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As filed with the Securities and Exchange Commission on September 12, 2014
No. 333-195611

 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

AMENDMENT NO. 3 TO     
FORM F-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

Atento S.A.
(Exact name of registrant as specified in its charter)

Luxembourg	 	4813	 	N/A	
(State or other jurisdiction of incorporation
or organization)	 	(Primary Standard Industrial
Classification Code Number)	 	(I.R.S. Employer Identification No.)	
Da Vinci Building
4 rue Lou Hemmer
L-1748 Luxembourg Findel
Grand Duchy of Luxembourg
+352 26 78 60 1
(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

Corporation Service Company
1180 Avenue of the Americas
Suite 210
New York, New York 10036
(212) 299-5600
(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies of all communications, including communications sent to agent for service, should be sent to:

Joshua N. Korff, Esq.
Christopher A. Kitchen, Esq.
Kirkland & Ellis LLP
601 Lexington Avenue
New York, New York 10022
(212) 446-4800	 	Arthur D. Robinson, Esq.
Jaime Mercado, Esq.
Juan Francisco Méndez, Esq.
Simpson Thacher & Bartlett LLP
425 Lexington Avenue
New York, New York 10017
(212) 455-2000	
Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box:   ¨
If this Form is filed to registered additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.   ¨
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities act registration statement number of the earlier effective registration statement for the same offering.   ¨
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.   ¨

CALCULATION OF REGISTRATION FEE

 	
Title of Each Class of Securities
to be Registered	 	Amount to be
Registered	 	Proposed Maximum
Offering Price per
Share (2)	 	Proposed Maximum
Aggregate Offering
Price (1)(2)	 	Amount of
Registration Fee (2)	
Ordinary shares, no nominal value	 	20,182,500 (1)	 	$22.00	 	$444,015,000	 	$57,190 (3)	

(1)	Includes ordinary shares that the underwriters may purchase pursuant to the option to purchase additional shares.	
(2)	Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(a) under the Securities act of 1933, as amended.	
(3)	$38,640 previously paid.	

The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

 

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The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is declared effective. This prospectus is not an offer to sell nor is it soliciting an offer to buy these securities in any jurisdiction where such offer or sale is not permitted.
 
Subject to Completion, dated September 12, 2014
PROSPECTUS

Atento S.A.
14,625,000 Ordinary Shares

This is the initial public offering of ordinary shares of Atento S.A., a public limited liability company (société anonyme) organized and existing under the laws of the Grand Duchy of Luxembourg. We are offering 4,049,558 ordinary shares to be sold in this offering, and the selling shareholder identified in this prospectus is offering an additional 10,575,442 ordinary shares. We will not receive any proceeds from the sale of the ordinary shares offered by the selling shareholder.

Prior to this offering, there has been no public market for our ordinary shares. We anticipate that the initial public offering price per ordinary share will be between $19.00 and $22.00. We have applied to list our ordinary shares on the New York Stock Exchange under the symbol “ATTO.”

Investing in our ordinary shares involves risks. See “ Risk Factors ” beginning on page 21 of this prospectus.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

 
													
 	    	Per Share	 	    	Total	 	
Public offering price	    	 	$            	  	    	 	$            	  	
Underwriting discounts and commissions(1)	    	 	$            	  	    	 	$            	  	
Proceeds, before expenses, to us	    	 	$            	  	    	 	$            	  	
Proceeds, before expenses, to the selling shareholder	    	 	$            	  	    	 	$            	  	

(1)	We have agreed to reimburse the underwriters for certain expenses in connection with this offering. See “Underwriting.”	
The underwriters have a 30-day option to purchase up to 2,193,750 additional ordinary shares from the selling shareholder at the initial public offering price, less underwriting discounts and commissions payable by us.
The underwriters expect to deliver the ordinary shares against payment in New York, New York on or about                     , 2014.

 

Morgan Stanley	 	Credit Suisse	 	Itaú BBA	

							
BofA Merrill Lynch	 	Bradesco BBI	 	BTG Pactual	 	Goldman, Sachs & Co.	 	Santander	 	Baird	 	BBVA	
 
The date of this prospectus is                     , 2014.

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Table of Contents
 TABLE OF CONTENTS

					
Prospectus Summary	  	 	1	  	
Risk Factors	  	 	21	  	
Forward-Looking Statements	  	 	44	  	
Use of Proceeds	  	 	46	  	
Dividend Policy	  	 	47	  	
Capitalization	  	 	48	  	
Dilution	  	 	50	  	
Selected Historical Financial Information	  	 	52	  	
Management’s Discussion and Analysis of Financial Condition and Results of Operations	  	 	61	  	
Business	  	 	110	  	
Industry Overview	  	 	138	  	
Management	  	 	146	  	
Principal and Selling Shareholders	  	 	158	  	

Certain Relationships and Related Party Transactions	  	 	162	  	
Description of Share Capital	  	 	165	  	
Comparison of Shareholder Rights	  	 	173	  	
Enforcement of Civil Liabilities	  	 	186	  	
Description of Certain Indebtedness	  	 	189	  	
Shares Eligible for Future Sale	  	 	197	  	
Material Tax Considerations	  	 	199	  	
Underwriting	  	 	212	  	
Expenses Related to This Offering	  	 	221	  	
Legal Matters	  	 	222	  	
Experts	  	 	222	  	
Where You Can Find More Information	  	 	222	  	
Index to Financial Statements	  	 	F-1	  	

 
You should rely only on the information contained in this prospectus, any amendment or supplement to this prospectus or any free writing prospectus prepared by or on our behalf. Neither we, the selling shareholder nor the underwriters or their affiliates have authorized any other person to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. Neither we nor the selling shareholder are, and the underwriters and their affiliates are not, offering to sell these securities in any jurisdiction where their offer or sale is not permitted. This document may only be used where it is legal to sell these securities. You should assume that the information appearing in this prospectus is accurate only as of the date on the front cover of this prospectus, regardless of when this prospectus is delivered or when any particular sale of the ordinary shares occurs. Our business, financial condition, results of operations and prospects may have changed since that date.
MARKET AND INDUSTRY DATA
Market data and certain industry forecast data used in this prospectus were obtained from market research, publicly available information and industry publications and organizations, including, among others, Frost & Sullivan and IDC. Industry publications generally state that the information they contain has been obtained from sources believed to be reliable, but that the accuracy and completeness of such information is not guaranteed. Market research, while we believe it to be reliable and accurately extracted by us for the purposes of this prospectus, has not been independently verified. This prospectus also contains statements regarding our industry and our relative competitive position in the industry that are not based on published statistical data or information obtained from independent third parties, but are internal estimates based on our experience and our own investigation of market conditions. While we are not aware of any misstatements regarding the industry data presented herein, our estimates involve risks and uncertainties and are subject to change based on various factors, including those discussed under the headings “Risk Factors” and “Forward-Looking Statements.”
TRADEMARKS AND TRADE NAMES
This prospectus includes our trademarks as “Atento,” which are protected under applicable intellectual property laws and are the property of the Company or our subsidiaries. This prospectus also contains trademarks, service marks, trade names and copyrights of other companies, which are the property of their respective owners.
 
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Solely for convenience, trademarks and trade names referred to in this prospectus may appear without the ® or TM symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the right of the applicable licensor to these trademarks and trade names.
BASIS OF PRESENTATION AND OTHER INFORMATION
Except where the context otherwise requires or where otherwise indicated, the terms “Atento,” “we,” “us,” “our,” the “Company,” the “Issuer” and “our business” refer to Atento S.A., a public limited liability company ( société anonyme ) incorporated under the laws of Luxembourg on March 5, 2014, together with the entities that will become its consolidated subsidiaries prior to completion of this offering.
“AIT Group” refers to Atento Inversiones Teleservicios S.A.U. and its subsidiaries (including Atento Venezuela, S.A. and Teleatención de Venezuela, C.A.) as held by Telefónica, S.A. (together with its consolidated subsidiaries, “Telefónica” or the “Telefónica Group”) prior to the Acquisition. “Atento Group” refers to the direct and indirect subsidiaries and assets of Atento Inversiones y Teleservicios, S.A.U. (excluding Atento Venezuela, S.A. and Teleatención de Venezuela, C.A.) that were acquired indirectly by funds associated with Bain Capital Partners, LLC (together with affiliates of such funds, “Bain Capital”) on December 12, 2012 (the “Acquisition”) through Atalaya Luxco Midco S.à r.l. (the “Successor”) and certain of its affiliates. Use of the term “Predecessor” refers to the Atento Group prior to the Acquisition, and use of the term “Successor” or “Midco” refers to the Atento Group subsequent to the Acquisition.
In this prospectus, all references to “U.S. dollar” and “$” are to the lawful currency of the United States and all references to “euro” or “€” are to the single currency of the participating member states of the European and Monetary Union of the Treaty Establishing the European Community, as amended from time to time. In addition, all references to Brazilian Reais (BRL), Mexican Peso (MXN), Chilean Peso (CLP), Argentinean Peso (ARS), Colombian Peso (COP) and Peruvian Nuevos Soles (PEN) are to the lawful currencies of Brazil, Mexico, Chile, Argentina, Colombia and Peru, respectively.
The following table shows the exchange rates of the U.S. dollar to these currencies for the years and dates indicated as reported by the relevant central banks of the European Union and each country, as applicable.

 	  	2011	 	  	2012	 	  	2013	 	  	As of	 	
 	  	Average	 	  	December 31	 	  	Average	 	  	December 31	 	  	Average	 	  	December 31	 	  	September 3, 2014	 	
Euro (EUR)	  	 	0.76	  	  	 	0.77	  	  	 	0.78	  	  	 	0.76	  	  	 	0.75	  	  	 	0.73	  	  	 	0.76	  	
Brazil (BRL)	  	 	1.67	  	  	 	1.88	  	  	 	1.95	  	  	 	2.04	  	  	 	2.16	  	  	 	2.34	  	  	 	2.23	  	
Mexico (MXN)	  	 	12.44	  	  	 	13.95	  	  	 	13.16	  	  	 	12.97	  	  	 	12.77	  	  	 	13.08	  	  	 	13.09	  	
Colombia (COP)	  	 	1,847.53	  	  	 	1,942.70	  	  	 	1,797.34	  	  	 	1,768.23	  	  	 	1,869.31	  	  	 	1,926.83	  	  	 	1,930.94	  	
Chile (CLP)	  	 	483.70	  	  	 	519.20	  	  	 	486.37	  	  	 	479.96	  	  	 	495.40	  	  	 	524.61	  	  	 	591.55	  	
Peru (PEN)	  	 	2.75	  	  	 	2.70	  	  	 	2.64	  	  	 	2.55	  	  	 	2.70	  	  	 	2.80	  	  	 	2.85	  	
Argentina (ARS)	  	 	4.13	  	  	 	4.30	  	  	 	4.55	  	  	 	4.92	  	  	 	5.48	  	  	 	6.52	  	  	 	8.41	  	
PRESENTATION OF FINANCIAL INFORMATION
We present our historic financial information under International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (the “IASB”). None of the financial statements or financial information included in this prospectus has been prepared in accordance with generally accepted accounting principles in the United States of America.
 
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Predecessor Financial Statements
We have historically conducted our business through the Atento Group, or the Predecessor, up to the date of the Acquisition, and subsequent to the Acquisition, through Midco, or the Successor. Although the Acquisition was completed on December 12, 2012, for accounting purposes the Atento Group has been incorporated into the Successor’s operations since December 1, 2012.
The financial statements of the Predecessor included elsewhere in this prospectus are the audited combined carve-out financial statements of the Atento Group as of and for the year ended December 31, 2011 and as of and for the eleven-month period ended November 30, 2012 (the “Predecessor financial statements”). The Predecessor financial statements are presented on a combined carve-out basis from the AIT Group’s historical consolidated financial statements, based on the historical results of operations, cash flows, assets and liabilities of the Predecessor acquired by the Successor and that are part of its consolidated group after the Acquisition. We believe that the assumptions and estimates used in preparation of the Predecessor financial statements are reasonable. However, the Predecessor financial statements do not necessarily reflect what the Predecessor’s financial position, results of operations or cash flows would have been if the Predecessor had operated as a separate entity during the periods presented. As a result, historical financial information is not necessarily indicative of the Predecessor’s future results of operations, financial position or cash flows. See Note 2 to the Predecessor financial statements.
Successor Financial Statements
The financial statements of the Successor included elsewhere in this prospectus are the audited consolidated financial statements of Midco as of and for the one-month period ended December 31, 2012 and as of and for the year ended December 31, 2013 (the “Successor financial statements”). We have accounted for the Acquisition in the Successor financial statements using the acquisition method, by which we have recognized and measured the identifiable assets acquired and identifiable liabilities and contingent liabilities assumed at fair value at the acquisition date. The difference between the consideration paid and the fair value of the identifiable assets acquired and identifiable liabilities and contingent liabilities assumed has been recorded as goodwill. As a consequence, the assets and liabilities recognized in the financial statements of the Successor and their corresponding impact in income and expenses changed significantly as compared to the Predecessor financial statements.
Aggregated 2012 Financial Information
In addition, we also present in this prospectus unaudited, non-IFRS aggregated financial information for the year ended December 31, 2012 (the “Aggregated 2012 Financial Information”). The Aggregated 2012 Financial Information is derived by adding together the corresponding data from the audited Predecessor financial statements for the period from January 1, 2012 to November 30, 2012 and the corresponding data from the audited Successor financial statements for the one-month period from December 1, 2012 to December 31, 2012, appearing elsewhere in this prospectus, each prepared under IFRS as issued by the IASB. This presentation of the Aggregated 2012 Financial Information is for illustrative purposes only, is not presented in accordance with IFRS, and is not necessarily comparable to previous or subsequent periods, or indicative of results expected in any future period (including as a result of the effects of the Acquisition).
Interim Financial Statements
The interim financial statements of the Successor included elsewhere in this prospectus are the unaudited interim condensed consolidated financial statements of Midco as of June 30, 2014 and for the six-month periods ended June 30, 2013 and 2014 (the “Interim financial statements”).
 
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Rounding
Certain numerical figures set out in this prospectus, including financial data presented in millions or thousands and percentages, have been subject to rounding adjustments, and, as a result, the totals of the data in this prospectus may vary slightly from the actual arithmetic totals of such information. Percentages and amounts reflecting changes over time periods relating to financial and other data set forth in “Selected Historical Financial Information” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” are calculated using the numerical data in the financial statements of the Predecessor or the Successor, or the tabular presentation of other data (subject to rounding) contained in this prospectus, as applicable, and not using the numerical data in the narrative description thereof.
Reorganization Transaction
Prior to completion of this offering we will engage in the Reorganization Transaction described in “Prospectus Summary—Our History and Corporate Structure—The Reorganization Transaction” pursuant to which Midco will become a wholly-owned subsidiary of the Issuer, a newly-formed holding company incorporated under the laws of Luxembourg with nominal assets and liabilities for the purpose of facilitating the offering contemplated hereby, and which will not have conducted any operations prior to the completion of this offering. Following the Reorganization Transaction and this offering, our financial statements will present the results of operations of the Issuer. The financial statements of the Issuer will be presented in substantially the same manner as the Successor financial statements prior to this offering, as adjusted for the Reorganization Transaction. Upon consummation, the Reorganization Transaction will be reflected retroactively in the Issuer’s earnings per share calculations.
NON-GAAP FINANCIAL MEASURES
This prospectus contains financial measures and ratios, including EBITDA, Adjusted EBITDA, Adjusted Earnings/(Loss), Free Cash Flow and Net debt with third parties, that are not required by, or presented in accordance with IFRS. We refer to these measures as “non-GAAP financial measures.” For a definition of how these financial measures are calculated, see the section entitled “Selected Historical Financial Information” elsewhere in this prospectus.
We present non-GAAP financial measures because we believe that they and other similar measures are widely used by certain investors, securities analysts and other interested parties as supplemental measures of performance and liquidity. We also use these measures internally to establish forecasts, budgets and operational goals to manage and monitor our business, as well as evaluating our underlying historical performance. The non-GAAP financial measures may not be comparable to other similarly titled measures of other companies and have limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of our operating results as reported under IFRS. Non-GAAP financial measures and ratios are not measurements of our performance, financial condition or liquidity under IFRS and should not be considered as alternatives to operating profit or profit or as alternatives to cash flow from operating, investing or financing activities for the period, or any other performance measures, derived in accordance with IFRS or any other generally accepted accounting principles.
In our discussion of operating results, we have excluded the impact of fluctuations in foreign currency exchange rates by providing and explaining changes in constant currency, which is a non-GAAP financial measure. We believe changes in constant currency provides valuable supplemental information regarding our results of operations. We calculate changes in constant currency by converting our current period local currency financial information using the prior period foreign currency average exchange rates and comparing these adjusted amounts to our prior period reported results. This calculation may differ from similarly titled measures used by other companies and, accordingly, the changes in constant currency are not meant to substitute for changes in recorded amounts presented in conformity with IFRS nor should such amounts be considered in isolation.
 
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 PROSPECTUS SUMMARY
The items in the following summary are described in more detail later in this prospectus. This summary provides an overview of selected information and does not contain all the information you should consider. Therefore, you should also read the more detailed information set out in this prospectus and the financial statements. Some of the statements in this prospectus constitute forward-looking statements. See “Forward-Looking Statements.”
Except where the context otherwise requires or where otherwise indicated, the terms “Atento,” “we,” “us,” “our,” the “Company,” the “Issuer” and “our business” refer to Atento S.A., a public limited liability company (société anonyme) incorporated under the laws of Luxembourg on March 5, 2014, together with the entities that will become its consolidated subsidiaries prior to completion of this offering.
“Atento Group” refers to the direct and indirect subsidiaries and assets of Atento Inversiones y Teleservicios, S.A.U., excluding Atento Venezuela, S.A. and Teleatención de Venezuela, C.A., that were acquired indirectly by funds associated with Bain Capital Partners, LLC (together with affiliates of such funds, “Bain Capital”) on December 12, 2012 (the “Acquisition”) by Atalaya Luxco Midco S.à r.l. (“Midco”) and certain of its affiliates. Use of the term “Predecessor” refers to the Atento Group prior to the Acquisition and use of the terms “Successor” or “Midco” refers to the Atento Group subsequent to the Acquisition. “Telefónica” and “Telefónica Group” refer to Telefónica, S.A. and its consolidated subsidiaries.
Our Company
We are the largest provider of customer relationship management and business process outsourcing (“CRM BPO”) services in Latin America and Spain, and among the top three providers globally, based on revenues. Our business was founded in 1999 as the CRM BPO provider to the Telefónica Group. Since then, we have significantly diversified our client base, and subsequent to the Acquisition in December 2012, we became an independent company.
Leadership Position in Latin America . As the largest provider of CRM BPO services in Latin America, we hold #1 market share positions in most of the countries where we operate, based on revenues for the year ended December 31, 2013, according to Frost & Sullivan. From 2009 to 2012, we expanded our CRM BPO market leadership position in Latin America overall from 19.1% to 20.1% and increased our market share in Brazil from 23.3% in 2009 to 25.5% in 2013, based on revenue. We have achieved our leadership position over our 15-year history through our dedicated focus on superior client service, our scaled and reliable technology and operational platform, a deep understanding of our clients’ diverse local needs and our highly engaged employee base. Given its growth outlook, Latin America is one of the most attractive CRM BPO markets globally and we believe we are distinctly positioned as one of the few scale operators in the region.
Full Scale CRM BPO Services Offering . We offer a comprehensive portfolio of CRM BPO services, including customer service, sales, credit management, technical support, service desk and back office services. We are evolving from offering individual CRM BPO services to combining multiple service offerings, covering both the front-end and the back-end of our clients’ customer experience, into customized solutions adapted to our clients’ needs. We believe that these customized customer solutions provide an improved experience for our clients’ customers and create stronger customer relationships, which reinforces our clients’ brand recognition and enhances customer loyalty. Our services and solutions are delivered across multiple channels including digital (SMS, email, chats, social media and apps, among others) and voice, and are enabled by process design, technology and intelligence functions. In 2013, CRM BPO solutions and individual services comprised approximately 23% and 77% of our revenues, respectively. In Brazil, the CRM BPO solutions segment grew from 16% of our revenue in 2011 to 35% of our revenue in 2013.

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Our CRM BPO services and solutions are delivered through our innovative multi-channel platform. As our clients’ customers become more connected and widely broadcast their experiences across a variety of digital channels, we believe the quality of their customer experience is having a significant impact on our clients’ brand loyalty and overall business performance. Our multi-channel platform integrates direct customer outreach through digital, voice or in-person channels allowing us to engage with customers through multiple channels of interaction. As our clients’ customers increasingly transition towards digital communication, we have evolved and invested in our digital channel capabilities.
Our customized CRM BPO solutions further integrate us into the strategic objectives of our clients, often leading to closer, more resilient client relationships. For example, for a global insurance client, we provide a comprehensive solution for insurance claims management encompassing (i) specialized processes including back office, sales, customer care, credit management and technical support, (ii) a customized communication channel strategy throughout the customer’s lifecycle, (iii) workload, mobility software and communication tools and (iv) data and analytics, resulting in 25,000 monthly claims analyzed and approximately $8 million of annual savings.

Long-Standing Client Relationships Across a Variety of Industries . We work with market leaders in sectors such as telecommunications, financial services and multi-sector, which for us comprises the consumer goods, services, public administration, pay TV, healthcare, transportation, technology and media industries. In 2013, approximately 52% of our revenue was derived from sales to telecommunications, 35% to financial services and 13% to multi-sector clients. Since our founding in 1999, we have significantly diversified the sectors we serve and our client base to over 400 separate clients resulting in non-Telefónica revenue accounting for 51.5% in 2013 compared to approximately 10% of the revenue of AIT Group in 1999. In 2013, 69% of our non-Telefónica revenue was generated from clients with whom we have had relationships for ten or more years. Illustrative of our high customer satisfaction, in 2011, 2012 and 2013, our client retention rates (calculated based on prior year revenues of clients retained in current year, as a percentage of total prior year revenues) were 97.9%, 98.5% and 99.3%, respectively.
Highly Engaged Employees . Our approximately 153,000 employees worldwide are critical to our ability to deliver best-in-class customer service. We believe our distinctive culture and strong values ensure that our employees are highly engaged customer specialists. We strategically implement collaborative and proprietary training processes and firm-wide methodologies to recruit, train and retain one of the largest workforces in Latin

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America. We strive to attract, develop and reward high-performing people and to provide our employees with an attractive career path that incentivizes them to engage in achieving or exceeding our clients’ business objectives. In 2013, we were named one of the top 25 multinationals globally to work for by the Great Place to Work Institute and the only CRM BPO company in the industry to receive this distinction.
Employee benefit expenses are our single largest cost item representing $1,701.9 million (70.4% of revenues), $1,609.5 million (69.5% of revenues) and $1,643.5 million (70.2% of revenues) in 2011, 2012 and 2013, respectively. We operate in geographies with high wage inflation as in Brazil where average wage inflation based on data published by the Economist Intelligence Unit for 2012 and 2013 was 10.6% and 8.6% in 2012 and 2013, respectively. We were able to maintain employee benefit expenses stable as a percentage of revenues between 2011 and 2013 principally through the following measures (i) price increases as most of our contracts contain provisions that allow us to pass on to our customers increased costs that result from inflation adjustments, (ii) cost efficiencies related to enhanced productivity investment in our IT platform and procurement process as well as HR improvements (see “—Our Strategy—Best in Class Operations”), (iii) delivering increasingly complex solutions and value-added services to our clients positively affecting margins (see “—Our Strategy—Develop and Deliver CRM BPO Solutions”) and (iv) minimizing wage inflation through collective bargaining agreements.
Scalable and Reliable Technology and Operational Platform . We have a flexible, scalable and reliable technology platform that enables us to deliver customizable services and solutions for our clients. The three key components of our technology strategy are (i) scalable and secure infrastructure, which includes data centers, telephony and other systems, to support and automate our services, (ii) applications, including systems, analytics and intelligence tools that enhance and optimize our solution offerings and (iii) our technology organization, which consists of the people and resources to manage and innovate our platform. In 2013, our technology platform handled transactions across 89 delivery centers operating 24/7 with less than 0.06% unscheduled systems downtime. We are committed to the highest standards of quality and have implemented programs to certify relevant processes as UNE-ISO 9001 and COPC, and we use Six Sigma to ensure continuous improvement.
Strong Relationship with Telefónica Underpinned by Long-Term MSA . We believe we contribute to the Telefónica Group as an integral part of its CRM BPO operations. Currently, we serve 38 companies of the Telefónica Group under 162 arm’s-length contracts. Since becoming an independent company in December 2012, our relationship with the Telefónica Group has been governed by our master services agreement (the “MSA”). The MSA requires the Telefónica Group companies to meet pre-agreed minimum annual revenue commitments to us through 2021. The MSA commitment is meant to be a minimum commitment, rather than a target or budget. Telefónica will be required to compensate us for any shortfalls in these revenue commitments.
Our revenue generated from the Telefónica Group was $1,235.9 million in 2011, $1,158.5 million in 2012 and $1,136.5 million in 2013, reflecting a decrease of 6.3% and 1.9% for the years ended December 31, 2012 and 2013, respectively. Excluding the impact of foreign exchange, our revenue from the Telefónica Group for the years ended December 31, 2012 and 2013 increased by 3.8% and 4.7%, respectively.
Outside the ordinary course of our business and in connection with the Acquisition, we have incurred obligations to Telefónica in an aggregate amount outstanding of $67.8 million as of June 30, 2014 and $195.1 million as of December 31, 2013. For a more detailed description of such obligations, see “Description of Certain Indebtedness—Vendor Loan Note” and “Description of Certain Indebtedness—Contingent Value Instruments.”
Broad Scope of Operations . We operate in 15 countries worldwide and organize our business into the following three geographic markets: (i) Brazil, (ii) Americas, ex-Brazil (“Americas”) and (iii) Europe, Middle East and Africa, which consists of our operations in Spain, Czech Republic and Morocco (“EMEA”). For the year ended December 31, 2013, Brazil accounted for 51.5% of our revenue and 52.6% of our Adjusted EBITDA;

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Americas accounted for 33.0% of our revenue and 38.7% of our Adjusted EBITDA; EMEA accounted for 15.5% of our revenue and 8.7% of our Adjusted EBITDA (in each case, before holding company level revenue and expenses and consolidation adjustments).
Financial Flexibility . We have ample liquidity which provides significant financial flexibility to manage our operations. At December 31, 2013, the total amount of credit available to us was €50 million ($69 million) under our Revolving Credit Facility, which remained undrawn as of June 30, 2014. In addition, we had cash and cash equivalents (net of any outstanding bank overdrafts) and short-term financial investments of approximately $237.7 million as of June 30, 2014, while our outstanding debt totaled $1,366.0 million. The amount of outstanding debt attributable to the Acquisition in 2012 totaled $1,358.3 million. We expect to capitalize the full $620.7 million of preferred equity certificates, or “PECs,” outstanding as of June 30, 2014 in connection with this offering thereby reducing our total debt outstanding. See “Capitalization.” During 2013 and for the six months ended June 30, 2014, our cash flow related to interest payment and mandatory debt repayment represented 38.9% and 42.3%, respectively, of our cash flows from operating activities (before giving effect to the payment of interest). For a more detailed description of such obligations, see “Description of Certain Indebtedness.”
Our revenue for the year ended December 31, 2013 was $2,341.1 million, our Adjusted EBITDA was $295.1 million and our profit/(loss) for the period was a loss of $4.0 million. For the year ended December 31, 2012 and 2013, our revenue decreased by 4.2% and increased by 1.0%, respectively, and our Adjusted EBITDA increased by 8.6% and 10.1%, respectively. For the years ended December 31, 2012 and 2013, respectively, excluding the impact of foreign exchange, our revenue increased by 6.7% and 7.5% and our Adjusted EBITDA increased by 21.5% and 16.9%.
Our revenue for the six months ended June 30, 2014 was $1,153.6 million, our Adjusted EBITDA was $131.6 million and our profit/(loss) for the period was a loss of $24.3 million. For the six months ended June 30, 2014 compared to the same period in 2013, our revenue decreased by 1.2% and our Adjusted EBITDA increased by 6.2%. Excluding the impact of foreign exchange, our revenue increased by 9.5% and our Adjusted EBITDA increased by 16.1% in the six months ended June 30, 2014 compared to the same period in 2013.
MARKET OPPORTUNITY
CRM BPO has historically been the largest segment within the broader business process outsourcing (“BPO”) market based on revenue, and includes services such as customer care, retention, acquisition, technical support, help desk services, credit management, sales, marketing and back-office functions.
Market Size and Growth . According to IDC, global spending on CRM BPO services is expected to grow at a compound annual growth rate (“CAGR”) of 5.9% from $60.9 billion in 2013 to $81.3 billion in 2018. Our operations are primarily focused in Latin America, which is the fastest growing CRM BPO market in the world with a market size of $10.3 billion in 2013, according to Frost & Sullivan.
Key Trends in the Latin American CRM BPO Market
There are a number of trends driving growth in the Latin American CRM BPO market and we believe our market position will allow us to differentiate ourselves and capitalize on this growth.
Large CRM BPO Market with Sustained Demand Growth Driven by an Emerging Middle Class. The scale and growth of Latin America’s economies present a significant market opportunity. The growth in the CRM BPO market is supported by an expanding middle class, which is expected to grow from approximately 29% of the population in 2009 to approximately 42% by 2030, according to data from The World Bank. As a result, customer experience-intensive industries, such as insurance and banking, which have historically been underpenetrated in Latin America, have experienced high volume growth, resulting in increased demand for

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CRM BPO services. Lastly, according to Frost & Sullivan, in 2013, call center seat penetration in Latin America significantly lagged the United States, and we believe that this gap will continue to drive long-term growth for our industry in the region.
2013 Call center seats / ‘000s population

 

Source:	Frost & Sullivan and International Monetary Fund.	
Note:	Includes in-house and outsourced seats.	
Continued Trend for Further Outsourcing of CRM BPO Operations . As of 2013, 32.4% of domestic CRM BPO operations in Latin America were outsourced to third-party providers, based on number of agent seats, compared to 27.1% in 2007, according to Frost & Sullivan. In the context of high growth in CRM BPO volumes, we believe the value proposition for further outsourcing is compelling and enables our clients to (i) focus on their core capabilities, (ii) generate cost efficiencies, (iii) increase customer satisfaction, (iv) streamline the process of introducing new products and services and (v) redeploy capital used in internal processes. Given these factors, we expect outsourcing penetration in our markets to continue to grow in the future.
Limited Number of Large Scale Operators in Latin America. Very few companies operate large-scale operations throughout Latin America. Most companies operate in only one or two Latin American countries, or within multiple markets with more limited scale as compared to Atento. Establishing large scale operations in Latin America presents challenges due to specific country dynamics in the region and the complexity of managing a large and dynamic workforce. These markets are also characterized by the presence of local players with established long-term positions. For example, in Brazil, the top three providers of CRM BPO services in aggregate accounted for 59.2% of the market in 2013, whereas in North America the top three providers in aggregate had just a 16.2% share in 2012, according to Frost & Sullivan.
North America’s Continued Off-Shoring Trend. We view North America as a growth opportunity as U.S.-based businesses continue to off-shore call center services to other geographies, with 37.4% of the market off-shored in 2012, and 43.4% expected to be off-shored by 2017, according to Frost & Sullivan. Among off-shoring options, U.S. clients increasingly choose to near-shore to Latin America to eliminate challenging time zone differences that might be experienced when off-shoring to jurisdictions such as India or the Philippines. Accordingly, Latin America has evolved into the fastest growing fulfillment market for providing CRM BPO services to North America, and is expected to grow at a CAGR of 10.5% from 2012 to 2017, according to Frost & Sullivan.

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OUR STRATEGY
Our mission is to help make our clients successful by delivering the best experience for their customers. Our goal is to significantly outperform the expected market growth by being our clients’ partner of choice for customer experience solutions. We strive to deliver growth by leveraging our platform and our people as the key enablers of superior services and solutions for our clients. To this end, we are focused on optimizing our operations and inspiring our people to deliver excellent service to our clients, and our clients’ customers.
These are the pillars of our strategy and the specific initiatives by which we aim to achieve them:

Above-Market Growth
Our three main initiatives to generate higher growth than the overall market are:
Deliver CRM BPO Solutions . By further leveraging our existing infrastructure and deep client and process know-how, we are able to deliver increasingly complex solutions and value-added services to our clients through multiple channels. Over time, we have diversified and expanded our services, increased their sophistication and complexity and developed customized solutions such as smart collections, B2B (business-to-business) efficient sales, insurance management, credit management and other CRM BPO processes. Our revenue from these solutions has grown faster than our overall revenues over the past several years.
As of June 30, 2014, we served a large and diverse base of over 400 separate clients. We believe we can further penetrate these existing relationships by increasing the variety of solutions we provide. We have successfully expanded our service and solution offerings in the past and believe this is a continued growth opportunity, as we are one of the few providers that can deliver an integrated and broad set of CRM BPO solutions to a large and increasingly sophisticated client base.
Aggressively Grow Client Base . We believe we can win new client relationships, either from competitors or as potential clients outsource their in-house operations. In particular, the telecommunications sector, where we have deep industry knowledge primarily derived from our long-history with Telefónica, presents an opportunity to further increase our market share now that we are a stand-alone company. Today, we provide solutions to most of the telecommunication companies in Brazil and have acquired other telecommunications clients throughout the Americas, such as Claro (a subsidiary of América Móvil). Going forward, we are focused on growing these new relationships to scale.
To reinforce this strategic priority, we have significantly invested in our sales teams and established separate new business acquisition areas with enhanced commercial capabilities and tools.

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Penetrate U.S. Near-Shore. The market for providing outsourcing services to U.S. clients from Latin America is a sizable and fast-growing opportunity as (i) companies in the United States seek to balance outsourcing services across different geographies, generally favoring locations with better cultural fit and proximity to their operations, while minimizing time zone differences (in particular compared to jurisdictions such as India and the Philippines), (ii) Latin America becomes a more cost-competitive location and (iii) the talent pool in the region grows with more people who have strong English-language skills.
To pursue this opportunity, in 2013, we formed a dedicated business unit with its own infrastructure to exclusively serve the U.S. market which, as of April 2014, has more than 450 workstations servicing five clients including Motorola, BBVA Group and Orbitz. We believe our strong relationships with multi-national clients throughout Latin America positions us well to also serve their off-shoring needs in the United States, as exemplified by our near-shoring relationships with Motorola and BBVA Group.
Best-In-Class Operations
We have made significant investments in infrastructure, proprietary technologies, management and development processes that capitalize on our extensive experience managing large and globalized operations. Our operational excellence strategy is supported by the following five key global initiatives:
Enhance Operations Productivity . We are focused on a variety of initiatives to enhance agent productivity, including:
 
 	•	 	improving the uniformity of key performance indicators (“KPIs”) for operational productivity;	
 
 	•	 	using statistical analysis and enhanced forecasting methodology to optimize staffing levels; and	
 
 	•	 	establishing Operational Command Centers to implement analytical tools and standardized performance metrics.	
We have established an Operational Command Center in Sao Paulo, Brazil which is designed to streamline the efficiency of our operations across our delivery centers and optimize corporate functionality and management effectiveness via a standardized set of enhanced processes and capabilities. This center is equipped with the latest technology available for our purposes and serves to enhance our ability to shift resources as needed, in real-time, based on client requirements. Additionally, it provides our management immediate analytics and continuous data enabling them to streamline processes that we expect will offer the optimal customer experience for our clients.
Increase HR Effectiveness . Our business model is focused on improving operations HR effectiveness, developing our people and reducing turnover, driving both performance and reduction in costs. Recruiting, selecting and training talent is a key factor in the successful delivery of our CRM BPO services and solutions. We have adopted a comprehensive approach to HR management, with a number of global initiatives under way that are designed to diversify our candidate sourcing ( e.g ., social media), refine agent selection methods focused on better fit to reduce early turnover, and improve training to develop the best talent. We are also continually aligning HR processes and incentive plans to foster employee retention.
Deploy One Procurement . We are strengthening our centralized procurement model in order to lower costs and streamline supplier relationships. Our “Global Deal Delivered Locally” strategy allows us to work with vendors to reach global contracts, while allowing procurement decisions to be handled locally. For example, by sourcing agent headsets as part of a global contract, we were able to achieve significant savings across all of our geographies, ranging from 5% to 82% of net unit headset costs. We are continuing to deploy this procurement strategy across our business, including in our procurement of infrastructure, technology, telecommunications and professional services, to reduce operating costs and improve margins.

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Drive Consistent and Efficient IT Platform . Our technology strategy is focused on (i) delivering a cost-efficient and reliable IT infrastructure to meet the needs of existing clients and support margin expansion, (ii) enhancing our ability to add capacity rapidly with a highly variable cost structure for new business, (iii) developing new products and solutions that can be rapidly scaled and rolled out across geographies, (iv) providing standard operational tools and processes to enable the best experience to our clients’ customers and (v) establishing common platforms that facilitate centralization of core IT services. Technology initiatives to capture benefits of scale, standardization, and consolidation are managed globally, with full accountability by project leaders to continuously optimize our operations and innovate client solutions.
Optimize Site Footprint . We continue to relocate a portion of our delivery centers from tier 1 to tier 2 cities, as we seek to optimize lease expenses and reduce employee benefit expenses by focusing on reducing turnover and absenteeism. Additionally, the relocation of delivery centers allows us to access and attract new and larger pools of talent in locations where Atento is considered a reference employer. We have completed several successful site transfers in Brazil. In Brazil, the percentage of total workstations located in tier 2 cities increased from 44% in 2011 to 54% in 2013. Currently, we are planning to move more than 1,700 workstations in Brazil to tier 2 cities by the end of 2014. As demand for our services and solutions grows and their complexity continues to increase, we continue to evaluate and adjust our site footprint to create the most competitive combination of quality of service and cost effectiveness.
In addition, given the size of our workforce, our operational excellence strategy is targeted at supporting the future growth of our business and delivering efficiency gains while mitigating costs, in particular wage inflation in the markets where we operate.
Inspiring People
Distinct Culture and Values . We believe that our people are a key enabler to our business model and a strategic pillar to our competitive advantage. We have created, and constantly reinforce, a culture we believe is unique in the industry. We believe our distinctive culture and strong values ensure our employees are highly capable and committed customer specialists. Our operational policies encourage collaboration and entrepreneurship, emphasize trust, passion and integrity, and commitment to our clients. We believe we can deliver growth and outstanding customer experiences through inspired, committed people who share our vision and are guided by our values. We constantly reinforce our core values through working groups, surveys, and leadership assessment processes that focus on upholding our core values and result in individualized development plans.
Strengthen Talent . We have developed processes to identify talent (both internally and externally), created individualized development plans and designed incentive plans that foster a work environment that aligns our management’s professional development with client objectives and our goals, including efficiency objectives, financial targets and client and employee satisfaction metrics. Furthermore, we continuously reassess our talent pool and recruit experienced professionals in the services industry to complement our strengths and capabilities. Given our focus on developing our people, we believe we empower our teams and provide opportunities and tools to act like owners, committed to delivering excellence and achieving superior performance.
High Performance Organization . We have implemented a new operating model that integrates the corporate organization globally, allowing us to capture the benefits of scale, standardization and sharing of best practices. The corporate organization is integrated globally but strategically segmented into different operating regions. This ensures that corporate functions remain close to their businesses and clients, utilize a deeper understanding of the local industry levers, and are committed to the successful implementation of the initiatives on a regional level. We believe that this new organizational structure will foster agility and simplicity, while ensuring that corporate leaders are focused on coordinating, communicating and pursuing new solutions and innovation, with full accountability on the results.

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OUR COMPETITIVE STRENGTHS
We benefit from the following key competitive strengths in our business:
Category Leader in a Large Market with Long-Term Secular Growth Trends
We are currently the leading provider of CRM BPO services and solutions in Latin America and among the top three providers globally, based on revenue, according to Frost & Sullivan. In 2012, we were the leading provider of outsourced CRM BPO services in the rapidly growing Latin American market overall with a 20.1% market share by revenue, compared to 19.1% in 2009. In addition, we were the leading provider of outsourced CRM BPO services by market share based on revenue in 2013 in Peru, Brazil, Argentina, Spain, Chile and Mexico, according to data published by Frost & Sullivan (except for Spain, which refers to market share data for 2011, and Brazil which represents management’s estimate as of Q1 2014).
Atento 2013 Market Share and Position by Country

 

Source:	Frost & Sullivan.	
(1)	Brazil market share based on Frost & Sullivan, market share position as of Q1 2014 (management estimate).	
(2)	Spain market share as of 2011.	
According to Frost & Sullivan, we have increased our market share of the CRM BPO market in Brazil from 23.3% in 2009 to 25.5% in 2013, second only to Contax Participações, S.A., whose market share declined from 29.8% to 27.3% in Brazil over the same period. We generated BRL693.0 million ($306.7 million) and BRL681.3 million ($288.9 million) of revenues in Brazil in the fourth quarter of 2013 and first quarter of 2014 respectively while Contax reported revenues for its contact center division in Brazil of BRL683.9 million ($300.5 million) and BRL636.5 million ($273.6 million), respectively, in those periods. Based on this data, we believe we are now the leading CRM BPO provider in Brazil.
Comprehensive, Customizable Suite of CRM BPO Solutions across Multiple Channels
We believe that our position as a provider of innovative CRM BPO solutions is a key factor for our gain in market share in recent years, and will be a driver of our expected outperformance. As we continue to evolve towards customized client solutions and variable pricing structures, we seek to create a mutually beneficial partnership that increases the portion of CRM BPO services we provide to our clients. We intend to develop and expand our portfolio of customized solutions as we continue to leverage our deep knowledge of our clients’ outsourcing needs.
In the context of the continuing evolution and proliferation of digital communication technologies and devices, we are focused on and continue to invest in research and development to anticipate the changing habits

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of customers and how our clients ultimately engage with them across a growing array of communication channels including SMS, email, chats, social media and apps, among others.
Long-Standing, Blue-Chip Client Relationships in Multiple Industries
Our long-standing, blue-chip client base across a variety of industries includes Telefónica Group, BBVA Group, Banco Bradesco S.A., Carrefour, Claro, Elavon, HSBC, Itaú, L’Oreal, McDonald’s, Motorola, Santander, Samsung and Zurich, among others, with Telefónica Group representing 48.5% of our revenue for 2013 and the other clients representing, individually, less than 10% of our revenue for 2013. Including Telefónica, our top 10 clients represented 80.3% of our 2013 revenues. For each of these clients, our relationship usually encompasses multiple contracts, services and countries. Our clients include leaders and innovators in their respective industries who demand best-in-class service from their outsourcing partners. By aligning ourselves with their success to partner in the long term, we have expanded the scope of our services and solutions while helping our clients deliver their brand promise. We believe that this approach has allowed us to develop and nurture longstanding relationships with existing clients which have provided us with stable revenue year-to-year.
Additionally, we believe it is costly and presents risks for our clients to switch a large number of workstations to competitors due to the potential disruption caused to the client’s customers, the extensive employee training required and the level of process integration between the client and CRM BPO provider.
Value-Added Partner with Differentiated Technology Platform
We have a scalable and reliable technology platform that we believe is a significant competitive differentiator. Our technology platform allows us to be a value-added partner to our clients by providing upfront customer engagement process design, hosting and managing numerous customer management environments, offering multi-channel communication delivery and sophisticated data and analytics, which provide deep insight into each interaction with a client’s customer.
Focus on HR Management to Deliver Superior Customer Experiences
We believe employee satisfaction is a key differentiator in maintaining and growing a high performance organization to deliver a superior customer experience compared to our competitors and clients’ in-house operations. We leverage our distinctive culture and values as well as our deep understanding of regional cultural intricacies to create a work environment that aligns client objectives with employee incentives and commitment. We believe well-trained, highly-committed customer specialists, who are rewarded for results, enhance performance in our clients’ CRM operations. In 2013, we were named one of the top 25 companies to work for according to Great Place to Work Institute’s ranking of the World’s Best Multinational Workplaces, putting us alongside companies such as Google, Microsoft and The Coca-Cola Company in terms of employee satisfaction. Furthermore, as of September 3, 2014, we have received the most country-level Great Place to Work prizes in the CRM BPO industry.
Highly Experienced and Motivated Management Team
We benefit from the significant experience and knowledge of our management team. We inherited experienced, motivated local talent, with many members of our senior management having played an instrumental role in growing and establishing us as a global leader in the years prior to the Acquisition. Most of our operational managers have worked with us for over ten years, which has allowed us to accumulate valuable operational experience and deep vertical expertise, while building and maintaining close relationships with our key clients. As part of our transition to a standalone company, we complemented our management team with a new Chief Financial Officer, Chief Technology Officer, Chief Commercial Officer and Chief Procurement Officer to build a truly world class management team. This team is fully committed to building upon our market leadership and driving our transformational growth.

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OUR HISTORY AND CORPORATE STRUCTURE
The Atento business was founded in 1999 in Madrid, Spain. In 1999, we generated less than $50 million (at the average €/USD 1999 exchange rate) in revenue and operated fewer than 20,000 workstations and Telefónica accounted for nearly 90% of our total sales. Bain Capital acquired the Atento Group from Telefónica on December 12, 2012 pursuant to the terms of a purchase agreement (the “SPA”) dated as of October 11, 2012, among Atento Luxco 1 S.A. (“Atento Luxco”) and certain of its affiliates, and Telefónica. In 2013, we generated more than $2.3 billion in revenue and operated more than 81,000 workstations. For the six months ended June 30, 2014, Telefónica accounted for 46.7% of our revenue.
The Issuer was incorporated on March 5, 2014 as a Luxembourg public limited liability company ( société anonyme ). It is registered with the Luxembourg Registry of Trade and Companies under number B.185.761. Its registered office is located at 4 rue Lou Hemmer, L-1748 Luxembourg Findel, Grand Duchy of Luxembourg, telephone number +352 26 78 60 1.
Our principal executive offices are located at C/Quintanavides, N. 17—2 Planta, 28050 Las Tablas, Madrid, Spain. Our website can be found at www.atento.com . Information on, or accessible through, our website is not part of and is not incorporated by reference in this prospectus, and you should rely only on the information contained in this prospectus when making a decision as to whether to invest in our ordinary shares.
The Reorganization Transaction
The Issuer was formed as a direct subsidiary of Atalaya Luxco Topco S.C.A. (“Topco”). In connection with the issuance of the PIK Notes (see “Certain Relationships and Related Party Transactions—PIK Notes due 2020”), in April 2014, Topco also incorporated Atalaya Luxco PIKCo S.C.A. (“PikCo”) and on May 15, 2014 Topco contributed to PikCo: (i) all of its equity interests in its then direct subsidiary, Atalaya Luxco Midco S.à r.l. (“Midco”), the consideration for which was an allocation to PikCo’s account “capital contributions not remunerated by shares” (the “Reserve Account”) equal to €2 million, resulting in Midco becoming a direct subsidiary of PikCo; and (ii) all of its debt interests in Midco (comprising three series of preferred equity certificates (the “Original Luxco PECs”)), the consideration for which was the issuance by PikCo to Topco of preferred equity certificates having an equivalent value. On May 30, 2014, Midco authorized the issuance of, and PikCo subscribed for, a fourth series of preferred equity certificates (together with the Original Luxco PECs, the “Luxco PECs”).
Prior to the completion of this offering, Topco will transfer its entire interest in the Issuer (being €31,000 of share capital) to PikCo, the consideration for which will be an allocation to PikCo’s Reserve Account equal to €31,000. PikCo will then contribute (the “Contribution”) all of the Luxco PECs to Midco, the consideration for which will be an allocation to Midco’s Reserve Account equal to the value of the Luxco PECs immediately prior to the Contribution. Upon completion of the Contribution, the Luxco PECs will be cancelled by Midco. PikCo will then transfer the remainder of its interest in Midco (being €12,500 of share capital) to the Issuer, in consideration for which the Issuer will issue two new shares of its capital stock to PikCo. The difference between the nominal value of these shares and the value of Midco’s net equity will be allocated to the Issuer’s share premium account. As a result of such transfer, Midco will become a direct subsidiary of the Issuer. In connection with this offering, the Issuer will also undertake a share split whereby the Issuer will issue approximately 2,219.35 shares for each share outstanding. We refer to the foregoing transactions collectively as the “Reorganization Transaction.”
In addition, in connection with this offering, Topco will redeem certain equity interests of members of our management in Topco. At the midpoint of the price range set forth on the cover page of this prospectus, this redemption will result in aggregate cash proceeds of $1.3 million to members of our management, and the maximum cash proceeds to any eligible individual will be approximately $0.3 million. Further, upon

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consummation of this offering we expect certain members of our management to receive (through their shared investment vehicle) in exchange for the redemption of their remaining equity interests in Topco pursuant to a redemption agreement, approximately 1,210,583 ordinary shares of the Issuer following the transfer thereof by PikCo to Topco.
Following completion of this offering, Topco, through its ownership of PikCo, will, directly or indirectly, beneficially own approximately 78% of the Company’s outstanding ordinary shares, or 75% if the underwriters’ option to purchase additional shares is fully exercised. Bain Capital will continue to control Topco and, as a result, will be able to have a significant influence on fundamental and significant corporate matters and transactions. See “Risk Factors—Risks Related to Our Ordinary Shares and this Offering—Control by Bain Capital could adversely affect our other shareholders.”
Corporate Structure
The following chart summarizes our corporate ownership structure immediately following the consummation of this offering. Note 3(t) to the Successor financial statements included elsewhere in this prospectus provides a complete listing of the subsidiaries of the Successor, including their name, country of incorporation or residence, and portion of ownership interest or voting power held, if applicable (1) .

 

(1)  	Figures in chart may not sum precisely due to rounding.	

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RISKS ASSOCIATED WITH OUR COMPANY
Investing in our ordinary shares involves a significant degree of risk. See “Risk Factors” beginning on page 19 of this prospectus for a discussion of factors you should carefully consider before deciding to invest in our ordinary shares. These risks include, among others:
 
 	•	 	The CRM BPO market is very competitive.	
 
 	•	 	Telefónica, certain of its affiliates and a few other major clients account for a significant portion of our revenue and any loss of a large portion of business from these clients could have a material adverse effect on our business, financial condition, results of operations and prospects.	
 
 	•	 	A substantial portion of our revenue, operations and investments are located in Latin America and we are therefore exposed to risks inherent in operating and investing in the region.	
 
 	•	 	Any deterioration in global market and economic conditions and, in particular, in the telecommunications and financial services industries from which we generate most of our revenue, may adversely affect our business, financial condition, results of operations and prospects.	
 
 	•	 	Increases in employee benefits expenses as well as changes to labor laws could reduce our profit margins.	
 
 	•	 	We are a Luxembourg public limited liability company ( société anonyme ) and it may be difficult for you to obtain or enforce judgments against us or our executive officers and directors in the United States.	
 
 	•	 	Control by Bain Capital could adversely affect our other shareholders.	
 
 	•	 	Our existing debt may affect our flexibility in operating and developing our business and our ability to satisfy our obligations.	

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THE OFFERING
The following is a brief summary of the terms of this offering and should be read together with the more detailed information and financial data and statements contained elsewhere in this prospectus. For a more complete description of our ordinary shares, see “Description of Share Capital” in this prospectus.

		
Issuer	  	Atento S.A.	
		
Ordinary Shares Offered:	  		
		
By us	  	4,049,558 ordinary shares.	
		
By the Selling Shareholder	  	10,575,442 ordinary shares.	
		
Total	  	14,625,000 ordinary shares.	
		
Option to Purchase Additional Shares	  	The selling shareholder has granted the underwriters an option, exercisable within 30 days from the date of this prospectus, to purchase from the selling shareholder up to an aggregate of 2,193,750 additional ordinary shares, respectively.	
		
Ordinary Shares to be Outstanding After This Offering	  	
72,849,558 ordinary shares (whether or not the underwriters exercise their option to purchase additional ordinary shares from the selling shareholder).	
		
Use of Proceeds	  	We estimate that the net proceeds to us from this offering, after deducting underwriting discounts and commissions (including commissions payable in respect of the sale of ordinary shares by the selling shareholder, estimated at $11.9 million, or $14.4 million if the underwriters exercise their option to purchase 2,193,750 additional ordinary shares from the selling shareholder) and estimated offering expenses (including fees payable to Bain Capital Partners, LLC) payable by us, will be approximately $30.5 million (or $28.0 million if the underwriters exercise their option to purchase additional ordinary shares from the selling shareholder), assuming the ordinary shares are sold at $20.50 per ordinary share, the midpoint of the price range set forth on the cover page of this prospectus.	
		
	  	We estimate that net proceeds to the selling shareholder will be approximately $216.8 million, or $261.8 million if the underwriters exercise their option to purchase additional shares in full, assuming the ordinary shares are sold at $20.50 per ordinary share, the midpoint of the price range set forth on the cover page of this prospectus. In addition to other fees payable to Bain Capital Partners, LLC in connection with the offering totaling $26.0 million (including a transaction fee of $3.0 million and termination fees of $23.0 million payable in connection with our agreements with Bain Capital Partners, LLC), we expect total net proceeds payable	
	  	to Bain Capital Partners, LLC (including amounts payable by us and amounts expected to be distributed	

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	  	by the selling stockholder, after giving effect to the repurchase of PIK Notes) to be approximately $121 million (or $161.0 million if the underwriters exercise their option to purchase 2,193,750 additional ordinary shares from the selling shareholder). We will not receive any proceeds from the sale of ordinary shares by the selling shareholder. We expect that the selling shareholder will use $108 million of the net proceeds received by it (or $137.9 million if the underwriters exercise their option to purchase additional ordinary shares from the selling shareholder) to offer to repurchase a portion of the PIK Notes due 2020 issued by PikCo, as required by the terms of the indenture related to the PIK Notes. See “Certain Relationships and Related Party Transactions—PIK Notes due 2020.”	
		
	  	We intend to use the net proceeds to us from the sale of ordinary shares in this offering, together with cash on hand, to repay the entire outstanding amount due under our vendor loan note issued to an affiliate of Telefónica in connection with the Acquisition, of which $31.4 million (at the exchange rate prevailing as of June 30, 2014) remains outstanding as of June 30, 2014 (the “Vendor Loan Note”). We will use any remaining net proceeds from this offering for general corporate purposes. See “Use of Proceeds” and “Description of Certain Indebtedness.”	
		
Dividend Policy	  	Although we expect to be well capitalized following the Reorganization Transaction prior to the completion of this offering and we have sufficient liquidity, our ability to pay dividends on our ordinary shares is limited in the near-term by the indenture governing our existing 7.375% Senior Secured Notes due 2020 (the “Senior Secured Notes”), the BRL915 million non-convertible, secured debentures due 2019 (the “Brazilian Debentures”), the Vendor Loan Note and our Contingent Value Instruments (“CVIs”), and may be further restricted by the terms of any of our future debt or preferred securities. See “Description of Certain Indebtedness.” To the extent we are in a position under our debt documentation to pay cash dividends, we will endeavor to pay cash dividends to our shareholders. However, any future determinations relating to our dividend policies will be made at the discretion of our board of directors and will depend on various factors. See “Dividend Policy.”	
		
Lock-Up Agreements	  	We, our directors, executive officers, all of our existing shareholders, option holders and PikCo, have agreed with the underwriters, subject to certain exceptions, not to sell, transfer or dispose of any of our shares or similar securities for 180 days after the date of this prospectus. See “Underwriting.”	

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Listing	  	We have applied to list our ordinary shares on the New York Stock Exchange under the symbol “ATTO.”	
		
Risk Factors	  	See “Risk Factors” and other information included in this prospectus for a discussion of factors you should carefully consider before deciding to invest in our ordinary shares.	
The number of our ordinary shares to be issued and outstanding after this offering is based on 68,800,000 ordinary shares issued and outstanding as of September 3, 2014, giving effect to the approximately 2,219.35-for-1 share split to be effectuated prior to completion of this offering and excluding 7,300,000 ordinary shares reserved for future issuance under our share-based compensation plans.
Except as otherwise indicated, all information in this prospectus:
 
 	•	 	assumes an initial public offering price of $20.50 per share, the midpoint of the estimated price range set forth on the cover page of this prospectus;	
 
 	•	 	gives effect to the share split whereby the Issuer will issue approximately 2,219.35 for each 1 ordinary share outstanding as of September 3, 2014, to be effectuated prior to completion of this offering; and	
 
 	•	 	assumes no exercise of the underwriters’ option to purchase additional shares.	

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SUMMARY CONSOLIDATED HISTORICAL FINANCIAL INFORMATION
The following tables present summary consolidated historical financial information for the periods and as of the dates indicated and should be read in conjunction with the section of this prospectus entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Selected Historical Financial Information” and the financial statements included elsewhere in this prospectus.
Historically, we conducted our business through the Predecessor through November 30, 2012, and subsequent to the Acquisition, through the Successor, and therefore our historical financial statements present the results of operations of Predecessor and Successor, respectively. Prior to completion of this offering, we will implement the Reorganization Transaction pursuant to which the Successor will become a wholly-owned subsidiary of the Issuer, a newly-formed public company incorporated under the laws of Luxembourg with nominal assets and liabilities for the purpose of facilitating this offering, and which will not have conducted any operations prior to the completion of this offering. Following the Reorganization Transaction and this offering, our financial statements will present the consolidated results of operations of the Issuer. The consolidated financial statements of the Issuer will be substantially the same as the consolidated financial statements of the Successor prior to this offering, as adjusted for the Reorganization Transaction. Upon consummation, the Reorganization Transaction will be reflected retroactively in the Issuer’s earnings per share calculations. See “—The Reorganization Transaction.”
The following table sets forth summary historical financial data of the Atento Group. We prepare our financial statements in accordance with IFRS as issued by the IASB. As a result of the Acquisition, we applied acquisition accounting whereby the purchase price paid was allocated to the acquired assets and assumed liabilities at fair value. Our financial reporting periods presented in the table below are as follows:
 
 	•	 	Solely for purposes of the summary historical financial information in this section, the Predecessor period refers to the year ended December 31, 2011 and the period from January 1, 2012 through November 30, 2012 and reflects the combined carve-out results of operations of the Predecessor.	
 
 	•	 	The Successor period reflects the consolidated results of operations of the Successor, which includes the effects of acquisition accounting for the one-month period from December 1, 2012 to December 31, 2012, for the year ended December 31, 2013 and for the six-month periods ended June 30, 2013 and 2014.	
The summary combined carve-out historical financial information as of and for the year ended December 31, 2011, as of November 30, 2012 and for the period from January 1, 2012 to November 30, 2012 presented below were derived from the Predecessor financial statements included elsewhere in this prospectus.
The summary consolidated historical financial information as of December 31, 2012 and for the one-month period from December 1, 2012 to December 31, 2012 and as of and for the year ended December 31, 2013 presented below were derived from the Successor financial statements included elsewhere in this prospectus.
The summary consolidated historical financial information as of June 30, 2014 and for the six-months ended June 30, 2014 and 2013 presented below were derived from the Interim financial statements included elsewhere in this prospectus.
Historical results for any prior period are not necessarily indicative of results expected in any future period.
The unaudited Aggregated 2012 Financial Information set forth below is derived by adding together the corresponding data from the audited Predecessor financial statements for the period from January 1, 2012 to November 30, 2012, to the corresponding data from the audited Successor financial statements for the one-month period from December 1, 2012 to December 31, 2012, appearing elsewhere in this prospectus, each prepared under IFRS as issued by the IASB. This presentation of the Aggregated 2012 Financial Information is for

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illustrative purposes only, is not presented in accordance with IFRS, and is not necessarily comparable to previous or subsequent periods, or indicative of results expected in any future period (including as a result of the effects of the Acquisition).

 	 	Predecessor	 	 	  	 	 	 	Successor	 	 	Non-IFRS
Aggregated	 	 	 	 	 	 	 	 	Successor	 	 	 	 	 	 	 	 	Successor	 	 	Change
%	 	 	Change
excluding
FX
%	 	
 	 			 	  	 	 	 			 			 	Change
%	 	 	Change
excluding
FX
%	 	 			 	Change
%	 	 	Change
excluding
FX
%	 	 			 			 			
($ in millions other
than share and per
share data)	 	As of and
for the year
ended
December 31,
2011	 	 	As of and
for the
period
from Jan 1
– Nov 30,
2012	 	 		 		 	As of and
for the
period
from Dec 1
– Dec 31,
2012	 	 	For the year
ended
December 31,
2012
(unaudited)	 	 			 			 	As of and for
the year
ended
December 31,
2013	 	 			 			 	For the six
months
ended
June 30,
2013
(unaudited)	 	 	For the six
months
ended
June 30,
2014
(unaudited)	 	 			 			
Income statement data:	 				 				 	 	 		 				 				 				 				 				 				 				 				 				 				 				
Revenue	 	 	2,417.3	  	 	 	2,125.9	  	 	 	 		 	 	190.9	  	 	 	2,316.8	  	 	 	(4.2	) 	 	 	6.7	  	 	 	2,341.1	  	 	 	1.0	  	 	 	7.5	  	 	 	1,167.1	  	 	 	1,153.6	  	 	 	(1.2	) 	 	 	9.5	  	
Operating profit/(loss)	 	 	155.6	  	 	 	163.8	  	 	 	 		 	 	(42.4	) 	 	 	121.4	  	 	 	(22.0	) 	 	 	(10.3	) 	 	 	105.0	  	 	 	(13.5	) 	 	 	(1.2	) 	 	 	35.7	  	 	 	32.3	  	 	 	(9.5	) 	 	 	7.6	  	
Profit/(loss) for the period	 	 	90.3	  	 	 	90.2	  	 	 	 		 	 	(56.6	) 	 	 	33.6	  	 	 	(62.8	) 	 	 	(47.0	) 	 	 	(4.0	) 	 	 	(111.9	) 	 	 	(90.8	) 	 	 	(23.1	) 	 	 	(24.3	) 	 	 	5.2	  	 	 	6.5	  	
Profit/(loss) for the period from continuing operations	 	 	89.6	  	 	 	90.2	  	 	 	 		 	 	(56.6	) 	 	 	33.6	  	 	 	(62.5	) 	 	 	(46.5	) 	 	 	(4.0	) 	 	 	(111.9	) 	 	 	(90.8	) 	 	 	(23.1	) 	 	 	(24.3	) 	 	 	5.2	  	 	 	6.5	  	
Profit/(loss) for the period attributable to equity holders	 	 	87.9	  	 	 	89.7	  	 	 	 		 	 	(56.6	) 	 	 	33.1	  	 	 	(62.3	) 	 	 	(46.0	) 	 	 	(4.0	) 	 	 	(112.1	) 	 	 	(90.6	) 	 	 	(23.1	) 	 	 	(24.3	) 	 	 	5.2	  	 	 	6.5	  	
Earnings per share—basic and diluted (a)	 	 	n/a	  	 	 	n/a	  	 	 	 		 	 	(28.31	) 	 	 	n/a	  	 	 	n/a	  	 	 	n/a	  	 	 	(2.02	) 	 	 	n/a	  	 	 	n/a	  	 	 	(11.56	) 	 	 	(12.16	) 	 	 	n/a	  	 	 	n/a	  	
Weighted average number of shares outstanding—basic and diluted	 	 	n/a	  	 	 	n/a	  	 	 	 		 	 	2,000,000	  	 	 	n/a	  	 	 	n/a	  	 	 	n/a	  	 	 	2,000,000	  	 	 	n/a	  	 	 	n/a	  	 	 	2,000,000	  	 	 	2,000,000	  	 	 	n/a	  	 	 	n/a	  	
Balance sheet data:	 				 				 	 	 		 				 				 				 				 				 				 				 				 				 				 				
Total assets	 	 	1,224.6	  	 	 	1,263.8	  	 	 	 		 	 	1,961.0	  	 	 	n/a	  	 	 	n/a	  	 	 	n/a	  	 	 	1,842.2	  	 	 	n/a	  	 	 	n/a	  	 	 	n/a	  	 	 	1,824.2	  	 	 	n/a	  	 	 	n/a	  	
Total share capital	 	 	n/a	  	 	 	n/a	  	 	 	 		 	 	2.6	  	 	 	n/a	  	 	 	n/a	  	 	 	n/a	  	 	 	2.6	  	 	 	n/a	  	 	 	n/a	  	 	 	n/a	  	 	 	2.6	  	 	 	n/a	  	 	 	n/a	  	
Invested equity/equity	 	 	631.2	  	 	 	670.1	  	 	 	 		 	 	(32.7	)  	 	 	n/a	  	 	 	n/a	  	 	 	n/a	  	 	 	(134.0	)  	 	 	n/a	  	 	 	n/a	  	 	 	n/a	  	 	 	(163.5	) (b)  	 	 	n/a	  	 	 	n/a	  	
Cash flow data:	 				 				 	 	 		 				 				 				 				 				 				 				 				 				 				 				
Cash provided by/(used in) operating activities	 	 	116.6	  	 	 	163.6	  	 	 	 		 	 	(68.3	) 	 	 	95.3	  	 	 	n/a	  	 	 	n/a	  	 	 	99.6	  	 	 	n/a	  	 	 	n/a	  	 	 	34.2	  	 	 	65.9	  	 	 	n/a	  	 	 	n/a	  	
Cash (used in) investing activities	 	 	(134.6	) 	 	 	(118.7	) 	 	 	 		 	 	(846.1	) 	 	 	(964.8	) 	 	 	n/a	  	 	 	n/a	  	 	 	(123.4	) 	 	 	n/a	  	 	 	n/a	  	 	 	(101.5	) 	 	 	(102.0	) 	 	 	n/a	  	 	 	n/a	  	
Cash provided by/(used in) financing activities	 	 	27.0	  	 	 	(75.0	) 	 	 	 		 	 	1,109.6	  	 	 	1,034.6	  	 	 	n/a	  	 	 	n/a	  	 	 	31.2	  	 	 	n/a	  	 	 	n/a	  	 	 	40.8	  	 	 	1.2	  	 	 	n/a	  	 	 	n/a	  	

(a)	After giving effect to the approximately 2,219.35-for-1 share split that will occur prior to the completion of this offering, the Issuer will have 68,800,000 ordinary shares, basic and diluted, outstanding immediately prior to completion of this offering. Based on this number of ordinary shares, our earnings per share, basic and diluted, would have been (0.82) for the period from December 1 to December 31, 2012, (0.06) for the year ended December 31, 2013, and (0.34) and (0.36) for the six months ended June 30, 2013 and 2014, respectively.	
(b)	Since the Successor was created on December 1, 2012, as of December 31, 2012 and 2013, and as of June 30, 2014, the Atento Group presents negative equity primarily due to the effects of the Acquisition as a result of which equity has been negatively impacted by the costs incurred in connection with the Acquisition and by integration related costs associated with the change in ownership. Equity adjusted for the Reorganization Transaction including the capitalization of the PECs would be $457.2 million as of June 30, 2014. See “Capitalization” and Note 2 to the Interim financial statements included elsewhere in this prospectus.	

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 	 	Predecessor	 	 	  	 	Successor	 	 	Non-IFRS
Aggregated	 	 	 	 	 	 	 	 	Successor	 	 	 	 	 	 	 	 	Successor	 	 	Change
%	 	 	Change
excluding
FX
%	 	
($ in millions)	 	As of and for
the year
ended
December 31,
2011	 	 	Period from
Jan 1 –
Nov 30,
2012	 	 	  	 	Period from
Dec 1 –
Dec 31,
2012	 	 	Year ended
December 31,
2012	 	 	Change
%	 	 	Change
excluding
FX
%	 	 	As of and for
the year
ended
December 31,
2013	 	 	Change
%	 	 	Change
excluding
FX
%	 	 	For the
six
months
ended
June 30,
2013	 	 	For the
six
months
ended
June 30,
2014	 	 			 			
Other financial data (unaudited):	 				 				 	 	 				 				 				 				 				 				 				 				 				 				 				
EBITDA (1)	 	 	234.1	  	 	 	241.9	  	 	 	 	 	(34.9	) 	 	 	207.0	  	 	 	(11.6	) 	 	 	(0.1	) 	 	 	234.0	  	 	 	13.0	  	 	 	22.9	  	 	 	101.7	  	 	 	93.9	  	 	 	(7.7	) 	 	 	3.2	  	
Adjusted EBITDA (1)	 	 	246.9	  	 	 	235.9	  	 	 	 	 	32.2	  	 	 	268.1	  	 	 	8.6	  	 	 	21.5	  	 	 	295.1	  	 	 	10.1	  	 	 	16.9	  	 	 	123.9	  	 	 	131.6	  	 	 	6.2	  	 	 	16.1	  	
Adjusted Earnings / (Loss) (2)	 	 	97.5	  	 	 	86.2	  	 	 	 	 	(8.9	) 	 	 	77.3	  	 	 	n/a	  	 	 	n/a	  	 	 	85.2	  	 	 	n/a	  	 	 	n/a	  	 	 	11.0	  	 	 	24.3	  	 	 	n/a	  	 	 	n/a	  	
Capital expenditures (3)	 	 	(141.6	) 	 	 	(76.9	) 	 	 	 	 	(28.4	) 	 	 	(105.3	) 	 	 	n/a	  	 	 	n/a	  	 	 	(103.0	) 	 	 	n/a	  	 	 	n/a	  	 	 	(28.7	) 	 	 	(40.6	) 	 	 	n/a	  	 	 	n/a	  	
Net debt with third parties (4)	 	 	23.4	  	 	 	5.1	  	 	 	 	 	620.2	  	 	 	620.2	  	 	 	n/a	  	 	 	n/a	  	 	 	637.7	  	 	 	n/a	  	 	 	n/a	  	 	 	n/a	  	 	 	507.6	  	 	 	n/a	  	 	 	n/a	  	

(1)	In considering the financial performance of the business and as a management tool in business decision making, our management analyzes the financial performance measures of EBITDA and Adjusted EBITDA at a company and operating segment level. EBITDA is defined as profit/(loss) for the period from continuing operations before net finance costs, income taxes, and depreciation and amortization. Adjusted EBITDA is defined as EBITDA adjusted to exclude Acquisition and integration related costs, restructuring costs, sponsor management fees, asset impairments, site relocation costs, financing and IPO fees, and other items which are not related to our core results of operations. EBITDA and Adjusted EBITDA are not measures defined by IFRS. The most directly comparable IFRS measure to EBITDA and Adjusted EBITDA is profit/(loss) for the period from continuing operations.	
We believe EBITDA and Adjusted EBITDA, as defined above, are useful metrics for investors to understand our results of operations and profitability because they permit investors to evaluate our recurring profitability from underlying operating activities. We also use these measures internally to establish forecasts, budgets and operational goals to manage and monitor our business, as well as evaluating our underlying historical performance. We believe EBITDA facilitates operating performance comparisons between periods and among other companies in industries similar to ours because it removes the effect of variation in capital structures, taxation, and non-cash depreciation and amortization charges, which may differ between companies for reasons unrelated to operating performance. We believe Adjusted EBITDA better reflects our underlying operating performance because it excludes the impact of items which are not related to our core results of operations.
EBITDA and Adjusted EBITDA measures are frequently used by securities analysts, investors and other interested parties in their evaluation of companies comparable to us, many of which present EBITDA-related performance measures when reporting their results.
EBITDA and Adjusted EBITDA have limitations as analytical tools. These measures are not presentations made in accordance with IFRS, are not measures of financial condition or liquidity and should not be considered in isolation or as alternatives to profit or loss for the period from continuing operations or other measures determined in accordance with IFRS. EBITDA and Adjusted EBITDA are not necessarily comparable to similarly titled measures used by other companies.
See “Selected Historical Financial Information” for a reconciliation of profit/(loss) for the period from continuing operations to EBITDA and Adjusted EBITDA.
 
(2)	In considering our financial performance, our management analyzes the performance measure of Adjusted Earnings/(Loss). Adjusted Earnings/(Loss) is defined as profit/(loss) for the period from continuing operations adjusted for Acquisition and integration related costs, amortization of Acquisition related intangible assets, restructuring costs, sponsor management fees, asset impairments, site relocation costs, financing fees, PECs interest expense, other and tax effects. Adjusted Earnings/(Loss) is not a measure defined by IFRS. The most directly comparable IFRS measure to Adjusted Earnings/(Loss) is our profit/(loss) for the period from continuing operations.	

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We believe Adjusted Earnings/(Loss), as defined above, is useful to investors and is used by our management for measuring profitability because it represents a group measure of performance which excludes the impact of certain non-cash charges and other charges not associated with the underlying operating performance of the business, while including the effect of items that we believe affect shareholder value and in-year return, such as income tax expense and net finance costs.
Management expects to use Adjusted Earnings/(Loss) to (i) provide senior management a monthly report of our operating results that is prepared on an adjusted earnings basis; (ii) prepare strategic plans and annual budgets on an adjusted earnings basis; and (iii) review senior management’s annual compensation, in part, using adjusted performance measures.
Adjusted Earnings/(Loss) is defined to exclude items that are not related to our core results of operations. Adjusted Earnings/(Loss) measures are frequently used by securities analysts, investors and other interested parties in their evaluation of companies comparable to us, many of which present an adjusted earnings related performance measure when reporting their results.
Adjusted Earnings/(Loss) has limitations as an analytical tool. Adjusted Earnings/(Loss) is neither a presentation made in accordance with IFRS nor a measure of financial condition or liquidity, and should not be considered in isolation or as an alternative to profit or loss for the period from continuing operations or other measures determined in accordance with IFRS. Adjusted Earnings/(Loss) is not necessarily comparable to similarly titled measures used by other companies.
See “Selected Historical Financial Information” for a reconciliation of our Adjusted Earnings/(Loss) to our profit/(loss) for the period from continuing operations.
 
(3)	We define capital expenditures as the sum of the additions to property, plant and equipment and intangible assets during the period presented.	
 
