferred counterpart (including the fair value of all prior equity investments held in the acquired company) increased by the amount recorded for all noncontrolling equity investments, less the amount recorded (generally the fair value) for the identifiable acquired assets and taken-over liabilities, all these elements being valued on the acquisition date. When the difference is negative, the resulting acquisition gain is immediately recorded as income; the Group has the option of measuring any and all non-controlling equity investments held in the acquired company either for the share of the identifiable net assets of the acquired company, or at fair value. This option is available individually for each acquisition; any and all acquisition price adjustment is recorded at fair value on the acquisition date and later changes are recorded under “other operating income and expenses”; acquisition costs other than those related to a bond or share issue, which the Group would incur due to a business combination, are recorded under “other operating expenses” when they are incurred. S Property, plant and equipment is measured at the cost of acquisition less the accrued depreciation and impairment. Depreciations are mainly calculated according to the straight-line method. The following economic life periods are used: layout and installations over eight years; transport equipment over three to five years; office equipment over five years; computer equipment over three to five years; and furniture over eight years. Economic life periods and depreciation methods applied to property, plant and equipment are periodically reviewed and, if they significantly change, the depreciations for the current and future periods are adjusted accordingly. If the book value of an asset exceeds its economic value, an impairment loss is immediately recorded in income. On each closing date, an evaluation is performed to identify potential impairment of property, plant and equipment. S 2.10. ASSET IMPAIRMENT Goodwill and non-depreciable assets are impairment tested at least once a year. The period between impairment tests may be shorter if events or circumstances indicate that it may not be possible to recover the book value. Such events or circumstances include but are not limited to: S S S S S In the case of a business combination achieved in stages, prior equity investment held in the acquired company is re-evaluated at fair value on the acquisition date and the potential resulting gain or loss is recorded under “other operating income” or “other operating expenses”. The Group records the impacts resulting from the application 2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=66http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=664 2.11. Consolidated financial statements Notes to the financial statements Value losses recorded for goodwill are never written-back. For other assets, an impairment booked during previous financial years may be written-back as income to return the asset to its economic value. The CGUs used for impairment testing are not larger than the operating sectors determined according to IFRS 8 – Operating sectors. 2.15. SHAREHOLDERS’ EQUITY In the case of buybacks of treasury shares, and regardless of the reasons, the shares thus acquired are deducted from the total shareholder equity and recorded under “treasury shares” until their later cancellation or sale. The amount paid, the directly related transaction costs and the impacts of potential sales are recorded as “Changes in share equity”. When free shares are issued, the Group determines if the issue is a compensation for services rendered by employees or management. The compensation is then recorded as payroll expenses for the duration of the vesting period. RENTAL AGREEMENTS The Group evaluates its rental agreements and defines them either as operating leases, or as finance leases. In the case of operating leases, lease payments are recorded as soon as they become payable. In the case of finance leases, the assets held are recorded under property, plant and equipment at their acquisition value less any accrued depreciation, and the liability related to finance leases is included in financial liabilities. 2.16. PROVISIONS Provisions are recognized for present obligations (legal or implicit) arising from past events that will probably give rise to a future outflow of resources to extinguish the obligation, provided that a reliable estimate can be made of the amount of the obligations. Provisions for losses at completion are booked when it becomes probable that the overall estimated costs for a contract shall exceed the overall probable proceeds concerning the same contract. These provisions are booked by reducing the Receivables for the part of the work already accomplished, and as Provisions for the part of the work still in progress. Provisions are discounted when the impact of the time value is significant. The impact of the discount at each closing date is recognized under financial expenses. 2.12. ACCOUNTS RECEIVABLE Accounts receivable are the receivables stemming from recognized revenue not yet settled by the debtor, as well as the receivables stemming from recognized revenue according to work-in-progress. If it is likely the Group will not be able to collect all amounts due in accordance with the initial terms of the receivables, an impairment is booked. AUSY signed a factoring agreement in 2003 with Eurofactor, subsequently modified by several amendments. As per this agreement, part of the accounts receivable has been sold. These sales are deemed non-deconsolidating and are restated in the consolidated financial statements. 2.17. BORROWINGS BEARING INTEREST 2.13. FINANCIAL ASSETS The Group’s equity interests in subsidiaries are recorded in accordance with revised IFRS 3. Other equity interests, which the Group intends to and can hold to maturity, are recorded under “Other non-current financial assets”. At each closing date, the Group assesses whether there is objective proof that a financial asset or a group of financial assets is likely to be impaired. Applicable booked impairments are never written-back. Financial assets are classified as marketable securities and recorded at their fair value. Borrowings bearing interest are recorded at their initial face value, less the related transaction costs. For subsequent measurement, these borrowings remain recorded at cost depreciated by their effective interest rate over the period of the borrowings. Bond with redeemable equity warrant (OBSAAR): On October 20th 2009, the Group issued a bond (OBSAAR) granting the bearer a set number of share subscription rights. The debt component of the financial instrument is initially recorded at the same fa2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=67http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=67Consolidated financial statements Notes to the financial statements 4 Interest related to financial liabilities is posted to the income statement. 2.20. INCOME TAXES Income tax expenses (or income tax receivables) are the total taxes payable and deferred taxes posted to the income statement. 2.18. PERSONNEL BENEFITS a) Pension commitments Taxes payable Taxes payable are (i) the estimated amount of taxes due on a year’s taxable income, determined by using the rate already adopted or for all intents and purposes adopted at the closing date, (ii) any and all adjustments of the amount of taxes due for previous years, and (iii) any other tax calculated on the net income and expenses. Commitments to defined-benefits plans relate to retirement compensation in France and to pension commitments in Germany. A provision is accordingly recognized in the balance sheet, calculated according to the projected unit credit method. The provision thus calculated is actualized to present value. Actuarial gains and losses are posted under “other comprehensive income items”. Deferred taxes Deferred tax assets and liabilities mirror the decreases or increases of future taxes due, arising for some assets and liabilities from the temporary valuation differences between their book values and their taxable bases, as well as the tax losses and credits to be carried forward. Deferred tax assets and liabilities are valued according to the income tax rates set by the applicable Budget Bills for the years in which these temporary differences are likely to be reversed or balanced. b) Share-based payments Share options representing equity settled, share-based payments are granted to Corporate Officers and some employees on a regular basis. These transactions are measured at fair value on the date of allocation using the Black & Scholes valuation model. Variations in the fair value of options after the allocation date have no impact on their initial valuation. Fair value is recognized according to the linear method under “Employee payroll and benefit expenses” during the vesting period, offset by the corresponding adjustment to shareholder equity. The Group also has a bonus share plan for its Corporate Officers and some of its employees. The fair value of these plans is equal to the value of the free shares on the date of allocation, taking into account the personnel turnover rate during the vesting period and the valuation of the lock-up period restriction, where applicable. These bonus share plans result in the recognition of a payroll charge spread over the vesting period. CVAE (Company value-added contribution) On the 2011 closing date, the Group decided to qualify the French Company Value-Added Contribution (Cotisation sur la Valeur Ajoutée des Entreprises – CVAE) of the Local Economic Contribution (Contribution Économique et Territoriale – CET), a tax introduced by the 2010 Budget Bill, as a tax on income to ensure consistency with the accounting standards for similar taxes in other countries. This item is detailed in part 3 of these notes. 2.21. INCOME FROM ORDINARY ACTIVITIES Proceeds of sales are recorded when the risks and benefits are transferred to the acquirer and when their amount may reliably be measured. 2.19. DERIVATIVE FINANCIAL INSTRUMENTS The Group uses derivative financial instruments to hedge its exposure to interest rate risk stemming from its investment activities. Derivative financial instruments are valued at fair value. The fair value of interest rate swaps is the estimated amount that the Group would receive or pay to cancel the swap on the closing date, taking into account the current interest rate level and the credit risk of the swap counterparties. Fair value is set by the banks at each closing. The gain or loss resulting from fair value revaluation is immediately recorded as income, except when a derivative financial instrument is designated as a hedging instrument for changes in cash flow of a highly likely planned transaction. The effect2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=68http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=684 Consolidated financial statements Notes to the financial statements The potential losses on contracts are analyzed at each closing date and provisions for losses at completion are booked if and when identified. 2.23. OTHER OPERATING INCOME AND EXPENSES Other operating income and expenses arise from transactions that, due to their nature, their amount or their infrequency, may not be considered as part of the Group’s activities and income from ordinary activities and are likely to impact comparability of the current operating income from year to year. 2.22. EARNINGS PER SHARE Earnings per share prior to dilution are calculated by dividing net income (Group share) by the average weighted number of outstanding shares over the year, with the exception of the average number of bought-back common shares held as treasury shares. Diluted earnings per share are calculated using all the instruments that offer deferred rights in the consolidating company’s share capital, whether the shares are issued by the consolidating company or by one of its subsidiaries. Dilution is determined instrument by instrument, with consideration given to the conditions existing at the time the accounts are closed. Furthermore, net income is adjusted to eliminate the financial effects net of tax of the dilutive instruments. The funds are taken into account pro rata for the year of issue of the dilutive instruments and as of the first day of the financial year for the following years. 2.24. RELATED PARTY TRANSACTIONS Related party transactions include, in particular, transactions with: S members of the Group’s key management, defined as the persons in charge of planning, management and control of the Group’s activities, including the members of the Board of Directors, as well as close members of their families; entities controlled by the Group; entities over which the Group has control or joint control; entities controlled or held jointly by one of the Group’s Directors or Corporate Officers. S S S NOTE 3 Unusual items, changes to estimates, changes in accounting policies, significant events during the period and events after the reporting period Before January 1st 2011, these actuarial gains and losses were recognized as income. In accordance with IAS 8 – Accounting Policies, Changes in Accounting Estimates and Errors, this accounting policy change was applied retroactively to all periods presented, as though this method had always been applied. 3.1. CHANGE TO ACCOUNTING POLICIES Provision for retirement compensation The Group opted to recognize actuarial gains and losses under other comprehensive income items, as proposed by 93 A-D of IAS 19. The table below summarizes the impact of this change on the Group’s financial statements at December 31st 2010: Income statement (in €k) Payroll and benefit expenses Current operating income Income tax TOTAL NET INCOME Net income – Group share Net income – Non-controlling interests share Year 2010 -84 -84 28 -56 -57 1 3.2. CHANGE IN PRESENTATION METHOD French Company Value-Added Contribution (CVAE) As indicated above in the section on accounting policies and methods, on the 2011 closing date, the Group decided to qualify the French Company Value-Added Contribution (Cotisation sur la Valeur Ajoutée des Entreprises – CVAE) component of the Local Economic Contribution Economic Contribution (Contribution Economique et Territoriale – CET), a tax introduced by the 2010 Budget Bill, as a tax on income to ensure consistency with the accounting standards for similar taxes in other countries. Prior to January 1st 2011, this tax was recognized under “Taxes other than income tax” in current operating income. 66 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=69http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=69Consolidated financial statements Notes to the financial statements 4 12/31/2010 1,844 1,844 -1,844 - The table below summarizes the impact of this change in presentation method on the Group’s financial statements at December 31st 2010: Income statement (in €k) Taxes other than income tax Current operating income Income taxes TOTAL NET INCOME Net income – Group share Net income – Non-controlling interests share 3.3. SIGNIFICANT EVENTS February 2011: APTUS group acquisition AUSY acquired all of the capital and voting rights in the APTUS group on February 9, 2011. As a result of the transaction, AUSY has increased its headcount by almost 700 people, giving it critical mass in the Engineering and Technology Consulting market and augmenting its capacity and offering. This acquisition enables AUSY to strengthen its presence with key clients, the latter continuously pruning their providers’ short-list by selecting those which have large capacities in terms of staff, specific technical knowledge and wide geographical presence. It enables AUSY to acquire major skills in the high-growth potential energy sector. AUSY now benefits from APTUS’s energy expertise: its many references in this sector act as new growth drivers for the Group. In its key sectors (Aeronautics and Defense amongst others), AUSY will also be in a position to leverage the additional services provided by APTUS. This new enlarged structure meets the expectations of prime producers, who aim to reduce their provider shortlists and, as a result, to accentuate their technological know-how. In addition, this acquisition opens up new markets for the Group, particularly in Spain. and enhances access to further bank financing. The subscription period extended from March 14th to March 22nd 2011 (inclusive) at a price of €19 per share (a discount of 16% relative to the share closing price on February 25th 2010). Siparex and the Caisse des Dépôts (FCID 2) expressed their interest in supporting the Group’s growth during this issue and teamed up with Managers in a joint holding, HISAM, a simplified joint stock company created in January 2011. Prior to the start of the subscription period, HISAM acquired 129,000 AUSY treasury shares at €21 per share. The stakes taken by these two new partners are a strong sign of confidence in the Group, and will strengthen its control. April 2011: Goodwill acquisition of APX Q2 2011 saw the AUSY Group finalize the goodwill acquisition of APX, a company with some 130 employees operating in the IS sector. The acquisition reinforces AUSY’s presence in the Rhône Alpes region of France. April 2011: Line of credit obtained On April 7th 2011, the AUSY Group concluded a deal for a five-year syndicated line of credit totaling €32M. March 2011: €15M minimum capital increase, with pre-emption rights; Siparex and CDC Entreprises take stakes in the Group As part of its expansion plans, the AUSY Group announced the launch of a €15M rights issue on March 1st 2011. The issue is detailed in the prospectus filed with the AMF on February 28th 2011 under no. 110056. The rights issue was completed with pre-emption rights to enable the Group’s shareholders to participate in the offering. The proceeds provide AUSY with additional resources, strengthens its equity base July 2011: Acquisition of ELAN GmbH On July 18th 2011, AUSY completed the acquisition of a 51% stake in ELAN GmbH, through its German subsidiary, the remaining 49% will be purchased before December 31st 2013. A subsidiary of the German group EDAG, the company was linked to AUSY since 2009 through a joint venture formed for the purposes of the European aeronautics market. ELAN has a headcount of 200 and posted revenue in excess of €25M in 2010. 2011 Registration Document - AUSY 672012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=70http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=704 Consolidated financial statements Notes to the financial statements Although its main location is in Germany, ELAN will also enhance AUSY’s Toulouse operations through its ELAN France subsidiary (whose assets and liabilities were transferred in full to AUSY on December 31st 2011) and contribute to the Group’s international growth with a presence in Spain through ELAN Spain (merged with AUSY’s Spanish subsidiary, APTUS España, to create AUSY Servicios de Ingeneria). Moreover, a similar application was submitted for 2010 for a Research Tax Credit of €3,731k. As the technical documents are currently being prepared, no income has been recognized in the Group’s accounts at December 31st 2011. Tax audit The tax authorities conducted an audit of the accounts for financial years 2008 and 2009. To date, the Company has been notified of an additional tax assessment totaling €74,000 for VAT concerning scrappage. This amount was posted to the accounts on December 31st 2011. With respect to the Research Tax Credit, examination of the application by the authorities is still in process. End-2011: Acquisition of 40% of the shares in Exalen followed by the full transfer of all its assets and liabilities AUSY purchased the stake of Exalen’s minority shareholder at the end of 2011. Following the share acquisition, all of Exalen’s assets and liabilities were transferred at end-December 2011 and the company was merged with AUSY. Accordingly, there are no non-controlling interests in the accounts on the closing date. 3.4. EVENTS AFTER THE REPORTING PERIOD Crédit Impôt Recherche (Research Tax Credit – CIR) At the end of December 2010, AUSY filed a lawsuit seeking to collect the Research Tax Credit amounts due to it for its engineers’ work on client-accredited programs with respect to 2008 and 2009 for an amount totaling €8.6M. The income to which this application refers had not been recognized, as the technical documents for the procedure were still being prepared. The documents were finalized during the financial year and the tax authorities settled the amounts. As a result, the consolidated income for the period recognizes this amount under other operating income and expenses. On January 10th 2012, the Extraordinary General Meeting of AUSY SA’s shareholders voted to extend the exercise period of the stock warrants issued by the Board of Directors’ Meeting of August 28th 2007, thus extending the final exercise date from October 15th 2012 to October 15th 2015. The shareholders also voted to amend the parity for the exercise of these stock warrants, increasing the number of warrants for one AUSY common share from 22 to 28. The price remained unchanged at €18. This new potential dilution now stands at 173,692 shares compared with 224,157 shares before. The equity warrant holders approved these changes during the General Meeting held on January 10th 2012. NOTE 4 4.1. S S Business combinations and scope of consolidation Accordingly, the difference between the acquisition price and the net assets acquired was allocated in full to goodwill. The goodwill recognized as a result of these acquisitions amounts to: S S BUSINESS COMBINATIONS The following business combinations were completed by AUSY in 2011: acquisition of 100% of the APTUS group on February 9th 2011; acquisition of 51% of the ELAN group on July 18th 2011. The remaining 49% stake will be acquired before December 31st 2013. €22.7m regarding the APTUS group; €12.1m regarding the ELAN group (for the entire group). The details of these acquisitions and their objectives are set out in section 3.3 “Significant events”. The cash acquired from these acquisitions amounts to: S S The period of allocation of goodwill for APTUS closed on February 9th 2012. No events occurred after closing to overturn the analysis presented above. In accordance with IFRS 3-R, the period of allocation of the acquisition price for the ELAN group ends on July 18th 2012. The allocation of goodwill to the half-yearly accounts may there2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=71http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=71Consolidated financial statements Notes to the financial statements 4 4.2. SCOPE OF CONSOLIDATION As of December 31st 2010, the scope of consolidation was as follows: Legal entity name AUSY SA AUSY Belgium AUSY Luxembourg AUSY GmbH ELAN AUSY GmbH ELAN AUSY OHG AUSY Servicios de Ingeniera SL AUSY UK Private Ltd AUSY Tunisia APTNET SARL Pentalog Technology Registered office Issy-les-Moulineaux (France) Brussels (Belgium) Leudelange (Luxembourg) Hamburg (Germany) Hamburg (Germany) Hamburg (Germany) Getafe (Spain) London (UK) Tunis (Tunisia) Versailles (France) Brasov (Romania) % control 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 50% % interest 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 50% Consolidation method Full consolidation Full consolidation Full consolidation Full consolidation Full consolidation Full consolidation Full consolidation Full consolidation Full consolidation Full consolidation Equity accounted AUSY SA acquired APTUS in February 2011. This Group comprised the following companies: APTUS SA, FINANCIÈRE APTUS, APTUS Bordeaux, APTUS Orléans, APTUS Sophia, APTNET, APTUS España and APTUS Tunisia. At the end of June, APTUS SA, FINANCIÈRE APTUS, APTUS Bordeaux, APTUS Orléans and APTUS Sophia were absorbed by AUSY through the transfer of all assets and liabilities. AUSY SA acquired ELAN in July 2011. 51% was acquired immediately and the remaining 49% will be acquired before December 31st 2013. The Group is formed by ELAN GmbH in Germany, ELAN Spain and ELAN France. ELAN Spain was merged with the AUSY subsidiary, APTUS España, at the year end to create AUSY Servicios de Ingeniera SL. ELAN France was absorbed by AUSY. AUSY purchased the stake of Exalen’s minority shareholder at the end of 2011. Following the share acquisition, all of Exalen’s assets and liabilities were transferred at end-December 2011 and the company was merged with AUSY. These restructuring operations had no impact on the consolidated financial statements. NOTE 5 Operating sectors S Pursuant to IFRS 8 – Operating sectors, sector information is presented on the basis of the internal management data used by the Executive Management, who are the main operating decision-makers. There are four operating sector: S others, including: S S S S Spain (AUSY Servicios de Ingeniera SL, formed by the merger of APTUS España with ELAN Spain), the United Kingdom (AUSY UK Private Ltd), Tunisia (AUSY Tunisia), Romania, with the Pentalog Technology joint venture (equity method). France, with the AUSY SA entities, APTNET, and the companies absorbed during the year by AUSY Exalen Technology, ELAN France, APTUS SA, FINANCIÈRE APTUS, APTUS Bordeaux, APTUS Orléans and APTUS Sophia; Belgium and Luxembourg, with the AUSY Belgium and AUSY Luxembourg entities; Germany, with AUSY GmbH, ELAN AUSY GmbH and ELAN AUSY OHG; S S Transfers and transactions between segments are conducted under the normal commercial conditions applicable to unrelated third parties. 2011 Registration Document - AUSY 692012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=72http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=724 2011 Revenue Net income Employees Consolidated financial statements Notes to the financial statements Operating segment information is as follows (in €k): France 232,922 12,496 168,895 2,381 -966 1,656 2,980 Belgium and Luxembourg 45,208 1,204 37,878 -95 75 360 Germany 13,770 -164 23,162 46 -184 70 253 Other 1,913 -108 3,306 105 -21 9 37 Total 293,813 13,428 233,241 2,532 -1,265 1,810 3,630 Segment assets Deferred tax assets Segment asset depreciation Non-current asset acquisitions 2010 Revenue Net income* Segment assets Deferred tax assets Segment asset depreciation Non-current asset acquisitions Employees * 2010 net income was restated for retirement commitments. France 160,067 7,286 94,911 1,107 -327 1,498 1,980 Belgium and Luxembourg 37,594 813 36,475 32 -150 149 320 Germany 36 20 - Other 301 527 - Total 197,660 8,400 131,949 1,158 -477 1,648 2,300 N.B.: no customer represents more than 10% of Group revenue. NOTE 6 Financial risk factors assessment will be revised in 2012, given AUSY’s expansion outside the euro zone (UK and India). There have been no further exchange rate risks since December 31st 2011. EXCHANGE RATE RISK Transactions by AUSY are essentially limited to Europe and are invoiced in euro. Foreign exchange risk is considered insignificant. This No sensitivity analysis was carried out since the amounts in question are very low. INTEREST RATE RISK This risk relates in the main to the issue of the bond with redeemable equity warrant (OBSAAR) in October 2009. The risk has been hedged to 2013; hedge described in paragraph 21. Financial liabilities The Group uses the following financing: Type (in €k) (1) Syndicated loan Miscellaneous borrowings (2) OBSAAR Fixed or Floating Rate Floating Floating Floating Face Value 23,395 205 19,743 Balance as of 12/31/2011 23,395 147 19,743 Under one year 3,960 88 6,581 Over one year 19,435 59 13,162 Hedge Yes No Yes (1) Syndicated loan The Company arranged a floating-rate syndicated credit line in April 2011. It drew down several tranches for a total of €23,395k. As these are floating rates, swaps were arranged at each drawdown to hedge the rates at fixed rates of: • 4.54% for €8,000k; • 4.55% for €8,000k; • 3.60% for €5,395k; (2) Bond with redeemable equity warrant (OBSAAR): In October 2009, the Company issued bonds with redeemable equity warrant (OBSAARs) with October 2012, October 2013 and October 2014 maturity dates, by thirds. As these are floating-rate notes, an interest rate swap was arranged to hedge the rate at 2.312%. 70 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=73http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=73Consolidated financial statements Notes to the financial statements 4 In light of the above, the Company is not exposed to interest rate risk. LIQUIDITY AND COUNTERPARTY RISK Liquidity risk is the risk that the Group cannot meet its financial obligations. The Group’s approach to managing this risk is to permanently ensure that it has sufficient funds to meet its liabilities when they mature. The Group’s client base is mainly composed of key accounts as of December 31st 2011, with the top ten clients accounting for 44% of revenue. Almost all accounts receivable are sold to the factor, which reflects the good quality of the client base. Since December 31st 2011, there have been no additional credit and/ or counterparty risks. NOTE 7 Goodwill Goodwill, recognized as changes and according to geographical sector, is as follows: (in €k) France Belgium and Luxembourg Germany Spain TOTAL NET VALUE 42,382 Opening position 12/31/2010 15,681 26,701 First-time consolidation 25,846 9,983 1,546 37,375 Other changes in scope -388 -388 Closing position 12/31/2011 41,139 26,701 9,983 1,546 79,369 The change in net value of goodwill in 2011 is related mainly to the firsttime consolidation of APTUS and ELAN into the AUSY Group. Other 2011 changes in the net value of goodwill stem from the final payment of an earn-out in France. The Group conducts goodwill impairment tests at the level of the cash flow-generating units each year, using cash flow projections. Established over a five-year period, existing operating forecasts are based on past experience and market outlook. The results of the valuation of goodwill according to the discounted cash flows method (DCF) indicate no impairments to be booked. A perpetuity growth rate of 1.8% is the working assumption (1.8% in 2010). The discount rate is the average weighted cost of Group financing which comes out at 9.82% (vs. 9.47% in 2010). The table below indicates the discount and perpetuity growth rate levels below which an impairment of the assets of the Cash Flow generating units would have been required: Value for which break-even is reached: Cash Flow generating unit France Belgium and Luxembourg Germany Spain Discount rate 20.94% 15.15% 10.65% 11.00% Perpetuity growth rate N/A (negative) N/A (negative) N/A (negative) N/A (negative) An analysis of the calculation sensitivities for the various key parameters used (Return on Capital, discount and Perpetuity Growth rate levels) according to reasonably possible hypotheses, did not create any scenario in which the recoverable value of the Cash Flow Generating Unit would be less than its book value. 2011 Registration Document - AUSY 712012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=74http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=744 (in €k) Consolidated financial statements Notes to the financial statements NOTE 8 Non-current intangible assets Changes in non-current intangible assets (gross value, depreciations and net value) are the following, presented in €k: Opening position 12/31/2010 Acquisitions 25 1,197 17 1,239 -25 -776 0 -17 -818 421 -2 1 247 246 -2 1 247 - Depreciation Sales expenses -75 -75 74 -0 74 -2 -31 -309 -0 -340 -31 -309 - Closing Changes in Reclassifications position scope and scrapping 12/31/2011 364 63 865 134 1,425 -364 -52 -538 -134 -1,087 11 327 -64 64 2 83 -85 2 19 -21 361 25 2,298 134 17 2,835 -361 -25 -1,634 -134 -17 -2,171 664 - R&D Expenses Concessions, patents and similar rights Purchased software, internal use Non-current intangible assets in progress Other non-current intangible assets TOTAL NON-CURRENT INTANGIBLE ASSETS Amortization/Depreciation research and development expenses Amortization/Depreciation concessions, patents and similar rights Amortization/Depreciation software purchased Amortization/Depreciation of goodwill Amortization/Depreciation non-current intangible assets in progress Amortization/Depreciation other non-current intangible assets TOTAL AMORTIZATION/PROVISIONS NON-CURRENT INTANGIBLE ASSETS R&D expenses Concessions, patents and similar rights Purchased software, internal use Non-current intangible assets in progress Other non-current intangible assets TOTAL NET VALUE OF NON-CURRENT INTANGIBLE ASSETS 421 246 -2 -340 338 0 664 72 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=75http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=75Consolidated financial statements Notes to the financial statements 4 Closing position 12/31/2011 3,330 206 4,086 1,684 24 9,330 -1,447 -187 -3,203 -1,041 -4 -5,884 1,883 19 883 642 20 NOTE 9 Property, plant and equipment Changes in property, plant and equipment (gross value, depreciations and net value) are the following, presented in €k: Opening position 12/31/2010 Depreciation Expenses Changes in scope (in €k) Building improvements, miscellaneous improvements Transport equipment Office and IT equipment Furniture Other property, plant and equipment TOTAL PROPERTY, PLANT AND EQUIPMENT Amortization building improvements, miscellaneous improvements Amortization transport equipment Amortization office and IT equipment Amortization furniture Amortization/Depreciation other property, plant and equipment TOTAL AMORTIZATION/DEPRECIATION OF PROPERTY, PLANT AND EQUIPMENT Building improvements, miscellaneous improvements Transport equipment Office and IT equipment Furniture Other property, plant and equipment TOTAL NET VALUE OF PROPERTY, PLANT AND EQUIPMENT Acquisitions Sales 1,820 138 2,665 609 5,233 -427 -98 -2,096 -470 -3,091 1,393 40 569 140 - 778 482 302 1,562 778 482 302 - -332 -1 -333 145 1 147 -187 - -732 -29 -434 -173 -3 -1,370 -732 -29 -434 -173 -3 1,063 68 941 772 24 2,868 -434 -60 -675 -399 -2 -1,569 630 7 266 374 22 2,142 1,562 -187 -1,370 1,299 3,447 NOTE 10 Investments in associates These are interests in the Pentalog Technology joint venture, which posted revenue of €6,514k (€5,468k in 2010) for a net income of €362k (€602k in 2010). Following the acquisition of the ELAN Group in 2011, ELAN AUSY, which in 2010 was an AUSY and ELAN joint venture, became a wholly-owned subsidiary and is therefore fully consolidated. NOTE 11 Line breakdown: Non-current financial assets Opening position 12/31/2010 12 787 -13 786 (in €k) Non-consolidated equity investments Loans, guarantees and other receivables Depreciation loans, guarantees and other receivables TOTAL NON-CURRENT FINANCIAL ASSETS First-time consolidation 29 226 254 Increases 3 286 289 Decreases -14 -64 -78 Closing position 12/31/2011 29 1,235 -13 1,251 2011 Registration Document - AUSY 732012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=76http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=764 (in €k) ASSETS LIABILITIES Provisions Consolidated financial statements Notes to the financial statements NOTE 12 Deferred taxes The effective tax rates are 33.33% for France, 31.13% for Germany, 20% for the United Kingdom, 30% for Spain, 33.99% for Belgium, 28.80% for Luxembourg, 16% for Romania and 30% for Tunisia. The breakdown of deferred taxes is as follows: 12/31/2010 Opening position Net Income impact Goodwill Income impact Deferred Taxes Assets Income impact Deferred Taxes Liabilities Reserves impact 12/31/2011 Closing position Net Non-current assets Tax loss carry-forwards Other accounts receivable 51 666 -298 -13 -270 -13 419 -270 111 176 676 463 906 118 105 197 716 88 1,158 479 1 93 1,239 -20 90 188 -63 -102 -283 -283 283 - Financial liabilities Employee profit-sharing Other payables TOTAL Compensation NET TOTAL 287 2,299 1,158 -1,239 -385 287 2,299 The breakdown of deferred tax assets on tax loss carry forwards: 2011 Deferred Tax Assets on tax law carry forwards: Benelux Deferred Tax Assets on tax law carry forwards: France Deferred Tax Assets on tax law carry forwards: Germany Deferred Tax Assets on tax law carry forwards: Spain Deferred Tax Assets on tax law carry forwards: United Kingdom Deferred Tax Assets on tax law carry forwards giving rise to activation of Deferred Taxes 223 92 69 36 419 51 19 2010 32 The Group preserves its deferred taxes because the forecasts established for each entity demonstrate that future profits will be greater than profits generated by the reversal of temporary existing taxable differences (probable imputation from now until the next three years). 74 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=77http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=77Consolidated financial statements Notes to the financial statements 4 1,251 128,970 3,675 10,156 5,081 NOTE 13 Categories of financial instruments The table below shows the book value of the categories of financial instruments as of December 31 2011: Financial assets at fair value by income Loans and Receivables at amortized cost (in €k) Non-Current Assets Other non-current financial assets Current Assets Accounts receivable Tax receivables Other current assets Cash and cash equivalents 12/31/2011 closing 1,251 128,970 3,675 10,156 5,081 (in €k) Non-current liabilities Borrowings and financial liabilities Other non-current liabilities Current liabilities Bank borrowings and facilities (current portion) Accounts payable Other current liabilities Financial liabilities at fair value Financial liabilities 12/31/2011 closing by income at depreciated cost 32,656 26,235 12,220 16,005 72,668 909 31,747 26,235 12,220 16,005 72,668 NOTE 14 Inventory and work-in-progress (in €k) Merchandise inventory Depreciation of merchandise inventory TOTAL INVENTORY AND WORK-IN-PROGRESS Closing position 12/31/2011 5 5 Opening position 12/31/2010 165 165 NOTE 15 Clients (in €k) Accounts receivable - Trade Accounts receivable - Trade, invoices to be issued Accounts receivable - Trade sold to Factor TOTAL ACCOUNTS RECEIVABLE - TRADE Closing position 12/31/2011 54,948 35,600 38,422 128,970 Opening position 12/31/2010 30,318 12,940 23,451 66,709 2011 Registration Document - AUSY 752012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=78http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=784 (in €k) (in €k) Consolidated financial statements Notes to the financial statements NOTE 16 Tax receivables Closing position 12/31/2011 3,675 3,675 Opening position 12/31/2010 - State income tax TOTAL TAX RECEIVABLES NOTE 17 Other current assets Closing position 12/31/2011 4,197 320 836 2,271 2,532 10,156 Opening position 12/31/2010 2,115 57 287 1,345 822 4,626 Other receivables Advances and payments on account - Trade Receivables - Personnel and social organizations State debit balance (excluding income tax) Equalization account TOTAL OTHER CURRENT ASSETS NOTE 18 Marketable Securities and Cash and cash equivalents 12/31/2011 Marketable securities - Cash equivalents Sub-total: Marketable securities and other investments Sub-total: Cash and cash equivalents TOTAL TOTAL MARKETABLE SECURITIES AND CASH AND CASH EQUIVALENTS 5,081 5,081 12/31/2010 2,566 2,566 11,617 14,183 NOTE 19 Reserves and Income The Company’s Share Capital, constituted of 4,495,007 shares of €1 par value, has only one category of shares: common shares. The Reserves and Income line breaks down as follows: (in €k) Statutory reserve Group consolidation reserves Income for the period Closing position 12/31/2011 367 21,200 13,428 34,995 Opening position 12/31/2010 356 12,624 8,019 20,999 76 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=79http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=79Consolidated financial statements Notes to the financial statements 4 NOTE 20 Convertible financial instruments giving access to equity The August 27th 2007 General Meeting authorized the issue of 2,200,000 equity warrants reserved for certain Group Managers. The exercise of these equity warrants would create 244,444 new AUSY shares (nine equity warrants for one share). The subscription price for the warrants was set at €0.127. The November 9, 2009 General Meeting modified the characteristics of these equity warrants. The exercise parity is thus 22 equity warrants for one share. As detailed in paragraph 3.4, “Events after the reporting period”, on January 10th 2012, the Extraordinary General Meeting of AUSY’s shareholders voted to extend the exercise period of the equity warrants issued by the Board of Directors’ Meeting of August 28th 2007, extending the final exercise date from October 15th 2012 to October 15th 2015. The shareholders also voted to amend the parity for the exercise of these stock warrants, increasing the number of warrants for one AUSY common share from 22 to 28. The price remained unchanged at €18. This new potential dilution now stands at 173,692 shares compared with 224,157 shares before. On October 20th 2009, AUSY issued 219,370 bonds with redeemable equity warrants (OBSAARs) for €20,840k. The note component was recorded under long-term financial debts (see paragraph 21 below, “Financial liabilities”) for €19,743k. The redeemable equity warrant (BSAAR) component was posted, after deduction of costs, in shareholder equity for €672k. During the previous financial years, AUSY issued free shares in the amount of €476k. In 2011, AUSY issued free shares and stock options, with the following characteristics: Share-based payment General Meeting date Board Meeting date (allocation) Number of shares allocated Number of shares awarded at the end of the period Vesting period Lock-up period Exercise price conditions Free shares 2011 06/14/2011 11/25/2011 10,000 10,000 2 years 2 years N/A Stock options 2011 06/14/2011 10/20/2011 128,500 128,500 4 years 4 years €19.92 The “Convertible financial instruments” line thus includes the counterpart of the free shares and stock options (€504k), of the equity warrants (€442k) and of the BSAAR (€672k). NOTE 21 Financial liabilities Short-term debts Due under one year 6,581 4,048 1,570 21 (in €k) Bond issues Bank borrowings Other borrowings and associated debts Swaps and interest on Loans Miscellaneous BORROWINGS AND FINANCIAL LIABILITIES Long-term debts Due over one year 13,162 19,494 - Closing position 12/31/2011 19,743 23,542 1,570 21 Opening position 12/31/2010 19,743 44 538 13 12,220 32,656 44,876 20,338 In October 2009, the Company issued bonds with redeemable equity warrant (OBSAARs) with October 2012, October 2013 and October 2014 maturity dates, by thirds. 2011 Registration Document - AUSY 772012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=80http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=804 Consolidated financial statements Notes to the financial statements The bond component was recorded under long-term financial debts for €19,743k. As they are floating rate notes, an interest rate swap was carried out to hedge the rate at 2.312%. This derivative, with a market value of €393k as at December 31st 2010 (mark to market), is measured through shareholder equity. As of December 31st 2010, the sum of €152k was therefore posted to shareholder equity. The effective interest rate for the OBSAARs was 4.22%. The Company arranged a floating-rate syndicated credit line in April 2011. It drew down several tranches for a total of €23,395k. As these are floating rates, swaps were arranged at each drawdown to hedge the rates at: S S S 4.54% for €8,000k with an effective interest rate of 4.91%; 4.55% for €8,000k with an effective interest rate of 4.92%; 3.60% for €5,395k with an effective interest rate of 4.07%. These derivatives, with a market value of €516k at December 31st 2011 (mark to market), are measured through shareholder equity. As of December 31st 2010, the sum of €344k was therefore posted to shareholder equity. The AUSY goodwill was pledged as security for the syndicated loan. NOTE 22 Provisions (in €k) Provisions for pensions and retirement benefits TOTAL NON-CURRENT PROVISIONS Litigation provisions* Other provisions for contingencies and expenses TOTAL PROVISIONS FOR CONTINGENCIES TOTAL PROVISIONS * Opening position First-time 12/31/2010 consolidation Increase by capitalizing Depreciation reserves expenses Write-back (used provision) Write-back (non-used provision) Closing position 12/31/2011 315 315 2,009 103 103 703 402 402 - 95 95 294 -706 -985 915 915 1,315 48 2,057 2,372 597 1,300 1,403 402 1,118 1,412 1,507 -420 -1,126 -1,126 -985 -985 1,344 2,658 3,573 Litigation provisions concern social (70%) and commercial (30%) disputes. The provision for pensions was set using the following parameters: 12/31/2011 Discount rate Salary increase rate Inflation rate Retirement age 4.60% 1.64% 2.47% 65 years 12/31/2010 4.68% 1.64% 1.50% 65 years The changes break down as follows: (in €k) COMMITMENT AT OPENING First-time consolidation Services rendered Interest expenses Actuarial losses (Gains) COMMITMENT AT CLOSING For information: compensation paid 12/31/2011 315 103 93 2 402 915 0 12/31/2010 356 37 6 -84 315 0 78 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=81http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=81Consolidated financial statements Notes to the financial statements 4 11,731 582 12,313 NOTE 23 Non-current liabilities (in €k) Real estate acquisition debt - share due over one year Other non-current liabilities TOTAL OTHER NON-CURRENT LIABILITIES Closing position 12/31/2011 21,187 5,048 26,235 Opening position 12/31/2010 This is essentially the amount over more than one year of the earn-out the deferred payment of the acquisition price of the Group’s subsidiaries or other liabilities with respect to sellers from the Group's subsidiaries. NOTE 24 Trade (in €k) Accounts payable - Trade Accounts payable - Trade, invoice to be received TOTAL ACCOUNTS PAYABLE - TRADE Closing position 12/31/2011 11,347 4,659 16,005 Opening position 12/31/2010 6,768 2,147 8,915 NOTE 25 Tax liabilities (in €k) Corporate Income Tax TOTAL TAX LIABILITIES Closing position 12/31/2011 262 262 Opening position 12/31/2010 2,764 2,764 NOTE 26 Other current liabilities (in €k) Advances and payments on account - Trade Asset acquisitions debt Personnel and social organizations - Liabilities VAT and other taxes payable Other liabilities Equalization account TOTAL OTHER CURRENT LIABILITIES Closing position 12/31/2011 2,742 1,700 38,479 23,468 1,650 4,630 72,668 Opening position 12/31/2010 405 5,358 25,945 13,381 1,266 2,403 48,758 2011 Registration Document - AUSY 792012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=82http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=824 (in €k) Payroll Consolidated financial statements Notes to the financial statements NOTE 27 Employee payroll and benefits expenses FY 2011 -131,188 -55,389 -95 -186,672 FY 2010 Restated -84,175 -36,431 -42 -2,028 -122,676 Payroll and benefits expenses Pension commitments Employee profit-sharing TOTAL PAYROLL AND BENEFITS EXPENSES The amount of employee profit-sharing, €2,599k, as well as €208k of related expenses, was classed in Other operating income and expenses in 2011, because it was linked fully to the Research tax credit obtained. NOTE 28 Provisions and allocations relating to depreciation and amortization (in €k) Amortization and depreciation expenses (write-backs) Increase in/write-back of impairment of current assets Increase in/write-back of operating provisions TOTAL FY 2011 -1,264 271 1,771 778 FY 2010 -792 315 864 387 NOTE 29 Other operating income and expenses The amount of other operating income and expenses is significant for the period. It breaks down as follows: (in €k) Research Tax Credit (CIR) Fees relating to the Research Tax Credit Share of employee profit sharing related to Research tax credit Costs associated with acquisitions of subsidiaries Expenses related to unused premises Miscellaneous OTHER OPERATING INCOME AND EXPENSES (1) FY 2011 9,105 -1,153 -2,807 -645 -2,064 -93 2,343 (1) Following the acquisition of the APTUS group, AUSY’s and APTUS’s employees were integrated into the same sites. As a result, two premises are unoccupied. In accordance with IAS 37, the amount of rent remaining was recognized as a liability for financial year 2011. The assets for the premises were also fully written down. 80 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=83http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=83Consolidated financial statements Notes to the financial statements 4 FY 2010 -24 -820 -13 -857 -500 314 -1,043 NOTE 30 Financial Result (in €k) Financial expenses on OCEANES Financial expenses on OBSAAR Interest on borrowings SUB-TOTAL NET FINANCING COSTS Earn-out discounting Other financial income and expenses FINANCIAL RESULT FY 2011 -820 -757 -1,577 -692 -170 -2,440 NOTE 31 Income tax (in €k) Current income tax CVAE Deferred taxes TOTAL Net consolidated income Income tax Income before income tax* Pro forma income tax Impact of CVAE Impact of permanently Non-deductible expenses Miscellaneous* Actual tax expenses * Miscellaneous: CIR impact Other 3,070 111 3,182 -11 -11 FY 2011 -2,139 -3,030 -385 -5,554 13,428 -5,554 18,981 -6,327 -2,020 -347 3,182 -5,554 FY 2010 -4,952 -6,796 119 -6,677 8,400 -6,677 15,077 -5,026 -1,229 -373 -11 -6,677 The Pro forma Tax Rate is the Parent Company’s effective tax rate, i.e. 33.33% in 2011 and 2010. As of the closing of the year 2011, the Group decided to characterize the CVAE (Value-added Tax for French companies) component of CET (French local business tax), a tax introduced by the 2010 Finance Law, as a tax on profit in order to ensure consistency with the accounting treatment of similar taxes in other foreign countries. The effective tax rate for the Group is 29.3%, which includes the CVAE for a gross total of €3,020k (compared with 44.3% in 2010). If the CVAE had not been taken into account in the tax on revenue, the effective tax rate for the Group would have been 15.8% (36.5% in 2010) largely as a result of the Research Tax Credit. 2011 Registration Document - AUSY 812012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=84http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=844 Outstanding Treasury TOTAL Consolidated financial statements Notes to the financial statements NOTE 32 Earnings per share Closing position 2011 Number of Shares Single 4,208,072 -4,051 4,204,021 13,427,865 3.19 Opening position 2010 Diluted 4,208,072 -4,051 35,112 219,195 4,458,328 13,427,865 3.01 Single 3,649,331 -336,144 3,313,187 7,963,451 2.40 Diluted 3,649,331 -336,144 877,480 4,190,667 7,963,451 1.90 Related to equity warrants Related to OBSAAR Total net income (in €) TOTAL TOTAL EARNINGS PER SHARE in € NOTE 33 Statement of cash flows explained The effect of changes in scope on cash and cash equivalents breaks down as follows: (in €) Disbursements related to share acquisition Cash and cash equivalents of companies acquired NET DISBURSEMENTS Closing position 12/31/2011 -31,918 2,311 -29,606 Opening position 12/31/2010 - NOTE 34 Off-balance sheet commitments (in €k) Rental agreements Commitments received Guarantees and endorsements (given) Rental agreements Commitments given Closing 12/31/2011 330 330 572 22,788 23,359 Under one year One to five years 330 330 16 7,319 7,335 556 15,356 15,912 Over five years 112 112 Closing 12/31/2010 124 124 16 16,768 16,784 In addition, the Company has received other commitments in the form of liability guarantees as part of its acquisitions. In essence, these guarantees cover the tax and social risks prior to the acquisition. 82 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=85http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=85Consolidated financial statements Information on the pro forma statements 4 2010 1,028 21 -5,431 2 -5,432 52 52 1,164 1,164 NOTE 35 Information on related parties (in €k) 2011 Members of the Board of Directors • Total compensation, excluding free shares • Provisions for retirement commitments on the closing date Transactions with non-consolidated companies (1) Services External expenses Financial result TOTAL INCOME STATEMENT Other current assets TOTAL ASSETS Accounts payable – Trade TOTAL LIABILITIES (1) Concerns the subsidiary Pentalog Technology, consolidated according to the equity method. 1,057 61 78 -6,528 1 -6,449 0 0 1,024 1,024 NOTE 36 Employees As at December 31st 2011, the total headcount is 3,630, vs. 2,300 at end-2010. The average headcount for the period was 3,504 for 2,220 in 2010. 4.7. INFORMATION ON THE PRO FORMA STATEMENTS 1.1. REGULATORY FRAMEWORK 1.2. This pro forma financial information is presented pursuant to AMF instruction no. 2005-11 of December 13th 2005, appendix II, indicating that if the size of the acquiring company changes by more than 25%, pro forma financial information must be presented. This pro forma financial information was drawn up in accordance with the stipulations of Appendix II “Pro forma financial information module” of European Commission Regulation no. 809/2004 and with the recommendations of the CESR issued in February 2005 concerning the preparation of the pro forma financial information on the prospectus, mentioned in this regulation no. 809/2004. SCOPE OF THE PRO FORMA FINANCIAL INFORMATION The pro forma financial information presented takes the merger of APTUS with the AUSY Group into account. However, the acquisition of ELAN GmbH and of its subsidiaries does not fall within the criteria set by AMF instruction no. 2005-11 of December 13th 2005. 1.3. ACCOUNTING POLICIES AND METHODS The accounting policies and methods used to prepare the pro forma financial information (balance sheets and income statements for 2010 and 2011) are the same as those used by AUSY on the 2011 balance sheet date. In particular, as explained above, for financial years 2010 and 2011, the CVAE is entered as a tax expense. 