(4)	In considering our financial condition, our management analyzes Net debt with third parties, which is defined as Total debt less cash, cash equivalents, short-term financial investments and non-current payables to Atento Group companies (which represent the PECs). The PECs are classified as our subordinated debt relating to our other present and future obligations, and they will be capitalized in connection with this offering. Net debt with third parties is not a measure defined by IFRS.	
Net debt with third parties has limitations as an analytical tool. Net debt with third parties is neither a measure defined by or presented in accordance with IFRS nor a measure of financial performance, and should not be considered in isolation or as an alternative financial measure determined in accordance with IFRS. Net debt with third parties is not necessarily comparable to similarly titled measures used by other companies.
See “Selected Historical Financial Information” for a reconciliation of Total debt to Net debt with third parties utilizing IFRS reported balances obtained from the audited financial statements included elsewhere in this prospectus. Total debt is the most directly comparable financial measure under IFRS for the periods presented.

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 RISK FACTORS
This offering and an investment in our ordinary shares involve a significant degree of risk. You should carefully consider the risks described below, together with the financial and other information contained in this prospectus, before you decide to purchase our ordinary shares. If any of the following risks actually occurs, our business, financial condition, results of operations, cash flow and prospects could be materially and adversely affected. As a result, the trading price of our ordinary shares could decline and you could lose all or part of your investment in our ordinary shares.
Risks Related to Our Business
The CRM BPO market is very competitive.
Our industry is very competitive, and we expect competition to remain intense from a number of sources in the future. In 2013, the top three CRM BPO companies, including us, represented approximately 12% of the global CRM BPO solutions market, based on company filings, IDC and our estimates. We believe that the principal competitive factors in the markets in which we operate are service quality, price, the ability to add value to a client’s business and industry expertise. We face competition primarily from CRM BPO companies and IT services companies. In addition, the trend toward off-shore outsourcing, international expansion by foreign and domestic competitors and continuing technological changes may result in new and different competitors entering our markets. These competitors may include entrants from the communications, software and data networking industries or entrants in geographical locations with lower costs than those in which we operate.
Some of these existing and future competitors may have greater financial, human and other resources, longer operating histories, greater technological expertise and more established relationships in the industries that we currently serve or may serve in the future. In addition, some of our competitors may enter into strategic or commercial relationships among themselves or with larger, more established companies in order to increase their ability to address customer needs and reduce operating costs, or enter into similar arrangements with potential clients. Further, trends of consolidation in our industry and among CRM BPO competitors may result in new competitors with greater scale, a broader footprint, better technologies and price efficiencies attractive to our clients. Increased competition, our inability to compete successfully, pricing pressures or loss of market share could result in reduced operating profit margins which could have a material adverse effect on our business, financial condition, results of operations and prospects.
Telefónica, certain of its affiliates and a few other major clients account for a significant portion of our revenue and any loss of a large portion of business from these clients could have a material adverse effect on our business, financial condition, results of operations and prospects.
We have derived and believe that we will continue to derive a significant portion of our revenue from companies within the Telefónica Group and a few other major client groups. For the years ended December 31, 2011, 2012 and 2013 and for the six months ended June 30, 2014, we generated 51.1%, 50.0%, 48.5% and 46.7%, respectively, of our revenue from the services provided to the Telefónica Group. Our contracts with Telefónica Group companies in Brazil and Spain comprised approximately 66.3% and 67.9%, respectively, of our revenue from the Telefónica Group for the year ended December 31, 2013 and for the six months ended June 30, 2014. Our 15 largest client groups (including the Telefónica Group) on a consolidated basis accounted for a total of 81.4% of our revenue for the six months ended June 30, 2014.
We are party to the MSA with Telefónica for the provision of certain CRM BPO services to Telefónica Group companies which governs the services agreements entered with the Telefónica Group companies. As of June 30, 2014, 38 companies within the Telefónica Group were a party to 162 arm’s-length contracts with us. While our service contracts with the Telefónica Group companies have traditionally been renewed, there can be no assurance that such contracts will be renewed upon their expiration. The MSA expires on December 31, 2021,
 
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and although the MSA is an umbrella agreement which governs our services agreements with the Telefónica Group companies, the termination of the MSA on December 31, 2021 does not automatically result in a termination of any of the local services agreements in force after that date. The MSA contemplates a right of termination prior to December 31, 2021 if a change of control of the Company occurs as a result of a sale to a Telefónica competitor. In addition, there can be no assurance that the MSA will be renewed upon its expiration. Furthermore, the MSA or any other agreement with any of the Telefónica Group companies may be amended in a manner adverse to us or terminated early.
In addition, there can be no assurance that the volume of work to be performed by us for the various Telefónica Group companies will not vary significantly from year to year in the aggregate, particularly since we are not the exclusive outsourcing provider for the Telefónica Group. As a consequence, our revenue or margins from the Telefónica Group may decrease in the future. A number of factors other than the price and quality of our work and the services we provide could result in the loss or reduction of business from Telefónica Group companies, and we cannot predict the timing or occurrence of any such event. For example, a Telefónica Group company may demand price reductions, increased quality standards, change its CRM BPO strategy, or under certain circumstances transfer some or all of the work and services we currently provide to Telefónica in-house.
The loss of a significant part of our revenue derived from these clients, in particular the Telefónica Group, as a result of the occurrence of one or more of the above events would have a material adverse effect on our business, financial condition, results of operations and prospects.
A substantial portion of our revenue, operations and investments are located in Latin America and we are therefore exposed to risks inherent in operating and investing in the region.
For the year ended December 31, 2013, we derived 33.0% of our revenue from Americas and 51.5% from Brazil. We intend to continue to develop and expand our facilities in the Americas and Brazil. Our operations and investments in the Americas and Brazil are subject to various risks related to the economic, political and social conditions of the countries in which we operate, including risks related to the following:
 
 	•	 	inconsistent regulations, licensing and legal requirements may increase our cost of operations as we endeavor to comply with myriad of laws that differ from one country to another in an unpredictable and adverse manner;	
 
 	•	 	currencies may be devalued or may depreciate or currency restrictions or other restraints on transfer of funds may be imposed;	
 
 	•	 	the effects of inflation and currency depreciation and fluctuation may require certain of our subsidiaries to undertake a mandatory recapitalization;	
 
 	•	 	governments may expropriate or nationalize assets or increase their participation in companies;	
 
 	•	 	governments may impose burdensome regulations, taxes or tariffs;	
 
 	•	 	political changes may lead to changes in the business environments in which we operate; and	
 
 	•	 	economic downturns, political instability and civil disturbances may negatively affect our operations.	
Any deterioration in global market and economic conditions, especially in Latin America, and, in particular in the telecommunications and financial services industries from which we generate most of our revenue, may adversely affect our business, financial condition, results of operations and prospects.
Global market and economic conditions, including in Latin America, in the past several years have presented volatility and increasing risk perception, with tighter credit conditions and recession or slow growth in most major economies continuing into 2014. Our results of operations are affected directly by the level of business activity of our clients, which in turn is affected by the level of economic activity in the industries and
 
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markets that they serve. Many of our clients’ industries are especially vulnerable to any crisis in the financial and credit markets or economic downturn. A substantial portion of our clients are concentrated in the telecommunications and financial services industries which were especially vulnerable to the global financial crisis and economic downturn that began in 2008. For the year ended December 31, 2013, 51.7% of our revenue was derived from clients in the telecommunications industry. During the same period, clients in the financial services industry (including insurance) contributed 35.2% to our revenue. Our business and future growth largely depend on continued demand for our services from clients in these industries.
As our business has grown, we have become increasingly exposed to adverse changes in general global economic conditions, which may result in reductions in spending by our clients and their customers. Global economic concerns such as the varying pace of global economic recovery continue to create uncertainty and unpredictability and may have an adverse effect on the cost and availability of credit, leading to decreased spending by businesses. Any deterioration of general economic conditions, or weak economic performance in the economies of the countries in which we operate, in particular in Brazil and Americas where, for the years ended December 31, 2011, 2012 and 2013, 83.6%, 83.7% and 84.5% of our revenue (in each case, before holding company level revenue and consolidation adjustments), respectively, was generated and in our key markets such as the telecommunications and financial services industries where, for the year ended December 31, 2013, 86.9% of our revenue was generated, may have a material adverse effect on our business, financial condition, results of operations and prospects.
Increases in employee benefits expenses as well as changes to labor laws could reduce our profit margin.
Employee benefits expenses accounted for $1,701.9 million in 2011, $1,609.5 million in 2012 and $1,643.5 million in 2013, representing 70.4%, 69.5% and 70.2%, respectively, of our revenue in those periods.
Employee salaries and benefits expenses in many of the countries in which we operate, principally in Latin America, have increased during the periods presented in this prospectus as a result of economic growth, increased demand for CRM BPO services and increased competition for trained employees such as employees at our service delivery centers in Latin America. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Description of Principal Income Statement Items—Total operating expenses.”
We will attempt to control costs associated with salaries and benefits as we continue to add capacity in locations where we consider wage levels of skilled personnel to be satisfactory, but we may not be successful in doing so. We may need to increase salaries more significantly and rapidly than in previous periods in an effort to remain competitive, which may have a material adverse effect on our cash flows, business, financial condition, results of operations, profit margins and prospects. In addition, we may need to increase employee compensation more than in previous periods to remain competitive in attracting the quantity and quality of employees that our business requires. Wage increases or other expenses related to the termination of our employees may reduce our profit margins and have a material adverse effect on our cash flows, business, financial condition, results of operations and prospects. If we expand our operations into new jurisdictions, we may be subject to increased operating costs, including higher employee benefits expenses in these new jurisdictions relative to our current operating costs, which could have a negative effect on our profit margin.
Furthermore, most of the countries in which we operate have labor protection laws, including statutorily mandated minimum annual wage increases, legislation that imposes financial obligations on employers and laws governing the employment of workers. These labor laws in one or more of the key jurisdictions in which we operate, particularly Brazil, may be modified in the future in a way that is detrimental to our business. If these labor laws become more stringent, or if there are continued increases in statutory minimum wages or higher labor costs in these jurisdictions, it may become more difficult for us to discharge employees, or cost-effectively downsize our operations as our level of activity fluctuates, both of which would likely reduce our profit margins and have a material adverse effect on our business, financial condition, results of operations and prospects.
 
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We may fail to attract and retain enough sufficiently trained employees at our service delivery centers to support our operations, which could have a material adverse effect on our business, financial condition, results of operations and prospects.
The CRM BPO industry relies on large numbers of trained employees at service centers, and our success depends to a significant extent on our ability to attract, hire, train and retain employees. The CRM BPO industry, including us, experiences high employee turnover. On average in the six months ended June 30, 2014, we experienced monthly turnover rates of 7.5% of our overall operations personnel (we include both permanent and temporary employees, counting each from his or her first day of employment with us) requiring us to continuously hire and train new employees, particularly in Latin America, where there is significant competition for trained employees with the skills necessary to perform the services we offer to our clients. In addition, we compete for employees, not only with other companies in our industry, but also with companies in other industries and in many locations where we operate there is a limited number of properly trained employees. Increased competition for these employees, in the CRM BPO industry or otherwise, could have an adverse effect on our business. Additionally, a significant increase in the turnover rate among trained employees could increase our costs and decrease our operating profit margins.
In addition, our ability to maintain and renew existing engagements, obtain new business and increase our margins will depend, in large part, on our ability to attract, train and retain employees with skills that enable us to keep pace with growing demands for outsourcing, evolving industry standards, new technology applications and changing client preferences. Our failure to attract, train and retain personnel with the experience and skills necessary to fulfill the needs of our existing and future clients or to assimilate new employees successfully into our operations could have a material adverse effect on our business, financial condition, results of operations and prospects.
Our profitability will suffer if we are not able to maintain our pricing or control or adjust costs to the level of our activity.
Our profit margin, and therefore our profitability, is largely a function of our level of activity and the rates we are able to recover for our services. If we are unable to maintain the pricing for our services or an appropriate seat utilization rate, without corresponding cost reductions, our profitability will suffer. The pricing and levels of activity we are able to achieve are affected by a number of factors, including our clients’ perceptions of our ability to add value through our services, the length of time it takes for volume of new clients to ramp up, competition, introduction of new services or products by us or our competitors, our ability to accurately estimate, attain and sustain revenue from client contracts, margins and cash flows over increasingly longer contract periods and general economic and political conditions.
Our profitability is also a function of our ability to control our costs and improve our efficiency. As we increase the number of our employees and execute our strategies for growth, we may not be able to manage the significantly larger and more geographically diverse workforce that may result, which could adversely affect our ability to control our costs or improve our efficiency. Further, because there is no certainty that our business will grow at the rate that we anticipate, we may incur expenses for the increased capacity for a significant period of time without a corresponding growth in our revenues.
If our clients decide to enter or further expand their own CRM BPO businesses in the future or current trends towards providing CRM BPO services and/or outsourcing activities are reversed, it may materially adversely affect our business, results of operations, financial condition and prospects.
None of our current agreements with our clients prevents them from competing with us in our CRM BPO business and none of our clients have entered into any non-compete agreements with us. Our current clients may seek to provide CRM BPO services similar to those we provide. Some clients conduct CRM BPO services for other parts of their own businesses and for third parties. Any decision by our key clients to enter into or further
 
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expand their CRM BPO business activities in the future could cause us to lose valuable clients and suppliers and may materially adversely affect our business, financial condition, results of operations and prospects.
Moreover, we have based our strategy of future growth on certain assumptions regarding our industry, legal framework, services and future demand in the market for such services. However, the trend to outsource business processes may not continue and could be reversed by factors beyond our control, including negative perceptions attached to outsourcing activities or government regulations against outsourcing activities. Current or prospective clients may elect to perform such services in-house to avoid negative perceptions that may be associated with using an off-shore provider. Political opposition to CRM BPO or outsourcing activities may also arise in certain countries if there is a perception that CRM BPO or outsourcing activities has a negative effect on employment opportunities.
In addition, our business may be adversely affected by potential new laws and regulations prohibiting or limiting outsourcing of certain core business activities of our clients in key jurisdictions in which we conduct our business, such as in Brazil. The introduction of such laws and regulations or the change in interpretation of existing laws and regulations could adversely affect our business, financial condition, results of operations and prospects.
The consolidation of the potential users of CRM BPO services may adversely affect our business, financial condition, results of operations and prospects.
Consolidation of the potential users of CRM BPO services may decrease the number of clients who contract our services. Any significant reduction in or elimination of the use of the services we provide as a result of consolidation would result in reduced net revenue to us and could harm our business. Such consolidation may encourage clients to apply increasing pressure on us to lower the prices we charge for our services, which could have a material adverse effect on our business, financial condition, results of operations and prospects.
Our operating results may fluctuate from one quarter to the next due to various factors including seasonality.
Our operating results may differ significantly from quarter to quarter and our business may be affected by factors such as: client losses, the timing of new contracts and of new product or service offerings, termination of existing contracts, variations in the volume of business from clients resulting from changes in our clients’ operations or the onset of certain parts of the year, such as the summer vacation period in our geographically diverse markets and the year-end holiday season in Latin America, the business decisions of our clients regarding the use of our services, start-up costs, delays or difficulties in expanding our operational facilities and infrastructure, changes to our revenue mix or to our pricing structure or that of our competitors, inaccurate estimates of resources and time required to complete ongoing projects, currency fluctuation and seasonal changes in the operations of our clients.
We typically generate less revenue in the first quarter of the year than in the second quarter as our clients generally spend less after the year-end holiday season. We have also found that our revenue increases in the last quarter of the year, particularly in November and December when our business benefits from the increased activity of our clients and their customers, who generally spend more money and are otherwise more active during the year-end holiday season. These seasonal effects also cause differences in revenue and income among the various quarters of any financial year, which means that the individual quarters of a year should not be directly compared with each other or used to predict annual financial results.
In addition, the sales cycle for our services, typically from six to 12 months (from the date the contract is entered into until the beginning of the provision of services), and the internal budget and approval processes of our prospective clients, make it difficult to predict the timing of new client engagements. Also, we recognize revenue only upon actual provision of the contracted services and when the criteria for recognition are achieved. The financial benefit of gaining a new client may not be realized at the intended time due to delays in the implementation of our services or due to an increase in the start-up costs required in building our infrastructure.
 
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These factors may make it difficult for us to prepare accurate internal financial forecasts or replace anticipated revenue that is not received as a result of these delays.
Our key clients have significant leverage over our business relationships, upon which we are dependent.
We are dependent upon the business relationships we have developed with our clients. Our service contracts generally allow our clients to modify such relationships and our commensurate level of work. Typically, the initial term of our service contracts is one to two years. Generally, our specific service contracts provide for early termination, in some cases without cause, by either party, provided 30 to 90 days prior written notice is given. Clients may also unilaterally reduce the use and number of services under our contracts without penalty. The termination or reduction in services by a substantial percentage or a significant reduction in the price of these contracts could adversely affect our business and reduce our margins. The revenue generated from our fifteen largest client groups (including Telefónica Group companies) for the six months ended June 30, 2014 represented 81.4% of our revenue. Excluding revenue generated from the Telefónica Group, our next 15 largest client groups for the six months ended June 30, 2014 represented in aggregate 35.1% of our revenue. In addition, a contract termination or significant reduction in the services contracted to us by a major client could result in a higher than expected number of unassigned employees, which would increase our employee benefits expenses associated with terminating employees. We may not be able to replace any major client that elects to terminate or not to renew its contract with us, which would have a material adverse effect on our business, financial condition, results of operations and prospects.
We may face difficulties as we expand our operations into countries in which we have no prior operating experience.
We may expand our global footprint in order to maintain an appropriate cost structure and meet our clients’ delivery needs. This may involve expanding into countries other than those in which we currently operate and where we have less familiarity with local procedures. It may involve expanding into less developed countries, which may have less political, social or economic stability and less developed infrastructure and legal systems. As we expand our business into new countries we may encounter economic, regulatory, personnel, technological and other difficulties that increase our expenses or delay our ability to start up our operations or become profitable in such countries. This may affect our relationships with our clients and could have an adverse effect on our business, financial condition, results of operations and prospects.
Our success depends on our key employees.
Our success depends on the continued service and performance of our executive officers and other key personnel in each of our business units, including our structure personnel. There is competition for experienced senior management and personnel with expertise in the CRM BPO industry, and we may not be able to retain our key personnel or recruit skilled personnel with appropriate qualifications and experience. Although we have entered into employment contracts with our executive officers, it may not be possible to require specific performance under a contract for personal services and in any event these agreements do not ensure the continued service of these executive officers. The loss of key members of our personnel, particularly to competitors, could have a material adverse effect on our business, financial condition, results of operations and prospects.
If we experience challenges with respect to labor relations, our overall operating costs and profitability could be adversely affected and our reputation could be harmed.
While we believe we have good relations with our employees, any work disruptions or collective labor actions may have an adverse impact on our services. Approximately 78% of our workforce is under collective bargaining agreements. Collective bargaining agreements are generally renegotiated every one to three years with the principal labor unions in seven of the countries in which we operate. If these labor negotiations are not successful or we otherwise fail to maintain good relations with employees, we could suffer a strike or other significant work stoppage or other form of industrial action, which could have a material adverse effect on our business, financial condition, results of operations and prospects and harm our reputation.
 
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We have a long selling cycle for our CRM BPO services that requires significant funds and management resources, and a long implementation cycle that requires significant resource commitments.
We have a long selling cycle for our CRM BPO services, which requires significant investment of capital, resources and time by both our clients and us. Before committing to use our services, potential clients require us to expend substantial time and resources educating them as to the value of our services and assessing the feasibility of integrating our systems and processes with theirs. Our clients then evaluate our services before deciding whether to use them. Therefore, our selling cycle, which generally ranges from six to 12 months, is subject to many risks and delays over which we have little or no control, including our clients’ decision to choose alternatives to our services (such as other providers or in-house offshore resources) and the timing of our clients’ budget cycles and approval processes.
Implementing our services involves a significant commitment of resources over an extended period of time from both our clients and us. Our clients may also experience delays in obtaining internal approvals or delays associated with technology or system implementations, thereby delaying further the implementation process. Our current and future clients may not be willing or able to invest the time and resources necessary to implement our services, and we may fail to close sales with potential clients to which we have devoted significant time and resources, which could have a material adverse effect on our business, financial condition, results of operations and prospects.
Natural events, wars, terrorist attacks and other acts of violence involving any of the countries in which we or our clients have operations could adversely affect our operations and client confidence.
Natural events (such as floods and earthquakes), terrorist attacks and other acts of violence or war may adversely disrupt our operations, lead to economic weakness in the countries in which they occur and affect worldwide financial markets, and could potentially lead to economic recession, which could have a material adverse effect on our business, financial condition, results of operations and prospects. These events could adversely affect our clients’ levels of business activity and precipitate sudden significant changes in regional and global economic conditions and cycles. These events also pose significant risks to our people and to our business operations around the world.
We may have difficulty controlling our growth and updating our internal operational and financial systems.
Since our founding in 1999, and particularly from 2004, we have experienced rapid growth and significantly expanded our operations in key regions and client industries. Our number of workstations increased from 73,249 as of December 31, 2011, to 75,682 as of December 31, 2012 and 79,197 as of December 31, 2013. As of June 30, 2014, we had 81,625 workstations. The average number of employees (excluding internships) increased from 147,042 for the year ended December 31, 2011 to 150,248 for the year ended December 31, 2012 to 155,832 for the year ended December 31, 2013. For the six months ended June 30, 2014, the average number of employees (excluding internships) was 153,641.
This rapid growth places significant demands on our management and financial and operational resources. In order to manage growth effectively, we must recruit new employees and implement and improve operational systems, procedures and internal controls on a timely basis. In addition, we need to update our existing internal accounting, financial and cost control systems to ensure that we can access all necessary financial information in line with the increasing demands of our business. If we fail to implement these systems, procedures and controls or update these systems on a timely basis, we may not be able to service our clients’ needs, hire and retain new employees, pursue new business, complete future acquisitions or operate our business effectively. Failure to effectively transfer new client business to our delivery centers, properly budget transfer costs, accurately estimate operational costs associated with new contracts or access financial, accounting or cost control information in a timely fashion could result in delays in executing client contracts, trigger service level penalties or cause our profit margins not to meet our expectations. Any inability to control such growth or update our systems could materially adversely affect our business, financial condition, results of operations and prospects.
 
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If we are unable to fund our working capital requirements and new investments, our business, financial condition, results of operations and prospects could be adversely affected.
The CRM BPO industry is characterized by high working capital requirements and the need to make new investments in operating sites and employee resources to meet the requirements of our clients. Similar to our competitors in this industry, we incur significant start-up costs related to investments in infrastructure to provide our services and the hiring and training of employees, such expenses being historically incurred before revenue is generated.
In addition, we are exposed to adverse changes in our main clients’ payment policies, which could have a material adverse impact on our ability to fund our working capital needs. During the years ended December 31, 2011, 2012 and 2013, our average days sales outstanding (“DSO”) was approximately 69 days. If our key clients implement policies which extend the payment terms of our invoices, our working capital levels could be adversely affected and our finance costs may increase. As a result, under the service contracts we entered into since that time, the provisions relating to the time by which Telefónica must satisfy its payment obligations to us was extended. Our working capital was $309.0 million and $385.9 million as of December 31, 2012 and December 31, 2013, respectively. If we are unable to fund our working capital requirements, access financing at competitive prices or make investments to meet the expanding business of our existing and potential new clients, our business, financial condition, results of operations and prospects could be adversely affected.
Fluctuations in, or devaluation of, the local currencies in the countries in which we operate against the U.S. dollar could have a material adverse effect on our business, financial condition, results of operations and prospects.
As of December 31, 2013, 98.0% of our revenue was generated in countries that use currencies other than the U.S. dollar, mostly the local currencies of the Latin American countries in which we operate (particularly, currencies such as the Brazilian real, the Mexican peso, the Chilean peso and the Argentinean peso). Both Brazil and Mexico have experienced inflation and volatility in the past and some Latin American countries have recently been classified as hyperinflationary economies. While inflation may not have a significant effect on the profit and loss of a local subsidiary itself, depreciation of the local currency against the U.S. dollar would reduce the value of the dividends payable to us from our operating companies. We report our financial results in U.S. dollars and our results of operations would be adversely affected if these local currencies depreciate significantly against the U.S. dollar, which may also affect the comparability of our financial results from period to period, as we convert our subsidiaries’ statements of financial position into U.S. dollars from local currencies at the period-end exchange rate, and income and cash flow statements at average exchange rates for the year. Conversely, where we provide off-shore services to U.S. clients and our revenue is earned in U.S. dollars, an appreciation in the currency of the country in which the services are provided could result in an increase in our costs in proportion to the revenue we earn for those services. The exchange rates between these local currencies and the U.S. dollar have changed substantially in recent years and may fluctuate substantially in the future. For the years ended December 31, 2011, 2012 and 2013, these fluctuations had a significant effect on our results of operations. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Factors Affecting Results of Operations—Impact of Foreign Currency Translation.”
In addition, future government action, including interest rate decreases, changes in monetary policy or intervention in the exchange markets and other government action to adjust the value of the local currency may trigger inflationary increases. For example, governmental measures to control inflation may include maintaining a tight monetary policy with high interest rates, thereby restricting the availability of credit and reducing economic growth. As a result, interest rates may fluctuate significantly. Furthermore, losses incurred based on the exchange rate used may be exacerbated if regulatory restrictions are imposed when these currencies are converted into U.S. dollars.
The occurrence of such fluctuations, devaluations or other currency risks could have a material adverse effect on our business, financial condition, results of operations and prospects.
 
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The Brazilian government has exercised, and continues to exercise, significant influence over the Brazilian economy. This involvement, as well as Brazilian political and economic conditions, could adversely impact our business, financial condition, results of operations and prospects.
For the year ended December 31, 2013 and the six months ended June 30, 2014, revenue from our operations in Brazil accounted for 51.5% and 51.9% of our total revenue, respectively, EBITDA accounted for 51.9% and 91.4% of our total EBITDA, respectively, and Adjusted EBITDA accounted for 52.6% and 56.0% of our total Adjusted EBITDA, respectively, (in each case, before holding company level revenue and, expenses and consolidation adjustments).
Historically, the Brazilian government has frequently intervened in the Brazilian economy and occasionally made drastic changes in policy and regulations. The Brazilian government’s actions to control inflation and implement macroeconomic policies have in the past often involved wage and price controls, currency devaluations, capital controls and limits on imports, among other things. Our business, financial condition, results of operations and prospects may be adversely affected by changes in policies or regulations, or by other factors such as:
 
 	•	 	devaluations and other currency fluctuations;	
 
 	•	 	inflation rates;	
 
 	•	 	interest rates;	
 
 	•	 	liquidity of domestic capital and lending markets;	
 
 	•	 	energy shortages;	
 
 	•	 	exchange controls and restrictions on remittances abroad (such as those that were briefly imposed in 1989 and early 1990);	
 
 	•	 	monetary policy;	
 
 	•	 	minimum wage policy;	
 
 	•	 	tax policy; and	
 
 	•	 	other political, diplomatic, social and economic developments in or affecting Brazil.	
In addition, the President of Brazil has considerable power to determine governmental policies and actions that relate to the Brazilian economy and that could consequently affect our business, financial condition and results of operations. We cannot predict what policies may be implemented by the Brazilian federal or state governments and whether these policies will negatively affect our business, financial condition, results of operations and prospects.
The Brazilian government regularly implements changes to tax regimes that may increase our and our clients’ tax burdens. These changes include modifications in the rate of assessments, non-renewal of existing tax relief, such as the Plano Brasil Maior which is expected to expire by the end of 2014 and, on occasion, enactment of temporary taxes the proceeds of which are earmarked for designated governmental purposes. Because we derive a significant portion of our revenues, EBITDA and Adjusted EBITDA from our operations in Brazil, if the Plano Brasil Maior is not extended or not made permanent, it would have a significant negative impact on our total costs. Our inability to pass through such increase in costs to our customers will materially and adversely affect our results of operations. Furthermore, increases in our overall tax burden could negatively affect our overall financial performance and profitability.
The Brazilian currency has been devalued frequently over the past four decades. Throughout this period, the Brazilian government has implemented various economic plans and used various exchange rate policies, including sudden devaluations, periodic mini-devaluations (such as daily adjustments), exchange controls, dual exchange rate markets and a floating exchange rate system. From time to time, there have been significant fluctuations in the exchange rate between the Brazilian currency and the U.S. dollar and other currencies.
 
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In the past, Brazil’s economy has experienced balance of payment deficits and shortages in foreign exchange reserves, and the government has responded by restricting the ability of persons or entities, Brazilian or foreign, to convert Brazilian currency into any foreign currency. The government may institute a restrictive exchange control policy in the future. Any restrictive exchange control policy could prevent or restrict our access to other currencies to meet our financial obligations and our ability to pay dividends out of our Brazilian activities.
Uncertainty over whether possible changes in policies or rules affecting these or other factors may contribute to economic uncertainties in Brazil, which could adversely affect our business, financial condition, results of operation and prospects.
Adverse decisions of the Superior Labor Court or other labor authorities in Brazil with respect to the legality of outsourcing of certain activities that we provide could have a material adverse impact on our business, financial condition, results of operations and prospects.
There is no legislation in Brazil regulating outsourcing activities. The judicial system has been considering this issue in light of the precedent “Súmula No. 331” of Brazil’s Superior Labor Court ( Tribunal Superior do Trabalho ), or “TST,” which prohibits outsourcing of core business activities. TST has been issuing decisions that stipulated that call center activities are core to a telecommunications company’s business and cannot be outsourced. In conflict with this opinion, the Brazilian Telecommunications General Act ( Lei Geral de Telecomunicação ), or the “Act,” explicitly allows the outsourcing of certain activities by telecommunications companies. Several telecommunications companies in Brazil have filed appeals with the Brazilian Federal Supreme Court ( Supremo Tribunal Federal ), or “STF,” arguing that TST decisions are inconsistent with the provisions of the Act. At issue in certain of these cases is also whether the Act is constitutional. Recently, the STF confirmed that it has jurisdiction to consider arguments regarding the legality of service outsourcing in Brazil and, therefore, that it will hear the merit of the claim. The decision of the STF will be a binding precedent that must be adhered to by lower courts, including TST. We cannot predict when any such decision would be issued nor what the final outcome of such cases will be. In addition, there is currently a bill under consideration at the Brazilian Congress to pass a law that would permit and regulate the outsourcing business in Brazil generally. We cannot assure you that such bill will eventually be approved and become law in Brazil or that, if approved, will not be less favorable to our operations.
It is possible that our clients in other industries could be subject to future similar adverse decisions of Brazilian labor courts relating to the interpretation of Súmula 331 and the legality of outsourcing activities. Further adverse decisions of these courts, whether in the telecommunications industry or other industries, with respect to the scope of activities that are permitted to be outsourced, or an adverse decision by the Brazilian Federal Supreme Court in any of the appeals described above, may inhibit or prevent our existing and potential new clients from outsourcing activities. In addition, our service contracts generally require us to indemnify our clients for certain labor-related claims against them by our employees and consequently, future adverse decisions could have a material adverse effect on our business, financial condition, results of operations and prospects.
Argentina has undergone significant political, social and economic instability in the past several years, and if such instability continues or worsens, our Argentine operations could be materially adversely affected.
In 2013 our operations in Argentina accounted for 8.5% of our revenue and 7.6% of our EBITDA (in each case, before holding company level revenue and expenses and consolidation adjustments).
Political and Currency Risk. Over the past several years, the Argentine economy has experienced a severe recession, as well as a political and social crisis, and the abandonment of the U.S. dollar/Argentine peso parity in January 2002 that led to the significant depreciation of the Argentine peso against major international currencies. Depending on the relative impact of other variables affecting our operations, including technological changes,
 
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inflation, gross domestic product (“GDP”) growth, and regulatory changes, continued the depreciation of the Argentine peso may have a negative impact on our Argentine business. For example, in 2013, the Argentine peso depreciated approximately 25% against the U.S. dollar.
Since the abandonment of the U.S. dollar/Argentine peso parity, the Argentine government has implemented measures attempting to address its effects, regain access to financial markets, restore liquidity to the financial system, reduce unemployment and stimulate the economy. Although general political, economic and social conditions in Argentina have improved since 2003, significant uncertainties remain regarding the country’s economic and political future. There have been a number of negative economic and political developments since 2008 that have increased the level of uncertainty. The country has been experiencing high inflation in recent years and there can be no assurance that Argentina will not experience another recession, higher inflation, devaluation, unemployment and social unrest in the future. Argentine government measures concerning the economy, including measures related to inflation, interest rates, foreign exchange controls and currency exchange rates have had and may continue to have a material adverse effect on private sector entities, including our Argentine operations. In addition, the country’s sovereign debt crisis continues to unfold and the outcome thereof, including related litigation between Argentina and certain of its debtholders, remains uncertain.
Restrictions on Transfer of Funds. Under current foreign exchange regulations, there are restrictions on the transfer of funds into and from Argentina. In October 2011, the Argentine government introduced additional restrictions in connection with the transfer of funds. These measures oblige oil, gas and mining companies to repatriate 100% of their foreign currency earnings; insurance companies to sell all their foreign assets and repatriate the proceeds, and require official approval to buy U.S. dollars, which approval is contingent on previous tax declarations proving the necessary income. There can be no assurance that the Argentine government will not impose new restrictions on the transfer of funds from Argentina. Transfers of U.S. dollars out of Argentina are subject to prior government approval and are therefore subject to the political and fiscal situation at the time such transfer request is made. The possibility that the government further restricts, either directly or indirectly, the transfer of dividends from local companies to their foreign shareholders should not be ruled out. If we are unable to repatriate funds from Argentina for whatever reason, we will not be able to use the cash flow from our Argentine operations to finance our operating requirements elsewhere or to satisfy our debt obligations.
In addition, there are restrictions on the transfer of funds into Argentina. Specifically, there are minimum repayment terms and a mandatory one year deposit requirement for funds transferred into Argentina in connection with indebtedness owed to non-Argentine residents, certain portfolio investments made by non-Argentine residents and the repatriation of funds by Argentine residents exceeding $2.0 million per month. Certain transactions are exempt from the mandatory one year deposit requirement, including foreign loans to finance imports and exports, loans to the non-financial sector with an average term of at least two years (including principal and interest payments) if such funds are used exclusively for investments in non-financial assets, direct investments from non-residents and financing obtained to repay foreign financial debt when the proceeds of the loan are used to repay such foreign debt, in compliance with their corporate purpose, by multilateral and bilateral credit institutions and official credit agencies. There can be no assurance that these restrictions will not affect our ability to finance our operations in Argentina.
We may seek to acquire suitable companies in the future and if we cannot find suitable targets or cannot integrate these companies properly into our business after acquiring them, it could have a material adverse effect on our business, results of operations, financial condition and prospects.
While we have grown almost exclusively organically, we may in the future pursue transactions, including acquisitions of complementary businesses, to expand our product offerings and geographic presence as part of our business strategy. These transactions could be material to our financial condition and results of operations. We may not complete future transactions in a timely manner, on a cost-effective basis, or at all, and we may not realize the expected benefits of any acquisition or investments. Other companies may compete with us for these strategic opportunities. We also could experience negative effects on our results of operations and financial
 
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condition from Acquisition related charges, amortization of intangible assets and asset impairment charges, and other issues that could arise in connection with, or as a result of, the acquisition of the acquired company, including regulatory or compliance issues that could exist for an acquired company or business and potential adverse short-term effects on results of operations through increased costs or otherwise. These effects, individually or in the aggregate, could cause a deterioration of our credit profile and result in reduced availability of credit to us or in increased borrowing costs and interest expense in the future. Additionally, the inability to identify suitable acquisition targets or investments or the inability to complete such transactions may affect our competitiveness. Furthermore, we may not be able to integrate effectively such future acquisitions into our operations and may not obtain the profitability we expect from such acquisitions. Any such risks related to future acquisitions could have a material adverse effect on our business, results of operations, financial condition and prospects.
Our ability to provide our services depends in part upon the quality and reliability of the facilities, machinery and equipment provided by our technology and telecommunications providers, our reliance on a limited number of suppliers of such technology and the services and products of our clients.
The success of our business depends in part on our ability to provide high quality and reliable services, which in part depends upon the proper functioning of facilities, machinery and equipment (including appropriate hardware and software and technological applications) provided by third parties and our reliance on a limited number of suppliers of such technology, and is, therefore, beyond our control.
We also depend on the communication services provided by local communication companies in the countries in which we operate, and any significant disruptions in these services would adversely affect our business. If these or other third party providers fail to maintain their equipment properly or fail to provide proper services in a timely or reliable manner our clients may experience service interruptions. If interruptions adversely affect our services or the perceived quality and reliability of our services, we may lose client relationships or be forced to make significant unplanned investments in the purchase of additional equipment from other providers to ensure that we can continue to provide high quality and reliable services to our clients. In addition, if one or more of the limited number of suppliers of our technology could not deliver or provide us with the requisite technology on a timely basis, our clients could suffer further interruptions. Any such interruptions may have a material adverse effect on our business, financial condition, results of operations and prospects.
In addition, in some areas of our business, we depend upon the quality and reliability of the services and products of our clients which we help to sell to their end customers. If the services and products we provide to our clients experience technical difficulties, we may have a harder time selling these services and products to other clients, which may have an adverse effect on our business, financial condition, results of operations and prospects.
Our business depends in part on our capacity to invest in technology as it develops and substantial increases in the costs of technology and telecommunications services which we rely on from third parties could have a material adverse effect on our business, financial condition, results of operations and prospects.
The CRM BPO industry in which we operate is subject to the periodic introduction of new technology which often can enable us to service our clients more efficiently and cost effectively. Our business is partly linked to our ability to recognize these new technological innovations from industry leading providers of such technology and to apply these technological innovations to our business. See “Business—Technology and Operations.” If we do not recognize the importance of a particular new technology to our business in a timely manner or are not committed to investing in and developing such new technology and applying these technologies to our business, our current products and services may be less attractive to existing and new clients, and we may lose market share to competitors who have recognized these trends and invested in such technology. There can be no assurance that we will have sufficient capacity or capital to meet these challenges. Any such
 
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failure to recognize the importance of such technology or a decision not to invest and develop such technology that keeps pace with evolving industry standards and changing client demands could have a material adverse effect on our business, financial condition, results of operations and prospects.
In addition, any increases in the cost of telecommunications services and products provided by third parties, including telecommunications equipment, software, IT products and related IT services and call center workstations have a direct effect on our operating costs. The cost of telecommunications services is subject to a number of factors, including changes in regulations and the telecommunications market as well as competitive factors, for example, the concentration and bargaining power of technology and telecommunications suppliers, most of which are beyond our control or which we cannot predict. The increase in the costs of these essential services and products could have a material adverse effect on our business, financial condition, results of operations and prospects.
If our services do not comply with the quality standards required by our clients or we are in breach of our obligations under our agreements with our clients, our clients may assert claims for reduced payments to us or substantial damages against us, which could have a material adverse effect on our business, financial condition, results of operations and prospects.
Most of our contracts with clients contain service level and performance requirements, including requirements relating to the quality of our services and the timing and quality of responses to the client’s inquiries. In some cases, the quality of services that we provide is measured by quality assurance indicators and surveys which are based in part on the results of direct monitoring by our clients of interactions between our employees and their customers. Failure to consistently meet service requirements of a customer or errors made by our employees in the course of delivering services to customers could disrupt our client’s business and result in a reduction in revenue or a claim for substantial damages against us. For example, some of our agreements stipulate standards of service that, if not met by us, would result in lower payments to us. We also enter into variable pricing arrangements with certain clients and the quality of services provided may be a component of the calculation of the total amounts received from such clients under these arrangements.
In addition, in connection with our service contracts, certain representations may be made, including representations relating to the quality of our services, the ability of our associates and our project management techniques. A failure or inability to meet these requirements or a breach of such representations could seriously damage our reputation and affect our ability to attract new business or result in a claim for damages against us, which could have a material adverse effect on our business, financial condition, results of operations and prospects.
Our business operations are subject to various regulations and the amendment of these regulations or enactment of new regulations could require us to make additional expenditures, restrict our business operations or expose us to significant fines or penalties in the case of non-compliance with such regulations.
Our business operations must be conducted in accordance with a number of sometimes conflicting government regulations, including but not limited to, data protection laws and consumer laws, as well as trade restrictions and sanctions, tariffs, taxation, data privacy and labor relations.
Under data protection laws, we are typically required to manage, utilize and store sensitive or confidential customer data in connection with the services we provide. Under the terms of our client contracts, we represent that we will keep such information strictly confidential. Furthermore, we are subject to local data protection laws, consumer laws and/or “do not call list” regulations in most of the countries in which we operate, all of which may require us to make additional expenditures to ensure compliance with these regulations. We also believe that we will be subject to additional laws and regulations in the future that may be stricter than those currently in force to protect consumers and end users. We seek to implement measures to protect sensitive and confidential
 
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customer data in accordance with client contracts and data protection laws and consumer laws. If any person, including any of our employees, penetrates our network security or otherwise mismanages or misappropriates sensitive or confidential customer data, we could be subject to significant fines for breaching privacy or data protection and consumer laws or lawsuits from our clients or their customers for breaching contractual confidentiality provisions which could result in negative publicity, legal liability, loss of clients and damage to our reputation, each of which could have a material adverse effect on our business, financial condition, results of operations and prospects. Moreover, our insurance coverage for breaches or mismanagement of such data may not be sufficient to cover one or more large claims against us and our insurers may disclaim coverage as to any future claims.
In addition, our business operations may be impacted if current regulations are made stricter or more broadly applied or if new regulations are adopted. Violations of these regulations could impact our reputation and result in financial liability, criminal prosecution, unfavorable publicity, restrictions on our ability to process information and breach of our contractual commitments. Any broadening of current regulations or the introduction of new regulations may require us to make additional expenditures, restrict our business operations or expose us to significant fines or penalties. Any such violations or changes in regulations could, as a result, have a material adverse effect on our business, financial condition, results of operations and prospects.
Damage or disruptions to our key technology systems and facilities either through events beyond or within our control that adversely affect our clients’ businesses, could have a material adverse effect on our business, financial condition, results of operations and prospects.
Our key technology systems and facilities may be damaged in natural disasters such as earthquakes or fires or subject to damage or compromise from human error, technical disruptions, power failure, computer glitches and viruses, telecommunications failures, adverse weather conditions and other unforeseen events, all of which are beyond our control or through bad service or poor performance which are within our control. Such events may cause disruptions to information systems, electrical power and telephone service for sustained periods. Any significant failure, damage or destruction of our equipment or systems, or any major disruptions to basic infrastructure such as power and telecommunications systems in the locations in which we operate, could impede our ability to provide services to our clients and thus adversely affect their businesses, have a negative impact on our reputation and may cause us to incur substantial additional expenses to repair or replace damaged equipment or facilities.
While we currently have property damage insurance in force, our insurance coverage may not be sufficient to guarantee costs of repairing the damage caused from such disruptive events and such events may not be covered under our policies. Prolonged disruption of our services, even if due to events beyond our control could also entitle our clients to terminate their contracts with us, which would have a material adverse effect on our business, financial condition, results of operations and prospects.
Tax matters, new legislation and actions by taxing authorities may have an adverse effect on our operations, effective tax rate and financial condition.
We may not be able to predict our future tax liabilities due to the international nature of our operations, as we are subject to the complex and varying tax laws and rules of several foreign jurisdictions. Our results of operations and financial condition could be adversely affected if tax contingencies are resolved adversely or if we become subject to increased levels of taxation.
We are also subject to income taxes in the United States and numerous other foreign jurisdictions. Our tax expense and cash tax liability in the future could be adversely affected by numerous factors, including, but not limited to, changes in tax laws, regulations, accounting principles or interpretations and the potential adverse outcome of tax examinations and pending tax-related litigation. Changes in the valuation of deferred tax assets and liabilities, which may result from a decline in our profitability or changes in tax rates or legislation, could
 
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have a material adverse effect on our tax expense. The governments of foreign jurisdictions from which we deliver services may assert that certain of our clients have a “permanent establishment” in such foreign jurisdictions by reason of the activities we perform on their behalf, particularly those clients that exercise control over or have substantial dependency on our services. Such an assertion could affect the size and scope of the services requested by such clients in the future.
Transfer pricing regulations to which we are subject require that any transaction among us and our subsidiaries be on arm’s-length terms. If the applicable tax authorities were to determine that the transactions among us and our subsidiaries do not meet arms’ length criteria, we may incur increased tax liability, including accrued interest and penalties. Such increase on our tax expenses would reduce our profitability and cash flows.
Unauthorized disclosure of sensitive or confidential client and customer data, whether through breach of our computer systems or otherwise, could expose us to protracted and costly litigation and cause us to lose clients.
We are typically required to collect and store sensitive data in connection with our services, including names, addresses, social security numbers, credit card account numbers, checking and savings account numbers and payment history records, such as account closures and returned checks. As the complexity of information infrastructure continuous to grow, the potential risk of security breaches and cyber-attacks increases. Such breaches can lead to shutdowns or system interruptions, and potential unauthorized disclosure of sensitive or confidential information. We are also subject to numerous laws and regulations designed to protect this information. Laws and regulations that impact our business are increasing in complexity, change frequently, and at times conflict among the various jurisdictions where we do business.
In addition, many of our service agreements with our clients do not include any limitation on our liability to clients with respect to breaches of our obligation to keep the information we receive confidential. We take precautions to protect confidential client and customer data. However, if any person, including any of our employees, gains unauthorized access or penetrates our network security or otherwise mismanages or misappropriates sensitive data or violates our established data and information security controls, we could be subject to significant liability to our clients or their customers for breaching contractual confidentiality provisions or privacy laws, including legal proceedings, monitory damages, significant remediation costs and regulatory enforcement actions. Penetration of the network security of our data centers could have a negative impact on our reputation, which could have a material adverse effect on our business, results of operations, financial condition and prospects.
Our results of operations could be adversely affected if we are unable to maintain effective internal controls.
Any internal and disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. The design of a control system must consider the benefits of controls relative to their costs. Inherent limitations within a control system include the realities that judgments in decision—making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by individuals acting alone or in collusion with others to override controls. Accordingly, because of the inherent limitations in the design of a cost effective control system, misstatements due to error or fraud may occur and may not always be prevented or timely detected. If we are unable to assert that our internal controls over financial reporting are effective now or in the future, or if our auditors are unable to express an opinion on the effectiveness of our internal controls, we could lose investor confidence in the accuracy and completeness of our financial reports, which could have an adverse effect on our stock price.
We are a party to a number of labor disputes resulting from our operations in Brazil.
As of June 30, 2014, Atento Brasil S.A. (“Atento Brazil”) was party to approximately 9,738 labor disputes initiated by our employees or former employees for various reasons, such as dismissals or disputes over
 
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employment conditions. The estimated amount involved in these claims total $124.1 million of which $75.5 million have been classified as probable, $42.6 million classified as possible and $6.0 million classified as remote, based on inputs from external and internal counsels as well as historical statistics. In connection with such disputes, Atento Brazil and its affiliates have, in accordance with local laws, deposited $49.3 million with the Brazilian courts as security for claims made by employees or former employees (the “Judicial Deposits”). In addition, considering the levels of litigation in Brazil and our historical experience with these types of claims, as of June 30, 2014, we have recognized $75.5 million of provisions ($71.9 million as of December 31, 2013 and $71.8 million as of December 31, 2012). We are also a party to various labor disputes and potential disputes in other jurisdictions in which we operate, including Argentina and Mexico. If our provisions for any of our labor claims are insufficient or the claims against us rise significantly in the future, this could have a material adverse effect on our business, financial condition, results of operations and prospects. See “Business—Legal Proceedings.”
Our existing debt may affect our flexibility in operating and developing our business and our ability to satisfy our obligations.
As of June 30, 2014, we had total indebtedness of $1,366.0 million. Our level of indebtedness may have significant negative effects on our future operations, including:
 
 	•	 	impairing our ability to obtain additional financing in the future (or to obtain such financing on acceptable terms) for working capital, capital expenditures, acquisitions or other important needs;	
 
 	•	 	requiring us to dedicate a substantial portion of our cash flow to the payment of principal and interest on our indebtedness, which could impair our liquidity and reduce the availability of our cash flow to fund working capital, capital expenditures, acquisitions and other important needs;	
 
 	•	 	increasing the possibility of an event of default under the financial and operating covenants contained in our debt instruments; and	
 
 	•	 	limiting our ability to adjust to rapidly changing conditions in the industry, reducing our ability to withstand competitive pressures and making us more vulnerable to a downturn in general economic conditions or business than our competitors with less debt.	
If we are unable to generate sufficient cash flow from operations to service our debt, we may be required to refinance all or a portion of our existing debt or obtain additional financing. We cannot assure you that any such refinancing would be possible or that any additional financing could be obtained. Our inability to obtain such refinancing or financing may have a material adverse effect on our business, financial condition, results of operations and prospects.
During 2013, our cash flow used for debt service totaled $312.8 million, which includes voluntary prepayments of our Brazilian Debentures of $48.8 million, reductions of $200.7 million in principal of our debt outstanding that resulted from refinancing of debt, and interest payments of $63.3 million. Also during 2013, our net cash flows from operating activities totaled $99.6 million, which includes interest paid of $63.3 million. As such, our net cash flows from operating activities (before giving effect to the payment of interest) amounted to $162.9 million. Cash flow used to service our debt represented 192.0% of our net cash flows from operating activities (before giving effect to the payment of interest). Excluding the voluntary prepayments of our Brazilian Debentures and the reduction in principal outstanding mentioned above, cash flow used for debt service would have represented 38.9% of the net cash flows from operating activities (before giving effect to the payment of interest).
For the six months ended June 30, 2014, our cash flow used for debt service totaled $172.3 million, which includes voluntary prepayments of our Brazilian Debentures of $36.0 million, voluntary prepayments of our Vendor Loan Note of $87.9 million, and interest payments of $48.3 million. Also, during the six months ended June 30, 2014, our net cash flows from operating activities totaled $65.9 million, which includes interest paid of $48.3 million. As such, our net cash flows from operating activities (before giving effect to the payment of
 
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interest) amounted to $114.2 million. Cash flow used to service our debt represented 150.9% of our net cash flows from operating activities (before giving effect to the payment of interest). Excluding the voluntary prepayments of our Brazilian Debentures and Vendor Loan Note mentioned above, cash flow used for debt service would have represented 42.3%.
In addition, several of our financing arrangements contain a number of covenants and restrictions including limits on our ability and our subsidiaries’ ability to incur additional debt, pay dividends and make certain investments. Complying with these covenants may cause us to take actions that make it more difficult to successfully execute our business strategy and we may face competition from companies not subject to such restrictions. Moreover, our failure to comply with these covenants could result in an event of default or refusal by our creditors to renew certain of our loans.
Risks Related to Investment in a Luxembourg Company
We are a Luxembourg public limited liability company ( société anonyme ) and it may be difficult for you to obtain or enforce judgments against us or our executive officers and directors in the United States.
We are organized under the laws of the Grand Duchy of Luxembourg. Most of our assets are located outside the United States. Furthermore, some of our directors and officers named in this prospectus reside outside the United States and most of their assets are located outside the United States. As a result, investors may find it difficult to effect service of process within the United States upon us or these persons or to enforce outside the United States judgments obtained against us or these persons in U.S. courts, including judgments in actions predicated upon the civil liability provisions of the U.S. federal securities laws. Likewise, it may also be difficult for an investor to enforce in U.S. courts judgments obtained against us or these persons in courts located in jurisdictions outside the United States, including actions predicated upon the civil liability provisions of the U.S. federal securities laws. It may also be difficult for an investor to bring an original action in a Luxembourg court predicated upon the civil liability provisions of the U.S. federal securities laws against us or these persons. Luxembourg law, furthermore, does not recognize a shareholder’s right to bring a derivative action on behalf of the Company.
As there is no treaty in force on the reciprocal recognition and enforcement of judgments in civil and commercial matters between the United States and the Grand Duchy of Luxembourg, courts in Luxembourg will not automatically recognize and enforce a final judgment rendered by a U.S. court. The enforceability in Luxembourg courts of judgments entered by U.S. courts will depend upon the conditions set forth in the Luxembourg procedural code, which may include the following:
 
 	•	 	the judgment of the U.S. court is enforceable ( exécutoire ) in the United States;	
 
 	•	 	the U.S. court had jurisdiction over the subject matter leading to the judgment (that is, its jurisdiction was in compliance both with Luxembourg private international law rules and with the applicable domestic U.S. federal or state jurisdictional rules);	
 
 	•	 	the U.S. court has applied to the dispute the substantive law designated by the Luxembourg conflict of law rules (although one first instance decision rendered in Luxembourg—which had not been appealed—no longer applies this condition);	
 
 	•	 	the judgment was granted following proceedings where the counterparty had the opportunity to appear, and if appeared, there was no violation of the rights of the defendant;	
 
 	•	 	the U.S. court has acted in accordance with its own procedural rules; and	
 
 	•	 	the judgment of the U.S. court does not contravene Luxembourg international public policy.	
Our directors and officers, past and present, are entitled to indemnification from us to the fullest extent permitted by Luxembourg law against liability and all expenses reasonably incurred or paid by him in connection with any losses or liabilities, claim, action, suit or proceeding in which he is involved by virtue of his being or having been a director or officer and against amounts paid or incurred by him in the settlement thereof, subject to
 
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limited exceptions. To the extent allowed by law, the rights and obligations among us and any of our current or former directors and officers will be governed exclusively by the laws of Luxembourg and subject to the jurisdiction of the Luxembourg courts, unless such rights or obligations do not relate to or arise out of their capacities as directors or officers. Although there is doubt as to whether U.S. courts would enforce such a provision in an action brought in the United States under U.S. securities laws, such provision could make enforcing judgments obtained outside Luxembourg more difficult to enforce against our assets in Luxembourg or in jurisdictions that would apply Luxembourg law.
Our shareholders may have more difficulty protecting their interests than they would as shareholders of a U.S. corporation.
Our corporate affairs are governed by our articles of association and by the laws governing public limited liability companies organized under the laws of the Grand Duchy of Luxembourg. The rights of our shareholders and the responsibilities of our directors and officers under Luxembourg law are different from those applicable to a corporation incorporated in the United States. Luxembourg law and regulations in respect of corporate governance matters might not be as protective of minority shareholders as state corporation laws in the United States. Therefore, our shareholders may have more difficulty in protecting their interests in connection with actions taken by our directors and officers or our principal shareholders than they would as shareholders of a corporation incorporated in the United States. See “Comparison of Shareholder Rights” for a discussion of differences between Luxembourg and Delaware corporate law.
You may not be able to participate in equity offerings, and you may not receive any value for rights that we may grant.
Pursuant to Luxembourg law on commercial companies, dated August 10, 1915, as amended (the “Luxembourg Corporate Law”), existing shareholders are generally entitled to pre-emptive subscription rights in the event of capital increases and issues of shares against cash contributions. However, prior to the completion of this offering, our articles of association will provide that pre-emptive subscription rights can be limited, waived or cancelled by our board of directors for a period ending on the fifth anniversary of the date of publication of the notarial deed recording the minutes of the extraordinary general shareholders’ meeting in the Luxembourg Legal Gazette approving an increase of the share capital by the board of directors within the limits of the authorized share capital, which publication is expected to occur prior to completion of this offering. The general meeting of our shareholders may renew, expand or amend such authorization. “Description of Share Capital—Pre-Emptive Rights.”
Luxembourg insolvency laws may offer our shareholders less protection than they would have under U.S. insolvency laws.
As a company organized under the laws of the Grand Duchy of Luxembourg and with our registered office in Luxembourg, we are subject to Luxembourg insolvency laws in the event any insolvency proceedings are initiated against us including, amount other things, Council Regulation (EC) No. 1346/2000 of May 29, 2000 on insolvency proceedings. Should courts in another European country determine that the insolvency laws of that country apply to us in accordance with and subject to such EU regulations, the courts in that country could have jurisdiction over the insolvency proceedings initiated against us. Insolvency laws in Luxembourg or the relevant other European country, if any, may offer our shareholders less protection than they would have under U.S. insolvency laws and make it more difficult for them to recover the amount they could expect to recover in a liquidation under U.S. insolvency laws.
Risks Related to Our Ordinary Shares and this Offering
Control by Bain Capital could adversely affect our other shareholders.
When this offering is completed, Bain Capital will control Topco and Topco, will, through its ownership of PikCo, own, directly or indirectly, approximately 78.3% of our ordinary shares, assuming no exercise of the
 
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underwriters’ option to purchase additional ordinary shares in this offering. As a result, Bain Capital will have a continuing ability to control our board of directors and to exercise significant influence over our affairs for the foreseeable future, including controlling the election of directors and significant corporate transactions, such as a merger or other sale of our Company or our assets.
In addition, because we are a foreign private issuer, we will not be subject to the independence requirements of the New York Stock Exchange that require that our board of directors be comprised of a majority of independent directors, that we have a compensation committee comprised solely of independent directors and that we have a nominating and governance committee comprised solely of independent directors.
This concentrated control by Bain Capital will limit the ability of other shareholders to influence corporate matters and, as a result, we may take actions that our other shareholders do not view as beneficial. For example, this concentration of ownership could have the effect of delaying or preventing a change in control or otherwise discouraging a potential acquirer from attempting to obtain control of us, which in turn could cause the market price of our ordinary shares to decline or prevent our shareholders from realizing a premium over the market price for their ordinary shares.
As a foreign private issuer, we are permitted to, and we will, rely on exemptions from certain corporate governance standards applicable to U.S. issuers, including the requirement that a majority of an issuer’s directors consist of independent directors. This may afford less protection to holders of our ordinary shares.
The New York Stock Exchange listing rules requires listed companies to have, among other things, a majority of their board members be independent, and to have independent director oversight of executive compensation, nomination of directors and corporate governance matters. As a foreign private issuer, however, while we intend to comply with these requirements within the permitted phase-in periods, we are permitted to follow home country practice in lieu of the above requirements. Luxembourg law, the law of our home country, does not require that a majority of our board consist of independent directors or the implementation of a nominating and corporate governance committee, and our board may thus in the future not include, or include fewer, independent directors than would be required if we were subject to the New York Stock Exchange listing rules, or they may decide that it is in our interest not to have a compensation committee or nominating and corporate governance committee, or have such committees governed by practices that would not comply with New York Stock Exchange listing rules. Since a majority of our board of directors may not consist of independent directors if we decide to rely on the foreign private issuer exemption to the New York Stock Exchange listing rules, our board’s approach may, therefore, be different from that of a board with a majority of independent directors, and as a result, the management oversight of our Company could, in the future, be more limited than if we were subject to the New York Stock Exchange listing rules.
Moreover, we are not required to file periodic reports and financial statements with the SEC as frequently or as promptly as companies that are not foreign private issuers whose securities are registered under the Exchange Act. In addition, we are not required to comply with Regulation FD, which restricts the selective disclosure of material information. As a result, our shareholders may not have access to information they deem important, which may result in our shares being less attractive to investors.
We may be classified as a passive foreign investment company, which could result in adverse U.S. federal income tax consequences to U.S. Holders of our ordinary shares.
Based on the anticipated market price of our ordinary shares in this offering and expected price of our ordinary shares following this offering, and the composition of our income, assets and operations, we do not expect to be treated as a passive foreign investment company (“PFIC”) for U.S. federal income tax purposes for the current taxable year or in the foreseeable future. However, the application of the PFIC rules is subject to uncertainty in several respects, and we cannot assure you the U.S. Internal Revenue Service will not take a
 
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contrary position. Furthermore, this is a factual determination that must be made annually after the close of each taxable year. If we are a PFIC for any taxable year during which a U.S. Holder (as defined in “Material Tax Considerations—Material United States Federal Income Tax Considerations”) holds our ordinary shares, certain adverse U.S. federal income tax consequences could apply to such U.S. Holder. See “Material Tax Considerations—Material United States Federal Income Tax Considerations—Potential Application of Passive Foreign Investment Company Provisions.”
There has been no prior public market for our ordinary shares, and an active trading market may not develop or be sustained.
Prior to this offering, there has been no public market for our ordinary shares. We cannot predict the extent to which a trading market for our ordinary shares will develop or how liquid that market might become. An active trading market for our ordinary shares may never develop or may not be sustained, which could adversely affect your ability to sell your ordinary shares and the market price of your ordinary shares. Also, if you purchase ordinary shares in this offering, you will pay a price that was not established in public trading markets. The initial public offering price for the ordinary shares will be determined by negotiations between us, the selling shareholder and the underwriters and does not purport to be indicative of prices at which our ordinary shares will trade upon completion of this offering. Consequently, you may not be able to sell your ordinary shares above the initial public offering price and may suffer a loss on your investment.
The market price of our ordinary shares may be volatile and may trade at prices below the initial public offering price.
The stock market in general, and the market for equities of newly-public companies in particular, have been highly volatile. As a result, the market price of our ordinary shares is likely to be similarly volatile, and investors in our ordinary shares may experience a decrease, which could be substantial, in the value of their ordinary shares, including decreases unrelated to our operating performance or prospects, or a complete loss of their investment. The price of our ordinary shares could be subject to wide fluctuations in response to a number of factors, including those listed elsewhere in this “Risk Factors” section and others such as:
 
 	•	 	variations in our operating performance and the performance of our competitors;	
 
 	•	 	actual or anticipated fluctuations in our quarterly or annual operating results;	
 
 	•	 	changes in our revenues or earnings estimates or recommendations by securities analysts;	
 
 	•	 	publication of research reports by securities analysts about us or our competitors or our industry;	
 
 	•	 	our failure or the failure of our competitors to meet analysts’ projections or guidance that we or our competitors may give to the market;	
 
 	•	 	additions or departures of key personnel;	
 
 	•	 	strategic decisions by us or our competitors, such as acquisitions, divestitures, spin-offs, joint ventures, strategic investments or changes in business strategy;	
 
 	•	 	announcement of technological innovations by us or our competitors;	
 
 	•	 	the passage of legislation, changes in interpretations of laws or other regulatory events or developments affecting us;	
 
 	•	 	speculation in the press or investment community;	
 
 	•	 	changes in accounting principles;	
 
 	•	 	terrorist acts, acts of war or periods of widespread civil unrest;	
 
 	•	 	changes in general market and economic conditions;	
 
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 	•	 	changes or trends in our industry;	
 
 	•	 	investors’ perception of our prospects; and	
 
 	•	 	adverse resolution of any new or pending litigation against us.	
In the past, securities class action litigation has often been initiated against companies following periods of volatility in their stock price. This type of litigation could result in substantial costs and divert our management’s attention and resources, and could also require us to make substantial payments to satisfy judgments or to settle or defend litigation.
A total of 58.2 million or 79.9% of our total outstanding ordinary shares after the offering are restricted from immediate resale, but may be sold on a stock exchange in the near future. The large number of ordinary shares eligible for public sale or subject to rights requiring us to register them for public sale could depress the market price of our ordinary shares.
The market price of our ordinary shares could decline as a result of sales of a large number of our ordinary shares in the market after this offering, and the perception that these sales could occur may also depress the market price of our ordinary shares. We will have 72.8 million ordinary shares outstanding after this offering. Of these shares, 14.6 million ordinary shares sold in this offering will be freely tradable in the United States, except for any ordinary shares purchased by our “affiliates” as defined in Rule 144 under the Securities Act.
PikCo, our primary shareholder as of September 3, 2014, after giving effect to the Reorganization Transaction, has agreed with the underwriters, subject to a number of exceptions, not to dispose of or hedge any of their ordinary shares during the 180-day period beginning on the date of this prospectus, except with the prior written consent of the representatives of the underwriters in this offering. After the expiration of the 180-day restricted period, these ordinary shares may be sold in the public market in the United States, subject to prior registration in the United States, if required, or reliance upon an exemption from U.S. registration, including, in the case of ordinary shares held by affiliates, compliance with the volume restrictions of Rule 144. See “Shares Eligible for Future Sale.”
Upon completion of this offering, PikCo will be entitled, under contracts providing for registration rights, to require us to register our ordinary shares owned by them with the SEC. Upon effectiveness of any registration statement, subject to lock-up agreements with the representatives of the underwriters, those ordinary shares will be available for immediate resale in the United States in the open market.
Sales of our ordinary shares as restrictions expire or pursuant to registration rights may make it more difficult for us to sell equity securities in the future at a time and at a price that we deem appropriate. These sales, or the perception that such sales could occur, also could cause the market price for our ordinary shares to fall and make it more difficult for you to sell our ordinary shares.
Purchasers in this offering will immediately experience substantial dilution in net tangible book value of their ordinary shares.
The initial public offering price of our ordinary shares in this offering is considerably higher than the net tangible book value per ordinary share. Purchasers in this offering will suffer immediate dilution of $21.14 per ordinary share of pro forma net tangible book value, based on the sale of ordinary shares to be sold in this offering at an assumed initial public offering price of $20.50 per ordinary share (the mid-point of the price range set forth on the cover of this prospectus). See “Dilution.”
 
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After the completion of this offering, we may not pay any dividends. Accordingly, investors may only realize future gains on their investments if the price of their ordinary shares increases, which may never occur.
Though we currently intend to pay dividends after the completion of this offering, any such determination to pay dividends will be at the discretion of our board of directors. The payment of cash distributions on ordinary shares is restricted under the terms of our Senior Secured Notes, Brazilian Debentures, the Vendor Loan Note and our CVIs. In addition, because we are a holding company, our ability to make any distributions on ordinary shares may be limited by restrictions on our ability to obtain sufficient funds from subsidiaries, including restrictions under the terms of our Senior Secured Notes, Brazilian Debentures, the Vendor Loan Note and our CVIs. Furthermore, under the laws of Luxembourg, we are able to make distributions only to the extent that we have profits available and distributable reserves. Accordingly, investors may only realize future gains on their investments if the price of their ordinary shares increases, which may never occur. See “Dividend Policy.”
If securities or industry analysts do not publish research or reports about our business, if they adversely change their recommendations regarding our ordinary shares or if our operating results do not meet their expectations, the price of our ordinary shares could decline.
The market price of our ordinary shares will be influenced by the research and reports that industry or securities analysts publish about us or our business. If one or more of these analysts cease coverage of our Company or fail to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause the market price of our ordinary shares or its trading volume to decline. Moreover, if one or more of the analysts who cover our Company downgrade our ordinary shares or if our operating results or prospects do not meet their expectations, the market price of our ordinary shares could decline.
Future equity issuances may dilute the holdings of ordinary shareholders and could materially affect the market price of our ordinary shares.
We may in the future decide to offer additional equity to raise capital or for other purposes. Any such additional offering could reduce the proportionate ownership and voting interests of holders of our ordinary shares, as well as our earnings per ordinary share and net asset value per ordinary share. Future sales of substantial amounts of our ordinary shares in the public market, whether by us or by our existing shareholders, or the perception that sales could occur, may adversely affect the market price of our shares, which could decline significantly.
We will incur increased costs as a result of becoming a public company.
As a public company, we will incur significant legal, accounting, insurance and other expenses that we have not incurred as a private company, including costs associated with public company reporting requirements. We also have incurred and will incur costs associated with the Sarbanes-Oxley Act of 2002 and the Dodd Frank Wall Street Reform and Consumer Protection Act and related rules implemented by the SEC and the New York Stock Exchange. The expenses incurred by public companies generally for reporting and corporate governance purposes have been increasing in recent years. We expect that compliance with these rules and regulations will increase our legal and financial compliance costs and make some activities more time-consuming and costly, although we are currently unable to estimate these costs with any degree of certainty. These laws and regulations could also make it more difficult or costly for us to obtain certain types of insurance, including director and officer liability insurance, and we may be forced to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. These laws and regulations could also make it more difficult for us to attract and retain qualified persons to serve on our board of directors, our board committees or as our executive officers. Furthermore, if we are unable to satisfy our obligations as a public company, we could be subject to delisting of our ordinary shares, fines, sanctions and other regulatory action and potentially civil litigation.
 
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Compliance with Section 404 of the Sarbanes-Oxley Act of 2002 will require significant expenditures and effort by management, and if our independent registered public accounting firm is unable to provide an unqualified attestation report on our internal controls, the market price of our ordinary shares could be adversely affected.
Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002 and related rules and regulations and beginning with our Annual Report on Form 20-F for the year ending December 31, 2015, our management will be required to report on, and our independent registered public accounting firm to attest to, the effectiveness of our internal controls over financial reporting. The rules governing the standards that must be met for management to assess our internal controls over financial reporting are complex and require significant documentation, testing and possible remediation. We are currently in the process of reviewing, documenting and testing our internal controls over financial reporting. We may encounter problems or delays in completing the implementation of any changes necessary to make a favorable assessment of our internal controls over financial reporting.
If securities or industry analysts do not publish research or reports about our business, if they adversely change their recommendations regarding our shares or if our operating results do not meet their expectations, the price of our shares could decline.
The market price of our ordinary shares will be influenced by the research and reports that industry or securities analysts publish about us or our business. If one or more of these analysts cease coverage of our company or fail to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause the market price of our shares or its trading volume to decline. Moreover, if one or more of the analysts who cover our company downgrade our shares or if our operating results or prospects do not meet their expectations, the market price of our shares could decline.
 
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 FORWARD-LOOKING STATEMENTS
This prospectus contains forward-looking statements that are subject to risks and uncertainties. All statements other than statements of historical fact included in this prospectus are forward-looking statements. Forward-looking statements give our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as “anticipate,” “estimate,” “expect,” “project,” “plan,” “intend,” “believe,” “may,” “will,” “should,” “can have,” “likely” and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events. For example, all statements we make relating to our estimated and projected costs, expenditures, cash flows, growth rates and financial results, our plans and objectives for future operations, growth or initiatives, or strategies or the expected outcome or impact of pending or threatened litigation are forward-looking statements. All forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those that we expected, including but not limited to:
 
 	•	 	the competitiveness of the CRM BPO market;	
 
 	•	 	the loss of one or more of our major clients, a small number of which account for a significant portion of our revenue, in particular Telefónica;	
 
 	•	 	risks associated with operating in Latin America, where a significant proportion of our revenue is derived and where a large number of our employees are based;	
 
 	•	 	our clients deciding to enter or further expand their own CRM BPO businesses in the future;	
 
 	•	 	any deterioration in global markets and general economic conditions, in particular in Latin America and in the telecommunications and the financial services industries from which we derive most of our revenue;	
 
 	•	 	increases in employee benefits expenses, changes to labor laws and labor relations;	
 
 	•	 	failure to attract and retain enough sufficiently trained employees at our service delivery centers to support our operations;	
 
 	•	 	inability to maintain our pricing and level of activity and control our costs;	
 
 	•	 	consolidation of potential users of CRM BPO services;	
 
 	•	 	the reversal of current trends towards CRM BPO solutions;	
 
 	•	 	fluctuations of our operating results from one quarter to the next due to various factors including seasonality;	
 
 	•	 	the significant leverage our clients have over our business relationships;	
 
 	•	 	the departure of key personnel or challenges with respect to labor relations;	
 
 	•	 	the long selling and implementation cycle for CRM BPO services;	
 
 	•	 	difficulty controlling our growth and updating our internal operational and financial systems as a result of our increased size;	
 
 	•	 	an inability to fund our working capital requirements and new investments;	
 
 	•	 	fluctuations in, or devaluation of, the local currencies in the countries in which we operate against our reporting currency, the euro;	
 
 	•	 	current political and economic volatility, particularly in Brazil, Mexico, Argentina and Europe;	
 
 	•	 	our ability to acquire and integrate companies that complement our business;	
 
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 	•	 	the quality and reliability of the technology provided by our technology and telecommunications providers, our reliance on a limited number of suppliers of such technology and the services and products of our clients;	
 
 	•	 	our ability to invest in and implement new technologies;	
 
 	•	 	disruptions or interruptions in our client relationships;	
 
 	•	 	actions of the Brazilian, EU, Spanish, Argentinian, Mexican and other governments and their respective regulatory agencies, including adverse competition law rulings and the introduction of new regulations that could require us to make additional expenditures;	
 
 	•	 	damage or disruptions to our key technology systems or the quality and reliability of the technology provided by technology telecommunications providers;	
 
 	•	 	an increase in the cost of telecommunications services and other services on which we and our industry rely;	
 
 	•	 	an actual or perceived failure to comply with data protection regulations, in particular any actual or perceived failure to ensure secure transmission of sensitive or confidential customer data through our networks;	
 
 	•	 	the effect of labor disputes on our business; and	
 
 	•	 	other risk factors listed in the section of this prospectus entitled “Risk Factors.”	
We derive many of our forward-looking statements from our operating budgets and forecasts, which are based upon many detailed assumptions. While we believe that our assumptions are reasonable, we caution that it is very difficult to predict the impact of known factors, and, it is impossible for us to anticipate all factors that could affect our actual results. Important factors that could cause actual results to differ materially from our expectations, or cautionary statements, are disclosed under “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this prospectus. All written and oral forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by these cautionary statements as well as other cautionary statements that are made from time to time in our other SEC filings and public communications. You should evaluate all forward-looking statements made in this prospectus in the context of these risks and uncertainties.
We caution you that the important factors referenced above may not contain all of the factors that are important to you. In addition, we cannot assure you that we will realize the results or developments we expect or anticipate or, even if substantially realized, that they will result in the consequences or affect us or our operations in the way we expect. The forward-looking statements included in this prospectus are made only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law.
 
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 USE OF PROCEEDS
We estimate based upon an assumed initial public offering price of $20.50 per ordinary share (the midpoint of the price range set forth on the cover page of this prospectus) that we will receive net proceeds from this offering, after deducting underwriting discounts and commissions (including commissions payable in respect of the sale of ordinary shares by the selling shareholder, estimated at $11.9 million, or $14.4 million if the underwriters exercise their option to purchase 2,193,750 additional ordinary shares from the selling shareholder) and estimated offering expenses (including fees payable to Bain Capital Partners, LLC) payable by us, of approximately $30.5 million (or $28.0 million if the underwriters exercise their option to purchase additional ordinary shares from the selling shareholder). We will not receive any proceeds from the sale of our ordinary shares by the selling shareholder, including any ordinary shares sold by the selling shareholder in connection with the exercise of the underwriters’ option to purchase additional ordinary shares.
We intend to use the net proceeds to us from the sale of ordinary shares in this offering, together with cash on hand, to repay the entire $31.4 million (at the exchange rate prevailing as of June 30, 2014) outstanding amount due under our Vendor Loan Note as of June 30, 2014 and to pay fees and expenses incurred in connection with this offering. We will use any remaining net proceeds from this offering for general corporate purposes. We expect that the selling shareholder will use $108 million of the net proceeds received by it in this offering to repay a portion of its outstanding PIK Notes due 2020. See “Certain Relationships and Related Party Transactions—PIK Notes due 2020.”
A $1.00 increase or decrease in the assumed initial public offering price of $20.50 per ordinary share (the midpoint of the price range set forth on the cover page of this prospectus) would increase or decrease the net proceeds we receive from this offering by approximately $3.2 million, assuming the number of ordinary shares offered by us, as set forth on the cover page of this prospectus, remains the same.
 