2011 Registration Document - AUSY 832012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=86http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=864 S S S S S Consolidated financial statements Information on the pro forma statements Assumptions retained for the preparation of the pro forma financial information: the APTUS group is consolidated on the basis of aggregating the corporate financial statements of the various entities comprising APTUS: restated for the adjustments required to ensure compliance with AUSY’s accounting rules and methods, after elimination of inter-company balances and securities held; as control of APTUS was taken on February 1st AUSY’s consolidated income statement, presented previously, therefore incorporates the APTUS group over 11 months. The pro forma income statement relates to the entire financial year; the balance sheet drawn up on December 31st 2010 presents a financial statement including the funding of the APTUS acquisition, without taking into account the measures actually taken to complete the acquisition (€15m capital increase on March 1st 2011 and implemented at end-April 2011, syndicated line of credit for €32M, €23M of which has been drawn down to date); the balance sheet at December 31st 2010 was prepared on the basis of an acquisition funding assumption at the start of financial year 2010 in the amount of available cash, supplemented by debt financing; the consolidated takeover date is February 1st 2011; purchase price is measured and allocated on this date. As a result, the difference S between the net value of the assets acquired on February 1st 2011 and the net value on December 31st 2010, given above, namely €331k, was recognized in consolidated reserves. the Pro f orma Consolidated Income Statement is provided exclusively for informational purposes and does not represent an indication of the operating revenue or of the financial situation of the consolidated company that would have been realized if the operation had effectively been introduced on the indicated date. As it represents a hypothetical situation, the Income Statement is also not indicative of the revenue from operating income or of the financial future of the consolidated company. all the pro forma adjustments directly refer to operation. Only the adjustments that should have a recurring impact on the consolidated financial statements of the company were taken into account. only adjustments that can be concretely documented and estimated in a reliable manner are taken into account. For example, the unaudited Pro forma Consolidated Income Statement does not include any potential cost savings resulting from the elimination of certain expenses or the accomplishment of synergies. It also does not take into account particular elements such as future restructuring and integration costs that could be incurred in the course of business. S S S S 1.4. COMPARATIVE INCOME STATEMENT AUSY Pro forma 12/31/2011 299,647 -84,089 -190,647 -6,025 -1,283 2,104 -150 19,558 6.5% 2,343 21,901 7.3% -1,594 -1,594 -862 19,445 -5,784 13,660 109 13,770 13,770 - Income statement (in €k) Revenue External expenses Payroll and benefit expenses Taxes other than Income Tax Increase in/Write-back of amortization Increase in/Write-back of depreciations and provisions Changes in work-in-progress and finished product inventories Other operating income and expenses Current operating income % Other operating income and expenses OPERATING INCOME % Gross financing costs Net financing costs Other financial income and expenses INCOME ON ORDINARY ACTIVITIES BEFORE INCOME TAXES Income taxes INCOME ON ORDINARY ACTIVITIES AFTER INCOME TAXES Share of investments in associates’ net income TOTAL NET INCOME Group share Non-controlling interests’ share AUSY Pro forma 12/31/2010 261,857 -69,031 -171,094 -5,096 -1,088 113 165 -862 14,964 5.7% -443 14,521 5.5% -1,087 -1,087 -186 13,248 -6,618 6,630 301 6,931 6,494 436 84 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=87http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=87Consolidated financial statements Information on the pro forma statements 4 Pro forma 12/31/2010 261,856 -69,031 -171,094 -5,096 -1,088 113 165 -862 14,963 -443 14,520 -1,087 -1,087 -186 BREAKDOWN OF THE 2010 PRO FORMA INCOME STATEMENT AUSY 12/31/2010 197,660 -54,610 -122,676 -3,894 -792 1,179 165 -637 16,395 -576 15,819 -857 -857 -186 14,776 -6,677 8,099 301 8,400 7,963 436 (in €k) Revenue External expenses Payroll and benefit expenses Taxes other than income tax Increase in/Write-back of amortization Increase in/Write-back of depreciations and provisions Changes in work-in-progress and finished product inventories Other operating income and expenses Current operating income Other operating income and expenses OPERATING INCOME Gross financing costs Net financing costs Other financial income and expenses INCOME ON ORDINARY ACTIVITIES BEFORE INCOME TAXES Income taxes (and CVAE) INCOME ON ORDINARY ACTIVITIES AFTER INCOME TAXES Share of investments in associates’ net income TOTAL NET INCOME Group share Non-controlling interests’ share APTUS 12/31/2010 Aggregation 64,729 -14,421 -48,433 -1,922 -296 -684 -225 -1,252 133 -1,119 -229 -229 -1,349 28 -1,321 -1,321 -1,321 - Adjustments -533 15 720 -382 -180 -180 - -180 31 -149 -149 -149 - 13,248 -6,618 6,630 301 6,931 6,494 436 The APTUS “Aggregation” column represents the sum of the corporate financial statements of the various entities constituting the APTUS group, prior to its constitution, after elimination of inter-company balances and of securities held by FINANCIÈRE APTUS SA, the holding company at the head of the Group. The “Adjustments” column presents the following items: S S S S separation of reporting periods for committed-results contracts; long-term commitments to personnel; recording of deferred tax entries; reclassification of CVAE expenses under taxes. 2011 Registration Document - AUSY 852012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=88http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=884 (in €k) Revenue Consolidated financial statements Information on the pro forma statements BREAKDOWN OF THE 2011 PRO FORMA INCOME STATEMENT AUSY 12/31/2011 293,815 -82,884 -186,672 -5,911 -1,264 2,042 -158 18,968 2,343 21,312 -1,577 -1,577 -862 18,872 -5,554 13,318 109 13,428 13,428 - APTUS 12/31/2011 Aggregation 5,670 -1,205 -3,975 -174 -19 62 7 367 367 -17 -17 350 350 350 350 - Adjustments 162 60 222 222 222 -231 -9 -9 -9 AUSY Pro forma 12/31/2011 299,647 -84,089 -190,647 -6,025 -1,283 2,104 -150 19,558 2,343 21,901 -1,594 -1,594 -862 19,444 -5,785 13,660 109 13,770 13,770 - External expenses Payroll and benefit expenses Taxes other than income tax Increase in/Write-back of amortization Increase in/Write-back of depreciations and provisions Changes in work-in-progress and finished products inventories Other operating income and expenses Current operating income Other operating income and expenses OPERATING INCOME Gross financing costs Net financing costs Other financial income and expenses INCOME ON ORDINARY ACTIVITIES BEFORE INCOME TAXES Income Taxes INCOME ON ORDINARY ACTIVITIES AFTER INCOME TAXES Share of investments in associates’ net income TOTAL NET INCOME Group share Non-controlling interests’ share The APTUS “Aggregation” column represents the sum of the corporate financial statements of the various entities constituting the APTUS group, prior to its constitution, after elimination of inter-company balances and of securities held by FINANCIÈRE APTUS SA, the holding company at the head of the Group. The “Adjustments” column presents the following items: S S S S separation of reporting periods for committed-results contracts; long-term commitments to personnel; recording of deferred tax entries; reclassification of CVAE expenses under taxes. 86 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=89http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=89Consolidated financial statements Information on the pro forma statements 4 65,130 447 2,964 536 1,006 2,271 72,354 165 89,905 195 6,007 713 96,985 169,338 3,668 16,707 -6,092 -25 1,627 20,668 36,553 763 763 37,316 25,344 365 15,917 41,625 7,208 3,397 12,027 2,764 65,001 90,396 132,022 169,338 1.5. COMPARATIVE BALANCE SHEET Actual 12/31/2011 79,369 664 3,447 624 1,251 2,299 87,653 5 128,970 3,675 10,156 5,081 147,887 235,540 4,495 30,932 -83 -37 1,618 34,995 71,920 0 0 71,920 32,656 915 26,235 59,806 12,220 2,658 16,005 262 72,668 103,814 163,620 235,540 Balance sheet (in €k) Goodwill Non-current intangible assets Property, plant and equipment Investments in associates Other non-current financial assets Deferred taxes Non-current assets Inventory and work-in-progress Accounts receivable Tax receivables Other current assets Marketable securities and other investments Cash and cash equivalents Current assets Non-current assets and groups of assets intended for sale TOTAL ASSETS Share capital Other paid-in capital Treasury shares Other reserves Convertible financial instruments Accumulated earnings Total shareholder equity, Group share Non-controlling interest Total non-controlling interests TOTAL SHAREHOLDER EQUITY Borrowings and financial liabilities Commitments to personnel Deferred taxes Other non-current liabilities Total Non-current liabilities Bank borrowings and facilities (current portion) Provisions Accounts payable Tax liabilities Other current liabilities Total current liabilities Total liabilities related to a group of assets intended for sale TOTAL LIABILITIES TOTAL LIABILITIES Pro forma 12/31/2010 2011 Registration Document - AUSY 872012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=90http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=904 (in €k) Goodwill Consolidated financial statements Information on the pro forma statements BREAKDOWN OF THE PRO FORMA BALANCE SHEET AT DECEMBER 31ST 2010 AUSY 12/31/2010 42,382 421 2,142 536 786 1,158 47,425 165 66,709 4,626 2,566 11,617 85,683 133,107 3,668 16,707 -6,092 -25 1,627 20,999 36,885 763 763 37,648 20,151 315 12,313 32,779 187 2,057 8,915 2,764 48,758 62,680 95,459 133,107 19,361 19,748 8,098 7,918 9,102 8,564 132,021 169,337 19,749 724 127 -464 387 387 876 318 1,194 838 3,112 14,218 18,168 525 8,048 1,500 1,500 -180 -180 -180 50 50 7,021 502 -539 4,317 3,286 7,602 312 -539 -127 7,918 8,565 -724 169,337 3,668 16,707 -6,092 -25 1,627 20,668 36,553 763 763 37,316 25,344 365 15,917 41,625 7,208 3,397 12,027 2,764 65,001 90,396 APTUS 12/31/2010 Aggregation 26 822 220 57 1,125 10,332 195 7,383 713 18,623 Adjustments 1,056 1,056 12,864 -6,002 6,862 Acquisition 22,748 22,748 -2,566 -11,617 -14,183 Pro forma 12/31/2010 65,130 447 2,964 536 1,006 2,271 72,354 165 89,905 195 6,007 713 96,985 Non-current intangible assets Property, plant and equipment Investments in associates Other non-current financial assets Deferred Taxes Non-current assets Inventory and work-in-progress Accounts receivable Tax receivables Other current assets Marketable securities and Other Investments Cash and cash equivalents Current assets Non-current assets and groups of assets intended for sale TOTAL ASSETS Share capital Other paid-in capital Treasury shares Other reserves Convertible financial instruments Accumulated earnings (2) TOTAL SHAREHOLDER EQUITY, GROUP SHARE Non-controlling interests (2) TOTAL NON-CONTROLLING INTERESTS TOTAL SHAREHOLDER EQUITY Borrowings and financial liabilities Commitments to personnel Other non-current liabilities TOTAL NON-CURRENT LIABILITIES Bank borrowings and facilities (current portion) Provisions Accounts payable Tax liabilities Other current liabilities Total current liabilities Total liabilities related to a group of assets intended for sale TOTAL LIABILITIES TOTAL LIABILITIES The APTUS “Aggregation” column represents the sum of the corporate financial statements of the various entities constituting the APTUS group, prior to its constitution, after elimination of inter-company balances and of securities held by FINANCIÈRE APTUS SA, the holding company at the head of the Group. The “Adjustments” column presents the impact of the following items: S S S S reconsolidation of receivables sold under factoring contracts; recording of deferred tax entries; separation of reporting periods for committed-results contracts; recognition of the goodwill from the acquisition; The acquisition column represents the effects of the acquisition on the Group’s financial statements, based on the assumption, in accordance with accounting standards, that the APTUS group was acquired on January 1 2011. 88 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=91http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=91Consolidated financial statements Statutory Auditor's report 4 4.8. STATUTORY AUDITOR'S REPORT 4.8.1. Statutory Auditor's report on the consolidated financial statements Year ending December 31 2011 Dear Shareholders, In compliance with the assignment entrusted to us by your General Meeting, we hereby report to you, for the year ended December 31, 2011, on: S S S the audit of the attached consolidated financial statements of Ausy SA; the justification of our assessments; the specific verification required by law. These consolidated financial statements have been approved by the Board of Directors. Our role is to express an opinion on these financial statements based on our audit. 1. OPINION ON THE CONSOLIDATED FINANCIAL STATEMENTS We conducted our audit in accordance with the professional standards applicable in France. Those standards require that we plan and perform the audit to obtain reasonable assurance on whether the consolidated financial statements are free of material misstatement. An audit involves verifying, by using sampling techniques or other methods of selection, the amounts and disclosures in the consolidated financial statements. An audit also includes evaluating the appropriateness of accounting policies used and of accounting estimates made, as well as the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. In our opinion the consolidated financial statements give a true and fair view of the net assets, the financial position and the net income of the whole constituted by the persons and legal entities included in the consolidation, in accordance with IFRS guidelines, as adopted by the European Union. Without qualifying the opinion expressed above: S S we draw your attention to Note 3.1 of the notes to the financial statements, which sets out the change made to accounting policies for the recognition of provisions for retirement indemnities during the financial year; we also draw your attention to Note 3.2 to the financial statements, which sets out the change to the “presentation methods” for the Contribution to Corporate Value Added (CVAE) in the Economic and Regional Contribution (CET) in the profit and loss statement, which was classified as a tax on income in the financial statements for the financial year ending December 31, 2011. 2. JUSTIFICATION OF OUR ASSESMENTS In accordance with the provisions of Article L. 823-9 of the French Commercial Code relating to the justification of our assessments, we draw the following matters to your attention: S as mentioned in the first part of this report, Notes 3.1 “Change in accounting policies” and 3.2 “Change in presentation methods” to the financial statements set out the changes made to accounting policies and presentation methods relating to the recognition of provisions for retirement indemnities, and to the recognition of the Contribution to Corporate Value Added (CVAE) in the Economic and Regional Contribution (CET) in the profit and loss statement as a tax on income. In the context of our assessments of the accounting principles used by your Company, we have verified the appropriateness of these changes and of their presentation; goodwill, the net amount of which on the balance sheet at December 31, 2011 stood at €79,369,000, was impairment-tested according to the conditions set out in Note 7 to the consolidated financial statements. We have verified the implementation conditions of these impairment tests as well as the cash flow projections and assumptions used, and have verified that Note 7 to the consolidated financial statements gives the appropriate information. S These assessments were made as part of our audit of the consolidated financial statements taken as a whole, and therefore contributed to the opinion we formed which is expressed in the first part of this report. 2011 Registration Document - AUSY 892012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=92http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=924 3. Consolidated financial statements SPECIFIC VERIFICATION As required by law and in accordance with professional standards applicable in France, we have also verified the information presented in the Group’s Management report. We have no observation to make as to its fair presentation and its consistency with the Consolidated Financial Statements. Paris La Défense, April 24 2012 KPMG Audit IS Paris, April 24 2012 Grant Thornton French member of Grant Thornton International Jean-Pierre Valensi Partner Muriel Boissinot-Schneider Partner 4.8.2. Pro forma information report Dear Shareholders, In our capacity as Statutory Auditors, and pursuant to EC Regulation no. 809/2004, we have drawn up this report on the pro forma information provided by Ausy SA for the 2011 financial year, as included in Paragraph 4.7 of Chapter 4 of the Company’s Registration Document prepared for the financial year ending December 31, 2011. This pro forma information has been prepared for the sole purpose of illustrating the impact that the acquisition of the Aptus Group might have had on Ausy SA’s balance sheet and income statement: S S at December 31, 2010 if the transaction had taken effect at January 1, 2010; and on the 2011 financial year, if the transaction had taken effect at January 1, 2011. By its very nature, this information describes a hypothetical scenario, and does not necessarily represent the financial position or performance that might have been recorded if the transaction or event had occurred at an earlier date than when it actually occurred. This Pro forma information has been prepared under your responsibility, pursuant to the provisions of EC Regulation no. 809/2004 regarding Pro forma information. Our duty is to express a conclusion based on our audit, on the appropriateness of the way in which the pro forma information was prepared in the terms required by Point 7 of Appendix II of EC Regulation no. 809/2004. We performed the checks that we deemed necessary in relation to this assignment, in view of the professional standards of the French National Association of Statutory Auditors. These checks, which do not involve examining the underlying financial information used in preparing the pro forma information, consisted primarily in verifying that the basis on which this pro forma information was prepared was consistent with the source documents, in examining the evidence that justified the pro forma restatements, and in holding meetings with Ausy SA’s Management team in order to gather the information and explanations that we deemed necessary. In our opinion: S S the Pro forma information has been appropriately drawn up on the stated basis; this basis complies with the issuer’s accounting policies. This report has been issued for the sole purpose of filing the Registration Document with the AMF and, where applicable, of the public offering in France and in other European Union Member States where a prospectus incorporating this Registration Document, as approved by the AMF, is likely to be provided, and may not be used in another context. Paris La Défense, April 24 2012 KPMG Audit IS Paris, April 24 2012 Grant Thornton French member of Grant Thornton International Jean-Pierre Valensi Partner Muriel Boissinot-Schneider Partner 90 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=93http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=935 Company financial statements 5.1. BALANCE SHEET 92 93 5.2. INCOME STATEMENT 5.3. NOTES TO THE FINANCIAL STATEMENTS 5.4. KEY FIGURES FOR THE LAST FIVE YEARS 5.5. STATUTORY AUDITORS’ REPORT 94 107 108 2011 Registration Document - AUSY 912012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=94http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=945 (in €k) Company financial statements Balance sheet 5.1. BALANCE SHEET Amortization & provisions 2,995 4,434 13 7,442 589 589 8,031 Net 12/31/2011 37,021 2,363 29,185 68,569 167 72,500 25,013 83 35,573 133,335 1,466 1,097 204,468 4,495 32,191 367 15,902 18,484 71,438 Net 12/31/2010 10,637 1,351 25,863 37,851 55 34,594 6,971 2,684 29,234 73,538 656 1,097 113,142 3,668 18,004 356 9,058 6,854 37,940 2,009 20,840 7 10 8,474 38,010 3,812 2,040 75,202 113,142 Assets Non-current intangible assets Property, plant and equipment Non-current financial assets TOTAL NON-CURRENT ASSETS Advances and payments on account Accounts receivable - Trade Other receivables Marketable securities Cash and cash equivalents TOTAL CURRENT ASSETS Prepaid expenses Deferred expenses Bond redemption premiums TOTAL ASSETS Note 3-1 3-1 3-1 3-2 3-2 3-2 3-4 3-4 Gross 40,016 6,798 29,198 76,012 167 73,088 25,013 83 35,573 133,924 1,466 - 3-6 1,097 212,499 Liabilities Share capital Issue, merger & contribution premiums Statutory reserve Balance brought forward Income for the period Regulated provisions TOTAL SHAREHOLDER EQUITY Provisions for contingencies and expenses Other bond issues Loans from financial institutions Borrowings and other financial debts Advances and payments on account Accounts payable - Trade Tax, personnel and social security liabilities Other operating liabilities Deferred income LIABILITIES TOTAL LIABILITIES 3-10 3-10 3-10 3-10 3-8 3-9 3-9 3-9 3-7 3-7 3-7 3-7 3-7 2,663 20,929 23,704 445 5 13,580 58,109 9,085 4,509 133,030 204,468 92 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=95http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=95Company financial statements Income statement 5 12/31/2010 157,652 3,838 161,490 -39,854 -5,518 -101,628 -2,233 -299 -149,532 11,958 1,101 -606 12,453 157 -134 23 -1,729 -3,893 6,854 5.2. INCOME STATEMENT (in €K) Revenue Write-back of depreciation and provisions TOTAL OPERATING INCOME Purchases and external expenses Taxes other than income tax Employee payroll and benefits expenses Depreciation, amortization and provisions Other expenses TOTAL OPERATING EXPENSES OPERATING INCOME Total Financial income Total Financial expenses INCOME ON ORDINARY ACTIVITIES BEFORE INCOME TAXES Extraordinary income Extraordinary expenses EXTRAORDINARY INCOME Statutory employee profit-sharing Income tax NET INCOME 4-5 4-4 4-4 4-3 4-3 Note 4-1 4-2 12/31/2011 199,500 3,342 202,843 -49,304 -7,781 -135,580 -1,346 -468 -194,479 8,364 8,289 -2,401 14,252 1,354 -1,704 -350 -2,599 7,181 18,484 2011 Registration Document - AUSY 932012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=96http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=965 NOTE 1 NOTE 2 NOTE 3 NOTE 4 NOTE 5 Company financial statements Notes to the financial statements 5.3. NOTES TO THE FINANCIAL STATEMENTS APPENDIX Highlights and events after the reporting period Accounting policies and methods Notes relative to balance sheet items Notes to the income statement Off-balance sheet commitments 94 96 97 103 106 NOTE 1 Highlights and events after the reporting period MARCH 2011: €15M MINIMUM CAPITAL INCREASE, WITH PRE-EMPTION RIGHTS; SIPAREX AND CDC ENTREPRISES TAKE STAKES IN THE GROUP As part of its expansion plans, the AUSY Group announced the launch of a €15M rights issue on March 1st 2011. The issue is detailed in the prospectus filed with the AMF on February 28th 2011 under no. 11-0056. The capital increase was completed with retention of pre-emption rights to enable the Group’s shareholders to participate in the offering. The proceeds provide AUSY with additional resources, strengthens its equity base and enhances access to further bank financing. The subscription period extended from March 14th to March 22nd 2011 (inclusive) at a price of €19 per share (a discount of 16% relative to the share closing price on February 25th 2010). Siparex and the Caisse des Dépôts (FCID 2) expressed their interest in supporting the Group’s growth during this issue and teamed up with Managers in a joint holding, HISAM, a simplified joint stock company created in January 2011. Prior to the start of the subscription period, HISAM acquired 129,000 AUSY treasury shares at €21 per share. The stakes taken by these two new partners are a strong sign of confidence in the Group, and will strengthen its control. FEBRUARY 2011: APTUS GROUP ACQUISITION AUSY acquired all of the capital and voting rights in the APTUS group on February 9, 2011. As a result of the transaction, AUSY has increased its headcount by almost 700 people, giving it critical mass in the Engineering and Technology Consulting market and augmenting its capacity and offering. This acquisition enables AUSY to strengthen its presence with key clients, the latter continuously pruning their providers’ short-list by selecting those which have large capacities in terms of staff, specific technical knowledge and wide geographical presence. It enables AUSY to acquire major skills in the high-growth potential energy sector. AUSY now benefits from APTUS’s energy expertise: its many references in this sector act as new growth drivers for the Group. In its key sectors (Aeronautics and Defense amongst others), AUSY will also be in a position to leverage the additional services provided by APTUS. This new enlarged structure meets the expectations of prime producers, who aim to reduce their provider shortlists and, as a result, to accentuate their technological know-how. In addition, this acquisition opens up new markets for the Group, particularly in Spain. The acquisition was completed by AUSY Participation, a wholly-owned subsidiary of AUSY. AUSY Participation was absorbed by AUSY through the transfer of all assets and liabilities on May 31st 2011. The acquisitions in France of APTUS SA, FINANCIÈRE APTUS, APTUS Bordeaux, APTUS Orléans and APTUS Sophia were absorbed through the transfer of all assets and liabilities to AUSY on June 30th 2011. 94 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=97http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=97Company financial statements Notes to the financial statements 5 APRIL 2011: GOODWILL ACQUISITION OF APX Q2 2011 saw the AUSY Group finalize the goodwill acquisition of APX, a company with some 130 employees operating in the IS sector. The acquisition reinforces AUSY’s presence in the Rhône Alpes region of France. Moreover, a similar application was submitted for financial year 2010 for a Research Tax Credit of €3.7M. As the technical documents are currently being prepared, no income has been recognized in the Group’s accounts at December 31st 2011. TAX AUDIT The tax authorities conducted an audit of the accounts for financial years 2008 and 2009. To date, the definitive conclusions have not been issued to the Company, except for an additional tax assessment totaling €84,000 for VAT mainly concerning scrapping of leasehold improvement. The Management Report for the previous year stated that at the end of December 2010, the Company had filed a lawsuit seeking to collect €8.6M in research tax credits for 2008 and 2009 due to it in respect of work carried out by its engineers on accredited client programs. The income relating to this claim had not been recognized as the technical documentation relating to the lawsuit was in the process of being drafted. The documentation was finalized during the year, and the tax authority proceeded to the settlement of the amount due. Consequently, the consolidated financial statements for the year include this income under “Other operating income and expenses”. The tax authority carried out an inspection for the 2008 and 2009 financial years, but has yet to announce the outcome. A lawsuit has also been filed to claim research tax credits of around €3.7M for 2010. As the technical documentation is currently being prepared, no income was recognized in the Group’s 2011 financial statements in relation to this lawsuit. APRIL 2011: LINE OF CREDIT OBTAINED On April 7th 2011, the AUSY Group concluded a deal for a five-year syndicated line of credit totaling €32M. JULY 2011: ACQUISITION OF ELAN GMBH On July 18th 2011, AUSY completed the acquisition of a 51% stake in ELAN GmbH, through its German affiliate, AUSY GmbH. A subsidiary of the German group EDAG, the company was linked to AUSY since 2009 through a joint venture formed for the purposes of the European aeronautics market. ELAN has a headcount of 200 and posted revenue in excess of €25M in 2010. With its main location in Germany, ELAN will also enhance AUSY’s presence in the Toulouse region through its ELAN France subsidiary (whose assets and liabilities were transferred in full to AUSY on December 31st 2011) and contribute to the Group’s international growth with a presence in Spain through ELAN Spain (merged with AUSY’s Spanish subsidiary, APTUS España, to create AUSY Servicios de Ingeneria). NOVEMBER 2011: ACQUISITION OF EXALEN The Company acquired the 40% of capital it did not already own in its subsidiary Exalen. A merger by the transfer of all assets and liabilities was initiated after the acquisition and is effective at the closing date. EVENTS AFTER THE REPORTING PERIOD On January 10th 2012, the Extraordinary General Meeting of AUSY’s shareholders voted to extend the exercise period of the stock warrants issued by the Board of Directors’ Meeting of August 28th 2007, extending the final exercise date from October 15th 2012 to October 15th 2015. The shareholders also voted to amend the parity for the exercise of these stock warrants, increasing the number of warrants for one AUSY common share from 22 to 28. The price remained unchanged at €18. This new potential dilution now stands at 173,692 shares compared with 224,157 shares before. The equity warrant holders approved these changes during the General Meeting held on January 10th 2012. RESEARCH TAX CREDIT At the end of December 2010, AUSY filed a lawsuit seeking to collect the Research Tax Credit amounts due to it for its engineers’ work on clientaccredited programs with respect to 2008 and 2009 for an a2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=98http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=985 2.1. S S S S Company financial statements Notes to the financial statements NOTE 2 Accounting policies and methods The Company applied CRC Regulation no. 2004-01 relative to the accounting treatment of mergers and similar transactions for operations from January 1st 2004. These merger unfavorable variances are impairment tested on an annual basis, following which an impairment is recognized when the total amount of the merger unfavorable variance and the gross value of the securities is greater than the value of the Company. This company value is determined on cash flow projections based on the budget data approved by management. The AUSY Company incurs no expenses related to research activities to gain new scientific and technical knowledge. However, should that be the case, these would be recorded as expenses when incurred. Expenses related to development activities for the improvement of products and new processes are posted as balance sheet assets if the product or the process is ruled both technically and commercially viable and the Group intends to complete its development. PREPARATION BASIS OF THE FINANCIAL STATEMENTS The 2011 financial statements were prepared in accordance with the generally accepted accounting standards in France (CRC Regulation no. CRC 99-03) and with the following elements in particular: Conservatism; Continuity of operation; Consistency of accounting methods from one period to another; Independence of financial years. The basic method for the measurement of accounting items is the historic cost method. The annual financial statements are prepared and presented in thousands of euro. 2.2. S RELATED PARTY TRANSACTIONS Related party transactions include, in particular, transactions with: members of the Company’s key management personnel, defined as the persons in charge of planning, management and control of the Company’s activities, including the members of the Board of Directors, as well as close members of their families; entities controlled by the Company; entities over which the Company has control or joint control; entities controlled or held jointly by one of the Company’s Directors or Corporate Officers. 