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 DIVIDEND POLICY
Although we expect to be well capitalized following the Reorganization Transaction prior to the completion of this offering and we have sufficient liquidity, our ability to pay dividends on our ordinary shares is limited in the near-term by the indenture governing our Senior Secured Notes, the Brazilian Debentures, the Vendor Loan Note and our CVIs, and may be further restricted by the terms of any of our future debt or preferred securities. In addition, under Luxembourg law, at least 5% of our net profits per year must be allocated to the creation of a legal reserve until such reserve has reached an amount equal to 10% of our issued share capital. If the legal reserve subsequently falls below the 10% threshold, 5% of net profits again must be allocated toward the reserve until such reserve returns to the 10% threshold. If the legal reserve exceeds 10% of our issued share capital, the legal reserve may be reduced. The legal reserve is not available for distribution. Additionally, because we are a holding company, our ability to pay dividends on our ordinary shares is limited by restrictions on the ability of our subsidiaries to pay dividends or make distributions to us, including restrictions under the terms of the agreements governing our indebtedness. See “Description of Certain Indebtedness.”
Pursuant to our articles of incorporation, our board of directors has the power to distribute interim dividends in accordance with applicable Luxembourg law. The amount to be distributed by the board of directors may not exceed the total profits made since the end of the last financial year for which the accounts have been approved, plus any profits carried forward and sums drawn from reserves available for this purpose, less losses carried forward and any sums to be placed to reserve pursuant to the requirements of Luxembourg law or of our articles of incorporation. Notwithstanding the foregoing, dividends may also be declared by a simple majority vote of our shareholders at an annual general shareholders meeting, typically but not necessarily, based on the recommendation of our board of directors. All shares of our capital stock grant pari passu rights with respect to the payment of dividends. Any future determination to pay dividends will be subject to compliance with covenants in current and future agreements governing our indebtedness, and will depend upon our results of operations, financial condition, capital requirements and other factors that our board of directors deems relevant.
 
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 CAPITALIZATION
The following table sets forth our cash and cash equivalents and our capitalization as of June 30, 2014, on:
 
 	•	 	an actual basis;	
 
 	•	 	an actual basis, as adjusted to give effect to the Reorganization Transaction prior to the completion of this offering; and	
 
 	•	 	a pro forma as adjusted basis to give effect to this offering and the use of proceeds hereof.	
You should read the following table in conjunction with the sections entitled “Use of Proceeds,” “Selected Historical Financial Information,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” the Predecessor financial statements and the Successor financial statements included elsewhere in this prospectus.

 	  	As of June 30, 2014	 	
 	  	Actual	 	 	As
Adjusted (1)	 	  	Pro
Forma (2)	 	
($ in millions)	  	 	 	 	 	 	  	 	 	
Cash and cash equivalents	  	$	178.2	  	 	$	178.2	  	  	$	178.2	  	
Short term financial investments	  	 	59.5	  	 	 	59.5	  	  	 	59.5	  	
Debt:	  				 				  				
7.375% Senior Secured Notes due 2020 (3)	  	 	299.6	  	 	 	299.6	  	  	 	299.6	  	
Brazilian Debentures (4)	  	 	330.6	  	 	 	330.6	  	  	 	330.6	  	
Vendor Loan Note (5)	  	 	31.4	  	 	 	31.4	  	  	 	—	(9)  	
Contingent Value Instruments (6)	  	 	36.4	  	 	 	36.4	  	  	 	36.4	  	
Revolving Credit Facility (7)	  	 	—	  	 	 	—	  	  	 	—	  	
Preferred Equity Certificates	  	 	620.7	  	 	 	—	  	  	 	—	  	
Finance lease payables	  	 	9.9	  	 	 	9.9	  	  	 	9.9	  	
Other borrowings	  	 	37.4	  	 	 	37.4	  	  	 	37.4	  	
Total debt (8)	  	 	1,366.0	  	 	 	745.3	  	  	 	713.9	  	
Total equity	  	 	(163.5	) 	 	 	457.2	  	  	 	488.6	  	
Total capitalization	  	$	1,202.5	  	 	$	1,202.5	  	  	$	1,202.5	  	

(1)	This column represents the total capitalization as adjusted to give effect to the Reorganization Transaction, which will occur prior to the completion of this offering. See “Prospectus Summary—Our History and Corporate Structure—The Reorganization Transaction.”	
(2)	A $1.00 increase or decrease in the assumed initial public offering price of $20.50 per ordinary share, the midpoint of the price range set forth on the cover page of this prospectus, would increase or decrease the net proceeds from this offering available to us and correspondingly increase or decrease the amount of additional paid-in capital, total equity and total capitalization by approximately $3.2 million, assuming the number of ordinary shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. See “Use of Proceeds.”	
(3)	Represents the principal amount of $300 million minus $9.7 million of capitalized transaction costs plus $9.3 million of accrued interest. It does not include the fair value of derivative financial liabilities related to the Senior Secured Notes, which was $19.5 million as of June 30, 2014.	
(4)	Represents the principal amount of BRL 915 million minus net capitalized transaction costs of BRL 11.0 million, minus early prepayments of BRL 177.4 million, plus accrued interest of BRL 1.6 million, which results in an outstanding amount of BRL 728.2 million as of June 30, 2014, at an exchange rate of BRL 2.2025 to $1.00. As of September 3, 2014, the exchange rate was BRL 2.23 to $1.00.	
(5)	Represents the €110.0 million outstanding aggregate principal amount of the Vendor Loan Note, minus early prepayments of €61.6 million, a non-cash reduction of €25.4 million, plus accrued interest of	
 
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 	€0.1 million, which results in an outstanding amount of €23.0 million as of June 30, 2014 at the exchange rate of €0.7322 to $1.00. As of September 3, 2014, the exchange rate was €0.76 to $1.00.	
(6)	Represents the fair value registered amount of ARS 666.8 million of the CVIs, at the exchange rate of ARS 8.1538 to $1.00. As of September 3, 2014, the exchange rate was ARS 8.41 to $1.00.	
(7)	As of June 30, 2014, we had no amounts outstanding on the Revolving Credit Facility.	
(8)	Total debt includes $47.3 million of current borrowings ($36.8 million of debt due to BNDES, $0.6 million of other bank borrowings and $9.9 million of finance lease payables).	
(9)	The expected principal balance (including accrued interest) due in respect of the Vendor Loan Note is approximately $30.5 million due to depreciation of the euro versus the U.S. dollar since June 30, 2014 to September 3, 2014.	
 
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 DILUTION
Our net tangible book value as of June 30, 2014, before giving effect to the sale by us of 4,049,558 ordinary shares offered in this offering, was approximately $(78) million, or approximately $(1.13) per ordinary share. Net tangible book value per share represents the amount of our total tangible assets less the amount of our total liabilities, divided by the number of ordinary shares outstanding at September 3, 2014, after giving effect to the approximately 2,219.35-for-1 share split in connection with this offering prior to the sale by us of 4,049,558 ordinary shares offered in this offering. Dilution in net tangible book value per ordinary share represents the difference between the amount per ordinary share paid by investors in this offering and the pro forma net tangible book value per ordinary share outstanding immediately after this offering.
After giving effect to the sale of 4,049,558 ordinary shares by us in this offering, based upon an assumed initial public offering price of $20.50 per ordinary share (the midpoint of the price range set forth on the cover page of this prospectus) after deducting underwriting discounts and commissions and estimated expenses payable by us in connection with this offering, our pro forma net tangible book value as of June 30, 2014 would have been approximately $(46) million, or $(0.64) per ordinary share. This represents an immediate increase in net tangible book value of $0.49 per ordinary share, to existing shareholders and immediate dilution of $21.14 per ordinary share to new investors purchasing ordinary shares in this offering at the assumed initial public offering price.
The following table illustrates this dilution in net tangible book value per ordinary share to new investors:

Assumed initial public offering price per ordinary share	  	$	20.50	  	
Net tangible book value per ordinary share as of June 30, 2014	  	$	(1.13	) 	
Increase in pro forma net tangible book value per ordinary share attributable to this offering	  	$	0.49	  	
Pro forma net tangible book value per ordinary share as of June 30, 2014 (after giving effect to this offering)	  	$	(0.64	) 	
Dilution per ordinary share to new investors (1)	  	$	21.14	  	

(1)	Dilution is determined by subtracting pro forma net tangible book value per ordinary share after giving effect to this offering from the assumed initial public offering price paid by a new investor. The per share figures in this Dilution section are based upon the outstanding ordinary shares of the Issuer, as described herein, and the financial information of Midco. See “Presentation of Financial Information—Reorganization Transaction.”	
Each $1.00 increase (decrease) in the assumed initial public offering price of $20.50 per ordinary share, the midpoint of the price range set forth on the cover page of this prospectus, would increase (decrease) our pro forma net tangible book value by $3.2 million, or $0.04 per ordinary share, and the dilution in net tangible book value per share to investors in this offering by $0.96 per ordinary share, assuming, in each case, that the number of ordinary shares offered by us and the selling shareholder, as set forth on the cover page of this prospectus, remain the same. See also, “Use of Proceeds.” The as adjusted information is illustrative only and, following the completion of this offering, will be adjusted based on the actual initial public offering price and other terms of this offering determined at pricing.
 
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The following table summarizes, as of September 3, 2014, after giving effect to the 2,219.35-to-1 share split, on a pro forma basis, the number of ordinary shares purchased from us, the aggregate cash consideration paid to us and the average price per ordinary share paid to us by existing shareholders and to be paid by new investors purchasing ordinary shares issued by us in this offering. The table assumes an initial public offering price of $20.50 per ordinary share, the midpoint of the price range set forth on the cover page of this prospectus, before deducting underwriting discounts and commissions and estimated offering expenses payable by us in connection with this offering:

 	  	Shares Purchased	 	 	Total Consideration	 	 	Average Price
Per Share	 	
 	  	Number	 	  	Percentage	 	 	Amount	 	  	Percentage	 	 			
Existing shareholders	  	 	68,800,000	  	  	 	94	% 	 	$	472,157,340	  	  	 	85	% 	 	$	6.86	  	
New investors	  	 	4,049,558	  	  	 	6	% 	 	$	83,015,939	  	  	 	15	% 	 	$	20.50	  	
Total	  	 	72,849,558	  	  	 	100	% 	 	$	555,173,279	  	  	 	100	% 	 	$	7.62	  	
A $1.00 increase (decrease) in the assumed initial public offering price of $20.50 per ordinary share would increase (decrease) the total consideration paid by investors participating in this offering by $4.0 million, or increase (decrease) the percent of total consideration paid by investors participating in this offering by 5%, assuming that the number of ordinary shares offered by us, as set forth on the cover of this prospectus, remains the same and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.
Except as otherwise indicated, the presentation in the table directly above assumes no exercise of any outstanding options and no sale of 10,575,442 ordinary shares by the selling shareholder. The sale of 10,575,442 ordinary shares to be sold by the selling shareholder in this offering will reduce the number of shares held by existing shareholders to 58,224,558, or 80% of the total shares outstanding, and will increase the number of shares held by investors participating in this offering to 14,625,000, or 20% of the total shares expected to be outstanding following this offering. In addition, if the underwriters’ option to purchase additional shares from the selling shareholder is exercised in full, the number of ordinary shares held by existing shareholders will be further reduced to 56,030,808, or 77% of the total number of ordinary shares to be outstanding upon the closing of this offering, and the number of ordinary shares held by investors participating in this offering will be further increased to 16,818,750 ordinary shares or 23% of the total number of ordinary shares to be outstanding upon the closing of this offering.
 
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 SELECTED HISTORICAL FINANCIAL INFORMATION
The following selected financial information should be read in conjunction with the section of this prospectus entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the financial statements included elsewhere in this prospectus.
Historically, we conducted our business through the Predecessor through November 30, 2012, and subsequent to the Acquisition, through the Successor, and therefore our historical financial statements present the results of operations of Predecessor and Successor, respectively. Prior to completion of this offering we will implement the Reorganization Transaction pursuant to which the Successor will become a wholly-owned subsidiary of the Issuer, a newly-formed public limited liability holding company incorporated under the laws of Luxembourg with nominal assets and liabilities for the purpose of facilitating the offering contemplated hereby, and which will not have conducted any operations prior to the completion of this offering. Following the Reorganization Transaction and this offering, our financial statements will present the results of operations of the Issuer. The consolidated financial statements of the Issuer will be substantially the same as the consolidated financial statements of the Successor prior to this offering, as adjusted for the Reorganization Transaction. Upon consummation, the Reorganization Transaction will be reflected retroactively in the Issuer’s earnings per share calculations. See “Prospectus Summary—Our History and Corporate Structure—The Reorganization Transaction.”
The following table sets forth selected historical financial data of the Atento Group. We prepare our financial statements in accordance with IFRS as issued by the IASB. As a result of the Acquisition, we applied acquisition accounting whereby the purchase price paid was allocated to the acquired assets and assumed liabilities at fair value. Our financial reporting periods presented in the table below are as follows:
 
 	•	 	Solely for purposes of the selected historical financial information in this section, the Predecessor period refers to the years ended December 31, 2009, 2010 and 2011 and the period from January 1, 2012 through November 30, 2012 and reflects the combined carve-out results of operations of the Predecessor.	
 
 	•	 	The Successor period reflects the consolidated results of operations of the Successor, which includes the effects of acquisition accounting for the one-month period from December 1, 2012 to December 31, 2012, for the year ended December 31, 2013 and for the six months ended June 30, 2013 and 2014.	
The selected combined carve-out historical financial information as of and for the years ended December 31, 2009 and 2010, which has been prepared in accordance with IFRS as issued by the IASB, is derived from the unaudited accounting records of the Predecessor and is not included in the financial statements that are included elsewhere in this prospectus.
The selected combined carve-out historical financial information as of and for the year ended December 31, 2011, as of November 30, 2012 and for the period from January 1, 2012 to November 30, 2012 presented below were derived from the Predecessor financial statements included elsewhere in this prospectus.
The selected consolidated historical financial information as of December 31, 2012 and for the one-month period from December 1, 2012 to December 31, 2012 and as of and for the year ended December 31, 2013 presented below were derived from the Successor financial statements included elsewhere in this prospectus.
The selected consolidated historical financial information as of June 30, 2014 and for the six-months ended June 30, 2014 and 2013 presented below were derived from the Interim financial statements included elsewhere in this prospectus.
Historical results for any prior period are not necessarily indicative of results expected in any future period.
 
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The unaudited Aggregated 2012 Financial Information set forth below is derived by adding together the corresponding data from the audited Predecessor financial statements for the period from January 1, 2012 to November 30, 2012, to the corresponding data from the audited Successor financial statements for the one-month period from December 1, 2012 to December 31, 2012, appearing elsewhere in this prospectus, each prepared under IFRS as issued by the IASB. This presentation of the Aggregated 2012 Financial Information is for illustrative purposes only, is not presented in accordance with IFRS, and is not necessarily comparable to previous or subsequent periods, or indicative of results expected in any future period (including as a result of the effects of the Acquisition).

 	 	Predecessor	 	 	  	 	 	 	Successor	 	 	Non-IFRS
Aggregated	 	 	Successor	 	
($ in millions
other than share
and
per share data)	 	As of and for the year ended
December 31,	 	 	As of and
for the
period
from Jan 1 –
Nov 30,
2012	 	 	  	 	 	 	As of and
for the
period
from Dec 1 –
Dec 31,
2012	 	 	For the
year ended
December 31,
2012	 	 	As of and
for the
year ended
December 31,
2013	 	 	For the six
months
ended
June 30,
2013	 	 	As of and
for the six
months
ended
June 30,
2014	 	
	 	2009	 	 	2010	 	 	2011	 	 			 	  	 	 	 			 			 			 			 			
 	 	(unaudited)	 	 	(unaudited)	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	(unaudited)	 	 	 	 	 	(unaudited)	 	 	(unaudited)	 	
Income statement data:	 				 				 				 				 	 	 		 				 				 				 				 				
Revenue	 	 	1,731.6	  	 	 	2,128.8	  	 	 	2,417.3	  	 	 	2,125.9	  	 	 	 		 	 	190.9	  	 	 	2,316.8	  	 	 	2,341.1	  	 	 	1,167.1	  	 	 	1,153.6	  	
Operating profit / (loss)	 	 	155.9	  	 	 	183.4	  	 	 	155.6	  	 	 	163.8	  	 	 	 		 	 	(42.4	) 	 	 	121.4	  	 	 	105.0	  	 	 	35.7	  	 	 	32.3	  	
Profit / (loss) for the period	 	 	95.9	  	 	 	112.2	  	 	 	90.3	  	 	 	90.2	  	 	 	 		 	 	(56.6	) 	 	 	33.6	  	 	 	(4.0	) 	 	 	(23.1	) 	 	 	(24.3	) 	
Profit / (loss) for the period from continuing operations	 	 	95.9	  	 	 	112.2	  	 	 	89.6	  	 	 	90.2	  	 	 	 		 	 	(56.6	) 	 	 	33.6	  	 	 	(4.0	) 	 	 	(23.1	) 	 	 	(24.3	) 	
Profit / (loss) attributable to equity holders	 	 	95.9	  	 	 	111.1	  	 	 	87.9	  	 	 	89.7	  	 	 	 		 	 	(56.6	) 	 	 	33.1	  	 	 	(4.0	) 	 	 	(23.1	) 	 	 	(24.3	) 	
Earnings per share—basic and diluted	 	 	n/a	  	 	 	n/a	  	 	 	n/a	  	 	 	n/a	  	 	 	 		 	 	(28.31	) 	 	 	n/a	  	 	 	(2.02	) 	 	 	(11.56	) 	 	 	(12.16	) 	
Weighted average number of shares outstanding—basic and diluted	 	 	n/a	  	 	 	n/a	  	 	 	n/a	  	 	 	n/a	  	 	 	 		 	 	2,000,000	  	 	 	n/a	  	 	 	2,000,000	  	 	 	2,000,000	  	 	 	2,000,000	  	
Balance sheet data:	 				 				 				 				 	 	 		 				 				 				 				 				
Total assets	 	 	969.4	  	 	 	1,152.6	  	 	 	1,224.6	  	 	 	1,263.8	  	 	 	 		 	 	1,961.0	  	 	 	n/a	  	 	 	1,842.2	  	 	 	n/a	  	 	 	1,824.2	  	
Total share capital	 	 	n/a	  	 	 	n/a	  	 	 	n/a	  	 	 	n/a	  	 	 	 		 	 	2.6	  	 	 	n/a	  	 	 	2.6	  	 	 	n/a	  	 	 	2.6	  	
Invested equity/equity	 	 	517.6	  	 	 	658.2	  	 	 	631.2	  	 	 	670.1	  	 	 	 		 	 	(32.7	) 	 	 	n/a	  	 	 	(134.0	) 	 	 	n/a	  	 	 	(163.5	) (a)  	

(a)	Since the Successor was created on December 1, 2012, as of December 31, 2012 and 2013, and as of June 30, 2014 the Atento Group presents negative equity primarily due to the effects of the Acquisition as a result of which equity has been negatively impacted by the costs incurred in connection with the Acquisition and by integration related costs associated with the change in ownership. Equity adjusted for the Reorganization Transaction, including the capitalization of the PECs, would be $457.2 million as of June 30, 2014. See “Capitalization” and Note 2 to the Interim financial statements included elsewhere in this prospectus.	
 
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 	 	Predecessor	 	 	  	 	 	 	Successor	 	 	Non-IFRS
Aggregated	 	 	Successor	 	
($ in millions)	 	As of and for
the year ended
December 31,
2011	 	 	Period from
Jan 1 –
Nov 30,
2012	 	 	  	 	 	 	Period from
Dec 1 –
Dec 31,
2012	 	 	Year ended
December 31,
2012	 	 	As of and for
the year ended
December 31,
2013	 	 	Six months
ended
June 30,
2013	 	 	Six months
ended
June 30,
2014	 	
	 			 			 		 		 			 			 			 			 			
Other financial data (unaudited):	 				 				 	 	 		 				 				 				 				 				
EBITDA (1)	 	 	234.1	  	 	 	241.9	  	 	 	 		 	 	(34.9	) 	 	 	207.0	  	 	 	234.0	  	 	 	101.7	  	 	 	93.9	  	
Adjusted EBITDA (1)	 	 	246.9	  	 	 	235.9	  	 	 	 		 	 	32.2	  	 	 	268.1	  	 	 	295.1	  	 	 	123.9	  	 	 	131.6	  	
Adjusted earnings/(loss) (2)	 	 	97.5	  	 	 	86.2	  	 	 	 		 	 	(8.9	) 	 	 	77.3	  	 	 	85.2	  	 	 	11.0	  	 	 	24.3	  	
Capital expenditures (3)	 	 	(141.6	) 	 	 	(76.9	) 	 	 	 		 	 	(28.4	) 	 	 	(105.3	) 	 	 	(103.0	) 	 	 	(28.7	) 	 	 	(40.6	) 	
Net debt with third parties (4)	 	 	23.4	  	 	 	5.1	  	 	 	 		 	 	620.2	  	 	 	620.2	  	 	 	637.7	  	 	 	n/a	  	 	 	507.6	  	
Cash flow data:	 				 				 	 	 		 				 				 				 				 				
Cash provided by/(used in) operating activities	 	 	116.6	  	 	 	163.6	  	 	 	 		 	 	(68.3	) 	 	 	95.3	  	 	 	99.6	  	 	 	34.2	  	 	 	65.9	  	
Cash (used in) investing activities	 	 	(134.6	) 	 	 	(118.7	) 	 	 	 		 	 	(846.1	) 	 	 	(964.8	) 	 	 	(123.4	) 	 	 	(101.5	) 	 	 	(102.0	) 	
Cash provided by/(used in) financing activities	 	 	27.0	  	 	 	(75.0	) 	 	 	 		 	 	1,109.6	  	 	 	1,034.6	  	 	 	31.2	  	 	 	40.8	  	 	 	1.2	  	

(1)	In considering the financial performance of the business and as a management tool in business decision making, our management analyzes the financial performance measures of EBITDA and Adjusted EBITDA at a company and operating segment level. EBITDA is defined as profit/(loss) for the period from continuing operations before net finance costs, income taxes, and depreciation and amortization. Adjusted EBITDA is defined as EBITDA adjusted to exclude Acquisition and integration related costs, restructuring costs, sponsor management fees, asset impairments, site relocation costs, financing and IPO fees and other items which are not related to our core results of operations. EBITDA and Adjusted EBITDA are not measures defined by IFRS. The most directly comparable IFRS measure to EBITDA and Adjusted EBITDA is profit/(loss) for the period from continuing operations.	
We believe EBITDA and Adjusted EBITDA, as defined above, are useful metrics for investors to understand our results of operations and profitability because they permit investors to evaluate our recurring profitability from underlying operating activities. We also use these measures internally to establish forecasts, budgets and operational goals to manage and monitor our business, as well as evaluating our underlying historical performance. We believe EBITDA facilitates operating performance comparisons between periods and among other companies in industries similar to ours because it removes the effect of variation in capital structures, taxation, and non-cash depreciation and amortization charges, which may differ between companies for reasons unrelated to operating performance. We believe Adjusted EBITDA better reflects our underlying operating performance because it excludes the impact of items that are not related to our core results of operations.
EBITDA and Adjusted EBITDA measures are frequently used by securities analysts, investors and other interested parties in their evaluation of companies comparable to us, many of which present EBITDA-related performance measures when reporting their results.
EBITDA and Adjusted EBITDA have limitations as analytical tools. These measures are not presentations made in accordance with IFRS, are not measures of financial condition or liquidity and should not be considered in isolation or as alternatives to profit or loss for the period from continuing operations or other measures determined in accordance with IFRS. EBITDA and Adjusted EBITDA are not necessarily comparable to similarly titled measures used by other companies.
 
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The following table reconciles our EBITDA and Adjusted EBITDA to profit/(loss) for the period from continuing operations:

 	 	Predecessor	 	 	  	 	 	 	Successor	 	 	Non-IFRS
Aggregated	 	 	Successor	 	
 	 	Year
ended
December 31,
2011	 	 	Period
from
Jan 1 – Nov 30,
2012	 	 	  	 	 	 	Period
from
Dec 1 – Dec 31,
2012	 	 	Year
ended
December 31,
2012	 	 	Year
ended
December 31,
2013	 	 	Six months
ended
June 30,
2013	 	 	Six months
ended
June 30,
2014	 	
($ in millions)	 			 			 	  	 	 	 			 			 			 			 			
 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	(unaudited)	 	 	 	 	 	(unaudited)	 	 	(unaudited)	 	
Profit/(loss) for the period from continuing operations	 	 	89.6	  	 	 	90.2	  	 	 	 		 	 	(56.6	) 	 	 	33.6	  	 	 	(4.0	) 	 	 	(23.1	) 	 	 	(24.3	)	
Net finance expense	 	 	11.1	  	 	 	12.9	  	 	 	 		 	 	6.0	  	 	 	19.0	  	 	 	100.7	  	 	 	60.9	  	 	 	67.1	  	
Income tax expense	 	 	54.9	  	 	 	60.7	  	 	 	 		 	 	8.1	  	 	 	68.8	  	 	 	8.3	  	 	 	(2.1	) 	 	 	(10.5	) 	
Depreciation and amortization	 	 	78.5	  	 	 	78.1	  	 	 	 		 	 	7.5	  	 	 	85.6	  	 	 	129.0	  	 	 	66.0	  	 	 	61.6	  	
EBITDA (non-GAAP) (unaudited)	 	 	234.1	  	 	 	241.9	  	 	 	 		 	 	(34.9	) 	 	 	207.0	  	 	 	234.0	  	 	 	101.7	  	 	 	93.9	  	
Acquisition and integration related costs (a)	 	 	—	  	 	 	0.2	  	 	 	 		 	 	62.4	  	 	 	62.6	  	 	 	29.3	  	 	 	12.8	  	 	 	5.4	  	
Restructuring costs (b)	 	 	8.0	  	 	 	3.9	  	 	 	 		 	 	4.7	  	 	 	8.6	  	 	 	12.8	  	 	 	1.6	  	 	 	21.6	  	
Sponsor management fees (c)	 	 	—	  	 	 	—	  	 	 	 		 	 	—	  	 	 	—	  	 	 	9.1	  	 	 	3.5	  	 	 	4.8	  	
Asset impairments (d)	 	 	8.6	  	 	 	—	  	 	 	 		 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	32.9	  	
Site relocation costs (e)	 	 	—	  	 	 	1.7	  	 	 	 		 	 	0.7	  	 	 	2.4	  	 	 	1.8	  	 	 	0.3	  	 	 	1.0	  	
Financing and IPO fees (f)	 	 	—	  	 	 	—	  	 	 	 		 	 	—	  	 	 	—	  	 	 	6.1	  	 	 	3.1	  	 	 	7.6	  	
Other (g)	 	 	(3.8	) 	 	 	(11.8	) 	 	 	 		 	 	(0.6	) 	 	 	(12.4	) 	 	 	2.0	  	 	 	0.9	  	 	 	(35.5	) 	
Adjusted EBITDA (non-GAAP) (unaudited)	 	 	246.9	  	 	 	235.9	  	 	 	 		 	 	32.2	  	 	 	268.1	  	 	 	295.1	  	 	 	123.9	  	 	 	131.6	  	

 	(a)	 	Acquisition and integration related costs incurred in 2012, 2013 and the six months ended June 30, 2014 primarily include costs associated with the Acquisition. Nearly all of the $62.6 million in expenses in 2012 directly related to Acquisition and integration related costs (banking, advisory, legal fees, etc.). In 2013, of the $29.3 million in expenses, $27.9 million related to professional fees incurred to establish Atento as a standalone company not affiliated with Telefónica. These projects mainly relate to the improvement of financial and cash flow reporting ($5.9 million), full strategy review including growth implementation plan and operational set-up with a leading consulting firm ($14.7 million), improving the efficiency in procurement ($4.8 million) and headhunting fees related primarily to strengthening the senior management team post-Acquisition ($1.4 million). Acquisition and integration related costs incurred for the six months ended June 30, 2014 primarily resulted from consulting fees incurred in connection with the full strategy review including our growth implementation plan and operational set-up with a leading consulting firm. We expect these projects to be completed by the end of 2014.	
 	(b)	 	Restructuring costs incurred in 2011, 2012 and 2013 primarily include a number of restructuring activities and other personnel costs that were not related to our core results of operations. Restructuring costs in 2011 primarily relate to costs incurred in connection with the termination of certain members of our executive committee. Restructuring costs in 2012 primarily represent costs incurred in Chile related to the implementation of the new service delivery model with Telefónica which impacted the profile of certain operations personnel and other restructuring costs for certain changes to the executive team in EMEA and Americas. In 2013, $8.6 million of our restructuring costs were related to the relocation of corporate headquarters and severance payments directly related to the Acquisition. In	
 
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 	addition, in 2013, we incurred restructuring costs in Spain of $1.5 million (relating to restructuring expenses incurred as a consequence of significant reduction in activity levels as a result of adverse market conditions in Spain) and in Chile of $1.4 million (relating to restructuring expenses incurred in connection with the implementation of a new service delivery model with Telefónica). Restructuring costs incurred for the six months ended June 30, 2014 primarily relate to the headcount reduction plan in Spain which will take into consideration a maximum number of terminations amounting to 9% of the total headcount of Atento Teleservicios España S.A.U. We expect to substantially complete the headcount reduction plan by the fourth quarter of 2014.	
 	(c)	 	Sponsor management fees represent the annual advisory fee paid to Bain Capital Partners, LLC that are expensed during the periods presented. These fees are expected to cease following the offering. See “Certain Relationships and Related Party Transactions—Bain Capital Consulting Services Agreement and Transaction Services Agreement.”	
 	(d)	 	Asset impairment incurred in 2011 is the impairment of the Caribú Project, an intangible asset acquired in 2009 from Telefónica, which represents the right to be the exclusive supplier of customer analysis for 12 Telefónica subsidiaries in Latin America. Asset impairment incurred for the six months ended June 30, 2014 relate to the goodwill and other intangible asset impairment relating to the Czech Republic of $3.8 million and Spain of $29.1 million. The impairment was, in part, a result of the amendment of the MSA with Telefónica by which the minimum revenue commitment for Spain was reduced against a $34.9 million penalty fee (see note (g) below) compensated by Telefónica.	
 	(e)	 	Site relocation costs incurred in 2012 and 2013 primarily include costs associated with our current strategic initiative of relocating call centers from tier 1 cities to tier 2 cities in Brazil. See “Prospectus Summary—Our Strategy—Best-in-Class Operations—Competitive Site Footprint.”	
 	(f)	 	Financing fees primarily relate to professional fees incurred in 2013 in connection with the issuance of the Senior Secured Notes, the proceeds of which were used to finance a portion of the cost of the Acquisition and to pay financial advisory fees. Financing and IPO fees for the six months ended June 30, 2014 primarily relate to non-core professional fees incurred by us during the initial public offering process. We expect these IPO costs to be completed upon completion of this offering.	
 	(g)	 	Other includes expense accruals, reversal of expense accruals or income accruals which are not related to our core results of operations. In 2011, the other amount primarily relates to the gain from the sale of the BNH site in Brazil, amounting to $3.6 million. In 2012, the other amount primarily relates to a release of an employee benefit accrual of $11.3 million following the better-than-expected outcome of the collective bargain agreement negotiation in Spain. In 2013, the other amount primarily related to various other consulting expenses, the largest component of which was a $0.5 million charge related to projects for inventory control in Brazil. Other, during the six months ended June 30, 2014, primarily relates to the gain from the $34.9 million penalty fee compensated by Telefónica under the terms of the amended MSA.	
 
(2)	In considering our financial performance, our management analyzes the performance measure of Adjusted Earnings/(Loss). Adjusted Earnings/(Loss) is defined as profit/(loss) for the period from continuing operations adjusted for Acquisition and integration related costs, amortization of Acquisition related intangible assets, restructuring costs, sponsor management fees, assets impairments, site relocation costs, financing fees, PECs interest expense, other and tax effects. Adjusted Earnings/(Loss) is not a measure defined by IFRS. The most directly comparable IFRS measure to Adjusted Earnings/(Loss) is our profit/(loss) for the period from continuing operations.	
We believe Adjusted Earnings/(Loss), as defined above, is useful to investors and is used by our management to measure profitability because it represents a group measure of performance which excludes the impact of certain non-cash charges and other charges not associated with the underlying operating performance of the business, while including the effect of items that we believe affect shareholder value and in-year return, such as income tax expense and net finance costs.
 
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Management expects to use Adjusted Earnings/(Loss) to (i) provide senior management a monthly report of our operating results that is prepared on an adjusted earnings basis; (ii) prepare strategic plans and annual budgets on an adjusted earnings basis; and (iii) review senior management’s annual compensation, in part, using adjusted performance measures.
Adjusted Earnings/(Loss) is defined to exclude items which are not related to our core results of operations. Adjusted Earnings/(Loss) measures are frequently used by securities analysts, investors and other interested parties in their evaluation of companies comparable to us, many of which present an adjusted earnings related performance measure when reporting their results.
Adjusted Earnings/(Loss) has limitations as an analytical tool. Adjusted Earnings/(Loss) is neither a presentation made in accordance with IFRS nor a measure of financial condition or liquidity and should not be considered in isolation or as an alternative to profit or loss for the period from continuing operations or other measures determined in accordance with IFRS. Adjusted Earnings/(Loss) is not necessarily comparable to similarly titled measures used by other companies.
The following table reconciles our Adjusted Earnings/(Loss) to our profit/(loss) for the period from continuing operations:

 	 	Predecessor	 	 	 	 	 	 	Successor	 	 	Non-IFRS
Aggregated	 	 	Successor	 	 	Successor	 	
 	 	Year ended
December 31,
2011	 	 	Period from
Jan 1 – Nov 30,
2012	 	 	 	 	 	 	Period from
Dec 1 – Dec 31,
2012	 	 	Year ended
December 31,
2012	 	 	Year ended
December 31,
2013	 	 	Six months
ended
June 30,
2013	 	 	Six months
ended
June 30,
2014	 	
($ in millions)	 			 			 	  	 	 	 			 			 			 			 			
 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	(unaudited)	 	 	 	 	 	(unaudited)	 	 	(unaudited)	 	
Profit / (Loss) for the period from continuing operations	 	 	89.6	  	 	 	90.2	  	 	 	 		 	 	(56.6	) 	 	 	33.6	  	 	 	(4.0	) 	 	 	(23.1	) 	 	 	(24.3	) 	
Acquisition and integration related costs (a)	 	 	—	  	 	 	0.2	  	 	 	 		 	 	62.4	  	 	 	62.6	  	 	 	29.3	  	 	 	12.8	  	 	 	5.4	  	
Amortization of Acquisition related intangible assets (b)	 	 	—	  	 	 	—	  	 	 	 		 	 	—	  	 	 	—	  	 	 	40.7	  	 	 	21.0	  	 	 	19.5	  	
Restructuring costs (c)	 	 	8.0	  	 	 	3.9	  	 	 	 		 	 	4.7	  	 	 	8.6	  	 	 	12.8	  	 	 	1.6	  	 	 	21.6	  	
Sponsor management fees (d)	 	 	—	  	 	 	—	  	 	 	 		 	 	—	  	 	 	—	  	 	 	9.1	  	 	 	3.5	  	 	 	4.8	  	
Asset impairments (e)	 	 	8.6	  	 	 	—	  	 	 	 		 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	32.9	  	
Site relocation costs (f)	 	 	—	  	 	 	1.7	  	 	 	 		 	 	0.7	  	 	 	2.4	  	 	 	1.8	  	 	 	0.3	  	 	 	1.0	  	
Financing and IPO fees (g)	 	 	—	  	 	 	—	  	 	 	 		 	 	—	  	 	 	—	  	 	 	6.1	  	 	 	3.1	  	 	 	7.6	  	
PECs interest expense (h)	 	 	—	  	 	 	—	  	 	 	 		 	 	1.9	  	 	 	1.9	  	 	 	25.7	  	 	 	12.4	  	 	 	18.6	  	
Other (i)	 	 	(3.8	) 	 	 	(11.8	) 	 	 	 		 	 	(0.6	) 	 	 	(12.4	) 	 	 	2.0	  	 	 	0.9	  	 	 	(35.5	) 	
Tax effect (j)	 	 	(4.9	) 	 	 	2.0	  	 	 	 		 	 	(21.4	) 	 	 	(19.4	) 	 	 	(38.3	) 	 	 	(21.5	) 	 	 	(27.3	) 	
Adjusted Earnings / (Loss) (non-GAAP) (unaudited)	 	 	97.5	  	 	 	86.2	  	 	 	 		 	 	(8.9	) 	 	 	77.3	  	 	 	85.2	  	 	 	11.0	  	 	 	24.3	  	

 	(a)	 	Acquisition and integration related costs incurred in 2012, 2013 and the six months ended June 30, 2014 primarily include costs associated with the Acquisition. Nearly all of the $62.6 million in expenses in	
 
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 	2012 directly related to Acquisition and integration related costs (banking, advisory, legal fees, etc.). In 2013, of the $29.3 million in expenses, $27.9 million related to professional fees incurred to establish Atento as a standalone company not affiliated with Telefónica. These projects mainly relate to the improvement of financial and cash flow reporting ($5.9 million), full strategy review including growth implementation plan and operational set-up with a leading consulting firm ($14.7 million), improving the efficiency in procurement ($4.8 million) and headhunting fees related primarily to strengthening the senior management team post-Acquisition ($1.4 million). Acquisition and integration related costs incurred for the six months ended June 30, 2014 primarily resulted from consulting fees incurred in connection with the full strategy review including our growth implementation plan and operational set-up with a leading consulting firm. We expect these projects to be completed by the end of 2014.	
 	(b)	 	Amortization of Acquisition related intangible assets represents the amortization expense of intangible assets resulting from the Acquisition and has been adjusted to eliminate the impact of the amortization arising from the Acquisition which is not in the ordinary course of our daily operations and distorts comparison with peers and results for prior periods. Such intangible assets primarily include contractual relationships with customers, for which the useful life has been estimated at primarily nine years.	
 	(c)	 	Restructuring costs incurred in 2011, 2012 and 2013 primarily include a number of restructuring activities and other personnel costs that were not related to our core results of operations. Restructuring costs in 2011 primarily relate to costs incurred in connection with the termination of certain members of our executive committee. Restructuring costs in 2012 primarily represent costs incurred in Chile related to the implementation of the new service delivery model with Telefónica which impacted the profile of certain operations personnel and other restructuring costs for certain changes to the executive team in EMEA and Americas. In 2013, $8.6 million of our restructuring costs was related to the relocation of corporate headquarters and severance payments directly related to the Acquisition. In addition, in 2013, we incurred restructuring costs in Spain of $1.5 million (relating to restructuring expenses incurred as a consequence of significant reduction in activity levels as a result of adverse market conditions in Spain) and in Chile of $1.4 million (relating to restructuring expenses incurred in connection with the implementation of a new service delivery model with Telefónica). Restructuring costs incurred for the six months ended June 30, 2014 primarily relate to the headcount reduction plan in Spain which will take into consideration a maximum number of terminations amounting to 9% of the total headcount of Atento Teleservicios España S.A.U. We expect to substantially complete the headcount reduction plan by the fourth quarter of 2014.	
 	(d)	 	Sponsor management fees represent the annual advisory fee paid to Bain Capital Partners, LLC that are expensed during the periods presented. These fees are expected to cease following the offering. See “Certain Relationships and Related Party Transactions—Bain Capital Consulting Services Agreement and Transaction Services Agreement.”	
 	(e)	 	Asset impairment incurred in 2011 is the impairment of the Caribú Project, an intangible asset acquired in 2009 from Telefónica, which represents the right to be the exclusive supplier of customer analysis for 12 Telefónica subsidiaries in Latin America. Asset impairment incurred for the six months ended June 30, 2014 relate to the goodwill and other intangible asset impairment relating to the Czech Republic of $3.8 million and Spain of $29.1 million. The impairment was, in part, a result of the amendment of the MSA with Telefónica by which the minimum revenue commitment for Spain was reduced against a $34.9 million penalty (see note (i) below) compensated by Telefónica.	
 	(f)	 	Site relocation costs incurred in 2012 and 2013 primarily include costs associated with our current strategic initiative of relocating call centers from tier 1 cities to tier 2 cities in Brazil which we expect will be substantially completed by 2015. See “Prospectus Summary—Our Strategy—Best-in-Class Operations—Competitive Site Footprint.”	
 	(g)	 	Financing fees primarily relate to professional fees incurred in 2013 in connection with the issuance of the Senior Secured Notes, the proceeds of which were used to finance a portion of the cost of the Acquisition and to pay financial advisory fees. Financing and IPO fees for the six months ended June 30, 2014 primarily relate to non-core professional fees incurred by us during the initial public offering process. We expect these IPO costs to be completed upon completion of this offering.	
 
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 	(h)	 	PECs Interest expense represents accrued interest on the preferred equity certificates that will be capitalized prior to this offering.	
 	(i)	 	Other includes expense accruals, reversal of expense accruals or income accruals which are not related to our core results of operations. In 2011, the other amount primarily relates to the gain from the sale of the BNH site in Brazil, amounting to $3.6 million. In 2012, the other amount primarily relates to a release of an employee benefits accrual of $11.3 million following the better-than-expected outcome of the collective bargain agreement negotiation in Spain. In 2013, the other amount primarily related to various other consulting expenses, the largest component of which was a $0.5 million charge related to projects for inventory control in Brazil. Other, during the six months ended June 30, 2014, primarily relates to the gain from the $34.9 million penalty fee compensated by Telefónica under the terms of the amended MSA.	
 	(j)	 	The tax effect represents the tax impact of the total adjustments based on a tax rate of 38% for 2011, 33.0% for the period from January 1, 2012 to November 30, 2012, 31.0% for the one-month period from December 1, 2012 to December 31, 2012, 30.0% for 2013, 38.6% for the six months ended June 30, 2013 and 36.0% for the six months ended June 30, 2014.	
 
(3)	We define capital expenditures as the sum of the additions to property, plant and equipment and the additions to intangible assets during the period presented.	
 
(4)	In considering our financial condition, our management analyzes Net debt with third parties, which is defined as total debt less cash, cash equivalents (net of any outstanding bank overdrafts) and short-term financial investments and non-current payables to Group companies (which represent the PECs). The PECs are classified as our subordinated debt relating to our other present and future obligations, and they will be capitalized in connection with this offering. Net debt with third parties is not a measure defined by IFRS.	
Net debt with third parties has limitations as an analytical tool. Net debt with third parties is neither a measure defined by or presented in accordance with IFRS nor a measure of financial performance and should not be considered in isolation or as an alternative financial measure determined in accordance with IFRS. Net debt with third parties is not necessarily comparable to similarly titled measures used by other companies.
The following table sets forth the reconciliation of Total debt to Net debt with third parties utilizing IFRS reported balances obtained from the audited financial statements included elsewhere in this prospectus. Total debt is the most directly comparable financial measure under IFRS for the periods presented.

 	 	Predecessor	 	 	  	 	 	 	Successor	 	 	 	 	
 	 	As of
December 31,
2011	 	 	As of
November 30,
2012	 	 	  	 	 	 	As of
December 31,	 	 	As of
June 30,
2014	 	
($ in millions)	 			 			 	  	 	 	 	2012	 	 	2013	 	 			
 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	(unaudited)	 	
Interest bearing debt (borrowings)	 	 	127.0	  	 	 	88.4	  	 	 	 		 	 	849.2	  	 	 	851.2	  	 	 	745.3	  	
Non-current payables to Group companies	 	 	—	  	 	 	—	  	 	 	 		 	 	471.6	  	 	 	519.6	  	 	 	620.7	  	
Total debt	 	 	127.0	  	 	 	88.4	  	 	 	 		 	 	1,320.8	  	 	 	1,370.8	  	 	 	1,366.0	  	
Non-current payables to Group companies (PECs)	 	 	—	  	 	 	—	  	 	 	 		 	 	(471.6	) 	 	 	(519.6	) 	 	 	(620.7	) 	
Cash, cash equivalents and short-term deposits	 	 	(103.6	) 	 	 	(83.3	) 	 	 	 		 	 	(229.0	) 	 	 	(213.5	) 	 	 	(237.7	) 	
Net debt with third parties (non-GAAP) (unaudited)	 	 	23.4	  	 	 	5.1	  	 	 	 		 	 	620.2	  	 	 	637.7	  	 	 	507.6	  	
 
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The following table sets forth certain unaudited quarterly financial information for each of the periods indicated.

 	 	Quarterly Selected Financial Data	 	
Unaudited
($ in millions)
Consolidated Group	 	For the
quarter
ended
March 31,
2013	 	 	For the
quarter
ended
June 30,
2013	 	 	For the
quarter
ended
September 30,
2013	 	 	For the
quarter
ended
December 31,
2013	 	 	For the
quarter
ended
March 31,
2014	 	 	Q1 2014
change
%	 	 	Q1 2014
change
excluding
FX
%	 	 	For the
quarter
ended
June 30,
2014	 	 	Q2
2014
change
%	 	 	Q2 2014
change
excluding
FX
%	 	
Revenue*	 	 	572.0	  	 	 	595.1	  	 	 	580.3	  	 	 	593.7	  	 	 	561.3	  	 	 	(1.9	) 	 	 	11.5	  	 	 	592.3	  	 	 	(0.5	) 	 	 	7.6	  	
Operating profit	 	 	10.6	  	 	 	25.1	  	 	 	37.4	  	 	 	31.9	  	 	 	20.3	  	 	 	91.5	  	 	 	129.0	  	 	 	12.0	  	 	 	(52.2	) 	 	 	(43.7	) 	
Profit (loss) for the period	 	 	(21.2	) 	 	 	(1.9	) 	 	 	4.7	  	 	 	14.4	  	 	 	(14.6	) 	 	 	(31.1	) 	 	 	26.5	  	 	 	(9.7	) 	 	 	410.5	  	 	 	381.4	  	
EBITDA (non-GAAP)	 	 	44.1	  	 	 	57.6	  	 	 	68.4	  	 	 	63.9	  	 	 	50.9	  	 	 	15.4	  	 	 	31.8	  	 	 	43.0	  	 	 	(25.3	) 	 	 	(18.6	) 	
Adjusted EBITDA (non-GAAP)	 	 	55.8	  	 	 	68.1	  	 	 	85.8	  	 	 	85.4	  	 	 	62.8	  	 	 	12.5	  	 	 	28.5	  	 	 	68.8	  	 	 	1.0	  	 	 	5.9	  	
 
*	Revenue decreased by 7.3% for the three months ended March 31, 2013 as compared to the three months ended March 31, 2012. Excluding the impact of foreign exchange, revenue decreased by 0.4%.	
 
  	Revenue increased by 3.6% for the three months ended June 30, 2013 as compared to the three months ended June 30, 2012. Excluding the impact of foreign exchange, revenue increased 6.9%.	
 
  	Revenue increased by 3.1% for the three months ended September 30, 2013 as compared to the three months ended September 30, 2012. Excluding the impact of foreign exchange, revenue increased 10.9%.	
 
  	Revenue increased by 5.6% for the three months ended December 31, 2013 as compared to the three months ended December 31, 2012. Excluding the impact of foreign exchange, revenue increased 13.4%.	
The following table reconciles our EBITDA and Adjusted EBITDA to profit/(loss) for the period for continuing operations.

Unaudited
($ in millions)
Consolidated Group	 	For the
quarter
ended
March 31,
2013	 	 	For the
quarter
ended
June 30,
2013	 	 	For the
quarter ended
September 30,
2013	 	 	For the
quarter
ended
December 31,
2013	 	 	For the
quarter
ended
March 31,
2014	 	 	Q1
2014
change
%	 	 	Q1 2014
change
excluding FX
%	 	 	For the
quarter
ended
June 30,
2014	 	 	Q2
2014
change
%	 	 	Q2 2014
change
excluding
FX
%	 	
Profit (loss) for the period	 	 	(21.2	) 	 	 	(1.9	) 	 	 	4.7	  	 	 	14.4	  	 	 	(14.6	) 	 	 	(31.1	) 	 	 	26.5	  	 	 	(9.7	) 	 	 	410.5	  	 	 	381.4	  	
Net finance expense	 	 	(37.4	) 	 	 	(23.5	) 	 	 	(25.2	) 	 	 	(14.6	) 	 	 	(32.9	) 	 	 	n/a	  	 	 	n/a	  	 	 	(34.2	) 	 	 	n/a	  	 	 	n/a	  	
Income tax expense	 	 	(5.6	) 	 	 	3.5	  	 	 	7.6	  	 	 	2.8	  	 	 	2.0	  	 	 	n/a	  	 	 	n/a	  	 	 	(12.5	) 	 	 	n/a	  	 	 	n/a	  	
Depreciation and amortization	 	 	33.5	  	 	 	32.5	  	 	 	30.9	  	 	 	32.1	  	 	 	30.6	  	 	 	n/a	  	 	 	n/a	  	 	 	31.0	  	 	 	n/a	  	 	 	n/a	  	
EBITDA (non-GAAP)	 	 	44.1	  	 	 	57.6	  	 	 	68.4	  	 	 	63.9	  	 	 	50.9	  	 	 	15.4	  	 	 	31.8	  	 	 	43.0	  	 	 	(25.3	) 	 	 	(18.6	) 	
Acquisition and integration costs	 	 	7.1	  	 	 	5.7	  	 	 	8.3	  	 	 	8.2	  	 	 	2.4	  	 	 	n/a	  	 	 	n/a	  	 	 	3.0	  	 	 	n/a	  	 	 	n/a	  	
Asset impairment	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	n/a	  	 	 	n/a	  	 	 	32.9	  	 	 	n/a	  	 	 	n/a	  	
Restructuring costs	 	 	0.3	  	 	 	1.3	  	 	 	2.5	  	 	 	8.7	  	 	 	5.0	  	 	 	n/a	  	 	 	n/a	  	 	 	16.6	  	 	 	n/a	  	 	 	n/a	  	
Sponsor management fee	 	 	2.0	  	 	 	1.5	  	 	 	2.4	  	 	 	3.2	  	 	 	2.7	  	 	 	n/a	  	 	 	n/a	  	 	 	2.1	  	 	 	n/a	  	 	 	n/a	  	
Site relocation costs	 	 	—	  	 	 	0.3	  	 	 	1.5	  	 	 	—	  	 	 	—	  	 	 	n/a	  	 	 	n/a	  	 	 	1.0	  	 	 	n/a	  	 	 	n/a	  	
Financing and IPO fees	 	 	2.0	  	 	 	1.1	  	 	 	1.9	  	 	 	1.1	  	 	 	1.9	  	 	 	n/a	  	 	 	n/a	  	 	 	5.7	  	 	 	n/a	  	 	 	n/a	  	
Other	 	 	0.3	  	 	 	0.6	  	 	 	0.8	  	 	 	0.3	  	 	 	(0.1	) 	 	 	n/a	  	 	 	n/a	  	 	 	(35.4	) 	 	 	n/a	  	 	 	n/a	  	
Adjusted EBITDA (non-GAAP)	 	 	55.8	  	 	 	68.1	  	 	 	85.8	  	 	 	85.4	  	 	 	62.8	  	 	 	12.5	  	 	 	28.5	  	 	 	68.8	  	 	 	1.0	  	 	 	5.9	  	
 
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 MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The historical financial statements included elsewhere in this prospectus, which are the subject of the following discussion and analysis, are the Predecessor financial statements and the Successor financial statements. We have historically conducted our business through the Predecessor up to November 30, 2012 and, subsequent to the Acquisition, through the Successor and therefore, our historical financial statements present the results of operations of the Predecessor and Successor. Prior to the completion of this offering, the Successor will become the Issuer’s wholly-owned subsidiary, whereby the historical financial statements of the Successor and the Predecessor will become the historical financial statements of the Issuer.
The following discussion and analysis of our financial condition and the results of operations is based upon and should be read in conjunction with the Predecessor financial statements and the Successor financial statements and the related notes included in this prospectus. The Predecessor financial statements and the Successor financial statements have been prepared in accordance with IFRS as issued by the IASB, which may differ in material respects from generally accepted accounting principles in other jurisdictions, including the United States. The following discussion includes forward-looking statements. Our actual results could differ materially from those that are discussed in these forward-looking statements. Factors which could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this prospectus, particularly under “Forward-Looking Statements” and “Risk Factors.”
Overview
We are the largest provider of CRM BPO services and solutions in Latin America and Spain, and among the top three providers, globally based on revenues. Our tailored CRM BPO solutions are designed to enhance each of our clients’ ability to deliver a high-quality product by creating a best-in-class experience for their customers, enabling our clients to focus on operating their core businesses. We utilize our industry domain and customer care operations expertise, combined with a consultative approach, to offer superior and scalable solutions across the entire customer care value chain, customized for each individual client’s needs and sophistications.
We offer a comprehensive portfolio of customizable, yet scalable, solutions that comprise front-end and back-end services ranging from sales, applications processing, customer care and credit management. From our suite of products and value-added services, we derive embedded and integrated industry-tailored solutions for a large and diverse group of multi-national companies. Our solutions to our base of over 400 clients are delivered by approximately 153,000 of our highly engaged customer care specialists and facilitated by our best-in-class technology infrastructure and multi-channel delivery platform. We believe we bring a differentiated combination of scale, customer transaction processing capacity and industry expertise to our clients’ customer care operations, which allow us to provide higher-quality customer care services more cost-effectively than our clients could deliver on their own.
Basis of Preparation
We prepare our financial statements in accordance with IFRS as issued by the IASB. As a result of the Acquisition, we applied acquisition accounting whereby the purchase price paid was allocated to the acquired assets and assumed liabilities at fair value. See Note 2 to the Successor financial statements for further detail. Our financial reporting periods presented herein are as follows:
 
 	•	 	The Predecessor period refers to the year ended December 31, 2011 and the period from January 1, 2012 through November 30, 2012 and reflects the combined carve-out results of operations of the Predecessor.	
 
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 	•	 	The Successor period reflects the consolidated results of operations of the Successor, which includes the effects of acquisition accounting, for the period from December 1, 2012 to December 31, 2012, for the year ended December 31, 2013 and for the six months period ended June 30, 2014.	
The results of operations for the year ended December 31, 2011 and for the period from January 1, 2012 to November 30, 2012 presented herein were derived from our audited Predecessor financial statements and related notes thereto included elsewhere in this prospectus. The results of operations for the one-month period from December 1, 2012 to December 31, 2012 and for the year ended December 31, 2013 presented herein were derived from our audited Successor financial statements and related notes thereto included elsewhere in this prospectus.
The unaudited Aggregated 2012 Financial Information is derived by adding together the corresponding data from the audited Predecessor financial statements for the period from January 1, 2012 to November 30, 2012 and the corresponding data from the audited Successor financial statements for the one-month period from December 1, 2012 to December 31, 2012 appearing elsewhere in this prospectus. Prior to the Acquisition, the Predecessor financial statements were prepared on a combined carve-out basis from the Atento business of Telefónica. See Note 2 to the Predecessor financial statements. The allocations in Predecessor periods were based upon various assumptions and estimates and actual results may differ from these allocations, assumptions and estimates. Accordingly, the Predecessor financial statements should not be relied upon as being representative of our financial position, results of operations or cash flows had we operated on a standalone basis. The financial data for the one-month period from December 1, 2012 to December 31, 2012 used in the preparation of the unaudited Aggregated 2012 Financial Information include the impact of the Acquisition on the results of operations derived from our new financing structure, the new basis of accounting for the assets acquired and the liabilities assumed and the costs incurred in connection with the Acquisition, which are mainly reflected in depreciation and amortization, other operating expenses and finance costs.
This presentation of our unaudited Aggregated 2012 Financial Information is for illustrative purposes only, is not presented in accordance with IFRS, and is not necessarily comparable to previous or subsequent periods, or indicative of results expected in any future period.
Segments
We offer our CRM BPO services to clients primarily in Latin America and EMEA. Our business is comprised of three geographic operating segments:
 
 	•	 	Brazil;	
 
 	•	 	Americas, which includes the activities carried out by the various Spanish-speaking companies in Mexico, Central and South America (excluding Brazil). It also includes operations in the United States; and	
 
 	•	 	EMEA (Europe, Middle East and Africa), which consists of our operations in Spain, the Czech Republic and Morocco.	
See Note 23 to the Successor financial statements and Note 20 to the Predecessor financial statements for additional information on our segment results.
Key Factors Affecting Results of Operations
We believe that the following factors have significantly affected our results of operations for the years ended December 31, 2011, 2012 and 2013.
 
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Macroeconomic Trends
Latin America
A substantial proportion of our business is carried out in Latin America. In the Latin America region, which includes our operating segments in Brazil and the Americas, we generated 83.6%, 83.7% and 84.5% of our revenue (in each case, before holding company level revenue and consolidation adjustments) for the years ended December 31, 2011, 2012 and 2013, respectively. As a result, our financial condition and results of operations are significantly influenced by macroeconomic developments in Latin America. See “Risk Factors—Risks Related to Our Business—A substantial portion of our revenue, operations and investments are located in Latin America and we are therefore exposed to risks inherent in operating and investing in the region.” In recent years, macroeconomic conditions have tended to be favorable in many of the countries in the region, including growth in GDP, purchasing power, a growing middle class and relatively stable currency exchange rates and inflation. Based on data from the Economist Intelligence Unit (“EIU”), we believe that these positive macroeconomic trends in Latin America will continue over the long term and lead to increased demand for our services.
Employee benefit expenses are our single largest cost item representing $1,701.9 million (70.4% of our total revenues), $1,609.5 million (69.5% of our total revenues) and $1,643.5 million (70.2% of our total revenues) in 2011, 2012 and 2013, respectively. We operate in geographies with high wage inflation as in Brazil where average wage inflation based on EIU was 10.6% and 8.6% in 2012 and 2013, respectively. We were able to maintain employee benefit expenses stable as a percentage of revenues between 2011 and 2013 through (i) price increases as most of our contracts contain provisions that allow us to pass on to our customers increased costs that result from inflation adjustments, (ii) cost efficiencies related to enhanced productivity investment in our IT platform and procurement process as well as HR improvements (see “—Our Strategy—Best in Class Operations”), (iii) delivering increasingly complex solutions and value-added services to our clients positively affecting margins (see “—Our Strategy—Develop and Deliver CRM BPO Solutions”) and (iv) minimizing wage inflation through collective bargaining agreements.
 
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The table below sets forth the GDP, GDP growth, population growth, consumer price inflation and unemployment for the periods and countries indicated.

 	  	Brazil	 	 	Mexico	 	 	Argentina (1)	 	 	Chile	 	 	Colombia	 	 	Peru	 	
GDP (US$ in billions at 2005 constant prices)	  				 				 				 				 				 				
2011	  	$	1,126	  	 	$	990	  	 	$	276	  	 	$	157	  	 	$	195	  	 	$	120	  	
2012	  	 	1,138	  	 	 	1,027	  	 	 	282	  	 	 	165	  	 	 	203	  	 	 	127	  	
2013	  	 	1,164	  	 	 	1,040	  	 	 	295	  	 	 	172	  	 	 	212	  	 	 	134	  	
							
GDP growth (year-over-year)	  				 				 				 				 				 				
2011	  	 	2.7	% 	 	 	4.0	% 	 	 	8.9	% 	 	 	5.8	% 	 	 	6.6	% 	 	 	6.9	% 	
2012	  	 	1.0	  	 	 	3.7	  	 	 	1.9	  	 	 	5.4	  	 	 	4.2	  	 	 	6.3	  	
2013	  	 	2.3	  	 	 	1.3	  	 	 	4.9	  	 	 	4.1	  	 	 	4.3	  	 	 	5.2	  	
							
Population growth (year-over-year)	  				 				 				 				 				 				
2011	  	 	1.0	% 	 	 	1.2	% 	 	 	0.9	% 	 	 	0.9	% 	 	 	1.3	% 	 	 	1.3	% 	
2012	  	 	0.9	  	 	 	1.0	  	 	 	0.9	  	 	 	0.9	  	 	 	1.3	  	 	 	1.3	  	
2013	  	 	0.9	  	 	 	1.1	  	 	 	0.9	  	 	 	0.9	  	 	 	1.3	  	 	 	1.3	  	
							
Consumer price inflation (year-over-year) 	  				 				 				 				 				 				
2011	  	 	6.6	% 	 	 	3.4	% 	 	 	24.4	% 	 	 	3.3	% 	 	 	3.4	% 	 	 	3.4	% 	
2012	  	 	5.4	  	 	 	4.1	  	 	 	25.3	  	 	 	3.0	  	 	 	3.2	  	 	 	3.7	  	
2013	  	 	6.2	  	 	 	3.8	  	 	 	20.7	  	 	 	1.9	  	 	 	2.0	  	 	 	2.8	  	
							
Unemployment	  				 				 				 				 				 				
2011	  	 	6.0	% 	 	 	5.2	% 	 	 	7.2	% 	 	 	6.6	% 	 	 	10.8	% 	 	 	7.9	% 	
2012	  	 	5.5	  	 	 	5.0	  	 	 	7.2	  	 	 	6.1	  	 	 	10.4	  	 	 	5.2	  	
2013	  	 	5.4	  	 	 	4.9	  	 	 	7.1	  	 	 	5.7	  	 	 	9.7	  	 	 	5.5	  	
							
Average Wage Inflation	  				 				 				 				 				 				
2011	  	 	12.7	% 	 	 	5.3	% 	 	 	27.7	% 	 	 	5.9	% 	 	 	4.6	% 	 	 	4.0	% 	
2012	  	 	10.6	  	 	 	5.5	  	 	 	26.8	  	 	 	6.4	  	 	 	4.4	  	 	 	4.0	  	
2013	  	 	8.6	  	 	 	5.0	  	 	 	25.1	  	 	 	5.7	  	 	 	2.1	  	 	 	4.2	  	

Source:	Economist Intelligence Unit (“EIU”).	
(1)	EIU sources Argentina data from PriceStat due to widespread concerns over reliability of official data series.	

 	  	Brazil	 	  	Mexico	 	  	Argentina	 	  	Chile	 	  	Colombia	 	  	Peru	 	
End of period U.S. dollar exchange rate	  				  				  				  				  				  				
2011	  	 	1.88	  	  	 	13.95	  	  	 	4.30	  	  	 	519.20	  	  	 	1,942.70	  	  	 	2.70	  	
2012	  	 	2.04	  	  	 	12.97	  	  	 	4.92	  	  	 	479.96	  	  	 	1,768.23	  	  	 	2.55	  	
2013	  	 	2.34	  	  	 	13.08	  	  	 	6.52	  	  	 	524.61	  	  	 	1,926.83	  	  	 	2.80	  	
As of July 28, 2014	  	 	2.23	  	  	 	12.99	  	  	 	8.18	  	  	 	563.57	  	  	 	1,847.88	  	  	 	2.78	  	

Source:	As reported by the relevant central bank of each country.	
EMEA
The remainder of our business is carried out in EMEA. In EMEA, which consists primarily of our operations in Spain, we generated 16.4%, 16.3% and 15.5% of our revenue (in each case, before holding company level revenue and consolidation adjustments) for the years ended December 31, 2011, 2012 and 2013, respectively. As a result, our financial condition and results of operations are influenced by macroeconomic developments in Europe, and more specifically Spain. According to EIU, Spain’s real GDP declined at a CAGR of 0.9% from 2010 to 2013 and unemployment rose from 20.1% to 26.4% during the same period. However, based on data from EIU, we believe that these adverse macro-economic conditions will begin to recover in 2014.
 
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Impact of Foreign Currency Translation
As we have operations in countries with different currencies, foreign currency fluctuations have had an impact on our results of operations. Nevertheless, we benefit from the fact that the majority of the revenue we collect in each country in which we have operations is principally denominated in the same currency as the operating expenses we incur in that country, providing us with a natural hedge. For the years ended December 31, 2011, 2012 and 2013, 94.1%, 94.3% and 95.4%, respectively, of the revenue we collected in each country in which we have operations was denominated in the same currency as the operating expenses we incurred in earning this revenue. Our indebtedness is either denominated in local currency or in the case of indebtedness denominated in U.S. dollars, hedged in local currencies. See “Description of Certain Indebtedness” and “—Quantitative and Qualitative Disclosures About Market Risk—Foreign Currency Risk.” While we face foreign currency translation risk for the purposes of preparing our consolidated financial statements, the impact on operating profit, profit for the period, cash flows, EBITDA and dividends is mitigated, to a certain degree, by our ability to match the above percentages of revenue with expenses in the same local currencies.
The main impact of foreign currency fluctuations on us can be summarized as follows:
 
 	•	 	Translation differences (impact on the statements of changes in equity and cash flows) . For the year ended December 31, 2013, 98.0% of our revenue was generated in non-U.S. dollar currency countries. As such, we are affected by variations in exchange rates resulting from the conversion of the financial statements of our subsidiaries operating in currencies other than the U.S. dollar through the consolidation process. For the purposes of preparing our financial statements, we convert our subsidiaries’ financial statements as follows: statements of financial position are translated into U.S. dollars from local currencies at the period-end exchange rate, shareholders’ equity is translated at historical exchange rates prevailing on the transaction date and income and cash flow statements are translated at average exchange rates for the period.	
 
 	•	 	Foreign exchange differences (impact on income statements and statements of cash flow). This includes losses or profits generated by the changing value of non-functional currency monetary assets and liabilities due to exchange rate variations.	
 
 	•	 	Year-on-year growth . The year-on-year variation in exchange rates directly impacts our growth. Reported revenue growth in 2013 was 1.0%, whereas excluding the impact of fluctuations in foreign exchange, revenue increased by 7.5% compared to 2012. Reported revenue decreased by 4.2% in 2012, whereas excluding the impact of foreign exchange, revenue increased by 6.7% compared to 2011.	
In the discussion below of our results of operations, we have provided certain comparisons on both an as reported and a constant currency basis. The constant currency presentation is a non-GAAP financial measure, which excludes the impact of fluctuations in foreign currency exchange rates. We believe providing constant currency information provides valuable supplemental information regarding our results of operations, consistent with how we evaluate our performance. We calculate constant currency percentages by converting our results of operations into U.S. dollars for the period using the average exchange rate of the prior period and comparing these adjusted amounts to our prior period reported results. We refer to such comparisons as being made on a “constant currency basis” or as “excluding the impact of foreign exchange.” This calculation may differ from similarly titled measures used by others and, accordingly, the constant currency presentation is not meant to be a substitution for recorded amounts presented in conformity with IFRS nor should such amounts be considered in isolation. Moreover, constant currency presentations are not necessarily indicative of historical or future results of operations. Currency fluctuations affect general economic and business conditions, including, for example, a country’s inflation and international trade competitiveness and, as a result, a company’s performance cannot be evaluated solely on the basis of a constant currency presentation.
Client Relationship with Telefónica
Telefónica, a leading global telecommunications company and our owner prior to the Acquisition, and its various affiliates, has been our most important client in terms of revenue, and we currently anticipate that they
 
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will continue to be our most important client in the near future. Since 1999, when Telefónica contributed approximately 90% of the revenue of the AIT Group, we have pursued the diversification of our client base such that the revenue from Telefónica Group companies was 51.1%, 50.0% and 48.5% in the years ended December 31, 2011, 2012 and 2013, respectively, as revenue from non-Telefónica customers has grown faster than revenue from Telefónica. For the six months ended June 30, 2014, revenue from the Telefónica Group was 46.7%.
Our service agreements with Telefónica Group companies remained in effect following the consummation of the Acquisition, and we entered into the MSA, a new framework agreement that replaced our prior framework agreement with Telefónica which has a term that ends on December 31, 2021. The MSA requires the Telefónica Group companies to meet pre-agreed minimum annual revenue commitments in the jurisdictions in which we currently conduct business (other than Argentina). See “Business—Our Clients—Telefónica Group Master Service Agreement” for a brief discussion of the material terms of the MSA. The MSA is not intended to affect the existing service contracts, which generally remain in effect in accordance with their terms (including their respective payment terms) and are renegotiated individually. See “Risk Factors—Risks Related to Our Business—Telefónica, certain of its affiliates and a few other major clients account for a significant portion of our revenue and any loss of a large portion of business from these clients could have a material adverse effect on our business, financial condition, results of operations and prospects.”
Fluctuations in our Operating Profit Margins
A number of factors have affected our operating profit margins during the periods discussed below, including, but not limited to, the following:
Increases in employee salaries resulting from inflation
Most of our service contracts with our clients provide for pricing adjustments that result from changes in macroeconomic conditions (e.g., increases or decreases in the consumer price index of an applicable jurisdiction). However, when salary levels of our employees increase, we may not be able to fully pass on these increases to our clients or do so on a timely basis, which tends to depress our operating profit margins if we cannot offset these increases in employee salaries above inflationary levels or generate sufficient operating efficiency gains.
Increase in amortization expenses
In connection with the Acquisition, we have recognized $383.3 million of additional intangible assets in 2012 as part of the allocation of the purchase price to the acquired assets and assumed liabilities. These intangible assets, which represent our client relationships with Telefónica and with other clients, generally have useful lives estimated to be nine years. The amortization of these intangible assets had a negative impact of $40.7 million on our operating profit for the year ended December 31, 2013, as compared to an immaterial amount in 2012 and none in 2011. During the period over which we will amortize these assets, assuming that there is no impairment in the future, there will be a continuing impact of the straight-line amortization of these assets on our operating profit margins.
Increased set-up costs driven by increased demand
A significant increase in demand in the market for CRM BPO services can directly result in an increase in employee benefits expenses which we incur to hire and train additional employees to meet increased demand. As these expenses for hiring and training our employees are typically incurred in an earlier period than the expected accrual of the related revenue from the increase in demand, it has the effect of causing temporary decreases in our operating profit margins.
 
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Fluctuations in demand
Any significant fluctuation in the volume of services demanded by our clients would require us to adjust the number of employees to adapt to such changes in demand. As our business depends on maintaining and training large numbers of employees to service our clients’ business needs, we cannot terminate employees on short notice to respond to sudden or unexpected changes in demand, as rehiring and retraining employees at a later date would force us to incur additional expenses. Furthermore, any termination of our employees would also involve the incurrence of significant additional costs in the form of severance payments to comply with employment regulations in various jurisdictions in which we operate our business, all of which would have an adverse impact on our operating profit margins. However, the risk associated with fluctuations in demand may be partially mitigated by the long-term growth trends of the industry that we anticipate in Brazil and the Americas, as well as our focus on efficiencies in operating costs.
Effect of Operating Leases
We routinely lease call center facilities, buildings and equipment under operating leases in the regions in which we conduct our operations rather than purchase those buildings and equipment as some of our competitors do. Our operating lease expenses decreased from $138.0 million in 2011 to $124.6 million in 2012 and to $118.3 million in 2013, primarily as a result of the effect of foreign exchange fluctuation. As a percentage of revenue, such operating leases represented 5.7%, 5.4% and 5.1%, respectively. The number of workstations we use in our service delivery centers increased from 73,249 as of December 31, 2011 to 75,682 as of December 31, 2012 and 79,197 as of December 31, 2013. We operated 81,625 workstations as of June 30, 2014. Since we lease all of our call center facilities, which increases our operating expenses and does not result in a depreciation expense, our EBITDA performance has historically differed from competitors who own their buildings and equipment, as related financings have generally resulted in higher depreciation expenses for those competitors and have increased such competitors’ EBITDA.
Seasonality
Our performance is subject to seasonal fluctuations. For each of the periods presented herein, our performance was lower in the first quarter of the year than in the remaining three quarters of the year. This is primarily due to the fact that (i) our clients generally spend less in the first quarter of the year after the year-end holiday season, (ii) the initial costs to train and hire new employees at new service delivery centers to provide additional services to our clients are usually incurred in the first quarter of the year, and (iii) statutorily mandated minimum wage and salary increases of operators, supervisors and coordinators in many of the countries in which we operate are generally implemented at the beginning of the first quarter of each year, whereas revenue increases related to inflationary adjustments and contracts negotiations generally take effect after the first quarter. We have also found that our revenue increases further in the last quarter of the year, especially in November and December, as the year-end holiday season begins and we have an increase in business activity resulting from the handling of holiday season promotions offered by our clients. These seasonal effects also cause differences in revenue and expenses among the various quarters of any financial year, which means that the individual quarters of a year should not be directly compared with each other or be used to predict annual financial results.
Significant Market Trends
We believe that the following significant market trends are the most important trends affecting our results of operations, and we believe these will continue to have a material impact on our results of operations in the future.
Continuing Trend for Further Outsourcing for CRM Services
In recent years, companies have increasingly sought to outsource certain non-core business activities, such as customer care services and sales functions, especially in the regions in which we have significant business
 
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operations, including Latin America. This trend towards outsourcing non-core business activities has, in our view, principally been driven by rising costs, competitive pressures and increased operational complexity, resulting in the need to outsource these non-core business activities to enable companies to focus on their core competencies. The penetration within individual clients in the market for CRM BPO services has increased significantly in recent years. We believe there are two main drivers of this increase in penetration: first, existing users of CRM BPO are outsourcing more of their CRM operations to specialist third party BPO providers; secondly, new clients are adopting third party solutions for these services as opposed to using in-house solutions, to take advantage of the labor arbitrage, specialist knowledge and cost efficiencies.
Growth in Our Business Directly Linked to Growth in the Businesses of Key Clients
We structure our contracts with our clients such that, while the price of our services is agreed, the volume of CRM BPO services we deliver during a particular period depends upon the performance of our clients’ business. As our current business is significantly exposed to the telecommunications and financial services sectors, our business is particularly dependent upon the continued growth of our clients’ business in those sectors. As a result, if the business of one of our key clients increases, resulting in the generation of more customer activity, our business also increases as that customer activity is outsourced to us. On the other hand, if the business of one of our key clients decreases resulting in a reduction of customer activity, our business also decreases, as less customer activity will be outsourced to us.
Development of CRM BPO Solutions
The industry is experiencing a transition towards outsourcing more complex multi-channel solutions, thus creating an opportunity for CRM BPO providers, including us, to up-sell and cross-sell our services. Our vertical industry expertise in telecommunications, financial services and multi-sector, allows us to develop tailored solutions for our clients, further embedding us into their value chain while delivering impactful business results and increasing the portion of our client’s CRM BPO services we provide. We have proactively diversified and expanded our solutions offering, increasing their sophistication and developing customized solutions such as our smart collections, B2B Efficient sales, Insurance Management, Credit Management and other BPO processes. We expect the share of revenue from CRM BPO solutions to increase going forward.
New Pricing Models for Our CRM BPO Services
We operate in a competitive industry which from time to time exhibits pressure on pricing for CRM BPO services. We believe that we have a strong track record in successful pricing negotiations with our clients by offering flexible pricing models with fixed pricing, variable pricing, and outcome-based pricing if certain performance indicators are achieved, depending on the type of CRM BPO services our clients purchase from us and their business objectives. We also believe that new contracts will increasingly be based on more outcome-based pricing and hybrid pricing models as means of making services more transparent and further driving demand for CRM BPO services. In addition, our service contracts with most of our key clients include inflation-based adjustments to offset adverse inflationary effects which (depending on the movements in the applicable consumer price indices (“CPIs”) of the countries in which our clients operate) will have the effect of increasing, if the CPI of an applicable jurisdiction increases, or decreasing, if the CPI decreases, the employee benefits expenses which we can pass onto our clients. We believe that our flexible pricing models allow us to maximize our revenue in a price competitive environment while maintaining the high quality of our CRM BPO services.
Potential Customers May be Reluctant to Change Their CRM BPO Service Provider
As companies begin to use the services of CRM BPO services providers more extensively as their businesses grow, they become more reliant on the CRM BPO services provider because the companies often expand the range and scope of the CRM BPO services which they use. For example, for the year ended December 31, 2013, 69% of our revenue from client groups other than the Telefónica Group came from clients
 
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that had relationships with us for ten or more years. Furthermore, for the years ended December 31, 2011, 2012 and 2013, our retention rates (calculated based on prior year revenue of clients retained in current year, as a percentage of total prior year revenues) were 97.9%, 98.5% and 99.3%, respectively. We believe it is difficult for clients to switch a large number of workstations to competitors principally because of the following factors: (i) the extensive training required for the service provider’s employees; (ii) the level of process integration with the provider which can be time consuming and costly; and (iii) the potential disruption caused to the client’s users by introducing a new end-service provider. As a result, absent a compelling reason to change CRM BPO service provider, such as significant differences in quality or price, companies generally tend to stay with their CRM BPO services provider, making it difficult for another CRM BPO services provider to acquire the client’s work.
Description of Principal Income Statement Items
Revenue
Revenue is principally generated by providing CRM BPO services to our clients. Revenue is recognized on an accrual basis, accounting for the related amounts as the services are provided to the client, when the teleoperation occurs or when certain contact center consulting work is carried out. Invoicing schemes may be fixed, variable, hybrid or outcome-based, with the tendency to follow models where invoices are issued based on customer business indicators.
Other operating income
Other operating income includes grants received from governments and government entities in the countries in which we operate. To receive these grants, we must commit to employ persons from certain population segments or to operate our business in certain areas to generate employment opportunities in those areas. Other operating income also includes gains from the disposal of fixed assets and recoveries from insurance claims.
Total operating expenses
Our operating expenses consist principally of:
 
 	•	 	Supplies . Supplies consist of costs principally incurred in the provision of our services to our clients, including telecommunications and technology services, as well as the costs of leasing workstations within service delivery centers owned by our clients.	
 
 	•	 	Employee benefit expense . Employee benefits expenses consist of the total remuneration paid to our employees and administrative and executive staff, including a base salary and additional compensation depending on the status of the employee (permanent or temporary), as well as employee termination costs.	
 
 	•	 	Depreciation and amortization . Depreciation and amortization consist of the recognition of a charge for all tangible and intangible assets with finite lives using the straight-line method over their useful life.	
 
 	•	 	Changes in trade provisions . Changes in trade provisions include the result of changes in the provision for bad debt.	
 
 	•	 	Other operating expenses . Other operating expenses consist of the costs of leasing facilities, buildings and computer workstations in our service delivery centers, installation and maintenance, professional services including consulting, legal and other professional advisory services fees, utilities, transportation, travel expenses, taxes (excluding corporate income tax), penalties, fines and contingencies and impairment of assets, among others.	
 
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Operating profit/(loss)
Operating profit/(loss) consists principally of revenue and other operating income less operating expenses.
Finance income
Finance income consists principally of interest on cash surpluses, income from long-term monetary investments and gains on adjustment for fair value of financial instruments.
Finance costs
Finance costs consist principally of interest and other expenses paid on short- and long-term loans and borrowings, as well as interest and expenses on current account overdrafts and losses on adjustment for fair value of financial instruments.
Net foreign exchange gain/(loss)
Net foreign exchange gain/(loss) consists of gains and losses originating from currency exchange differences related to assets and liabilities denominated in foreign currencies.
Income tax expense
Income tax expense consists of the corporate income tax to be paid on our corporate profit, including deferred tax.
Profit/(Loss) for the period
Profit/(loss) for the period consists of total of profit/(loss) for the period from continuing operations and from discontinued operations.
Results of Operations
The tables below set forth our historical results of operations, other financial data and the percentage change between the periods ended December 31, 2011, 2012 and 2013 and June 30, 2013 and 2014. Due to the Acquisition, the financial data for the Successor period may not be comparable to that of the Predecessor period presented in the accompanying table. The unaudited Aggregated 2012 Financial Information is derived by adding together the corresponding data from the audited Predecessor financial statements for the period from January 1, 2012 to November 30, 2012 and the corresponding data from the audited Successor financial statements for the one-month period from December 1, 2012 to December 31, 2012 appearing elsewhere in this prospectus. Prior to the Acquisition, the Predecessor financial statements were prepared on a combined carve-out basis from the Atento business of Telefónica. See Note 2 to the Predecessor financial statements. The allocations in Predecessor periods were based upon various assumptions and estimates and actual results may differ from these allocations, assumptions and estimates. Accordingly, the Predecessor financial statements should not be relied upon as being representative of our financial position, results of operations or cash flows had we operated on a standalone basis. The financial data for the one-month period from December 1, 2012 to December 31, 2012 used in the preparation of the unaudited Aggregated 2012 Financial Information include the impact of the Acquisition on the results of operations derived from our new financing structure, the new basis of accounting for the assets acquired and the liabilities assumed and the costs incurred in connection with the Acquisition, which are mainly reflected in depreciation and amortization, other operating expenses and finance costs. This presentation of our
 
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unaudited Aggregated 2012 Financial Information is for illustrative purposes only, is not presented in accordance with IFRS and is not necessarily comparable to previous or subsequent periods, or indicative of results expected in any future period. The consolidated historical financial information for the six-months ended June 30, 2014 and 2013 presented below were derived from the Interim financial statements included elsewhere in this prospectus.

 	 	Predecessor	 	 	 	 	 	 	Successor	 	 	Non-IFRS
Aggregated	 	 	 	 	 	 	 	 	Successor	 	 	 	 	 	 	 	
($ in millions, except
percentage changes)	 	As of and
for the year
ended
December 31,
2011	 	 	As of and
for the
period
from Jan 1
– Nov 30,
2012	 	 	 	 	 	 	As of and
for the
period
from Dec 1
– Dec 31,
2012	 	 	For the year
ended
December 31,
2012	 	 	Change
%	 	 	Change
excluding
FX
%	 	 	As of and for
the year
ended
December 31,
2013	 	 	Change
%	 	 	Change
excluding
FX
%	 	
 	 	 	 	 	 	 	 		 		 	 	 	 	(unaudited)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Revenue	 	 	2,417.3	  	 	 	2,125.9	  	 	 	 		 	 	190.9	  	 	 	2,316.8	  	 	 	(4.2	) 	 	 	6.7	  	 	 	2,341.1	  	 	 	1.0	  	 	 	7.5	  	
Other operating income	 	 	7.2	  	 	 	1.9	  	 	 	 		 	 	1.8	  	 	 	3.7	  	 	 	(48.6	) 	 	 	(44.4	) 	 	 	4.4	  	 	 	18.9	  	 	 	21.6	  	
Own work capitalized	 	 	—	  	 	 	—	  	 	 	 		 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	0.9	  	 	 	N.M.	  	 	 	N.M.	  	
Operating expenses:	 				 				 	 	 		 				 				 				 				 				 				 				
Supplies	 	 	(129.8	) 	 	 	(105.5	) 	 	 	 		 	 	(8.4	) 	 	 	(113.9	) 	 	 	(12.2	) 	 	 	(2.3	) 	 	 	(115.3	) 	 	 	1.2	  	 	 	6.8	  	
Employee benefit expense	 	 	(1,701.9	) 	 	 	(1,482.8	) 	 	 	 		 	 	(126.7	) 	 	 	(1,609.5	) 	 	 	(5.4	) 	 	 	5.1	  	 	 	(1,643.5	) 	 	 	2.1	  	 	 	8.5	  	
Depreciation and amortization	 	 	(78.5	) 	 	 	(78.1	) 	 	 	 		 	 	(7.5	) 	 	 	(85.6	) 	 	 	9.0	  	 	 	20.1	  	 	 	(129.0	) 	 	 	50.7	  	 	 	57.0	  	
Changes in trade provisions	 	 	(2.7	) 	 	 	(13.9	) 	 	 	 		 	 	2.8	  	 	 	(11.1	) 	 	 	N.M.	  	 	 	N.M.	  	 	 	2.0	  	 	 	N.M.	  	 	 	N.M.	  	
Other operating expenses	 	 	(356.0	) 	 	 	(283.7	) 	 	 	 		 	 	(95.3	) 	 	 	(379.0	) 	 	 	6.5	  	 	 	18.3	  	 	 	(355.6	) 	 	 	(6.2	) 	 	 	(0.6	) 	
Total operating expenses	 	 	(2,268.9	) 	 	 	(1,964.0	) 	 	 	 		 	 	(235.1	) 	 	 	(2,199.1	) 	 	 	(3.1	) 	 	 	7.7	  	 	 	(2,241.4	) 	 	 	1.9	  	 	 	8.1	  	
Operating profit/(loss)	 	 	155.6	  	 	 	163.8	  	 	 	 		 	 	(42.4	) 	 	 	121.4	  	 	 	(22.0	) 	 	 	(10.3	) 	 	 	105.0	  	 	 	(13.5	) 	 	 	(1.2	) 	
Finance income	 	 	10.9	  	 	 	11.6	  	 	 	 		 	 	2.6	  	 	 	14.2	  	 	 	30.3	  	 	 	44.0	  	 	 	17.8	  	 	 	25.4	  	 	 	32.4	  	
Finance costs	 	 	(19.2	) 	 	 	(23.5	) 	 	 	 		 	 	(8.7	) 	 	 	(32.2	) 	 	 	67.7	  	 	 	87.5	  	 	 	(135.1	) 	 	 	N.M.	  	 	 	N.M.	  	
Net foreign exchange gain / (loss)	 	 	(2.8	) 	 	 	(1.0	) 	 	 	 		 	 	—	  	 	 	(1.0	) 	 	 	(64.3	) 	 	 	(50.0	) 	 	 	16.6	  	 	 	N.M.	  	 	 	N.M.	  	
Net finance expense	 	 	(11.1	) 	 	 	(12.9	) 	 	 	 		 	 	(6.0	) 	 	 	(19.0	) 	 	 	71.2	  	 	 	95.5	  	 	 	(100.7	) 	 	 	N.M.	  	 	 	N.M.	  	
Profit/(loss) before tax	 	 	144.5	  	 	 	150.9	  	 	 	 		 	 	(48.5	) 	 	 	102.4	  	 	 	(29.1	) 	 	 	(18.4	) 	 	 	4.3	  	 	 	(95.8	) 	 	 	(85.4	) 	
Income tax expense	 	 	(54.9	) 	 	 	(60.7	) 	 	 	 		 	 	(8.1	) 	 	 	(68.8	) 	 	 	25.3	  	 	 	27.5	  	 	 	(8.3	) 	 	 	(87.9	) 	 	 	(82.7	) 	
Profit/(loss) for the period	 	 	90.3	  	 	 	90.2	  	 	 	 		 	 	(56.6	) 	 	 	33.6	  	 	 	(62.8	) 	 	 	(47.0	) 	 	 	(4.0	) 	 	 	(111.9	) 	 	 	(90.8	) 	
Profit/(loss) for the period from continuing operations	 	 	89.6	  	 	 	90.2	  	 	 	 		 	 	(56.6	) 	 	 	33.6	  	 	 	(62.5	) 	 	 	(46.5	) 	 	 	(4.0	) 	 	 	(111.9	) 	 	 	(90.8	) 	
Profit after tax from discontinued operations	 	 	0.7	  	 	 	—	  	 	 	 		 	 	—	  	 	 	—	  	 	 	N.M.	  	 	 	N.M.	  	 	 	—	  	 	 	—	  	 	 	—	  	
Non-controlling interests	 	 	(2.4	) 	 	 	(0.4	) 	 	 	 		 	 	—	  	 	 	(0.4	) 	 	 	(83.3	) 	 	 	N.M.	  	 	 	—	  	 	 	—	  	 	 	—	  	
Profit/(loss) for the period attributable to equity holders of the parent	 	 	87.9	  	 	 	89.7	  	 	 	 		 	 	(56.6	) 	 	 	33.1	  	 	 	(62.3	) 	 	 	(46.0	) 	 	 	(4.0	) 	 	 	(112.1	) 	 	 	(90.6	) 	
Other financial data:	 				 				 	 	 		 				 				 				 				 				 				 				
EBITDA (1) (unaudited)	 	 	234.1	  	 	 	241.9	  	 	 	 		 	 	(34.9	) 	 	 	207.0	  	 	 	(11.6	) 	 	 	(0.1	) 	 	 	234.0	  	 	 	13.0	  	 	 	22.9	  	
Adjusted EBITDA (1) (unaudited)	 	 	246.9	  	 	 	235.9	  	 	 	 		 	 	32.2	  	 	 	268.1	  	 	 	8.6	  	 	 	21.5	  	 	 	295.1	  	 	 	10.1	  	 	 	16.9	  	

(1)	For a reconciliation to IFRS as issued by the IASB, see “Selected Historical Financial Information.”	
N.M.	means not meaningful.	
 
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 	  	Successor	 	 	 	 	 	 	 	
($ in millions)	  	For the six
months
ended
June 30,
2013	 	 	For the six
months
ended
June 30,
2014	 	 	Change
%	 	 	Change
excluding
FX
%	 	
 	  	(unaudited)	 	 	 	 	 	 	 	
Revenue	  	 	1,167.1	  	 	 	1,153.6	  	 	 	(1.2	) 	 	 	9.5	  	
Other operating income	  	 	0.6	  	 	 	0.9	  	 	 	50.0	  	 	 	50.0	  	
Own work capitalized	  	 	—	  	 	 	0.2	  	 	 	N.M.	  	 	 	N.M.	  	
Other gains	  	 	—	  	 	 	34.9	  	 	 	N.M.	  	 	 	N.M.	  	
Operating expenses:	  				 				 				 				
Supplies	  	 	(46.1	) 	 	 	(52.1	) 	 	 	13.0	  	 	 	27.1	  	
Employee benefit expense	  	 	(830.1	) 	 	 	(843.3	) 	 	 	1.6	  	 	 	12.4	  	
Depreciation and amortization	  	 	(66.0	) 	 	 	(61.6	) 	 	 	(6.7	) 	 	 	0.9	  	
Changes in trade provisions	  	 	2.2	  	 	 	(0.3	) 	 	 	N.M.	  	 	 	N.M.	  	
Other operating expenses	  	 	(192.0	) 	 	 	(167.1	) 	 	 	(13.0	) 	 	 	(4.2	) 	
Impairment charges	  	 	—	  	 	 	(32.9	) 	 	 	N.M.	  	 	 	N.M.	  	
Total operating expenses	  	 	(1,131.9	) 	 	 	(1,157.3	) 	 	 	2.2	  	 	 	12.6	  	
Operating profit	  	 	35.7	  	 	 	32.3	  	 	 	(9.5	) 	 	 	7.6	  	
Finance income	  	 	8.9	  	 	 	7.1	  	 	 	(20.2	) 	 	 	(9.0	) 	
Finance costs	  	 	(66.4	) 	 	 	(77.8	) 	 	 	17.2	  	 	 	21.8	  	
Net foreign exchange gain / (loss)	  	 	(3.4	) 	 	 	3.6	  	 	 	N.M.	  	 	 	N.M.	  	
Net finance expense	  	 	(60.9	) 	 	 	(67.1	) 	 	 	10.2	  	 	 	18.4	  	
Loss before tax	  	 	(25.2	) 	 	 	(34.8	) 	 	 	38.1	  	 	 	33.7	  	
Income tax benefit	  	 	2.1	  	 	 	10.5	  	 	 	N.M.	  	 	 	N.M.	  	
Loss for the period	  	 	(23.1	) 	 	 	(24.3	) 	 	 	5.2	  	 	 	6.5	  	
Loss for the period from continuing operations	  	 	(23.1	) 	 	 	(24.3	) 	 	 	5.2	  	 	 	6.5	  	
Loss after tax from discontinued operations	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Non-controlling interests	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Loss for the period attributable to equity holders of the parent	  	 	(23.1	) 	 	 	(24.3	) 	 	 	5.2	  	 	 	6.5	  	
Other financial data:	  				 				 				 				
EBITDA (1) (unaudited)	  	 	101.7	  	 	 	93.9	  	 	 	(7.7	) 	 	 	3.2	  	
Adjusted EBITDA (1) (unaudited)	  	 	123.9	  	 	 	131.6	  	 	 	6.2	  	 	 	16.1	  	

(1)	For a reconciliation to IFRS as issued by the IASB, see “Selected Historical Financial Information.”	
N.M. means not meaningful.
 
72

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The following charts sets forth a breakdown of selected income statement items for the periods presented for our operations in Brazil, the Americas and EMEA.

 	 	Predecessor	 	 	 	 	 	 	Successor	 	 	Non-IFRS
Aggregated	 	 	 	 	 	 	 	 	Successor	 	 	 	 	 	 	 	
($ in millions, except
percentage changes)	 	As of and
for the year
ended
December 31,
2011	 	 	As of and
for the
period
from Jan 1
– Nov 30,
2012	 	 	 	 	 	 	As of and
for the
period
from Dec 1
– Dec 31,
2012	 	 	For the year
ended
December 31,
2012	 	 	Change
%	 	 	Change
excluding
FX
%	 	 	As of and for
the year
ended
December 31,
2013	 	 	Change
%	 	 	Change
excluding
FX
%	 	
 	 	(unaudited)	 	 		 		 	(unaudited)	 	
Revenue:	 				 				 	 	 		 				 				 				 				 				 				 				
Brazil	 	 	1,343.1	  	 	 	1,116.8	  	 	 	 		 	 	96.3	  	 	 	1,213.1	  	 	 	(9.7	) 	 	 	5.3	  	 	 	1,206.1	  	 	 	(0.6	) 	 	 	9.6	  	
Americas	 	 	679.2	  	 	 	662.1	  	 	 	 		 	 	64.1	  	 	 	726.2	  	 	 	6.9	  	 	 	11.3	  	 	 	772.7	  	 	 	6.4	  	 	 	11.6	  	
EMEA	 	 	396.7	  	 	 	347.8	  	 	 	 		 	 	30.7	  	 	 	378.5	  	 	 	(4.6	) 	 	 	3.2	  	 	 	363.1	  	 	 	(4.1	) 	 	 	(7.0	) 	
Other and eliminations (1)	 	 	(1.7	) 	 	 	(0.8	) 	 	 	 		 	 	(0.2	) 	 	 	(1.0	) 	 	 	(41.2	) 	 	 	N.M.	  	 	 	(0.8	) 	 	 	(20.0	) 	 	 	N.M.	  	
Total revenue	 	 	2,417.3	  	 	 	2,125.9	  	 	 	 		 	 	190.9	  	 	 	2,316.8	  	 	 	(4.2	) 	 	 	6.7	  	 	 	2,341.1	  	 	 	1.0	  	 	 	7.5	  	
Operating expense:	 				 				 	 	 		 				 				 				 				 				 				 				
Brazil	 	 	(1,238.6	) 	 	 	(1,025.4	) 	 	 	 		 	 	(84.4	) 	 	 	(1,109.8	) 	 	 	(10.4	) 	 	 	4.4	  	 	 	(1,113.6	) 	 	 	0.3	  	 	 	10.6	  	
Americas	 	 	(615.5	) 	 	 	(602.6	) 	 	 	 		 	 	(52.4	) 	 	 	(655.0	) 	 	 	6.4	  	 	 	10.4	  	 	 	(705.9	) 	 	 	7.8	  	 	 	12.9	  	
EMEA	 	 	(373.7	) 	 	 	(319.3	) 	 	 	 		 	 	(28.9	) 	 	 	(348.2	) 	 	 	(6.8	) 	 	 	0.8	  	 	 	(365.2	) 	 	 	4.9	  	 	 	1.7	  	
Other and eliminations (1)	 	 	(41.1	) 	 	 	(16.7	) 	 	 	 		 	 	(69.4	) 	 	 	(86.1	) 	 	 	N.M.	  	 	 	N.M.	  	 	 	(56.7	) 	 	 	(34.1	) 	 	 	N.M.	  	
Total operating expenses	 	 	(2,268.9	) 	 	 	(1,964.0	) 	 	 	 		 	 	(235.1	) 	 	 	(2,199.1	) 	 	 	(3.1	) 	 	 	7.7	  	 	 	(2,241.4	) 	 	 	1.9	  	 	 	8.1	  	
Operating profit/(loss) :	 				 				 	 	 		 				 				 				 				 				 				 				
Brazil	 	 	108.2	  	 	 	91.2	  	 	 	 		 	 	12.3	  	 	 	103.5	  	 	 	(4.3	) 	 	 	11.9	  	 	 	94.8	  	 	 	(8.4	) 	 	 	1.0	  	
Americas	 	 	65.0	  	 	 	62.7	  	 	 	 		 	 	11.7	  	 	 	74.4	  	 	 	14.5	  	 	 	20.0	  	 	 	67.6	  	 	 	(9.1	) 	 	 	(4.6	) 	
EMEA	 	 	25.4	  	 	 	29.1	  	 	 	 		 	 	3.2	  	 	 	32.3	  	 	 	27.2	  	 	 	37.8	  	 	 	(0.1	) 	 	 	(100.3	) 	 	 	(100.3	) 	
Other and eliminations (1)	 	 	(43.0	) 	 	 	(19.2	) 	 	 	 		 	 	(69.6	) 	 	 	(88.8	) 	 	 	N.M.	  	 	 	N.M.	  	 	 	(57.3	) 	 	 	(35.5	) 	 	 	N.M.	  	
Total operating profit/(loss)	 	 	155.6	  	 	 	163.8	  	 	 	 		 	 	(42.4	) 	 	 	121.4	  	 	 	(22.0	) 	 	 	(10.3	) 	 	 	105.0	  	 	 	(13.5	) 	 	 	(1.2	) 	
Net finance expense :	 				 				 	 	 		 				 				 				 				 				 				 				
Brazil	 	 	(4.9	) 	 	 	(6.8	) 	 	 	 		 	 	(2.6	) 	 	 	(9.4	) 	 	 	91.8	  	 	 	N.M.	  	 	 	(43.9	) 	 	 	N.M.	  	 	 	N.M.	  	
Americas	 	 	(4.8	) 	 	 	(2.7	) 	 	 	 		 	 	(2.7	) 	 	 	(5.4	) 	 	 	12.5	  	 	 	22.9	  	 	 	(3.9	) 	 	 	(27.8	) 	 	 	0.0	  	
EMEA	 	 	(1.0	) 	 	 	(1.4	) 	 	 	 		 	 	(0.8	) 	 	 	(2.2	) 	 	 	N.M.	  	 	 	N.M.	  	 	 	(18.4	) 	 	 	N.M.	  	 	 	N.M.	  	
Other and eliminations (1)	 	 	(0.4	) 	 	 	(2.0	) 	 	 	 		 	 	(0.0	) 	 	 	(2.0	) 	 	 	N.M.	  	 	 	N.M.	  	 	 	(34.5	) 	 	 	N.M.	  	 	 	N.M.	  	
Total net finance expense	 	 	(11.1	) 	 	 	(12.9	) 	 	 	 		 	 	(6.0	) 	 	 	(19.0	) 	 	 	71.2	  	 	 	95.5	  	 	 	(100.7	) 	 	 	N.M.	  	 	 	N.M.	  	
Income tax expense:	 				 				 	 	 		 				 				 				 				 				 				 				
Brazil	 	 	(29.3	) 	 	 	(25.9	) 	 	 	 		 	 	27.5	  	 	 	1.6	  	 	 	N.M.	  	 	 	N.M.	  	 	 	(17.7	) 	 	 	N.M.	  	 	 	N.M.	  	
Americas	 	 	(16.0	) 	 	 	(25.9	) 	 	 	 		 	 	(0.2	) 	 	 	(26.1	) 	 	 	63.1	  	 	 	68.1	  	 	 	(19.3	) 	 	 	(26.1	) 	 	 	(23.0	) 	
EMEA	 	 	(6.9	) 	 	 	(8.2	) 	 	 	 		 	 	(0.6	) 	 	 	(8.8	) 	 	 	27.5	  	 	 	39.1	  	 	 	7.8	  	 	 	N.M.	  	 	 	N.M.	  	
Other and eliminations (1)	 	 	(2.7	) 	 	 	(0.7	) 	 	 	 		 	 	(34.8	) 	 	 	(35.5	) 	 	 	N.M.	  	 	 	N.M.	  	 	 	20.9	  	 	 	N.M.	  	 	 	N.M.	  	
Total income tax expense	 	 	(54.9	) 	 	 	(60.7	) 	 	 	 		 	 	(8.1	) 	 	 	(68.8	) 	 	 	25.3	  	 	 	27.5	  	 	 	(8.3	) 	 	 	(87.9	) 	 	 	(82.7	) 	
Profit/(loss) for the period:	 				 				 	 	 		 				 				 				 				 				 				 				
Brazil	 	 	74.1	  	 	 	58.6	  	 	 	 		 	 	37.3	  	 	 	95.9	  	 	 	29.4	  	 	 	54.1	  	 	 	33.2	  	 	 	(65.4	) 	 	 	(61.8	) 	
Americas	 	 	44.2	  	 	 	34.1	  	 	 	 		 	 	8.8	  	 	 	42.9	  	 	 	(2.9	) 	 	 	2.3	  	 	 	44.4	  	 	 	3.5	  	 	 	6.1	  	
EMEA	 	 	18.2	  	 	 	19.5	  	 	 	 		 	 	1.7	  	 	 	21.2	  	 	 	16.5	  	 	 	26.4	  	 	 	(10.7	) 	 	 	N.M.	  	 	 	N.M.	  	
Other and eliminations (1)	 	 	(46.2	) 	 	 	(22.0	) 	 	 	 		 	 	(104.4	) 	 	 	(126.4	) 	 	 	N.M.	  	 	 	N.M.	  	 	 	(70.9	) 	 	 	(43.9	) 	 	 	N.M.	  	
Total profit/(loss) for the period	 	 	90.3	  	 	 	90.2	  	 	 	 		 	 	(56.6	) 	 	 	33.6	  	 	 	(62.8	) 	 	 	(47.0	) 	 	 	(4.0	) 	 	 	N.M.	  	 	 	(90.8	) 	
Other Financial Data:	 				 				 	 	 		 				 				 				 				 				 				 				
EBITDA (2) :	 				 				 	 	 		 				 				 				 				 				 				 				
Brazil	 	 	145.7	  	 	 	126.9	  	 	 	 		 	 	15.7	  	 	 	142.7	  	 	 	(2.1	) 	 	 	14.4	  	 	 	150.7	  	 	 	5.6	  	 	 	16.5	  	
Americas	 	 	95.1	  	 	 	92.2	  	 	 	 		 	 	14.5	  	 	 	106.7	  	 	 	12.2	  	 	 	17.1	  	 	 	115.3	  	 	 	8.1	  	 	 	11.7	  	
EMEA	 	 	34.1	  	 	 	41.4	  	 	 	 		 	 	4.4	  	 	 	45.8	  	 	 	34.3	  	 	 	45.5	  	 	 	24.3	  	 	 	(46.9	) 	 	 	(48.7	) 	
Other and eliminations (1)	 	 	(40.7	) 	 	 	(18.6	) 	 	 	 		 	 	(69.6	) 	 	 	(88.2	) 	 	 	N.M.	  	 	 	N.M.	  	 	 	(56.3	) 	 	 	(36.2	) 	 	 	N.M.	  	
Total EBITDA (unaudited)	 	 	234.1	  	 	 	241.9	  	 	 	 		 	 	(34.9	) 	 	 	207.0	  	 	 	(11.6	) 	 	 	(0.1	) 	 	 	234.0	  	 	 	13.0	  	 	 	22.9	  	
Adjusted EBITDA (2) :	 				 				 	 	 		 				 				 				 				 				 				 				
Brazil	 	 	141.3	  	 	 	128.7	  	 	 	 		 	 	16.4	  	 	 	145.1	  	 	 	2.7	  	 	 	19.8	  	 	 	161.1	  	 	 	11.0	  	 	 	21.4	  	
Americas	 	 	95.1	  	 	 	94.2	  	 	 	 		 	 	19.2	  	 	 	113.4	  	 	 	19.2	  	 	 	24.7	  	 	 	118.4	  	 	 	4.4	  	 	 	7.8	  	
EMEA	 	 	32.9	  	 	 	31.4	  	 	 	 		 	 	3.9	  	 	 	35.3	  	 	 	7.3	  	 	 	16.1	  	 	 	26.7	  	 	 	(24.4	) 	 	 	(26.6	) 	
Other and eliminations (1)	 	 	(22.4	) 	 	 	(18.4	) 	 	 	 		 	 	(7.3	) 	 	 	(25.7	) 	 	 	14.7	  	 	 	N.M.	  	 	 	(11.1	) 	 	 	(56.8	) 	 	 	N.M.	  	
Total Adjusted EBITDA (unaudited)	 	 	246.9	  	 	 	235.9	  	 	 	 		 	 	32.2	  	 	 	268.1	  	 	 	8.6	  	 	 	21.5	  	 	 	295.1	  	 	 	10.1	  	 	 	16.9	  	

(1)	Includes holding company level revenue and expenses (such as corporate expenses and Acquisition related expenses), as applicable, as well as consolidation adjustments.	
(2)	For a reconciliation to IFRS as issued by the IASB, see Note 20 to the Predecessor financial statements and Note 23 to the Successor financial statements.	
N.M.	means not meaningful.	
 
73

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 	  	Successor	 	 	 	 	 	 	 	
 	  	For the six months
ended June 30,	 	 	Change
%	 	 	Change
excluding
FX
%	 	
($ in millions)	  	2013	 	 	2014	 	 			 			
 	  	(unaudited)	 	 	 	 	 	 	 	
Revenue:	  				 				 				 				
Brazil	  	 	606.5	  	 	 	598.5	  	 	 	(1.3	) 	 	 	11.4	  	
Americas	  	 	375.3	  	 	 	372.3	  	 	 	(0.8	) 	 	 	13.8	  	
EMEA	  	 	185.6	  	 	 	183.1	  	 	 	(1.3	) 	 	 	(5.3	) 	
Other and eliminations (1)	  	 	(0.3	) 	 	 	(0.3	) 	 	 	—	  	 	 	(33.3	) 	
Total revenue	  	 	1,167.1	  	 	 	1,153.6	  	 	 	(1.2	) 	 	 	9.5	  	
Operating expense:	  				 				 				 				
Brazil	  	 	(570.7	) 	 	 	(556.5	) 	 	 	(2.5	) 	 	 	10.1	  	
Americas	  	 	(352.0	) 	 	 	(348.9	) 	 	 	(0.9	) 	 	 	14.9	  	
EMEA	  	 	(184.7	) 	 	 	(234.5	) 	 	 	27.0	  	 	 	21.9	  	
Other and eliminations (1)	  	 	(24.5	) 	 	 	(17.4	) 	 	 	(29.0	) 	 	 	(31.8	) 	
Total operating expenses	  	 	(1,131.9	) 	 	 	(1,157.3	) 	 	 	2.2	  	 	 	12.6	  	
Operating profit/(loss) :	  				 				 				 				
Brazil	  	 	36.0	  	 	 	42.2	  	 	 	17.2	  	 	 	32.2	  	
Americas	  	 	23.4	  	 	 	23.8	  	 	 	1.7	  	 	 	(0.4	) 	
EMEA	  	 	1.2	  	 	 	(50.4	) 	 	 	N.M.	  	 	 	N.M.	  	
Other and eliminations (1)	  	 	(24.9	) 	 	 	16.7	  	 	 	N.M.	  	 	 	N.M.	  	
Total operating profit/(loss)	  	 	35.7	  	 	 	32.3	  	 	 	(9.5	) 	 	 	7.6	  	
Net finance expense :	  				 				 				 				
Brazil	  	 	(23.3	) 	 	 	(27.8	) 	 	 	19.3	  	 	 	34.8	  	
Americas	  	 	(6.0	) 	 	 	(2.4	) 	 	 	(60.0	) 	 	 	(10.0	) 	
EMEA	  	 	(11.3	) 	 	 	(7.0	) 	 	 	(38.1	) 	 	 	(40.7	) 	
Other and eliminations (1)	  	 	(20.3	) 	 	 	(29.9	) 	 	 	47.3	  	 	 	40.9	  	
Total net finance expense	  	 	(60.9	) 	 	 	(67.1	) 	 	 	10.2	  	 	 	18.4	  	
Income tax benefit:	  				 				 				 				
Brazil	  	 	(4.3	) 	 	 	(4.8	) 	 	 	11.6	  	 	 	25.6	  	
Americas	  	 	(10.4	) 	 	 	(7.7	) 	 	 	(26.0	) 	 	 	(27.9	) 	
EMEA	  	 	6.7	  	 	 	16.3	  	 	 	N.M.	  	 	 	N.M.	  	
Other and eliminations (1)	  	 	10.1	  	 	 	6.8	  	 	 	(32.7	) 	 	 	(36.6	) 	
Total income tax benefit	  	 	2.1	  	 	 	10.5	  	 	 	N.M.	  	 	 	N.M.	  	
Profit/(loss) for the period:	  				 				 				 				
Brazil	  	 	8.4	  	 	 	9.6	  	 	 	14.3	  	 	 	28.6	  	
Americas	  	 	7.1	  	 	 	13.6	  	 	 	91.5	  	 	 	46.5	  	
EMEA	  	 	(3.4	) 	 	 	(41.2	) 	 	 	N.M.	  	 	 	N.M.	  	
Other and eliminations (1)	  	 	(35.2	) 	 	 	(6.3	) 	 	 	(82.1	) 	 	 	(82.7	) 	
Loss for the period	  	 	(23.1	) 	 	 	(24.3	) 	 	 	5.2	  	 	 	6.5	  	
Other financial data:	  				 				 				 				
EBITDA (2) :	  				 				 				 				
Brazil	  	 	65.8	  	 	 	70.0	  	 	 	6.4	  	 	 	20.1	  	
Americas	  	 	47.3	  	 	 	45.4	  	 	 	(4.0	) 	 	 	(0.8	) 	
EMEA	  	 	13.2	  	 	 	(38.8	) 	 	 	N.M.	  	 	 	N.M.	  	
Other and eliminations (1)	  	 	(24.5	) 	 	 	17.3	  	 	 	N.M.	  	 	 	N.M.	  	
Total EBITDA (unaudited)	  	 	101.7	  	 	 	93.9	  	 	 	(7.7	) 	 	 	3.2	  	
Adjusted EBITDA (2) :	  				 				 				 				
Brazil	  	 	67.9	  	 	 	76.9	  	 	 	13.3	  	 	 	27.8	  	
Americas	  	 	49.0	  	 	 	49.6	  	 	 	1.2	  	 	 	6.3	  	
EMEA	  	 	13.4	  	 	 	10.9	  	 	 	(18.7	) 	 	 	(21.6	) 	
Other and eliminations (1)	  	 	(6.4	) 	 	 	(5.8	) 	 	 	(9.4	) 	 	 	(12.5	) 	
Total Adjusted EBITDA (unaudited)	  	 	123.9	  	 	 	131.6	  	 	 	6.2	  	 	 	16.1	  	

(1)	Includes holding company level revenue and expenses (such as corporate expenses and Acquisition related expenses), as applicable, as well as consolidation adjustments.	
(2)	For a reconciliation to IFRS as issued by the IASB, see Note 6 to the Interim financial statements.	
N.M. means not meaningful.
 
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Year Ended December 31, 2012 Compared to Year Ended December 31, 2013
Revenue
Revenue increased by $24.3 million, or 1.0%, from $2,316.8 million for the year ended December 31, 2012 to $2,341.1 million for the year ended December 31, 2013. Excluding the impact of foreign exchange, revenue increased by 7.5%. Excluding the impact of foreign exchange, revenue from Telefónica Group companies increased by 4.7%, driven primarily by strong performance in Brazil and the Americas, which was partially offset by adverse macro-economic conditions in Spain. Revenue from non-Telefónica clients increased by 10.3%, excluding the impact of foreign exchange, principally due to strong market growth in Brazil and the Americas and contract wins with existing and new customers.
The following chart sets forth a breakdown of revenue based on geographical region for the years ended December 31, 2012 and December 31, 2013 and as a percentage of total revenue and the percentage change between periods and net of foreign exchange effects.

 	  	For the year ended December 31,	 	
 	  	Non-IFRS
Aggregated
2012
(unaudited)	 	  	2013
(Successor)	 	  	Change	 	 	Change
excluding
FX	 	
 	  	$	 	 	(%)	 	  	$	 	 	(%)	 	  	(%)	 	 	(%)	 	
($ in millions)	  	 	 	 	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Brazil	  	 	1,213.1	  	 	 	52.4	  	  	 	1,206.1	  	 	 	51.5	  	  	 	(0.6	) 	 	 	9.6	  	
Americas	  	 	726.2	  	 	 	31.3	  	  	 	772.7	  	 	 	33.0	  	  	 	6.4	  	 	 	11.6	  	
EMEA	  	 	378.5	  	 	 	16.3	  	  	 	363.1	  	 	 	15.5	  	  	 	(4.1	) 	 	 	(7.0	) 	
Other and eliminations (1)	  	 	(1.0	) 	 	 	—	  	  	 	(0.8	) 	 	 	—	  	  	 	(20.0	) 	 	 	N.M.	  	
Total	  	 	2,316.8	  	 	 	100	  	  	 	2,341.1	  	 	 	100	  	  	 	1.0	  	 	 	7.5	  	

(1)	Includes holding company level revenues and consolidation adjustments.	
Brazil
Revenue in Brazil for the years ended December 31, 2012 and December 31, 2013 was $1,213.1 million and $1,206.1 million, respectively. Revenue decreased in Brazil by $7.0 million, or 0.6%. Excluding the impact of foreign exchange, revenue increased by 9.6%. Excluding the impact of foreign exchange, revenue from Telefónica Group companies increased by 9.9%, principally due to increases in the price of our services, volume growth in existing services, and the introduction of new services. Revenue from non-Telefónica clients increased by 9.4%, excluding the impact of foreign exchange, principally attributable to price increases, volume growth in existing services, the introduction of new services, primarily in the financial sector, and new customers in the telecommunications and financial sectors.
Americas
Revenue in the Americas for the years ended December 31, 2012 and December 31, 2013 was $726.2 million and $772.7 million, respectively. Revenue increased in the Americas by $46.5 million, or 6.4%. Excluding the impact of foreign exchange, revenue increased by 11.6%. Excluding the impact of foreign exchange, revenue from Telefónica Group companies increased by 8.5%, with solid performance in most markets, which was partially offset by a decrease in revenue in Chile as a result of the implementation of a new service delivery model by Telefónica during 2012 and 2013. Excluding the impact of foreign exchange, revenue from non-Telefónica clients increased by 14.8% with a strong performance across all markets.
EMEA
Revenue in EMEA for the years ended December 31, 2012 and December 31, 2013 was $378.5 million and $363.1 million, respectively. Revenue decreased in EMEA by $15.4 million, or 4.1%. Excluding the impact of
 
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foreign exchange, revenue decreased by 7.0%. Excluding the impact of foreign exchange, revenue from Telefónica Group companies decreased by 10.8% principally due to a decrease in volume of sales in Spain, driven by adverse macro-economic conditions. Excluding the impact of foreign exchange, revenue from non-Telefónica clients increased by 1.7% driven by the expansion of multi-sector private clients.
Other operating income
Other operating income increased by $0.7 million, or 18.9%, from $3.7 million for the year ended December 31, 2012 to $4.4 million for the year ended December 31, 2013. Excluding the impact of foreign exchange, other operating income increased by 21.6%, principally due to income derived from insurance recovery in Brazil.
Total operating expenses
Total operating expenses increased by $42.3 million, or 1.9%, from $2,199.1 million for the year ended December 31, 2012 to $2,241.4 million for the year ended December 31, 2013. Excluding the impact of foreign exchange, operating expenses increased by 8.1%, principally due to increases in employee benefit expenses and to greater depreciation and amortization expense. As a percentage of revenue, operating expenses constituted 94.9% and 95.7% for the years ended December 31, 2012 and 2013, respectively.
The $42.3 million increase in operating expenses resulted from the following components:
Supplies: Supplies increased by $1.4 million, or 1.2%, from $113.9 million for the year ended December 31, 2012 to $115.3 million for the year ended December 31, 2013. Excluding the impact of foreign exchange, supplies expense increased by 6.8%, principally as a result of general growth in our business. As a percentage of revenue, supplies constituted 4.9% for each of the years ended December 31, 2012 and 2013.
Employee benefits expenses: Employee benefits expenses increased by $34.0 million, or 2.1%, from $1,609.5 million for the year ended December 31, 2012 to $1,643.5 million for the year ended December 31, 2013. As a percentage of our revenue, employee benefits expenses constituted 69.5% and 70.2% for the years ended December 31, 2012 and December 31, 2013, respectively. Excluding the impact of foreign exchange, employee benefits expenses increased by 8.5%. Adjusting for restructuring expenses between 2013 and 2012 of $12.8 million and $8.6 million, respectively, and the positive impact in 2012 of the release of an employee benefit accrual of $11.3 million following the better-than-expected outcome of the collective bargaining agreement negotiation in Spain, employee benefits expenses increased by 7.5% in constant currency, which was broadly in line with the increase in revenue. This increase in employee benefits expenses was principally due to the growth of our business, as we increased the average number of employees from 150,248 in 2012 to 155,832 in 2013, or 3.7%, as well as higher wages.
Depreciation and amortization: Depreciation and amortization expense increased by $43.4 million, or 50.7%, from $85.6 million for the year ended December 31, 2012 to $129.0 million for the year ended December 31, 2013. Excluding the impact of foreign exchange, depreciation and amortization expense increased by 57.0%, principally due to a $40.7 million increase in amortization charges derived from the recognition of customer relationship intangible assets in connection with the Acquisition.
Changes in trade provisions: Changes in trade provisions improved by $13.1 million, from a negative change of $11.1 million for the year ended December 31, 2012 to positive change of $2.0 million for the year ended December 31, 2013, principally due to improved collections on receivables we had previously impaired. As a percentage of revenue, changes in trade provisions constituted 0.5% and (0.1)% for the years ended December 31, 2012 and 2013, respectively.
Other operating expenses: Other operating expenses decreased by $23.4 million, or 6.2%, from $379.0 million for the year ended December 31, 2012 to $355.6 million for the year ended December 31, 2013. Excluding the impact of foreign exchange, other operating expenses decreased by 0.6%, principally due to
 
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(i) expenses recorded in 2012 related to the Acquisition, which amounted to $62.6 million and did not recur in 2013; (ii) general cost efficiencies and savings in most of the countries in which we operate; and (iii) which were partially offset by integration-related costs, including consultancy and professional fees, associated with the change of ownership of the Atento Group, amounting to $27.9 million. We had $124.6 million in expenses for operating leases for the year ended December 31, 2012 as compared to $118.3 million in expenses for operating leases for the year ended December 31, 2013. As a percentage of revenue, other operating expenses constituted 16.4% and 15.2% for the years ended December 31, 2012 and 2013, respectively.
Brazil
Total operating expenses in Brazil increased $3.8 million, or 0.3%, from $1,109.8 million for the year ended December 31, 2012 to $1,113.6 million for the year ended December 31, 2013. Excluding the impact of foreign exchange, operating expenses in Brazil increased by 10.6%. Operating expenses as a percentage of revenue in Brazil increased from 91.5% to 92.3%. This increase was principally due to increased amortization charges derived from the recognition of customer relationship intangible assets in connection with the Acquisition by approximately $18.9 million or 1.6% of revenues.
Americas
Total operating expenses in the Americas increased $50.9 million, or 7.8%, from $655.0 million for the year ended December 31, 2012 to $705.9 million for the year ended December 31, 2013. Excluding the impact of foreign exchange, operating expenses in the Americas increased by 12.9%. Operating expenses as a percentage of revenue increased in the Americas from 90.2% to 91.4%. The increase in operating expenses as a percentage of revenue in the Americas was principally due to an increase in the amortization charges of $12.2 million derived from the recognition of customer relationship intangible assets in connection with the Acquisition. This increase in 2013 was partially offset by severance payments of senior management in Mexico incurred in the amount of $2.2 million in 2012, which did not recur during 2013.
EMEA
Total operating expenses in EMEA increased by $17.0 million, or 4.9%, from $348.2 million for the year ended December 31, 2012 to $365.2 million for the year ended December 31, 2013. Excluding the impact of foreign exchange, operating expenses in EMEA increased by 1.7%. Operating expenses as a percentage of revenue in EMEA increased from 92.0% to 100.6% as a result of declining revenues mainly in Spain with Telefónica and increase in amortization of intangibles of $9.5 million. Excluding this impact, operating expenses as a percentage of revenue in EMEA represented 98.0%.
Operating profit
Operating profit decreased by $16.4 million, or 13.5%, from $121.4 million for the year ended December 31, 2012 to $105.0 million for the year ended December 31, 2013. Excluding the impact of foreign exchange, operating profit decreased by 1.2%. As a percentage of revenue, operating profit margin decreased from 5.2% for the year ended December 31, 2012 to 4.5% for the year ended December 31, 2013 primarily driven by the increased amortization charges derived from the recognition of customer relationship intangible assets in connection with the Acquisition for $40.7 million. Excluding this impact, operating profit margin would have increased to 6.2%, driven mainly by continued focus on reducing fixed costs and expenses recorded in 2012 related to the Acquisition which did not recur in 2013, partially offset by our integration costs in 2013.
Brazil
Operating profit in Brazil decreased by $8.7 million, or 8.4%, from $103.5 million for the year ended December 31, 2012 to $94.8 million for the year ended December 31, 2013. Excluding the impact of foreign exchange, operating profit increased by 1.0%. Operating profit margin in Brazil decreased from 8.5% for the year ended December 31, 2012 to 7.9% for the year ended December 31, 2013. The decrease in operating profit
 
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margin in Brazil was principally due to increased amortization charges associated with the customer portfolio intangible assets recognized in connection with the Acquisition. Excluding this impact, operating profit margin would have increased to 9.4% in 2013.
Americas
Operating profit in the Americas decreased by $6.8 million, or 9.1%, from $74.4 million for the year ended December 31, 2012 to $67.6 million for the year ended December 31, 2013. Excluding the impact of foreign exchange, operating profit in the Americas decreased by 4.6%. Operating profit margin in the Americas decreased from 10.2% for the year ended December 31, 2012 to 8.7% for the year ended December 31, 2013. The decrease in operating profit margin in Americas was principally attributable to increased amortization charges associated with the customer portfolio intangible assets recognized in connection with the Acquisition. Excluding this impact, operating profit margin would have increased to 10.3% in 2013, in line with 2012 operating profit margin.
EMEA
Operating profit in EMEA decreased by $32.4 million, or 100.3%, from $32.3 million for the year ended December 31, 2012 to $(0.1) million for the year ended December 31, 2013. Excluding the impact of foreign exchange, operating profit decreased by 100.3%. Operating profit margin in EMEA decreased from 8.5% for the year ended December 31, 2012 to no margin for the year ended December 31, 2013. The decrease in operating profit in EMEA was principally due to the decrease in the volume of sales to Telefónica due to adverse macro-economic conditions in Spain and the increased amortization charges associated with the client portfolio intangible assets recognized in connection with the Acquisition. Excluding this impact, operating profit margin in 2013 would have decreased to 2.6%.
Finance income
Finance income increased by $3.6 million, or 25.4%, from $14.2 million for the year ended December 31, 2012 to $17.8 million for the year ended December 31, 2013. Excluding the impact of foreign exchange, finance income increased by 32.4%. This increase is principally due to an increase in cash, deposits and short term financial investments.
Finance costs
Finance costs increased by $102.9 million, from $32.2 million for the year ended December 31, 2012 to $135.1 million for the year ended December 31, 2013. This increase is principally due to higher interest costs in connection with the Acquisition related financings and changes in fair value of hedge instruments.
Net foreign exchange gain/(loss)
Net foreign exchange gain/(loss) increased by $17.6 million, from a loss of $1.0 million for the year ended December 31, 2012 to a gain of $16.6 million for the year ended December 31, 2013. This increase is principally due to exchange gains from liabilities denominated in foreign currency held by certain intermediate holding companies as a result of the depreciation of these currencies against the U.S. dollar.
Income tax expense
Income tax expense for the years ended December 31, 2012 and December 31, 2013 was $68.8 million and $8.3 million, respectively, decreasing by $60.5 million, or 87.9%. Excluding the impact of foreign exchange, income tax expense decreased by 82.7% primarily as a result of the tax deductibility of goodwill amortization in Brazil and interest expenses. The aggregate effective tax rate in both 2013 and 2012 is distorted because of the contribution of losses in the holding companies to our profit before tax. Adjusting for this effect, the aggregate rate excluding the Group’s holding companies in 2013 is 30% compared to 33% for the year ended December 31, 2012.
 
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Profit/(loss) for the period
Profit/(loss) for the years ended December 31, 2012 and December 31, 2013 was $33.6 million and $(4.0) million, respectively. Excluding the impact of foreign exchange, profit margin decreased from 1.5% in 2012 to 0.1% in 2013 as a result of the factors discussed above.
EBITDA and Adjusted EBITDA
EBITDA increased by $27.0 million, or 13.0%, from $207.0 million for the year ended December 31, 2012 to $234.0 million for the year ended December 31, 2013. Adjusted EBITDA increased by $27.0 million, or 10.1%, from $268.1 million for the year ended December 31, 2012 to $295.1 million for the year ended December 31, 2013. Additionally, the increase in EBITDA in 2013 is positively higher than in 2012, impacted by the decrease in Acquisition and integration related costs from $62.6 million in 2012 to $29.3 million in 2013. The difference between EBITDA and Adjusted EBITDA is due to the exclusion of items that are not related to our core results of operations. Adjusted EBITDA is defined as EBITDA adjusted to exclude Acquisition and integration related costs, restructuring costs, sponsor management fees, asset impairments, site relocation costs, financing fees, and other items which are not related to our core results of operations. See the “Selected Historical Financial Information” section for reconciliation of EBITDA and Adjusted EBITDA to profit/(loss).
Excluding the impact of foreign exchange, EBITDA and Adjusted EBITDA increased by 22.9% and 16.9%, respectively. The increase in EBITDA and Adjusted EBITDA is principally due to the growth in revenue and cost efficiencies in many of the countries in which we operate.
Brazil
EBITDA in Brazil increased by $8.0 million, or 5.6%, from $142.7 million for the year ended December 31, 2012 to $150.7 million for the year ended December 31, 2013. Adjusted EBITDA in Brazil increased by $16.0 million, or 11.0%, from $145.1 million for the year ended December 31, 2012 to $161.1 million for the year ended December 31, 2013. Excluding the impact of foreign exchange, EBITDA and Adjusted EBITDA increased by 16.5% and 21.4%, respectively. The increase in EBITDA is principally due to the growth in revenue.
Americas
EBITDA in Americas increased by $8.6 million, or 8.1%, from $106.7 million for the year ended December 31, 2012 to $115.3 million for the year ended December 31, 2013. Adjusted EBITDA in Americas increased by $5.0 million, or 4.4%, from $113.4 million for the year ended December 31, 2012 to $118.4 million for the year ended December 31, 2013. Excluding the impact of foreign exchange, EBITDA and Adjusted EBITDA increased by 11.7% and 7.8%, respectively. The increase in EBITDA and Adjusted EBITDA is principally due to the growth in revenue and cost efficiencies. Additionally, the growth in EBITDA in 2013 is positively influenced by the decrease in costs related to the Acquisition.
EMEA
EBITDA in EMEA decreased by $21.5 million, or 46.9%, from $45.8 million for the year ended December 31, 2012 to $24.3 million for the year ended December 31, 2013. Adjusted EBITDA in EMEA decreased by $8.6 million, or 24.4%, from $35.3 million for the year ended December 31, 2012 to $26.7 million for the year ended December 31, 2013. Excluding the impact of foreign exchange, EBITDA and Adjusted EBITDA decreased by 48.7% and 26.6%, respectively. The decrease in EBITDA is principally due to the positive impact in 2012 of the release of an employee benefit accrual of $11.3 million following the better-than-expected outcome of the collective bargaining agreement negotiation in Spain, which did not recur in 2013, as well as reduced work volume with Telefónica.
 
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Year Ended December 31, 2012 Compared to the Year Ended December 31, 2011
Revenue
Revenue decreased by $100.5 million, or 4.2%, from $2,417.3 million for the year ended December 31, 2011 to $2,316.8 million for the year ended December 31, 2012. Excluding the impact of foreign exchange, revenue increased by 6.7%. Excluding the impact of foreign exchange, revenue from Telefónica companies increased by 3.8%, driven primarily by solid performance in the Americas, partially offset by adverse economic conditions in Spain. Excluding the impact of foreign exchange, revenue from non-Telefónica clients increased by 9.7%, principally due to strong growth in Brazil and the full year impact of owning the directory business in Spain, acquired from Telefónica in September 2011.
The following chart sets forth a breakdown of revenue based on geographical region for the years ended December 31, 2011 and December 31, 2012 and as a percentage of revenue and the percentage change between those periods with and net of foreign exchange effects.

 	  	For the year ended December 31,	 	
 	  	2011
(Predecessor)	 	 	Non-IFRS
Aggregated
2012
(unaudited)	 	  	Change	 	 	Change
excluding
FX	 	
 	  	$	 	 	(%)	 	 	$	 	 	    (%)    	 	  	(%)	 	 	(%)	 	
($ in millions, except percentage changes)	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	
Brazil	  	 	1,343.1	  	 	 	55.6	  	 	 	1,213.1	  	 	 	52.4	  	  	 	(9.7	) 	 	 	5.3	  	
Americas	  	 	679.2	  	 	 	28.1	  	 	 	726.2	  	 	 	31.3	  	  	 	6.9	  	 	 	11.3	  	
EMEA	  	 	396.7	  	 	 	16.4	  	 	 	378.5	  	 	 	16.3	  	  	 	(4.6	) 	 	 	3.2	  	
Other and eliminations (1)	  	 	(1.7	) 	 	 	(0.1	) 	 	 	(1.0	) 	 	 	—	  	  	 	(41.2	) 	 	 	N.M.	  	
Total	  	 	2,417.3	  	 	 	100	  	 	 	2,316.8	  	 	 	100	  	  	 	(4.2	) 	 	 	6.7	  	

(1)	Includes holding company level revenues and consolidation adjustments.	
Brazil
Revenue in Brazil for the years ended December 31, 2011 and December 31, 2012 was $1,343.1 million and $1,213.1 million, respectively. Revenue decreased in Brazil by $130.0 million, or 9.7%. Excluding the foreign exchange impact, revenue increased by 5.3% over this period. Excluding the impact of foreign exchange, revenue from Telefónica companies decreased by 2.3%, principally due to price reductions in the fourth quarter of 2011 while under Telefónica ownership, which impacted results in 2012. Revenue from non-Telefónica clients, excluding the impact of foreign exchange, increased by 11.9% over this period, principally due to price increases, volume growth and the introduction of new services, primarily in the financial services sector.
Americas
Revenue in the Americas for the years ended December 31, 2011 and December 31, 2012 was $679.2 million and $726.2 million, respectively. Revenue increased in the Americas by $47.0 million, or 6.9%. Excluding the impact of foreign exchange, revenue increased by 11.3%. Excluding the impact of foreign exchange, revenue from Telefónica companies increased by 20.9% over this period with growth in most markets, except in Chile, which decreased primarily as a result of the implementation of a new service delivery model by Telefónica during 2012. Excluding the impact of foreign exchange, revenue from non-Telefónica clients increased by 2.8%.
EMEA
Revenue in EMEA for the years ended December 31, 2011 and December 31, 2012 was $396.7 million and $378.5 million, respectively. Revenue decreased in EMEA by $18.2 million, or 4.6%. Excluding the foreign
 
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exchange impact, revenue increased by 3.2%. Excluding the foreign exchange impact, revenue from Telefónica companies decreased by 2.0% principally due to a decrease in volume of sales in Spain, driven by adverse macro-economic conditions. Revenue from non-Telefónica clients increased by 17.6%, excluding the impact of foreign exchange, principally due to the revenue impact of the directory business acquired from Telefónica in September 2011.
Other operating income
Other operating income decreased by $3.5 million, or 48.6%, from $7.2 million for the year ended December 31, 2011 to $3.7 million for the year ended December 31, 2012. Excluding the impact of foreign exchange, other operating income decreased by 44.4%, principally due to income from the disposal of fixed assets in 2011 which did not recur in 2012.
Total operating expenses
Total operating expenses decreased by $69.8 million, or 3.1%, from $2,268.9 million for the year ended December 31, 2011 to $2,199.1 million for the year ended December 31, 2012. Excluding the impact of foreign exchange, operating expenses increased by 7.7%. As a percentage of revenue, operating expenses constituted 93.9% and 94.9% for the year ended December 31, 2011 and 2012, respectively. This increase is principally due to expenses related to the Acquisition in 2012 of $62.6 million, partially offset by the positive impact in 2012 of the release of an employee benefit accrual of $11.3 million following the better-than-expected outcome of the collective bargaining agreement negotiation in Spain. Adjusting for both of these items operating expenses as a percentage of revenues would have constituted 92.7%, a decrease of 2.2%.
The $69.8 million decrease in operating expenses resulted from the following components:
Supplies: Supplies decreased by $15.9 million, or 12.2%, from $129.8 million for the year ended December 31, 2011 to $113.9 million for the year ended December 31, 2012. Excluding the impact of foreign exchange, supplies expense decreased by 2.3%. This decrease is principally driven by declining costs of leasing workspaces at service delivery centers owned by our clients. As a percentage of revenue, supplies constituted 5.4% and 4.9% for the year ended December 31, 2011 and 2012, respectively.
Employee benefits expenses: Employee benefits expenses decreased by $92.4 million, or 5.4%, from $1,701.9 million for the year ended December 31, 2011 to $1,609.5 million for the year ended December 31, 2012. Excluding the impact of foreign exchange, employee benefits expenses increased by 5.1%. This increase in employee benefits expenses was principally due to the growth of our business, as we increased the average number of employees from 147,042 to 150,248, or 2.2%, and wage inflation, partially offset by the benefit of Plano Brasil Maior tax exemption. This increase was partially offset by the positive impact in 2012 of the release of an employee benefit accrual of $11.3 million following the better-than-expected outcome of the collective bargaining agreement negotiation in Spain. As a percentage of our revenue, employee benefits expenses constituted 70.4% and 69.5% for the years ended December 31, 2011 and December 31, 2012, respectively.
Depreciation and amortization: Depreciation and amortization expense increased by $7.1 million, or 9.0%, from $78.5 million for the year ended December 31, 2011 to $85.6 million for the year ended December 31, 2012. Excluding the impact of foreign exchange, depreciation and amortization expense increased by 20.1%, principally due to the full year impact of the acquisition of a directory business from Telefónica in September 2011, as well as additional investments.
Changes in trade provisions: Changes in trade provisions increased by $8.4 million, from a negative change of $2.7 million for the year ended December 31, 2011 to a negative change of $11.1 million for the year ended December 31, 2012. This increase was principally due to the introduction in connection with the Acquisition of a more conservative policy for impairment of trade receivables in 2012. As a percentage of revenue, changes in trade provisions constituted 0.1% and 0.5% for the year ended December 31, 2011 and 2012.
 
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Other operating expenses: Other operating expenses increased by $23.0 million, or 6.5%, from $356.0 million for the year ended December 31, 2011 to $379.0 million for the year ended December 31, 2012. Excluding the impact of foreign exchange, other operating expenses increased by 18.3%, principally due to expenses related to the Acquisition incurred in 2012 that amounted to $62.6 million, partially offset by the impairment in 2011 of the Caribú Project, an intangible asset acquired in 2009 as more fully described in Note 6 to the Predecessor financial statements. We had $138.0 million in expenses for operating leases for the year ended December 31, 2011 as compared to $124.6 million in expenses for operating leases for the year ended December 31, 2012. As a percentage of revenue, other operating expenses constituted 14.7% and 16.4% for the year ended December 31, 2011 and 2012. Excluding the impact of Acquisition costs incurred at the end of 2012, other operating expenses, as a percentage of revenue, constituted 13.7% for the year ended December 31, 2012.
Brazil
Total operating expenses in Brazil decreased $128.8 million, or 10.4%, from $1,238.6 million for the year ended December 31, 2011 to $1,109.8 million for the year ended December 31, 2012. Excluding the impact of foreign exchange, operating expenses in Brazil increased by 4.4%, which was broadly in line with revenues. Operating expenses as a percentage of revenue decreased from 92.2% to 91.5%. The increase in operating expenses in Brazil was principally due to an increase in costs related to the growth of our business, which was primarily comprised of salaries and benefits expenses, telecommunication and rent and maintenance call center expenses, as well as improved customer mix and strong focus on costs.
Americas
Total operating expenses in the Americas increased $39.5 million, or 6.4%, from $615.5 million for the year ended December 31, 2011 to $655.0 million for the year ended December 31, 2012. Excluding the impact of foreign exchange, operating expenses in the Americas increased by 10.4% in line with revenues. Operating expenses as a percentage of revenue decreased from 90.6% to 90.2%.
EMEA
Total operating expenses in EMEA decreased $25.5 million, or 6.8%, from $373.7 million for the year ended December 31, 2011 to $348.2 million for the year ended December 31, 2012. Operating expenses as a percentage of revenue decreased from 94.2% to 92.0%. Excluding the impact of foreign exchange, operating expenses in EMEA increased by 0.8%. The change in operating expenses in EMEA was attributable to the expansion of the business, which was offset by the positive impact of the release of an employee benefit accrual of $11.3 million following the better-than-expected outcome of the collective bargaining agreement negotiation in Spain.
Operating profit
Operating profit decreased $34.2 million, or 22.0%, from $155.6 million for the year ended December 31, 2011 to $121.4 million for the year ended December 31, 2012. Excluding the impact of foreign exchange, operating profit decreased by 10.3%. Operating profit margin decreased from 6.4% for the year ended December 31, 2011 to 5.2% for the year ended December 31, 2012. The decrease in operating profit for the period was principally due to expenses related to the Acquisition, which amounted to $62.6 million, partially offset by strong business performance in all of our segments, as well as the positive impact of the release of an employee benefit accrual of $11.3 million following the better-than-expected outcome of the collective bargaining agreement negotiation in Spain. Excluding the impact of the Acquisition related expenses and the offset of the provision release, operating profit margin would be 7.5%.
Brazil
Operating profit in Brazil decreased $4.7 million, or 4.3%, from $108.2 million for the year ended December 31, 2011 to $103.5 million for the year ended December 31, 2012. Excluding the impact of foreign
 
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exchange, operating profit increased by 11.9% in 2012. Operating profit margin in Brazil increased from 8.1% for the year ended December 31, 2011 to 8.5% for the year ended December 31, 2012. The increase in operating profit in Brazil for the period was principally due to growth in our revenue, improved customer mix and strong focus on costs.
Americas
Operating profit in the Americas increased $9.4 million, or 14.5%, from $65.0 million for the year ended December 31, 2011 to $74.4 million for the year ended December 31, 2012. Excluding the impact of foreign exchange, operating profit in Americas increased by 20.0% in 2012. Operating profit margin in the Americas increased from 9.6% for the year ended December 31, 2011 to 10.2% for the year ended December 31, 2012. The increase in operating profit in the Americas was principally due to the strong revenue growth.
EMEA
Operating profit in EMEA increased $6.9 million, or 27.2%, from $25.4 million for the year ended December 31, 2011 to $32.3 million for the year ended December 31, 2012. Excluding the impact of foreign exchange, operating profit in EMEA increased by 37.8% in 2012. Operating profit margin in EMEA increased from 6.4% for the year ended December 31, 2011 to 8.5% for the year ended December 31, 2012. The increase in operating profit in EMEA for the period was principally due to the acquisition of a directory business from Telefónica in September 2011 and the positive impact in 2012 of the release of an employee benefit accrual of $11.3 million following the better than expected outcome of the collective bargaining agreement negotiation in Spain. Excluding the impact of the provision release, the operating profit margin would be 5.5%.
Finance income
Finance income increased by $3.3 million, or 30.3%, from $10.9 million for the year ended December 31, 2011 to $14.2 million for the year ended December 31, 2012. Excluding the impact of foreign exchange, finance income increased by 44.0%. This increase was principally due to an increase in cash, deposits and short term investments.
Finance costs
Finance costs increased by $13.0 million, or 67.7%, from $19.2 million for the year ended December 31, 2011 to $32.2 million for the year ended December 31, 2012. Excluding the impact of foreign exchange, finance costs increased by 87.5%. The increase was principally due to higher interest payments made in respect to the syndicated loan agreement entered into by Atento in 2011 and associated interest rate swaps termination costs, and higher costs in connection with the new Acquisition related financing for the month of December 2012.
Net foreign exchange gain/(loss)
Net foreign exchange loss decreased by $1.8 million, or 64.3%, from a loss of $2.8 million for the year ended December 31, 2011 to a loss of $1.0 million for the year ended December 31, 2012. This improvement is principally due to the exchange gains originated by receivables denominated in foreign currency held by European subsidiaries and to the positive effect of the fluctuation of the Mexican Peso, partially offset by the negative effect of the fluctuation of the Argentinean Peso against the U.S. dollar.
Income tax expense
Income tax expense for the years ended December 31, 2011 and December 31, 2012 was $54.9 million and $68.8 million, respectively, increasing by $13.9 million, or 25.3%. Excluding the impact of foreign exchange, income tax increased by 27.5%. The aggregated effective tax rate of the year ended December 31, 2012 is distorted because of the contribution of losses in the holding companies to our profit before tax. Adjusting for this effect, the average effective tax rate for the year ended December 31, 2012, excluding this effect, was 33%, while the average effective tax rate of the year ended December 31, 2011 was 38%. The decrease was primarily due to the reduction of the non-deductible expenses.
 
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Profit for the period
Profit for the years ended December 31, 2011 and December 31, 2012 was $90.3 million and $33.6 million, respectively. Excluding the impact of foreign exchange, profit margin decreased from 3.7% in 2011 to 1.9% in 2012 as a result of the factors discussed above.
EBITDA and Adjusted EBITDA
EBITDA decreased by $27.1 million, or 11.6%, from $234.1 million for the year ended December 31, 2011 to $207.0 million for the year ended December 31, 2012. Adjusted EBITDA increased by $21.2 million, or 8.6%, from $246.9 million for the year ended December 31, 2011 to $268.1 million for the year ended December 31, 2012. The increase in Adjusted EBITDA is principally due to cost efficiencies and revenue growth in the Americas. The difference between EBITDA and Adjusted EBITDA is due to exclusion of items that are not related to core operating results. The items excluded in the calculation of Adjusted EBITDA are Acquisition related costs, restructuring costs, assets impairments and other, and disposal of fixed assets. See “Selected Historical Financial Information” section for a reconciliation of EBITDA and Adjusted EBITDA to profit (loss). Excluding the impact of foreign exchange, EBITDA decreased by 0.1% and Adjusted EBITDA increased by 21.5%.
Brazil
EBITDA in Brazil decreased by $3.0 million, or 2.1%, from $145.7 million for the year ended December 31, 2011 to $142.7 million for the year ended December 31, 2012. Adjusted EBITDA in Brazil increased by $3.8 million, or 2.7%, from $141.3 million for the year ended December 31, 2011 to $145.1 million for the year ended December 31, 2012. Excluding the impact of foreign exchange, EBITDA and Adjusted EBITDA increased by 14.4% and 19.8%, respectively. The increase in EBITDA is principally due to strong growth in our non-Telefónica client relationships and cost efficiencies.
Americas
EBITDA in Americas increased by $11.6 million, or 12.2%, from $95.1 million for the year ended December 31, 2011 to $106.7 million for the year ended December 31, 2012. Adjusted EBITDA in Americas increased by $18.3 million, or 19.2%, from $95.1 million for the year ended December 31, 2011 to $113.4 million for the year ended December 31, 2012. Excluding the impact of foreign exchange, EBITDA and Adjusted EBITDA increased by 17.1% and 24.7%, respectively. The increase in EBITDA and Adjusted EBITDA was principally due to strong revenue growth due to increase in work volume within existing clients, including Telefónica, expansion of client portfolio, and new services offered to clients.
EMEA
EBITDA in EMEA increased by $11.7 million, or 34.3%, from $34.1 million for the year ended December 31, 2011 to $45.8 million for the year ended December 31, 2012. Adjusted EBITDA in EMEA increased by $2.4 million, or 7.3%, from $32.9 million for the year ended December 31, 2011 to $35.3 million for the year ended December 31, 2012. Excluding the impact of foreign exchange, EBITDA increased by 45.5% and Adjusted EBITDA increased by 16.1%. The increase in EBITDA is principally due to the positive impact in 2012 of the release of an employee benefit accrual of $11.3 million following the better-than-expected outcome of the collective bargaining agreement negotiation in Spain and the acquisition of a directory business from Telefónica in September 2011.
Six Months Ended June 30, 2013 Compared to the Six Months Ended June 30, 2014
Revenue
Revenue decreased by $13.5 million, or 1.2%, from $1,167.1 million for the six months ended June 30, 2013 to $1,153.6 million for the six months ended June 30, 2014. Excluding the impact of foreign exchange,
 
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revenue increased by 9.5%. Excluding the impact of foreign exchange, revenue from Telefónica companies increased by 5.2%, driven primarily by solid performance in the Americas and, in particular, in Chile due to the new business model implementation during 2013 and the introduction of new services in Brazil. This positive performance in the Americas and Brazil largely offset the reduction in EMEA caused by adverse economic conditions in Spain. Excluding the impact of foreign exchange, revenue from non-Telefónica clients increased by 13.7% due to the strong double digit growth in all the regions.
The following chart sets forth a breakdown of revenue based on geographical region for the six months ended June 30, 2013 and June 30, 2014 and as a percentage of revenue and the percentage change between those periods with and net of foreign exchange effects.

 	  	For the six months ended June 30,	 	
 	  	2013
(unaudited)	 	  	2014
(unaudited)	 	  	Change	 	 	Change
excluding
FX	 	
 	  	$	 	 	(%)	 	  	$	 	 	(%)	 	  	(%)	 	 	(%)	 	
($ in millions)	  	 	 	 	 	 	  	 	 	 	 	 	  	 	 	 	 	 	
Brazil	  	 	606.5	  	 	 	52.0	  	  	 	598.5	  	 	 	51.9	  	  	 	(1.3	) 	 	 	11.4	  	
Americas	  	 	375.3	  	 	 	32.1	  	  	 	372.3	  	 	 	32.2	  	  	 	(0.8	) 	 	 	13.8	  	
EMEA	  	 	185.6	  	 	 	15.9	  	  	 	183.1	  	 	 	15.9	  	  	 	(1.3	) 	 	 	(5.3	) 	
Other and eliminations (1)	  	 	(0.3	) 	 	 	—	  	  	 	(0.3	) 	 	 	—	  	  	 	—	  	 	 	(33.3	) 	
Total	  	 	1,167.1	  	 	 	100	  	  	 	1,153.6	  	 	 	100	  	  	 	(1.2	) 	 	 	9.5	  	

(1)	Includes holding company level revenues and consolidation adjustments.	
Brazil
Revenue in Brazil for the six months ended June 30, 2013 and June 30, 2014 was $606.5 million and $598.5 million, respectively. Revenue decreased in Brazil by $8.0 million, or 1.3%. Excluding the foreign exchange impact, revenue increased by 11.4% over this period. Excluding the impact of foreign exchange, revenue from Telefónica companies increased by 9.1%, principally due to the introduction of new services in Brazil. Revenue from non-Telefónica clients, excluding the impact of foreign exchange, increased by 13.2% over this period, principally due to volume growth and the introduction of new services with current clients, primarily in the financial services sector, in addition to the capture of new clients.
Americas
Revenue in the Americas for the six months ended June 30, 2013 and June 30, 2014 was $375.3 million and $372.3 million, respectively. Revenue decreased in the Americas by $3.0 million, or 0.8%. Excluding the impact of foreign exchange, revenue increased by 13.8%. Excluding the impact of foreign exchange, revenue from Telefónica companies increased by 13.0% over this period, with strong performance across the region and in particular in Chile thanks to the positive impact of the implementation of the new business model with Telefónica during 2013. Excluding the impact of foreign exchange, revenue from non-Telefónica clients increased by 14.7%, with growth in most of the markets with current clients and also through new clients.
EMEA
Revenue in EMEA for the six months ended June 30, 2013 and June 30, 2014 was $185.6 million and $183.1 million, respectively. Revenue decreased in EMEA by $2.5 million, or 1.3%. Excluding the foreign exchange impact, revenue decreased by 5.3%. Excluding the foreign exchange impact, revenue from Telefónica companies decreased by 14.1% principally due to a decrease in the volume of customer sales in Spain, driven by the adverse Telefónica situation in the Spanish telecommunications market. Revenue from non-Telefónica clients increased by 13.4%, excluding the impact of foreign exchange, principally due to new clients in Spain.
 