2.4. PROPERTY, PLANT AND EQUIPMENT S S S Property, plant and equipment are valued at their acquisition cost. The straight-line depreciations are mainly calculated according to their estimated useful life. The following economic life periods are used: layout and installations over two to eight years; transport equipment over two to five years; office equipment over five years; computer equipment over two to five years; and furniture over two to eight years. 2.5. 2.3. NON-CURRENT INTANGIBLE ASSETS The non-current intangible assets include licenses, software, goodwill as well as unfavorable variances due to mergers. These non-current assets are posted at their acquisition costs. They are straight-line depreciated over their respective period of use, from two to 20 years. NON-CURRENT FINANCIAL ASSETS Non-current equity interests in subsidiaries The gross value of non-current equity interests in subsidiaries posted to the balance sheet is recorded at acquisition cost, which includes the expenses directly attributable to their posting as non-current assets. The acquisition price of non-current equity interests in subsidiaries takes into account the price paid upon acquisition and the potential additional variable price based on the activity and future incomes of the acquired company. A provision for impairment is booked if the year-end valuation of noncurrent equity interests in subsidiaries, based on their value in use, is lower than their net book value. The value in use of securities is determined according to estimated discounted future cash flows, according to the same methods and assumptions used to measure the assets of CGUs in the consolidated financial statements. Licenses and software The licenses and brand names purchased correspond to non-current assets. The straight-line depreciation period is set a2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=99http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=99Company financial statements Notes to the financial statements 5 2.6. ACCOUNTS RECEIVABLE 2.10. RECOGNIZED INCOME Proceeds of sales are recorded when the risks and benefits are transferred to the acquirer and when their amount may reliably be measured. Accounts receivable are measured at par value. They are valued as at the closing date and are, if applicable, depreciated to take into account the collection difficulties that may occur. 2.7. MARKETABLE SECURITIES Cost-plus services Revenue for cost-plus services, based on units of information technology sold, is recognized as and when the services are provided. Marketable securities composed of money-based unit trusts posted to the balance sheet are valued at their historical cost. 2.8. DEFERRED EXPENSES Work packages If the completion of long-term contracts may reliably be estimated, the proceeds are recognized according to the contract stages. According to the type of contract, the proceeds are recognized as and when the contract milestones are reached, work units are delivered or the work progresses. Where it is not possible to reliably estimate the results of a contract, the revenue is only recognized to the extent of contract costs incurred that will probably be recognized. The potential losses on contracts are analyzed at each closing date and provisions for losses at completion are booked if and when identified. Provisions for losses at completion are booked when it becomes probable that the overall estimated costs for a contract shall exceed the overall probable proceeds concerning the same contract. These provisions are recognized by reducing the receivables for the part of the work already completed, and as provisions for the part of the work still in progress. The charges to be distributed comprise exclusively the costs related to the issue of the credit line spread on a straight-line basis over the life of the loan. 2.9. PROVISIONS FOR CONTINGENCIES AND EXPENSES Provisions for contingencies and expenses are recognized when, at the end of the year, the Company has an obligation towards a third party which shall probably or certainly result in an outflow of resources to this third party. The estimated amount recognized under provisions matches the probable resources that the Company will disburse to fulfill its obligation. The main provisions for contingencies and expenses that the Company must recognize include the estimated costs of disputes, litigation and legal claim proceedings by third parties or former employees, and provisions for vacant premises. NOTE 3 3.1. Notes relative to balance sheet items Gross value of non-current assets at the start of the year 12,486 12,486 996 138 2,545 3,679 19,833 10,373 30,206 46,371 1,098 2,121 342 995 1,337 4,445 564 1,265 4,238 22,039 26,277 54,086 1 267 232 28,391 28,623 28,891 987 1,023 NON-CURRENT ASSETS Gross value of non-current assets at the end of the year 361 39,655 40,016 2,454 138 4,206 6,798 24,181 5,016 29,197 76,011 (In €k) R&D expenses Other non-current intangible assets Advances and payments on account on non-current intangible assets TOTAL NON-CURRENT INTANGIBLE ASSETS Building improvements, miscellaneous improvements Transport equipment Office furniture and IT equipment TOTAL PROPERTY, PLANT AND EQUIPMENT Other non-current equity interests Loans and other non-current financial liabilities TOTAL NON-CURRENT FINANCIAL ASSETS TOTAL Contribution 361 626 Acquisitions 26,544 26,544 701 Sales 1 1 266 2011 Registration Document - AUSY 972012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=100http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1005 S S S S Company financial statements Notes to the financial statements “Other non-current intangible assets” mainly comprise: TECHNICAL LOSS technical unfavorable variances of Axylog and Aequalis following the complete transfer of all assets and liabilities in 2009 (€9,084k); a revised Aequalis technical unfavorable variances for €1,423k, reflecting the additional price paid to the transferors under the earnout clause agreed during the acquisition. The earn out related to the 2010 income and was the last variable element in this transaction; the acquisition of a business line of the EMI goodwill (€935k) completed in 2009 to AUSY’s benefit; technical unfavorable variances of APTUS, FINANCIÈRE APTUS, APTUS Orléans, APTUS Bordeaux and APTUS Sophia following the complete transfers of all assets and liabilities completed that year for €1,456.5k, €20,492.6k, €105.6k, €174.6k and €292.9k, respectively. Goodwill S The goodwill acquisition value, €2,450k, of a business line of the goodwill of APX, completed to the benefit of AUSY DEV in 2011, subsequently merged with AUSY by the complete transfer of all assets and liabilities. Non-current financial assets are the non-current equity interests in subsidiaries held. The change in the “Other equity interests” item primarily arises from the €4M capital increase to the benefit of the AUSY Belgium subsidiary. This capital increase was decided as a result of the additional price paid directly by AUSY Belgium to the transferors of DATAFLOW, a company acquired in 2009. The “Loans and other non-current financial liabilities” line mainly records: S S S The unfavorable variances identified in the framework of the business combination of AEQUALIS, AXYLOG, EMI, APTUS and its subsidaries have not been depreciated or impaired. The technical unfavorable variances created on these complete transfers of all assets and liabilities are recognized in the table of assets in the “Acquisitions” column; the €3,691k guarantee fund set up as part of the Factoring contract; a subordinated loan to the subsidiary AUSY Servicios de Ingeneria amounting to €200k; deposits and securities totaling €1,126k (including €416k in 2011). 3.1.1. Amortization and depreciation Depreciation Amounts at the start of the year 1,849 1,849 207 98 2,023 2,328 4,177 786 1,258 1,994 Amortization (in €k) R&D expenses Other non-current intangible assets TOTAL NON-CURRENT INTANGIBLE ASSETS Building improvements, miscellaneous improvements Transport equipment Office furniture and IT equipment TOTAL PROPERTY, PLANT AND EQUIPMENT TOTAL Contribution 361 375 736 472 Increases 283 283 583 32 429 1,044 1,327 Decreases 8 8 87 4 105 196 204 Depreciation Amounts at the end of the year 361 2,499 2,860 1,175 126 3,133 4,434 7,294 In addition to amortizations, the Company’s balance sheet includes depreciation of non-current intangible assets in progress in the amount of €133.55k (APTUS contribution). At the start of the financial year, provisions on AUSY Belgium and AUSY Luxembourg securities, amounting to €3,552k and €777k, respectively, were written back in full over the year as a result of the detailed impairment test the basis of which is desribed in Note 2.5 of these Notes. 98 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=101http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=101Company financial statements Notes to the financial statements 5 12/31/2010 15,501 722 1,373 1,938 660 3.1.2. Related entities and other non-current equity investments Related entities and other non-current equity investments (in €k) Non-current equity interests in subsidiaries Accounts receivable – Trade Other receivables and prepaid expenses Accounts payable – Trade Other liabilities and deferred income 12/31/2011 24,174 1,004 9,746 1,537 1,219 Subsidiaries and holdings (in €k) Equity other Share than share Interest capital capital held (%) 11,500 480 25 4 5 10 35 824 468 -410 118 -129 -16 -183 Book Value of shares held Outstanding Amount of Loans and guarantees and Pre-tax advances endorsements revenue of given by the given by the previous Net Company Company financial year 797 40,623 5,201 8,769 526 135 8 234 271 2,513 99 Companies AUSY Belgium AUSY Luxembourg AUSY GmbH APTUS Servicios de Ingeniera SL APTUS Tunisia Aptnet AUSY UK Subsidiaries held at between 10 and 50% (in €k) Pentalog Technology ELAN AUSY OHG Gross Dividends Net income cashed by the (profit or loss Company of previous during the financial year) financial year 491 232 -287 -142 -16 -2 -182 99.9% 21,918 21,918 80% 100% 100% 100% 100% 100% 1,824 25 297 11 10 35 1,824 25 297 11 10 35 36 20 1,291 -1 50% 50% 22 10 22 10 6,514 362 0 N.B.: S S information relating to subsidiaries outside the euro zone (Tunisia and Romania) has been converted to euro; the shareholder equity of AUSY Servicios de Ingeneria SL includes the AUSY subordinated loan for €200k. 2011 Registration Document - AUSY 992012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=102http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1025 3.2. (In €k) Income taxes Company financial statements Notes to the financial statements DUE DATES – RECEIVABLES Gross amount 200 4,817 1,028 72,059 459 373 3,163 2,207 11,396 7,413 1,466 104,581 Due in one year max 3,691 1,028 72,059 459 373 3,163 2,207 11,396 7,413 1,466 103,255 Over one year 200 1,126 Loans and advances given Other non-current financial assets Doubtful or disputed receivables – Trade Other receivables – Trade Personnel receivables Social security and other social organizations Value added tax Group and associates Miscellaneous receivables including factor Prepaid expenses TOTAL 1,326 3.3. (In €k) INCOME RECEIVABLE 12/31/2011 35,526 44 109 136 35,815 12/31/2010 12,662 76 95 34 4 12,871 Accounts receivable – Trade Personnel Social organizations Miscellaneous, income receivable Other receivables TOTAL 3.4. (In €k) MARKETABLE SECURITIES 12/31/2011 83 83 12/31/2010 119 2,565 2,684 Treasury share value on balance sheet – Liquidity agreement Marketable security value on balance sheet TOTAL Marketable securities are valued at their acquisition cost. Sales of marketable securities generated income of €55k in 2011. In addition, during the first half of the year, the Company transferred most of the treasury shares previously held, resulting in a favorable variance of €957k for the transaction. This favorable variance is recorded in extraordinary income. 3.5. (In €k) CASH AND CASH EQUIVALENTS 12/31/2011 32,520 2,757 35,277 12/31/2010 9,000 17,762 2,472 29,234 Time deposit account Factor Bank and petty cash TOTAL AUSY uses factoring. The accounts receivable sold to the Factor were worth €37,335k. As of December 31st 2011 there was no current drawing (factor commitment). 100 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=103http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=103Company financial statements Notes to the financial statements 5 12/31/2010 1,096 1,096 3.6. (In €k) DEFERRED EXPENSES 12/31/2011 1,096 1,096 OBSAAR Issue Premium TOTAL The redemption premium of the bond issue (OBSAAR) subscribed in September 2009 is depreciated according to the OBSAAR repayment schedule in 2012-2013-2014. 3.7. CHANGES IN SHAREHOLDER EQUITY The Company’s share capital, made up of 4,495,007 shares of €1 par value, has only one category of share: common shares. (In €k) Shareholder equity at opening Conversion public equity warrants (BSAs) BSAAR conversion Increase of capital OCEANE conversion Income for the period SHAREHOLDER EQUITY AT CLOSING 12/31/2011 37,940 524 9 14,481 18,483 71,437 12/31/2010 29,910 4 1,172 6,854 37,940 At the Extraordinary General Meeting held on January 10th, 2012, AUSY’s shareholders voted to extend the exercise period of the stock warrants issued by the Board of Directors’ Meeting of August 28th 2007, extending the final exercise date from October 15th 2012 to October 15th 2015. The shareholders also voted to amend the parity for the exercise of these stock warrants, increasing the number of warrants for one AUSY common share from 22 to 28. The price remained unchanged at €18. This new potential dilution now stands at 173,692 shares compared with 224,157 shares before. The Board of Directors of October 20th 2011 allocated 128,500 share subscription options. The Board of Directors of November 25th 2011 established a free share allocation plan, which comprised 10,000 shares. 3.8. (In €k) PROVISIONS AND DEPRECIATIONS POSTED TO THE BALANCE SHEET Amount at the start of the year 1,609 400 2,009 4,329 13 593 4,935 6,944 S Contribution Increases Decreases - Amount at the end of the year 915 1,748 2,663 13 589 602 3,265 Depreciation allowances TOTAL REGULATED PROVISIONS Litigation provisions Other provisions for contingencies and expenses TOTAL PROVISIONS FOR CONTINGENCIES AND EXPENSES Non-current equity interests provisions Other financial non-current asset provisions Provisions on accounts receivable TOTAL DEPRECIATION PROVISIONS TOTAL 527 552 552 1,114 1,641 1,221 318 1,539 4,329 242 242 794 219 219 1,860 465 4,794 6,333 The provisions posted to the balance sheet as of December 31st 2011 mainly concern: S S S employee-related litigation for a total of €915k, corresponding to current or future employment court risks; a €400k provision for risks relating to a commercial dispute; provisions for loss on termination of projects under way amounting to €204k; a provision of €1,030k covering the remaining lease commitments to the end of the lease for unoccupied premises, as a result of the merger of the APTUS group; a provision for accounts receivable risks amounting to €589k; a €13k deposit and guarantee provision. S S The provision recognized non-current equity interests in the Belgian and Luxembourg subsidiaries for an amount of €4,329k was written-back in full this year, as described in Note 3.1.1. 2011 Registration Document - AUSY 1012012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=104http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1045 3.9. (In €k) Bond issues Miscellaneous Company financial statements Notes to the financial statements BORROWINGS AND FINANCIAL LIABILITIES Due under one year 6,947 4,029 131 294 19 11,420 33,656 Due over one year 13,893 19,485 278 12/31/2011 20,840 23,514 409 294 19 45,076 12/31/2010 20,840 17 20,857 Financial balance sheet IG adjustment Loans from financial institutions Other borrowings and associated debts Interest on loans BORROWINGS AND FINANCIAL LIABILITIES In October 2009, the Company issued bonds with redeemable equity warrant (OBSAARs) with October 2012, October 2013 and October 2014 maturity dates, by thirds. As they are floating rate notes, an interest rate swap was carried out to hedge the rate at 2.312%. The Company arranged a floating-rate syndicated credit line in April 2011. It drew down several tranches for a total of €23,395k. As these are floating rates, swaps were arranged at each drawdown to hedge the rates at: S S S 4.54% for €8,000k with an effective interest rate of 4.91%; 4.55% for €8,000k with an effective interest rate of 4.92%; 3.60% for €5,395k with an effective interest rate of 4.07%. The AUSY goodwill was pledged as security for the syndicated loan. 3.10. DUE DATE – PAYABLES (In €k) Other bond issues Borrowings and financial liabilities originally due under one year Miscellaneous borrowings and financial liabilities Accounts payable – Trade Personnel receivables Social security and other social organizations Income taxes Value added tax Other taxes and duties Group and associates Liability on non-current assets Other liabilities Deferred income TOTAL Gross Amount Due in one year max 20,929 23,704 444 13,580 15,825 19,527 21,374 1,382 1 4,700 4,385 4,509 130,360 7,036 4,219 166 13,580 15,825 19,527 21,374 1,382 1 1,700 3,583 4,509 92,902 Due over one year and under five years 13,893 19,485 278 Over five years 3,000 675 127 37,331 127 102 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=105http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=105Company financial statements Notes to the financial statements 5 12/31/2010 2,024 16,055 7 2,232 20,318 3.11. (In €k) LIABILITIES 12/31/2011 89 171 34 5,185 23,964 18 3,112 32,573 Interest on bond issues Interest on bank borrowings Interest on ex APTUS equity interest Accounts payable – Trade Tax and social security liabilities Payable cash and bank expenses Other liabilities TOTAL 3.12. DEFERRED INCOME AND PREPAID EXPENSES (In €k) Prepaid expenses Deferred income TOTAL 12/31/2011 -1,466 4,509 3,043 12/31/2010 -656 2,040 1,384 Prepaid expenses concern the adjustments resulting from suppliers’ cut-off and mainly include expenses related to the purchase of goods and services to be supplied at a later date. Deferred income relates to the adjustments resulting from the revenue cut-off and mainly includes maintenance billed in advance and the difference between the status of work-in-progress and billing. NOTE 4 4.1. Notes to the income statement Transfer of expenses Worth €971k and related to reimbursements of payroll expenses received from various organizations: APICIL and MERCER (retirement compensation), FAFIEC, AGEFOS and FONGECIF (collective organizations – professional training) and expenses re-invoiced to AUSY GmbH. REVENUE The services provided in France represent 99.4% of the total revenue. Income is recorded as and when the service is performed (work-inprogress method for committed-results projects). 4.2. OTHER OPERATING INCOME Contingency and Expense Provision write-backs These amount to €2,006k for write-backs of provisions for risk on accounts receivables, losses on termination of committed-results contracts and labor disputes no longer current as of December 31st 2011. 2011 Registration Document - AUSY 1032012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=106http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1065 4.3. (In €k) Company financial statements Notes to the financial statements FINANCIAL RESULT Total financial expenses 489 51 2 408 2 1,449 364 3,541 4,329 55 2,401 8,289 Total financial income Interest from borrowings Factor accounts interest Interest on holdings' blocked accounts Bond coupons Discounts granted Other financial expenses Current account interest received Other financial income Write-back of provisions on financial items Income from marketable securities TOTAL Other financial income mainly includes a write-back of the provision for depreciation of the securities of the Belgian and Luxembourg subsidiaries, for €4,329k, and the merger favorable variances of €3,444k recorded when the following companies merged: (In €k) ELAN favorable variance Exalen favorable variance APTUS Bordeaux merger surplus APTUS Orléans merger surplus APTUS Sophia merger surplus FINANCIÈRE APTUS merger surplus TOTAL Amount 501 2,889 3 26 2 23 3,444 For Exalen and the APTUS group subsidiaries, these favorable variances represent the result for the period between the start of the financial year and the date of the complete transfer of all assets and liabilities. (In €k) AUSY DEV loss on merger AUSY PART loss on merger APTUS SA loss on merger TOTAL UNFAVORABLE VARIANCE Amount 260 228 625 1,113 4.4. EXTRAORDINARY INCOME A net expense of €350k is recorded in extraordinary income. This mainly consists of the gain of €957k recorded from the sale of treasury shares, and the increase in the provision for lease commitments for unoccupied premises, for -€1,030k. 104 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=107http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=107Company financial statements Notes to the financial statements 5 Amount 334 1,131 -4,235 -4,392 -18 -7,180 4.5. INCOME TAX At December 31st 2011, the tax expense consists of the tax liability for AUSY and the companies merged during the financial year, since these complete transfers of assets and liabilities were effective retroactively to January 1st for tax purposes. (In €k) Taxes on the capital increase Taxes recognized for FY 2011 2008 Research Tax Credit 2009 Research Tax Credit 2010 Apprenticeship Tax Credit TOTAL There is no tax expense for non-recurring items (tax income). 4.6. INCREASES AND DECREASES IN FUTURE TAX EXPENSES Amount 354 2,806 204 1,030 668 5,062 1,687 Decreases of future tax liability (In €k) Adjustments on collective investments in transferable securities Organic Tax Employee profit-sharing Provision for loss on termination Provision for APTUS premises Tax loss carry-forwards acquired and not used in the period TOTAL DECREASES Tax effect (33.33%) 4.7. EMPLOYEES 4.9. INDIVIDUAL TRAINING RIGHTS As of December 31st 2011, the total headcount stands at 2,843, consisting of 2,636 executives and 207 employees, compared with a total of 1,891 at end-2010. The average headcount rose to 2,399, consisting of 2,218 executives and 181 employees – vs. 1,837 in 2010. The aggregate volume of training hours for Individual Training Rights as of December 31st 2011 was 138,997 hours. In 2011, 2,448.5 hours were used under Individual Training Rights. 4.8. CORPORATE OFFICERS’ COMPENSATION The compensation allocated in 2011 to Corporate Officers and Executive Management was €1,057k. Directors’ fees paid in 2011 totaled €52k. 2011 Registration Document - AUSY 1052012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=108http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1085 5.1. 5.2. (In €k) Company financial statements Notes to the financial statements NOTE 5 Off-balance sheet commitments compensation that the Company will pay out to its employees upon their retirement, in relation to the seniority earned on the closing date. The book value is determined by taking into account the earned seniority and the likelihood of presence in the Company upon retirement, as well as the estimated future salary. The rates used are as follows: increase in salaries 1.64%, discount rate 4.60%, and an inflation rate of 2.47%. This amount includes a social liabilities rate of 50%. COMMITMENTS ON PENSIONS, RETIREMENT BENEFITS AND COMPENSATION The Company’s commitments regarding retirement compensation are not booked as a provision. They total €793k on the closing date. This amount is calculated on the basis of the current value of probable COMMITMENTS ON RECEIVED OR GIVEN GUARANTEES 12/31/2011 330 330 16 14,970 14,986 12/31/2010 124 124 16 12,816 12,832 Rental agreements (premises) Commitments received Guarantees and endorsements (real estate guarantees) Rental agreements (premises and automobiles) Commitments given In addition, the Company has received other commitments in the form of liability guarantees as part of its acquisitions. In essence, these guarantees cover the tax and social risks prior to the acquisition. 106 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=109http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=109Company financial statements Key figures for the last five years 5 FY 2011 4,495,007 4,495,007 1,123,361 199,500,420 10,354,651 -7,180,546 2,598,970 18,483,701 - 5.4. KEY FIGURES FOR THE LAST FIVE YEARS Item (In €) I - Capital at end of year Share capital Number of existing common shares Through conversion of bonds By exercise of pre-emption rights II – 2011 transactions and income Revenue excluding taxes Income before taxes, employee profit-sharing and depreciations and provisions expenses Income taxes Employee profit-sharing payable for 2010 Income after taxes, employee profit-sharing and depreciations and provisions expenses Distributed income III - Income per share Income after taxes, employee profit-sharing but before depreciations and provisions expenses Income after taxes, employee profit-sharing and depreciations and provisions expenses Dividend allocated to each share IV - Staff Average number of employees during 2011 2011 payroll 2011 welfare benefits (social security, charitable works, etc.) 10 945,044 423,158 1,340 38,982,260 17,215,879 1,642 63,566,698 28,535,478 1,837 70,249,696 31,378,571 2,399 93,059,991 42,519,531 -0.22 -0.27 2.91 2.37 1.23 0.96 1.55 1.87 3.32 4.11 1,540,500 -525,462 208,127 -881,545 81,299,409 13,520,283 2,259,028 1,039,002 8,323,243 135,348,683 6,451,670 1,530,392 528,230 3,413,593 157,651,578 11,314,777 3,893,334 1,728,860 6,853,623 3,325,913 3,325,913 354,862 798,792 3,508,019 3,508,019 183,122 775,714 3,562,412 3,562,412 129,299 1,128,257 3,667,613 3,667,613 1,127,617 FY 2007 FY 2008 FY 2009 FY 2010 2011 Registration Document - AUSY 1072012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=110http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1105 Ausy SA S S S Company financial statements Statutory Auditors’ Report on the Annual Financial Statements 5.5. STATUTORY AUDITORS’ REPORT ON THE ANNUAL FINANCIAL STATEMENTS Year ending December 31 2011 To the Shareholders, In compliance with the assignment entrusted to us by your General Meeting, we hereby report to you, for the year ended December 31 2011, on: the audit of the attached annual financial statements of Ausy SA; the justification of our assessments; the specific verifications and information required by law. These financial statements have been approved by the Board of Directors. Our role is to express an opinion on these financial statements based on our audit. 1. OPINION ON THE ANNUAL FINANCIAL STATEMENTS We conducted our audit in accordance with the professional standards applicable in France. Those standards require that we plan and perform the audit to obtain reasonable assurance on whether the financial statements are free of material misstatement. An audit involves verifying, by using sampling techniques or other methods of selection, the amounts and disclosures in the financial statements. An audit also includes evaluating the appropriateness of accounting policies used and of accounting estimates made, as well as the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. In our opinion, the financial statements give a true and fair view of the Company’s operating results for the financial year just ended, as well as of its financial position and net assets, in accordance with French accounting principles. 2. JUSTIFICATION OF OUR ASSESMENTS In accordance with the provisions of Article L. 823-9 of the French Commercial Code relating to the justification of our assessments, we draw the following matter to your attention: S Notes “2.2 - Intangible Fixed Assets – Losses on Merger”, and “2.4 - Financial Fixed Assets – Investment Securities” to the financial statements set out the rules and accounting policies for assessing losses on merger and investment securities. Our due diligence consisted in (i) assessing the merits of the accounting rules and policies selected, and (ii) the data and assumptions selected, as well as the resulting valuations. We also verified that the information provided in the notes to the financial statements was appropriate. These assessments were made as part of our audit of the yearly financial statements taken as a whole, and therefore contributed to the opinion we formed, which is expressed in the first part of this report. 3. SPECIFIC VERIFICATIONS AND INFORMATION In accordance with professional standards applicable in France, we have also performed the specific verifications required by French Law. We have no observation to make as to the fair presentation and consistency with the financial statements of the information given in the Management Report of the Board of Directors, and in the documents addressed to the shareholders with respect to the financial position and the annual financial statements. Pursuant to the provisions of Article L. 225-102-1 of the French Commercial Code regarding the compensation and benefits received by corporate officers, and any other commitments made in their favor, we have verified the consistency of the information provided with the financial statements, and with the data used to prepare these financial statements and, where applicable, with the information gathered by your Company from companies controlling it or controlled by it. Based on this work, we attest to the accuracy and fair presentation of this information. In accordance with French Law, we have verified that the required information concerning the purchase of investments and controlling interests and the identity of shareholders and holders of voting rights has been properly disclosed in the Management Report. Paris La Défense, April 24 2012 KPMG Audit IS Paris, April 24 2012 Grant Thornton Frenc2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=111http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1116 Information on the Company and the share capital 6.1. INFORMATION ON THE COMPANY 110 110 113 6.1.1. Company presentation 6.1.2. Parent company and subsidiaries 6.2. INFORMATION ON THE SHARE CAPITAL 6.2.1. 6.2.2. 6.2.3. 6.2.4. 6.2.5. Share capital Non-issued authorized capital Potential share capital Share buyback program Changes in equity 114 114 114 115 117 119 6.3. SHAREHOLDERS 120 6.3.1. Breakdown of capital and voting rights 120 6.3.2. Breakdown of capital for the last three financial years 121 6.3.3. Breakdown of capital, voting rights and other dilutive equity instruments 121 6.3.4. Crossing legal threshold limits of ownership 122 6.3.5. Group and subsidiaries pledge of shares 122 6.3.6. Elements likely to have an impact in case of public offering 122 6.3.7. Shareholders’ agreements 123 6.3.8. Employee profit-sharing plans 124 6.4. INVESTOR INFORMATION 125 2011 Registration Document - AUSY 1092012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=112http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1126 AUSY Information on the Company and the share capital Information on the Company 6.1. INFORMATION ON THE COMPANY 6.1.1. Company presentation COMPANY NAME Acquiring direct or indirect interests in new or existing companies, as well as providing management, administrative, legal, accounting, financial, commercial and technical advice within or to companies whose purpose is related to the above-mentioned activities. And more generally, all types of industrial, commercial, financial, security or real estate transactions directly or indirectly related to the activities set out above or which further the accomplishment thereof.” NUMBER AND PLACE OF REGISTRATION OF THE ISSUER AUSY is entered on the Nanterre Trade and Companies Registry (RCS) under no. 352 905 707. Its APE Code, which identifies the type of activity carried out by the Company, is 6202A. STATUTORY PROFIT ALLOCATION Pursuant to article 47 of the Articles of incorporation: “The difference between the financial year’s incomes and expenses, after deduction of depreciations and provisions, constitutes the financial year’s profit or loss. Five percent of the profit, reduced by prior losses (if relevant), is retained to constitute the statutory reserve. This retention ceases to be mandatory when the statutory reserve reaches a tenth of the share capital. It picks back up when, for any reason, the statutory reserve has slipped below this tenth. The distributable profit consists of the financial year’s profit reduced by both prior losses and the above retention and increased by profit balances brought forward. This profit is at the General Meeting’s disposal. It may, at the Board of Directors’ suggestion, partly or wholly carry it forward, allocate it to general or special reserve funds, or distribute it to shareholders as dividends. Moreover, the Meeting may decide to distribute amounts levied from the reserves that it has at its disposal. In this case, the decision specifies which reserve lines are levied. However, the dividend is levied first and foremost on the financial year’s distributable profit. The revaluation gain is not distributable; it may be added partly or wholly to the equity capital. The Meeting may give each shareholder for part or whole of the dividend or advance on distributed dividend the option of payment in cash or in shares.” DATE OF INCORPORATION AND TERM AUSY was incorporated on December 18th 1989 and registered on December 28th 1989 for a term of 99 years expiring on December 28th 2088. REGISTERED OFFICE 88, boulevard Galliéni 92445 Issy-les-Moulineaux Cedex - France Telephone: +33 (0)1 41 08 65 65 LEGAL FORM AND APPLICABLE LEGISLATION AUSY is a french société anonyme (public limited company) governed by a Conseil d’administration (Board of Directors) and subject to the applicable provisions of Book II of the French Commercial Code and its own Articles of incorporation. FINANCIAL YEAR From January 1st to December 31st each year. PURPOSE In accordance with article 3 of the Articles of incorporation: “The Company’s purpose in France and abroad covers: All service and engineering activities related to IT and electronics; Consulting, organization, assistance, training, design, implementation, integration and installation of products or systems related to data processing and transmission; All sales, distribution, leasing, equipment and software operation and/ or maintenance activities; LOCATION WHERE DOCUMENTS AND INFORMATION RELATING TO THE COMPANY MAY BE CONSULTED Articles of incorporation, financial statements and reports, and minutes of General Meetings may be consulted at the Company’s registered office. 110 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=113http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=113Information on the Company and the share capital Information on the Company 6 GENERAL MEETINGS Shareholder notification and Meeting place: article 30 of the Articles of incorporation “General Shareholder Meetings are called by the Board of Directors. Absent which, they may be called by persons designated par the French Commercial Code, namely the Statutory Auditors or a proxy designated by the commercial court’s president ruling in summary judgment at the request of shareholders representing at least 5% of the share capital or, in the case of a special Meeting, a tenth of the relevant category shares. Shareholder Meetings are held at the registered office or at any other place stipulated in the notice.” Meetings) ceases to appear in the Company’s share register, subject to any exceptions provided for in law. The votes are taken either by show of hands or by roll call. Secret balloting, the conditions of which shall be set by the Meeting, may only take place at the request of members representing, as themselves or as proxies, the required majority for the concerned resolution. The Company cannot validly vote using Treasury shares. Also stripped of voting rights: non-fully paid-up shares, shares of potential subscribers at Meetings called to vote on disapplying pre-emption rights, the concerned-party’s shares in the procedure stipulated by article 26, and all shares above the fraction that should have been disclosed, in accordance with article 14.” Conditions for General Meeting admission: article 33 of the Articles of incorporation “The right to participate in the General Meetings is subject to registration of shares in the accounts in the name of the shareholder or in that of an intermediary registered in his/her/its name no later than the third business day prior to the Meeting in question at 00:00 hours Paris time, either in the register of registered shares held by the Company or in the register of bearer shares held by the authorized intermediary (…). Are deemed in attendance to reach the quorum and the majority, the shareholders who participate in the Meeting via video-conference or by any telecommunication means permitting their identification and in accordance with current regulations, when the Board of Directors decides the use of such participation means, prior to the General Meetings being called.” GOVERNING BODY (BOARD OF DIRECTORS) On the Board of Directors’ composition: article 17 of the Articles of incorporation “The Company is managed by a Board of Directors of at least three members and no more than eighteen; however, in the event of a merger, this number of eighteen persons may be increased subject to the provisions of the French Commercial Code. Directors are appointed by the Ordinary General Meeting that may dismiss them at any time. In the event of a merger or demerger, their appointment may be decided by an Extraordinary General Meeting. The Legal Entities appointed as Directors must name a permanent representative subject to the same conditions and obligations as if he/ she were a Director on his own behalf. A Company employee may be appointed to the Board only if his/her employment contract predates his/her appointment and tallies with a real employment. The number of Directors bound to the Company by an employment contract may not exceed one third of the Directors in place.” Conditions for the exercise of voting rights and double voting rights: article 36 of the Articles of incorporation At the General Meeting of January 10th 2012, the shareholders resolved to modify article 36 of the Articles of incorporation relating to voting rights, by clarifying double voting arrangements where share ownership is split, and modifying the first three paragraphs of article 36 accordingly, which now reads as follows: “Each Meeting member is entitled to as many votes as shares he or she possesses or represents without limitation, subject to the provisions of french law and the Articles of incorporation which may restrain t2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=114http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1146 Information on the Company and the share capital Information on the Company The Board of Directors carries out all controls and verifications that it deems necessary. The Chairman or the Company’s Chief Executive Officer must communicate to each Director all documentation and information necessary to or which further the accomplishment of his/ her mission. Chief Executive Officer, the Board of Directors determines the width and breadth of the powers deputized to the Deputy Chief Executive Officers. Deputy Chief Executive Officers have the same powers in regards to third parties as the Chief Executive Officer. The Board sets the amount and terms of the compensation for the Chief Executive Officer and Deputy Chief Executive Officers.” EXECUTIVE MANAGEMENT In accordance with article 23 of the Articles of incorporation, “Executive Management is carried out by either the Chairman of the Board of Directors, or another person, be he/she a Board member or not, with the title of Chief Executive Officer, engaging his responsibility. The Board of Directors deliberating under the conditions defined by article 21 chooses between either Executive Management officiating methods. It may at any time amend its choice. In each case, it must inform the shareholders and third parties in accordance with current regulations. Should the Chairman also be the Chief Executive Officer, the present Articles of incorporation terms relating to the latter are applicable. When Executive Management is not taken on by the Chairman of the Board of Directors, the Board of Directors names a Chief Executive Officer to whom the Chairman age limits apply. The Chief Executive Officer may be dismissed at any time by the Board of Directors. If the dismissal is not on justified grounds, it may result in the payment of damages, unless he is also the Chairman of the Board of Directors. The Chief Executive Officer is vested with the most wide-spanning powers to act in all circumstances in the Company’s name. He exercises these powers within the limits set out in the corporate purpose and in accordance with the powers expressly assigned by law to shareholder Meetings as well as the Board of Directors. He commits the Company even by his acts which are not part of the corporate purpose, unless the Company proves the third party was aware the act overstepped this purpose or could not ignore it in light of the circumstances. He represents the Company in his exchanges with third parties to whom all decisions limiting his powers are unenforceable. He may be authorized by the Board of Directors to agree to sureties, endorsements and guarantees given by the Company under the terms and limits set by current regulations. The Board of Directors may appoint up to five Deputy Chief Executive Officers, on the proposal of the Chief Executive Officer. The age limit set for the Chairman also applies to Deputy Chief Executive Officers. The Deputy Chief Executive Officers may be selected from among the Board members or from without. They may be dismissed at any time by the Board at the Chief Executive Officer’s behest. If the dismissal is not on justified grounds, it may result in the payment of damages. Should the Chief Executive Officer cease or be otherwise incapacitated from carrying out his duties, the Deputy Chief Executive Officers keep, unless otherwise decided by the Board, their positions and duties till the appointment of the new Chief Executive Officer. In agreement with the SHARES Pursuant to article 11 of the Articles of incorporation, “The shares are held in registered or bearer form at the choice of their holder. They may be held in bearer form only after their full payment. The Company is authorized to request at any given time that the security clearing house reveal the name, nationality and address of holders of securities that grant their owners, immediately or eventually, voting rights at Shareholder Meetings. Furthermore the Company is entitled to request, under the terms set by the French Comm2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=115http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=115Information on the Company and the share capital Information on the Company 6 100% 100% 100% 50% 51% 50% 100% 100% 100% 100% 100% 6.1.2. Parent company and subsidiaries As of December 31st 2011, AUSY, the parent company of the AUSY Group, directly or indirectly controlled (pursuant to article L. 233-3 of the French Commercial Code): List of the Group’s subsidiaries as of 12/31/2011 Company name FRANCE APTNET EUROPE AUSY Belgium AUSY Luxembourg Pentalog Technology ELAN AUSY GmbH ELAN AUSY OHG AUSY GmbH AUSY UK AUSY Servicios de Ingenieria SL AUSY Tunisia AUSY Technologies India Belgium (Brussels) Luxembourg (Luxembourg) Romania (Brasov) Germany (Hamburg) Germany (Hamburg) Germany (Munich) UK (London) Spain (Barcelona) Tunisia (Tunis) India (Bangalore) France (Versailles) Country AUSY’s ownership Interest All these companies have complementary and/or connected activities. AUSY’s Executive Management develops the Group’s overall policy, and decides economic, social and financial aims in the general interest. AUSY plays both a commercial and a holding role, thus offering a comprehensive service range to the Group’s discrete structures. AUSY SA supplies operational financing or financing relating to specific transactions (e.g. external growth, bonds) and may make cash flow advances to its subsidiaries in case of specific needs. The subsidiaries mainly have operational relations among themselves and, in isolated cases, current account advances. Consequently, the Group has put in place an intra-Group financial agreement (October 2008) and a centralized cash management agreement (August 2010). Thus, with regard to the legal provisions applicable to each AUSY Group subsidiary, the financial relationships between the Group’s subsidiaries and the parent company AUSY are governed by one or other of these agreements. 2011 Registration Document - AUSY 1132012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=116http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1166 Information on the Company and the share capital Information on the share capital 6.2. INFORMATION ON THE SHARE CAPITAL 6.2.1. Share capital As of December 31st 2011, the share capital stood at €4,495,007 split into 4,495,007 common shares (ISIN Code FR0000072621), each with a par value of €1. As of March 31st, 2012, the share capital stood at €4,495,078, split into €4,495,078 common shares, each with a par value of €1. 6.2.2. Non-issued authorized capital The table below shows the delegations of power and authorizations granted by the March 31st 2012 General Meeting to the Board of Directors: Nature of the delegation of power or authorization granted to the Board Increase the capital by capitalizing income, retained earnings or additional paid-in capital (art. L. 225-129-2 and L. 225-130 of the French Commercial Code) Increase the capital by issuing, with pre-emption rights, common shares and/or securities convertible to equity or debt securities (art. L. 225-129-2 of the French Commercial Code) Increase the capital in order to remunerate the contributions in kind of shares or equity securities (art. L. 225-147 of the French Commercial Code) Issue equity warrants (BSA and/or BSAANE and/or BSAAR) reserved to a certain category of persons (art. L. 225-129-2, L. 225-138 and L. 228-91 of the French Commercial Code) Increase the capital by issuing shares reserved to members of the employee savings scheme (art. L. 225-129-6 and L. 225-138-1 of the French Commercial Code and L. 3332-18 of the French Labor Code) Grant share subscription and/or acquisition options to employees and/or certain Corporate Officers (art. L. 225-177 and L. 225-185 of the French Commercial Code) Award shares for no consideration to employees and/or Corporate Officers (art. L. 225-197-1 and L. 225-197-2 of the French Commercial Code) Increase of capital, without pre-emption rights, through issue of common shares or convertible securities through public offering (art. L. 225-136 of the French Commercial Code) Date of GM Term and/or expiration date Limit Amount used Amount available GM of 06/14/2011 7th resolution 26 months or until 08/13/2013 €3,000,000 - €3,000,000 €3,000,000 and €25,000,000 for debt securities GM of 06/14/2011 8th resolution GM of 06/14/2011 10th resolution 26 months €3,000,000 and or until €25,000,000 for 08/13/2013 debt securities 26 months 10% of capital as of or until 08/13/2013 06/14/2011 GM - 10% of capital as of 06/14/2011 GM - GM of 06/14/2011 11th resolution 18 months or until 12/13/2012 €3,000,000 - €3,000,000 GM of 06/14/2011 12th resolution GM of 06/14/2011 13th resolution GM of 06/14/2011 14th resolution 26 months or until 08/13/2013 38 months or until 08/13/2014 38 months or until 08/13/2014 26 months or until 08/16/2012 0.5% of capital as of day of Board decision 10% of existing capital as of day of first grant 10% of existing capital as of day of first grant €3,000,000 (€25,000,000 for debt securities) 0.5% of capital as of day of - Board decision 128,500 shares 318,092 shares 10,000 shares 439,451 shares €3,000,000 (€25,000,000 for debt securities) €3,000,000 and 20% of the capital/ year (€25,000,000 for debt securities) GM 06/17/2010 13th resolution - Increase of capital, without pre-emption rights, through issue of common shares or convertible securities through private placement (art. L. 225-136 of the French Commercial Code) GM 06/17/2010 14th resolution €3,000,000 and 20% of the capital/year (€25,000,000 26 months for debt or until securities) 08/16/2012 - 114 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=117http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=117Information on the Company and the share capital Information on the share capital 6 1 6.2.3. Potential share capital FREE SHARE AWARD SCHEME (PERFORMANCE SHARES) In 2011, the Company put in place a performance share plan (the “November 2011 Performance Share Scheme”), with the following conditions: GM 06/14/11 14th resolution BM Vesting period Retention period No. of shares granted No. of beneficiaries on day of grant 11/25/2011 Two years Two years 10,000 Please note that free shares are new shares only. STOCK OPTIONS In 2011, stock options were granted under the “2011 Options” plan, with the following conditions: Term of plan GM BM Exercise date Sale date Four years or until 10/19/2019 (inclusive) Total no. of options Subscription price No. of beneficiaries on day of grant 06/14/2011 13th resolution 10/20/2011 Four years from 10/20/2012 128,500 €19.92 30 EQUITY WARRANTS On March 31st, 2012, with respect to a share capital of ( ), dilutive instruments were as follows: Dilutive instruments 2007 BSA (ISIN Code FR0010505941) 2009 BSAAR ISIN Code FR0010805366) TOTAL No. of instruments Max. no. of shares that may be issued Max. potential dilution (in% of capital) 4,862,342 876,900 5,739,242 173,655 889,177 1,062,832 3.86% 19.78% 23.64% 2011 Registration Document - AUSY 1152012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=118http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1186 Decision Information on the Company and the share capital Information on the share capital In 2007, equity warrants (BSA) were granted, with the following conditions: Features Public BSA - initial features • Issue of 3,324,961 BSAs giving rights to 369,440 shares • Potential increase of capital of €369,440 • Unit subscription price = free • Parity: 9 BSA = 1 share • Share exercise price: €16.09 • Exercise period: 09/10/2007 to 06/30/2010 • Traded on Euronext Paris since 09/10/2007 Managers’ BSA - initial features • Issue of 2,200,000 BSAs giving rights to 244,444 shares • Potential increase of capital of €244,444 • Unit subscription price: €0.127 • Parity: 9 BSA = 1 share • Share exercise price: €16.09 • Cannot be sold until 02/28/2009 • Exercise period: 03/01/2009 to 06/30/2010 • Traded on the same line as the public BSA since 03/01/2009 GM of 06/07/2007 and 08/27/2007 BM of 08/28/2007 GM of shareholders 11/09/2009 GM of BSA holders 11/09/2009 Public BSA and Managers’ BSA - changes in features • BSA outstanding as of 11/11/2009: 5,508,896 • Date modifications take effect: 11/11/2009 • Unit subscription price: €18 • Parity: 22 BSA = 1 share • Expiration date: 10/15/2012 • Exercise period from 11/11/2009 to 10/15/2012 inclusive Adjustment of conversion bases as of 04/01/2011 (following rights issue) • Date modifications take effect: 04/01/2011 • Parity: 22 BSA = 1.014 shares No other changes Public BSA and Managers’ BSA - changes in features • Date modifications take effect: 01/12/2012 • Unit subscription price: €18 • Parity: 28 BSA = 1 share • Expiration date: 10/15/2015 • Extension of exercise period until 10/15/2015 inclusive Chairman’s decisions on 04/01/2011 Shareholders’ GM and GM of BSA holders of 01/10/2012 In 2009, bonds with equity warrants and/or bonds with redeemable equity warrants (OBSAARs) were issued with the following conditions, it being specified that since October 20th 2011, BSAARs can be sold on EURONEXT Paris: Decision Features NOTES • 219,370 notes • Par value: €95 • Issue and dividend qualification date: 10/20/2009 • Loan term: five years • Repayment terms: at par according to the following schedule: • 10/20/2012 (3rd anniversary): 1/3 • 10/20/2013 (4th anniversary): 1/3 • 10/20/2014 (5th anniversary): 1/3 • Trading date: 10/20/2009 on EURONEXT Paris BSAAR • 877,480 BSAARs • Exercise price: €17 • Parity: 1 BSAAR = 1 share • Duration: seven years • Non-transferable period from 10/21/2009 to 10/20/2011 exclusive • Exercise period from 10/20/2011 to 10/20/2016 inclusive • Early redemption at the Company’s initiative at any time, from 10/20/2012 till 10/20/2016 inclusive, if the average opening AUSY share price multiplied by each date’s exercise ratio exceeds €25.50, or approx. 150% of the BSAAR exercise price • Trading date: 10/20/2011 on EURONEXT Paris • Lapsing: 10/21/2016 Adjustment to conversion ratios from 04/01/2011 following rights issue • Date modifications take effect: 04/01/2011 • Parity: 1 BSAAR = 1.014 shares No other changes GM of 06/15/2009 OBSAAR BM of 09/16/2009 and 09/22/2009 • Issue of Chairman’s decisions on 219,370 OBSAARs with 09/24/2009 pre-emption rights • Issue price: €95 • Parity: 1 OBSAAR gives rights to 4 BSAAR • Face value of loan: €20,840,150 • Subscription period from 09/28/2009 to 10/09/2009 inclusive Chairman’s decision on 04/01/2011 There are no other convertible securities than those itemized above. 