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Other operating income
Other operating income increased by $0.3 million, or 50.0%, from $0.6 million for the six months ended June 30, 2013 to $0.9 million for the six months ended June 30, 2014. Excluding the impact of foreign exchange, other operating income increased by 50.0% principally due to the subsidies received in Spain for hiring disabled employees.
Other gains
In May 2014, the MSA with Telefónica, which required the Telefónica Group companies to meet pre-agreed minimum annual revenue commitments to us through 2021, was amended to adjust minimum revenue commitments in relation to Spain and Morocco, to reflect the expected lower level of activities in these countries. The provisions of the MSA required Telefónica to compensate us in case of shortfalls in these revenue commitments. Based on the above, Telefónica agreed to compensate us with a penalty fee amounting to €25.4 million (equivalent to $34.9 million for the six months ended June 30, 2014).
Total operating expenses
Total operating expenses increased by $25.4 million, or 2.2%, from $1,131.9 million for the six months ended June 30, 2013 to $1,157.3 million for the six months ended June 30, 2014. Excluding the impact of foreign exchange, operating expenses increased by 12.6%. As a percentage of revenue, operating expenses constituted 97.0% and 100.3% for the six months ended June 30, 2013 and 2014, respectively. This increase is principally due to the impairment charges recognized and increases in employee benefit expenses due to restructuring costs. Adjusting for both of these items, operating expenses as a percentage of revenues would have constituted 95.6%, a decrease of 4.7% for the six months ended June 30, 2014.
The $25.4 million increase in operating expenses during the six months ended June 30, 2014 resulted from the following components:
Supplies: Supplies increased by $6.0 million, or 13.0%, from $46.1 million for the six months ended June 30, 2013 to $52.1 million for the six months ended June 30, 2014. Excluding the impact of foreign exchange, supplies expense increased by 27.1%. The increase is principally explained by growth in Brazil and Mexico as well as a reclassification of costs previously booked as Other Operating Costs and now booked as Supplies, which were partially offset by a decrease in the EMEA region as a result of lower activity. As a percentage of revenue, supplies constituted 3.9% and 4.5% for the six months ended June 30, 2013 and 2014, respectively.
Employee benefits expenses: Employee benefits expenses increased by $13.2 million, or 1.6%, from $830.1 million for the six months ended June 30, 2013 to $843.3 million for the six months ended June 30, 2014. Excluding the impact of foreign exchange, employee benefits expenses increased by 12.4%. This increase in employee benefits expenses was principally due to the restructuring expenses in Spain, Argentina and Chile. This increase was partially offset by operational efficiencies generated. Adjusting for restructuring expenses of $21.6 million and excluding the impact of foreign exchange, employee benefits expenses would have increased by 9.7%. As a percentage of our revenue, employee benefits expenses constituted 71.1% and 73.1% for the six months ended June 30, 2013 and 2014, respectively. Adjusting for restructuring expenses, employee benefits expenses as a percentage of revenue would have constituted 71.0% and 71.2% for the six months ended June 30, 2013 and 2014, respectively. Adjusting for restructuring expenses and excluding the impact of foreign exchange, employee benefits expense as a percentage of revenue would have constituted 71.2%. The headcount reduction plan in Spain will take into consideration a maximum number of terminations amounting to 9% of the total headcount of Atento Teleservicios España, S.A.U. We expect to substantially complete the headcount reduction plan by the fourth quarter of 2014.
 
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Depreciation and amortization: Depreciation and amortization expense decreased by $4.4 million, or 6.7%, from $66.0 million for the six months ended June 30, 2013 to $61.6 million for the six months ended June 30, 2014. Excluding the impact of foreign exchange, depreciation and amortization expense increased by 0.9%, principally due to the usual investments of the business.
Changes in trade provisions: Changes in trade provisions decreased by $2.5 million, from a positive change of $2.2 million for the six months ended June 30, 2013 to a negative change of $0.3 million for the six months ended June 30, 2014. This decrease was principally due to the collection, in 2013, of some receivables that had been previously impaired. As a percentage of revenue, changes in trade provisions constituted 0.2% and 0.0% for the six months ended June 30, 2013 and 2014.
Other operating expenses: Other operating expenses decreased by $24.9 million, or 13.0%, from $192.0 million for the six months ended June 30, 2013 to $167.1 million for the six months ended June 30, 2014. Excluding the impact of foreign exchange, other operating expenses decreased by 4.2%, principally due to cost efficiencies and ramp-down of non-core acquisition and integration costs. As a percentage of revenue, other operating expenses constituted 16.5% and 14.5% for the six months ended June 30, 2013 and 2014, respectively.
Impairment charges: As of June 30, 2014, we performed an impairment test on the carrying amount of customer relationship intangible assets, goodwill and property, plant and equipment given the amendment to the MSA which impacted the amount of expected revenue and also considering the changes in expected revenue in certain countries. The impairment test was performed using assumptions revised in accordance with the amendments to the MSA and with updated management expectations on cash flow generation from the different countries where we operate. The result of the test performed was an impairment charge of $28.0 million of the intangible asset related to the customer relationship with Telefónica in connection with the MSA. Impairment charges of $1.1 million of goodwill in Spain and of $3.8 million of goodwill in the Czech Republic were recognized during the first six months of 2014 as a result of this impairment test.
Brazil
Total operating expenses in Brazil decreased by $14.2 million, or 2.5%, from $570.7 million for the six months ended June 30, 2013 to $556.5 million for the six months ended June 30, 2014. Excluding the impact of foreign exchange, operating expenses in Brazil increased by 10.1%, which was slightly below revenue growth. Operating expenses as a percentage of revenue decreased from 94.1% to 93.0%. The decrease in operating expenses in Brazil as a percentage of sales was principally due to cost efficiencies in addition to higher costs incurred in 2013 because of the introduction of new Telefónica services.
Americas
Total operating expenses in the Americas decreased by $3.1 million, or 0.9%, from $352.0 million for the six months ended June 30, 2013 to $348.9 million for the six months ended June 30, 2014. Excluding the impact of foreign exchange, operating expenses in the Americas increased by 14.9%, in line with the increase in revenues. Operating expenses as a percentage of revenue decreased from 93.8% to 93.7% in the six months ended June 30, 2014.
EMEA
Total operating expenses in EMEA increased by $49.8 million, or 27.0%, from $184.7 million for the six months ended June 30, 2013 to $234.5 million for the six months ended June 30, 2014. Operating expenses as a percentage of revenue increased from 99.5% to 128.1%. Excluding the impact of foreign exchange, operating expenses in EMEA increased by 21.9%. The change in operating expenses in EMEA in the six months ended June 30, 2014 was attributable to impairment charges and restructuring costs.
 
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Operating profit
Operating profit decreased by $3.4 million, or 9.5%, from $35.7 million for the six months ended June 30, 2013 to $32.3 million for the six months ended June 30, 2014. Excluding the impact of foreign exchange, operating profit increased by 7.6%. Operating profit margin decreased from 3.1% for the six months ended June 30, 2013 to 2.8% for the six months ended June 30, 2014 principally due to the recognized impairments in EMEA and restructuring costs. Excluding this impact, operating profit margin would have been 7.5%, driven mainly by the operational improvement in most of the markets as a result of the implementation of strategic initiatives, in addition to the growth in Chile after the implementation of a new business model with Telefónica during 2013 and the costs related to the introduction of new services with Telefónica in Brazil during the first half of 2013.
Brazil
Operating profit in Brazil increased by $6.2 million, or 17.2%, from $36.0 million for the six months ended June 30, 2013 to $42.2 million for the six months ended June 30, 2014. Excluding the impact of foreign exchange, operating profit increased by 32.2% in 2014. Operating profit margin in Brazil increased from 5.9% for the six months ended June 30, 2013 to 7.1% for the six months ended June 30, 2014. The increase in operating profit in Brazil for the period was principally due to cost efficiencies (partially offset by higher costs) in 2013 related to the introduction of new services with Telefónica.
Americas
Operating profit in the Americas increased by $0.4 million, or 1.7%, from $23.4 million for the six months ended June 30, 2013 to $23.8 million for the six months ended June 30, 2014. Excluding the impact of foreign exchange, operating profit in Americas decreased by 0.4% in 2014. Operating profit margin in the Americas increased from 6.2% for the six months ended June 30, 2013 to 6.4% for the six months ended June 30, 2014. The increase in operating profit in the Americas was principally due to the better performance in most of the markets where we operate, including significant improvement in Chile following implementation of the new business model with Telefónica during 2013.
EMEA
Operating profit in EMEA decreased by $51.6 million, from a profit of $1.2 million for the six months ended June 30, 2013 to a loss of $50.4 million for the six months ended June 30, 2014. Excluding the impact of foreign exchange, operating profit in EMEA decreased by $49.7 million in 2014. Operating profit margin in EMEA decreased from 0.6% for the six months ended June 30, 2013 to a loss of 27.5% for the six months ended June 30, 2014, principally impacted by the recognized impairment charge ($32.9 million) discussed above and the restructuring costs ($16.9 million). Excluding this impact, operating profit margin would have been a loss of 0.3% during the six months ended June 30, 2014, resulting from underutilized workforce and infrastructure.
Finance income
Finance income decreased by $1.8 million, or 20.2%, from $8.9 million for the six months ended June 30, 2013 to $7.1 million for the six months ended June 30, 2014. Excluding the impact of foreign exchange, finance income decreased by 9.0% during the six months ended June 30, 2014. This decrease was principally due to lower unrealized gains on cross-currency swaps associated with the 7.375% Senior Secured Notes. This was partially offset by realized gains on interest rate swaps associated with the Brazilian Debentures.
Finance costs
Finance costs increased by $11.4 million, or 17.2%, from $66.4 million for the six months ended June 30, 2013 to $77.8 million for the six months ended June 30, 2014. Excluding the impact of foreign exchange, finance
 
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costs increased by 21.8% during the six months ended June 30, 2014. This increase was principally due to higher finance costs of $6.1 million incurred in 2014 related to the Preferred Equity Certificates which we expect to capitalize in connection with this offering, higher unrealized losses of $4.4 million on cross-currency swaps associated with the 7.375% Senior Secured Notes issued on January 29, 2013 and an increase of $1.7 million due to a full period of finance costs incurred on the 7.375% Senior Secured Notes.
Net foreign exchange gain/(loss)
Net foreign exchange gain/(loss) increased by $7.0 million, from a loss of $3.4 million for the six months ended June 30, 2013 to a gain of $3.6 million for the six months ended June 30, 2014. This improvement was principally due to net foreign exchange gains resulting from liabilities denominated in foreign currencies which depreciated against the U.S. dollar during the 2014 period.
Income tax benefit
Income tax benefit for the six months ended June 30, 2013 and June 30, 2014 was $2.1 million and $10.5 million, respectively, increasing by $8.4 million during the six months ended June 30, 2014. Excluding the impact of foreign exchange, income tax increased by $7.0 million. The aggregated effective tax rate for the six months ended June 30, 2014 is distorted because of the contribution of losses in the holding companies to our profit before tax and the tax effect of the impairment charges. Adjusting for this effect, the average effective tax rate for the six months ended June 30, 2014 would have been 36.0%, while the average effective tax rate of the six months ended June 30, 2013 would have been 38.6%.
Profit/(loss) for the period
Profit/(loss) for the six months ended June 30, 2013 and June 30, 2014 was a loss of $23.1 million and $24.3 million, respectively. Excluding the impact of foreign exchange, profit margin increased from (2.0)% in the six months ended June 30, 2013 to (1.9)% in the six months ended June 30, 2014 as a result of the factors discussed above.
EBITDA and Adjusted EBITDA
EBITDA decreased by $7.8 million, or 7.7%, from $101.7 million for the six months ended June 30, 2013 to $93.9 million for the six months ended June 30, 2014. Adjusted EBITDA increased by $7.7 million, or 6.2%, from $123.9 million for the six months ended June 30, 2013 to $131.6 million for the six months ended June 30, 2014. The difference between EBITDA and Adjusted EBITDA is due to the exclusion of items that are not related to our core results of operations. Adjusted EBITDA is defined as EBITDA adjusted to exclude Acquisition and integration related costs, restructuring costs, sponsor management fees, asset impairments, site relocation costs, financing and IPO fees and other items which are not related to our core results of operations. See “Selected Historical Financial Information” for a reconciliation of EBITDA and Adjusted EBITDA to profit/(loss).
Excluding the impact of foreign exchange, EBITDA increased by 3.2% and Adjusted EBITDA increased by 16.1% mainly due to revenue growth and solid performance in Brazil after the Telefónica ramp up during the first six months of 2013, more than offsetting the volume reduction in EMEA.
Brazil
EBITDA in Brazil increased by $4.2 million, or 6.4%, from $65.8 million for the six months ended June 30, 2013 to $70.0 million for the six months ended June 30, 2014. Adjusted EBITDA in Brazil increased by $9.0 million, or 13.3%, from $67.9 million for the six months ended June 30, 2013 to $76.9 million for the six
 
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months ended June 30, 2014. Excluding the impact of foreign exchange, EBITDA and Adjusted EBITDA increased by 20.1% and 27.8%, respectively. The increase in EBITDA and Adjusted EBITDA is principally due to the strong growth with existing clients and capture of new clients, as well as the efficiencies generated in the operations.
Americas
EBITDA in the Americas decreased by $1.9 million, or 4.0%, from $47.3 million for the six months ended June 30, 2013 to $45.4 million for the six months ended June 30, 2014. Adjusted EBITDA in the Americas increased by $0.6 million, or 1.2%, from $49.0 million for the six months ended June 30, 2013 to $49.6 million for the six months ended June 30, 2014. Excluding the impact of foreign exchange, EBITDA and Adjusted EBITDA decreased by 0.8% and increased by 6.3%, respectively, during the six months ended June 30, 2014. The first six months of 2014 showed strong performance in Mexico, Peru and Chile. Chile in particular was positively impacted by the finalization of the implementation of a new business model with Telefónica. This was offset by weak performance in Argentina, as salary increased starting in April 2014 but price pass-through negotiations will only be completed in the third quarter of 2014. We expect the agreed price pass-through to apply retro-actively and the related revenues to be booked in the third quarter of 2014. Excluding Argentina, EBITDA and Adjusted EBITDA increased by 30.3% and 28.0%, respectively, during the six months ended June 30, 2014 compared to the same period in 2013. Excluding Argentina and the impact of foreign exchange, EBITDA and Adjusted EBITDA increased by 38.2% and 34.3%, respectively, during the six months ended June 30, 2014 compared to the same period in 2013.
EMEA
EBITDA in EMEA decreased by $52.0 million, from $13.2 million for the six months ended June 30, 2013 to $(38.8) million for the six months ended June 30, 2014. Adjusted EBITDA in EMEA decreased by $2.5 million, or 18.7%, from $13.4 million for the six months ended June 30, 2013 to $10.9 million for the six months ended June 30, 2014. Excluding the impact of foreign exchange, Adjusted EBITDA decreased by 21.6%. The decrease in Adjusted EBITDA, during the six months ended June 30, 2014 is principally due to a reduction in Telefónica volume in Spain.
Liquidity and Capital Resources
We fund our ongoing capital and working capital requirements through a combination of cash flows from our operating and financing activities. Based on our current and anticipated levels of operations and conditions in our markets and industry, we believe that our cash on hand and cash flows from our operating, investing and financing activities, including funds available under the Revolving Credit Facility, will enable us to meet our working capital, capital expenditures, debt service and other funding requirements for the foreseeable future. We have ample liquidity: as at December 31, 2013, the total amount of credit available to us was €50 million ($69 million) under our Revolving Credit Facility, which remains undrawn as at December 31, 2013. In addition, we had cash and cash equivalents (net of any outstanding bank overdrafts) of approximately $213.5 million as at December 31, 2013, of which $13.7 million is located in Argentina and subject to restrictions on our ability to transfer them out of the country. As of June 30, 2014, the total amount of credit available to us was €50 million ($68.3 million) under our Revolving Credit Facility, which remains undrawn as of June 30, 2014. In addition, we had cash and cash equivalents (net of any outstanding bank overdrafts) and short-term financial investments of approximately $237.7 million as of June 30, 2014, of which $6.9 million (less than 3% of the total) is located in Argentina and subject to restrictions on our ability to transfer them out of the country.
However, our ability to fund our working capital needs, debt payments and other obligations, and to comply with the financial covenants under our debt agreements, depends on our future operating performance and cash flow, which are in turn subject to prevailing economic conditions, and other factors, many of which are beyond our control. Any future acquisitions, joint ventures or other similar transactions will likely require additional capital and such capital may not be available to us on acceptable terms, if at all.
 
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Our cash flows from our operating, investing and financing activities may be impacted by, among other things, the global financial environment on our customers and the financial, foreign exchange, equity and credit markets, and rapid changes in the highly competitive market in which we operate.
Although we expect to fund our capital needs during 2014 with our available cash on hand and cash generated from our operating and financing activities, in the future, including the proceeds from this offering, we may have to incur additional debt or issue additional debt or equity securities from time to time. Capital available to CRM BPO service providers, whether raised through the issuance of debt or equity securities, may be limited. As a result, we may be unable to obtain sufficient financing terms satisfactory to management or at all.
As of December 31, 2013, our outstanding debt amounted to $1,370.8 million. The amount attributable to the Acquisition in 2012 was $1,358.3 million, which includes $297.7 million of our 7.375% Senior Secured Notes due 2020, $345.9 million of Brazilian Debentures, $151.7 million of Vendor Loan Note, $43.4 million of CVIs and $519.6 million of PECs that will be capitalized in connection with this offering. Excluding the PECs, the amount of outstanding debt attributable to the Acquisition in 2012 would have been $838.7 million.
As of June 30, 2014, our outstanding debt amounted to $1,366.0 million, which includes $299.6 million of our 7.375% Senior Secured Notes due 2020, $330.6 million equivalent amount of Brazilian Debentures, $31.4 million of Vendor Loan Note, $36.4 million of CVIs, $9.9 million of finance lease payables, $36.8 million of financing provided by BNDES, $0.6 million of other bank borrowings and $620.7 million of PECs that will be capitalized in connection with this offering.
During the six months ended June 30, 2014 we have drawn $36.8 million equivalent amount under our credit agreement with BNDES. On May 30, 2014, Midco issued PECs for an aggregate amount of €64.1 million (equivalent to $87.3 million) which proceeds were applied to make a partial prepayment of the Vendor Loan Note. In addition, the MSA with Telefónica was amended and Telefónica agreed to compensate us with a penalty fee amounting to €25.4 million (equivalent to $34.9 million for the six months ended June 30, 2014). We, in turn, used this amount to partially prepay the Vendor Loan Note due to Telefónica. Finally, we prepaid BRL 34.4 million and BRL 45.0 million, respectively (equivalent to $15.5 million and $20.4 million, respectively) of the Brazilian Debentures.
During 2013, our cash flow used to service our debt amounted to $312.8 million which includes voluntary prepayments of the Brazilian Debentures of BRL 71.6 million (equivalent to $35.5 million) on March 25, 2013 and BRL 26.4 million (equivalent to $12.3 million) on June 11, 2013, reduction of $200.7 million in the principal amount of our debt outstanding that resulted from refinancing transactions and interest payments of $63.3 million. Also during 2013, our net cash flows from operating activities amounted to $99.6 million, which includes interest paid of $63.3 million. As such, our net cash flows from operating activities (before giving effect to the payment of interest) amounted to $162.9 million. The cash flow used to service our debt represented 192.0% of our net cash flows from operating activities (before giving effect to the payment of interest). Excluding the voluntary prepayments of our Brazilian Debentures and the reduction in principal debt outstanding mentioned above, cash flow used to service our debt would have represented 38.9% of the net cash flows from operating activities (before giving effect to the payment of interest).
For the six months ended June 30, 2014, our cash flow used for debt service totaled $172.3 million, which includes voluntary prepayments of our Brazilian Debentures of BRL 34.4 million (equivalent to $15.5 million) on May 12, 2014 and BRL 45.0 million (equivalent to $20.4 million) on June 26, 2014, voluntary prepayments of our Vendor Loan Note of €64.2 million (equivalent to $87.9 million) on May 30, 2014, and interest payments of $48.3 million. Also, during the six months ended June 30, 2014, our net cash flows from operating activities totaled $65.9 million, which includes interest paid of $48.3 million. As such, our net cash flows from operating activities (before giving effect to the payment of interest) amounted to $114.2 million. Cash flow used to service our debt represented 150.9% of our net cash flows from operating activities (before giving effect to the payment of interest). Excluding the voluntary prepayments of our Brazilian Debentures and Vendor Loan Note mentioned above, our cash flow related to interest payment and mandatory debt repayment represented 42.3% of the cash flows from operating activities (before giving effect to the payment of interest).
 
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Cash Flow
As of June 30, 2014, we had cash and cash equivalents (net of any outstanding bank overdrafts) and short-term financial investments of approximately $237.7 million. We believe that our current cash flow from operating activities and financing arrangements will provide us with sufficient liquidity to meet our working capital needs. See “Description of Certain Indebtedness.”

 	 	Predecessor	 	 	Successor	 	 	(Non-IFRS Aggregated)	 	 	Successor	 	
($ in millions)	 	For the year
ended
December 31,
2011	 	 	January 1, 2012
to November 30,
2012	 	 	December 1,
2012 to
December 31,
2012	 	 	For the year ended
December 31,
2012
(unaudited)	 	 	For the year
ended
December 31,
2013	 	 	For the six months
ended June 30,	 	
	 			 			 			 			 			 	2013
(unaudited)	 	 	2014
(unaudited)	 	
Cash provided by/(used in) operating activities	 	 	116.6	  	 	 	163.6	  	 	 	(68.3	) 	 	 	95.3	  	 	 	99.6	  	 	 	34.2	  	 	 	65.9	  	
Cash (used in) investing activities	 	 	(134.6	) 	 	 	(118.7	) 	 	 	(846.1	) 	 	 	(964.8	) 	 	 	(123.4	) 	 	 	(101.5	) 	 	 	(102.0	) 	
Cash provided by/(used in) financing activities	 	 	27.0	  	 	 	(75.0	) 	 	 	1,109.6	  	 	 	1,034.6	  	 	 	31.2	  	 	 	40.8	  	 	 	1.2	  	
Effect of changes in exchanges rates	 	 	(0.1	) 	 	 	(2.2	) 	 	 	5.1	  	 	 	2.9	  	 	 	5.8	  	 	 	3.3	  	 	 	(0.3	) 	
Net increase (decrease) in cash and cash equivalents	 	 	8.8	  	 	 	(32.3	) 	 	 	200.3	  	 	 	168.0	  	 	 	13.2	  	 	 	(23.2	) 	 	 	(35.2	) 	
Cash Provided by Operating Activities
Year Ended December 31, 2013 Compared to Year Ended December 31, 2012
Net cash provided by operating activities was $99.6 million for the year ended December 31, 2013 compared to $95.3 million for the year ended December 31, 2012. Net cash provided by operating activities was stable as growth in the business was offset by higher interest payments in connection with certain debt facilities we entered into in 2012 in connection with the Acquisition.
Year Ended December 31, 2012 Compared to Year Ended December 31, 2011
Net cash provided by operating activities was $95.3 million for the year ended December 31, 2012 compared to $116.6 million for the year ended December 31, 2011. The net cash provided by operating activities in 2011 was impacted by a negative change in working capital following Telefónica’s unification of its payment policies and terms (extending the payment cycle with respect to us) among providers belonging to Telefónica Group entities and external providers. The net cash provided by operating activities in 2012 was negatively impacted by the Acquisition costs.
Six Months Ended June 30, 2014 Compared to Six Months Ended June 30, 2013
Net cash provided by operating activities was $65.9 million for the six months ended June 30, 2014 compared to $34.2 million for the six months ended June 30, 2013. The increase in net cash provided by operating activities was as a result of an improvement in working capital mainly in Spain, Mexico and Chile and also due to lower taxes paid.
 
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Cash Used in Investing Activities
Year Ended December 31, 2013 Compared to Year Ended December 31, 2012
Net cash used in investing activities was $123.4 million for the year ended December 31, 2013 compared to $964.8 million for the year ended December 31, 2012. The decrease in 2013 is principally attributable to the impact in 2012 of the consideration paid to Telefónica in relation to the Acquisition for an amount of $795.4 million.
Year Ended December 31, 2012 Compared to Year Ended December 31, 2011
Net cash used in investing activities was $964.8 million for the year ended December 31, 2012 compared to $134.6 million for the year ended December 31, 2011. The increase in net cash used in investing activities in 2012 was primarily attributable to the consideration paid to Telefónica in relation to the Acquisition. Net cash used in investing activities in 2011 was impacted by consideration paid related to the acquisition of a directory business from Telefónica in Spain in the amount of $48.6 million.
Six Months Ended June 30, 2014 Compared to Six Months Ended June 30, 2013
Net cash used in investing activities was $102.0 million for the six months ended June 30, 2014 compared to $101.5 million for the six months ended June 30, 2013. Net cash used in investing activities for the six months ended June 30, 2014 mainly included payments for capital expenditures of $45.2 million, payments for financial instruments of $60.2 million, which include $59.5 of short term financial investments in Brazil, and proceeds from financial instruments of $2.4 million.
Cash Provided by Financing Activities
Year Ended December 31, 2013 Compared to Year Ended December 31, 2012
Net cash provided by financing activities was $31.2 million for the year ended December 31, 2013 compared to $1,034.6 million for the year ended December 31, 2012. The decrease in net cash provided by financing activities was primarily attributable to the impact of new debt facilities entered into in 2012 in relation to the Acquisition equaling $1,107.0 million.
Year Ended December 31, 2012 Compared to Year Ended December 31, 2011
Net cash provided by financing activities was $1,034.6 million for the year ended December 31, 2012 compared to $27.0 million for the year ended December 31, 2011. The increase in 2012 in net cash provided by financing activities was primarily attributable to the impact of new debt facilities entered into in 2012 in relation to the Acquisition.
Six Months Ended June 30, 2014 Compared to Six Months Ended June 30, 2013
Net cash provided by financing activities was $1.2 million for the six months ended June 30, 2014 compared to $40.8 million for the six months ended June 30, 2013. The decrease in net cash provided by financing activities was primarily attributable to the net proceeds received from the issuance of 7.375% Senior Secured Notes due 2020 during the six months ended June 30, 2013.
Free Cash Flow
Our management uses Free cash flow to assess our liquidity and the cash flow generation of our operating subsidiaries. We define Free cash flow as net cash flows from operating activities less capital expenditures (addition to property, plant and equipment, and intangible assets) for the period. We believe that Free cash flow is useful to investors because it adjusts our operating cash flow by the capital that is invested to continue and improve business operations.
 
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Free cash flow has limitations as an analytical tool. Free cash flow is not a measure defined by IFRS and should not be considered in isolation from, or as an alternative to, cash flow from operating activities or other measures as determined in accordance with IFRS. Additionally, Free cash flow does not represent the residual cash flow available for discretionary expenditures as it does not incorporate certain cash payments, including payments made on finance lease obligations or cash payments for business acquisitions. Free cash flow is not necessarily comparable to similarly titled measures used by other companies.

 	 	Predecessor	 	 	Successor	 	 	Non-IFRS Aggregated	 	 	Successor	 	
 	 	Year ended
December 31,
2011	 	 	Period from
Jan 1 – Nov 30,
2012	 	 	Period from
Dec 1 – Dec 31,
2012	 	 	Year ended
December 31,
2012
(unaudited)	 	 	Year ended
December 31,
2013	 	 	Six months ended
June 30,	 	
($ in millions)	 			 			 			 			 			 	2013
(unaudited)	 	 	2014
(unaudited)	 	
Net cash flow from operating activities	 	 	116.6	  	 	 	163.6	  	 	 	(68.3	) 	 	 	95.3	  	 	 	99.6	  	 	 	34.2	  	 	 	65.9	  	
Capital expenditures	 	 	(141.6	) 	 	 	(76.9	) 	 	 	(28.4	) 	 	 	(105.3	) 	 	 	(103.0	) 	 	 	(28.7	) 	 	 	(40.6	) 	
Free cash flow (non-GAAP) (unaudited)	 	 	(25.0	) 	 	 	86.7	  	 	 	(96.7	) 	 	 	(10.0	) 	 	 	(3.4	) 	 	 	5.5	  	 	 	25.3	  	
Year ended December 31, 2013 Compared to Year ended December 31, 2012
Free cash flow improved by $6.6 million from a loss of $10.0 million for the year ended December 31, 2012 to a loss of $3.4 million for the year ended December 31, 2013. The improvement in free cash flow in 2013 was principally due to the increase in net cash flow from operating activities. Free cash flow for the year ended December 31, 2013, was negatively impacted by cash outflows of $28.2 million related to Acquisition and integration related costs, $0.7 million related to restructuring costs, $8.9 million related to sponsor management fees and $3.9 million related to financing fees. Free cash flow for the year ended December 31, 2012, was negatively impacted by cash outflows of $59.7 million related to Acquisition and integration related costs and $2.2 million related to restructuring costs.
Year ended December 31, 2012 Compared to Year ended December 31, 2011
Free cash flow improved by $15.0 million from a loss of $25.0 million for the year ended December 31, 2011 to a loss of $10.0 million for the year ended December 31, 2012. The improvement in Free cash flow in 2012 was principally due to lower capital expenditure as 2011 capital expenditures were impacted primarily by the acquisition of a directory business in Spain from Telefónica. Free cash flow for the year ended December 31, 2012 was negatively impacted by cash outflows not related to our core results of operations of $59.7 million related to Acquisition and integration related costs and $2.2 million related to restructuring costs. Free cash flow for the year ended December 31, 2011 was negatively impacted by cash outflows of $25.1 million related to the acquisition of the directory business from Telefónica, $4.7 million related to restructuring costs and $1.6 million in other cash outflows not related to our core results of operations.
Six Months Ended June 30, 2014 Compared to Six Months Ended June 30, 2013
Free cash flow improved by $19.8 from $5.5 million for the six months ended June 30, 2013 to $25.3 million for the six months ended June 30, 2014. The improvement in free cash flow for the six months ended June 30, 2014 was principally due to the increase in net cash flow from operating activities.
Free cash flow for the six months ended June 30, 2014 was negatively impacted by cash outflows of $2.7 million related to Acquisition and integration related costs, $5.1 million related to restructuring costs, $0.8 million related to site relocation costs and $3.4 million related to financing fees and IPO costs.
 
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Free cash flow for the six months ended June 30, 2013 was (i) negatively impacted by cash outflows of $9.2 million related to Acquisition and integration related costs, $0.2 million related to restructuring costs and $3.1 million related to financing fees, and (ii) positively impacted by $1.1 million related to other.
Financing Arrangements

Description	  	Currency	  	Maturity	  	Interest rate	 	 	Unaudited
Amount as of
June 30, 2014
($ in millions)	 	
Senior Secured Notes (1)	  	USD	  	2020	  	 	7.375%	  	 	 	299.6	  	
Brazilian Debentures (2)	  	BRL	  	2019	  	 	CDI+3.7%	  	 	 	330.6	  	
BNDES	  	BRL	  	2020	  	 	7.71%	* 	 	 	36.8	  	
Other bank borrowings	  	MAD	  	2016	  	 	6%	  	 	 	0.6	  	
CVIs (3)	  	ARS	  	2022	  	 	N/A	  	 	 	36.4	  	
Vendor Loan Note (4)	  	EUR	  	2022	  	 	5%	  	 	 	31.4	  	
Finance lease payables	  	BRL, COP
USD	  	2018	  	 	6.32%-13.7%	  	 	 	9.9	  	
Debt with Third Parties	  		  		  				 	 	745.3	  	
PECs	  	EUR	  	2042-2072	  	 	0%-8.0309%	  	 	 	620.7	  	
Total Debt	  		  		  				 	 	1,366.0	  	

  *	Average cost of debt across tranches.	
(1)	Represents the principal amount of $300 million minus $9.7 million of capitalized transaction costs plus $9.3 million of accrued interest. It does not include the fair value of derivative financial liabilities related to the Senior Secured Notes, which was $19.5 million as of June 30, 2014.	
(2)	Represents the principal amount of BRL 915 million minus net capitalized transaction costs of BRL 11.0 million, minus early prepayments of BRL 177.4 million, plus accrued interest of BRL 1.6 million, which results in an outstanding amount of BRL 728.2 million as of June 30, 2014, at an exchange rate of BRL 2.2025 to $1.00.	
(3)	Represents the fair value registered amount of ARS 666.8 million CVIs at the exchange rate of ARS 8.1538 to $1.00.	
(4)	Represents the €110.0 million outstanding aggregate principal amount of the Vendor Loan Note, minus early prepayments of €87.1 million, plus accrued interest of €0.1 million, which results in an outstanding amount of €23.0 million as of June 30, 2014, at the exchange rate of €0.7322 to $1.00.	
7.375% Senior Secured Notes Due 2020
On January 29, 2013, a subsidiary of the company, Atento Luxco, issued $300.0 million aggregate principal amount of Senior Secured Notes that mature on January 29, 2020. The Senior Secured Notes are senior secured obligations of Atento Luxco and are guaranteed on a senior secured first-priority basis by Atento Luxco and certain of its subsidiaries.
The indenture governing the Senior Secured Notes contains covenants that, among other things, restrict the ability of Atento Luxco and certain of its subsidiaries to: incur or guarantee additional indebtedness; pay dividends or make other distributions or redeem or repurchase capital stock; issue, redeem or repurchase certain debt; issue certain preferred stock or similar equity securities; make loans and investments; sell assets; incur liens; enter into transactions with affiliates; enter into agreements restricting certain subsidiaries’ ability to pay dividends; and consolidate, merge or sell all or substantially all of our assets. These covenants are subject to a number of important exceptions and qualifications. In addition, in certain circumstances, if Atento Luxco sells assets or experiences certain changes of control, it must offer to purchase the Senior Secured Notes. As of June 30, 2014, we were in compliance with these covenants. There are no other financial maintenance covenants under the indenture governing the Senior Secured Notes.
 
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For more information regarding the terms of the Senior Secured Notes, see “Description of Certain Indebtedness—7.375% Senior Secured Notes due 2020.”
Revolving Credit Facility
On January 28, 2013, Atento Luxco entered into a Super Senior Revolving Credit Facility (the “Revolving Credit Facility”), which provides for borrowings of up to €50 million ($69 million). The Revolving Credit Facility allows for borrowings in Euros, Mexican Pesos and U.S. dollars and includes borrowing capacity for letters of credit and ancillary facilities (including an overdraft, guarantee, bonding, documentary or stand-by letter of credit facility, a short term loan facility, a derivatives facility, and a foreign exchange facility). As at December 31, 2013, the Revolving Credit Facility remains undrawn.
The rate of interest under the Revolving Credit Facility is the percentage rate per annum which is the aggregate of (i) the applicable margin, (ii) EURIBOR or, in relation to any loan in a currency other than Euro, LIBOR or the applicable floating rate for Mexican Pesos and (iii) the mandatory cost (if any). The applicable margin is initially 4.50% per annum and is subject to a step-down based on a secured leverage ratio. In addition to paying interest on the outstanding principal amounts under the Revolving Credit Facility, we are required to pay a commitment fee of 40% of the applicable margin per annum in respect of the lenders unutilized commitments. The Revolving Credit Facility matures in July 2019.
The Revolving Credit Facility contains covenants similar to the Senior Secured Notes, which restrict (subject to the same exceptions as those in respect of the covenants relating to the Senior Secured Notes) our and our restricted subsidiaries’ ability to: incur or guarantee additional indebtedness; pay dividends or make other distributions or redeem or repurchase capital stock; issue, redeem or repurchase certain debt; issue certain preferred stock or similar equity securities; make loans and investments; sell assets; incur liens; enter into transactions with affiliates; enter into agreements restricting certain subsidiaries’ ability to pay dividends; and consolidate, merge or sell all or substantially all of our assets. As of June 30, 2014, we were in compliance with these covenants.
There are no other financial maintenance covenants under the Revolving Credit Facility.
For more information regarding the terms of the Revolving Credit Facility, see “Description of Certain Indebtedness—Super Senior Revolving Credit Facility.”
Brazilian Debentures
On November 22, 2012, BC Brazilco Participações, S.A. (now merged into Atento Brasil S.A.) (the “Brazilian Issuer”) entered into an indenture for the issuance of BRL 915 million (equivalent to approximately $365 million) of Brazilian Debentures due December 12, 2019. The Brazilian Debentures bear interest at a rate per annum equal to the average daily rate of the One Day “over extra-group”—DI—Interfinancial Deposits (as such rate is disclosed by CETIP S.A. – Mercados Organizados (“CETIP”) in the daily release available on its web page (http://cetip.com.br)), plus a spread of 3.70%.
The Brazilian Debentures contain the following amortization schedule: December 11, 2016—16.9%; December 11, 2017—22.3%; December 11, 2018—26.1%; and December 11, 2019—34.7%.
Under the terms of the Brazilian Debentures, we and our subsidiaries are required to be in compliance on a consolidated basis with a net leverage covenant which is tested on a quarterly basis subject to certain cure rights.
On March 25, 2013 and June 11, 2013, the Brazilian Issuer prepaid, BRL 72 million and BRL 26 million, respectively (equivalent to approximately $36 million and $12 million, respectively). On May 12, 2014 and June 26, 2014, Atento Brazil prepaid BRL 34.4 million and BRL 45.0 million, respectively (equivalent to
 
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$15.5 million and $20.4 million, respectively), of the Brazilian Debentures. The outstanding balance at amortized cost after the early repayments as of June 30, 2014 was BRL 728.2 million ($330.6 million), including accrued interest.
The Brazilian Issuer must comply with the quarterly net financial debt/EBITDA ratio set out in the contract terms. The contract also sets out additional restrictions, including limitations on dividends, payments and distributions to shareholders and capacity to incur additional debt. We were in compliance with all covenants under the Brazilian Debentures as of June 30, 2014.
For more information regarding the terms of the Brazilian Debentures, see “Description of Certain Indebtedness—Brazilian Debentures.”
Vendor Loan Note
On December 12, 2012, Midco issued the Vendor Loan Note for an aggregate principal amount of €110.0 million to an affiliate of Telefónica. The Vendor Loan Note has a scheduled maturity of December 12, 2022. Interest on the Vendor Loan Note accrues at a fixed rate of 5.00% per annum, and is payable annually in arrears. Interest on the Vendor Loan Note is payable in cash, if (i) no default (or similar event) is continuing or would arise under any financing documents of the Company, as defined in the agreement governing the Vendor Loan Note, as a result of such interest payment or any distribution or payment by a subsidiary to Midco to enable Midco to make the interest payment and (ii) the Company is able to lawfully upstream funds to Midco. Any interest that is not payable in cash is capitalized and added to the outstanding principal amount outstanding under the Vendor Loan Note. Interest is payable in cash only to the extent that the borrower has received upstream payments from its subsidiaries in excess of the lesser of (A) the expenses incurred during such interest period in connection with the operation of the Company plus management and advisory fees paid to Bain Capital Partners, LLC or (B) €35.0 million (increased by 3% for each subsequent interest period on a compounding basis). Additionally, following the sale of at least 66.66% of the business and assets of the Company, Midco shall be required to use the proceeds of such sale to repay the Vendor Loan Note, subject to items (i) and (ii) above. The Vendor Loan Note does not contain any other financial maintenance covenants.
On May 16, 2014, Midco entered into an amendment letter and certain other related documentation with the VLN Lender which provided for certain amendments to be made to the Vendor Loan Note including, amongst other, changes reducing the principal amount of the Vendor Loan Note by €25.4 million (equivalent to $34.9 million). In addition, a portion of the total principal amount outstanding under the Vendor Loan Note was also reduced during the six month period ended June 30, 2014 with the proceeds of the issuance of the PIK Notes due 2020.
The Vendor Loan Note is expressed by its terms to be senior to any debt or equity claim of the shareholders of Midco and their affiliates, pari passu with trade payables of Midco and subordinated to any other indebtedness of Midco. The Vendor Loan Note contains certain restrictions on payments by Topco and its subsidiaries to Bain Capital during the term of the Vendor Loan Note that are triggered if the ratio of financial indebtedness (as defined therein) to EBITDA for Topco and its subsidiaries is greater than 2.5 to 1.0.
As of June 30, 2014, we were in compliance with the terms of the Vendor Loan Note.
For more information regarding the terms of the Vendor Loan Note, see “Description of Certain Indebtedness—Vendor Loan Note.”
Contingent Value Instruments
In relation to the Acquisition, two of our indirect subsidiaries, Atalaya Luxco 2, S.à r.l., (formerly BC Luxco 2, S.à r.l.) and Atalaya Luxco 3, S.à r.l, (formerly BC Luxco 3, S.à r.l.), which own the Atento Group’s Argentinian subsidiaries, issued the Contingent Value Instruments to Atento Inversiones y Teleservicios, S.A.
 
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and Venturini S.A., which are Telefónica subsidiaries. The CVIs together have an aggregate par value of ARS 666.8 million (equivalent to approximately $102.3 million). The CVIs are the senior obligations of Atalaya Luxco 2, S.à r.l. and Atalaya Luxco 3, S.à r.l. only (and not any other members of the Company group) and are subject to mandatory (partial) repayment in the following scenarios: if in any financial year an Argentinian subsidiary has excess cash, being an amount equal to 90% of its cash in such financial year that is available to be lawfully distributed by such Argentinian subsidiary and can be settled without restriction, less: (1) the greater of: (A) a specified cash amount in respect of such Argentinian subsidiary as set out in each CVI; and (B) the amount that such Argentinian subsidiary needs in order to meet its financial obligations; and (2) an amount equal to (i) expenses incurred in distributing such excess cash (e.g. taxes and reasonable third party costs); (ii) a sale of all or substantially all of the shares or the assets of the Argentinian subsidiaries to a non-affiliated party; (iii) a sale, directly or indirectly, of all or substantially all of the shares or the assets of Atento Luxco by Bain Capital to a non-affiliated party; and (iv) a distribution, payment or repayment made by any Argentinian subsidiary to Atalaya Luxco 2, S.à r.l. or Atalaya Luxco 3, S.à r.l, in respect of the securities of such Argentinian subsidiary. The CVI does not contain any other financial maintenance convents. As of June 16, 2014, we were in compliance with the terms of the CVI.
The CVIs do not accrue interest and are recognized at fair value. As of June 30, 2014, the fair value of the CVIs was $36.4 million. See Note 3(s) “Fair Value of Derivatives and CVI” to the Successor financial statements for additional information. Under the terms of each CVI, Atalaya Luxco 2, S.à r.l. and Atalaya Luxco 3, S.à r.l. have the right to off-set certain amounts specified in the SPA (in the circumstances specified in the SPA) against the outstanding balance under such CVI.
The obligations of Atalaya Luxco 2, S.à r.l. and Atalaya Luxco 3, S.à r.l. under each CVI will be extinguished on the earlier of: (i) the date on which the outstanding balance under such CVI is reduced to zero (in respect of repayment of outstanding debt or reduction of the outstanding balance pursuant to the terms and conditions of the CVIs); and (ii) December 12, 2022. During the term of the CVIs, the CVI holders have preferential purchase rights in the event the Argentinian subsidiaries are sold.
The obligations under the CVIs are not guaranteed by any subsidiary other than Atalaya Luxco 2, Atalaya Luxco 3 and its Argentinian subsidiaries.
For more information regarding the terms of the CVIs, see “Description of Certain Indebtedness—Contingent Value Instruments.”
Preferred Equity Certificates
On December 3, 2012, in connection with the Acquisition, Midco authorized the issuance of three series of Preferred Equity Certificates (the “Original Luxco PECs”), which were subscribed by Topco, totaling $532.7 million as of June 30, 2014 ($519.6 million as of December 31, 2013). As part of the insertion of PikCo into our corporate structure (see “Prospectus Summary—Our History and Corporate Structure—The Reorganization Transaction”), on May 30, 2014, Midco authorized the issuance of, and PikCo subscribed for, a fourth series of Preferred Equity Certificates (together with the Original Luxco PECs, the “Luxco PECs”) which were subscribed by PikCo, totaling $88.0 million as of June 30, 2014. The terms of the Luxco PECs are as follows:
 
 	•	 	Series 1: Midco authorized the issuance of 50,000,000,000 Series 1 PECs with a par value of €0.01 each. These Luxco PECs mature after 30 years, but may be withdrawn prior to this date in certain scenarios, and accrue interest at an annual rate of 8.0309%, which capitalizes annually if not paid in cash. As of December 31, 2013 and 2012, Midco has issued 23,580,000,000 Series 1 PECs for an aggregate amount of $325.2 million and $311.1 million, respectively. The resulting interest was capitalized on December 3, 2013 totalling approximately $26.1 million. The interest accrued at December 31, 2013 totaled approximately $2.2 million. The aggregate amount of Series 1 PECs as of June 30, 2014 was $348.3 million. The interest accrued at June 30, 2014 totaled approximately $16.2 million.	
 
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 	•	 	Series 2: Midco authorized the issuance of up to 200,000 Series 2 PECs with a par value of €0.01 each. These Luxco PECs mature after 30 years, but may be withdrawn prior to this in certain scenarios. The yield is equal to the profit recognized for Luxembourg generally accepted accounting practice in connection with the “Specified Assets” (meaning the investment of the Company in the Luxco 1 Series 2 PECs, as defined), less any loss recognized in connection with the Specified Assets less a proportional amount of any direct expense borne by the Company during the Accrual Period in relation to the Specified Assets and less the losses of the Company in relation to the Specified Assets during the Accrual Period, including any such losses carried forward from previous Accrual Periods, such amount then divided by the number of Series 2 PECs outstanding at that time. As of June 30, 2014 and December 31, 2013, Midco had issued 200,000 Series 2 PECs for an aggregate amount of $3.0 thousand. The interest accrued at June 30, 2014 totaled approximately $4.1 million.	
 
 	•	 	Series 3: Midco authorized the issuance of up to 25,000,000,000 Series 3 PECs with a par value of €0.01 each. These Luxco PECs mature after 60 years, but may be withdrawn prior to this in certain scenarios. The yield is equal to the “Specified Income” (meaning the sum of all income and capital gains derived by the Company from the Eligible Assets (investment by the Company in the shares of Atento Luxco) less losses of the Company carried forward less all other expenses of the Company connected to the investment in the Eligible Assets (as defined in the terms and conditions of the Series 3 PECs) for each accounting period comprised in such “Accrual Period” (as defined in the terms and conditions of the Series 3 PECs) divided by 365 (or if a leap year, 366) and, respectively in the case of each such number so ascertained, multiplied by the number of days of each such accounting period that comprised that Accrual Period, then divided by the number of Series 3 PECs outstanding at that time. As of June 30, 2014, Midco had issued 12,017,800,000 Series 3 PECs for an aggregate amount of $164.1 million ($165.7 million as of December 31, 2013).	
 
 	•	 	Series 4: Midco authorized the issuance of up to 50,000,000,000 Series 4 PECs with a par value of €0.01 each. These Luxco PECs mature after 30 years, but may be withdrawn prior to this date in certain scenarios, and accrue interest at an annual rate of 5%, which capitalizes annually if not paid in cash. At June 30, 2014, the Company had issued 6,414,652,564 Series 4 PECs for an aggregate amount of €64.2 million, equivalent of $87.6 million. The interest accrued at June 30, 2014 totaled approximately $0.4 million.	
Prior to the completion of this offering, Topco will transfer its entire interest in the Issuer (equal to €31,000 of share capital) to PikCo, Topco’s direct subsidiary, the consideration for which will be an allocation to PikCo’s Reserve Account equal to €31,000. PikCo will then make the Contribution of all of its debt interests in Midco, which comprises the LuxCo PECs, to Midco, the consideration for which will be an allocation to Midco’s Reserve Account equal to the value of the LuxCo PECs immediately prior to the Contribution. Upon completion of the Contribution, the Luxco PECs will be cancelled by Midco. PikCo will then transfer the remainder of its interest in Midco (being €12,500 of share capital) to the Issuer, in consideration for which the Issuer will issue two new shares to PikCo. The difference between the nominal value of these shares and the value of Midco’s net equity will be allocated to the Issuer’s share premium account. As a result of such transfer, Midco will become a direct subsidiary of the Issuer.
The Luxco PECs are classified as subordinated debt with respect to our other present and future obligations. The table below provides a summary of Luxco PECs principal balance and their movements in 2013:

($ in millions)
Luxco PECs	  	Maturity	 	  	December 31,
2012	 	  	Interest
capitalized	 	  	Translation
differences	 	  	Interest
accrued	 	  	December 31,
2013	 	
Series 1 PECs	  	 	2042	  	  	 	311.1	  	  	 	26.1	  	  	 	14.5	  	  	 	2.2	  	  	 	353.9	  	
Series 2 PECs	  	 	2042	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	
Series 3 PECs	  	 	2072	  	  	 	158.6	  	  	 	—	  	  	 	7.2	  	  	 	—	  	  	 	165.7	  	
	  				  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  				  	 	469.7	  	  	 	26.1	  	  	 	21.6	  	  	 	2.2	  	  	 	519.6	  	

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The table below provides a summary of Luxco PECs principal balance and their movements during the six months ended June 30, 2014:

($ in millions)
Luxco PECs	  	Maturity	 	  	December 31,
2013	 	  	Issuance	 	  	Translation
differences	 	 	Interest
accrued	 	  	June 30,
2014	 	
 	  	 	 	  	 	 	  	 	 	  	 	 	 	 	 	  	(Unaudited)	 	
Series 1 PECs	  	 	2042	  	  	 	353.9	  	  	 	—	  	  	 	(3.5	) 	 	 	14.1	  	  	 	364.5	  	
Series 2 PECs	  	 	2042	  	  	 	—	  	  	 	—	  	  	 	—	  	 	 	4.1	  	  	 	4.1	  	
Series 3 PECs	  	 	2072	  	  	 	165.7	  	  	 	—	  	  	 	(1.6	) 	 	 	—	  	  	 	164.1	  	
Series 4 PECs	  	 	2044	  	  	 	—	  	  	 	87.3	  	  	 	0.3	  	 	 	0.4	  	  	 	88.0	  	
	  				  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	
Total	  				  	 	519.6	  	  	 	87.3	  	  	 	(4.8	) 	 	 	18.6	  	  	 	620.7	  	
	  				  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	
Brazil BNDES Credit Facility
On February 3, 2014, Atento Brasil S.A. entered into a credit agreement with Banco Nacional de Desenvolvimento Econômico e Social—BNDES (“BNDES”) in an aggregate principal amount of BRL 300 million (the “BNDES Credit Facility”), equivalent to $124 million.
The total amount of the BNDES Credit Facility is divided into five tranches in the following amounts and subject to the following interest rates:

 	  	Amount of Each
Tranche	  	Interest Rate	
Tranche A	  	BRL 182,330,000.00	  	Long Term Interest Rate (Taxa de Juros de Longo Prazo—TJLP) plus 2.5% per annum	
Tranche B	  	BRL 45,583,000.00	  	SELIC Rate plus 2.5% per annum	
Tranche C	  	BRL 64,704,000.00	  	4.0% per year	
Tranche D	  	BRL 5,296,000.00	  	6.0% per year	
Tranche E	  	BRL 2,048,000.00	  	Long Term Interest Rate (Taxa de Juros de Longo Prazo—TJLP)	
The BNDES Credit Facility is to be repaid in 48 monthly installments. The first payment will be due on March 15, 2016 and the last payment will be due on February 15, 2020.
The BNDES Credit Facility contains covenants that restrict Atento Brasil S.A.’s ability to transfer, assign, charge or sell the intellectual property rights related to technology and products developed by Atento Brasil S.A. with the proceeds from the BNDES Credit Facility. As of June 30, 2014, we were in compliance with these covenants. The BNDES Credit Facility does not contain any other financial maintenance covenants.
The BNDES Credit Facility contains customary events of default including the following: (i) reduction of the number of the employees of Atento Brasil S.A. without providing program support for outplacement, as training, job seeking assistance and obtaining pre-approval of BNDES, (ii) existence of an unfavorable court decision against the Company for the use of children as workforce, slavery or any environmental crimes and (iii) inclusion in the by-laws of Atento Brasil S.A. of any provision that restricts Atento Brasil S.A.’s ability to paying its obligations under the BNDES Credit Facility.
Other Loan Agreements
On June 28, 2011, Atento arranged a loan with Banco Sabadell for an amount of 21.2 million Moroccan Dirhams maturing on June 28, 2016 with an annual rate of interest of 6%. As of June 30, 2014, the principal loan balance was 4.6 million dirhams ($0.6 million).
 
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Finance Leases
The Company holds the following assets under finance leases:

 	  	As of December 31,	 	  	As of June 30,
2014	 	
 	  	2012	 	  	2013	 	  			
($ in millions)	  	Net
carrying
amount
of asset	 	  	Net
carrying
amount
of asset	 	  	Net
carrying
amount
of asset	 	
 	  	 	 	  	 	 	  	(unaudited)	 	
Finance leases	  				  				  				
Plant and machinery	  	 	0.5	  	  	 	—	  	  	 	—	  	
Furniture, tools and other tangible assets	  	 	8.8	  	  	 	9.4	  	  	 	10.3	  	
Software	  	 	1.3	  	  	 	—	  	  	 	—	  	
Other intangible assets	  	 	3.5	  	  	 	—	  	  	 	—	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	14.1	  	  	 	9.4	  	  	 	10.3	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
The assets acquired under finance leases are located in Brazil, Uruguay, Colombia and Peru.
The present value of future finance lease payments is as follows:

 	  	As of
December 31,	 	  	As of
June 30,
2014	 	
($ in millions)	  	2012	 	  	2013	 	  			
 	  	 	 	  	 	 	  	(unaudited)	 	
Up to 1 year	  	 	3.5	  	  	 	5.3	  	  	 	5.7	  	
Between 1 and 5 years	  	 	5.2	  	  	 	6.5	  	  	 	4.2	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	8.7	  	  	 	11.9	  	  	 	9.9	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Derivative Financial Instruments
For a description of our derivative financial instruments as of December 31, 2013, see Note 14 to the Successor financial statements. For a description of our derivative financial instruments as of June 30, 2014, see Note 10 to the Interim financial statements. See also “—Quantitative and Qualitative Disclosures About Market Risks—Interest Rate Risk” and “—Quantitative and Qualitative Disclosures About Market Risks—Foreign Currency Risk” for additional information on fair market value of certain of our derivative financial instruments.
Off-Balance Sheet Arrangements
We do not have any off-balance sheet arrangements other than operating leases and guarantees.
The following table shows the increase in the number of the customers performance guarantees we have provided to third parties as part of our ordinary course of business for the periods indicated. Of these guarantees, the majority relate to commercial purposes and rental activities, the bulk of the remaining guarantees relates to tax and labor-related procedures.
There has not been any material instance of a guarantee being drawn upon for the periods indicated, nor does management anticipate any liability as a result of a draw upon a guarantee in the future.

 	  	Year ended December 31,	 	  	As of
June 30,
2014	 	
($ in millions)	  	2011	 	  	2012	 	  	2013	 	  			
 	  	 	 	  	 	 	  	 	 	  	(unaudited)	 	
Financial, labor-related, tax and rental transactions	  	 	113.2	  	  	 	94.8	  	  	 	97.4	  	  	 	248.5	  	
Contractual obligations	  	 	32.7	  	  	 	55.9	  	  	 	135.8	  	  	 	145.6	  	
Other	  	 	1.4	  	  	 	0.1	  	  	 	0.2	  	  	 	0.0	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	147.3	  	  	 	150.8	  	  	 	233.4	  	  	 	394.1	  	

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The change over time in the amount of the performance guarantees granted to third parties has been caused by an increase in guarantees we deliver to clients in connection with agreements under which we provide our services. The change in the amount of the financial guarantees during the six months ended June 30, 2014 was principally due to the guarantees granted in connection with the BNDES financing. See Note 22 to the Predecessor financial statements, Note 25(a) to the Successor financial statements and Note 16 to the Interim financial statements for further information with respect to the guarantees for the periods indicated.
Contractual Obligations
The following table presents our expected future cash outflows resulting from debt obligations, finance lease obligations, operating lease obligations and other long-term liabilities as of December 31, 2013.

 	  	As of December 31, 2013	 	
 	  	Payments due by period	 	
($ in millions) (unaudited)	  	Total	 	  	Less than
1 year	 	  	1-3 years	 	  	3-5 years	 	  	More than
5 years	 	
Debt Obligations	  	 	1,374.8	  	  	 	11.8	  	  	 	85.8	  	  	 	150.3	  	  	 	1,126.9	  	
Finance Lease Obligations	  	 	11.9	  	  	 	5.3	  	  	 	5.3	  	  	 	1.3	  	  	 	—	  	
Operating Lease Obligations	  	 	294.7	  	  	 	90.9	  	  	 	106.3	  	  	 	64.4	  	  	 	33.1	  	
Purchase Obligations	  	 	270.8	  	  	 	269.8	  	  	 	1.0	  	  	 	—	  	  	 	—	  	
Total Obligations (1)	  	 	1,952.2	  	  	 	377.8	  	  	 	198.4	  	  	 	216.0	  	  	 	1,160.0	  	

(1)	We also have other non-current liabilities totalling $102.4 million.	
Debt obligations are comprised of debentures and bonds, interest bearing loans and borrowings, CVIs (based on the fair value as of December 31, 2013; see Note 17 to the Successor financial statements), Vendor Loan Note and the PECs. The debentures and bonds balance consists of the Senior Secured Notes and the Brazilian debentures outstanding balance as of December 31, 2013.
The payables to group companies are comprised of the following: (i) three series of Preferred Equity Certificates issued by Midco and subscribed by Topco, totaling $517.4 million as of December 31, 2013 ($469.7 million in 2012); and (ii) interest accruing pending payment in the amount of $2.2 million as of December 31, 2013 ($1.9 million in 2012).
We enter into finance lease arrangements related to furniture, tools and other tangible assets. Our main increases in finance lease arrangements relate to equipment acquired in Colombia and Peru in order to improve and upgrade our infrastructure. Our assets acquired under finance leases are located in Brazil, Uruguay, Colombia and Peru.
The operating leases where we act as lessee are mainly on premises used as call centers. These leases have various termination dates, with the latest in 2023. There were no contingent payments on operating leases recognized in the consolidated income statements for the years ended December 31, 2013. Further, at December 31, 2013, the payment commitment for the early cancellation of these leases amounts to $147.9 million.
Purchase obligations include trade and other payables mainly related to suppliers and advances provided to personnel.
Capital Expenditures
Our business has significant capital expenditure requirements, including construction and initial fit-out of our service delivery centers, improvements and refurbishment of leased facilities for our service delivery centers, acquisition of various items of property, plant and equipment, mainly comprised of furniture, computer equipment and technology equipment, acquisition and upgrades of our software or specific customer’s software.
The funding of the majority of our capital expenditures is covered by existing cash and EBITDA generation.
 
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The table below sets forth our historic capital expenditures by segment for the years ended December 31, 2013, 2012 and 2011 and for the six months ended June 30, 2013 and 2014.

 	 	Predecessor	 	 	  	 	Successor	 	 	Non-IFRS
Aggregated	 	 	Successor	 	
 	 	Year ended
December 31,
2011	 	 	Period from
Jan 1 - Nov 30,
2012	 	 	  	 	Period from
Dec 1 - Dec 31,
2012	 	 	Year ended
December 31,
2012
(unaudited)	 	 	Year ended
December 31,
2013	 	 	Six months
ended
June 30,
2013
(unaudited)	 	 	Six months
ended
June 30,
2014
(unaudited)	 	
($ in millions)	 			 			 	  	 			 			 			 			 			
Brazil	 	 	52.6	  	 	 	55.4	  	 	 	 	 	10.3	  	 	 	65.7	  	 	 	63.2	  	 	 	19.3	  	 	 	28.2	  	
Americas	 	 	37.2	  	 	 	11.4	  	 	 	 	 	12.3	  	 	 	23.7	  	 	 	31.8	  	 	 	7.1	  	 	 	9.7	  	
EMEA	 	 	49.6	  	 	 	9.7	  	 	 	 	 	4.0	  	 	 	13.7	  	 	 	7.2	  	 	 	1.9	  	 	 	2.5	  	
Other and eliminations	 	 	2.2	  	 	 	0.4	  	 	 	 	 	1.8	  	 	 	2.2	  	 	 	0.8	  	 	 	0.4	  	 	 	0.2	  	
Total capital expenditures	 	 	141.6	  	 	 	76.9	  	 	 	 	 	28.4	  	 	 	105.3	  	 	 	103.0	  	 	 	28.7	  	 	 	40.6	  	
For 2014, we expect to incur in levels of capital expenditures broadly in line with the last two years, for purchases related to the items described above to support the growth of our business and regular maintenance capital expenditures.
We expect that our capital expenditures will increase in the future as our business continues to develop and expand.
Critical Accounting Policies and Estimates
The preparation of financial statements in accordance with IFRS as issued by the IASB requires the use of certain assumptions and estimates that affect the amount of assets, liabilities, income, and expenses in our consolidated financial statements and accompanying notes. Some of the accounting policies applied in preparing our consolidated financial statements require our management to apply significant judgments in order to select the most appropriate assumptions for determining these estimates. These assumptions and estimates are based on our historical experience, the advice of consultants and experts, forecasts and other circumstances and expectations prevailing at year end, and our management’s evaluation of the global economic situation in the CRM BPO services segment, as well as the future outlook for the business. By virtue of their nature, these judgments are inherently subject to uncertainty, consequently, actual results could differ substantially from the estimates and assumptions used. Should this occur, the values of the related assets and liabilities would be adjusted accordingly. Our significant accounting policies, which may be affected by our estimates and assumptions, are discussed further in Note 3 to the Successor financial statements and our Interim financial statements included in this prospectus.
Although these estimates were made on the basis of the best information available at each reporting date on the events analyzed, events that take place in the future might make it necessary to change these estimates in coming years. Changes in accounting estimates would be applied prospectively in accordance with the requirements of IAS 8, recognizing the effects of the change in estimates in the related consolidated statement of comprehensive income.
Summarized below are those of our accounting policies where management believes the nature of the estimates or assumptions involved is material due to the levels of subjectivity and judgment necessary to account for highly uncertain matters or the susceptibility of such matters to change.
Revenue Recognition
Revenue is recognized on the basis of the actual service provided as a percentage of the total service to be provided, when the revenues and costs of the services contract, as well as the stage of completion thereof, can be
 
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reliably estimated and it is probable that the related receivables will be recovered. Recognition of revenues on the basis of their stage of completion calls for the use of estimates relating to certain features of the service contracts such as costs of the contract, the period of realization and provisions in connection with the contract.
We take account of our past experience and specific quantitative indicators for our estimates, in due consideration of the specific circumstances applicable to specific customers or contracts. In the event of circumstances that may have an effect on the revenue originally forecast, the costs or the stage of completion, estimates are revised accordingly. Revisions may affect the revenues and expenses recognized.
Acquisition Accounting
We account for our business acquisitions under the acquisition method of accounting. The consideration given for the acquisition of a subsidiary is understood to correspond to the fair value of the assets transferred, the liabilities assumed vis-à-vis the former owners of the acquiree, and any equity instruments therein issued by the Company. The consideration given includes the fair value of any asset or liability stemming from any contingent consideration agreement.
Any contingent consideration to be transferred by the Company is recognized at fair value at the acquisition date. Subsequent changes in the fair value of any contingent consideration deemed an asset or a liability are recognized in income or as a change in other comprehensive income, in accordance with IAS 39. Contingent consideration classified as equity is not remeasured, and any subsequent settlement thereof is also recognized in equity. Costs related with the acquisition are recognized as expenses in the year incurred.
Identifiable assets acquired and identifiable liabilities and contingent liabilities assumed in a business combination are initially measured at fair value at the acquisition date.
Goodwill is initially measured as any excess of total consideration given over the net identifiable assets acquired and liabilities assumed. If the fair value of the net assets acquired is greater than the aggregate consideration transferred, the difference is recognized on the income statement.
Refer to Note 5 to the Successor financial statements for further discussion of the Acquisition.
Useful life of Property, Plant and Equipment and Intangible Assets
As of June 30, 2014, net property, plant and equipment totaled $243.1 million and net identifiable finite-lived intangible assets totaled $347.4 million. The accounting treatment of property, plant and equipment and intangible assets entails the use of estimates to determine their useful life for depreciation and amortization purposes. In determining useful life, it is necessary to estimate the level of use of assets as well as forecast technological trends in the assets. Assumptions regarding the level of use, the technological framework and the future development require a significant degree of judgment, bearing in mind that these aspects are rather difficult to foresee. The useful lives of intangible assets are assessed on a case-by-case basis to be either finite or indefinite. Intangible assets with finite lives are amortized on a straight-line basis over their estimated useful life and assessed for impairment whenever events or changes indicate that their carrying amount may not be recoverable. As described in Note 7 to our Interim financial statements, during the six months ended June 30, 2014, we recorded an impairment charge of $28.0 million on our intangible assets due to certain amendments to the MSA with Telefónica. We have no assets with an indefinite useful life.
Changes in the level of use of assets or in their technological development could result in a modification of their useful lives and, consequently, in the associated depreciation or amortization.
 
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Estimated Impairment of Goodwill
We test goodwill for impairment annually, in accordance with the accounting policy described in Note 3(f) to the Predecessor and Note 3(h) to the Successor financial statements, respectively. Goodwill is subject to impairment testing as part of the cash-generating unit or the group of cash-generating units to which it has been allocated. The recoverable amounts of cash-generating units defined in order to identify potential impairment of goodwill are determined on the basis of value in use, applying five-year financial forecasts based on the our strategic plans, approved and reviewed by our management. These calculations entail the use of assumptions and estimates, and require a significant degree of judgment. The main variables considered in the sensitivity analyses are growth rates, discount rates using the weighted average cost of capital (WACC) and the key business variables. As of June 30, 2014, goodwill totaled $187.7 million. As described in Note 7 to the Interim financial statements, during the six months ended June 30, 2014, we recorded an impairment charge of $4.9 million on the goodwill related with Spain and the Czech Republic due to certain amendments to the MSA with Telefónica and changes in the expected revenue from the countries in which we operate. No impairment to goodwill was recognized in 2013, 2012 or 2011.
Deferred Taxes
We assess the recoverability of deferred tax assets based on estimates of future earnings. The ability to recover these deferred amounts depends ultimately on our ability to generate taxable earnings over the period in which the deferred tax assets remain deductible. This analysis is based on the estimated timing of the reversal of deferred tax liabilities, as well as estimates of taxable earnings, which are sourced from internal projections and are continuously updated to reflect the latest trends.
The appropriate classification of tax assets and liabilities depends on a series of factors, including estimates as to the timing and realization of deferred tax assets and the projected tax payment schedule. Actual income tax receipts and payments could differ from the estimates made by us as a result of changes in tax legislation or unforeseen transactions that could affect tax balances.
We have recognized tax credits corresponding to loss carry-forwards since based on internal projections it is probable there will be future taxable profits against which they may be utilized.
We have capitalized our tax carry-forward losses based on our internal forecasts, considering probable to have enough future benefits to recover them.
Provisions
Provisions are recognized when we have a present obligation as a result of a past event, it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. This obligation may be legal or constructive, deriving from, inter alia, regulations, contracts, customary practice or public commitments that lead third parties to reasonably expect that we will assume certain responsibilities. The amount of the provision is determined based on the best estimate of the outlay required to settle the obligation, bearing in mind all available information at the reporting date, including the opinions of independent advisors such as legal counsel or consultants.
No provision is recognized if the amount of liability cannot be estimated reliably. In such a case, the relevant information would be provided in the notes to the financial statements.
Given the uncertainties inherent in the estimates used to determine the amount of provisions, actual outflows of resources may differ from the amounts recognized originally on the basis of the estimates.
 
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Fair Value of Derivatives
We use derivative financial instruments to mitigate risks, primarily derived from possible fluctuations in interest rates on loans received. Derivatives are recognized at the onset of the contract at fair value, subsequently re-measuring the fair value and adjusting as necessary at each reporting date.
The fair value of derivative financial instruments is calculated on the basis of observable market data available, either in respect of market prices or through the application of valuation techniques. The valuation techniques used to calculate the fair value of derivative financial instruments include the discounting of future cash flows associated with the instruments, applying assumptions based on market conditions at the valuation date or using prices established for similar instruments, among others. These estimates are based on available market information and appropriate valuation techniques. The fair values calculated could differ significantly if other market assumptions and/or estimation techniques were applied.
Recent Accounting Pronouncements
We believe there are no relevant standards or relevant interpretations mandatory for the current accounting period that have not been applied.
Certain new standards, amendments and interpretations to existing standards have been published but are not mandatory for our Interim financial statements. We have not early adopted these revisions to IFRS. Many of these updates are not applicable to us and have excluded from the discussion below:
 
 	•	 	IFRS 9 ‘Financial Instruments’ addresses the classification, measurement and recognition of financial assets and financial liabilities. IFRS 9 was issued in November 2009 and October 2010. It replaces the parts of IAS 39 that relate to the classification and measurement of financial instruments. IFRS 9 requirements financial assets to be classified into two measurement categories: those measured as at fair value and those measures at amortized cost. The determination is made at initial recognition the classification depends on the entity’s business model for managing its financial instruments and the contractual cash flow characteristics of the instruments. For financial liabilities, the standard retains most of the IAS 39 requirements. The main change is that, in cases where the fair value option is taken for financial liabilities, the part of a fair value change due to an entity’s own credit risk is recoded in other comprehensive income rather than the statement of operations, unless this creates an accounting mismatch.	
 
 	•	 	IFRS 14 ‘Regulatory Deferral Accounts’ permits an entity which is a first-time adopter of IFRS to continue to account, with some limited changes, for ‘regulatory deferral account balances’ in accordance with its previous GAAP, both on initial adoption of IFRS and in subsequent financial statements. Regulatory deferral account balances, and movements in them, are presented separately in the statement of financial position and statement of profit or loss and other comprehensive income, and specific disclosures are required.	
 
 	•	 	Amendment to IAS 19 Revised ‘Employment Benefits’ related to contributions from employees or third parties that are linked to service. The amendment notes that if the amount of the contributions is independent of the number of years of service, an entity is permitted to recognize such contributions as a reduction in the service cost in the period in which the related service is rendered, instead of attributing the contributions to the periods of service. Examples of contributions that are independent of the number of years of service include those that are a fixed percentage of the employee’s salary, a fixed amount throughout the service period or dependent on the employee’s age. However, if the amount of the contributions is dependent on the number of years of service, an entity is required to attribute those contributions to periods of service using the same attribution method required by paragraph 70 of IAS 19 for the gross benefit (i.e. either using the plan’s contribution formula or on a straight-line basis). These changes are effective for annual periods beginning on or after July 1, 2014.	
 
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 	•	 	Amendment to IAS 39 ‘Novation of Derivatives and Continuation of Hedge Accounting,’ effective for annual periods. The amendment clarifies that an entity is required to discontinue the hedge accounting for a derivative that has been designated as a hedging instrument in an existing hedging relationship if the derivative is novated to a central counterparty and the new derivative, with a counterparty being the central counterparty, is to be recognized at the time of the novation.	
 
 	•	 	Annual improvements to IFRSs 2010-2012 cycle, effective for annual periods beginning on or after July 1, 2014.	
 
 	•	 	Annual improvements to IFRSs 2011-2013 cycle, effective for annual periods beginning on or after July 1, 2014.	
The adoption of the pronouncements and amendments described above are not anticipated to have a material impact on our operations results and our financial position. See Note 2 to the Successor financial statements and Note 4 to the Interim financial statements for further information on our basis of preparation of the consolidated financial statements.
Quantitative and Qualitative Disclosures About Market Risks
In the ordinary course of our business, we are exposed to a variety of market risks that are typical for the industry and sectors in which we operate. The principal market risks that affect our financial position, results of operations and prospects relate to foreign exchange. We do not enter into or deal in market sensitive instruments for trading or speculative purposes. Our overall risk management strategy focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on our financial performance. As part of our risk management strategy, we use derivatives to limit both interest and foreign currency risks on otherwise unhedged positions and to adapt our debt structure to market conditions. While management has adopted a number of mitigation strategies to limit our exposure to market related risks, we cannot assure you that any mitigation strategies will be effective or that we will not be materially adversely affected by such risks in future periods. See Note 4 to the Successor financial statements for additional information on market risk.
Country Risk
To manage or mitigate country risk, we repatriate the funds generated in Latin America that are not required for the pursuit of new, profitable business opportunities in the region and subject to the restrictions of our financing agreements. The capital structure of the Atento Group comprises two separate ring-fenced financings: (i) the Brazilian Debentures and (ii) the U.S.$300 million 7.375% Senior Secured Notes due 2020, together with the €50 million ($69 million) Revolving Credit Facility. The Brazilian term loan is denominated in Brazilian reais and our obligations are paid with cash flows from our Atento Brazil revenue in Brazilian reais. This creates a natural hedge for debt commitments eliminating any foreign exchange risk. In addition, in connection with the issuance of the Senior Secured Notes in U.S. dollars we entered into a series of cross currency swaps derivatives agreements, effectively hedging 90% of the related interest payments in Euros, Mexican Pesos, Colombian Pesos and Peruvian Soles, and 75% of the principal exposure in Euros and Mexican Pesos.
Argentinean subsidiaries are not party to these two separate ring-fenced financings, and we do not rely on cash flows from these operations to serve our debt commitments entered into in connection with the Acquisition.
Interest Rate Risk
Interest rate risk arises mainly as a result of changes in interest rates which affect: finance costs of debt bearing interest at variable rates (or short-term maturity debt expected to be renewed), as a result of fluctuations in interest rates, and the value of non-current liabilities that bear interest at fixed rates. Our exposure to interest rate risk arises principally from interest on our indebtedness. As of December 31, 2013, we had total consolidated indebtedness of approximately $1,370.8 million, of which approximately 43.2% (excluding CVIs and the PECs)
 
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bears interest at variable rates. As of June 30, 2014, we had total consolidated indebtedness of approximately $1,366.0 million, of which approximately 50.7% (excluding CVIs and the PECs) bears interest at variable rates.
As of March 31, 2014, we have outstanding indebtedness of approximately $1,417.2 million pursuant to which we must make payments determined on the basis of variable interest rates, predominantly tied to the Brazilian CDI (Interbank Deposit Certificate) rate.
As of December 31, 2013, the estimated fair value of the interest rate hedging instruments related to the Brazilian Debentures totaled $15.6 million, which was recorded as a financial asset. Based on our total indebtedness of $1,370.8 million as of December 31, 2013 and not taking into account the impact of our interest rate hedging instruments referred to above, a 1% change in interest rates would impact our net interest expense by $3.8 million.
As of June 30, 2014, the estimated fair value of the interest rate hedging instruments related to the Brazilian Debentures totaled $10.3 million, which was recorded as a financial asset. Based on our total indebtedness of $1,366.0 million as of June 30, 2014 and not taking into account the impact of our interest rate hedging instruments referred to above, a 1% change in interest rates would impact our net interest expense by $1.7 million.
Foreign Currency Risk
Our exposure to market risk arises principally from exchange rate risk. While the U.S. dollar is our reporting currency, approximately 98% of our revenue for the year ended December 31, 2013 was generated in local currencies other than the U.S. dollar. In addition to the U.S. dollar, we also generate significant revenues in Brazilian reais, Euros and Mexican pesos. The exchange rates among the U.S. dollar and these local currencies have changed substantially in recent years and may fluctuate substantially in the future. Our exchange rate risk arises from our local currency revenues, receivables and payables. We benefit to a certain degree from the fact that the revenue we collect in each country in which we have operations is generally denominated in the same currency as the majority of the expenses we incur in earning this revenue.
In accordance with our risk management policy, whenever we deem it appropriate, we manage foreign currency risk by using derivatives to hedge any debts incurred in currencies other than those of the countries where the companies taking on the debt are domiciled.
Upon closing of the Senior Secured Notes issued in U.S. dollars, we entered into cross-currency interest rate swaps pursuant to which we exchanged an amount of U.S. dollar equal to the face amount of the Senior Secured Notes for an amount of Euro, Mexican Pesos, Colombian Pesos and Peruvian Soles. On each interest payment date under the Senior Secured Notes, we receive from the applicable swap counterparty an amount in U.S. dollar equal to a semi-annual amount of interest at a rate per year equal to the interest rate payable on the Senior Secured Notes and calculated based on the amount of U.S. dollars initially exchanged by us under the currency swap and we will pay to the applicable swap counterparty an amount in the applicable other currency equal to a semi-annual amount of interest at a per annum rate equal to the benchmark floating rate for currency swaps for the applicable semi-annual period. Finally, on the maturity date of each currency swap, we will receive from the applicable swap counterparty U.S. dollars in an amount equal to the initial U.S. dollar exchange amount for such currency swap and will pay to the applicable swap counterparty the applicable other currency in an amount equal to the initial foreign currency exchange amount for such currency swap. As of June 30, 2014, the estimated net fair value of the interest rate hedge instruments related to the cross-currency swaps entered into to hedge the Senior Secured Notes totaled $17.7 million ($13.3 million, as of December 31, 2013) of which $19.5 million ($16.0 million as of December 31, 2013) was recorded as long-term financial debt and $1.8 million ($2.7 million as of December 31, 2013) was recorded as long-term financial assets.
 
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Credit Risk
Financial instruments that potentially subject us to concentrations of credit risk consist principally of accounts receivable, cash and cash equivalents, and long-term financial assets. Our maximum exposure to credit risk on financial assets is the carrying amount of said assets. Our commercial credit risk management approach is based on continuous monitoring of the risk assumed and the financial resources necessary to manage our various units, in order to optimize the risk-reward relationship in the development and implementation of the business plans of our various units in their ordinary management. Accounts receivable are typically unsecured and are derived from revenue earned from clients primarily in Latin America and EMEA. Additionally, we carry out significant transactions with Telefónica Group. At June 30, 2014, accounts receivable due from Telefónica Group were $282.6 million ($302.2 million as of December 31, 2013).
Credit risk arising from cash and cash equivalents is managed by placing cash surpluses in high quality and highly liquid money-market assets. These placements are regulated by a master agreement revised annually on the basis of conditions prevailing in the markets and the countries where we operate. The master agreement establishes: (i) the maximum amounts to be invested per counterparty, based on their ratings (long- and short-term debt rating); (ii) the maximum period of the investment; and (iii) the instruments in which the surpluses may be invested.
Liquidity Risk
We seek to match our debt maturity schedule to our capacity to generate cash flows to meet the payments falling due, factoring in a degree of cushion. In practice, this has meant that our average debt maturity must be longer than the length of time we require to generate cash flows to pay our debt (assuming that internal projections are met).
At December 31, 2013, the average term to maturity of our debt with third parties, which totaled $851.2 million, was 6.1 years. In addition, we had current assets of $770.8 million at such date, which includes cash and cash equivalents of $213.5 million, of which $13.7 million is located in Argentina and subject to restrictions on our ability to transfer them out of the country.
As of June 30, 2014, the average term to maturity of our debt with third parties ($745.3 million) was 5.1 years. In addition, we had current assets of $787.1 million at such date, which includes short term financial investments of $59.5 million and cash and cash equivalents of $178.2 million, of which $6.9 million are located in Argentina and subject to restrictions on our ability to transfer them out of the country.
Capital Management
Our capital management goal is to determine the financial resources necessary to continue our recurring activities and maintain a capital structure that optimizes own and borrowed funds. Additionally, we set an optimal debt level in order to maintain a flexible and comfortable medium-term borrowing structure in order to carry out our routine activities under normal conditions and to address new opportunities for growth. We strive to maintain debt levels in line with forecasted future cash flows and with quantitative restrictions imposed under financing contracts.
In addition to these general guidelines, we take into account other considerations and specifics when determining our financial structure, such as country risk, tax efficiency and volatility in cash flow generation.
At the date of this prospectus, we are compliant with and other established in our financing contracts. In order to monitor our compliance with our financing contracts, we regularly monitor figures for net financial debt with third parties and EBITDA.
 
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 BUSINESS
Our Company
We are the largest provider of CRM BPO services in Latin America and Spain, and among the top three providers globally, based on revenues. Our business was founded in 1999 as the CRM BPO provider to the Telefónica Group. Since then, we have significantly diversified our client base, and subsequent to the Acquisition in December 2012, we became an independent company.
Leadership Position in Latin America . As the largest provider of CRM BPO services in Latin America, we hold #1 market share positions in most of the countries where we operate, based on revenues for the year ended December 31, 2013, according to Frost & Sullivan. From 2009 to 2012, we expanded our CRM BPO market leadership position in Latin America overall from 19.1% to 20.1% and increased our market share in Brazil from 23.3% in 2009 to 25.5% in 2013, based on revenue. We have achieved our leadership position over our 15-year history through our dedicated focus on superior client service, our scaled and reliable technology and operational platform, a deep understanding of our clients’ diverse local needs and our highly engaged employee base. Given its growth outlook, Latin America is one of the most attractive CRM BPO markets globally and we believe we are distinctly positioned as one of the few scale operators in the region.
Full Scale CRM BPO Services Offering . We offer a comprehensive portfolio of CRM BPO services, including customer service, sales, credit management, technical support, service desk and back office services. We are evolving from offering individual CRM BPO services to combining multiple service offerings, covering both the front-end and the back-end of our clients’ customer experience, into customized solutions adapted to our clients’ needs. We believe that these customized customer solutions provide an improved experience for our clients’ customers and create stronger customer relationships, which reinforces our clients’ brand recognition and enhances customer loyalty. Our services and solutions are delivered across multiple channels including digital (SMS, email, chats, social media and apps, among others) and voice, and are enabled by process design, technology and intelligence functions. In 2013, CRM BPO solutions and individual services comprised approximately 23% and 77% of our revenues, respectively. In Brazil, the CRM BPO solutions segment grew from 16% of our revenue in 2011 to 35% of our revenue in 2013.
Our CRM BPO services and solutions are delivered through our innovative multi-channel platform. As our clients’ customers become more connected and widely broadcast their experiences across a variety of digital channels, we believe the quality of their customer experience is having a significant impact on our clients’ brand loyalty and overall business performance. Our multi-channel platform integrates direct customer outreach through digital, voice or in-person channels allowing us to engage with customers through multiple channels of interaction. As our clients’ customers increasingly transition towards digital communication, we have evolved and invested in our digital channel capabilities.
Our customized CRM BPO solutions further integrate us into the strategic objectives of our clients, often leading to closer, more resilient client relationships. For example, for a global insurance client, we provide a comprehensive solution for insurance claims management encompassing (i) specialized processes including back office, sales, customer care, credit management and technical support, (ii) a customized communication channel strategy throughout the customer’s lifecycle, (iii) workload, mobility software and communication tools and (iv) data and analytics, resulting in 25,000 monthly claims analyzed and approximately $8 million of annual savings.
 
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Long-Standing Client Relationships Across a Variety of Industries . We work with market leaders in sectors such as telecommunications, financial services and multi-sector, which for us comprises the consumer goods, services, public administration, pay TV, healthcare, transportation, technology and media industries. In 2013, approximately 52% of our revenue was derived from sales to telecommunications, 35% to financial services and 13% to multi-sector clients. Since our founding in 1999, we have significantly diversified the sectors we serve and our client base to over 400 separate clients resulting in non-Telefónica revenue accounting for 51.5% in 2013 compared to approximately 10% of the revenue of AIT Group in 1999. In 2013, 69% of our non-Telefónica revenue was generated from clients with whom we have had relationships for ten or more years. Illustrative of our high customer satisfaction, in 2011, 2012 and 2013, our client retention rates (calculated based on prior year revenue of clients retained in current year, as a percentage of total prior year revenues) were 97.9%, 98.5% and 99.3%, respectively.
Highly Engaged Employees . Our approximately 153,000 employees worldwide are critical to our ability to deliver best-in-class customer service. We believe our distinctive culture and strong values ensure that our employees are highly engaged customer specialists. We strategically implement collaborative and proprietary training processes and firm-wide methodologies to recruit, train and retain one of the largest workforces in Latin America. We strive to attract, develop and reward high-performing people and to provide our employees with an attractive career path that incentivizes them to engage in achieving or exceeding our clients’ business objectives. In 2013, we were named one of the top 25 multinationals globally to work for by the Great Place to Work Institute and the only CRM BPO company in the industry to receive this distinction.
Employee benefit expenses are our single largest cost item representing $1,701.9 million (70.4% of revenues), $1,609.5 million (69.5% of revenues) and $1,643.5 million (70.2% of revenues) in 2011, 2012 and 2013, respectively. We operate in geographies with high wage inflation as in Brazil where average wage inflation based on data published by the Economist Intelligence Unit for 2012 and 2013 was 10.6% and 8.6% in 2012 and 2013, respectively. We were able to maintain employee benefit expenses stable as a percentage of revenues between 2011 and 2013 principally through the following measures: (i) price increases as most of our contracts contain provisions that allow us to pass on to our customers increased costs that result from inflation adjustments, (ii) cost efficiencies related to enhanced productivity, investment in our IT platform and procurement process as well as HR improvements (see “—Our Strategy—Best in Class Operations”), (iii) delivering increasingly complex solutions and value-added services to our clients positively affecting margins (see “—Our Strategy—Develop and Deliver CRM BPO Solutions”) and (iv) minimizing wage inflation through collective bargaining agreements.
Scalable and Reliable Technology and Operational Platform . We have a flexible, scalable and reliable technology platform that enables us to deliver customizable services and solutions for our clients. The three key
 
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components of our technology strategy are (i) scalable and secure infrastructure, which includes data centers, telephony and other systems to support and automate our services, (ii) applications, including systems, analytics and intelligence tools that enhance and optimize our solution offerings and (iii) our technology organization, which consists of the people and resources to manage and innovate our platform. In 2013, our technology platform handled transactions across 89 delivery centers operating 24/7 with less than 0.06% unscheduled systems downtime. We are committed to the highest standards of quality and have implemented programs to certify relevant processes as UNE-ISO 9001 and COPC, and we use Six Sigma to ensure continuous improvement.
Strong Relationship with Telefónica Underpinned by Long-Term MSA . We believe we contribute to the Telefónica Group as an integral part of its CRM BPO operations. Currently, we serve 38 companies of the Telefónica Group under 162 arm’s-length contracts. Since becoming an independent company in December 2012, our relationship with the Telefónica Group has been governed by our MSA. The MSA requires the Telefónica Group companies to meet pre-agreed minimum annual revenue commitments to us through 2021. The MSA commitment is meant to be a minimum commitment, rather than a target or budget. Telefónica will be required to compensate us for any shortfalls in these revenue commitments. The MSA expires on December 31, 2021, and although the MSA is an umbrella agreement which governs our services agreements with the Telefónica Group companies, the termination of the MSA on December 31, 2021 does not automatically result in a termination of any of the local services agreements in force after that date.
Our revenue generated from the Telefónica Group was $1,235.9 million in 2011, $1,158.5 million in 2012 and $1,136.5 million in 2013, reflecting a decrease of 6.3% and 1.9% for the years ended December 31, 2012 and 2013, respectively. Excluding the impact of foreign exchange, our revenue from the Telefónica Group for the years ended December 31, 2012 and 2013 increased by 3.8% and 4.7%, respectively.
Outside the ordinary course of our business and in connection with the Acquisition, we have incurred obligations to Telefónica in an aggregate amount outstanding of $67.8 million as of June 30, 2014 and $195.1 million as of December 31, 2013. For a more detailed description of such obligations, see “Description of Certain Indebtedness—Vendor Loan Note” and “Description of Certain Indebtedness—Contingent Value Instruments.”
Broad Scope of Operations . We operate in 15 countries worldwide and organize our business into the following three geographic markets: (i) Brazil, (ii) Americas, ex-Brazil (“Americas”) and (iii) EMEA. For the year ended December 31, 2013, Brazil accounted for 51.5% of our revenue and 52.6% of our Adjusted EBITDA; Americas accounted for 33.0% of our revenue and 38.7% of our Adjusted EBITDA; EMEA accounted for 15.5% of our revenue and 8.7% of our Adjusted EBITDA (in each case, before holding company level revenue and expenses and consolidation adjustments).
Financial Flexibility . We have ample liquidity which provides significant financial flexibility to manage our operations. At December 31, 2013, the total amount of credit available to us was €50 million ($69 million) under our Revolving Credit Facility, which remained undrawn as of June 30, 2014. In addition, we had cash and cash equivalents (net of any outstanding bank overdrafts) and short-term financial investments of approximately $237.7 million as of June 30, 2014, while our outstanding debt totaled $1,366.0 million. The amount of outstanding debt attributable to the Acquisition in 2012 totaled $1,358.3 million. We expect to capitalize the full $620.7 million of PECs outstanding as of June 30, 2014 in connection with this offering thereby reducing our total debt outstanding. See “Capitalization.” During 2013 and for the six months ended June 30, 2014, our cash flow related to interest payment and mandatory debt repayment represented 38.9% and 42.3%, respectively, of our cash flows from operating activities (before giving effect to the payment of interest). For a more detailed description of such obligations, see “Description of Certain Indebtedness.”
Our revenue for the year ended December 31, 2013 was $2,341.1 million, our Adjusted EBITDA was $295.1 million and our profit/(loss) for the period was a loss of $4.0 million. For the year ended December 31, 2012 and 2013, our revenue decreased by 4.2% and increased by 1.0%, respectively, and our Adjusted EBITDA increased by 8.6% and 10.1%, respectively. For the years ended December 31, 2012 and 2013, respectively,
 
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excluding the impact of foreign exchange, our revenue increased by 6.7% and 7.5%, and our Adjusted EBITDA increased by 21.5% and 16.9%.
Our revenue for the six months ended June 30, 2014 was $1,153.6 million, our Adjusted EBITDA was $131.6 million and our profit/(loss) for the period was a loss of $24.3 million. For the six months ended June 30, 2014 compared to the same period in 2013, our revenue decreased by 1.2% and our Adjusted EBITDA increased by 6.2%. Excluding the impact of foreign exchange, our revenue increased by 9.5% and our Adjusted EBITDA increased by 16.1% in the six months ended June 30, 2014 compared to the same period in 2013.
Market Opportunity
CRM BPO has historically been the largest segment within the broader BPO market based on revenue, and includes services such as customer care, retention, acquisition, technical support, help desk services, credit management, sales, marketing and back-office functions.
Market Size and Growth . According to IDC, global spending on CRM BPO services is expected to grow at a CAGR of 5.9% from $60.9 billion in 2013 to $81.3 billion in 2018. Our operations are primarily focused in Latin America, which is the fastest growing CRM BPO market in the world with a market size of $10.3 billion in 2013, according to Frost & Sullivan.
Key Trends in the Latin American CRM BPO Market
There are a number of trends driving growth in the Latin American CRM BPO market and we believe our market position will allow us to differentiate ourselves and capitalize on this growth.
Large CRM BPO Market with Sustained Demand Growth Driven by an Emerging Middle Class. The scale and growth of Latin America’s economies present a significant market opportunity. The growth in the CRM BPO market is supported by an expanding middle class, which is expected to grow from approximately 29% of the population in 2009 to approximately 42% by 2030, according to data from The World Bank. As a result, customer experience-intensive industries, such as insurance and banking, which have historically been underpenetrated in Latin America, have experienced high volume growth, resulting in increased demand for CRM BPO services. Lastly, according to Frost & Sullivan, in 2013, call center seat penetration in Latin America significantly lagged the United States, and we believe that this gap will continue to drive long-term growth for our industry in the region.
2013 Call center seats / ‘000s population

 

Source:	Frost & Sullivan and International Monetary Fund.	
Note:	Includes in-house and outsourced seats.	
Continued Trend for Further Outsourcing of CRM BPO Operations. As of 2013, 32.4% of domestic CRM BPO operations in Latin America were outsourced to third-party providers, based on number of agent seats, compared to 27.1% in 2007, according to Frost & Sullivan. In the context of high growth in CRM BPO volumes, we believe the value proposition for further outsourcing is compelling and enables our clients to (i) focus on their
 
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core capabilities, (ii) generate cost efficiencies, (iii) increase customer satisfaction, (iv) streamline the process of introducing new products and services and (v) redeploy capital used in internal processes. Given these factors, we expect outsourcing penetration in our markets to continue to grow in the future.
Limited Number of Large Scale Operators in Latin America. Very few companies operate large-scale operations throughout Latin America. Most companies operate in only one or two Latin American countries, or within multiple markets with more limited scale as compared to Atento. Establishing large scale operations in Latin America presents challenges due to specific country dynamics in the region and the complexity of managing a large and dynamic workforce. These markets are also characterized by the presence of local players with established long-term positions. For example, in Brazil, the top three providers of CRM BPO services in aggregate accounted for 59.2% of the market in 2013, whereas in North America the top three providers in aggregate had just a 16.2% share in 2012, according to Frost & Sullivan.
North America’s Continued Off-Shoring Trend. We view North America as a growth opportunity as U.S.-based businesses continue to off-shore call center services to other geographies, with 37.4% of the market off-shored in 2012, and 43.4% expected to be off-shored by 2017, according to Frost & Sullivan. Among off-shoring options, U.S. clients increasingly choose to near-shore to Latin America to eliminate challenging time zone differences that might be experienced when off-shoring to jurisdictions such as India or the Philippines. Accordingly, Latin America has evolved into the fastest growing fulfillment market for providing CRM BPO services to North America, and expected to grow at a CAGR of 10.5% from 2012 to 2017, according to Frost & Sullivan.
Our Strategy
Our mission is to help make our clients successful by delivering the best experience for their customers. Our goal is to significantly outperform the expected market growth by being our clients’ partner of choice for customer experience solutions. We strive to deliver growth by leveraging our platform and our people as the key enablers of superior services and solutions for our clients. To this end, we are focused on optimizing our operations and inspiring our people to deliver excellent service to our clients, and our clients’ customers.
These are the pillars of our strategy and the specific initiatives by which we aim to achieve them:

Above-Market Growth
Our three main initiatives to generate higher growth than the overall market are:
Deliver CRM BPO Solutions . By further leveraging our existing infrastructure and deep client and process know-how, we are able to deliver increasingly complex solutions and value-added services to our clients through
 
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multiple channels. Over time, we have diversified and expanded our services, increased their sophistication and complexity and developed customized solutions such as smart collections, B2B (business-to-business) efficient sales, insurance management, credit management and other CRM BPO processes. Our revenue from these solutions has grown faster than our overall revenue over the past several years.
As of June 30, 2014, we served a large and diverse base of over 400 separate clients. We believe we can further penetrate these existing relationships by increasing the variety of solutions we provide. We have successfully expanded our service and solution offerings in the past and believe this is a continued growth opportunity, as we are one of the few providers that can deliver an integrated and broad set of CRM BPO solutions to a large and increasingly sophisticated client base.
Aggressively Grow Client Base . We believe we can win new client relationships, either from competitors or as potential clients outsource their in-house operations. In particular, the telecommunications sector, where we have deep industry knowledge primarily derived from our long-history with Telefónica, presents an opportunity to further increase our market share now that we are a stand-alone company. Today, we provide solutions to most of the telecommunications companies in Brazil and have acquired other telecommunications clients throughout the Americas, such as Claro (a subsidiary of América Móvil). Going forward, we are focused on growing these new relationships to scale.
To reinforce this strategic priority, we have significantly invested in our sales teams and established separate new business acquisition areas with enhanced commercial capabilities and tools.
Penetrate U.S. Near-Shore. The market for providing outsourcing services to U.S. clients from Latin America is a sizable and fast-growing opportunity as (i) companies in the United States seek to balance outsourcing services across different geographies, generally favoring locations with better cultural fit and proximity to their operations, while minimizing time zone differences (in particular compared to jurisdictions such as India and the Philippines), (ii) Latin America becomes a more cost-competitive location and (iii) the talent pool in the region grows, with more people who have strong English-language skills.
To pursue this opportunity, in 2013, we formed a dedicated business unit with its own infrastructure to exclusively serve the U.S. market which, as of April 2014, has more than 450 workstations servicing five clients including Motorola, BBVA Group and Orbitz. We believe our strong relationships with multi-national clients throughout Latin America positions us well to also serve their off-shoring needs in the United States as exemplified by our near-shoring relationships with Motorola and BBVA Group.
Best-In-Class Operations
We have made significant investments in infrastructure, proprietary technologies, management and development processes that capitalize on our extensive experience managing large and globalized operations. Our operational excellence strategy is supported by the following five key global initiatives:
Enhance Operations Productivity. We are focused on a variety of initiatives to enhance agent productivity, including:
 
 	•	 	improving the uniformity of KPIs for operational productivity;	
 
 	•	 	using statistical analysis and enhanced forecasting methodology to optimize staffing level; and	
 
 	•	 	establishing Operational Command Centers to implement analytical tools and standardized performance metrics.	
We have established an Operational Command Center in Sao Paulo, Brazil which is designed to streamline the efficiency of our operations across our delivery centers and optimize corporate functionality and management effectiveness via a standardized set of enhanced processes and capabilities. This center is equipped with the technology available for our purposes and serves to enhance our ability to shift resources as needed, in real-time,
 
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based on client requirements. Additionally, it provides our management immediate analytics and continuous data enabling them to streamline processes that we expect will offer the optimal customer experience for our clients.
Increase HR Effectiveness . Our business model is focused on improving operations HR effectiveness, developing our people and reducing turnover, driving both performance and reduction in costs. Recruiting, selecting and training talent is a key factor in the successful delivery of our CRM BPO services and solutions. We have adopted a comprehensive approach to HR management, with a number of global initiatives under way that are designed to diversify our candidate sourcing (e.g. social media), refine agent selection methods focused on better fit to reduce early turnover, and improve training to develop the best talent. We are also continually aligning HR processes and incentive plans to foster employee retention.
Deploy One Procurement . We are strengthening our centralized procurement model in order to lower costs and streamline supplier relationships. Our “Global Deal Delivered Locally” strategy allows us to work with vendors to reach global contracts, while allowing procurement decisions to be handled locally. For example, by sourcing agent headsets as part of a global contract, we were able to achieve significant savings across all of our geographies, ranging from 5% to 82% of net unit headset costs. We are continuing to deploy this procurement strategy across our business, including in our procurement of infrastructure, technology, telecommunications and professional services, to reduce operating costs and improve margins.
Drive Consistent and Efficient IT Platform . Our technology strategy is focused on (i) delivering a cost-efficient and reliable IT infrastructure to meet the needs of existing clients and support margin expansion, (ii) enhancing our ability to add capacity rapidly with a highly variable cost structure for new business, (iii) developing new products and solutions that can be rapidly scaled and rolled out across geographies, (iv) providing standard operational tools and processes to enable the best experience to our clients’ customers, and (v) establishing common platforms that facilitate centralization of core IT services. Technology initiatives to capture benefits of scale, standardization, and consolidation are managed globally, with full accountability by project leaders to continuously optimize our operations and innovate client solutions.
Optimize Site Footprint . We continue to relocate a portion of our delivery centers from tier 1 to tier 2 cities, as we seek to optimize lease expenses and reduce employee benefit expenses by focusing on reducing turnover and absenteeism. Additionally, the relocation of delivery centers allows us to access and attract new and larger pools of talent in locations where Atento is considered a reference employer. We have completed several successful site transfers in Brazil. In Brazil, the percentage of total workstations located in tier 2 cities increased from 44% in 2011 to 54% in 2013. Currently, we are planning to move more than 1,700 workstations in Brazil to tier 2 cities by the end of 2014. As demand for our services and solutions grows and their complexity continues to increase, we continue to evaluate and adjust our site footprint to create the most competitive combination of quality of service and cost effectiveness.
In addition, given the size of our workforce, our operational excellence strategy is targeted at supporting the future growth of our business and delivering efficiency gains while mitigating costs in particular wage inflation in the markets where we operate.
Inspiring People
Distinct Culture and Values . We believe that our people are a key enabler to our business model and a strategic pillar to our competitive advantage. We have created, and constantly reinforce, a culture we believe is unique in the industry. We believe our distinctive culture and strong values ensure our employees are highly capable and committed customer specialists. Our operational policies encourage collaboration and entrepreneurship, emphasize trust, passion and integrity, and commitment to our clients. We believe we can deliver growth and outstanding customer experiences through inspired, committed people who share our vision and are guided by our values. We constantly reinforce our core values through working groups, surveys, and
 
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leadership assessment processes that focus on upholding our core values and result in individualized development plans.
Strengthen Talent . We have developed processes to identify talent (both internally and externally), created individualized development plans and designed incentive plans that foster a work environment that aligns our management’s professional development with client objectives and our goals, including efficiency objectives, financial targets and client and employee satisfaction metrics. Furthermore, we continuously reassess our talent pool and recruit experienced professionals in the services industry to complement our strengths and capabilities. Given our focus on developing our people, we believe we empower our teams and provide opportunities and tools to act like owners, committed to delivering excellence and achieving superior performance.
High Performance Organization . We have implemented a new operating model that integrates the corporate organization globally, allowing us to capture the benefits of scale, standardization and sharing of best practices. The corporate organization is integrated globally but strategically segmented into different operating regions. This ensures that corporate functions remain close to their businesses and clients, utilize a deeper understanding of the local industry levers, and are committed to the successful implementation of the initiatives on a regional level. We believe that this new organizational structure will foster agility and simplicity, while ensuring that corporate leaders are focused on coordinating, communicating and pursuing new solutions and innovation, with full accountability on the results.
Our Competitive Strengths
We benefit from the following key competitive strengths in our business:
Category Leader in a Large Market with Long-Term Secular Growth Trends
We are currently the leading provider of CRM BPO services and solutions in Latin America and among the top three providers globally, based on revenue, according to Frost & Sullivan. In 2012, we were the leading provider of outsourced CRM BPO services in the rapidly growing Latin American market overall with a 20.1% market share by revenue, compared to 19.1% in 2009. In addition, we were the leading provider of outsourced CRM BPO services by market share based on revenue in 2013 in Peru, Brazil, Argentina, Spain, Chile and Mexico according to data published by Frost & Sullivan (except for Spain, which refers to market share data for 2011, and Brazil which represents management’s estimate as of Q1 2014).
Atento 2013 Market Share and Position by Country

 

Source:	Frost & Sullivan.	
(1)	Brazil market share based on Frost & Sullivan, market share position as of Q1 2014 (management estimate).	
(2)	Spain market share as of 2011.	
 
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According to Frost & Sullivan, we have increased our market share of the CRM BPO market in Brazil from 23.3% in 2009 to 25.5% in 2013, second only to Contax Participações, S.A., whose market share declined from 29.8% to 27.3% in Brazil over the same period. We generated BRL693.0 million ($306.7 million) and BRL681.3 million ($288.9 million) of revenues in Brazil in the fourth quarter of 2013 and first quarter of 2014 respectively while Contax reported revenues for its contact center division in Brazil of BRL683.9 million ($300.5 million) and BRL636.5 million ($273.6 million), respectively, in those periods. Based on this data we believe we are now the leading CRM BPO provider in Brazil.
Comprehensive, Customizable Suite of CRM BPO Solutions across Multiple Channels
We believe that our position as a provider of innovative CRM BPO solutions is a key factor for our gain in market share in recent years, and will be a driver of our expected outperformance. As we continue to evolve towards customized client solutions and variable pricing structures, we seek to create a mutually beneficial partnership that increases the portion of CRM BPO services we provide to our clients. We intend to develop and expand our portfolio of customized solutions as we continue to leverage our deep knowledge of our clients’ outsourcing needs.
In the context of the continuing evolution and proliferation of digital communication technologies and devices, we are focused on and continue to invest in research and development to anticipate the changing habits of customers and how our clients ultimately engage with them across a growing array of communication channels including SMS, email, chats, social media and apps, among others.
Long-Standing, Blue-Chip Client Relationships in Multiple Industries
Our long-standing, blue-chip client base across a variety of industries includes Telefónica Group, BBVA Group, Banco Bradesco S.A., Carrefour, Claro, Elavon, HSBC, Itaú, L’Oreal, McDonald’s, Motorola, Santander, Samsung and Zurich, among others, with Telefónica Group representing 48.5% of our revenue for 2013 and the other clients representing, individually, less than 10% of our revenue for 2013. Including Telefónica, our top 10 clients represented 80.3% of our 2013 revenues. For each of these clients, our relationship usually encompasses multiple contracts, services and countries. Our clients include leaders and innovators in their respective industries who demand best-in-class service from their outsourcing partners. By aligning ourselves with their success to partner in the long term, we have expanded the scope of our services and solutions while helping our clients deliver their brand promise. We believe that this approach has allowed us to develop and nurture longstanding relationships with existing clients which have provided us with stable revenue year-to-year.
Additionally, we believe it is costly and presents risks for our clients to switch a large number of workstations to competitors due to the potential disruption caused to the client’s customers, the extensive employee training required and the level of process integration between the client and CRM BPO provider.
Value-Added Partner with Differentiated Technology Platform
We have a scalable and reliable technology platform that we believe is a significant competitive differentiator. Our technology platform allows us to be a value-added partner to our clients by providing upfront customer engagement process design, hosting and managing numerous customer management environments, offering multi-channel communication delivery and sophisticated data and analytics, which provide deep insight into each interaction with a client’s customer.
Focus on HR Management to Deliver Superior Customer Experiences
We believe employee satisfaction is a key differentiator in maintaining and growing a high performance organization to deliver a superior customer experience compared to our competitors and clients’ in-house operations. We leverage our distinctive culture and values as well as our deep understanding of regional cultural intricacies to create a work environment that aligns client objectives with employee incentives and commitment.
 
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We believe well-trained, highly-committed customer specialists, who are rewarded for results, enhance performance in our clients’ CRM operations. In 2013, we were named one of the top 25 companies to work for according to Great Place to Work Institute’s ranking of the World’s Best Multinational Workplaces, putting us alongside companies such as Google, Microsoft and The Coca-Cola Company in terms of employee satisfaction. Furthermore, as of September 3, 2014, we have received the most country-level Great Place to Work prizes in the CRM BPO industry.
Highly Experienced and Motivated Management Team
We benefit from the significant experience and knowledge of our management team. We inherited experienced, motivated local talent, with many members of our senior management having played an instrumental role in growing and establishing us as a global leader in the years prior to the Acquisition. Most of our operational managers have worked with us for over ten years, which has allowed us to accumulate valuable operational experience and deep vertical expertise, while building and maintaining close relationships with our key clients. As part of our transition to a standalone company, we complemented our management team with a new Chief Financial Officer, Chief Technology Officer, Chief Commercial Officer and Chief Procurement Officer to build a truly world class management team. This team is fully committed to building upon our market leadership and driving our transformational growth.
Our Integrated Solutions and Client Value Proposition
We work closely with our clients to optimize the front- and back-end customer experience for their users by offering solutions through a multi-channel delivery platform, tailored to each client’s needs. We have a comprehensive portfolio of scalable solutions such as smart collections, insurance management, smart credit solutions and advanced technical support solutions that incorporates multiple services such as customer care and sales, all deliverable across multiple communication channels including digital, voice and in-person. The flexibility of our solutions, comprised of a combination of services, channels, automation and/or intelligent analytics allows us to deliver a superior, value-added customer experience.
Our vertical industry expertise in telecommunications, financial services and multi-sector companies allows us to adapt our services and solutions for our clients, further embedding us into their value chain while delivering impactful business results. As we continue to evolve towards customized client solutions and variable pricing structures, we seek to create a mutually beneficial partnership and increase the portion of our client’s CRM BPO services that are provided by us.
For example, for a financial institution in Mexico, we operate the full credit card management process, from receipt of an application to the issuance of the credit card using a multi-channel platform. For this client, we processed over 600,000 credit card applications in the last 12 months ended August 31, 2014 and reduced the average processing time by 88%.
Our position as a provider of vertical, value-added CRM BPO solutions is a key factor for our share gain in recent years, and we believe will be a continued driver of our growth strategy going forward.
 
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Illustrative Examples of Our Solutions

 
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Our value proposition has continued to evolve toward end-to-end CRM BPO solutions, incorporating processes, technology and analytics as enablers for our services, all aimed at improving our clients’ efficiency and reducing costs. In 2013, CRM BPO solutions and individual services comprised approximately 23% and 77% of group revenues, respectively. For our clients in Brazil, our largest market, approximately 65% of our revenue was contributed by individual services and approximately 35% from solutions, for the year ended December 31, 2013. This represents significant growth for the Brazilian CRM BPO services segment which accounted for 16% of Brazilian revenue in 2011.
In 2013, approximately 70% of our revenues came from sales and customer service, while credit management, technical support and back office increased as a percent of revenue compared to 2012.
2013 Revenue Split by Service

 

(1)	Other BPO includes 0.1% of Service Desk.	
Levers for Continued Evolution toward Full Scale CRM BPO Services
To further grow our portfolio of comprehensive CRM BPO services, we are developing two Centers of Excellence, located in Brazil and Mexico, in order to identify and develop new solutions to address clients’ requests and convert our insights into innovative state-of-the-art solutions. This allows us to standardize existing solutions to support marketing to new clients in a scalable manner. To maximize the penetration of these solutions within our client portfolio, we utilize our consultative sales model to adapt the solution to specific client needs.
CRM BPO Services
We classify our CRM BPO services in six main categories:
Customer Service . This service is the main interface between our clients and their users. This service category is about our clients’ customers and relationship management, representing the most important source of information about customers’ perceptions and experience, aimed at fostering long-term relationships between our clients and their customers. We provide information about our clients and their products and services to their customers and handle inbound and outbound contacts relating to suggestions, requests and claims about products, services and processes, covering the entire customer life cycle.
 
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Sales . We support our clients in marketing their products by inbound and outbound contact with potential customers to sell our clients’ products and services in both the business to consumer (“B2C”) and the business to business (“B2B”) markets. We seek to be involved in all phases of the sales process. We have the ability to handle large volumes of potential customers, using multi-channel alternatives such as face-to-face contact, SMS, chat, voice and email.
Credit Management . We work along the entire credit risk and risk management value chain, from credit analysis and approval to advanced collections through voice and digital communication channels. We provide collection management services, seeking to increase our clients’ revenue and to retain customers so that they can continue to generate revenue for our clients. Credit management services also include business intelligence in the form of profile analysis of defaulting customers, in order to create an effective collection strategy, incorporating the appropriate technology. As part of our services we do not assume any credit risk on behalf of our clients.
Technical Support . We create specialized teams that are available to companies and institutions to provide information, assistance and technical guidance to their customers on a specific product or service. Technical support includes the installation and maintenance of net servers, telecommunications, broadband connections, software and other applications. The single point of contact (“SPOC”) model allows our teams to handle large numbers of incidents at an early stage, using different channels, including telephone, email and chat, reducing costs for our clients. We extend these services to a large and diverse number of business areas.
Back Office . Our back office services are internal, administrative operations that support central processes and are not generally visible to the public. This service includes activities such as document manipulation, digitization, archiving, workflow process, among others, and helps our clients to reduce costs and increase productivity. This product component is supported by automation tools to process routine and repetitive activities enabling us to manage information and work with a high volume of business processes. In addition, these tools allow our employees with high autonomy at the operational level and are also designed to comprise part of our vertical solutions (e.g., car financing or insurance).
Service Desk . We act as a SPOC for clients by managing and solving incidents and requests of our clients’ employees and suppliers through a multi-channel service desk. This service supports IT issues and also human resources, maintenance, procurement and other internal issues. The aim of the SPOC model is to solve problems on the first call or dispatch the call to specialized departments.
Other BPO Processes . Other BPO processes include services which do not fit within our existing six product classifications. In general, these services are provided to our clients as standalone solutions and are comprised of training activities, workstation infrastructure, interactive voice response (“IVR”) port implementation, telecommunications infrastructure, application development and others.
Communication Channels
Our CRM BPO solutions are delivered through our innovative, multi-channel platform. Our multi-channel approach integrates direct customer outreach through digital, voice or in person channels allowing us to engage with the customer through multiple channels of interaction. As our clients’ customers increasingly transition toward digital communication, we have evolved and invested in our digital channel capabilities. Our digital channel capabilities include: email, SMS, chats, social networks, apps and video chat. Although traditional voice channels still account for a majority of our revenues, digital channels are increasing in relative importance.
Each of our channels is available simultaneously and integrated with our other services, so customers using different forms of communication can be treated similarly and in an efficient manner. This multi-channel approach can be used in combination with any service or solution in our portfolio.
 
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Industry Recognition and Awards
We strive to find solutions that enhance the experience of our clients’ customers and to differentiate ourselves from our competitors through innovation and a better customer experience and our achievements have been widely recognized by the industry in each of their local operations. Over the years, the quality and innovation of our solutions and services have been consistently awarded with the most prestigious recognitions within the CRM BPO industry, including the Amauta awards (Direct and Interactive Marketing awards of reference in Latin America granted by ALMADI, Direct Marketing Association of Latin America), the Premio Latam (granted by Aloic, the Latin America Alliance of CRM organizations), the AMDIA awards (granted by the Association of Direct and Interactive Marketing of Argentina), the CRC de Oro (highly prestigious awards in Spain granted by a consortium of CRM industry associations and think tanks encompassing the AEERC, the IZO and the IFAES) and the Iberoamerican Quality Award.
Client Case Studies
Longstanding, Strong Relationship as the CRM BPO Provider to the Telefónica Group
About the Relationship . We believe we contribute to the Telefónica Group as an integral part of its CRM BPO operations. While we have a client base of over 400 separate clients, we continue to maintain a strong and embedded relationship with Telefónica. Currently, we serve 38 companies within the Telefónica Group that are governed by 162 arm’s-length contracts.
Atento Provides New Product Post-sales Support for Telefónica Brand, Vivo, in Brazil
About the Client. Telefónica’s Brazilian customers know Telefónica as the brand Vivo. Vivo provides telecommunications services in more than 3,700 cities in Brazil serving over 92 million customers as of December 2013. Vivo sought an initiative to replace obsolete technologies in areas unreached by landline services with a new innovative GSM product. We are providing the support services for the initiative, including post-sales services that are fully compliant with the Brazilian National Telecommunications Agency (“ANATEL”).
Business Challenge. The product involves various operational characteristics such as portability terminal device availability, logistics, technical certification, etc. In addition, it must also comply with ANATEL Service Level Agreements (SLAs). The product is intended for existing Vivo customers to migrate to the new platform and to capture new customers in those remote regions. Compounding the challenge of the initiative, there are exceptional events that occur during the installation process in 70% of the new service requests, which require additional analysis and processes orchestration (e.g. exchange of appliances).
Atento Solution . Utilizing our cloud-based infrastructure, we were able to implement the complaint handling solution in 45 days (18 dedicated to customized planning and 27 to development). Features of the solution include automatic task distribution, prioritization rules and real-time performance management, implemented by our Social Business Process Management (“BPM”) solution to track and manage the operation. The Social BPM improves service support to Vivo’s new product in various stages of the post-sales service cycle. In a 24/7 operation, we handled up to 13,000 exceptional service requests, and up to 600 complaints and lawsuits per month in the Ombudsman Department.
Results . Vivo’s adoption of our complaint handling solution brought significant benefits in the first 6 months of operations: (i) 80% decrease in errors in analysis and event classification after Vivo switched from internal spreadsheets to our Social BPM solution, and (ii) improved compliance with SLAs. Further, complaints reported to ANATEL decreased by 67% and fell to 200 in the Ombudsman Department, optimizing the customer experience for Vivo’s customers. Finally, our structured operations and real-time data management allows Vivo to more easily track KPIs and continuously improve processes.
 
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Atento Reduces Lead Time and Errors in Auto Loan Processes for a Brazilian Financial Institution
About the Client. A major Brazilian financial institution operates in the auto loan industry through an extensive network of over 20,000 resellers and auto dealers around the country. Our client sought to improve their processes based on our high-quality back-office solutions.
Business Challenge. Auto loan processing faces the challenge of reducing delays and errors when managing large volumes of documents. To stand out among other players in the industry, our client sought our solutions to optimize processes, reduce lead times and deliver a higher-quality service to its customers.
Atento Solution . Relying on our back office operations expertise, we handled 200,000 annual processes related to auto loans. We are responsible for requesting all of the required documentation for auto loan processes. After receiving the documents, we scan and register them into an electronic management system to be analyzed and subsequently issue contracts. After transaction approval, contracts are signed by a legal representative of the client and sent to the State Transit Department and to Registry Offices. After returning to Atento, the documents for the vehicle are forwarded to the customer. Our multi-channel platform allows for all steps of the entire document analysis to be tracked through various channels such as email, SMS, chats and voice. Our back office service includes anti-fraud and information protection systems. Managerial and analytical reports ensure visibility over the progress throughout the process.
Results . In just one year, the client reported a 93% reduction in process errors compared to the comparable prior period. The lead time was 35% lower and the index of complaints decreased by 56%. In addition, the elimination of manual paper handling and process automation drove increased document analysis efficiency, without losing process security and precision. With daily reports, tactical and strategic decision making is faster. Furthermore, there is a stronger recognition of the services from the client’s partner network and increased customer satisfaction.

 
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Atento Helps Improve Brazilian Acquirer’s Sales
About the Client. One of the leading financial institutions in the Brazilian electronic payments market, our client is a merchant acquirer and payment processor working with 25 different brands of credit, debit and benefits cards. Our client sought an Atento solution to improve sales of terminal devices and financial services via more cost-efficient sales methodology.
Business Challenge. Our client sought to explore better business opportunities for its point of sale (“POS”) and POS wireless outdoor (“POO”) terminals, electronic funds transfer system and other financial services such as advance on receivables and financing. The goal for the client was to utilize Atento’s regional expertise and comprehensive credit card management solution to increase customer retention and increase sales.
Atento Solution . The Atento solutions team identified more than 15,000 commercial establishments in Brazil’s south-eastern and central-western regions as potential new customers of POS terminals and sought to cross-sell additional financial solutions to current accredited establishments. The contact information of the establishments is registered into a mobility tool used by our consultants, which helps manage the productivity of the consultants. Additionally, information is collected on each establishment that is interested in renting terminal devices and contracting services. Utilizing Atento’s back office solutions, indicators and reports are generated based on the information learned. As establishments are accredited or contracted for additional financial solutions, our specialists contact the merchants to encourage POS use, customized via information learned during the outreach process.
Results . Utilizing Atento’s solution, our client registered an increase of approximately 300% in sales within the first six months of the operation. Additionally, higher levels of productivity were reported as were increased levels of customer satisfaction, leading to stronger direct relationships with key-decision makers of the establishments. The combination of people, processes and technology provides a revenue-generating and cost-saving solution for our client.

Sales & Marketing
Since becoming a stand-alone company in 2012 we have been transitioning our business model from a customer care provider to a CRM BPO solutions partner and we have adapted our commercial strategy to accelerate that transition, in order to fully benefit from the growth trends in the industry. We have consolidated the evolution of key components of the commercial organization, which will align our sales and marketing focus with our strategic priorities to grow our client base, develop and deliver CRM BPO solutions for our clients, and penetrate the U.S. near-shore opportunity.
We have reinforced our sales teams and established separate new business acquisition areas. Additionally, we have strengthened our marketing capabilities ensuring that they adequately support our focus on winning new businesses. Lastly, we have created a dedicated sales team focused on specific carve-out areas to tap into the large and attractive in-house market segment.
We have also accelerated the development and delivery of CRM BPO solutions. In order to do so, we have stepped up our commercial capabilities of our sales teams, expanding and improving our consultative sales
 
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model. In addition, we are developing two Centers of Excellence, in Brazil and Mexico, focused on: (i) identifying and developing new solutions, (ii) delivering those solutions through all necessary bring to market materials and implementation plans, and (iii) ensuring an excellent customer experience through a continuous improvement model.
In 2013, we formed a dedicated business unit with its own infrastructure to exclusively serve the U.S. market, which already has more than 450 workstations servicing five clients. We seek to leverage our scale, technology infrastructure, process knowledge and best practices to meet the U.S. market quality requirements.
In order to capitalize on the identified opportunities we organized our sales and marketing strategy around three strategic alternatives and five main enablers:

Structure and Processes : Balanced, Standardized Commercial Structure . We balance a global and regional model in order to maximize the benefits of best practices sharing and proximity to client execution. Our global model is integrated to regional hubs, close to our clients, and focused on setting a business framework with clear guidance, but giving flexibility to respond to internal and external market needs. Strategic initiatives are managed globally across our organization, with full accountability by project leaders. Regions and countries are responsible for day-to-day execution. Our centralized teams focus on identifying and sharing best practices and solutions and developing a specific, standardized framework for our sales teams, as well as leading and coordinating strategic initiatives that capture benefits of scale, standardization and consolidation .
Capabilities : Tailored Commercial Approach . We strive to develop key capabilities to increase sales force effectiveness, align internal skills with client and market needs and facilitate the accomplishment of strategic objectives. Our commercial capabilities are based on account planning discipline and development of consultative sales capabilities, where we can offer clients a holistic approach to their needs, offering solutions to enhance their customers’ experience.
As part of our consultative sales approach, our sales team works to understand our clients’ needs, develop a solution and submit a proposal containing a customized and value-added outcome. This approach allows us to build strong commercial relationships with our clients as we dedicate our specialists, efforts and knowledge to the goal of providing our clients with what we believe is the ideal and appropriate solution for each issue.
 
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Additionally, we believe that this model is well-suited to Latin America, where clients often have limited experience on the use and knowledge of outsourcing solutions when compared to clients in more mature markets, and appreciate an advisor who can help with the planning and design of an effective integrated solution.
Consultative Sales Approach

Once we have established a commercial relationship with a client, we are often able to provide additional services, as the client understands and trusts our services, allowing us to cross-sell and upsell our solutions.
Effective and Advanced Commercial Tools . We are focused on the execution and monitoring of our performance, and we apply tools such as account planning, CRM, pipeline construction, commercial reports and annual commercial planning, in order to ensure that the commercial effort is following our strategic objectives. We also have an incentive model focused on results, the objective of which is to ensure that our most talented people are motivated and committed to meeting our key goals.
Value Proposition: Superior and Diversified Value-Added Solutions . We aim to develop and deliver customized CRM BPO solutions to our clients, creating a strategic partnership approach that encompasses our variable invoice model. We have over time proactively diversified and expanded our services, increasing the complexity of the solutions we offer to include collections, technical support, service desk, back office and other BPO processes. By leveraging our existing infrastructure and deep client knowledge, we strive to deliver increasingly complex solutions and value-added services to our clients through multiple channels.
Management Model : Accountability Based on KPI and Monitoring . In order to achieve the delivery of our strategic goals, we periodically evaluate and monitor the contribution and development of our sales team. We have well-defined KPIs and financial targets on a global and regional level, promoting full accountability across all layers of the organization. We assign direct responsibilities and goals for each of our target clients and segments, and involve our senior management in the dialogue with our key client accounts.
Contracts and Pricing Model
Our contracts are structured to allow the addition of new services or the modification of existing services to meet our clients’ evolving needs. Our service contracts incorporate general clauses and include annexes detailing the services to be provided (including price, level of service and technical specifications), which can be updated as necessary.
 
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On average our contract terms are approximately 3 years. In addition, most of the contracts also include clauses permitting us to increase prices annually according to the consumer price index of the country specified in the agreements or provide for the possibility of the parties agreeing to similar adjustments.
Over the years, our pricing model has been modified, in part, based on industry trends. We transitioned our pricing relationships with our clients from a predominantly fixed price model to a model with a variable price component where we have the incentive and opportunity to benefit from the successes we provide to our clients and are better able to capture efficiencies we generate.
Our Clients
Over the years, we have experienced steady growth in our client base, gaining new clients year-on-year, resulting in what we believe is a world-class roster of clients across industry sectors. Our long-standing, blue-chip client base spans across a variety of industries and includes names such as Telefónica Group, BBVA Group, Banco Bradesco S.A., Carrefour, Claro, Elavon, HSBC, Itaú, L’Oreal, McDonald’s, Motorola, Santander, Samsung and Zurich, among others. Our clients are leaders in their respective industries and demand best-in-class service from their outsourcing partners. We serve clients primarily in the telecommunications and financial services sectors, and in multi-sector including consumer goods, services, public administration, pay TV, healthcare, transportation, technology and media. For the year ended December 31, 2013, our revenue from sales to clients in telecommunications, financial services and multi-sector industries, corresponded to 52%, 35% and 13% of total revenue, respectively.
For the six months ended June 30, 2014, our top 15 client groups accounted for 81.4% of our revenue and, excluding the Telefónica Group companies, our next 15 client groups accounted for 35.1% of our revenue. In calculating these percentages, we treated each member of the same corporate group as one client. With each of these, we have worked closely over many years across multiple countries, building strong partnerships and commercial relationships with these clients.
Longstanding Client Relationships
We seek to create long-term relationships with our clients where we are viewed as an integral part of their business and not just as a service provider. Because we strive to have the ability to offer products and solutions that cover the entire client’s value chain, we believe the solutions we are providing offer a higher value to our clients, generally leading to a longer-term relationship which is beneficial to both parties. In 2013, 69% of our revenue from clients other than the Telefónica Group came from clients that had relationships with us for ten or more years. Illustrative of our high customer satisfaction, in 2011, 2012 and 2013, our client retention rates (calculated based on prior year revenue of clients retained in current year, as a percentage of total prior year revenues) were 97.9%, 98.5% and 99.3%, respectively.
Development of Client Base
As of June 30, 2014, our client base consisted of over 400 separate clients (treating each company that is a member of the same corporate group as a separate client). Since 1999, when Telefónica, our former parent company, and its subsidiaries contributed approximately 90% of the revenue of AIT Group, we believe that we have achieved a high diversification of our client base by sources of revenue. For the years ended December 31, 2011, 2012 and 2013, we generated 51.1%, 50.0% and 48.5%, respectively, of our revenue from Telefónica Group companies. For the six months ended June 30, 2014, we generated 46.7% of our revenue from Telefónica Group companies.
As of June 30, 2014, 38 companies within the Telefónica Group were party to 162 arm’s-length contracts with Atento. Our service agreements with Telefónica Group companies remained in effect following the consummation of the Acquisition. Additionally, we entered into the MSA, a new framework agreement that replaced our prior framework agreement with Telefónica and which is intended to govern our relationship with Telefónica through 2021.
 
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Telefónica Group Master Service Agreement
Our service agreements with Telefónica remained in effect following the consummation of the Acquisition, and we entered into the MSA, a new framework agreement that replaced the framework agreement with Telefónica that was in place prior to the Acquisition. The term of the MSA expires on December 31, 2021 and there is no express provision for extension thereof.
The MSA requires the Telefónica Group companies to meet pre-agreed minimum annual revenue commitments to us in each jurisdiction where we currently conduct business (other than Argentina). The MSA commitment is meant to be a minimum commitment, or floor, rather than a target or budget. If the Telefónica Group companies fail to meet country specific revenue commitments, which are measured on an annual basis, Telefónica S.A. will be required to compensate us in cash for any shortfalls. If the Telefónica Group companies fail to meet the annual aggregate minimum revenue commitments for all jurisdictions covered by the MSA, Telefónica, S.A. will be required to compensate us in available cleared funds. Any such compensation payments will be in amounts calculated as a percentage of the revenue shortfalls, ranging from 8% to 20% of the shortfall depending on the scope of such shortfall and the relevant calendar year. In May 2014, we and Telefónica amended the MSA to adjust the minimum revenue commitments in Spain and Morocco by an average of €46.0 million ($62.6 million, based on the May 31, 2014 month-end close foreign exchange rates) per year to reflect the lower level of activities in these geographies and a corresponding €25.4 million ($34.6 million, based on the May 31, 2014 month-end close foreign exchange rates) payment was made by Telefónica representing the discounted value of the reduction in minimum revenue commitments which was subsequently applied to repay the Vendor Loan Note. See “Description of Certain Indebtedness—Vendor Loan Note.”
The initial minimum revenue commitment under the MSA was based on 2012 estimated revenues and is thereafter adjusted on an annual basis using a pre-agreed formula that calculates, in certain cases, an adjusted inflation rate, which takes into account, among other factors, wage inflation and the consumer price index in other jurisdictions (subject to a cap of 12%). For most jurisdictions covered by the MSA, from 2016 onwards, the minimum revenue commitment continues to adjust based on inflation benchmarks, but is then reduced by a pre-determined percentage, resulting in the commitment leveling off. In respect of operations in certain jurisdictions, the pre-determined rate of reduction applies from 2013 onwards. For 2013, and based on the year-end exchange rate, the minimum revenue commitment under the MSA was approximately $1.0 billion. The contractual minimum revenue commitment under the MSA for periods thereafter cannot yet be calculated.
Under the terms of the MSA, Telefónica is obligated to give us advanced notice before it enters into any agreement with a third party for the provision of CRM BPO services that we are currently providing (or that are an expansion into complimentary services) so that we can negotiate with Telefónica for the provision of such services and we are required to participate in tenders conducted by Telefónica Group companies for certain CRM BPO services, but may turn down unprofitable business as long as we submit competitive bids (compared to those of other TEF suppliers participating in such tenders) in connection with such tenders. Any business not awarded to us will not be counted towards meeting the minimum revenue commitments of the Telefónica Group companies. However, if a breach of contract, non-achievement of service level agreements and/or poor performance, amongst other events set out in the relevant service contract, result in a reduction of the revenues or in penalties for us, then the minimum revenue commitments will be reduced accordingly for the relevant calendar year.
The evaluation and review of the calculation of the minimum revenue commitments, issues related to compensation payments for not achieving the minimum revenue commitments and any other matters raised for discussing among other stipulations within the MSA, are administered centrally by a committee that meets on a quarterly basis and consists of representatives of both the Telefónica Group companies and us. The MSA is not intended to affect the existing service contracts, which generally remain in effect in accordance with their terms (including their respective payment terms) and are renegotiated individually.
 
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The MSA expires on December 31, 2021, and although the MSA is an umbrella agreement which governs our services agreements with the Telefónica Group companies, the termination of the MSA on December 31, 2021 does not automatically result in a termination of any of the local services agreements in force after that date. The MSA contemplates a right of termination prior to December 31, 2021 in the event of a change of control of the Company occurring as a result of a sale to a Telefónica competitor.
Technology and Operations
We believe we have a flexible, scalable and reliable technology platform that helps us deliver differentiated and customizable services and solutions for our clients. The three key components of our technology strategy are (i) scalable infrastructure, which we use to support and automate our services, and includes data centers, telephony and other systems, (ii) applications, including systems, and analytic tools to enhance and optimize our solutions offering and (iii) our technology organization, which consists of the people and resources to manage and innovate our platform.
Our technology strategy is focused on supporting growth, driving innovation and generating operational efficiency. Our ability to offer advanced technologies to clients is key to sustaining and solidifying our competitive position. To this end, we have identified our business needs, incorporating them in our technology priorities:
 
 	•	 	Decreased time to market : ability to react to client demands and package solutions to address the most applied solutions to common client issues;	
 
 	•	 	Ability to offer new capabilities : use technology as an enabler of growth and client loyalty, offering solutions (e.g. combination of people, process and technology) that make our services highly-respected in the marketplace; and	
 
 	•	 	Business flexibility : customize our solutions to meet client needs and create and offer add-on solutions such as pre-sales consultancy.	
In order to address these identified business needs, our technology strategy focuses on (i) delivering low-cost and reliable IT infrastructure to meet the needs of existing clients and support margin expansion, (ii) providing the ability to add capacity with a highly variable cost structure for new clients and new services with existing clients, (iii) having the ability to develop new products and solutions that can be scaled and rolled out across geographies, (iv) providing standard operational tools and processes aimed at providing the best experience to our clients’ customers and (v) developing common platforms that facilitate centralization of core IT services.
Examples of technology aimed at enabling the delivery of a better customer experience and increase in efficiency include:
 
 	•	 	“Platform voice recognition,” which is a new platform for voice recognition that increased the automation of the service from 5% to 35%;	
 
 	•	 	“VPN training,” which provides access to training for clients from any location with internet connectivity (e.g., hotels, rented spaces, residence, LAN house, among others), addressing the issue of training room availability and reducing associated rental costs; and	
 
 	•	 	“Mobility solution” for clients’ operations, which we developed to meet clients’ need to have the systems available in the field, adding new features to improve daily tasks.	
Our technology group is one of our key operational teams and includes employees in Brazil, the Americas and EMEA. We have multiple technology solutions to provide our services, most of which are developed in-house with our own methodologies and integrated through our technology platform. We believe we have
 
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specialized and skilled personnel for all activities, focused on new service and solutions development, and around-the-clock operational technical support. As of June 30, 2014, we had 1,162 IT employees distributed as 50.8% for technical support, 22.6% for infrastructure maintenance and implementation, 14.4% for new product development and 12.2% for corporate system support and other functions.
We benefit from a reliable technology platform for our delivery centers, using products from leading suppliers in the CRM BPO industry. In 2013, our investment in technology (hardware and software) was $36.3 million. Due to the increasing development and integration capacity of our technical team, we believe we are in a position to meet market demands and provide a rapid response to our clients.
We partner with major vendors for operations management control, providing intelligent interactive routing through computer telephony integration (“CTI”), outbound sales automation (referred to as “Dialers”), intelligent routing (referred to as IVR), quality management (referred to as “Voice Recording”), business intelligence (“BI”), workforce management (“WFM”), in-person services automation (referred to as “PDAs”) and enterprise resource planning (“ERP”). We believe our partnership with vendors has allowed us to achieve the optimal integration of technologies and deliver a variety of new services intended to meet the specific demands of our clients while keeping our platform flexible and technology agnostic, meaning it can integrate with any client system. An example of such partnership is our relationship with Microsoft, resulting in a range of developments including management information and CRM systems, and our collaboration with Avaya, where we have built our core voice delivery capability around their platform.
During the year ended December 31, 2013, we implemented several new services or extensions of current services for our clients, employing both our technology and infrastructure capabilities, specifically tailored to satisfy their requirements. For example, we implemented a new delivery center in Brazil with 2,000 workstations in approximately 90 days. This operation included the integration of an ACD with our voice recording platform and IVR, predictive dialer and multi-channel platform (including integrated chat and email platform) as an automation tool. For service extensions, we executed an update in our delivery center by migrating 1,000 workstations to the Voice over Internet Protocol technology (“VoIP”) in approximately 15 days.
Technology Reports . In our platform, we have also incorporated a set of online statistics to provide a wide range of information to help facilitate timely and flexible decision-making by our clients. The online reports for clients include data such as total sales figures, effective contacts or no contacts and may also be accessed through mobile devices. This data contains details based on specific variables such as the number of interactions by campaign, numbers of interactions per hour or day, and productivity, among others. These tools are important for clients who want to understand sales patterns in order to improve their business development strategies. We believe it also gives our clients visibility into the customer experience process, increasing transparency and highlighting the benefits of our value-added solutions, which thereby increases the sense of partnership and fosters mutual trust.
Our Infrastructure
Our infrastructure is designed according to our clients’ needs. Our technology systems possess the flexibility to integrate with our clients’ existing infrastructure. This approach enables us to deliver the optimal infrastructure mix through on-shoring, off-shoring or near-shoring as required. Our deployment team is trained to achieve timely implementation so as to minimize our clients’ time-to-market. We address client capacity needs by providing solutions such as software based platforms, high level infrastructure mobility, process centralization and high concentration of delivery centers.
 
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During the last three years, our infrastructure has grown in response to a substantial increase in demand for our services from our clients. As of June 30, 2014, we had 81,625 workstations globally, with 41,384 in Brazil, 32,214 in the Americas (excluding Brazil) and 8,027 in EMEA. As of June 30, 2014, we had 92 delivery centers globally, 26 in Brazil, 44 in the Americas (excluding Brazil) and 22 in EMEA. The following table sets forth the number of delivery centers and workstations in each of the jurisdictions in which we operated as at December 31, 2011, 2012, 2013 and June 30, 2014.

 	  	Number of Workstations	 	  	Number of Service Delivery Centers (1)	 	
Country	  	2011	 	  	2012	 	  	2013	 	  	2014 (5)	 	  	2011	 	  	2012	 	  	2013	 	  	2014 (5)	 	
 	  	(unaudited)	 	
Brazil	  	 	37,663	  	  	 	37,650	  	  	 	39,744	  	  	 	41,384	  	  	 	25	  	  	 	23	  	  	 	26	  	  	 	26	  	
Americas	  	 	29,260	  	  	 	30,891	  	  	 	31,534	  	  	 	32,214	  	  	 	43	  	  	 	44	  	  	 	46	  	  	 	44	  	
Argentina (2)	  	 	3,772	  	  	 	3,793	  	  	 	3,959	  	  	 	3,825	  	  	 	12	  	  	 	12	  	  	 	12	  	  	 	11	  	
Central America (3)	  	 	1,916	  	  	 	1,780	  	  	 	1,666	  	  	 	1,875	  	  	 	4	  	  	 	3	  	  	 	3	  	  	 	3	  	
Chile	  	 	3,693	  	  	 	3,638	  	  	 	3,467	  	  	 	2,398	  	  	 	3	  	  	 	3	  	  	 	3	  	  	 	2	  	
Colombia	  	 	4,748	  	  	 	4,771	  	  	 	4,791	  	  	 	5,687	  	  	 	4	  	  	 	4	  	  	 	6	  	  	 	6	  	
Mexico	  	 	8,042	  	  	 	8,648	  	  	 	9,143	  	  	 	9,739	  	  	 	15	  	  	 	17	  	  	 	17	  	  	 	17	  	
Peru	  	 	6,008	  	  	 	7,150	  	  	 	7,387	  	  	 	7,569	  	  	 	2	  	  	 	2	  	  	 	2	  	  	 	2	  	
United States (4)	  	 	1,081	  	  	 	1,111	  	  	 	1,121	  	  	 	1,121	  	  	 	3	  	  	 	3	  	  	 	3	  	  	 	3	  	
EMEA	  	 	6,326	  	  	 	7,141	  	  	 	7,919	  	  	 	8,027	  	  	 	22	  	  	 	21	  	  	 	21	  	  	 	22	  	
Czech Republic	  	 	456	  	  	 	494	  	  	 	592	  	  	 	568	  	  	 	3	  	  	 	3	  	  	 	3	  	  	 	3	  	
Morocco	  	 	1,694	  	  	 	1,916	  	  	 	1,941	  	  	 	2,045	  	  	 	5	  	  	 	4	  	  	 	4	  	  	 	4	  	
Spain	  	 	4,176	  	  	 	4,731	  	  	 	5,386	  	  	 	5,414	  	  	 	14	  	  	 	14	  	  	 	14	  	  	 	15	  	
Total	  	 	73,249	  	  	 	75,682	  	  	 	79,197	  	  	 	81,625	  	  	 	90	  	  	 	88	  	  	 	93	  	  	 	92	  	

(1)	Includes service delivery centers at facilities operated by us and those owned by our clients where we provide operations personnel and workstations.	
(2)	Includes Uruguay.	
(3)	Includes Guatemala and El Salvador.	
(4)	Includes Puerto Rico.	
(5)	As of June 30, 2014.	
Telecommunications Infrastructure . We work with the main telephone carriers at the local and international levels. We have recently implemented a network to interconnect the main countries in which we operate, allowing us to offer new options of connectivity and to run new applications for videoconferencing. Since almost all our voice platform is based on IP technology, we have implemented a solid and flexible telecommunications infrastructure, which provides business continuity through redundant architectures and interconnection schemes in most of our facilities. In 2013 we had less than 0.06% unscheduled systems downtime.
Quality Operations. We have implemented strong quality standards into our operations with an emphasis on operational excellence, product management and statistical analysis to improve our performance and provide better results for our clients. We have received international quality certifications in most of the countries in which we operate, including the UNE-ISO 9001-2008 certification in Mexico, Central America, Peru, Colombia, Argentina, Chile, Brazil, Spain, Morocco and the Czech Republic as well as the ISO-27001 certification in the United States and Mexico. We have also received local quality certifications as such as the “Probare” certification in Brazil, the “Proveedor Confiable” certification in México and the “Madrid Excelente” certification in Spain. In addition, we also have implemented a rigorous and systematic Six Sigma methodology that utilizes statistical analysis to measure and improve our operational performance.
Intellectual Property and Our Brand
We believe the “Atento” trademark is a recognized and trusted brand in the CRM BPO services industry in each of the markets where we operate. We believe we have a strong corporate brand that gives credibility to our
 
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products and may offer and facilitate our entrance and growth into future market. This also allows us to attract and retain the best talent, to generate a sense of pride in our staff and to develop a relationship of commitment, confidence and trust with our clients. On May 24, 2011, we executed an agreement with Telefónica regarding the assignment of all trademarks and commercial names owned by Telefónica, which included the “Atento” trademark.
Under the Berne Convention for the Protection of Literary and Artistic Works, the trademarks and copyrights noted are recognized in all countries that are signatories to the convention and no other registration or license is required for its use. As of April 2014, all the countries in which we operate have signed the Berne Convention. We do not have any other material intellectual property such as patents or licenses.
Property
We perform our business in service delivery centers leased from third parties, and did not own any real estate as of December 31, 2013, except for one plot of land in Morocco and part of a building in Peru. Additionally, in April 2006, we obtained a grant of use by the Consorcio para el Desarrollo (development consortium) of the province of Jaen in Spain, on a 2,400 square meters field for 30 years, extendable for 15 year periods up to a maximum of 75 years. In 2006, we built a service delivery center at the site. As of December 31, 2013, the rest of our service delivery centers around the world were under lease agreements. Our lease agreements are generally long-term, between one to ten years, some of which provide for extensions. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Factors Affecting Results of Operations—Effect of Operating Leases. ”
Lease expenses on a consolidated basis reached $138.0 million, $124.6 million, $118.3 million and $56.2 million in the years ended December 31, 2011, 2012 and 2013 and the six months ended June 30, 2014, respectively.
Legal Proceedings
We are subject to claims and lawsuits arising in the ordinary course of our business. We make provision for such claims and lawsuits in our annual financial statements to the extent that losses are deemed both probable and quantifiable. We do not believe that the outcome of any pending claims will have a material adverse effect on our business, results of operations, liquidity or financial condition.
Notwithstanding the foregoing, as of June 30, 2014, Atento Brazil was party to approximately 9,738 labor disputes initiated by our employees or former employees for various reasons, such as dismissals or disputes over employment conditions in general. Atento Brazil estimates that the amount involved in these claims total $124.1 million, of which $75.5 million have been classified as probable, $42.6 million classified as possible and $6.0 million classified as remote, based on inputs from external and internal counsels as well as historical statistics. Considering the levels of litigation in Brazil and our historical experience with these types of claims, as of June 30, 2014, we have recognized $75.5 million of provisions ($71.9 million as of December 31, 2013 and $71.8 million as of December 31, 2012), which corresponds to the total amount of the claims whose chances of loss have been classified as probable, and that according to our directors and in consideration of the assessment performed by our legal advisors, is a sufficient amount to cover the risk of payments likely to be made with respect to these claims. Nevertheless, there is a risk that the provisioned amount may not be sufficient to cover the actual contingency to which Atento Brazil is exposed, which could have a material adverse effect on our business, financial condition, results of operations and prospects. In connection with these claims, Atento Brazil and its affiliates have, in accordance with local laws, deposited $49.3 million with the Brazilian courts as security for claims made by employees or former employees (the “Judicial Deposits”). These deposits are accounted for in Other Financial Assets. The yearly net cash contributed to the courts as judicial deposits amounted to $11.7 million in 2013, $16.0 million in 2012 and $23.7 million in 2011.
 
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Moreover, as of June 30, 2014 Atento Brazil was party to 10 civil public actions filed by the Labour Prosecutor’s Office due to alleged irregularities mainly concerning daily and general working routine, lack of overtime control and improper health and safety conditions in the workplace. The total amount involved in these claims was approximately BRL67.7 million, of which BRL2 million relate to claims that have been classified as probable by our internal and external lawyers, for which amount Atento Brazil has established a reserve, as indicated in the paragraph above. We expect that our ultimate liability for these claims, if any, will be substantially less than the full amount claimed. These claims are generally brought with respect to specific jurisdictions in Brazil, and it is possible that in the future similar claims could be brought against us in additional jurisdictions. We cannot assure you that these current claims or future claims brought against us will not result in liability to us, and that such liability would not have a material adverse effect on our business, financial condition and results of operations.
Employees and Culture
We believe that our people are key enablers to our business model and a strategic pillar to our competitive advantage. We focus on reinforcing a culture that emphasizes teamwork, improvement of our processes and, most importantly, total dedication to the client. We believe that our distinctive culture is incorporated within all relationships and processes of our organization and fits within our values and goals.
Our culture is sustained by four core values (i) commitment, (ii) trust, (iii) passion and (iv) integrity. We aim to deliver growth by inspiring our people and believe that our values help us deliver on our mission to “ make companies successful by guaranteeing the best customer experience for their clients. ” The critical success factor is to ensure that our entire leadership is aligned with the drivers of our culture that best fit into our business strategy and vision. To that end, we have developed key guiding principles that reinforce and exemplify our core values:
 
 	•	 	we work as a team , understanding our clients’ needs locally but leveraging our global capabilities and scale;	
 
 	•	 	we encourage the spirit of entrepreneurship and innovation ;	
 
 	•	 	we strive to be efficient, agile and streamlined to create value for our clients;	
 
 	•	 	we put passion into everything we do, motivated by the desire to be better , with the ambition to achieve our goals;	
 
 	•	 	we are disciplined financially and operationally; and	
 
 	•	 	we are proud to build a great place to work .	
As a result of that, we were named in 2013 one of the top 25 multinational companies globally to work for by Great Place to Work Institute, putting us alongside companies such as Google, Microsoft and The Coca-Cola Company. Furthermore, we have received the most country-level Great Place to Work prizes in the CRM BPO industry. Because our solutions are delivered through our approximately 155,000 employees, we believe that our high levels of demonstrated employee satisfaction enable us to deliver a differentiated customer experience compared to our competitors and clients in-house.
Incentive Model
Our management team’s interests are aligned as the key drivers for management’s compensation are (i) the creation of shareholder value, (ii) increased growth in our business (especially with new clients) and (iii) the improvement of our margins.
To pursue the delivery of our strategic goals, we periodically evaluate the contribution and development of our employees. The evaluation of our employees is performed in our annual management review, which impacts many talent management processes, including compensation reviews, training and development initiatives and mobility moves. The management review process is based on reviewing an employee’s performance, competencies and potential assessment (i.e., director, managers and leaders).
 
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Our compensation model is principally driven by our vision and mission, organizational culture, external and internal environment, business strategy and our organizational model. These considerations are translated into a “Total Compensation Model,” under which we consider compensation, benefits, work/life balance, performance and recognition, development and career opportunities to attract, retain, engage and motivate our current and future employees. The main pillars of the model, particularly in relation to structure personnel, are job grading methodology, base salary, bonus scheme, long-term incentives, international mobility and other benefits.
Employees
For the six months ended June 30, 2014, our average and period end number of employees were 153,641 and 151,903, respectively (excluding internships). The following table sets forth the number of employees (excluding internships) we had on a geographical basis (excluding Venezuela) for average 2011, 2012 and 2013.