116 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=119http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=119Information on the Company and the share capital Information on the share capital 6 6.2.4. Share buyback program AUTHORIZATION GRANTED BY THE GENERAL MEETING TO THE BOARD OF DIRECTORS TO CARRY OUT A SHARE BUYBACK PROGRAM The Sixth resolution of the General Meeting of June 14th 2011, having taken note of the Board of Directors’ report, empowered the latter, for a period of 18 months, pursuant to articles L. 225-209 et seq. of the French Commercial Code, to buy back, over one or more instances and at the times of its choosing, Company shares within the limit of 10% of the number of shares constituting the share capital, adjusted (if need be) to take into account the potential increase or reduction of capital transactions having taken place during the program’s timeframe. This authorization nullifies the authorization granted to the Board of Directors by the June 17th 2010 Combined General Meeting in its Tenth ordinary resolution. The buybacks may be carried out in order to: S TRANSACTIONS COMPLETED WITHIN THE FRAMEWORK OF THE BUY BACK PROGRAM Within the framework of the Buy Back Program in effect from January 1st, 2011 to December 31, 2011, the company bought and sold its treasury shares as follows: Market-making During the 2011 fiscal year, there were 93,927 purchases and 426,020 sales/transfers. As of the closing date of the fiscal year, the number of Treasury shares is 4,051 for a value of €6,490,940.65 on the last day of the year. This number of €1 par value shares represents 0.09 % of the Capital. It should be noted that there are no trading fees other than those associa ted with the annual cost of the Liquidity Contract which amounts to €40,000 not including tax. As of March 31st, 2012, the balance sheet for the Buy-back program is the following: Number of shares held directly or indirectly: 4,978 representing 0.1107% of the Company capital. Number of shares held broken down by purposes: S S S S S ensure Secondary Market market-making or the liquidity of the AUSY share through an investment service provider using a liquidity agreement complying with the AMAFI’s Ethics Charter as allowed by the AMF; retain the bought-back shares for subsequent refloating or for use as payment in the potential event of external growth transactions, understanding that the shares bought-back for this purpose may not exceed 5% of the Company’s capital; ensure hedging of share acquisition option plans and other forms of share awards for the Group’s employees and/or Corporate Officers under the terms & conditions set by Law, specifically employee profit-sharing plans, employee savings schemes or by awards of shares for no consideration; ensure hedging of convertible securities under current regulations; cancel, if applicable, the bought-back shares in accordance with the authorization granted by the Eleventh extraordinary resolution of the Combined General Meeting of June 17th 2010. S Market making through an AMAFI Liquidity Contract: 4,978; External Growth transactions: None; Coverage for options to purchase stocks or any other employee share-ownership plan: None; Coverage for securities giving the right to an award of shares: Nil; Cancellation: None. S S S AUSY shares’ Buyback A share Buyback Program was authorized by the June 17th 2010 General Meeting’s 10th ordinary resolution and implemented by the Board of Directors meeting held following the General Meeting (description published in the 2009 Registration Document). These share buybacks may be carried out by any and all means, including through purchase of share blocks, and at the Board of Directors’ discretion. These transactions may be carried out during public offering periods under current regulations. The Company reserves the right to use options or derivatives under applicable regulations. The maximum purchase price is set at €35 per share. In the event of a transaction on the capital, notably splitting or reverse-splitting shares or the award of shares for no consideration, the above-mentio2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=120http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1206 Length Purposes Information on the Company and the share capital Information on the share capital NEW SHARE BUYBACK PROGRAM Authorization of share buyback program 06/18/2012 General Meeting (Seventh resolution) Maximum % of capital authorized 10% of the number of shares constituting the share capital, adjusted (if need be) to take into account the potential capital increases or reductions transactions that may take place during the length of the program. Maximum buyback price Maximum transaction amount €40 per share 17,980,164 18 months • ensure Secondary Market market-making or the liquidity of AUSY’s share through an investment service provider using a liquidity agreement complying with the AMAFI’s Ethics Charter as allowed by the AMF; • retain the bought-back shares for subsequent refloating or for use as payment in the potential event of external growth transactions, understanding that the shares bought-back for this purpose may not exceed 5% of the Company’s capital; • ensure hedging of share acquisition option plans and other forms of share awards for the Group’s employees and/or Corporate Officers under the terms & conditions set by law, specifically employee profit-sharing plans, employee savings schemes or by awards of shares for no consideration; • ensure hedging of convertible securities under current regulations; • cancel, if applicable, the bought-back shares, subject to the authorization to be granted by this General Meeting’s Eighth extraordinary resolution. For more information see the chapter on the General Meeting (7). REDUCTION OF CAPITAL The Eleventh resolution of the General Meeting of June 17th 2010 empowered the Board of Directors to cancel, of its own volition, in one or more instances, within the limit of 10% of the capital calculated on the day of the cancellation decision, after deducting the shares possibly canceled over the past 24 months, the shares that the Company holds or may hold following buybacks carried out in accordance with article L. 225-209 of the French Commercial Code, as well as to reduce the share capital accordingly under current legal and regulatory terms. This authorization is valid for 24 months, i.e. until June 16th 2012. The General meeting of June 18, 2012 will be asked to renew this authorization. 118 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=121http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=121Information on the Company and the share capital Information on the share capital 6 Premium on issue €10,470 €1,674.99 €1,665.51 €531,476.49 €670.45 6.2.5. Changes in equity The table below shows the changes in share capital over the past three financial years: Number of Number of shares shares created outstanding 1,030 111 162 52,284 40 104,969 94 9 2 21 16 39 46 5 8 83 797,326 48 592 246 12 28,511 73 30 367 96 28 6 3,509,815 3,509,926 3,510,088 3,562,377 3,562,412 3,667,381 3,667,475 3,667,484 3,667,486 3,667,507 3,667,523 3,667,562 3,667,608 3,667,613 3,667,621 3,667,704 4,465,030 4,465,078 4,465,670 4,465,916 4,465,928 4,494,439 4,494,512 4,494,542 4,494,909 4,495,007 4,495,035 4,495,041 Date 06/08/2009 Type of transaction Increase of Capital by converting OCEANEs into new shares Capital increase by exercise of BSAs Increase of Capital by converting OCEANEs Increase of Capital by converting OCEANEs into new shares Capital increase by exercise of BSAs Increase of Capital by converting OCEANEs into new shares Capital increase through exercise of BSAs Capital increase by exercise of BSAs Capital increase by exercise of BSAs Capital increase by exercise of BSAs Capital increase by exercise of BSAs Capital increase by exercise of BSAs Capital increase by exercise of BSAs Capital increase by exercise of BSAs Capital increase by exercise of BSAs Capital increase by exercise of BSAs Increase of Capital by cash contribution (7) Capital increase by exercise of BSA Capital increase by exercise of BSA Capital increase by exercise of BSA Capital increase by exercise of BSA Capital increase by exercise of BSA Capital increase by exercise of BSAAR Capital increase by exercise of BSA Capital increase by exercise of BSAAR Capital increase by exercise of BSAAR Capital increase by exercise of BSAAR Capital increase by exercise of BSA Par Value €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 €1.00 Amount of Capital €3,509,815 €3,509,926 €3,510,088 €3,562,377 €3,562,412 10/07/2009 01/20/2010 03/09/2010 €3,667,381 €1,067,077.31 €3,667,475 €3,667,484 €3,667,486 €3,667,507 €3,667,523 €3,667,562 €3,667,608 €3,667,613 €3,667,621 €3,667,704 €4,465,030 €4,465,078 €4,465,670 €4,465,916 €4,465,928 €4,494,439 €4,494,512 €4,494,542 €4,494,909 €4,495,007 €4,495,035 €4,495,041 €1,598.00 €153.00 €34.00 €357.00 €272.00 €663.00 €782.00 €85.00 €136.00 €1,411.00 €14,351,868 €848.91 €9,964.41 €4,159.47 €200.32 €477,606.10 €1,150.84 €504.56 €5,816.61 €2,202.42 €475.16 €102 04/15/2010 06/30/2010 07/31/2010 08/31/2010 09/30/2010 11/02/2010 12/03/2010 02/01/2011 03/01/2011 04/01/2011 05/02/2011 06/06/2011 09/06/2011 10/06/2011 11/04/2011 12/06/2011 01/09/2012 02/01/2012 03/01/2012 2011 Registration Document - AUSY 1192012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=122http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1226 Shareholders HISAM Information on the Company and the share capital Shareholders 6.3. SHAREHOLDERS 6.3.1. Breakdown of capital and voting rights As of March 31st, 2012, the Company's share capital and voting rights broke down as follows: We inform you of the identity of persons holding, directly or indirectly, at December 31st 2011, more than 5%, 10%, 15%, 20%, 25%, 30%, 33.33%, 50%, 66.66%, 90% or 95% of the share capital or voting rights at the General Meetings: Shareholdings above 5% x x x x x x x x x x x x x 10% x x 15% x x 20% x 25% x 30% 33.33% 50% 66.66% 90% 95% Jean-Marie MAGNET Odyssée Venture ALTEN MONEYA Parties acting in concert* Holding voting rights above Shareholders Jean-Marie MAGNET HISAM Georges PELTE Odyssée Venture Parties acting in concert* * 5% x x x x x 10% x x 15% x 20% x 25% x 30% 33.33% x 50% 66.66% 90% 95% x x x x x x x As of December 31st 2011, the parties acting in concert were Messrs. Jean-Marie MAGNET, Georges PELTE, Philippe MORSILLO, Fabrice DUPONT and Gérald FILLON, and the HISAM company. To the Company's knowledge, there is no shareholder who, directly or indirectly, individually or acting in concert, holds more than 5% of the share capital or voting rights. There have been no changes to this list since the close of the 2011 financial year. Moneta Asset Management, a company that acts on behalf of funds which it manages, has declared: S On April 1st 2011, Mr. Jean-Marie MAGNET, acting alone and due to an increase in the total number of shares in the AUSY Company, disclosed having crossed below the 30% threshold of AUSY’s capital and held, on an individual basis, 1,197,383 AUSY shares representing 2,237,290 voting rights, or 26.81% of the capital and 39.07% of our voting rights in our Company. On April 1st 2011, the Limited Liability company HISAM (88 Boulevard Gallieni, 92445 Issy-les-Moulineaux), acting alone and due to subscription of the AUSY Rights Issue, disclosed having crossed above the 5% and 10% thresholds of AUSY’s capital and voting rights as well as the 15% capital threshold, and held, alone, 737,680 AUSY shares representing as many voting rights, or 16.52% of capital and 12.58% of voting rights in our Company. On April 1st 2011, the Limited Liability company HISAM and the Siparex and FCID 2 funds, acting in concert with Messrs. Jean-Marie MAGNET, Fabrice DUPONT, Gérald FILLON, Philippe MORSILLO and Georges PELTE, due to subscription of the AUSY Rights Issue and combined holdings, disclosed having crossed over the AUSY Company’s capital and voting rights’ thresholds of 5%, 10%, 15%, 20%, 25%, 30%, 33.33% and 50% and held, in concert, 2,256,266 AUSY shares representing 3,455,318 voting rights, or 50.53% of the capital and 60.35% of voting rights in our Company. that on April 1st 2011 it crossed over the 5% thresholds for stock and voting rights in AUSY and held, on behalf of said funds, 303,186 AUSY shares and as many voting rights, or 6.79% of equity and 5.30% of voting rights in our Company; that on June 29th 2011 it crossed below the 5% threshold for voting rights in AUSY and held at that date, on behalf of said funds, 282,282 AUSY shares and as many voting rights, or 6.32% of equity and 4.94% of voting rights in our Company. that on April 13th 2012 it crossed below the 5% threshold for AUSY stock, and held, on behalf of said funds, 200,000 shares and as many voting rights, or 4.45% of equity and 3.37% of voting rights. S S 120 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=123http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=123Information on the Company and the share capital Shareholders 6 46.43% N/A 7.22% 60.50% 39.50% 100.00% As of the close of the financial year, the employees held no holdings in the Company’s share capital as defined by article L. 225-102 of the French Commercial Code. 6.3.2. Breakdown of capital for the last three financial years Position at 12/31/2011 Shareholders Jean-Marie MAGNET HISAM Others Registered TOTAL REGISTERED TOTAL BEARER TOTAL Position at 12/31/2010 Number of % of voting shares % of capital rights 1,197,383 N/A 605,642 1,962,170 1,705,443 32.65% N/A 16.51% 53.50% 46.50% 100.00% 46.62% N/A 11.21% 64.46% 35.54% Position at 12/31/2009 Number of % of voting shares % of capital rights 1,204,383 N/A 282,913 1,652,941 1,909,436 33.81% N/A 7.94% 46.40% 53.60% 100.00% Number of % of voting shares % of capital rights 1,195,479 868,040 425,858 2,489,377 2,005,630 4,495,007 26.60% 19.31% 9.47% 55.38% 44.62% 100.00% 40.30% 14.60% 11.30% 66.20% 33.80% 100.00% 3,667,613 100.00% 3,562,377 6.3.3. Breakdown of capital, voting rights and other dilutive equity instruments As of December 31st 2011 the Company’s share capital, voting rights and dilutive instruments broke down as follows: AUSY shares (FR0000072621) Shareholders Jean-Marie MAGNET Philippe MORSILLO Fabrice DUPONT Gérald FILLON Georges PELTE HISAM CONCERT SDMA MANAGERS Other Registered TOTAL REGISTERED TOTAL BEARER/FLOAT TOTAL BSA (FR0010505941) % 40.3% 2.5% 0.4% 5.0% 14.6% 0.0% N/A 3.4% 66.2% 33.8% BSAAR (FR0010805366) Number VR of BSAARs 0 80,000 80,000 80,000 80,000 16,000 0 336,000 129,330 149,750 127,935 825,327 51,629 876,956 Number of shares 1,195,479 150,000 1 12,057 149,145 868,040 2,374,722 0 N/A 114,655 2,489,377 2,005,630 4,495,007 % VR Number of BSAs 0 794,200 670,866 116,684 0 0 N/A 86,862 1,672,112 3,190,622 Number of shares 0 36,605 53,648 30,921 5,378 0 126,552 0 N/A 4,004 77,069 147,059 224,128 Number of shares 81,120 81,120 81,120 81,120 16,224 0 340,704 131,141 151,847 129,726 836,882 52,352 889,233 VR 81,120 81,120 81,120 81,120 16,224 0 340,704 131,141 151,847 129,726 836,882 52,352 889,233 26.6% 2,390,958 3.3% 0.0% 0.3% 3.3% 19.3% 0.0% N/A 2.6% 55.4% 44.6% 150,000 1 22,057 298,290 868,040 0 N/A 203,855 3,933,201 2,005,630 36,605 53,648 30,921 5,378 0 126,552 0 N/A 4,004 77,069 147,059 224,128 0.0% 1,163,963 52.8% 3,729,364 62,8% 2,745,713 100.0% 5,938,831 100.0% 4,862,734 In addition, note that : S S a total of 128,500 stock options were awarded during the 2011 financial year; a total of 10,000 bonus shares were awarded during the 2011 financial year. More detailled information regarding double voting rights is provided in paragraph 6.1.1 of Chapter 6. 2011 Registration Document - AUSY 1212012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=124http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1246 Shareholder HISAM In concert Information on the Company and the share capital Shareholders 6.3.4. Crossing legal threshold limits of ownership During the financial year 2011 the following threshold crossings were declared: Threshold crossed 06/29/2011 04/01/2011 04/01/2011 04/01/2011 Threshold crossed Below Below Above Above Threshold crossed 5% 30% 5%, 10%, 15% 5%, 10%, 15%, 20%, 25%, 30%, 33.33% and 50% 5% Number of shares 282,282 1,197,383 737,680 2,256,266 % held 6.32% 26.81% 16.52% 50.53% Number of voting rights 282,282 2,237,290 737,680 3,455,318 % held 4.94% 39.07% 12.58% 60.35% MONETA Asset Management Jean-Marie MAGNET MONETA Asset Management 04/01/2011 Above 303,186 6.79% 303,186 5.30% 6.3.5. Group and subsidiaries pledge of shares No shares of the Company or its subsidiaries were pledged. The September 13th 2011 Meeting of the Board of Directors authorized a pledge of AUSY business assets in place and instead of the collateral put up against the syndicated loan, involving the stock owned by AUSY PART in FINANCIÈRE APTUS. Inasmuch as all the assets of AUSY PART, APTUS and FINANCIÈRE APTUS were transmitted to AUSY, the latter had provided its lenders with new collateral to guarantee its obligations under the loan agreement. 6.3.6. Elements likely to have an impact in case of public offering During fiscal year 2011, no take over or exchange bids, or price guarantees were made by third parties on the shares of the AUSY issuer. In addition, during the same fiscal year, the Issuer did not make any public exchange offers on the shares of another company listed on a regulated market. In accordance with article L. 225-100-3 of the French Commercial Code, we inform you that the following elements could possibly have an impact in case of Public Offerings: S S French Commercial Code. To the Company’s knowledge, no other agreement or agreement between shareholders has been signed; on July 24th 2009 Messrs. MAGNET and MORSILLO, shareholders in the Company, signed an agreement to keep their stock in the Company in light of the favorable tax consequences provided by the so-called “Dutreil Law” of August 1st 2003. This agreement continued through the 2011 financial year; there are no shares offering special control rights. However, there are double voting rights for all registered Company shares after a four-year holding period. In addition, the General Meeting of January 10th 2012 voted to amend Article 36 of the Articles of incorporation with regard to voting rights, by stipulating rules for double voting rights in the event that voting rights are stripped from share ownership. Accordingly, in the event that voting rights are stripped from a fully paid-in share, the double voting right inheres to the beneficial owner in Ordinary General Meetings and to the bare owner in Extraordinary General Meetings, if their names have been registered in the Company’s stock registries for at least four years. Likewise, in the event that voting rights are stripped from a share of stock, the double voting right automatically ceases if the name of the owner (the beneficial owner in Ordinary General Meetings and the bare owner in Extraordinary General Meetings) ceases to appear on the Company’s registries, unless excepted by law; S the capital structure as well as the Company’s known direct or indirect holdings and all relevant information are detailed in chapter 2 (I and II) of this report; there is no restriction in the Articles of incorporation on exercising voting rights; a shareholders’ agreement was signed on March 1st 2011 between Messrs. MAGNET, PELTE, MORSILLO, DUPONT and FILLON and the investment funds FCPR Siparex Midmarket II, FCPR Siparex Midcap I and FCID 2. It is specified that this agreement annuls and replaces the agreement signed on July 24th 2009 and amended on September 24th 2009 between Messrs. MAGNET, PELTE, MORSILLO, DUPONT and FILLON. The parties decided to establish the aforementioned agreement as a way to regulate their relation2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=125http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=125Information on the Company and the share capital Shareholders 6 S there are no control mechanisms planned in a potential employee shareholder system with control rights that are not exercised by the former; the rules for appointing and revoking members of the Board of Directors are those laid down by law; with respect to the powers of the Board of Directors, the delegations currently in force are described elsewhere in this document; the amendment of our Company’s Articles of incorporation is performed in accordance with legal and regulatory provisions; S S S S the Company has entered into no agreements that are changed or terminated in the event of a change in control of the Company, apart from the specific clauses (i) in the OBSAAR issuance agreement, making the bonds callable under certain circumstances in the event of a change in control of the Company, and (ii) the loan agreement signed April 7th 2011 between AUSY and a syndicate of credit institutions, allowing pre-payment of the loan agreement under certain conditions; the agreements concerning severance benefits in case of termination of office of members of the Board of Directors are detailed in this document. S 6.3.7. Shareholders’ agreements As a reminder, on July 24th 2009, a shareholders’ agreement to act in concert was reached between Messrs. Jean-Marie MAGNET, Fabrice DUPONT, Gérald FILLON, Philippe MORSILLO and Georges PELTE and amended on September 24th 2009 (hence forth the “AUSY Agreement”). A new amendment to the AUSY Agreement was added on March 1st 2011, within the framework of the AUSY’s Rights Issue, to allow the following to become parties to said AUSY Agreement (i) HISAM company (ii) the venture capital investment funds Siparex Midmarket II, Siparex Midcap I (henceforth “Siparex”) and (iii) the Co-Investissement Direct 2 fund (henceforth “FCID 2”). As per this amendment, the signatories of the AUSY Agreement and the new adherents declare to be acting in concert in regards to AUSY as within the meaning of article L. 233-10 of the French Commercial Code (henceforth “the Expanded Concert”). The main amendments of the AUSY Agreement concern the following clauses: S S for Mr. Fabrice DUPONT: all transfers carried out on the 2007 BSAs, on less than 20% of the 2009 BSAARs that he directly or indirectly holds at the date of the AUSY Agreement’s signing, for Mr. Gérald FILLON: all transfers carried out on the 2007 BSAs, on less than 20% of the 2009 BSAARs that he directly or indirectly holds at the date of this document’s drafting and on the shares within the limit of 10,000 shares during the entire length of the AUSY Agreement; reciprocal pre-emption right between signatories: the AUSY Agreement provides that in instances of transfers of shares or convertible securities (other than a free transfer, as defined by the AUSY Agreement, giving no pre-emption rights): pre-emption shall be (i) at the price offered by the third party acquirer in cases of OTC sales transactions, (ii) at a price equal to the average of the closing trading prices of the 20 last trading days preceding the notification of the transfer project for transfers on the market, (iii) at the last Offering price in case of contribution to a Public Offering or (iv) at a price equal to the value at which the shares or securities shall have been appraised in the other cases. The March 1st 2011 amendment states that pre-emption rights may not be exercised by Mr. PELTE in instances of regulated transfers giving rights to the implementation of the Withdrawal Right granted to him by the AUSY Agreement; right of withdrawal and obligation of sale: the March 1st 2011 amendment states that in case of sale of Mr. Jean-Marie MAGNET’s holdings, a person is considered as having substituted himself/ herself to Mr. Jean-Marie MAGNET, if this person came to hold more than two thirds of his/her shares within the framework of a free transfer; anti-dilution clause: in case of an increase of capital (except in case of an i2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=126http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1266 Information on the Company and the share capital Shareholders 6.3.8. Employee profit-sharing plans VOLUNTARY PROFIT-SHARING PLAN To date, no Voluntary Profit-sharing has been implemented at AUSY. STATUTORY PROFIT-SHARING PLAN Employees benefit from the Statutory Profit-sharing plan applicable to companies with more than 50 employees. EMPLOYEE SAVINGS SCHEME To date, no Employee Savings Scheme has been implemented at AUSY. 124 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=127http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=127Information on the Company and the share capital Investor information 6 6.4. INVESTOR INFORMATION As of December 31st 2011, the share capital consisted of 4,495,007 shares at €1 par value, traded on EURONEXT Paris Compartment C. There is only one category of stock. As of March 31, 2012, the share capital was made up of (495,078) shares with a par value of €1. AUSY has been a listed company since April 30th 1999. The initial price per share was €21.04. Also traded on Euronext Paris: S S S BSAAR (FR0010805366) – Maturing October 20th 2016; Equity warrant (FR0010505941) – Maturing October 15th 2012; Bonds (FR0010805358) – Maturing October 20th 2014. Listing references ISIN Code Reuters Code Bloomberg Code Compartment FR000072621 OSI PA OSI FP C 2011 stock performance (in €) Month January February March April May June July August September October November December Number of trading sessions 21 20 23 19 22 22 21 23 22 21 22 21 High 23.10 23.00 22.76 25.80 27.75 26.75 27.15 23.11 23.10 22.20 21.59 21.00 Low 19.25 22.40 19.51 22.50 24.58 23.45 23.30 18.00 20.51 20.20 19.56 19.01 Closing price 22.65 22.80 22.65 24.90 26.28 26.45 24.07 22.35 20.80 22.00 20.09 20.51 Average price 21.9914 22.6184 21.3870 24.3037 26.1316 25.5936 25.0350 21.1040 21.6829 20.4940 20.4811 19.9134 Volume traded 82,004 21,065 144,857 108,238 86,677 69,699 107,258 94,739 38,084 133,330 30,233 44,741 Volume in € (based on Avg. price) 1,803,384 476,458 3,098,061 2,630,587 2,265,005 1,783,846 2,685,202 1,999,368 825,770 2,732,462 619,205 890,946 2011 Registration Document - AUSY 1252012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=128http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1286 Information on the Company and the share capital 126 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=129http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1297 7.1. 7.2. 