 	  	Yearly Average	 	
 	  	2011	 	  	2012	 	  	2013	 	  	2014 (1)	 	
Brazil	  	 	79,664	  	  	 	82,973	  	  	 	86,413	  	  	 	83,289	  	
Americas	  	 	49,360	  	  	 	49,871	  	  	 	53,037	  	  	 	55,512	  	
EMEA	  	 	17,912	  	  	 	17,316	  	  	 	16,307	  	  	 	14,771	  	
Headquarters	  	 	106	  	  	 	89	  	  	 	75	  	  	 	69	  	
Total	  	 	147,042	  	  	 	150,248	  	  	 	155,832	  	  	 	153,641	  	

(1)	June 30, 2014.	
For the year ended December 31, 2011, an average of 68.5% of our staff had permanent employment contracts as compared to an average of 69.0% as at December 31, 2012, 74.9% as at December 31, 2013 and 74.9% for the six months ended June 30, 2014.
Employee Training and Motivation
We focus on attracting and retaining talents. Our methodology consists in a global selection process with common phases for each profile and a consistent methodology, as well as integrated selection tools and systems with well-defined criteria in identifying desired employee profiles. This integrated approach allows us to create a consistent selection process across geographies, promoting adherence of new employees to our core values, with the ultimate goal of improving business performance.
We also developed over time motivational initiatives (Rally program) designed for the operational staff to improve results and strengthen the sense of belonging. This initiative was originally set up as an instrument for generating points of contact and relations between staff and our brand and values. The program includes a series of quarterly events involving cultural, recreational, sports and social activities that are open to all employees.
Employee Satisfaction . The level of employee satisfaction within the work environment is important to us. We participate in the “Great Place to Work” survey, held locally by the Great Place to Work Institute. The survey measures perceptions of employees about the work environment and allows for comparison against other participating companies at certain local and regional levels. In 2013, we were recognized as one of the top 25 companies to work for according to Great Place to Work Institute’s ranking of the World’s Best Multinational Workplaces, putting it alongside companies such as Google, Microsoft and The Coca-Cola Company. Additionally, we have won numerous Great Place to Work recognitions regionally, in both South and Central America, and in the countries where we operate. In 2013, we were listed among the “Great Place to Work” companies in eleven of the fifteen countries where we operate (Brazil, Argentina, Colombia, Chile, El Salvador, Guatemala, Mexico, Peru, Puerto Rico, Spain and Uruguay). Notably, we also received the #1 Great Place to Work in Colombia for two consecutive years.
 
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Labor/Collective Negotiation
We closely monitor the management of labor relations and it is an important element for the success of our business and results of operations.
As of December 31, 2013, we had in place collective bargaining agreements in seven countries, including Argentina, Brazil, Chile, Mexico, Peru and Spain, which govern our relationships with most of the employees in those countries. As of December 31, 2011, 2012 and 2013, 82.0%, 80.5% and 79.6%, respectively, of our employees were under collective bargaining agreements. As of June 30, 2014, 78.2% of our employees were under collective bargaining agreements. See “Risk Factors—Risks Related to Our Business—If we experience challenges with respect to labor relations, our overall operating costs and profitability could be adversely affected and our reputation could be harmed.” Our collective bargaining agreements are generally renegotiated every one to three years with the principal labor unions in the countries where we have such agreements. In general, the collective bargaining agreements include terms that regulate remuneration, minimum salary, salary complements, extra time, benefits, bonuses and partial disability.
In Brazil, our most important collective bargaining agreement is in São Paulo, and it is re-negotiated every year. We have already finalized agreements for 2014 in the most important cities in Brazil including São Paulo where we agreed salary increases of 4.9% to 6.8%, compared to a 6.2% increase in the consumer price index in 2013, according to the IMF.
In Mexico, our most significant collective bargaining agreement, in terms of number of employees, is in Mexico DF and it is re-negotiated every year. In 2014, a 4% salary increase was agreed for all employees under the collective bargaining agreement, compared to a 3.8% increase in the consumer price index in 2013, according to the IMF.
In Spain, there is a collective bargaining agreement for all of the contact center companies in the country, which is negotiated through the “ Asociación de Contact Center Española ,” a committee comprised of representatives from five of the six largest contact center companies in Spain, of which we are one. The current collective bargaining agreement is due to terminate on December 31, 2014 and stipulates, among other things, annual salary increases for 2013 and 2014.
History and Structure
Commencement of Activities and Geographical Expansion (1999-2001)
We were founded in 1999 to consolidate the Telefónica Group’s CRM services into a single company to take advantage of the expected demand in CRM services and to capture efficiencies of scale, with the start-up of our operations in Brazil, Chile, El Salvador, Guatemala, Peru, Puerto Rico and Spain. By 2000, we had continued our expansion into Latin America and launched our operations in Argentina, Colombia and Venezuela, while further growing our Brazilian operations. We also launched our operations in Morocco. By 2001, with the launch of our operations in Mexico, we had established a presence in 13 countries. We then began to increase our focus on consolidation and business profitability.
Business Consolidation (2002-2003)
In 2002, we improved our commercial efficiency and adjusted our cost structure to maintain our position as one of the main operators in the CRM BPO market. Beginning in 2003, we concentrated our efforts on defining our business strategy with the aim of creating sustained and profitable growth in the coming years. This strategy focused on providing differentiating services through quality and adding value to our clients’ businesses and building and maintaining long-term relationships.
 
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Differentiation through Services and Relationships and Profitable Growth (2003-2007)
We continued our geographic expansion launching our Uruguay operations and our commercial offices in France in 2006 and Panama in 2007. From 2003 to 2007, we focused on implementing our differentiation strategy by offering higher quality solutions, superior value-added services and developing and maintaining long-term relationships. This strategy was very successful, delivering a significant increase in revenue and operating profit during the years from 2003 to 2007.
Differentiation through Efficiency and Innovation (2008-2011)
In 2008, we broadened our strategic targets to include the pursuit and provision of new business opportunities, while continuing our strategy of differentiation by offering higher quality solutions, superior value-added services and building and maintaining long-term relationships. We also expanded our geographical presence in 2008 with the purchase of Telemarketing Prague, a.s., in the Czech Republic. In 2009, we began operations in the United States.
Establishing a Standalone Business (2012-2014)
In December 2012, Bain Capital acquired the Atento Group from Telefónica. We believe that the transition from a Telefónica subsidiary to a standalone business was successful with (i) no business disruption as a result of the carve-out, (ii) continued confidence from our long-standing clients and (iii) continued support from our banking community. There were significant efforts in strengthening our senior management team, including the appointment of a new Chief Financial Officer, Chief Technology Officer and Chief Commercial Officer, and the reinforcement of our salesforce to actively pursue Telecom clients other than Telefónica and target cross-border multinational clients.
In order to reinforce our partnership with Telefónica, in 2012 we signed the MSA with a nine year term through 2021, which includes annual minimum revenue commitments in all jurisdictions (except for Argentina).
 
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 INDUSTRY OVERVIEW
We are the leading company in the CRM BPO segment of the Latin American BPO market with market share of 20.1% based on revenue. We are the market leader in five of the six main Latin American markets in which we operate and believe that the Latin American CRM BPO market is a large and underpenetrated market with growth that will outpace the global market.
The CRM BPO market is a higher growth market in Latin America with 8.0% growth in 2013, on a constant currency basis. End market demand growth in Latin America is fueled by an expanding Latin American middle class, which came to a rise as a result of higher GDP growth in the last decade. End markets relevant for CRM BPO services include larger and established segments such as telecom, but also penetrating segments such as financial services, healthcare and consumer products, amongst others. According to Frost & Sullivan, call center seat penetration in Latin American countries significantly lags the United States and Spain, and continued penetration of outsourced customer management services will be a driver of growth for the CRM BPO industry. Furthermore, there is also potential for North American CRM BPO services to be further near-shored to Latin America.
We are well positioned to continue to capture growth and gain share in this market with secular growth tailwinds. We believe that our regional expertise, economies of scale, highly engaged employee base and comprehensive service capabilities will enable us to differentially grow our already large blue chip client base and deliver highly value added, customized solutions to our clients.
The table below illustrates how the Latin American CRM BPO market is different from the more mature and fragmented CRM BPO market in North America.

Growth Thesis	  	Metric	  	North
America	 	 	Latin
America	 	
High growth	  	2012-2017E CRM BPO market growth CAGR	  	 	4.2	% 	 	 	9.7	% (2)  	
Penetration tail winds	  	Total CRM call center seats / ‘000s population	  	 	15.8	(1)  	 	 	3.0	  	
Consolidated industry	  	2012 Market share of top 3 competitors	  	 	16.2	% 	 	 	44.7	% 	

Source:	Frost & Sullivan and International Monetary Fund estimates.	
(1)	Figure representative of the United States only.	
(2)	Adjusted for constant currency using foreign exchange spot rates provided on page ii of this prospectus.	
Global BPO Market
Business process outsourcing has continued to grow in recent years as more enterprises realize the cost savings and efficiency that can be accomplished by outsourcing non-core business processes. BPO enables organizations to: (i) focus on their core capabilities, (ii) have greater control over costs and budgeting, (iii) increase customer satisfaction, (iv) reduce the time-to-market for new products and services and (v) redeploy capital used in internal processes. Furthermore, we believe that clients receive a higher quality of service in these non-core areas by partnering with a company like us, as we are able to provide solutions as our primary focus.
BPO is the modern practice of organizations engaging a third party to execute non-core business processes such as accounting, billing, customer service, credit management, human resource management, legal services, and printing or IT. The propensity of businesses to outsource continues to grow and the activities outsourced today involve increasingly higher value functionality than even a few years ago, as they now encompass disciplines such as engineering, design, software programming, and business and financial analysis.
The $167.4 billion global BPO market is forecasted to grow at a CAGR of 5.6% from 2013 to 2018 reaching an estimated $220.1 billion by 2018, according to IDC.
 
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This strong growth rate forecast is the result of: (i) the increasing propensity of organizations to outsource, (ii) an increase in economic activity as the developed world continues to recover from the global economic downturn, (iii) organizations looking to achieve a wider range of objectives from outsourcing, resulting in new opportunities for providers such as us and (iv) organizations, particularly those in emerging markets, becoming increasingly aware of the advantages BPO can provide to their businesses such as increased revenue, higher margins, improved working capital management, increased customer satisfaction and enhancement of their competitive position.

 	  	Worldwide BPO Services Revenue by Business Function	 	
 	  	2013	 	  	2014E	 	  	2015E	 	  	2016E	 	  	2017E	 	  	2018E	 	  	CAGR
2013-
2018E	 	
 	  	(US$ in billions)	 	  	(%)	 	
CRM BPO	  	 	60.9	  	  	 	64.5	  	  	 	68.2	  	  	 	72.2	  	  	 	76.6	  	  	 	81.3	  	  	 	5.9	  	
Finance and accounting	  	 	32.0	  	  	 	34.2	  	  	 	36.5	  	  	 	38.8	  	  	 	41.3	  	  	 	43.8	  	  	 	6.5	  	
Human resources	  	 	20.6	  	  	 	21.4	  	  	 	22.3	  	  	 	23.3	  	  	 	24.3	  	  	 	25.4	  	  	 	4.3	  	
Human resources processing	  	 	50.5	  	  	 	52.9	  	  	 	55.3	  	  	 	57.8	  	  	 	60.5	  	  	 	63.4	  	  	 	4.6	  	
Procurement	  	 	3.3	  	  	 	3.7	  	  	 	4.2	  	  	 	4.8	  	  	 	5.4	  	  	 	6.1	  	  	 	13.1	  	
Total	  	 	167.4	  	  	 	176.6	  	  	 	186.5	  	  	 	196.9	  	  	 	208.0	  	  	 	220.1	  	  	 	5.6	  	
 
Source: 2014 IDC Forecast.
Global CRM BPO Market
CRM BPO is the largest segment within the broader BPO market and is projected to outgrow the BPO market as a whole. It includes the outsourcing of the activities and business processes that an organization undertakes in interacting with its customers or the consumer. These include customer care, retention, acquisition, technical support, help desk services, credit management, sales, marketing, and back-office functions. CRM BPO services can range from simple call handling to managing complex business processes through multiple channels using advanced technological solutions.
It is estimated that worldwide spending on CRM BPO is expected to grow at a CAGR of 5.9% from $60.9 billion in 2013 to $81.3 billion in 2018, according to IDC. Over the same period, Latin America is projected to be the fastest growing region according to Frost & Sullivan, with a forecasted CAGR of 9.8%. North America, a mature market, is expected to grow at a CAGR of 4.2%, and EMEA with a 2.2% CAGR from 2012 to 2017.

 	  	CRM BPO Revenue by Select Regions	 	
 	  	2012	 	  	2013E	 	  	2014E	 	  	2015E	 	  	2016E	 	  	2017E	 	  	CAGR
2012-
2017E	 	
 	  	(US$ in billions)	 	  	(%)	 	
Latin America (1)	  	 	9.5	  	  	 	10.3	  	  	 	11.6	  	  	 	12.7	  	  	 	13.9	  	  	 	15.1	  	  	 	9.7	  	
North America	  	 	23.1	  	  	 	23.9	  	  	 	24.9	  	  	 	26.0	  	  	 	27.2	  	  	 	28.3	  	  	 	4.2	  	
EMEA (2)	  	 	17.4	  	  	 	17.8	  	  	 	18.3	  	  	 	18.6	  	  	 	19.0	  	  	 	19.4	  	  	 	2.2	  	
 
Source: Frost & Sullivan.
Note: Latin American and EMEA market sizes adjusted for constant currency using foreign exchange spot rates provided on page ii of this prospectus.
(1) 2013 market size for Latin America represents actual market size.
(2) 2012 market size for EMEA represents estimate.
Key Trends in the Global CRM BPO Market
There are a number of trends driving projected global growth in the CRM BPO market and we are well-positioned to take advantage of certain of these trends, which we expect will help drive our future growth.
 
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Outsourcing
We expect that the trend for companies to outsource non-core business processes to third party providers will continue in the future. Outsourcing customer service functions enables organizations to focus on their core capabilities while maintaining greater control over costs and budgeting. Additionally, many companies see an increase in customer satisfaction as large third party providers, including ourselves, are able to deliver solutions at consistent quality levels.
Regionalization
In our experience, blue-chip companies are increasingly demanding CRM BPO services and solutions that can be implemented by a single provider across different countries. By seeking out pan-regional providers, these clients intend to achieve consistently high service levels and comprehensive capabilities. We believe that this trend will favor large multi-regional service providers, such as ourselves, who are able to provide services in multiple locations. Local providers struggle to compete against larger providers with an international footprint, product expertise, economies of scale, and a broad service offering.
New Technology / Service Pricing Models
As consumers around the world become more familiar with communicating through the web, chat, SMS and other channels, the proportion of contacts delivered through alternatives to live voice will increase. We expect the usage of higher value-add technologies, delivered through multiple channels, to increase as our clients realize the cost advantages of automation and the business benefits of improved data mining and customer tracking. This transition towards more complex multi-channel solutions creates an opportunity for CRM BPO service providers, including ourselves, to implement success-based components to their contracts.
We have a strong track record in successful pricing propositions to our clients by offering flexible pricing models with fixed pricing, variable pricing, and outcome-based pricing if certain performance indicators are achieved. We also believe that new contracts will increasingly be based on more outcome-based pricing and hybrid pricing models as means of making services more transparent and further driving demand for CRM BPO services. In addition, most of our service contracts with our key clients include inflation-based adjustments to offset adverse inflationary effects. We believe that our flexible pricing models allow us to maximize our revenue in a price competitive environment while maintaining the high quality of our CRM BPO services.
Off-Shoring
The global trends toward off-shoring and near-shoring (the provision of BPO services from a low cost country or region to a client based in a different country) have significantly increased over recent years. The global market for off-shore BPO services (which includes all BPO services) is expected to increase from $5.7 billion in 2012 to $11.2 billion in 2017, a CAGR of 14.5%, according to IDC. While off-shoring from Latin America to other shores is not a risk due to the low-cost domestic outsourcing options available in the region, third party providers in Latin America have been able to capitalize on the chance to cost-effectively serve the North American and European markets. For example, Latin American near-shore CRM BPO revenue from North America is projected to grow at a CAGR of 10.5% from 2012 to 2017, reaching $2.7 billion in 2017, according to Frost & Sullivan.
Latin American CRM BPO Market
The CRM BPO market in Latin America is one of the largest and fastest growing with a size of $10.3 billion in 2013, having grown 8.0% from 2012. The market is driven mainly by domestic demand, which accounted for nearly 77% of the market in 2013, but is gradually shifting to accommodate an off-shore growth opportunity stemming from North American markets. The market is expected to exhibit continued strong growth: revenue is forecasted to increase at a CAGR of 9.8% for the period from 2013 to 2018, with spending totaling $16.3 billion
 
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by 2018, according to Frost & Sullivan. Brazil, the largest market in Latin America, is expected to grow at a 10.3% CAGR from 2013 to 2018, while smaller markets such as Colombia and Peru are expected to grow at 13.6% and 8.6%, respectively, according to multiple studies published by Frost & Sullivan.

 	  	Latin America CRM BPO Revenue by Country	 	
 	  	2013	 	  	2014E	 	  	2015E	 	  	2016E	 	  	2017E	 	  	2018E	 	  	CAGR
2013-
2018E	 	
 	  	(US$ in billions)	 	  	(%)	 	
Argentina	  	 	0.6	  	  	 	0.7	  	  	 	0.8	  	  	 	0.8	  	  	 	0.8	  	  	 	0.9	  	  	 	8.8	  	
Central America & Caribbean	  	 	1.4	  	  	 	1.5	  	  	 	1.7	  	  	 	1.8	  	  	 	2.0	  	  	 	2.1	  	  	 	8.6	  	
Chile	  	 	0.3	  	  	 	0.4	  	  	 	0.4	  	  	 	0.4	  	  	 	0.4	  	  	 	0.4	  	  	 	6.4	  	
Colombia	  	 	1.0	  	  	 	1.2	  	  	 	1.4	  	  	 	1.6	  	  	 	1.8	  	  	 	1.9	  	  	 	13.6	  	
Peru	  	 	0.4	  	  	 	0.4	  	  	 	0.4	  	  	 	0.5	  	  	 	0.5	  	  	 	0.5	  	  	 	8.6	  	
Subtotal	  	 	3.7	  	  	 	4.3	  	  	 	4.7	  	  	 	5.1	  	  	 	5.5	  	  	 	5.9	  	  	 	10.0	  	
Mexico	  	 	1.6	  	  	 	1.7	  	  	 	1.9	  	  	 	2.0	  	  	 	2.1	  	  	 	2.3	  	  	 	7.5	  	
Brazil	  	 	5.0	  	  	 	5.6	  	  	 	6.2	  	  	 	6.8	  	  	 	7.5	  	  	 	8.2	  	  	 	10.3	  	
Total	  	 	10.3	  	  	 	11.6	  	  	 	12.7	  	  	 	13.9	  	  	 	15.1	  	  	 	16.3	  	  	 	9.8	  	
 
Source: Frost & Sullivan’s LatAm Market Research.
Note: Market sizes adjusted for constant currency using FX spot rates provided on page ii of this prospectus.
Key Trends in the Latin American CRM BPO Market
There are a number of trends driving growth in the Latin American CRM BPO market and we believe our market position will allow us to differentiate ourselves and capitalize on this growth.
Large CRM BPO Market with Sustained Demand Growth Driven by an Emerging Middle Class. The scale and growth of Latin America’s economies present a large market opportunity. Latin American GDP has grown significantly faster than global GDP in recent years and is expected to continue to grow at attractive rates. According to EIU, Latin American GDP grew at an average annual rate of 3.5% from 2006-2012 compared to 2.1% globally. This growth is supported by an expanding middle class, which is expected to grow from approximately 29% of the population in 2009, to approximately 42% by the year 2030, according to data from The World Bank.
As a result, customer experience-intensive industries, such as insurance and banking which have historically been underpenetrated in Latin America have experienced high volume growth, resulting in increased demand for CRM BPO services. For example, the addressable banking market in Brazil continues to grow, with approximately 61% of the population that is 15 years or older engaging in banking activities in 2013 compared to only approximately 40% in 2007, according to Euromonitor. Total insurance premiums paid in Brazil grew at a CAGR of approximately 18% from 2007 to 2013, according to the Ernst & Young Latin America Insurance Outlook published in 2014.
We believe that the projected strong growth rates create an opportunity for less prevalent industries in Latin America to expand the number of dedicated agent seats. In 2013, only 51% of outsourced CRM BPO call center seats were utilized to provide services to end market verticals other than telecommunications, compared to 63% in the United States.
 
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2013 Outsourced CRM Agent Seat Breakdown by End Market Vertical

	  	  	
 
Source: Frost & Sullivan.
Note: “Other” includes Healthcare, Travel & Hospitality, Government, Education and other industries.
Lastly, according to Frost & Sullivan, in 2013, call center seat penetration in Latin America significantly lagged the United States, and we believe that this gap will result in long-term growth for our industry in the region.
2013 Call center seats / ‘000s population

 
Source: Frost & Sullivan and International Monetary Fund.
Note: Includes in-house and outsourced seats.
Continued Trend for Further Outsourcing of CRM BPO Operations
As of 2013, 32.4% of domestic CRM BPO operations in Latin America were outsourced to third-party providers, based on number of agent seats compared to 27.1% in 2007, according to Frost & Sullivan. In the context of high growth in CRM BPO volumes and low levels of automation in the clients we serve, we believe the value proposition for further outsourcing is compelling and enables our clients to (i) focus on their core capabilities, (ii) generate cost efficiencies, (iii) increase customer satisfaction, (iv) reduce the time-to-market for new products and services and (v) redeploy capital used in internal processes. Given these factors, we expect outsourcing penetration in our markets to continue to grow in the future.
Emergence of Multi-Channel Services
Usage of non-voice contact channels and voice automation remains relatively limited in Latin America. Frost & Sullivan estimates that in Latin America in 2012 over 90% of all contacts were live voice calls
 
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(including live agents and automated speech enabled systems) and approximately 90% of contacts were handled by live agents. We expect less traditional channels of delivery to grow as clients require more complex solutions, including collections, technical support, service desk help, back office functions and other BPO processes.
By leveraging existing infrastructure and client relationships, we will be able to deliver increasingly complex solutions and value-added services to clients through multiple channels. By offering such solutions, we can expect greater client stickiness while more efficiently utilizing existing infrastructure, back-filling existing capacity and driving incremental margins.
North American CRM BPO Market
From 2012 to 2017, it is estimated that North American CRM BPO revenue will grow at a CAGR of 4.2%, reaching $28.3 billion in 2017, according to Frost & Sullivan. The CRM BPO market in North America is mature, highly fragmented and competitive. For that reason, we view North America as an off-shore growth opportunity as U.S. based businesses continue to off-shore call center activities.

 	  	North American CRM BPO Off-Shore Market Size by Fulfillment  Markets	 	
 	  	2012	 	  	2013E	 	  	2014E	 	  	2015E	 	  	2016E	 	  	2017E	 	  	CAGR
2012-
2017E	 	
 	  	(US$ in billions)	 	  	(%)	 	
Latin America	  	 	1.7	  	  	 	1.8	  	  	 	2.0	  	  	 	2.3	  	  	 	2.5	  	  	 	2.7	  	  	 	10.5	  	
India	  	 	3.0	  	  	 	3.2	  	  	 	3.4	  	  	 	3.6	  	  	 	3.8	  	  	 	4.0	  	  	 	5.6	  	
Philippines	  	 	2.8	  	  	 	3.1	  	  	 	3.4	  	  	 	3.7	  	  	 	4.0	  	  	 	4.3	  	  	 	8.7	  	
Other	  	 	1.1	  	  	 	1.1	  	  	 	1.2	  	  	 	1.2	  	  	 	1.2	  	  	 	1.3	  	  	 	3.4	  	
Total	  	 	8.6	  	  	 	9.3	  	  	 	9.9	  	  	 	10.7	  	  	 	11.5	  	  	 	12.3	  	  	 	7.4	  	
 
Source: Frost & Sullivan.
North America continues to off-shore call center services to other geographies, with 37.4% of the market off-shored in 2012, and an expected 43.4% off-shored in 2017, according to Frost & Sullivan. Within off-shoring, U.S. clients increasingly choose to near-shore to Latin America to minimize time zone differences that might be experienced when off-shoring to India or the Philippines.
The growth in off-shore services by fulfillment market is led by Latin America with an expected 10.5% CAGR from 2012 to 2017, followed by the Philippines (8.7%), India (5.6%), and other regions (3.4%). As the leading growth outlet, Latin America currently accounts for 19.3% of the North American off-shore market, and is expected to grow to 22.3% by 2017, accounting for $2.7 billion of off-shored revenue, according to Frost & Sullivan.
In fact, many North American companies have begun to accelerate sales and marketing activity in the burgeoning U.S. Hispanic market, and require contact centers to support both English- and Spanish-language calls. These companies are able to take advantage of near-shore opportunities in Latin America that provide a qualified and competitive source of labor, particularly as the labor differential versus the Philippines and India continues to diminish. As the Latin American CRM BPO market leader, this will continue to be a great opportunity for us, and we have already designated dedicated contact center seats to serve the U.S. market.
EMEA CRM BPO Market
It is estimated that total CRM BPO revenue in EMEA will grow at a 2.2% CAGR from 2012 to 2017, reaching $19.4 billion by 2017, according to Frost & Sullivan, adjusted for constant currency. This market is very fragmented because of its geographical nature and the multiple languages and cultures in the region.
As a Company, the majority of our European operations are located in Spain. The CRM BPO market in Spain is expected to grow at a 1.6% CAGR from 2012 to 2017, ultimately reaching a market size of $1.2 billion by 2017, based on revenue, according to Frost & Sullivan.
 
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Competitive Landscape
Global Competitive Landscape
In 2013, we were the second largest company in the global CRM BPO market. In 2013, the market share figures for the top three companies were: Teleperformance S.A. (“Teleperformance”) (5.3%); Atento (3.8%); and Convergys Corporation (“Convergys”) (3.3%), according to company filings, IDC and our estimates. In January 2014, Convergys acquired Stream Global Services (“Stream”), making Convergys the 2nd largest market share on a pro forma basis.
According to Gartner (December 2013), we are positioned as a global market leader and visionary within the CRM BPO market.

We are the largest outsourced CRM BPO solutions provider in Latin America. Although we do not currently have a single, global competitor in all of our markets, there are many companies from different countries that compete with us in various specific markets and countries.
Latin American Competitive Landscape
We are the largest outsourced CRM BPO provider by revenue and headcount in Latin America for the year ended December 31, 2013, according to Frost & Sullivan. In 2012, we had a market share of 20.1% in Latin America compared to 19.1% in 2009, and were the market leader in five of the six countries in which we operate, including Argentina, Brazil, Chile, Mexico, and Peru. In our largest market, Brazil, we have 25.5% market share based on 2013 revenue, and primarily compete with Contax (27.3% market share). Since 2009, we have increased our market share in Brazil (23.3% in 2009, according to Frost & Sullivan), while Contax market
 
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share has reduced over the same period (29.8% in 2009). During 2013, we have continued to grow our market share in Brazil, and as of April 2014 believe that we have overtaken Contax as the number one provider of CRM BPO services.
Atento 2013 Market Share and Position by Country

 
Source: Frost & Sullivan.
(1)	Brazil market share based on Frost & Sullivan, market share position as of Q1 2014 (management estimate).	
(2)	Spain market share as of 2011.	
According to Frost & Sullivan, we have increased our market share of the CRM BPO market in Brazil from 23.3% in 2009 to 25.5% in 2013 second only to Contax, which saw its market share decline from 29.8% to 27.3% in Brazil over the same period. We generated BRL693.0 million ($306.7 million) and BRL681.3 million ($288.9 million) of revenues in Brazil in the fourth quarter of 2013 and first quarter of 2014 respectively while Contax reported revenues for its contact center division in Brazil of BRL683.9 million ($300.5 million) and BRL636.5 million ($273.6 million), respectively, in those periods. Based on this data, we believe we are now the leading CRM BPO provider in Brazil.
Limited Number of Large Scale Operators in Latin America
Very few companies operate large-scale operations across the entire Latin American region. Most companies operate in only one or two Latin American countries, or within multiple markets with more limited scale as compared to Atento. Establishing large scale operations in Latin America presents challenges due to specific country dynamics in the region and the complexity of managing a large and dynamic workforce. The presence of local players with established long-term positions in certain countries also results in specific industry dynamics. For example, in 2013 in Brazil, the top three providers of CRM BPO services in aggregate accounted for 59.2% of the market, whereas in North America the top three providers in aggregate had just a 16.2% share in 2012, according to Frost & Sullivan.
EMEA Competitive Landscape
The EMEA market is dominated by major global providers, followed by a host of smaller regional and locally-owned companies. As a result of its geographical nature and the multiple languages and cultures in the EMEA region, this market is very fragmented. In our primary European market, Spain, we have 22.3% market share. Our largest competitor in Spain is Grupo Konecta with 17.9% share, according to Frost & Sullivan.
 
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 MANAGEMENT
Below is a list of the names and ages (as of the closing date of this offering) of the Issuer’s directors and executive officers and a brief account of the business experience of each of them.

Name	  	Age	 	  	Position	
Alejandro Reynal	  	 	41	  	  	Chief Executive Officer and Director	
Mauricio Montilha	  	 	50	  	  	Chief Financial Officer	
Reyes Cerezo	  	 	49	  	  	Legal and Regulatory Compliance Director	
Iñaki Cebollero	  	 	44	  	  	Human Resources Director	
John Robson	  	 	50	  	  	Technology Director	
Michael Flodin	  	 	51	  	  	Operations Director	
Mariano Castaños	  	 	42	  	  	Commercial Director	
Nelson Armbrust	  	 	50	  	  	Brazil Regional Director	
Miguel Matey	  	 	42	  	  	North America Regional Director	
Juan Enrique Gamé	  	 	53	  	  	South America Regional Director	
José María Pérez Melber	  	 	42	  	  	EMEA Regional Director	
Bruce Dawson	  	 	50	  	  	US Nearshore Regional Director	
Francisco Tosta Valim Filho	  	 	50	  	  	Director	
Melissa Bethell	  	 	39	  	  	Director	
Aurelien Vasseur	  	 	38	  	  	Director	
Mark Nunnelly	  	 	55	  	  	Director	
Luis Javier Castro	  	 	48	  	  	Director	
Stuart Gent	  	 	42	  	  	Director	
Devin O’Reilly	  	 	40	  	  	Director	
Our Executive Officers
Alejandro Reynal, Chief Executive Officer and Director. Mr. Reynal has served as our Chief Executive Officer since October 2011. Mr. Reynal has served as a member of our board of directors since September 2014. Prior to this appointment, he worked at Telefónica’s Headquarters as Corporate Strategy Director for the Telefónica Group and from 2008 until 2011 he served as our EMEA Regional Director. Since he joined Telefónica Group in 2000, Mr. Reynal held various executive positions within Atento. Before his time at Telefónica, he was a Director at The Coca-Cola Company and Business Development Manager for the International Division of The Gap, Inc. He holds an MBA from Harvard Business School and a Bachelor and Master of Engineering degrees from the Georgia Institute of Technology. We believe Mr. Reynal is qualified to serve on our board of directors due to his extensive experience in the CRM BPO and telecommunications industries, corporate strategic development, financial reporting and his knowledge gained from his service on the boards of various other companies.
Mauricio Montilha, Chief Financial Officer. Mr. Montilha has served as our Chief Financial Officer and as a member of the Group’s Management Committee since September 2013. Prior to joining Atento, he served as the Chief Financial Officer for the satellite television company, a subsidiary of DirecTV, SKY Brazil from April 2009. Prior to joining SKY Brazil, he served as the Chief Financial Officer of the Brazilian subsidiary of the pharmaceutical company Astra Zeneca, a multinational company with operations in 45 countries. Mr. Montilha also served in leadership positions with various companies, including as Vice President of Financial Planning at Wal-Mart International and Vice President and Chief Financial Officer of Philips Latin America. Furthermore, he has held important management positions at companies including Pillsbury, Elma Chips (Pepsico Brazil), Unilever Brazil and Arthur Andersen. Mr. Montilha has a degree in accounting from Faculdade Paranaense-FACCAR and an MBA from the Armando Alvares Penteado Foundation (FAAP).
Reyes Cerezo, Legal and Regulatory Compliance Director. Ms. Cerezo has served as our Legal and Regulatory Compliance Director since January 2008, as well as serving as the Secretary of our Board of
 
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Directors. From 2008 to 2011, Ms. Cerezo served as a member of our Board of Directors. From 2002 to 2007, Ms. Cerezo served as our General Secretary. From 1991 to 2002, Ms. Cerezo worked at Banco Santander Central Hispano. From 1999 to 2002, she was Secretary of the Board of Directors of Sistemas 4B, S.A. Ms. Cerezo has a law degree from the University of Córdoba and holds a General Management degree from IESE.
Iñaki Cebollero, Human Resources Director. Mr. Cebollero has served as our Human Resources Director since November 2011. Prior to assuming his current post, from July 2011 to November 2011 served as our Director of Organization and Development, joining Atento as People Director, initially in Spain and then going on to head the People Area for the EMEA Region. Prior to joining Atento, Mr. Cebollero’s experience encompassed posts such as Head of Human Resources at Sedesa Construcciones and later at Construcciones CMS, Head of Human Resources for Iberia at Ahold, and Director of Human Resources at Leroy Merlín Spain. He holds a degree in Politics and Sociology from Madrid’s Universidad Complutense, a master degree in HR Management from the University of California and attended the Management Development Program at IESE.
John Robson, Technology Director. Mr. Robson has served as our Technology Director since July 2013. Prior to joining Atento, he served as the Chief Information Officer for the customer relationship management and debt collection company, Transcom WorldWide S.A. from 2009 to 2013. Prior to Transcom Worldwide S.A, Mr. Robson served as the Global Chief Technology Officer for SITEL Corporation. Mr. Robson has also served in senior information technology roles for both public and private companies, including Verizon Business Security Solutions, MCI and NETSEC as well as Chief Technology Officer at Liberata PLC. Mr. Robson holds a Higher National Diploma in computer science from Teesside Polytechnic in the United Kingdom.
Michael Flodin, Operations Director. Mr. Flodin has served as our Operations Director since April 2014. Mr. Flodin is a senior executive with more than 25 years of experience, having spent the 16 years prior to joining Atento as partner at Accenture’s Customer Relationship Management Practice. He has a patent pending for a Business-to-Business Customer Experience Framework and Implementation Plan, has been published in CRM Magazine, and has been keynote speaker at several major CRM conferences in North America and Brazil. He holds a bachelor of arts degree in psychology and a philosophy from Flagler College.
Mariano Castaños, Commercial Director. Mr. Castaños has served as our Commercial Director since December 2013. Mr. Castaños began his professional career in Argentina in legal services. Prior to joining the Management Committee as EMEA Regional Director in September 2012, he was Country Director for Atento Spain (including three operations in Morocco, Peru and Colombia). Mr. Castaños joined Atento Argentina in 2004, initially as Sales Manager, going on to the position of Marketing and Sales Director. In 2008 he was promoted to Telefónica Account Director for Atento Spain. In 2000, he joined the Clarín Group as Business Development Manager and then became Americas Strategic Alliance Manager. Mr. Castaños holds a law degree from Universidad Católica Argentina, a master degree in Company Law from Ucema and a PDD (Management Development Programme) from IESE, Spain.
Nelson Armbrust, Brazil Regional Director. Mr. Armbrust has served as our Brazil Regional Director since May 2010. Mr. Armbrust joined Atento in 1999. From 2000 until 2009, Mr. Armbrust served in various executive posts encompassing Argentina and Uruguay, USA and Central America. In 2009, he returned to Brazil as Multisector Executive Director. Mr. Armbrust began his career in 1987 at Siemens Brazil. Mr. Armbrust holds a degree in Electronic Engineering from the Universidad Católica de Río de Janeiro and a master degree in business administration from the University of São Paulo.
Miguel Matey, North America Regional Director. Mr. Matey has served as our North America Regional Director since September 2012 and previously served as Mexico Country Director since January 2012. Prior to this, in 2011, he served as Regional Director for Morocco, France and the Czech Republic. Mr. Matey joined Atento Spain in 2000 and in 2003 he went on to Atento’s Mexican and Central American operations as business manager. From 2004 to 2006, he headed the Business Unit in Central America and the Telefónica Business Unit
 
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in Mexico. From 2007 to 2010 he served as Business Director at Atento Spain. Mr. Matey holds a degree in Business and Economics from Madrid’s Universidad Complutense and a master degree in business administration from the IE Business School.
Juan Enrique Gamé, South America Regional Director. Mr. Gamé has served as our South America Regional Director since November 2011. He began working at Atento in 2002 as Multisector Business Director. From 2004 to 2008 Mr. Gamé was General Manager of Atento Peru and in 2010 he became Regional Manager of Atento Chile. Mr. Gamé holds a degree in Civil Industrial Engineering from the Universidad Católica de Valparaíso and an MBA and Diploma in Distribution and Logistics Management from Universidad Adolfo Ibáñez.
José María Pérez Melber, EMEA Regional Director. Mr. Melber has served as our EMEA Regional Director since March 2014. He has worked in the industry for over ten years. Prior to joining Atento, Mr. Pérez Melber served as Operations Director at Orange Spain, with direct responsibility over customer care, loyalty, retention, billing and credit management from July 2011 until February 2014. Before that, Mr. Pérez Melber worked at Transcom in 2004 as Global Manager of Tele2. In 2006, he was appointed General Director of Transcom Iberia & Latam and to the company’s Executive Committee, a position he held until 2009 when he was named General Director for Southern Europe, Latam and North Africa. Prior to his arrival at Transcom, Mr. Pérez Melber worked in marketing and customer relations within the insurance sector. Mr. Pérez Melber holds a degree in Business Administration and Insurance Sciences from Universidad Pontificia de Salamanca.
Bruce Dawson, US Nearshore Regional Director . Mr. Dawson has served as our US Nearshore Regional Director since April 2014. Mr. Dawson is a senior executive—Global BPO & Captive Operations professional with 22 years of experience leading companies with global footprints (onshore, offshore, nearshore, North America, Latin America, Europe, Asia-Pacific). Prior to joining us, Mr. Dawson served at Sitel from October 2012 to March 2014 and Stream from October 2008 to August 2012. Mr. Dawson has held management positions at various companies in the BPO industry bringing as well experience from the software and telecommunications sector. He holds a BA in Psychology from Denison University.
Our Directors
We believe that our board of directors is, and we intend that it continue to be, composed of individuals with sophistication and experience in many substantive areas that impact our business. We believe that all of our current board members possess the professional and personal qualifications necessary for board service, and have highlighted the specific experience, qualifications, attributes, and skills that led to the conclusion that each board member should serve as a director in the individual biographies below (information with respect to Mr. Reynal, our Chief Executive Officer and a member of our board of directors, is set forth above).
Francisco Tosta Valim Filho, Director . Mr. Valim has served as a member of our board of directors since April 2014. Mr. Valim served as Chief Executive Officer of Via Varejo from August 2013 until April 2014 and of Oi S.A. from August 2011 until January 2013. From January 2008 to July 2011, Mr. Valim was the Chief Executive Officer of Experian for Latin America, Europe and the Middle East. Prior to working at Experian, he served as Chief Executive Officer of NET Serviços de Comunicação S.A. from February 2003 to January 2008, Chief Financial Officer of Oi from January 2002 to February 2003; and Vice-President and Chief Financial Officer of RBS Participações S.A. from September 1989 to December 2001. Mr. Valim holds an MBA from the Marshall School of Business—University of Southern California and a bachelor of arts degree in Business Administration from Universidade Federal do Rio Grande do Sul (UFRGS) with advanced studies degrees in Finance from Fundação Getulio Vargas and Planning and Organization from UFRGS. We believe Mr. Valim’s qualifications to serve on our board of directors include his extensive experience in the telecommunications industry, strategic development, financial reporting and his knowledge gained from service on the boards of various other companies.
Melissa Bethell, Director . Ms. Bethell has served as a member of Topco’s board of directors since the consummation of the Acquisition in December 2012 and a member of the Issuer’s board of directors since March
 
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2014. Ms. Bethell is a Managing Director of Bain Capital, which she joined in 1999 and relocated from Boston to London in 2000 as a member of Bain Capital’s European investment team. Prior to joining Bain Capital, Ms. Bethell worked in the Capital Markets group at Goldman, Sachs & Co., with a focus on media and technology fundraising. She received her master in business administration with distinction from Harvard Business School and a bachelor of arts degree with honors in Economics and Political Science from Stanford University. We believe Ms. Bethell’s qualifications to serve on our board of directors include her extensive experience in the telecom, media and technology industries, strategic development, financial reporting and her knowledge gained from service on the boards of various other companies.
Aurelien Vasseur , Director . Mr. Vasseur has served as a member of the Issuer’s board of directors since March 2014. Mr. Vasseur joined Bain Capital Luxembourg S.à r.l. in June 2011 and is a corporate manager of the firm. Before joining Bain Capital, Mr. Vasseur was a finance auditor at Ernst & Young, Luxembourg from 2004 until May 2011. Mr. Vasseur received a master degree in management from the Ecole des Hautes Etudes Commerciales (EDHEC Business School). We believe Mr. Vasseur’s qualifications to serve on our board of directors include his extensive experience in the business and financial services industry, knowledge of our business, financial reporting and his knowledge gained from service on the boards of various other companies.
Mark Nunnelly, Director. Mr. Nunnelly has served as a member of our board of directors since September 2014. Mr. Nunnelly joined Bain Capital in 1990 and was a Managing Director until he retired from the firm in 2014. Prior to joining Bain Capital, Mr. Nunnelly was a Vice President at Bain & Company, with experience in the United States, Asian and European strategy practices. Previously, Mr. Nunnelly worked at Procter & Gamble in product management. He also founded and had operating responsibility for several new ventures. Mr. Nunnelly received an MBA with Distinction from Harvard Business School and received an A.B. from Centre College. Mr. Nunnelly is currently on the Board of Directors of Bloomin’ Brands, Dunkin’ Brands, Genpact, Apple Leisure Group and BMC Software. We believe Mr. Nunnelly’s qualifications to serve on our board of directors include his extensive experience in the business and financial services industry, strategic development, financial reporting and his knowledge gained from service on the boards of various other companies.
Luis Javier Castro, Director. Mr. Castro has served as a member of our board of directors since September 2014. He began his career as an associate at Bain & Company, working on strategic cases for several of the largest companies in Central America. In 1996, he was one of the founding partners of Central America’s first private equity fund, Mesoamerica Fund I, L.P. From 1998 to 2003, he was the CEO for Mesoamerica Telecom Ltd., organizing and supervising this fund—the largest private equity fund at the time in Central America. In 1998, along with three other partners, he founded Mesoamerica Investments where he continues to serve as a Managing Partner. Mr. Castro is a director of several companies, including Café OMA, Presto, Globeleq Mesoamerica Energy, among others. Mr. Castro is a member of the G-50, a select group of business leaders of the Americas, a member of the United Way Latin American Regional Committee, a member of the Central America Leadership Initiative’s board and an Aspen Institute fellow. He received an MBA from Georgetown University and a degree in science and agricultural economics from Texas A&M University. We believe Mr. Castro’s qualifications to serve on our board of directors include his extensive experience in the business and financial services industry, strategic development, financial reporting and his knowledge gained from service on the boards of various other companies.
Stuart Gent , Director. Mr. Gent has served as a member of our board of directors since September 2014. Mr. Gent joined Bain Capital in 2007 and is a Managing Director in the London office. Prior to joining Bain Capital, Mr. Gent was a Managing Director of Avis UK and a member of the Avis Europe Executive Board. Previously, Mr. Gent was a Partner at Bain & Company where he worked in a variety of industries. Mr. Gent received a BSc from Bristol University in England. Mr. Gent is currently on the Board of Directors of WorldPay, Brakes Bros and EWOS. We believe Mr. Gent’s qualifications to serve on our board of directors include his extensive experience in the business and financial services industry, strategic development, financial reporting and his knowledge gained from service on the boards of various other companies.
Devin O’Reilly , Director . Mr. O’Reilly has served as a member of our board of directors since September 2014. Mr. O’Reilly joined Bain Capital in 2005 and is a Managing Director in the London office. Prior to joining
 
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Bain Capital, Mr. O’Reilly was a consultant at Bain & Company where he consulted for private equity and healthcare industry clients. Previously, he spent several years in the software industry in corporate development and general management roles. Mr. O’Reilly received an MBA from The Wharton School at the University of Pennsylvania, and graduated with a BA from Princeton University. Mr. O’Reilly is currently on the Board of Directors of Bio Products Laboratory, Intermedica and Brakes Bros. We believe Mr. O’Reilly’s qualifications to serve on our board of directors include his extensive experience in the business and financial services industry, strategic development, financial reporting and his knowledge gained from service on the boards of various other companies.
Corporate Governance
Board Composition
Prior to the completion of this offering, our articles of association will provide that our board of directors shall consist between three (3) and fifteen (15) directors as determined from time to time by resolution adopted by the general meeting of the shareholders of the Company.
Upon completion of this offering our board of directors will be divided into three classes of directors, with the classes as nearly equal in number as possible. As a result, approximately one-third of our board of directors will be elected each year. The classification of directors will have the effect of making it more difficult for stockholders to change the composition of our board.
Upon completion of this offering, our board of directors will consist of eight members.
Controlled Company and Foreign Private Issuer
Upon completion of this offering, affiliates of Bain Capital will continue to control a majority of the voting power of our outstanding ordinary shares. As a result, we will be a “controlled company” under the New York Stock Exchange corporate governance standards. As a controlled company, exemptions under the New York Stock Exchange standards will free us from the obligation to comply with certain corporate governance requirements, including the requirements:
 
 	•	 	that a majority of our board of directors consists of “independent directors,” as defined under the rules of the New York Stock Exchange;	
 
 	•	 	that we have a corporate governance and nominating committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities;	
 
 	•	 	that we have a compensation committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and	
 
 	•	 	for an annual performance evaluation of the nominating and governance committees and compensation committee.	
These exemptions do not modify the independence requirements for our audit committee requiring it to be comprised exclusively of independent directors, and we intend to comply with the applicable requirements of the Sarbanes-Oxley Act and rules with respect to our audit committee within the applicable time frame. These rules require that our Audit Committee be composed of at least three members, a majority of whom will be independent within 90 days of the date of this prospectus, and all of whom will be independent within one year of the date of this prospectus.
In addition to the controlled company exemptions, as a foreign private issuer, under the corporate governance standards of the New York Stock Exchange, foreign private issuers are permitted to follow home country corporate governance practices instead of the corporate governance practices of the New York Stock Exchange. Accordingly, we intend to follow certain corporate governance practices of our home country, Luxembourg in lieu of certain of the corporate governance requirements of the New York Stock Exchange.
 
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Specifically, we do not intend to have a board of directors composed of a majority of independent directors or a Compensation Committee or Nominating and Corporate Governance Committee composed entirely of independent directors.
As a foreign private issuer, we will also be exempt from the rules and regulations under the Exchange Act, related to the furnishing and content of proxy statements, and our officers, directors and principal shareholders will be exempt from the reporting and short swing profit recovery provisions contained in Section 16 of the Exchange Act. In addition, we will not be required under the Exchange Act to file annual, quarterly and current reports and financial statements with the Securities and Exchange Commission as frequently or as promptly as domestic companies whose securities are registered under the Exchange Act.
Board Committees
Prior to the completion of this offering, our board of directors will have established an Audit Committee and a Compensation Committee. The composition, duties and responsibilities of these committees is as set forth below. In the future, our board may establish other committees, as it deems appropriate, to assist it with its responsibilities.
Audit Committee . The Audit Committee will be responsible for, among other matters: (1) appointing, compensating, retaining, evaluating, terminating and overseeing our independent registered public accounting firm; (2) discussing with our independent registered public accounting firm their independence from management; (3) reviewing with our independent registered public accounting firm the scope and results of their audit; (4) approving all audit and permissible non-audit services to be performed by our independent registered public accounting firm; (5) overseeing the financial reporting process and discussing with management and our independent registered public accounting firm the interim and annual financial statements that we file with the SEC; (6) reviewing and monitoring our accounting principles, accounting policies, financial and accounting controls and compliance with legal and regulatory requirements; (7) overseeing our legal compliance process; (8) establishing procedures for the confidential anonymous submission of concerns regarding questionable accounting, internal controls or auditing matters; and (9) reviewing and approving related party transactions.
Upon completion of this offering, our Audit Committee will consist of Francisco Tosta Valim Filho, Devin O’Reilly and Melissa Bethell. Our board of directors has determined that Francisco Tosta Valim Filho will qualify as an “audit committee financial expert,” as such term is defined in Item 407(d)(5)(ii) of Regulation S-K. Our board of directors will adopt a new written charter for the Audit Committee, which will be available on our corporate website at www.atento.com upon the completion of this offering. Our website is not part of this prospectus.
Compensation Committee . The Compensation Committee will be responsible for, among other matters: (1) reviewing key associate compensation goals, policies, plans and programs; (2) reviewing and approving the compensation of our directors, chief executive officer and other executive officers; (3) reviewing and approving employment agreements and other similar arrangements between us and our executive officers; and (4) the administration of stock plans and other incentive compensation plans.
Upon completion of this offering, our Compensation Committee will consist of Melissa Bethell, Alejandro Reynal and Stuart Gent. Our board of directors will adopt a written charter for the Compensation Committee, which will be available on our corporate website at www.atento.com upon the completion of this offering. Our website is not part of this prospectus.
Compensation Committee Interlocks and Insider Participation
No interlocking relationships exist between the members of our board of directors and the board of directors or compensation committee of any other company.
 
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Code of Business Conduct and Ethics
We have adopted a Code of Business Conduct and Ethics (the “Code”) applicable to all of our directors, officers and employees, including our principal executive officer, principal financial officer and accounting officers, and all persons performing similar functions. A copy of the Code will be available on our corporate website at www.atento.com. Our website is not part of this prospectus. We will provide any person, without charge, upon request, a copy of our Code. Such requests should be made in writing to the attention of our Legal and Regulatory Compliance Director at the following address: C/Quintanavides, n. 17-2 Planta, 28050 Las Tablas, Madrid, Spain.
Risk Oversight
Our board of directors is currently responsible for overseeing our risk management process. The board of directors focuses on our general risk management strategy and the most significant risks facing us, and ensures that appropriate risk mitigation strategies are implemented by management. The board of directors is also apprised of particular risk management matters in connection with its general oversight and approval of corporate matters and significant transactions.
Following the completion of this offering, our board of directors will delegate to the Audit Committee oversight of our risk management process. Our other board committees will also consider and address risk as they perform their respective committee responsibilities. All committees will report to the full board of directors as appropriate, including when a matter rises to the level of a material or enterprise level risk.
Our management is responsible for day-to-day risk management. This oversight includes identifying, evaluating, and addressing potential risks that may exist at the enterprise, strategic, financial, operational, compliance and reporting levels.
Compensation of Directors and Executive Officers
Prior to this offering, we were a privately-held company. As a result, we have not been subject to any stock exchange listing or SEC rules requiring a majority of our board of directors to be independent or relating to the formation and functioning of board committees, including audit, compensation and nominating committees. Most, if not all, of our prior compensation policies and determinations, including those made for 2013, have been the product of negotiations between the executive officers and our Chief Executive Officer and/or board of directors.
The objectives of our compensation policies and programs are to attract, motivate, reward and retain key talent through competitive and cost effective approaches that reinforce executive accountability and reward the achievement of business results. As a new privately-held company, when establishing compensation for executive officers some certain elements of compensation have been the product of negotiations between the executive officers and our Chief Executive Officer and/or board of directors.
In connection with this offering, our board of directors will form a compensation committee to oversee and administer our compensation arrangement, including our 2014 Omnibus Incentive Plan (discussed below). We expect that following this offering, our Chief Executive Officer will review annually each other executive officer’s performance with the compensation committee and recommend appropriate base salary, cash performance awards and grants of long-term equity incentive awards for all other executive officers. Based upon the recommendations of our Chief Executive Officer and in consideration of certain objectives described above, the compensation committee will approve the annual compensation packages of our executive officers other than our Chief Executive Officer. We also expect that the compensation committee will annually analyze our Chief Executive Officer’s performance and determine his base salary, cash performance awards and grants of long-term equity incentive awards based on its assessment of his performance with input from any independent third party consultants engaged by the compensation committee.
 
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The total aggregate compensation paid to our executive officers was $7.9 million during the year ended December 31, 2013. In addition, total benefits in kind amounted to $0.4 million. To date, we have not provided cash compensation to directors for their services as directors or members of committees of the board of directors.
2014 Omnibus Incentive Plan
In connection with this offering, we intend to adopt the 2014 Omnibus Incentive Plan (the “2014 Incentive Plan”). The 2014 Incentive Plan will provide for grants of stock options, stock appreciation rights, restricted stock, other stock-based awards and other cash-based awards. Directors, officers and other employees of us and our subsidiaries, as well as others performing consulting or advisory services for us, will be eligible for grants under the 2014 Incentive Plan. The purpose of the 2014 Incentive Plan is to provide incentives that we expect will attract, retain and motivate high performing officers, directors, employees and consultants by providing them with appropriate incentives and rewards either through a proprietary interest in our long-term success or compensation based on their performance in fulfilling their personal responsibilities. Set forth below is a summary of the material terms of the 2014 Incentive Plan, which is qualified in its entirety by reference to the full version of the 2014 Incentive Plan. In addition, we note that awards issued in non-U.S. jurisdictions will be subject to the requirements of local law and that the 2014 Incentive Plan, and the awards issued thereto, will be administered accordingly.
Administration
The 2014 Incentive Plan will be administered by the board of directors. Among the powers of the board of directors will be to determine the form, amount and other terms and conditions of awards; clarify, construe or resolve any ambiguity in any provision of the 2014 Incentive Plan or any award agreement; amend the terms of outstanding awards; and adopt such rules, forms, instruments and guidelines for administering the 2014 Incentive Plan as it deems necessary or proper. The board of directors will have the authority to administer and interpret the 2014 Incentive Plan, to grant discretionary awards under the 2014 Incentive Plan, to determine the persons to whom awards will be granted, to determine the types of awards to be granted, to determine the terms and conditions of each award, to determine the number of ordinary shares to be covered by each award, to make all other determinations in connection with the 2014 Incentive Plan and the awards thereunder as the board of directors deems necessary or desirable and to delegate authority under the 2014 Incentive Plan to our executive officers.
Available Shares
The aggregate number of ordinary shares which may be issued or used for reference purposes under the 2014 Incentive Plan or with respect to which awards may be granted may not exceed 7,300,000 shares (on an as-converted basis). The maximum number of ordinary shares with respect to which incentive stock options may be granted under the 2014 Incentive Plan shall be 7,300,000 shares (on an as-converted basis). The number of ordinary shares that will be available for issuance under the 2014 Incentive Plan may also be subject to adjustment in the event of a reorganization, stock split, merger or similar change in the corporate structure or the outstanding ordinary shares. In the event of any of these occurrences, we may make any adjustments we consider appropriate to, among other things, the number and kind of shares, options or other property available for issuance under the plan or covered by grants previously made under the plan. The ordinary shares that will be available for issuance under the plan may be, in whole or in part, either authorized and unissued ordinary shares or ordinary shares held in or acquired for our treasury. In general, if awards under the 2014 Incentive Plan are for any reason cancelled, or expire or terminate unexercised, the shares covered by such awards may again be available for the grant of awards under the 2014 Incentive Plan. The maximum number of ordinary shares subject to any award of stock options, or stock appreciation rights which may be granted under the 2014 Incentive Plan during any fiscal year of the Company to any participant shall be 200,000 shares. The maximum grant date fair value of any award which may be granted under the 2014 Incentive Plan during any fiscal year to any director will be $5,000,000.
The maximum number of ordinary shares with respect to which any stock option, stock appreciation right, shares of restricted stock or other stock-based awards that will be subject to the attainment of specified performance goals and
 
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intended to satisfy Section 162(m) of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), and may be granted under the 2014 Incentive Plan during any fiscal year to any eligible individual will be 200,000 shares per type of award (on an as-converted basis). The total number of ordinary shares with respect to all awards that may be granted under the 2014 Incentive Plan during any fiscal year to any eligible individual will be 200,000 shares (on an as-converted basis). There are no annual limits on the number of ordinary shares with respect to an award of restricted stock that are not subject to the attainment of specified performance goals to eligible individuals. The maximum number of ordinary shares subject to any performance award which may be granted under the 2014 Incentive Plan during any fiscal year to any eligible individual will be 200,000 shares (on an as-converted basis). The maximum value of a cash payment made under a performance award which may be granted under the 2014 Incentive Plan during any fiscal year to any eligible individual will be $5,000,000.
Eligibility for Participation
Members of our board of directors, as well as employees of, and consultants to, us or any of our subsidiaries and affiliates will be eligible to receive awards under the 2014 Incentive Plan.
Award Agreement
Awards granted under the 2014 Incentive Plan will be evidenced by award agreements, which need not be identical and which will be modified to the extent necessary to comply with applicable law in the relevant jurisdiction of the respective participant, that provide additional terms, conditions, restrictions and/or limitations covering the grant of the award, including, without limitation, additional terms providing for the acceleration of exercisability or vesting of awards in the event of a change of control or conditions regarding the participant’s employment, as determined by the board of directors.
Stock Options
The board of directors will be able to grant non-qualified stock options to eligible individuals and incentive stock options only to eligible employees. The board of directors will determine the number of ordinary shares subject to each option, the term of each option, which may not exceed ten years, or five years in the case of an incentive stock option granted to a ten percent stockholder, the exercise price, the vesting schedule, if any, and the other material terms of each option. No incentive stock option or non-qualified stock option may have an exercise price less than the fair market value of an ordinary share at the time of grant or, in the case of an incentive stock option granted to a ten percent stockholder, 110% of such share’s fair market value. Options will be exercisable at such time or times and subject to such terms and conditions as determined by the board of directors at grant and the exercisability of such options may be accelerated by the board of directors.
Stock Appreciation Rights
The board of directors will be able to grant stock appreciation rights, which we refer to as SARs, either with a stock option, which may be exercised only at such times and to the extent the related option is exercisable, which we refer to as a Tandem SAR, or independent of a stock option, which we refer to as a Non-Tandem SAR. A SAR is a right to receive a payment in ordinary shares or cash, as determined by the board of directors, equal in value to the excess of the fair market value of one ordinary share on the date of exercise over the exercise price per share established in connection with the grant of the SAR. The term of each SAR may not exceed ten years. The exercise price per share covered by a SAR will be the exercise price per share of the related option in the case of a Tandem SAR and will be the fair market value of our ordinary shares on the date of grant in the case of a Non-Tandem SAR. The Compensation Committee will also be able to grant limited SARs, either as Tandem SARs or Non-Tandem SARs, which may become exercisable only upon the occurrence of a change in control, as defined in the 2014 Incentive Plan, or such other event as the board of directors may designate at the time of grant or thereafter.
Restricted Stock
The board of directors will be able to award shares of restricted stock. Except as otherwise provided by the board of directors upon the award of restricted stock, the recipient will generally have the rights of a stockholder
 
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with respect to the shares, including the right to receive dividends, the right to vote the shares of restricted stock and, conditioned upon full vesting of shares of restricted stock, the right to tender such shares, subject to the conditions and restrictions generally applicable to restricted stock or specifically set forth in the recipient’s restricted stock agreement. The board of directors will be able to determine at the time of award that the payment of dividends, if any, will be deferred until the expiration of the applicable restriction period.
Recipients of restricted stock will be required to enter into a restricted stock agreement with us that states the restrictions to which the shares are subject, which may include satisfaction of pre-established performance goals, and the criteria or date or dates on which such restrictions will lapse.
If the grant of restricted stock or the lapse of the relevant restrictions is based on the attainment of performance goals, the board of directors will establish for each recipient the applicable performance goals, formulae or standards and the applicable vesting percentages with reference to the attainment of such goals or satisfaction of such formulae or standards while the outcome of the performance goals are substantially uncertain. Such performance goals may incorporate provisions for disregarding, or adjusting for, changes in accounting methods, corporate transactions, including, without limitation, dispositions and acquisitions, and other similar events or circumstances. To the extent applicable, Section 162(m) of the Code requires that performance awards be based upon objective performance measures. To the extent applicable, such performance goals for performance-based restricted stock will be based on one or more of the objective criteria set forth on Exhibit A to the 2014 Incentive Plan and are discussed in general below.
Other Stock-Based Awards
The board of directors will be able to, subject to limitations under applicable law, make a grant of such other stock-based awards, including, without limitation, performance units, dividend equivalent units, stock equivalent units, restricted stock and deferred stock units under the 2014 Incentive Plan that are payable in cash or denominated or payable in or valued by ordinary shares or factors that influence the value of such shares. The board of directors will be able to determine the terms and conditions of any such other awards, which may include the achievement of certain minimum performance goals for purposes of compliance with Section 162(m) of the Code and/or a minimum vesting period. The performance goals for performance-based other stock-based awards will be based on one or more of the objective criteria set forth on Exhibit A to the 2014 Incentive Plan and discussed in general below.
Other Cash-Based Awards
The board of directors will be able to grant awards payable in cash. Cash-based awards will be in such form, and dependent on such conditions, as the board of directors will determine, including, without limitation, being subject to the satisfaction of vesting conditions or awarded purely as a bonus and not subject to restrictions or conditions. If a cash-based award is subject to vesting conditions, the board of directors will be able to accelerate the vesting of such award in its discretion.
Performance Awards
The board of directors will be able to grant a performance award to a participant payable upon the attainment of specific performance goals. The board of directors will be able to grant performance awards that are intended to qualify as performance-based compensation under Section 162(m) of the Code as well as performance awards that are not intended to qualify as performance-based compensation under Section 162(m) of the Code. If the performance award is payable in cash, it may be paid upon the attainment of the relevant performance goals either in cash or in shares of restricted stock, based on the then current fair market value of such shares, as determined by the board of directors. Based on service, performance and/or other factors or criteria, the board of directors will be able to, at or after grant, accelerate the vesting of all or any part of any performance award.
 
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Performance Goals
The board of directors will be able to grant awards of restricted stock, performance awards, and other stock-based awards that are intended to qualify as performance-based compensation for purposes of Section 162(m) of the Code, to the extent applicable. These awards may be granted, vest and be paid based on attainment of specified performance goals established by the board of directors. These performance goals may be based on the attainment of a certain target level of, or a specified increase or decrease in, one or more of the following measures selected by the committee: (1) earnings per share; (2) operating income; (3) gross income; (4) net income, before or after taxes; (5) cash flow; (6) gross profit; (7) gross profit return on investment; (8) gross margin return on investment; (9) gross margin; (10) operating margin; (11) working capital; (12) income before interest and taxes; (13) income before interest, tax, depreciation and amortization; (14) return on equity; (15) return on assets; (16) return on capital; (17) return on invested capital; (18) net revenues; (19) gross revenues; (20) revenue growth; (21) annual recurring revenues; (22) recurring revenues; (23) license revenues; (24) sales or market share; (25) total stockholder return; (26) economic value added; (27) specified objectives with regard to limiting the level of increase in all or a portion of our bank debt or other long-term or short-term public or private debt or other similar financial obligations, which may be calculated net of cash balances and other offsets and adjustments as may be established by the Compensation Committee; (28) the fair market value of an ordinary share; (29) the growth in the value of an investment in our ordinary shares assuming the reinvestment of dividends; or (30) reduction in operating expenses.
To the extent permitted by law, the board of directors will also be able to exclude the impact of an event or occurrence which the board of directors determines should be appropriately excluded, such as (1) restructurings, discontinued operations, extraordinary items and other unusual or non-recurring charges; (2) an event either not directly related to our operations or not within the reasonable control of management; or (3) a change in accounting standards required by generally accepted accounting principles.
Performance goals may also be based on an individual participant’s performance goals, as determined by the board of directors.
In addition, all performance goals may be based upon the attainment of specified levels of our performance, or the performance of a subsidiary, division or other operational unit, under one or more of the measures described above relative to the performance of other corporations. The board of directors will be able to designate additional business criteria on which the performance goals may be based or adjust, modify or amend those criteria.
Change in Control
In connection with a change in control, as defined in the 2014 Incentive Plan, the board of directors will be able to accelerate vesting of outstanding awards under the 2014 Incentive Plan. In addition, such awards may be, in the discretion of the committee, (1) assumed and continued or substituted in accordance with applicable law; (2) purchased by us for an amount equal to the excess of the price of an ordinary share paid in a change in control over the exercise price of the awards; or (3) cancelled if the price of an ordinary share paid in a change in control is less than the exercise price of the award. The board of directors will also be able to provide for accelerated vesting or lapse of restrictions of an award at any time.
Stockholder Rights
Except as otherwise provided in the applicable award agreement, and with respect to an award of restricted stock, a participant will have no rights as a stockholder with respect to ordinary shares covered by any award until the participant becomes the record holder of such shares.
Amendment and Termination
Notwithstanding any other provision of the 2014 Incentive Plan, our board of directors will be able to, at any time, amend any or all of the provisions of the 2014 Incentive Plan, or suspend or terminate it entirely,
 
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retroactively or otherwise, subject to stockholder approval in certain instances; provided, however, that, unless otherwise required by law or specifically provided in the 2014 Incentive Plan, the rights of a participant with respect to awards granted prior to such amendment, suspension or termination may not be adversely affected without the consent of such participant.
Transferability
Awards granted under the 2014 Incentive Plan generally will be non-transferable, other than by will or the laws of descent and distribution, except that the board of directors will be able to provide for the transferability of non-qualified stock options at the time of grant or thereafter to certain family members.
Recoupment of Awards
The 2014 Incentive Plan will provide that awards granted under the 2014 Incentive Plan are subject to any recoupment policy that we may have in place or any obligation that we may have regarding the clawback of “incentive-based compensation” under the Exchange Act or under any applicable rules and regulations promulgated by the SEC.
Effective Date; Term
The 2014 Incentive Plan will be effective on the date that it is adopted by the board of directors. No award will be granted under the 2014 Incentive Plan on or after the tenth anniversary of such date. However, any award outstanding under the 2014 Incentive Plan at the time of termination will remain in effect until such award is exercised or has expired in accordance with its terms.
Grants in Connection with the Offering
In connection with the consummation of the offering and based on the midpoint of the price range set forth on the cover page of this prospectus, as part of the 2014 Incentive Plan, we expect to grant to members of our senior management approximately 701,192 restricted stock units that will vest, if at all, based on performance-based metrics (the “PRSUs”), and approximately 202,439 restricted stock units that will vest, if at all, based exclusively on time-based metrics (the “TRSUs”).
The PRSUs will cliff vest on the third anniversary of the grant date (the “PRSU Vesting Date”), if at all, based on the achievement of certain performance metrics set forth herein and generally subject to the participant’s continued employment and based on the following. A maximum of 50% of such PRSUs will vest upon achievement of 22% (or greater) per year compound growth in total shareholder return (“TSR”), as measured from the grant date through the PRSU Vesting Date (the “TSR Tranche”). A 25% portion of such TSR Tranche (i.e., 12.5% of the PRSUs) shall vest upon the achievement of 10% TSR upon the PRSU Vesting Date, with straightline interpolation vesting between 10% and 22% TSR, and no vesting of the TSR Tranche for performance below 10% TSR. In addition, a maximum of 50% of the PRSUs will vest upon achievement of a 13.5% (or greater) per year compound growth in organic constant currency Adjusted EBITDA, as measured from the grant date through the PRSU Vesting Date (the “EBITDA Tranche”). A 25% portion of such EBITDA Tranche (i.e., 12.5% of the PRSUs) shall vest upon the achievement of 8% TSR upon the PRSU Vesting Date, with straightline interpolation vesting between 8% and 13% Adjusted EBITDA, and no vesting of the EBITDA Tranche for performance below 8% Adjusted EBITDA.
The TRSUs will vest in equal pro rata portions on each of the first and second anniversaries of the grant date, subject to the continued employment of the relevant participant through the vesting date. Pro rata vesting will be permitted for each of the PRSUs and the TRSUs for participants whose employment is terminated (i) for death or disability, (ii) without cause, (iii) for retirement or (iv) in the Company’s discretion, certain additional terminations (terminations for any other reason not specified in (i) through (iv) shall result in immediate forfeiture of a participant’s unvested PRSUs or unvested TRSUs). PRSUs will be granted on an annual basis, while the TRSUs are intended to be one-time grants. Prior to their vesting date, the PRSUs and TRSUs will carry no voting rights and no rights to participate in any dividends.
 
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 PRINCIPAL AND SELLING SHAREHOLDERS
As of September 3, 2014, all of our outstanding ordinary shares are held by PikCo. The following table sets forth information as of September 3, 2014, after giving effect to the Reorganization Transaction and the share split, regarding the beneficial ownership of our ordinary shares (1) immediately prior to and (2) upon consummation of this offering.
Beneficial ownership for the purposes of the following tables is determined in accordance with the rules and regulations of the SEC. These rules generally provide that a person is the beneficial owner of securities if such person has or shares the power to vote or direct the voting thereof, or to dispose or direct the disposition thereof or has the right to acquire such powers within 60 days. Shares subject to options that are currently exercisable or exercisable within 60 days of September 3, 2014 are deemed to be outstanding and beneficially owned by the person holding the options. These shares, however, are not deemed outstanding for the purposes of computing the percentage ownership of any other person. Percentage of beneficial ownership of our ordinary shares is based on (i) ordinary shares outstanding as of September 3, 2014 and (ii) ordinary shares to be outstanding after the completion of this offering, assuming no exercise of the option to purchase additional ordinary shares. Except as disclosed in the footnotes to this table and subject to applicable community property laws, we believe that each shareholder identified in the table possesses sole voting and investment power over all ordinary shares shown as beneficially owned by the shareholder. Unless otherwise indicated in the table or footnotes below, the address for each beneficial owner is C/Quintanavides, n. 17-2 Planta, 28050 Las Tablas, Madrid, Spain.
As of September 3, 2014, we had no record holders of our securities in the United States.

 	  	Shares Beneficially Owned
Before this Offering	 	 	Shares Beneficially Owned
After this Offering if the
underwriters’ option is not
exercised	 	 	Shares Beneficially Owned
After this Offering if the
underwriters’ option is
exercised in full	 	
Name	  	Number of
Shares	 	 	Percentage	 	 	Number of
Shares	 	 	Percentage	 	 	Number of
Shares	 	 	Percentage	 	
Principal Shareholder:	  				 				 				 				 				 				
Atalaya PikCo S.C.A. (1) .	  	 	67,589,417	  	 	 	98.2	% 	 	 	57,013,975	  	 	 	78.3	% 	 	 	54,820,225	  	 	 	75.3	% 	
Executive Officers and Directors:	  				 				 				 				 				 				
Alejandro Reynal (9)	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Mauricio Montilha (9)	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Reyes Cerezo (9)	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Iñaki Cebollero (9)	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
John Robson (9)	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Michael Flodin (9)	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Mariano Castaños (9)	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Nelson Armbrust (9)	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Miguel Matey (9)	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Juan Enrique Gamé (9)	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
José María Pérez Melber (9)	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Bruce Dawson (9)	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Francisco Tosta Valim Filho (2) (9)	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Melissa Bethell (3)	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Aurelien Vasseur (4)	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Mark Nunnelly (5)	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Luis Javier Castro (6)	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Stuart Gent (7)	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Devin O’Reilly (8)	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
All executive officers and directors as a group (19 persons) (9)	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
 
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(1)	The address for Atalaya PikCo S.C.A. is Da Vinci building, 4 rue Lou Hemmer, L-1748 Luxembourg-Findel, Grand Duchy of Luxembourg.	
(2)	The address for Mr. Valim is avenue Giovanni Gronchi 4864, São Paulo SP, 05724-002.	
(3)	The address for Ms. Bethell is Devonshire House, Mayfair Place, London, W1J 8AJ, United Kingdom.	
(4)	The address for Mr. Vasseur is Da Vinci building, 4 rue Lou Hemmer, L-1748 Luxembourg-Findel, Grand Duchy of Luxembourg.	
(5)	The address for Mr. Nunnelly is c/o Bain Capital Partners, LLC, John Hancock Tower, 200 Clarendon Street, Boston, Massachusetts.	
(6)	The address for Mr. Castro is c/o Mesoamerica, Plaza Tempo, Lobby B, piso 4, San José, Costa Rica.	
(7)	The address for Mr. Gent is Devonshire House, Mayfair Place, London, W1J 8AJ, United Kingdom.	
(8)	The address for Mr. O’Reilly is Devonshire House, Mayfair Place, London, W1J 8AJ, United Kingdom.	
(9)	Separately, Atalaya Management Gibco holds 1,210,583 shares, or 1.8% of our total outstanding shares in Atento immediately prior to the completion of this offering. Upon completion of this offering, Atalaya Management Gibco will hold 1,210,583 shares, or 1.7% of our total shares outstanding. Certain members of our management have an indirect equity interest in these shares, including (percentages are of the outstanding shares of the Issuer held by Atalaya Management Gibco): Alejandro Reynal (25%), Mauricio Montilha (7%), Reyes Cerezo (6%), Iñaki Cebollero (6%), John Robson (3%), Michael Flodin (4%), Mariano Castaños (7%), Nelson Armbrust (11%), Miguel Matey (6%), Juan Enrique Gamé (5%), José María Pérez Melber (4%), Bruce Dawson (3%), and Francisco Tosta Valim Vilho (7%).	
Unless otherwise indicated in the table or footnotes below, the address for each beneficial owner is C/Quintanavides, n. 17-2 Planta, 28050 Las Tablas, Madrid, Spain.
 
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The following table sets forth information as of September 3, 2014, after giving effect to the Reorganization Transactions regarding the beneficial ownership of Topco ordinary shares by:
 
 	•	 	each person or group who is known by us to own beneficially more than 5% of Topco’s outstanding ordinary shares;	
 
 	•	 	each of our directors; and	
 
 	•	 	all of our executive officers and directors as a group.	
For further information regarding material transactions between us and certain of our shareholders, see “Certain Relationships and Related Party Transactions.”