7.3. General Meeting AGENDA Ordinary resolutions Extraordinary resolutions 128 128 128 DRAFT RESOLUTIONS Ordinary resolutions Extraordinary resolutions 129 129 130 STATUTORY AUDITORS’ SPECIAL REPORT ON REGULATED AGREEMENTS AND COMMITMENTS 135 2011 Registration Document - AUSY 1272012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=130http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1307 S S S S General Meeting Agenda 7.1. AGENDA Ordinary resolutions Approval of the Corporate Financial Statements for the year ended December 31st 2011; Approval of the Consolidated Financial Statements for the year ended December 31st 2011; Appropriation of the year’s income; Statutory Auditors’ special report on regulated agreements and commitments, approval and ratification of these agreements; S S S Renewal of Philippe MORSILLO’s term of office as Director; Setting the amount of Directors’ fees for the members of the Board; Authorization to be granted to the Board of Directors for the Company to buy back its own shares pursuant to article L. 225-209 of the French Commercial Code. Extraordinary resolutions S Authorization to be granted to the Board of Directors for the Company to cancel the shares bought back by the Company pursuant to article L. 225-209 of the French Commercial Code; Delegation of authority to be granted to the Board of Directors to issue common shares and/or convertible securities giving access to equity and/or giving entitlement to the allocation of debt securities with preemptive rights; Delegation of authority to be granted to the Board of Directors to issue common shares and/or convertible securities giving access to equity and/or giving entitlement to the allocation of debt securities, by public issue without preemptive rights; Delegation of authority to be granted to the Board of Directors to issue common shares and/or convertible securities giving access to equity and/or giving entitlement to the allocation of debt securities by private issue without preemptive rights; S Authorization, in case of issue without preemptive rights, to set the issue price according to the terms set by the Meeting, within a limit of 10% of the capital per year; Authorization to increase the amount of issue in case of excess demand; Delegation of authority to be granted to the Board of Directors to issue new stock warrants (BSA), subscription and/or acquisition of new and/or existing stock warrants (BSAANE) and/or redeemable stock warrants (BSAAR) reserved for a category of persons; Delegation of authority to be granted to the Board of Directors to increase the capital by issue of shares reserved for members of an Employee Savings Scheme, in accordance with articles L. 3332-18 et seq. of the French Labor Code; Update of the Articles of incorporation; Powers for the formalities. S S S S S S S S 128 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=131http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=131General Meeting draft resolutions 7 7.2. DRAFT RESOLUTIONS Ordinary resolutions FIRST RESOLUTION – APPROVAL OF THE CORPORATE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31ST 2011 The General Meeting, having taken note of the reports of the Board of Directors, the Chairman of the Board and the Statutory Auditors concerning the year ended December 31st 2011, approves the annual Corporate Financial Statements for the year ended on that date, as they were presented, showing a profit of €18,483,700.89. The General Meeting specifically approves the total amount of €191,000 in expenses and non-tax deductible expenses mentioned in paragraph 4 of article 39 of the French General Tax Code, and the corresponding tax of €64,000. FIFTH RESOLUTION – RENEWAL OF PHILIPPE MORSILLO’S TERM OF OFFICE AS DIRECTOR The General Meeting decides to renew Philippe MORSILLO’s term of office as Director, for a period of six years expiring at the end of the 2018 Meeting called to rule on the 2017 accounts. SIXTH RESOLUTION – SETTING THE AMOUNT OF DIRECTORS’ FEES FOR THE MEMBERS OF THE BOARD The General Meeting sets the total amount of Directors’ fees to be allocated to the Board of Directors at €80,000. This decision, applicable to the current financial year, shall be maintained until a new decision is made. SECOND RESOLUTION – APPROVAL OF THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31ST 2011 The General Meeting, having taken note of the reports of the Board of Directors, the Chairman of the Board and the Statutory Auditors for the Consolidated Financial Statements as at December 31st 2011, approves these as they were presented, showing a profit (Group share) of €13,427,865. SEVENTH RESOLUTION – AUTHORIZATION TO BE GRANTED TO THE BOARD OF DIRECTORS FOR THE COMPANY TO BUY BACK ITS OWN SHARES PURSUANT TO ARTICLE L. 225-209 OF THE FRENCH COMMERCIAL CODE The General Meeting, having taken note of the Board of Directors’ report, empowers the latter, for a period of 18 months, pursuant to articles L. 225-209 et seq. of the French Commercial Code, to buy back, on one or more occasions and at the times of its choosing, Company shares within the limit of 10% of the number of shares constituting the share capital, adjusted, if need be, to take into account the potential increase or reduction of capital transactions having taken place during the course of the program. This authorization cancels the authorization granted to the Board of Directors by the June 14th 2011 General Meeting in its sixth ordinary resolution. The buybacks may be carried out in order to: S THIRD RESOLUTION – APPROPRIATION OF THE YEAR’S INCOME The General Meeting, on the proposal of the Board of Directors, decides to allocate the income for the year ended December 31st 2011 as follows: S S Statutory reserve Balance brought forward €82,739.40 €18,400,961.49 In accordance with the terms of article 243 bis of the French General Tax Code, we remind you that no dividend was paid out over the past three years. FOURTH RESOLUTION – STATUTORY AUDITORS’ SPECIAL REPORT ON REGULATED AGREEMENTS AND COMMITMENTS AND APPROVAL AND/OR RATIFICATION OF THESE AGREEMENTS Ruling on the Statutory Auditors’ special report on the regulated agreements and commitments that were presented to it, the General Meeting approves and, where applicable, ratifies the new agreements or agreements tacitly renewed during 2011 mentioned therein. ensure market-making on the secondary market for AUSY’s share through an investment service provider using a liquidity agreement, in accordance with the AMAFI’s Ethics Charter as allowed by the AMF; retain the bought-back shares for subsequent re-issue or for use as payment for external growth transactions, it being stipulated that the shares acquired for this purpose may not exceed 5% of the Company’s capital; provide coverage to meet the obligations arising from the Company’s stock option plans and other allocations of shares to the Group’s employees and/or Corporate Office2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=132http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1327 S S General Meeting draft resolutions provide coverage of securities granting entitlement to the Company’s shares, under current regulations; cancel, if applicable, the shares acquired, subject to the authorization granted by this General Meeting in its eighth extraordinary resolution. The Company reserves the right to use options or derivatives, within the framework of applicable regulations. The maximum purchase price is set at €40 per share. In the event of a transaction on the capital, specifically a share split or reverse split, or the allocation of bonus shares, the above-mentioned amount shall be adjusted in the same proportions (multiplier coefficient equal to the ratio between the number of shares forming the capital before the transaction and the number of shares after the transactions). The maximum transaction amount is therefore set at €17,980,164. The General Meeting empowers the Board of Directors to carry out these transactions, to set the conditions and methods, to finalize all agreements and to complete all formalities. These share purchases may be transacted by any and all means, including through the purchase of share blocks, and at the Board of Directors’ discretion. These transactions may be carried out during public offering periods, in accordance with current regulations. Extraordinary resolutions EIGHTH RESOLUTION – AUTHORIZATION TO BE GRANTED TO THE BOARD OF DIRECTORS FOR THE COMPANY TO BUY BACK ITS OWN SHARES PURSUANT TO ARTICLE L. 225-209 OF THE FRENCH COMMERCIAL CODE The General Meeting, having taken note of the Board of Directors’ report and the Statutory Auditors’ special report: 1. Authorizes the Board of Directors to cancel, on its own volition, on one or more occasions, up to a maximum of 10% of the capital calculated on the day of the cancellation decision, after deducting any shares canceled over the past 24 months, the shares that the Company holds or may hold following buybacks carried out in accordance with article L. 225-209 of the French Commercial Code, as well as to reduce the share capital accordingly, in accordance with the provisions of current laws and regulations; 2. Sets the validity of this authorization at 24 months from the date of this General Meeting, i.e. June 17th 2014; 3. Grants all necessary powers to the Board of Directors to carry out the operations required to cancel the shares, to reduce the share capital accordingly, to make the corresponding changes to the Company’s Articles of incorporation, and to complete all formalities required. NINTH RESOLUTION – DELEGATION OF AUTHORITY TO BE GRANTED TO THE BOARD OF DIRECTORS TO ISSUE COMMON SHARES AND/OR CONVERTIBLE SECURITIES GIVING ACCESS TO EQUITY AND/OR GIVING ENTITLEMENT TO THE ALLOCATION OF DEBT SECURITIES, WITH PREEMPTIVE RIGHTS The General Meeting, having taken note of the Board of Directors’ report and the Statutory Auditors’ special report and in accordance with the French Commercial Code and, notably, its article L. 225-129-2: 1. Delegates authority to the Board of Directors to issue, on one or more occasions, in the proportions and at the times it sees fit, either in euro or in foreign currencies or in any other account unit set in reference to a basket of currencies: S S common shares, and/or securities giving entitlement immediately or at a later date, at any time or at a set date, to the Company’s common shares be it through subscription, conversion, exchange, reimbursement, on presentation of an equity warrant or in any other manner, and/or securities granting entitlement to the allocation of debt securities. S 130 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=133http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=133General Meeting draft resolutions 7 In accordance with article L. 228-93 of the French Commercial Code, the securities to be issued may give rights to common shares of any and all companies that directly or indirectly own over half of its capital or of which the Company directly or indirectly owns over half of the capital; 2. Sets the period of validity of this authorization at 26 months from the date of this Meeting; 3. Decides to set as follows the limits to the amounts of the authorized issues in the event this authorization is used by the Board of Directors: The total par value of the shares that may be issued by virtue of this authorization may not exceed €3,000,000. To this ceiling will be added, as needed, the par value of the common shares to be issued to preserve the rights of the holders of convertible securities giving access to equity, in accordance with the law, and where applicable, the contractual stipulations providing for other adjustments. The par value of the Company’s debt securities that may be issued by virtue of this authorization shall not exceed €25,000,000. The above ceilings are separate from all ceilings set by the other resolutions of this General Meeting; 4. Should the Board of Directors use this authorization for issues covered by 1) above, the General Meeting: a/ decides that issues of common shares or convertible securities giving access to equity shall be reserved preferably for shareholders who may subscribe shares by right, b/ decides that if subscriptions through preemptive rights, and optional subscriptions (if any) have not absorbed the entire issue mentioned at 1), the Board of Directors may use the following options: S TENTH RESOLUTION – DELEGATION OF AUTHORITY TO BE GRANTED TO THE BOARD OF DIRECTORS TO ISSUE COMMON SHARES AND/OR CONVERTIBLE SECURITIES GIVING ACCESS TO EQUITY AND/OR GIVING ENTITLEMENT TO THE ALLOCATION OF DEBT SECURITIES, BY PUBLIC ISSUE WITHOUT PREEMPTIVE RIGHTS The General Meeting, having taken note of the Board of Directors’ report and the Statutory Auditors’ special report and in accordance with the French Commercial Code and, notably, its article L. 225-136: 1. Delegates authority to the Board of Directors to issue, on one or more occasions, in the proportions and at the times it sees fit, on the french and/or international market, by public issue, either in euro or in foreign currencies or in any other account unit set in reference to a basket of currencies: S S common shares, and/or securities giving entitlement immediately or at a later date, at any time or at a set date, to the Company’s common shares be it through subscription, conversion, exchange, reimbursement, on presentation of an equity warrant or in any other manner, and/or securities granting entitlement to the allocation of debt securities. S These securities may be issued for the purpose of paying for securities contributed to the Company in an exchange offer, in accordance with the conditions set out in article L. 225-148 of the French Commercial Code. In accordance with article L. 228-93 of the French Commercial Code, the securities to be issued may give rights to common shares of any and all companies that directly or indirectly own over half of its capital or of which the Company directly or indirectly owns over half of the capital; 2. Sets the period of validity of this authorization at 26 months from the date of this Meeting; 3. The total par value of the common shares that may be issued by virtue of this authorization may not exceed €3,000,000. To this ceiling will be added, as needed, the par value of the common shares to be issued to preserve the rights of the holders of convertible securities giving access to equity, in accordance with the law, and where applicable, the contractual stipulations providing for other adjustments. This ceiling is separate from all ceilings set by the other resolutions of this General Meeting. The par value of the Company’s debt securities that may be issued by v2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=134http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1347 General Meeting draft resolutions 5. Decides that the sum due or to be due to the Company for each of the common shares issued under this delegation of authority shall be at least equal to the minimum required by the applicable legal and regulatory provisions at the time the Board of Directors implements the authorization, having taken into account, in the case of issuing autonomous stock warrants, the issue price of the said warrants; 6. Decides, in the case of the issue of securities for the purpose of paying for securities contributed to the Company in an exchange offer, in accordance with the conditions set out in article L. 225-148 of the French Commercial Code, and within the limits set out above, to grant the powers required to set the list of securities for exchange, set the issue conditions, the share-for-share basis, as well as if applicable, the amount of the equalization payment in cash, and the issue terms; 7. Decides that if subscriptions have not absorbed the entire issue mentioned at 1), the Board of Directors may use the following options: S S S common shares, and/or securities giving entitlement immediately or at a later date, at any time or at a set date, to the Company’s common shares be it through subscription, conversion, exchange, reimbursement, on presentation of an equity warrant or in any other manner, and/or securities granting entitlement to the allocation of debt securities. In accordance with article L. 228-93 of the French Commercial Code, the securities to be issued may give rights to common shares of any and all companies that directly or indirectly own over half of its capital or of which the Company directly or indirectly owns over half of the capital; S 2. Sets the period of validity of this authorization at 26 months from the date of this Meeting; 3. The total par value of the common shares that may be issued by virtue of this authorization may not exceed €3,000,000, nor may it exceed 20% of the capital per year. To this ceiling will be added, as needed, the par value of the common shares to be issued to preserve the rights of the holders of convertible securities giving access to equity, in accordance with the law, and where applicable, the contractual stipulations providing for other adjustments. This ceiling is separate from all ceilings set by the other resolutions of this General Meeting. The par value amount of the Company’s debt securities that may be issued in accordance with this authorization shall not exceed €25,000,000. This ceiling is separate from all ceilings set by the other resolutions of this General Meeting; 4. Decides to cancel shareholders’ preemptive subscription rights to common shares and to convertible securities giving access to equity and/or to debt securities covered by this resolution; 5. Decides that the sum due or to be due to the Company for each of the common shares issued under this delegation of authority shall be at least equal to the minimum required by the applicable legal and regulatory provisions at the time the Board of Directors implements the authorization, having taken into account, in the case of issuing autonomous stock warrants, the issue price of the said warrants; 6. Decides that if subscriptions have not absorbed the entire issue mentioned at 1), the Board of Directors may use the following options: S limit the issue amount to the amount of subscriptions, with the specification that in the case of issuing common shares or primary securities, the subscription amount must reach at least threequarters of the issue decided upon for this limitation to be possible, freely allocate all or part of the non-subscribed shares; S 8. Decides that the Board of Directors shall be granted, within the limits set above, the powers required to set the terms for the issue(s), and if applicable, record the execution of the resulting capital increases, proceed to amend the Articles of incorporation accordingly, levy, as it sees fit, the costs of the capital incre2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=135http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=135General Meeting draft resolutions 7 proceed to amend the Articles of incorporation accordingly, levy, as it sees fit, the costs of the capital increase on the amount of related premiums and deduct from this amount the necessary amounts to bring the statutory reserve to one-tenth of the new share capital after each increase and, more generally, perform all tasks required in such matters; 8. Notes that this authorization supersedes any and all relevant prior authorizations. Board of Directors’ report and the Statutory Auditors’ special report and in accordance with the terms of articles L. 225-129-2, L. 225-138 and L. 228-91 of the French Commercial Code: 1. Grants the Board of Directors all powers required to carry out, on one or more occasions, in the proportions and at the times of its choosing, in France and abroad, the issue of new stock warrants (BSA), subscription and/or acquisition of new and/or existing stock warrants (BSAANE) and/or redeemable stock warrants (BSAAR) reserved for a category of persons defined hereafter; 2. Sets the period of validity of this authorization at eighteen months, from the date of this Meeting; 3. Decides that the total part value of the common shares that may be issued by virtue of this authorization may not exceed €3,000,000. To this ceiling will be added, as needed, the par value of the common shares to be issued to preserve the rights of the holders of BSAs and/or BSAANEs and/or BSAARs, in accordance with the law, and where applicable, the contractual stipulations providing for other adjustments. This ceiling is separate from all ceilings set by the other resolutions of this General Meeting; 4. Decides that the subscription price of the shares acquired by exercising the warrants, after taking into account the price of issuing such warrants, shall be at least equal to the average closing price of AUSY shares for the 20 trading days preceding the decision to issue the stock warrants; 5. Decides to withdraw the preemptive rights to the BSAs and/or BSAANEs and/or BSAARs to be issued, reserved for the following category of persons: Directors, whether Corporate Officers or not, and executives of the Company or of french or foreign companies affiliated with it under the terms of article L. 225-180 of the French Commercial Code; 6. Ascertains that this authorization means that the shareholders waive their preemptive rights to shares likely to be issued by the exercising of warrants in favor of the holders of the BSAs and/or BSAANEs and/or BSAARs; 7. Decides that if subscriptions have not absorbed the entire BSA, BSAANE and/or BSAAR issue, the Board of Directors may use the following options: S S TWELFTH RESOLUTION – DETERMINE THE TERMS AND CONDITIONS FOR SETTING THE SUBSCRIPTION PRICE IN THE CASE OF ISSUE WITHOUT PREEMPTIVE RIGHTS, UP TO A MAXIMUM OF 10% OF THE CAPITAL PER YEAR The General Meeting, having taken note of the Board of Directors’ report and the Statutory Auditors’ special report and in accordance with the French Commercial Code and, notably, its article L. 225-1361, paragraph 2, authorizes the Board of Directors, which decides to issue common shares or convertible securities giving access to equity, pursuant to the tenth and eleventh resolutions, to derogate, up to a maximum of 10% of the share capital per year, from the price-setting conditions set out in the above-mentioned resolutions and to set the issue price of similar equity securities to be issued according to the following: The issue price of the equity securities to be issued immediately or at a deferred date may not be lower than (at the Board of Directors’ discretion): S either the weighted average of the Company’s share trading price on the trading day preceding the date on which the issue price is set, with a maximum discount of up to 15%; or the average of five consecutive share trading prices selected from the 30 last trading days preceding the date on which the issue price is set, with a maximum discount of up to 10%. S T2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=136http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1367 S S S S S General Meeting draft resolutions carry out the share acquisitions required within the framework of the share buyback program and allocate them, ascertain the completion of the capital increase as a result of exercising the BSAs and/or BSAANEs and/or BSAARs and amend the Articles of incorporation accordingly, by its own decision, levy the cost of the capital increase on the amount of related premiums and deduct from this amount the necessary sums to bring the statutory reserve to one-tenth of the new share capital after each increase, grant the Chairman and CEO the personal powers required to increase the capital, as well as to postpone the capital increase, within the limits and according to the conditions previously set by the Board of Directors, and more generally, perform all tasks required in such matters; 3. Sets the period of validity of this authorization at 26 months from this Meeting; 4. Limits the maximum par value amount of the increases that may be carried out through this authorization at 0.5% of the share capital amount reached upon the Board of Directors’ decision to carry out this increase, this amount being separate from any and all other ceilings set by other increase of capital authorizations; 5. Decides that the price of shares to be issued by virtue of 1) of this authorization, may not be more than 20%, or 30% when the vesting period provided by the scheme pursuant to articles L. 3332-25 and L. 3332-26 of the French Labor is greater than or equal to ten years, below the average opening price of the share on the 20 trading days preceding the Board of Directors’ decision to increase the capital and the ensuing share issue, nor higher than this average; 6. Notes that this authorization supersedes any and all relevant prior authorizations. The Board of Directors shall or shall not implement this authorization, take all measures and conduct all required formalities. 9. Notes that this authorization supersedes any and all relevant prior authorizations. FIFTEENTH RESOLUTION – DELEGATION OF AUTHORITY TO BE GRANTED TO THE BOARD OF DIRECTORS TO INCREASE THE CAPITAL BY ISSUE OF SHARES RESERVED FOR MEMBERS OF AN EMPLOYEE SAVINGS SCHEME, IN ACCORDANCE WITH ARTICLES L. 3332-18 ET SEQ. OF THE FRENCH LABOR CODE The General Meeting, having taken note of the Board of Directors’ report and the Statutory Auditors’ special report, ruling in application of articles L. 225-129-6 and L. 225-138-1 of the French Commercial Code and L. 3332-18 et seq. of the French Labor Code: 1. Authorizes the Board of Directors, should it so see fit and of its own volition, to increase the share capital on one or more occasions through the issue of common shares for consideration and, if applicable, by allocating bonus common shares or other convertible securities giving access to equity, reserved for the Company’s employees (and Corporate Officers, as well as the employees of Companies affiliated to it under the terms of article L. 225-180 of the French Commercial Code) who are members of an Employee Savings Scheme; 2. Withdraws the preemptive rights to the shares that could be issued by virtue of this authorization in favor of these persons; SIXTEENTH RESOLUTION – UPDATE OF ARTICLES OF INCORPORATION The General Meeting, having taken note of the Board of Directors’ report, decides to harmonize the first paragraph of article 46 of the Articles of incorporation, “Corporate Financial Statements”, with law no. 2011-525 regarding the simplification of the law of May 17th 2011 and to amend it as follows, leaving the remainder of the article unchanged: ”At the end of each fiscal year, in accordance with the law, the Board of Directors shall prepare the annual financial statements including the inventory of assets and liabilities existing at that date. It shall also prepare a management report, the content of which is specified by the law.” SEVENTEENTH RESOLUTION – POWERS FOR THE FORMALITIES The General Meeting grants all powers to the bearer of an 2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=137http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=137General Meeting Statutory Auditors’ special report on regulated agreements and commitments 7 7.3. STATUTORY AUDITORS’ SPECIAL REPORT ON REGULATED AGREEMENTS AND COMMITMENTS Ausy SA Year ending December 31 2011 To the Shareholders, In our capacity as Statutory Auditors of your Company, we hereby present our report on regulated Agreements and Commitments. We are required to report to Shareholders, based on the information provided, on the main terms and conditions of the Agreements and Commitments that have been disclosed to us, or that we may have uncovered during our mission, without commenting on their relevance or substance or identifying any undisclosed Agreements or Commitments. Under the provisions of article R. 225-31 of the French Commercial Code, it is the responsibility of the Shareholders to determine whether the Agreements and Commitments are appropriate and should be approved. Where applicable, it is also our responsibility to provide Shareholders with the information required by article R. 225-31 of the French Commercial Code in relation to the implementation during the year of Agreements and Commitments already approved by the General Meeting. We performed our procedures in accordance with professional standards applicable in France. These standards require us to perform procedures to verify that the information given to us agrees with the underlying documents. 1. AGREEMENTS AND COMMITMENTS SUBMITTED FOR THE APPROVAL OF THE GENERAL MEETING Pursuant to article L. 225-40 of the French Commercial Code, we were informed of the following Agreements and Commitments previously authorized by your Board of Directors. Agreement regarding the sale of shares in Ausy SA At its meeting of January 7, 2011, the Board of Directors authorized the sale of a maximum number of 330,000 Ausy SA shares held as treasury stock to Hisam, a simplified joint stock company (SAS) in which Messrs Jean-Marie Magnet, Philippe Morsillo, and Fabrice Dupont are partners. The proceeds from this agreement recognized in the 2011 financial year amounted to €6,930,000. Concerned Persons: S S S Jean-Marie Magnet – Chairman and Chief Executive Officer; Philippe Morsillo – Deputy Chief Executive Officer; Fabrice Dupont - Company Secretary. Agreement to transfer trade receivables Ausy SA sold a portion of its receivables, and those of its Ausy Belgium subsidiary to Eurofactor, as part of the Group’s receivables recovery management process. An agreement on the sale of receivables to Eurofactor was signed and approved at the Board meeting of March 16, 2011. Said agreement notably stipulates a mutual guarantee for the amounts owed to Eurofactor. This guarantee had no impact in 2011. Concerned Persons: S S Jean-Marie Magnet – Chairman and Chief Executive Officer; Philippe Morsillo – Deputy Chief Executive Officer. Joint and several guarantee agreement At its meeting of June 14, 2011, the Board of Directors authorized Ausy SA to stand as joint several guarantor for its Ausy GmbH subsidiary, regarding the fulfillment of all of the commitments entered into by that subsidiary as part of the acquisition of the Elan Group. The joint guarantee that Ausy SA provides in respect of its Ausy GmbH subsidiary involves an overall maximum amount of €11,105,000 (i.e. €7,105,000 for the purchase of 49% of the shares in the company, and €4,000,000 in respect of the repayment of the loan granted by the parent company to the target company), according to the terms of the deed of purchase. This agreement had no impact in 2011. Concerned Persons: S S Philippe Morsillo – Deputy Chief Executive Officer; Fabrice Dupont - Company Secretary. 2011 Registration Document - AUSY 1352012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=138http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1387 2. S S General Meeting AGREEMENTS AND COMMITMENTS ALREADY APPROVED BY THE GENERAL MEETING Pursuant to article R. 225-30 of the French Commercial Code, we have been informed that the following agreements and commitments, already approved by the previous years’ General Meetings, were still in effect in 2010. Intra-group financing agreement An intra-group financing agreement was entered into between Ausy SA and Ausy UK, Ausy Part, and Pentalog Technology during the 2008 and 2010 financial years. This agreement sets the framework and conditions of the relationships between the Company and its above-mentioned subsidiaries, concerning the current account loans and advances, Cash management and the distribution of financial expenses and proceeds, foreign currency risk hedging, debt write-offs and their potential reconstitutions. This agreement is valid for one year, and tacitly renewable for further one-year periods. At December 31, 2011, the financial interest charged to its subsidiaries by Ausy SA in respect of this agreement in 2011 was as follows: Ausy UK: €3,517.53; Pentalog Technology: €852.12 €. Lease management agreement between Ausy SA and its subsidiary Exalen Technologies At meeting of July 24, 2009, the Board of Directors authorized the lease previously acquired from Emi to be taken over by its subsidiary, Exalen Technologies. The lease came into effect on August 3, 2009 for a tacitly renewable period of one year. The lease payment is equal to the year’s operating income. The 2011 income recorded by Ausy SA in respect of this agreement amounted to €450,000 excluding tax. Joint and several guarantee agreement between Ausy SA and its Ausy Belgium subsidiary At its meeting of August 18, 2009, the Board of Directors authorized Ausy SA to act as joint and several guarantor on behalf of its Ausy Belgium subsidiary for all commitments entered into by the latter as part of the acquisition of the Bow Consulting holding company, an acquisition transaction authorized at the same Board meeting. Ausy SA’s joint and several guarantee is for a maximum of €22,950,000 in accordance with the deed of acquisition’s terms. Agreement on the transfer of receivables between Ausy SA and its subsidiary Exalen Technologies As part of the Group’s bad debt management process, Ausy SA sold a portion of its accounts receivable, and those of its subsidiary Exalen Technologies to Eurofactor. An agreement on the transfer of receivables to Eurofactor was signed and approved at the Board meeting of March 17, 2010. Said agreement notably stipulates a mutual guarantee for the amounts owed to Eurofactor. This guarantee had no impact in 2011. Compensation for termination of the Deputy CEO’s appointment At its meeting of June 17, 2010, the Board of Directors selected the concept of forced termination, which covers both termination and non-renewal of the Deputy CEO’s appointment, while expressly excluding resignation or a change of position within the Group. The Board also decided that, in the event of the forced termination of his office, the Deputy CEO shall receive a severance payment equal to €200,000 under the conditions set out below. It is specified that no payment shall be made if the Deputy CEO leaves Ausy SA at his own initiative, or if he changes position within the Ausy Group. Payment of this compensation is subject to the condition that the mathematical average of the current operating income ratios for the reference period is at least equal to the 2007 current operating income ratio. The reference period refers to the financial years beginning as of January 1, 2008, and published prior to the termination of the appointment. The yearly current operating income is the one appearing in the Ausy Group consolidated financial statements. The current operating income ratio corresponds to the ratio between the Ausy Group’s yearly current operating income and yearly consolidated turnover. The mathematical average is the sum of the current operating income ratios fo2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=139http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=139General Meeting 7 Centralized cash management agreement between Ausy SA and its subsidiaries At its meeting of August 25, 2010, the Board of Directors authorized the implementation of a cash management agreement between Ausy SA and Exalen Technologies, Ausy Belgium, Ausy Luxembourg PSF SA, and Ausy Gmbh. This agreement has been implemented for an undefined period and may be cancelled at any time, without providing any reason. Conditions: The main principles of this agreement are: S S S S cash centralization with weekly transfers of available cash on each subsidiary’s account to Ausy SA’s central clearing account; a return set as follows: when Ausy SA borrows from the subsidiaries, the return is set at the three-month Euribor rate less 0.20%, when a subsidiary borrows from Ausy SA, the return is set at the three-month Euribor rate plus 0.30%. In the 2011 financial year, interest income and expense in respect of this management agreement amounted to: S S €1,014.35 for Ausy Belgium; €413.02 for Ausy Luxembourg PSF SA. Paris La Défense, April 24 2012 KPMG Audit IS Paris, April 24 2012 Grant Thornton French member of Grant Thornton International Jean-Pierre Valensi Partner Muriel Boissinot-Schneider Partner 2011 Registration Document - AUSY 1372012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=140http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1407 General Meeting 138 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=141http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1418 Additional information 8.1. PUBLICLY AVAILABLE DOCUMENTS 140 8.2. THOSE RESPONSIBLE FOR THE DOCUMENT 140 8.3. AUDITORS AND FEES 8.3.1. 8.3.2. 8.3.3. 8.3.4. Statutory Auditors Substitute Statutory Auditors Fees Re-appointment 141 141 141 142 142 8.4. INDEX OF THE REGISTRATION DOCUMENT 143 8.5. CONCORDANCE OF THE ANNUAL FINANCIAL REPORT 8.6. CONCORDANCE OF THE ANNUAL MANAGEMENT REPORT 8.7. CONCORDANCE OF CSR INFO 146 147 149 2011 Registration Document - AUSY 1392012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=142http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1428 Additional information Publicly available documents 8.1. PUBLICLY AVAILABLE DOCUMENTS The Articles of Incorporation, minutes of General Meetings of Shareholders and other corporate and financial documents may be consulted at the Company's registered office or on the website: www.ausy.fr. 8.2. THOSE RESPONSIBLE FOR THE DOCUMENT I hereby declare that, to the best of my knowledge and having taken all reasonable precautions, the information contained in this Registration Document is in accordance with the facts and contains no omission likely to affect its import. I further declare that, to the best of my knowledge, the financial statements have been prepared in accordance with applicable accounting standards and give a true and fair view of the assets, liabilities, financial position, and profit or loss of the Company and all the companies in the consolidation taken as a whole, and that the Management Report (herewith) provides an accurate picture of the development and performance of the business, profit or loss and financial position of the Company and the companies in the consolidation taken as a whole, together with a description of the main risks and uncertainties that they face. I obtained a statement from the Statutory Auditors at the end of their assignment, in which they confirm that they have verified the information regarding the financial position and in the Financial Statements contained in this document, and that they have read this Registration Document in its entirety. The consolidated financial statements for year ending December 31, 2011 presented in this Registration Document have been subject to a report by the Statutory Auditors, shown in section 4.8 of this document. The report makes two observations, the first regarding the change of accounting method for retirement compensation provisions, and the second regarding the change in presentation of the business valueadded tax (CVAE) and local business tax (CET) elements. The consolidated financial statements for year ending December 31, 2010 presented in the Registration Document filed on April 29, 2011 with the Autorité des Marchés Financiers (AMF) under number D. 11-0416 were subject to a report by the Statutory Auditors, as shown in section 8.5 of said document. This report made one observation on the change in accounting treatment regarding receivables transferred to a factoring company. The consolidated financial statements for year ending December 31, 2009 presented in the Registration Document filed on April 16, 2010 with the AMF under number D. 10-0275 were subject to a report by the Statutory Auditors, and have one observation, appearing in section 8.5 of said document, on the change of accounting methods related to the application of IAS 1 (amended) “Presentation of Financial Statements” and IFRS 8 “Operating Segments”. Jean-Marie Magnet Chairman and Chief Executive Officer Issy-les-Moulineaux, April 26, 2012. 140 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=143http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=143Additional information Auditors and fees 8 Expiring 8.3. AUDITORS AND FEES 8.3.1. Statutory Auditors Identity Name Address Terms of office Representative Appointment Re-appointment KPMG AUDIT IS SAS Member, National Association of Statutory Auditors 3 cours Triangle 92939 Paris La Défense Jean-Pierre VALENSI CGM 06/17/2010 N/A 2016 GM called to approve the Financial Statements for the year ending 12/31/2015 2014 GM called to approve the Financial Statements for the year ending 12/31/2013 GRANT THORNTON Member, National Association of Statutory Auditors 100 rue de Courcelles 75017 Paris Muriel BOISSINOTSCHNEIDER CGM 6/9/2008 N/A 8.3.2. Substitute Statutory Auditors Identity Name Address Appointment Re-appointment Terms of Office Expiring 2016 GM called to approve the Financial Statements for the year ending 12/31/2015 2014 GM called to approve the Financial Statements for the year ending 12/31/2013 KPMG AUDIT ID SAS (KPMG AUDIT IS SAS Substitute) Member, National Association of Statutory Auditors Cabinet IGEC (GRANT THORNTON Substitute) Member, National Association of Statutory Auditors 3 cours Triangle 92939 Paris La Défense CGM 06/17/2010 N/A 3 rue Léon-Jost 75017 Paris CGM 6/9/2008 N/A 2011 Registration Document - AUSY 1412012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=144http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1448 Additional information Auditors and fees 8.3.3. Fees GRANT THORNTON Amount (excl. tax) In thousands of euros Audit, certification, review of Company and consolidated financial statements Incl. parent company Incl. wholly consolidated subsidiaries Other work and services directly related to the statutory audit Incl. parent company Incl. wholly consolidated subsidiaries SUB-TOTAL Other services SUB-TOTAL TOTAL KPMG Amount (excl. tax) 2010 2011 2010 2011 % 2010 Amount (excl. tax) 2011 Others % 2011 2010 % 2011 2011 2010 2010 152 140 12 34.6 34.6 186.6 34.3 34.3 220.9 95.5 83.5 12 95.5 55 55 150.5 69% 63% 5% 16% 16% 63% 55% 8% 175.5 140 35.5 36.7 36.7 0 96 83.5 12.5 0 0 0 96 96 83% 66% 17% 17% 17% 100% 87% 13% 31 19 12 - 31 19 12 31 - 100% 61% 39% 0% 100% 61% 39% 0% 84% 16% 16% 100% 63% 37% 37% 100% 212.2 212.2 100% 100% 31 100% 0% 0% 100% 100% 0% 0% 100% 100% 100% 31 31 8.3.4. Re-appointment None. 142 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=145http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=145Additional information Index of the Registration Document 8 8.4. INDEX OF THE REGISTRATION DOCUMENT To make it easier to read the annual report, on file as the Registration Document, the following table makes is possible to identify the major disclosures required by Regulation no. 809/2004 of the European Commission. Headings in Appendix 1 of EU Regulation no. 809/2004 1. 1.1. 1.2. 2. 2.1. 2.2. 3. 3.1. 3.2. 4. 5. 5.1. 5.1.1. 5.1.2. 5.1.3. 5.1.4. 5.1.5. 5.2. 5.2.1. 5.2.2. 5.2.3. 6. 6.1. 6.1.1. 6.1.2. 6.2. 6.3. 6.4. 6.5. 7. 7.1. 7.2. 8. 8.1. 8.2. Persons responsible Persons responsible for the Information Statement by the persons responsible Statutory Auditors Address Changes Selected financial information Period Information Interim Information Risk factors Information regarding the issuer History and development of the issuer Legal and commercial name Registration Date of incorporation and length of life Registered office-Legal Form-Applicable Legislation Important events Principal investments Carried-out In progress Firm future investments Business overview Principal activities Operations and principal activities New products Principal markets Exceptional events Dependence on patents and licenses Competition Organizational structure Brief description List of subsidiaries Property, plant and equipment Major existing or planned tangible fixed assets Environmental impact of the use of these fixed assets Corresponding pages of the annual report 140 140 141 142 6 NA 21 110 110 110 110 110 47 53 53 53 53 13 13 NA 14 NA 16 14 NA 46/69 73 19 2011 Registration Document - AUSY 1432012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=146http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1468 9. 9.1. 9.2. 9.2.1. 9.2.2. 9.2.3. 9.3. 10. 10.1. 10.2. 10.3. 10.4. 10.5. 11. 12. 12.1. 12.2. 13. 13.1. 13.2. 14. 14.1. 14.2. 15. 15.1. 15.2. 16. 16.1. 16.2. 16.3. 16.4. 17. 17.1. 17.2. 17.3. 18. 18.1. 18.2. 18.3. 18.4. 19. Additional information Index of the Registration Document Headings in Appendix 1 of EU Regulation no. 809/2004 Examining the financial condition and consolidated results Financial condition Net operating income Important events Changes External Influences Statutory Auditors’ reports Capital resources Capital Cash Flow Financing conditions Restrictive conditions Financing sources Research and development, patents and licenses Trend Information Trends Trend uncertainties Profit forecasts or estimates Assumptions Statutory Auditors’ report Administration, management and supervisory bodies, and senior management Information concerning members of the administrative, management or supervisory bodies Conflicts of interest with respect to administrative, management or supervisory bodies Remunerations and benefits Remuneration paid Provisions Operation of supervisory and managerial bodies Terms of office Service contracts Committees Compliance with Corporate Governance regimes Employees Staff allocation Shareholdings and stock-options Agreement for involving the employees in the capital Major shareholders Threshold-crossing Multiple voting rights Audit Shareholders’ agreement Related party transactions Corresponding pages of the annual report 55 57 67 66 NA 89 60 59 59 NA 94/95 16 14 NA NA NA NA 24 24/36 28/29 28/29 25 NA 37 35 17/83 32/77/115 53 122 111 121 123 144 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=147http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=147Additional information Index of the Registration Document 8 91 83 91 108 108 108 NA 91 NA 53 21 NA Headings in Appendix 1 of EU Regulation no. 809/2004 20. 20.1. 20.2. 20.3. 20.4. 20.4.1. 20.4.2. 20.4.3. 20.5. 20.6. 20.7. 20.8. 20.9. 21. 21.1. 21.1.1. 21.1.2. 21.1.3. 21.1.4. 21.1.5. 21.1.6. 21.1.7. 21.2. 21.2.1. 21.2.2. 21.2.3. 21.2.4. 21.2.5. 21.2.6. 21.2.7. 21.2.8. 22. 23. 23.1. 23.2. 24. 25. Financial information concerning the issuer’s assets and liabilities, financial position and profits and losses Historical financial information Pro forma financial information Financial statements Auditing of historical annual financial information Statements Other audited information Other unaudited information Date of latest financial information Interim and other financial information Dividend policy and distribution Legal and arbitration proceedings Significant change in the issuer’s financial or trading position Additional information Share capital Subscribed capital Other shares Treasury shares Securities Acquisition terms Options or agreements History of share capital Memorandum and Articles of association Purpose Management and control bodies regulation Shares’ rights and preferences Changes in shareholders’ rights Shareholders’ General Meetings Elements of change in control Ownership threshold Provisions governing changes in Articles of association Material contracts Information from third parties, appraisers’ statements and statements of interest Statements by experts Other statements Documents available to the public Information on holdings Corresponding pages of the annual report 114 114 NA 117 115/116 115/116 115 119 111 110 35 112 NA 111/128 NA 120 110 NA NA NA 140 69 2011 Registration Document - AUSY 1452012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=148http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1488 Information Additional information Concordance of the annual financial report 8.5. CONCORDANCE OF THE ANNUAL FINANCIAL REPORT This Registration Document includes all the items of a financial report referred to in articles L. 451-1-2 of the French Monetary and Financial Code and 222-3 of the AMF General Regulations. Pages 55 89 91 108 21/23/46/109/140/143 Group’s consolidated financial statements Statutory Auditors’ report on the financial statements Parent Company annual financial statements Statutory Auditors’ report on the financial statements Management Report Statement by the person in charge of the annual financial report 146 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=149http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=149Additional information Concordance of the annual Management Report 8 Pages 45 46 46 NA 48 48 53 8.6. CONCORDANCE OF THE ANNUAL MANAGEMENT REPORT This Registration Document includes all the items of a management report required by articles L. 225-100 et seq., L. 232-1, I and II and R. 225-102 et seq. of the French Commercial Code. Information Comments on the year Objective and thorough analysis of changes in the Company’s and the Group’s business, earnings, and financial condition Key non-financial performance indicators concerning the Company’s specific business Material investments or controlling interests taken during the year in companies headquartered on french soil Material events between the balance sheet date and the date the report was prepared Foreseeable changes in the Company’s and Group’s condition Dividends distributed for the three preceding years and amount of income distributed over the same three years eligible for the 40% tax allowance Items in the description of the Group Description of the principle risks and uncertainties that the Company faces The Company’s use of financial instruments: objectives and policy with respect to managing financial risk Exposure of the Company to price, credit, liquidity and cash-flow risk Social and environmental impacts of the business (including “SEVESO” facilities), and social commitments regarding the fight against discrimination and the promotion of diversity. Research and Development Activity Items Regarding Corporate Governance List of all corporate offices and positions held throughout the Company by each Corporate Officer during the past financial year Total compensation and benefits of all types paid during the year to each Corporate Officer Commitments of any kind made by the Company for the benefit of its Corporate Officers, referring to compensation, fees or benefits due or liable to be due upon or after assuming, leaving or changing their position Options granted, subscribed or purchased during the year by the Corporate Officers and each of the highest earning employees of the Company who are not Corporate Officers, and options granted to all employees, by category Terms and conditions for the exercise or vesting of options by executives who are also Corporate Officers Terms and conditions for the vesting of restricted stock awarded to executives who are also Corporate Officers Transactions in securities of the Company by executives and related persons Information about the Company and its Share Capital Rules on appointing and replacing members of the Board of Directors and the executive Committee and on amending the Articles of incorporation Authority of the Board of Directors or of the executive Committee, particularly to issue or buy back stock Detail of purchase and sales of treasury shares in the year Adjustments, if any, as to convertible securities in the event of share buyback or financial transactions Summary table of powers currently delegated by the Annual General Shareholders’ Meeting to the Board of Directors or to the executive Committee with respect to capital increases The structure of and changes in the Company’s share capital 111 111 117/118 116 114 121 25 28/29 33 21 22 22 19/21 48 30 30 30 34 2011 Registration Document - AUSY 1472012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=150http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1508 Information Additional information Concordance of the annual Management Report Pages 112 120/121 Restrictions in the Articles of incorporation as to the exercise of voting rights and the transfer of shares, or contract provisions known to the Company Direct or indirect holdings in the Company’s equity, known to the Company Status of employee ownership of Company equity at the last day of the financial year and the proportion of equity represented by stock owned by employees under a Company savings plan and by employees and former employees under a Company mutual fund List of holders of securities with special rights of control and a description of these rights Control mechanisms planned in a potential employee shareholder system with control rights that are not exercised by the former Agreements between shareholders of which the Company is aware and which might place restrictions on stock transfers or on the exercise of voting rights Agreements signed by the Company that would alter or terminate in the event of a change of control over the Company and whose disclosure, unless legally mandated, would not seriously harm the Company’s interests Agreements providing for compensation of members of the Board of Directors or employees should they resign or be dismissed without cause, or if their employment ends due to a public offering Injunctions or monetary penalties for anti-competitive practices Items regarding the financial statements Company financial performance over the last five financial years NA NA NA 123 NA NA NA 107 148 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=151http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=151Additional information Concordance of CSR info 8 Pages 17/83 17 17 17/28/29/53 8.7. CONCORDANCE OF CSR INFO This Registration Document includes all the items required by French Commercial Code articles R. 225-104 and R. 225-105 and the draft of implementing decree No. 2010-788 of July 12th 2010 (known as Grenelle 2). Information COMPANY INFORMATION Employment Total headcount (employees by gender and geographic region) Hirings (open-ended and fixed-term contracts, recruiting problems, if any) Lay-offs and firings (reasons, attempts to re-assign, re-hirings, assistance given) Compensation (changes over time, employer contributions, profit-sharing and payroll savings plans) Work arrangements Organization of working hours (length of time worked by full-time and part-time employees, overtime, outsourcing) Absenteeism (reasons) Employee relations Organization of employer-employee dialogue (rules and procedures for information, consultation and negotiation) Summary of labor agreements Charitable Works Health and Safety Health and safety conditions Agreements signed with unions or employee representatives regarding workplace health and safety Frequency and seriousness of workplace accidents and an accounting of occupational illnesses Compliance with the provisions of the ILO basic agreements Training Total number of hours of training Specific occupational training programs offered to employees Diversity and Equal Opportunity (policy in place and steps taken in this direction) Gender equality Employment and Integration of Disabled Persons Anti-discrimination and diversity efforts ENVIRONMENTAL INFORMATION General environmental policy Company organization and evaluation or certification programs Training and information given to employees concerning environmental protection Resources committed to prevent environmental risks and pollution Amount of provisions and guarantees for environmental risks 19 19/20 20 21 18 18 18 18 18 18 18 17/18 18 17/18/19 17 17 17 17 17 2011 Registration Document - AUSY 1492012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=152http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1528 Information Additional information Concordance of CSR info Pages Pollution and waste management Prevention, reduction or repair of emissions in air, water and soil that seriously impact the environment Prevention of waste production, recycling and elimination Handling of noise pollution Handling of any other form of pollution specific to an activity Sustainable use of resources Water consumption and sourcing in light of local constraints Consumption of raw materials and measures taken to use them more efficiently Consumption of energy, measures taken to improve energy efficiency and use of renewable energy Soil protection Contribution to adjusting to and combating global warming Greenhouse gas emissions Dealing with the impacts of climate change Protection of biodiversity Measures taken to avoid disruption to the biological balance, to natural environments, to protected flora and fauna SOCIETAL INFORMATION Locally environmental, economic and social impact of operations Impact of activities concerning regional employment and expansion Impact of activities on neighboring or local residents Relations with stakeholders How dialogue with stakeholders is conducted Support, partnerships and sponsorships provided Subcontractors and suppliers Consideration given to social and environmental issues in purchasing policies Importance of subcontracting Social and environmental responsibility in supplier and subcontractor relations Fair dealing and integrity Actions taken to prevent all forms of corruption Measures taken benefiting the health and safety of consumers Actions taken in support of human rights 19 21 NA 19 19 19 19 19 18 18 NA NA NA 20 NA 20 NA 20 20 20 20 150 2011 Registration Document - AUSY2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=153http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=153NOTES 2011 Registration Document - AUSY 1512012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=154http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=154NOTES2012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=155http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=1552012-06-12T18:37:21+02:00http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=156http://interactivedocument.labrador-company.com/Labrador/EN/Ausy/RegistrationDocument2011/?Page=15688 boulevard Galliéni – 92 445 Issy-les-Moulineaux Cédex Tél. : 01 41 08 65 65 – Fax : 01 41 08 14 46 www.ausy.fr2012-06-12T18:37:21+02:00