 	 	A Shares	 	 	Series 1 PECs (1)	 	 	Series 2 PECs (1)	 	 	Series 3 PECs (1)	 	
Name	 	Number
of Shares	 	 	Percentage
of Class	 	 	Number
of Shares	 	 	Percentage
of Class	 	 	Number
of Shares	 	 	Percentage
of Class	 	 	Number
of Shares	 	 	Percentage
of Class	 	
Principal Shareholders:	 				 				 				 				 				 				 				 				
Bain Capital (2)	 	 	17,706,930	  	 	 	88.5	% 	 	 	5,093,984,270	  	 	 	87.5	% 	 	 	177,071	  	 	 	87.4	% 	 	 	10,730,223	  	 	 	88.4	% 	
Mesoamerica BPO Ltd	 	 	1,516,324	  	 	 	7.6	% 	 	 	436,270,454	  	 	 	7.5	% 	 	 	15,163	  	 	 	7.5	% 	 	 	918,877	  	 	 	7.6	% 	
Executive Officers and Directors (3) :	 				 				 				 				 				 				 				 				
Alejandro Reynal (11)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Mauricio Montilha (11)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Reyes Cerezo (11)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Iñaki Cebollero (11)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
John Robson (11)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Michael Flodin (11)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Mariano Castaños (11)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Nelson Armbrust (11)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Miguel Matey (11)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Juan Enrique Gamé (11)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
José María Pérez Melber (11)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Bruce Dawson (11)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Francisco Tosta Valim Filho (4)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Melissa Bethell (5)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Aurelian Vasseur (6)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Mark Nunnelly (7)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Luis Javier Castro (8)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Stuart Gent (9)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Devin O’Reilly (10)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
All executive officers and directors as a group (19 persons) (11)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
 
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*	Indicates less than one percent.	
(1)	Represents preferred equity certificates and equivalents issued by Topco.	
(2)	Represents 8,742,886 A shares held by Bain Capital Fund X, L.P., a Cayman Islands exempted limited partnership (“Bain Capital Fund X”), 136,780 A shares held by BCIP Associates IV, L.P., a Cayman Islands exempted limited partnership (“BCIP IV”), 37,540 A shares held by BCIP Trust Associates IV, L.P. a Cayman Islands exempted limited partnership (“BCIP Trust IV”), 18,240 A shares held by BCIP Associates IV-B, L.P., a Cayman Islands exempted limited partnership (“BCIP IV-B”), 4,580 A shares held by BCIP Trust Associates IV-B, L.P., a Cayman Islands exempted limited partnership (“BCIP Trust IV-B”) and 8,766,904 A shares held by Bain Capital Europe Fund III, L.P., a Cayman Islands exempted limited partnership (“Bain Europe Fund” and, collectively with Bain Capital Fund X, BCIP IV, BCIP Trust IV, BCIP IV-B and Bain Europe Fund, the “Bain Capital Entities”). Bain Capital Partners X, L.P., a Cayman Islands exempted limited partnership (“Bain Capital Partners X”) is the general partner of Bain Capital Fund X. Bain Capital Partners Europe III, L.P., a Cayman Islands exempted limited partnership (“Bain Capital Partners Europe”) is the general partner of Bain Europe Fund. Bain Capital Investors, LLC, a Delaware limited liability company (“BCI”) is the general partner of each of Bain Capital Partners X, Bain Capital Partners Europe, BCIP IV, BCIP Trust IV, BCIP IV-B and BCIP. As a result, BCI may be deemed to share beneficial ownership of the shares held by each of the Bain Capital Entities. The governance, investment strategy and decision-making process with respect to investments held by the Bain Capital Entities is directed by BCI’s Global Private Equity Board (“GPEB”), which is comprised of the following individuals: Steven Barnes, Joshua Bekenstein, John Connaughton, Paul Edgerley, Stephen Pagliuca, Michel Plantevin, Dwight Poler, Jonathan Zhu and Stephen Zide. By virtue of the relationships described in this footnote, GPEB may be deemed to exercise voting and dispositive power with respect to the shares held by the Bain Capital Entities. Each of the members of GPEB disclaims beneficial ownership of such shares to the extent attributed to such member solely by virtue of serving on GPEB. Each of the Bain Capital Entities has an address c/o Bain Capital Partners, LLC, John Hancock Tower, 200 Clarendon Street, Boston, Massachusetts 02116.	
(3)	Certain executive officers and directors own equity interests in Atalaya Management Luxco Investment SCA, an indirect shareholder of Topco, and the PEC and A Share ownership shown is equivalent ownership based on their investment in Atalaya Management Luxco Investment SCA.	
(4)	The address for Mr. Valim is avenue Giovanni Gronchi 4864, São Paulo SP, 05724-002.	
(5)	Does not include shares held by the Bain Capital Entities. Ms. Bethell is a managing director of Bain Capital and as a result may be deemed to share beneficial ownership of the shares held by the Bain Capital Entities. The address for Ms. Bethell is Devonshire House, Mayfair Place, London, W1J 8AJ, United Kingdom.	
(6)	Does not include shares held by the Bain Capital Entities. Mr. Vasseur is a corporate manager of Bain Capital and as a result may be deemed to share beneficial ownership of the shares held by the Bain Capital Entities. The address for Mr. Vasseur is Da Vinci building, 4 rue Lou Hemmer, L-1748 Luxembourg-Findel, Grand Duchy of Luxembourg.	
(7)	The address for Mr. Nunnelly is c/o Bain Capital Partners, LLC, John Hancock Tower, 200 Clarendon Street, Boston, Massachusetts.	
(8)	Does not include shares held by Mesoamerica. Mr. Castro is a managing director of Mesoamerica and as a result may be deemed to share in beneficial ownership of the shares held by Mesoamerica. The address for Mr. Castro is c/o Mesoamerica, Plaza Tempo, Lobby B, piso 4, San José, Costa Rica.	
(9)	Does not include shares held by the Bain Capital Entities. Mr. Gent is a managing director of Bain Capital and as a result may be deemed to share in beneficial ownership of the shares held by the Bain Capital Entities. The address for Mr. Gent is Devonshire House, Mayfair Place, London, W1J8AJ, United Kingdom.	
(10)	Does not include shares held by the Bain Capital Entities. Mr. O’Reilly is a managing director of Bain Capital and as a result may be deemed to share beneficial ownership of the shares held by the Bain Capital Entities. The address for Mr. O’Reilly is Devonshire House, Mayfair Place, London, W1J 8AJ, United Kingdom.	
(11)	Atalaya Management Gibco holds certain Series 1 PECs, Series 2 PECs and Series 3 PECs which will be redeemed in full in connection with this offering which will result in net cash proceeds of approximately $1.3 million. The maximum cash proceeds to any eligible individual will be approximately $0.3 million. Separately, Atalaya Management Gibco also holds 481,590 C shares in Topco. Certain members of our management have an indirect equity interest in these shares including (percentages are of the C shares in Topco held by Atalaya Management Gibco): Alejandro Reynal (29%), Mauricio Montilha (9%), Reyes Cerezo (4%), Iñaki Cebollero (4%), John Robson (6%), Michael Flodin (4%), Mariano Castaños (6%), Nelson Armbrust (9%), Miguel Matey (6%), Juan Enrique Gamé (6%), José María Pérez Melber (6%), and Bruce Dawson (4%).	
 
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 CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
Bain Capital Consulting Services Agreement and Transaction Services Agreement
On December 12, 2012, Atento Spain Holdco, S.L.U., an indirect subsidiary of the Company, entered into a consulting services agreement with Bain Capital Partners, LLC, an investment adviser to certain of the Bain Capital funds, pursuant to which it agreed to provide general executive, business development and other financial advisory services to us. Pursuant to the consulting services agreement, Bain Capital Partners, LLC receives an annual fee equal to the greater of €5.0 million and 3.00% of the Company’s annual EBITDA, plus reimbursement for reasonable out-of-pocket expenses.
Additionally, pursuant to a transaction services agreement between Atento Spain Holdco S.L.U. and Bain Capital Partners, LLC, dated as of December 12, 2012, it provides certain transaction-specific advisory services. Pursuant to this agreement, Atento Spain Holdco, S.L.U. paid Bain Capital Partners, LLC a transaction fee of $20.3 million in December 2012 principally related to the Acquisition, and it has agreed to pay transaction fees for advice and support relating to future transactions by us (including, without limitation, any share, asset or debt purchase, capital expenditures and refinancing of existing indebtedness) equal to 1.00% of the aggregate transaction value of each such future transaction plus any reasonable out-of-pocket expenses (including fees of any accountants, attorneys or other advisors retained by Bain Capital Partners, LLC and its affiliates) incurred in connection with the investigation, negotiation and consummation of such future transaction.
Our payment of fees to Bain Capital Partners, LLC in 2013 in connection with these agreements amounted to $12.1 million.
The transaction services agreement and consulting services agreements each have a one-year initial term and are thereafter subject to automatic one-year extensions unless Bain Capital Partners, LLC provides written notice of termination at least 90 days prior to the expiration of the initial term or any extension thereof. Bain Capital Partners, LLC may also terminate the agreements at any time by delivering to us written notice of termination. The agreements include customary indemnities in favor of Bain Capital Partners, LLC. The transaction services agreement and the consulting services agreement were amended on May 17, 2013.
We expect the transaction services agreement and consulting services agreement to terminate in connection with this offering. In connection with such termination, we will pay to Bain Capital Partners, LLC a termination fee of $23.0 million.
Subscription and Securityholder’s Agreements
Topco, our indirect parent company, Atalaya Luxco S.à r.l. and certain investors, including Bain Capital and certain members of our management team, entered into certain Subscription and Securityholder’s Agreements. The Subscription and Securityholder’s Agreements provide for each investor therein to subscribe for certain securities of Topco or its affiliates, and sets forth rights and restrictions related to the securities. Among other things, the Subscription and Securityholder’s Agreements restrict the transfer of the securities by investors, other than Bain Capital, without the prior written consent of Atalaya Luxco S.à r.l. The Subscription and Securityholder’s Agreements further provide the investors with tag along rights in the event Bain Capital transfers any of its securities. The Subscription and Securityholder’s Agreements also provide Bain Capital with a drag along right that can be imposed upon the investors in the event Bain Capital proposes to transfer its securities.
In addition, the Subscription and Securityholder’s Agreements require the investors to vote for and consent to a public offering and sale of the securities approved by Atalaya Luxco S.à r.l.
 
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Registration Rights Agreement
Prior to the consummation of this offering, we intend to enter into a registration rights agreement whereby we will grant certain registration rights to PikCo, and its affiliates and certain of their transferees, including the right, under certain circumstances and subject to certain restrictions, to require us to register under the Securities Act our ordinary shares held by them. In addition, we will commit to file as promptly as possible after receiving a request from PikCo, a shelf registration statement registering secondary sales of our ordinary shares held by PikCo. PikCo also will have the ability to exercise certain piggyback registration rights in respect of ordinary shares held by them in connection with registered offerings requested by other registration rights holders or initiated by us.
2014 Incentive Plan
In connection with this offering, we intend to adopt the 2014 Omnibus Incentive Plan (the “2014 Incentive Plan”). The 2014 Incentive Plan will provide for grants of stock options, stock appreciation rights, restricted stock, other stock-based awards and other cash-based awards. Directors, officers and other employees of us and our subsidiaries, as well as others performing consulting or advisory services for us, will be eligible for grants under the 2014 Incentive Plan. The purpose of the 2014 Incentive Plan is to provide incentives that will attract, retain and motivate high performing officers, directors, employees and consultants by providing them with appropriate incentives and rewards either through a proprietary interest in our long-term success or compensation based on their performance in fulfilling their personal responsibilities.
Management Loan
On July 18, 2013, Atento Spain Holdco 2, S.A.U., an indirect subsidiary, entered into a revolving facility agreement with Atalaya Management Luxco Investment pursuant to which Atento Spain Holdco 2, S.A.U. provided a Euro revolving loan facility in an aggregate amount equal to €3.0 million ($4.1 million) to Atalaya Management Luxco Investment for the purpose of acquiring an interest in Topco. As of December 31, 2013, the management loan had an outstanding balance of $2.4 million. The loan was converted in April 2014 into a preference share, held by Atento Spain Holdco 2, S.A.U. This preference share was redeemed in full in May 2014, the redemption price was funded by the issuance of a series of preferred equity certificates by Atalaya Management Luxco Investment to certain entities controlled by Bain Capital. It is intended that the IPO proceeds that are received by the selling shareholder will be used to redeem a portion of these preferred equity certificates.
Consulting Services and Information Rights Agreement
In connection with this offering, we intend to enter into a Consulting Services and Information Rights Agreement (the “Consulting Agreement”) with Bain Capital as consultants (the “Consultants”). Among other things, the Consulting Agreement provides for the Consultants to perform certain consulting services for the benefit of the Company, including business development services, financing-related services and marketing, operations and human resources services, among others. The Consultants are entitled to reimbursement of all reasonable out-of-pocket expenses incurred by them in connection with the Consulting Agreement, including irrecoverable VAT thereon. In addition, the Consultants shall be entitled to receive from the Company such financial information regarding the Company and its affiliates as the Consultants may reasonably request, including monthly management reports and annual budgets. The Consulting Agreement includes customary indemnification provisions in favor of the Consultants and has an initial term of three years, subject to automatic annual extensions unless the parties mutually agree otherwise.
 
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PIK Notes due 2020
On May 30, 2014, PikCo, our parent company, issued €137.5 million and $191.5 million aggregate principal amount of PIK Notes pursuant to an indenture, dated May 30, 2014, among PikCo, as issuer, Topco, the direct holding company of PikCo, as security provider, Citibank, N.A., London Branch, as trustee, security agent and paying agent, and Citigroup Global Markets Deutschland AG, as registrar, governing the Senior PIK Toggle Notes. The PIK Notes are senior secured obligations of PikCo and are not guaranteed by any party.
The PIK Notes will mature on May 30, 2020. PikCo may decide in its sole discretion to pay all or a portion of the interest payable for any interest period in cash or in kind.
The indenture governing the Senior PIK Toggle Notes contains covenants that, among other things, restrict the ability of PikCo and certain of its subsidiaries, including us, to: incur or guarantee additional indebtedness; issue, redeem or repurchase certain debt; issue certain preferred stock or similar equity securities; make loans and investments; sell assets; incur liens; enter into transactions with affiliates; enter into agreements restricting certain subsidiaries’ ability to pay dividends; and consolidate, merge or sell all or substantially all of its assets. These covenants are subject to a number of important exceptions and qualifications. In addition, in certain circumstances, if PikCo sells assets (including a sale of capital stock to third parties pursuant to a public equity offering or otherwise), or experiences certain changes of control, it must offer to purchase all or a portion of the Senior PIK Toggle Notes at a price equal to par plus a premium.
Limitations of Liability and Indemnification Matters
We intend to enter into indemnification agreements with each of our current directors and executive officers. These agreements will require us to indemnify these individuals to the fullest extent permitted under Luxembourg law against liabilities that may arise by reason of their service to us, and to advance expenses incurred as a result of any proceeding against them as to which they could be indemnified. We also intend to enter into indemnification agreements with our future directors and executive officers.
Policies and Procedures With Respect to Related Party Transactions
Upon the closing of this offering, we intend to adopt policies and procedures whereby our Audit Committee will be responsible for reviewing and approving related party transactions. In addition, our Code of Ethics will require that all of our employees and directors inform the Company of any material transaction or relationship that comes to their attention that could reasonably be expected to create a conflict of interest. Further, at least annually, each director and executive officer will complete a detailed questionnaire that asks questions about any business relationship that may give rise to a conflict of interest and all transactions in which we are involved and in which the executive officer, a director or a related person has a direct or indirect material interest.
 
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 DESCRIPTION OF SHARE CAPITAL
The following is a summary of some of the terms of our ordinary shares, based on our articles of association as they will become effective upon their amendment prior to the completion of this offering and the Luxembourg Corporate Law. In this section and the section entitled “Comparison of Shareholder Rights” we refer to our articles of association as amended and in effect upon the completion of this offering as our “articles of association.”
The following summary is subject to, and is qualified in its entirety by reference to, the provisions of our articles of association, the form of which has been filed as an exhibit to the registration statement of which this prospectus is a part. You may obtain copies of our articles of association as described under “Where You Can Find More Information” in this prospectus.
General
The Issuer is a Luxembourg public limited liability company ( société anonyme ). The company’s legal name is “Atento S.A.” The Issuer was incorporated on March 5, 2014 as a Luxembourg public limited liability company ( société anonyme ).
The Issuer is registered with the Luxembourg Registry of Trade and Companies under number B.185.761. The Issuer has its registered office at 4 rue Hemmer, L-1748 Luxembourg Findel, Grand Duchy of Luxembourg.
The corporate purpose of the Issuer, as stated in Article 2 of our articles of association (Purpose), may be summarized as follows: The object of the Issuer, is the holding of participations, in any form whatsoever, in Luxembourg and foreign companies and in any other form of investment, the acquisition by purchase, subscription, or in any other manner as well as the transfer by sale, exchange or otherwise of securities of any kind and the administration, management, control and development of its portfolio.
The Issuer may further guarantee, grant security, grant loans or otherwise assist the companies in which it holds a direct or indirect participation or right of any kind or which form part of the same group of companies as the Issuer.
The Issuer may raise funds especially through borrowing in any form or by issuing any kind of notes, securities or debt instruments, bonds and debentures and generally issue securities of any type.
Finally, the Issuer, may carry out any commercial, industrial, financial, real estate or intellectual property activities which it considers useful for the accomplishment of these purposes.
Share Capital
As of June 30, 2014, our issued share capital amounts to €31,000, represented by 31,000 shares with a nominal value of €1.00 per share. All issued shares were fully paid. A shareholder in a Luxembourg société anonyme holding fully paid shares is not liable, solely because of his or her or its shareholder status, for additional payments to the Company or the Company’s creditors.
Upon completion of this offering, our issued share capital will be represented by ordinary shares with no nominal value. All issued shares will be fully paid and subscribed for.
Prior to the completion of this offering, we will have an authorized share capital of €1,000,000,000. Immediately after completion of this offering, the authorized share capital will be €999,998,175.23.
 
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Our articles of association will authorize our board of directors to issue ordinary shares within the limits of the authorized share capital at such times and on such terms as our board or its delegates may decide for a period commencing on the date of our articles of association and ending five years after the date on which the minutes of the shareholders’ meeting approving such authorization are published in the Luxembourg official gazette Mémorial C, Recueil des Sociétés et Associations (unless such period is extended, amended or renewed). Accordingly, our board will be authorized to issue ordinary shares up to the authorized share capital until such date. We currently intend to seek renewals and/or extensions as required from time to time.
Our authorized share capital will be determined by our articles of association, as amended from time to time, and may be increased, reduced or extended by amending the articles of association by approval of the extraordinary general shareholders’ meeting subject to the necessary quorum and majority requirements (see “—General Meeting of Shareholders” and “—Amendment to the Articles of Association”).
Under Luxembourg law, existing shareholders benefit from a pre-emptive subscription right on the issuance of shares for cash consideration. However, our shareholders will have, in accordance with Luxembourg law, authorized the board of directors to suppress, waive or limit any pre-emptive subscription rights of shareholders provided by law to the extent the board deems such suppression, waiver or limitation advisable for any issuance or issuances of shares within the scope of our authorized share capital. Such shares may be issued above, at or below market value but in any event not below the accounting par value per ordinary share as well as by way of incorporation of available reserves (including premium).
The board of directors will resolve on such shares issuance out of the authorized share capital ( capital autorisé ) in accordance with the quorum and voting thresholds set forth in the articles of association of the Company to be amended before completion of this offering. The board of directors will also resolve on the applicable procedures and timelines to which it will, or has to, subject such issuance. If the proposal of the board of directors to issue new shares exceeds the limits of our authorized share capital, the board of directors must then convene the shareholders to an extraordinary general meeting to be held in the presence of a Luxembourg notary for the purpose of increasing the issued share capital accordingly. Such meeting will be subject to the quorum and majority requirements provided for the amendment of articles. If the capital call proposed by the board of directors consists in an increase in the shareholders’ commitments, the board of directors must then convene the shareholders to an extraordinary general meeting to be held in the presence of a Luxembourg notary for such purpose. Such meeting will be subject to the unanimous consent of the shareholders.
Form and Transfer of Shares
Our ordinary shares are issued in registered form only and are freely transferable under Luxembourg law and our articles of association. Our board of directors may however impose transfer restrictions for shares that are registered, listed, quoted, dealt in, or that have been placed in certain jurisdictions in compliance with the requirements applicable therein. Luxembourg law does not impose any limitations on the rights of Luxembourg or non-Luxembourg residents to hold or vote our ordinary shares.
Under Luxembourg law, the ownership of registered shares is prima facie established by the inscription of the name of the shareholder and the number of shares held by him or her in the shareholders register.
Without prejudice to the conditions for transfer by book entry where shares are recorded in the shareholder register on behalf of one or more persons in the name of a depository, each transfer of shares shall be effected by written declaration of transfer to be recorded in the shareholder register, such declaration to be dated and signed by the transferor and the transferee or by their duly appointed agents. We may accept and enter into the shareholder register any transfer effected pursuant to an agreement or agreements between the transferor and the transferee, true and complete copies of which have been delivered to us.
 
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Our articles of association will provide that we may appoint registrars in different jurisdictions, each of whom may maintain a separate register for the shares entered in such register and the holders of shares shall be entered into one of the registers. Shareholders may elect to be entered into one of these registers and to transfer their shares to another register so maintained. Entries in these registers will be reflected in the shareholders’ register maintained at our registered office.
In addition, our articles of association will also provide that our ordinary shares may be held through a securities settlement system or a professional depository of securities. Ordinary shares held in such manner will have the same rights and obligations as ordinary shares recorded in our shareholders’ register. Furthermore, ordinary shares held through a securities settlement system or a professional depository of securities may be transferred in accordance with customary procedures for the transfer of securities in book-entry form.
Issuance of Shares
Pursuant to the Luxembourg Corporate Law, the issuance of ordinary shares requires the approval by the general meeting of shareholders at the quorum and majority provided for the amendment of articles (see “—General Meeting of Shareholders” and “—Amendment to the Articles of Association”). The general meeting may approve an authorized share capital and authorize the board of directors to issue ordinary shares up to the maximum amount of such authorized share capital for a maximum period of five years as from the date of publication in the Luxembourg official gazette ( Mémorial, Recueil des Sociétés et Associations ) of the minutes of the relevant general meeting. The general meeting may amend, renew or extend such authorized share capital and such authorization to the board of directors to issue shares.
Prior to the completion of this offering, we will have an authorized share capital of €1,000,000,000. Immediately after completion of this offering, the authorized share capital will be €999,998,175.23. See “—Share Capital.”
Our articles of association provide that no fractional shares shall be issued.
Our ordinary shares have no conversion rights and there are no redemption or sinking fund provisions applicable to our ordinary shares.
Pre-Emptive Rights
Unless limited, waived or cancelled by our board of directors (see “—Share Capital”), holders of our ordinary shares have a pro rata pre-emptive right to subscribe for any new shares issued for cash consideration. Our articles of association will provide that pre-emptive rights can be limited, waived or cancelled by our board of directors for a period ending on the fifth anniversary of the date of publication of the notarial deed recording the minutes of the extraordinary general shareholders’ meeting in the Luxembourg Legal Gazette in the event of an increase of the share capital by the board of directors within the limits of the authorized share capital, which publication is expected to occur prior to completion of this offering. The general meeting of shareholders duly convened to consider an amendment to the articles of association may by majority vote also limit, waive or cancel such pre-emptive rights or to renew, amend or extend them, each time for a period not to exceed five years.
Repurchase of Shares
We cannot subscribe for our own ordinary shares.
We may, however, repurchase issued ordinary shares or have another person repurchase issued ordinary shares for our account, subject to the following conditions:
 
 	•	 	prior authorization by a simple majority vote at an ordinary general meeting of shareholders, which authorization sets forth the terms and conditions of the proposed repurchase and in particular the	
 
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 	maximum number of ordinary shares to be repurchased, the duration of the period for which the authorization is given (which may not exceed five years) and, in the case of repurchase for consideration, the minimum and maximum consideration per share;	
 
 	•	 	the repurchase may not reduce our net assets on a non-consolidated basis to a level below the aggregate of the issued and subscribed share capital and the reserves that we must maintain pursuant to Luxembourg law or our articles of association; and	
 
 	•	 	only fully paid-up shares may be repurchased.	
Prior to the completion of this offering, the general meeting of shareholders will authorize the board of directors to repurchase shares representing up to 20% of the issued share capital immediately after the closing of this offering. The authorization will be valid for a period ending on the earlier of five years from the date of such shareholder authorization and the date of its renewal by a subsequent general meeting of shareholders. Pursuant to such authorization, the board of directors is authorized to acquire and sell ordinary shares in the Company under the conditions set forth in Article 49-2 of the Luxembourg Corporate Law. Such purchases and sales may be carried out for any authorized purpose or any purpose that is authorized by the laws and regulations in force. The purchase price per ordinary share to be paid shall represent (i) not less than 50% of the lowest closing price per share and (ii) not more than 50% above the highest closing price per share, in each case as reported by the New York City edition of the Wall Street Journal, or, if not reported therein, any other authoritative sources to be selected by the board of directors, over the ten trading days preceding the date of the purchase (or the date of the commitment to the transaction).
In addition, pursuant to Luxembourg law, the Issuer, may directly or indirectly repurchase ordinary shares by decision of our board of directors without the prior approval of the general meeting of shareholders if such repurchase is deemed by the board of directors to be necessary to prevent serious and imminent harm to us or if the acquisition of shares has been made in view of the distribution thereof to employees.
Capital Reduction
Our articles of association provide that our issued share capital may be reduced, subject to the approval by the general meeting of shareholders at the quorum and majority provided for the amendment of the articles of association (see “—Voting Rights—Extraordinary Resolutions” and “—Amendment to the Articles of Association”).
General Meeting of Shareholders
Any regularly constituted general meeting of shareholders of the Issuer represents the entire body of shareholders of the Issuer.
Each of our ordinary shares entitles the holder thereof to attend our general meeting of shareholders, either in person or by proxy, to address the general meeting of shareholders and to exercise voting rights, subject to the provisions of our articles of association. Each ordinary share entitles the holder to one vote at a general meeting of shareholders. Our articles of association will provide that our board of directors shall adopt all other regulations and rules concerning the attendance to the general meeting, availability of access cards and proxy forms in order to enable shareholders to exercise their right to vote as it deems fit.
When convening a general meeting of shareholders, we will publish two notices (which must be published at least eight days apart and, in the case of the second notice, at least eight days before the meeting) in the Luxembourg official gazette Mémorial C, Recueil des Sociétés et Associations , and in a Luxembourg newspaper.
Our articles of association will provide that if our shares are listed on a regulated market, the general meeting will also be convened in accordance with the publicity requirements of such regulated market applicable to us.
 
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A shareholder may participate in general meetings of shareholders by appointing another person as his proxy, the appointment of which shall be in writing. Our articles of association will also provide that, in the case of shares held through the operator of a securities settlement system or depository, a holder of such shares wishing to attend a general meeting of shareholders should receive from such operator or depository a certificate certifying the number of shares recorded in the relevant account on the record date. Such certificates as well as any proxy forms should be submitted to us no later than three (3) business days before the date of the general meeting unless our board of directors fixes a different period.
The annual ordinary general meeting of shareholders of the Issuer, is held at 10:00 a.m. (Central European Time) on the 31st of May of each year at the registered office of the Company or in any other place in Luxembourg as notified to the shareholders. If that day is a legal or banking holiday in Luxembourg, the meeting will be held on the next following business day.
Luxembourg law provides that the board of directors is obliged to convene a general meeting of shareholders if shareholders representing, in the aggregate, 10% of the issued share capital so request in writing with an indication of the meeting agenda. In such case, the general meeting of shareholders must be held within one month of the request. If the requested general meeting of shareholders is not held within one month, shareholders representing, in the aggregate, 10% of the issued share capital may petition the competent president of the district court in Luxembourg to have a court appointee convene the meeting. Luxembourg law provides that shareholders representing, in the aggregate, 10% of the issued share capital may request that additional items be added to the agenda of a general meeting of shareholders. That request must be made by registered mail sent to the registered office of the Company at least five days before the general meeting of shareholders.
Voting Rights
Each share entitles the holder thereof to one vote at a general meeting of shareholders. Luxembourg law distinguishes general meetings of shareholders and extraordinary general meetings of shareholders.
Extraordinary general meetings of shareholders relate to proposed amendments to the articles of association and certain other limited matters.
Ordinary General Meeting
At an ordinary general meeting there is no quorum requirement and resolutions are adopted by a simple majority of votes validly cast on such resolution is sufficient. Abstentions are not considered “votes.”
Extraordinary General Meeting
Extraordinary resolutions are required for any of the following matters, among others: (a) an increase or decrease of the authorized or issued capital, (b) a limitation or exclusion of preemptive rights, (c) approval of a statutory merger or de-merger ( scission ), (d) dissolution and liquidation of the Issuer, and (e) any and all amendments to our articles of association. Pursuant to our articles of association, for any resolutions to be considered at an extraordinary general meeting of shareholders the quorum shall be at least one half (50%) of the issued share capital of the Company unless otherwise mandatorily required by law. If the said quorum is not present, a second meeting may be convened at which Luxembourg Corporate Law does not prescribe a quorum. Any extraordinary resolution shall be adopted at a quorate general meeting (save as otherwise provided by mandatory law) by at least a two thirds (2/3) majority of the votes validly cast on such resolution. Abstentions are not considered “votes.”
 
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Appointment and Removal of Directors
Members of our board of directors may be elected by simple majority of the votes cast at a general meeting of shareholders. Our articles of association will provide that the directors shall be elected on a staggered basis, with one third (1/3) of the directors being elected each year, and each director elected for a period of three year. Any director may be removed with or without cause by resolution at a general meeting of shareholders adopted by a simple majority of votes validly cast at the meeting.
Our articles of association provide that in case of a vacancy the board of directors may fill such vacancy. The directors shall be eligible for re-election indefinitely.
Neither Luxembourg law nor our articles of association contain any restrictions as to the voting of our shares by non-Luxembourg residents.
Amendment to the Articles of Association
Shareholder Approval Requirements
Luxembourg law requires an extraordinary general meeting of shareholders to resolve upon an amendment of the articles of association to be made by extraordinary resolution. The agenda of the extraordinary general meeting of shareholders must indicate the proposed amendments to the articles of association. An extraordinary general meeting of shareholders convened for the purposes of amending the articles of association must have a quorum of at least 50% of our issued share capital. If the said quorum is not present, a second meeting may be convened at which Luxembourg Corporate Law does not prescribe a quorum. Irrespective of whether the proposed amendments will be subject to a vote at any duly convened extraordinary general shareholders’ meeting, the amendment is subject to the approval of at least two-thirds (2/3) of the votes cast at such extraordinary general meeting of shareholders.
Formalities
Any resolutions to amend our articles of association must be taken before a Luxembourg notary and such amendments must be published in accordance with Luxembourg law.
Merger and De-Merger
A merger by absorption whereby one Luxembourg company after its dissolution without liquidation transfers to another company all of its assets and liabilities in exchange for the issuance of shares in the acquiring company to the shareholders of the company being acquired, or a merger effected by transfer of assets to a newly incorporated company, must, in principle, be approved at a general meeting by an extraordinary resolution of the Luxembourg company, and the general meeting must be held before a notary. Similarly a de-merger of a Luxembourg company is generally subject to the approval by an extraordinary general meeting of shareholders.
Dissolution and Liquidation
In the event of our dissolution, liquidation, or winding-up of the Company the assets remaining after allowing for the payment of all liabilities of the Company will be paid out to the shareholders pro rata according to their respective shareholdings. The decisions to dissolve, liquidate, or wind-up require the approval by an extraordinary general meeting of shareholders of the Company to be held before a notary.
 
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No Appraisal Rights
Neither Luxembourg law nor our articles of association provide for any appraisal rights of dissenting shareholders.
Dividend Distributions
Subject to Luxembourg law, if and when a dividend distribution is declared by the general meeting of shareholders or the board of directors in the case of interim dividend distributions, each ordinary share is entitled to participate equally in such distribution of funds legally available for such purposes. Pursuant to our articles of association, the general meeting of shareholders may approve a dividend distribution and the board of directors may declare an interim dividend distribution, to the extent permitted by Luxembourg law.
Declared and unpaid dividend distributions held by us for the account of the shareholders shall not bear interest. Under Luxembourg law, claims for unpaid dividend distributions will lapse in our favor five years after the date such dividend distribution was declared.
Annual Accounts
Under Luxembourg law, the board of directors must prepare each year annual accounts, i.e., an inventory of the assets and liabilities of the Issuer together with a balance sheet and a profit and loss account each year. Our board of directors must also annually prepare consolidated accounts and management reports on the annual accounts and consolidated accounts. The annual accounts, the consolidated accounts, the management report and the auditor’s reports must be available for inspection by shareholders at our registered office at least 15 calendar days prior to the date of the annual ordinary general meeting of shareholders.
The annual accounts and the consolidated accounts, after approval by the annual ordinary general meeting of shareholders, will need to be filed with the Luxembourg Registry of Trade and Companies within seven months of the close of the financial year.
Information Rights
Luxembourg law gives shareholders limited rights to inspect certain corporate records 15 calendar days prior to the date of the annual ordinary general meeting of shareholders, including the annual accounts with the list of directors and auditors, the consolidated accounts, the notes to the annual accounts and the consolidated accounts, a list of shareholders whose shares are not fully paid-up, the management reports and the auditor’s report.
The annual accounts, the consolidated accounts, the auditor’s report and the management report are sent to registered shareholders at the same time as the convening notice for the annual general meeting. In addition, any registered shareholder is entitled to receive a copy of such documents free of charge prior to the date of the annual ordinary general meeting of shareholders.
Under Luxembourg law, it is generally accepted that a shareholder has the right to receive responses at the shareholders’ general meeting to questions concerning items on the agenda of that general meeting of shareholders, if such responses are necessary or useful for a shareholder to make an informed decision concerning such agenda item, unless a response to such questions could be detrimental to our interests.
Board of Directors
The management of the Issuer is vested in a board of directors. Our articles of association will provide that the board must comprise at least three members.
The board meets as often as Company interests require.
 
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A majority of the members of the board present or represented at a board meeting constitutes a quorum, and resolutions are adopted by the simple majority vote of the board members present or represented. The board may also take decisions by means of resolutions in writing signed by all directors. Each director has one vote.
The general shareholders’ meeting elects directors and decides their respective terms. Under Luxembourg law, directors may be re-elected but the term of their office may not exceed 6 years. Our articles of association will provide that the directors shall be elected on a staggered basis, with one third (1/3) of the directors being elected each year. The general shareholders’ meeting may dismiss one or more directors at any time, with or without cause by a simple majority of votes cast at a general meeting of shareholders. If the board has a vacancy, the remaining directors have the right to fill such vacancy on a temporary basis pursuant to the affirmative vote of a majority of the remaining directors. The term of a temporary director elected to fill a vacancy expires at the end of the term of office of the replaced director, provided, however, that the next general shareholders’ meeting shall be requested definitively to elect any temporary director.
Within the limits provided for by law, our board may delegate to one or more persons the daily management of the Company and the authority to represent the Company.
No director shall, solely as a result of being a director, be prevented from contracting with us, either with regard to his tenure in any office or place of profit or as vendor, purchaser or in any other manner whatsoever, nor shall any contract in which any director is in any way interested be liable to be voided merely on account of his position as director, nor shall any director who is so interested be liable to account to us or the shareholders for any remuneration, profit or other benefit realized by the contract by reason of the director holding that office or of the fiduciary relationship thereby established.
Any director having an interest in a transaction submitted for approval to the board may not participate in the deliberations and vote thereon, unless the transaction is not in the ordinary course of the Company’s business and that conflicts with the Company’s interest, in which case the director shall be obliged to advise the board thereof and to cause a record of his statement to be included in the minutes of the meeting. He may not take part in these deliberations nor vote on such a transaction. At the next general meeting, before any other resolution is put to a vote, a special report shall be made on any transactions in which any of the directors may have had an interest that conflicts with our interest.
No shareholding qualification for directors is required.
Our articles of association will provide that directors and officers, past and present, are entitled to indemnification from us to the fullest extent permitted by Luxemburg law against liability and all expenses reasonably incurred or paid by him in connection with any claim, action, suit or proceeding in which he is involved by virtue of his being or having been a director or officer and against amounts paid or incurred by him in the settlement thereof. We may purchase and maintain insurance for any director or other officer against any such liability.
No indemnification will be provided against any liability to us or our shareholders (i) by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties of a director or officer; (ii) with respect to any matter as to which any director or officer shall have been finally adjudicated to have acted in bad faith and not in the interest of the Company; or (iii) in the event of a settlement, unless approved by a court or the board of directors.
Transfer Agent and Registrar
The transfer agent and registrar for our ordinary shares is American Stock Transfer & Trust Company, LLC. Its address is 6201 15 th Avenue, Brooklyn, New York 11219.
 
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 COMPARISON OF SHAREHOLDER RIGHTS
We are incorporated under the laws of Luxembourg. The following discussion summarizes material differences between the rights of holders of our ordinary shares and the rights of holders of the ordinary shares of a typical corporation incorporated under the laws of the state of Delaware, which result from differences in governing documents and the laws of Luxembourg and Delaware.

Delaware	  	Luxembourg	
Board of Directors
 	
A typical certificate of incorporation and bylaws would provide that the number of directors on the board of directors will be fixed from time to time by a vote of the majority of the authorized directors. Under Delaware law, a board of directors can be divided into classes and cumulative voting in the election of directors is only permitted if expressly authorized in a corporation’s certificate of incorporation.	  	Pursuant to the Luxembourg Corporate Law, the board of directors must be composed of at least three directors. They are appointed by the general meeting of shareholders (by proposal of the board, the shareholders or a spontaneous candidacy) by a simple majority of the votes cast. Directors may be re-elected but the term of their office may not exceed six years.
 
Pursuant to our articles of association directors are elected by a simple majority vote at a general meeting. Abstentions are not considered “votes.”
 
Our articles of association provide that in case of a vacancy, the remaining board members may elect a director to fill the vacancy. See “—Filling Vacancies on the Board of Directors.”
 
The articles of association may provide for different classes of directors. Our articles of association will provide for different classes of directors and each director has one vote.
 
Our articles of association provide that the board may set up committees and determine their composition, powers and rules.	
	
Limitation on Personal Liability of Directors
 	
A typical certificate of incorporation provides for the elimination of personal monetary liability of directors for breach of fiduciary duties as directors to the fullest extent permissible under the laws of Delaware, except for liability (i) for any breach of a director’s loyalty to the corporation or its shareholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the Delaware General Corporation Law (relating to the liability of directors for unlawful payment of a dividend or an unlawful stock purchase or	  	The Luxembourg Corporate Law provides that directors do not assume any personal obligations for commitments of the company. Directors are liable to the company for the performance of their duties as directors and for any misconduct in the management of the company’s affairs.
 
Directors are further jointly and severally liable both to the company and to any third parties for damages resulting from violations of the law or the articles of association of the company. Directors will only be	
 
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redemption) or (iv) for any transaction from which the director derived an improper personal benefit. A typical certificate of incorporation would also provide that if the Delaware General Corporation Law is amended so as to allow further elimination of, or limitations on, director liability, then the liability of directors will be eliminated or limited to the fullest extent permitted by the Delaware General Corporation Law as so amended.	  	discharged from such liability for violations to which they were not a party, provided no misconduct is attributable to them and they have reported such violations at the first general meeting after they had knowledge thereof.
 
In addition, directors may under specific circumstances also be subject to criminal liability, such as in the case of an abuse of assets.
 
Our articles of association will provide that directors and officers, past and present, are entitled to indemnification from the Company to the fullest extent permitted by Luxembourg law against liability and all expenses reasonably incurred or paid by him in connection with any claim, action, suit or proceeding in which he is involved by virtue of his being or having been a director or officer and against amounts paid or incurred by him in the settlement thereof, subject to certain exceptions. See “Indemnification of Officers, Directors and Employees.”	
	
Interested Shareholders
 	
Section 203 of the Delaware General Corporation Law generally prohibits a Delaware corporation from engaging in specified corporate transactions (such as mergers, stock and asset sales, and loans) with an “interested shareholder” for three years following the time that the shareholder becomes an interested shareholder. Subject to specified exceptions, an “interested shareholder” is a person or group that owns 15% or more of the corporation’s outstanding voting stock (including any rights to acquire stock pursuant to an option, warrant, agreement, arrangement or understanding, or upon the exercise of conversion or exchange rights, and stock with respect to which the person has voting rights only), or is an affiliate or associate of the corporation and was the owner of 15% or more of the voting stock at any time within the previous three years.	  	Under Luxembourg law no restriction exists as to the transactions that a shareholder may conclude with the company. The transaction must however be in the corporate interest of the company and be made on arm’s length terms.	
		
A Delaware corporation may elect to “opt out” of, and not be governed by, Section 203 of the Delaware General Corporation Law through a provision in either its original certificate of incorporation, or an amendment to its original certificate or bylaws that was approved by majority shareholder vote. With a limited exception, this amendment would not become effective until 12 months following its adoption.	  	Not applicable.	
 
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Removal of Directors
 	
A typical certificate of incorporation and bylaws provide that, subject to the rights of holders of any preferred shares, directors may be removed at any time by the affirmative vote of the holders of at least a majority, or in some instances a supermajority, of the voting power of all of the then outstanding shares entitled to vote generally in the election of directors, voting together as a single class. A certificate of incorporation could also provide that such a right is only exercisable when a director is being removed for cause (removal of a director only for cause is the default rule in the case of a classified board).	  	Pursuant to the Luxembourg Corporate Law, directors may be removed at any time with or without cause by ordinary resolution at a general meeting of shareholders adopted by a simple majority of the votes cast on such resolution.	
	
Filling Vacancies on the Board of Directors
 	
A typical certificate of incorporation and bylaws provide that, subject to the rights of the holders of any preferred shares, any vacancy, whether arising through death, resignation, retirement, disqualification, removal, an increase in the number of directors or any other reason, may be filled by a majority vote of the remaining directors, even if such directors remaining in office constitute less than a quorum, or by the sole remaining director. Any newly elected director usually holds office for the remainder of the full term expiring at the annual meeting of shareholders at which the term of the class of directors to which the newly elected director has been elected expires.	  	Luxembourg law provides that in the event of a vacancy of a director seat, the remaining directors may, unless the articles of association of the company provide otherwise, provisionally fill such vacancy until the next annual general meeting at which the shareholders will be asked to confirm the appointment.
 
The decision to fill a vacancy must be taken at a duly convened and quorate meeting of the board of directors.
 
Our articles of association provide that vacancies for removal or otherwise may be filled on a temporary basis pursuant to the affirmative vote of a majority of the remaining directors.	
	
Amendment of Governing Documents
 	
Under the Delaware General Corporation Law, amendments to a corporation’s certificate of incorporation require the approval of shareholders holding a majority of the outstanding shares entitled to vote on the amendment. If a class vote on the amendment is required by the Delaware General Corporation Law, a majority of the outstanding stock of the class is required, unless a greater proportion is specified in the certificate of incorporation or by other provisions of the Delaware General Corporation Law. Under the Delaware General Corporation Law, the board of directors may amend bylaws if so authorized in the charter. The shareholders of a Delaware corporation also have the power to amend bylaws.	  	Under the Luxembourg Corporate Law, amendments to the articles of association of the company require an extraordinary general meeting of shareholders held in front of a public notary at which at least one half of the share capital is represented. The notice of the extraordinary general meeting shall set out the proposed amendments to the articles of association.
 
If the aforementioned quorum is not reached, a second meeting may be convened by means of notices published twice at intervals of fifteen days or less and fifteen days before the meeting in the Luxembourg official gazette ( Mémorial, Recueil des Sociétés et Associations ) and in two Luxembourg newspapers. The second meeting shall be validly constituted	
 
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	  	regardless of the proportion of the share capital represented.
 
At both meetings, resolutions will be adopted if approved by at least two-thirds of the votes cast (unless otherwise mandatorily required by Luxembourg law). Where classes of shares exist and the resolution to be adopted by the general meeting of shareholders changes the respective rights attaching to such shares, the resolution will be adopted only if the conditions as to quorum and majority set out above are fulfilled with respect to each class of shares. A change of nationality of the company as well as an increase of the commitments of its shareholders require however the unanimous consent of the shareholders (and bondholders, if any).
 
If the company has issued bonds, any amendments to the object of the company or its legal form (except in the case of a merger, de-merger or assimilated operations) require the approval of the bondholders’ general meeting.
 
Our articles of association provide that for any extraordinary resolutions to be considered at a general meeting the quorum shall be at least one half (50%) of the issued share capital of the Company. If the said quorum is not present, a second meeting may be convened at which Luxembourg Corporate Law does not prescribe a quorum. Any extraordinary resolution shall be adopted at a quorate general meeting (save as otherwise provided by mandatory law) at a two thirds (2/3) majority of the votes validly cast on such resolution. Abstentions are not considered “votes.”
 
In very limited circumstances the board of directors may be authorized by the shareholders to amend the articles of association, albeit always within the limits set forth by the shareholders at a duly convened shareholders’ meeting. This is the case in the context of the Company’s authorized share capital within which the board of directors is authorized to issue further shares or in the context of a share capital reduction and cancellation of shares. The board of directors is then authorized to appear in front of a notary public to record the capital increase or decrease and to amend the share capital set forth in the articles of association.	
 
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Meetings of Shareholders
 	
Annual and Special Meetings
 	
Typical bylaws provide that annual meetings of shareholders are to be held on a date and at a time fixed by the board of directors. Under the Delaware General Corporation Law, a special meeting of shareholders may be called by the board of directors or by any other person authorized to do so in the certificate of incorporation or the bylaws.	  	Pursuant to the Luxembourg Corporate Law, at least one general meeting of shareholders must be held each year on the day and at the time indicated in the articles of association of the company. The purpose of such annual general meeting is to approve the annual accounts, allocate the results, proceed to statutory appointments and grant discharge to the directors. The annual general meeting must be held within six months of the end of each financial year.
 
Our articles of association provide that our annual general meeting be held on the 31st of May each year at 10:00 a.m. CET. If that day is a legal or banking holiday, the meeting will be held on the next following business day.
 
Other meetings of shareholders may be convened.
 
Pursuant to Luxembourg law, the board of directors is obliged to convene a general meeting so that it is held within a period of one month of the receipt of a written request of shareholders representing one-tenth of the issued capital. Such request must be in writing and indicate the agenda of the meeting.	
	
Quorum Requirements
 	
Under the Delaware General Corporation Law, a corporation’s certificate of incorporation or bylaws can specify the number of shares which constitute the quorum required to conduct business at a meeting, provided that in no event shall a quorum consist of less than one-third of the shares entitled to vote at a meeting.	  	Luxembourg law distinguishes ordinary resolutions and extraordinary resolutions.
 
Extraordinary resolutions relate to proposed amendments to the articles of association and certain other limited matters. All other resolutions are ordinary resolutions.
 
Ordinary Resolutions : pursuant to Luxemburg law there is no requirement of a quorum for any ordinary resolutions to be considered at a general meeting, and such ordinary resolutions shall be adopted by a simple majority of votes validly cast on such resolution. Abstentions are not considered “votes.”
 
Extraordinary Resolutions : extraordinary resolutions are required for any of the following matters, among others: (a) an increase or decrease of the authorized or issued capital, (b) a limitation or exclusion of preemptive rights, (c) approval of a statutory merger or de-merger ( scission ), (d) dissolution and (e) an amendment of the articles of association.	
 
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	  	Pursuant to Luxembourg law for any extraordinary resolutions to be considered at a general meeting the
quorum shall generally be at least one half (50%) of the issued share capital. If the said quorum is not present, a second meeting may be convened at which Luxembourg law does not prescribe a quorum. Any extraordinary resolution shall be adopted at a quorate general meeting (save as otherwise provided by mandatory law) at a two thirds (2/3) majority of the votes validly cast on such resolution. Abstentions are not considered “votes.”
 
Our articles of association will provide that for any ordinary resolutions to be adopted at a general meeting, at which Luxembourg Corporate Law does not prescribe a quorum, a simple majority of votes validly cast on such resolution is sufficient. Abstentions are not considered “votes.”
 
Our articles of association will provide that unless otherwise mandatorily required by law for any extraordinary resolutions to be considered at a general meeting the quorum shall be at least one half (50%) of our issued share capital. If the said quorum is not present, a second meeting may be convened at which Luxembourg Corporate Law does not prescribe a quorum. Any extraordinary resolution shall be adopted at a quorate general meeting (save as otherwise provided by mandatory law) at a two thirds (2/3) majority of the votes validly cast on such resolution. Abstentions are not considered “votes.”	
	
Indemnification of Officers, Directors and Employees
 	
Under the Delaware General Corporation Law, subject to specified limitations in the case of derivative suits brought by a corporation’s shareholders in its name, a corporation may indemnify any person who is made a party to any third-party action, suit or proceeding on account of being a director, officer, employee or agent of the corporation (or was serving at the request of the corporation in such capacity for another corporation, partnership, joint venture, trust or other enterprise) against expenses, including attorney’s fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by him or her in connection with the action, suit or proceeding through, among other things, a	  	Pursuant to Luxembourg law on agency, agents are entitled to be reimbursed any advances or expenses made or incurred in the course of their duties, except in cases of fault or negligence on their part.
 
Luxembourg law on agency is applicable to the mandate of directors and agents of the company.
 
Our articles of association will contain indemnification provisions setting forth the scope of indemnification of our directors and officers. These provisions will allow us to indemnify directors and officers against liability (to the extent permitted by	
 
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majority vote of a quorum consisting of directors who were not parties to the suit or proceeding, if the person:
 
•     acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation; and
 
•     in a criminal proceeding, had no reasonable cause to believe his or her conduct was unlawful.
 
The Delaware General Corporation Law permits indemnification by a corporation under similar circumstances for expenses (including attorneys’ fees) actually and reasonably incurred by such persons in connection with the defense or settlement of a derivative action or suit, except that no indemnification may be made in respect of any claim, issue or matter as to which the person is adjudged to be liable to the corporation unless the Delaware Court of Chancery or the court in which the action or suit was brought determines upon application that the person is fairly and reasonably entitled to indemnity for the expenses which the court deems to be proper.
 
To the extent a director, officer, employee or agent is successful in the defense of such an action, suit or proceeding, the corporation is required by the Delaware General Corporation Law to indemnify such person for actual and reasonable expenses incurred thereby. Expenses (including attorneys’ fees) incurred by such persons in defending any action, suit or proceeding may be paid in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of that person to repay the amount if it is ultimately determined that that person is not entitled to be so indemnified.	  	Luxembourg law) and expenses reasonably incurred or paid by them in connection with claims, actions, suits or proceedings in which they become involved as a party or otherwise by virtue of performing or having performed as a director or officer, and against amounts paid or incurred by them in the settlement of such claims, actions, suits or proceedings, subject to limited exceptions such as willful malfeasance, bad faith, gross negligence or reckless disregard of the duties of a director or officer. See “Certain Relationships and Related Party Transactions—Limitations of Liability and Indemnification Matters” and “Description of Share Capital—Board of Directors.” The indemnification extends, among other things, to legal fees, costs and amounts paid in the context of a settlement.
 
Pursuant to Luxembourg law, a company is generally liable for any violations committed by employees in the performance of their functions except where such violations are not in any way linked to the duties of the employee.	
	
Shareholder Approval of Business Combinations
 	
Generally, under the Delaware General Corporation Law, completion of a merger, consolidation, or the sale, lease or exchange of substantially all of a corporation’s assets or dissolution requires approval by the board of directors and by a majority (unless the certificate of incorporation requires a higher percentage) of outstanding stock of the corporation entitled to vote.	  	Under Luxembourg law and our articles of association, the board of directors has the widest power to take any action necessary or useful to achieve the corporate object. The board’s powers are limited only by law and the articles of association of the Company.
 
Any type of business combination that would require an amendment to the articles of association, such as a merger, de-merger, consolidation, dissolution or voluntary liquidation, requires an extraordinary resolution of a general meeting of shareholders.	
 
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	  	Transactions such as a sale, lease or exchange of substantial company assets require only the approval of the board of directors. Neither Luxembourg law nor our articles of association contain any provision specifically requiring the board of directors to obtain shareholder approval of the sale, lease or exchange of substantial assets of the Company.	
 
The Delaware General Corporation Law also requires a special vote of shareholders in connection with a business combination with an “interested shareholder” as defined in section 203 of the Delaware General Corporation Law. See “—Interested Shareholders” above.	  	 
Not applicable.	
	
Shareholder Action Without a Meeting
 	
Under the Delaware General Corporation Law, unless otherwise provided in a corporation’s certificate of incorporation, any action that may be taken at a meeting of shareholders may be taken without a meeting, without prior notice and without a vote if the holders of outstanding stock, having not less than the minimum number of votes that would be necessary to authorize such action, consent in writing. It is not uncommon for a corporation’s certificate of incorporation to prohibit such action.	  	A shareholder meeting must always be called if the matter to be considered requires a shareholder resolution under Luxembourg law or our articles of association.
 
Pursuant to Luxembourg law, shareholders of a public limited liability company may not take actions by written consent. All shareholder actions must be approved at an actual meeting of shareholders held before a notary public or under private seal, depending on the nature of the matter. Shareholders may vote by proxy.	
	
Shareholder Suits
 	
Under the Delaware General Corporation Law, a shareholder may bring a derivative action on behalf of the corporation to enforce the rights of the corporation. An individual also may commence a class action suit on behalf of himself or herself and other similarly situated shareholders where the requirements for maintaining a class action under the Delaware General Corporation Law have been met. A person may institute and maintain such a suit only if such person was a shareholder at the time of the transaction which is the subject of the suit or his or her shares thereafter devolved upon him or her by operation of law. Additionally, under Delaware case law, the plaintiff generally must be a shareholder not only at the time of the transaction which is the subject of the suit, but also through the duration of the derivative suit. The Delaware General Corporation Law also requires that the derivative plaintiff make a demand on the directors of the corporation to assert the corporate claim before	  	Pursuant to Luxembourg law and our articles of association, the board of directors has the widest power to take any action necessary or useful to achieve the corporate object. The board’s powers are limited only by law and the articles of association of the company.
 
Luxembourg law does not require shareholder approval before legal action may be initiated on behalf of the company. The board of directors has sole authority to decide whether to initiate legal action to enforce the company’s rights (other than, in certain circumstances, in the case of an action against board members).
 
Shareholders do not generally have authority to initiate legal action on the company’s behalf. However, the general meeting of shareholders may vote to initiate legal action against directors on	
 
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the suit may be prosecuted by the derivative plaintiff, unless such demand would be futile.	  	grounds that such directors have failed to perform their duties in accordance with the Luxembourg Corporate Law. If a director is responsible for a breach of the law or of a provision of the articles of association, an action can be initiated by any third party including a shareholder having a legitimate interest. In the case of a shareholder, such interest must be different from the interest of the company.
 
Luxembourg procedural law does not recognize the concept of class actions.	
	
Dividends and Distributions; Repurchases and Redemptions
 	
The Delaware General Corporation Law permits a corporation to declare and pay dividends out of statutory surplus or, if there is no surplus, out of net profits for the fiscal year in which the dividend is declared and/or for the preceding fiscal year as long as the amount of capital of the corporation following the declaration and payment of the dividend is not less than the aggregate amount of the capital represented by the issued and outstanding stock of all classes having a preference upon the distribution of assets.	  	Pursuant to Luxembourg law, dividend distributions may be declared (i) by the general meeting or (ii) by the board of directors in the case of interim dividends ( acomptes sur dividendes ).
 
Dividend distributions may be made if the following conditions are met:
 
•     except in the event of a reduction of the issued share capital, only if net assets on the closing date of the preceding fiscal year are, or following such distribution would not become, less than the sum of the issued share capital plus reserves (which may not be distributed by law or under our articles of association).
 
•     the amount of a distribution to shareholders may not exceed the sum of net profits at the end of the preceding fiscal year plus any profits carried forward and any amounts drawn from reserves which are available for that purpose, less any losses carried forward and with certain amounts to be placed in reserve in accordance with the law or our articles of association.
 
Interim dividend distributions may only be made if the following conditions are met:
 
•     interim accounts indicate sufficient funds are available for distribution.
 
•     the amount to be distributed does not exceed the total amount of net profits since the end of the preceding fiscal year for which the annual accounts have been	
 
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	  	approved, plus any profits carried forward and sums drawn from reserves available for this purpose, less losses carried forward and any sums to be placed in reserves in accordance with the law or the articles of association.
 
•     the board declares such interim distributions no later than two months after the date at which the interim accounts have been drawn up.
 
•     prior to declaring an interim distribution, the board must receive a report from the company’s auditors confirming that the conditions for an interim distribution are met.
 
The amount of distributions declared by the annual general meeting of shareholders shall include (i) the amount previously declared by the board of directors (i.e., the interim distributions for the year of which accounts are being approved), and if proposed (ii) the (new) distributions declared on the annual accounts.
 
Where interim distribution payments exceed the amount of the distribution subsequently declared at the general meeting, any such overpayment shall be deducted from the next distribution.
 
Our articles of association do permit interim distributions decided by our board of directors.	
		
Under the Delaware General Corporation Law, any corporation may purchase or redeem its own shares, except that generally it may not purchase or redeem these shares if the capital of the corporation is impaired at the time or would become impaired as a result of the redemption. A corporation may, however, purchase or redeem out of capital shares that are entitled upon any distribution of its assets to a preference over another class or series of its shares if the shares are to be retired and the capital reduced.	  	Pursuant to Luxembourg law, the company (or any party acting on its behalf) may repurchase its own shares and hold them in treasury, provided that:
 
•     the shareholders at a general meeting have previously authorized the board of directors to acquire company shares. The general meeting shall determine the terms and conditions of the proposed acquisition and in particular the maximum number of shares to be acquired, the period for which the authorization is given (which may not exceed five years) and, in the case of acquisition for value, the maximum and minimum consideration.
 
•     the acquisitions, including shares previously acquired by the company and held by it, and shares acquired by a person acting in his own name but on behalf of the company, may not have the effect of reducing the net assets below the amount of the issued share	
 
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	  	capital plus the reserves (which may not be distributed by law or under the articles of association).
 
•     the shares repurchased are fully paid-up.
 
No prior authorization by shareholders is required (i) if the acquisition is made to prevent serious and imminent harm to the company, provided that the board of directors informs the next general meeting of the reasons for and the purpose of the acquisitions made, the number and nominal values or the accounting value of the shares acquired, the proportion of the subscribed capital which they represent and the consideration paid for them; and (ii) in the case of shares acquired by either the company or by a person acting on behalf of the company with a view to redistributing the shares to the staff of the company, provided that the distribution of such shares is made within 12 months from their acquisition.
 
Luxembourg law provides for further situations in which the above conditions do not apply, including the acquisition of shares pursuant to a decision to reduce the capital of the company or the acquisition of shares issued as redeemable shares. Such acquisitions may not have the effect of reducing net assets below the aggregate of subscribed capital and reserves (which may not be distributed by law and are subject to specific provisions on reductions in capital and redeemable shares under Luxembourg law).
 
Any shares acquired in contravention of the above provisions must be re-sold within a period of one year after the acquisition or be cancelled at the expiration of the one-year period.
 
As long as shares are held in treasury, the voting rights attached thereto are suspended. Further, to the extent the treasury shares are reflected as assets on the balance sheet of the company, a non-distributable reserve of the same amount must be reflected as a liability. Our articles of association will provide that shares may be acquired in accordance with the law.	
	
Transactions with Officers or Directors
 	
Under the Delaware General Corporation Law, some contracts or transactions in which one or more of a corporation’s directors has an interest are not void or voidable because of such interest provided that some conditions, such as obtaining the required approval	  	There are no rules under Luxembourg law preventing a director from entering into contracts or transactions with the company to the extent the contract or the transaction is in the corporate interest of the company.	
 
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and fulfilling the requirements of good faith and full disclosure, are met. Under the Delaware General Corporation Law, either (a) the shareholders or the board of directors must approve in good faith any such contract or transaction after full disclosure of the material facts or (b) the contract or transaction must have been “fair” as to the corporation at the time it was approved. If board approval is sought, the contract or transaction must be approved in good faith by a majority of disinterested directors after full disclosure of material facts, even though less than a majority of a quorum.	  	The Luxembourg Corporate Law prohibits a director from participating in deliberations and voting on a transaction if (a) such director has an interest therein, and (b) the interests of such director or conflict with the interests of the company. The relevant director must disclose his personal interest to the board of directors and abstain from voting. The transaction and the director’s interest therein shall be reported to the next succeeding general meeting of shareholders.
 
The articles of association of the company may require that certain transactions between a director and the company be submitted for board and/or shareholder approval. Our articles of association provide that no director shall, solely as a result of being a director of the Company, have any duty to refrain from any decision or action to enforce its rights under any agreement or contract with the Company. A director who has an interest in a transaction carried out other than in the ordinary course of business which conflicts with the interests of the Company must advise the Board accordingly and have the statement recorded in the minutes of the meeting. The director concerned may not take part in the deliberations concerning that transaction. A special report on the relevant transaction is submitted to the shareholders at the next General Meeting, before any vote on the matter.	
	
Dissenters’ Rights
 	
Under the Delaware General Corporation Law, a shareholder of a corporation participating in some types of major corporate transactions may, under varying circumstances, be entitled to appraisal rights pursuant to which the shareholder may receive cash in the amount of the fair market value of his or her shares in lieu of the consideration he or she would otherwise receive in the transaction.	  	Neither Luxembourg law nor our articles of association provide for appraisal rights.	
	
Cumulative Voting
 	
Under the Delaware General Corporation Law, a corporation may adopt in its bylaws that its directors shall be elected by cumulative voting. When directors are elected by cumulative voting, a shareholder has a number of votes equal to the number of shares held by such shareholder times the number of directors nominated for election. The shareholder may cast all of such votes for one director or among the directors in any proportion.	  	Not applicable. See “—Board of Directors.”	
 
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Delaware	  	Luxembourg	
Anti-Takeover Measures
 	
Under the Delaware General Corporation Law, the certificate of incorporation of a corporation may give the board the right to issue new classes of preferred shares with voting, conversion, dividend distribution, and other rights to be determined by the board at the time of issuance, which could prevent a takeover attempt and thereby preclude shareholders from realizing a potential premium over the market value of their shares.
 
In addition, Delaware law does not prohibit a corporation from adopting a shareholder rights plan, or “poison pill,” which could prevent a takeover attempt and also preclude shareholders from realizing a potential premium over the market value of their shares.	  	Pursuant to Luxembourg law, it is possible to create an authorized share capital from which the board of directors is authorized by the shareholders to issue further shares and, under certain conditions, to limit, restrict or waive preferential subscription rights of existing shareholders. The rights attached to the shares issued within the authorized share capital will be equal to those attached to existing shares and set forth in the articles of association of the company.
 
The authority of the board of directors to issue additional shares is valid for a period of up to five years unless renewed by vote of the holders of at least two-thirds of the votes cast at a shareholders meeting.
 
Prior to the completion of this offering, we will have an authorized share capital of €1,000,000,000. Immediately after completion of this offering, the authorized share capital will be €999,998,175.23.
 
Our articles of association will authorize our board of directors to issue ordinary shares within the limits of the authorized share capital at such times and on such terms as our board or its delegates may decide for a period commencing on the date of our articles of association and ending five years after the date on which the minutes of the shareholders’ meeting approving such authorization are published in the Luxembourg official gazette Mémorial, Recueil des Sociétés et Associations (unless such period is extended, amended or renewed). Accordingly, our board will be authorized to issue up to ordinary shares until such date. We currently intend to seek renewals and/or extensions as required from time to time.	
 
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 ENFORCEMENT OF CIVIL LIABILITIES
Luxembourg
We are a company organized under the laws of the Grand Duchy of Luxembourg. Most of our assets are located outside the United States. Furthermore, most of our directors and officers named in this prospectus reside outside the United States and most of their assets are located outside the United States. As a result, investors may find it difficult to effect service of process within the United States upon us or these persons or to enforce outside the United States judgments obtained against us or these persons in U.S. courts, including judgments in actions predicated upon the civil liability provisions of the U.S. federal securities laws. Likewise, it may also be difficult for an investor to enforce in U.S. courts judgments obtained against us or these persons in courts located in jurisdictions outside the United States, including actions predicated upon the civil liability provisions of the U.S. federal securities law. It may also be difficult for an investor to bring an original action in a Luxembourg or other foreign court predicated upon the civil liability provisions of the U.S. federal securities laws against us or these persons. Luxembourg law, furthermore, does not recognize a shareholder’s right to bring a derivative action on behalf of the Company.
In particular, there is doubt as to the enforceability of original actions in Luxembourg courts of civil liabilities predicated solely upon U.S. federal securities laws, and the enforceability in Luxembourg courts of judgments entered by U.S. courts predicated upon the civil liability provisions of U.S. federal securities laws will be subject to compliance with procedural and other requirements under Luxembourg law, including the condition that the judgment does not violate Luxembourg public policy. We are a Luxembourg public limited liability company (“ société anonyme ”) and it may be difficult for you to obtain or enforce judgments against us or our executive officers and directors in the United States. See “Risk Factors—Risks Related to Investment in a Luxembourg Company” for further discussion of enforcement of civil liabilities under Luxembourg law.
In addition, under Luxembourg law, directors do not assume any personal obligations for the Company’s commitments. Directors are liable to the Company for the performance of their duties as directors and for any misconduct in the management of the Company’s affairs. Directors are further jointly and severally liable both to the Company and to any third parties for damages resulting from violations of the law or our articles of association. Directors will only be discharged from such liability for violations to which they were not a party, provided no misconduct is attributable to them and they have reported such violations at the first general meeting after they had knowledge thereof. In addition, directors may under specific circumstances also be subject to criminal liability, such as in the case of an abuse of assets. A shareholder of the Company may file a claim against the Company in Luxembourg to the extent that the Luxembourg court has jurisdiction over such claim in accordance with the Luxembourg judicial code. See “Comparison of Shareholder Rights—Limitation on Personal Liability of Directors” for further discussion of liabilities relating to directors of the Company.
Further, Luxembourg law does not require shareholder approval before legal action may be initiated on behalf of the Company. The board of directors has sole authority to decide whether to initiate legal action to enforce the Company’s rights (other than, in certain circumstances, in the case of an action against board members). Shareholders do not generally have authority to initiate legal action on the Company’s behalf. However, the general meeting of shareholders may vote to initiate legal action against directors on grounds that such directors have failed to perform their duties. If a director is responsible for a breach of the law or of a provision of our articles of association, an action can be initiated by any third party including a shareholder having a legitimate interest. In the case of a shareholder, such interest must be different from the interest of the Company. Luxembourg procedural law does not recognize the concept of class actions. See “Comparison of Shareholder Rights—Shareholder Suits” for further discussion of shareholder actions.
 
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Brazil
A substantial portion of our assets and operations are located in Brazil and certain of our executive officers reside in Brazil. As a result, it may not be possible (or it may be difficult) for investors to effect service of process upon us and these persons within the United States or other jurisdictions outside Brazil or to enforce against us or them judgments predicated upon the civil liability provisions of the U.S. federal securities laws or the laws of such other jurisdictions.
We have been advised by legal counsel, that a judgment of a United States court for civil liabilities predicated upon the federal securities laws of the United States may be enforced in Brazil, subject to certain requirements described below. Our Brazilian counsel has advised that a judgment against us, our directors and officers or certain advisors named herein obtained in the United States would be enforceable in Brazil upon confirmation of that judgment by the Superior Court of Justice ( Superior de Tribunal Justiça, or STJ ). That confirmation will only occur if the U.S. judgment:
 
 	•	 	fulfills all formalities required for its enforceability under the laws of the United States;	
 
 	•	 	is issued by a court of competent jurisdiction after proper service of process on the parties, which services must comply with Brazilian law if made in Brazil or after sufficient evidence of the parties’ absence has been given, as established pursuant to applicable law;	
 
 	•	 	is not subject to appeal;	
 
 	•	 	is authenticated by a Brazilian consulate in the United States and is accompanied by a sworn translation into Portuguese; and	
 
 	•	 	does not violate Brazilian public policy, public morality, good morals or national sovereignty (as set forth in Brazilian law).	
Our Brazilian counsel has also advised us that:
 
 	•	 	civil lawsuits may be brought before Brazilian courts in connection with the prospectus based on the federal securities laws of the United States and that, subject to applicable law, Brazilian courts may enforce such liabilities in such lawsuits against us or the directors and officers and certain advisors named herein (provided that provisions of the federal securities laws of the United States do not contravene Brazilian public policy, good morals or national sovereignty and provided further that, under Brazilian law, Brazilian courts may assert jurisdiction whenever the defendant is domiciled in Brazil, the obligation has to be performed in Brazil or the subject matter under dispute originates in Brazil, considering that Brazilian courts may exercise jurisdiction over such matters or disputes pursuant to article 88 of the Brazilian Civil Procedure Code); and	
 
 	•	 	the ability of a judgment creditor or the other persons named above to satisfy a judgment by attaching certain assets of ours is limited by provisions of Brazilian bankruptcy, insolvency, liquidation, reorganization or similar laws, given that assets are located in Brazil.	
In addition, we have been further advised that a Brazilian or foreign plaintiff who resides outside Brazil or is abroad during the course of litigation in Brazil and who does not own real property in Brazil must provide a bond to guarantee the payment of the defendant’s legal fees and court expenses, except in case of collection claims based on an instrument (which do not include the notes issued hereunder), that may enforced in Brazilian courts without the previous review of its merits ( título executivo extrajudicial ) or counterclaims as established under Article 836 of the Brazilian Code of Civil Procedure (Law No. 5,869/1,973). The bond of guarantee must have a value sufficient to satisfy the payment of court fees and defendant’s attorney fees, as determined by a Brazilian judge.
The confirmation process may be time consuming and may also give rise to difficulties in enforcing the foreign judgment in Brazil. Accordingly, we cannot assure you that confirmation would be obtained, that the process described above would be conducted in a timely manner or that a Brazilian court would enforce a monetary judgment for violation of the securities laws of countries other than Brazil.
 
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Spain
Certain corporate functions and operations are located in Spain and consequently it may not be possible for an investor to bring actions under the civil liability provisions of the U.S. federal securities laws and/or enforce a judgment determining such liability.
It may not be possible for an investor to effect service of process within the United States or the notice may be considered invalid if an investors effects service of process within the United States under the civil liability provisions of the U.S. federal securities laws.
Regarding the investor’s ability to enforce a judgment of a U.S. court determining liability under the civil liability provisions of the U.S. federal securities laws, Spanish law provides that the enforcement in Spain of such a judgment is subject to obtaining recognition of such judgment ( exequatur ): (i) according to the provisions of any applicable treaty (there is currently not a bilateral treaty between the United States and Spain regarding enforcement of court judgments on these civil matters); and (ii) in the absence of any such treaty, (a) pursuant to Articles 952 and 953 of the Spanish Civil Procedural Law of 1881 (the “CPL 1881”), which establish the so called “reciprocity regime” or (b) pursuant to Article 954 of the CPL 1881, which establishes the “conditional regime.”
According to the “reciprocity regime,” exequatur of a foreign judicial decision in Spain is granted on the same terms as a Spanish judicial decision is granted in that foreign country. Reciprocity should be bilateral, current and proven. In practice the reciprocity regime is no longer applied in Spain because the Spanish Supreme Court established in relation to this regime some basic conditions for the recognition and enforcement of foreign judgments which in essence are the same as those established in the “conditional regime.”
According to the “conditional regime,” a foreign judgment may be enforced in Spain if it meets the following conditions:
 
 	•	 	the judgment must be firm and final;	
 
 	•	 	the judgment must have been issued in the context of a personal claim where the defendant was duly notified of the proceedings against it and was given opportunity to be heard;	
 
 	•	 	the judgment must be contained in a solemn public document known as a writ of enforcement ( ejecutoria );	
 
 	•	 	the subject matter of the judgment must not be contrary to public policy or one of the matters over which Spanish courts have exclusive jurisdiction; and	
 
 	•	 	there being no inconsistency between the foreign judgment and any previous judgment rendered in Spain or any pending proceedings in Spain.	
Consequently, there are doubts as to whether a judgment of a U.S. court determining liability under the civil liability provisions of the U.S. federal securities laws may be enforced in Spain.
It should also be noted that the Capital Corporation Law of Spain limits the liability of shareholders and determines the liability of board members under specific circumstances.
Finally, it may not be possible for an investor to bring an original action in Spain under the civil liability provisions of the U.S. federal securities laws.
 
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 DESCRIPTION OF CERTAIN INDEBTEDNESS
The following is a summary of certain of our indebtedness that is currently outstanding. The following descriptions do not purport to be complete and are qualified in their entirety by reference to the agreements and related documents referred to herein, copies of which have been filed as exhibits to the registration statement of which this prospectus forms a part.
Brazilian Debentures
On November 22, 2012, Atento Brasil, S.A. (formerly BC Brazilco Participações S.A.) as the issuer (the “Brazilian Issuer”), entered into an indenture governed by Brazilian law (the “Brazilian Indenture”) for the issuance of BRL 915 million non-convertible, secured debentures due 2019 (the “Brazilian Debentures”) with Planner Trustee DTVM LTDA, as trustee (the “Brazilian Trustee”), in favor of the holders of the Brazilian Debentures.
The Brazilian Debentures were offered to the public in Brazil on a restricted-effort placement basis pursuant to a distribution agreement dated December 5, 2012 (the “Brazilian Distribution Agreement”), between Banco BTG Pactual S.A., Banco Santander (Brasil) S.A., Banco Bradesco BBI S.A. and Banco Itaú BBA S.A. (the “Joint Lead Arrangers”). The Joint Lead Arrangers acted as book-runners and underwriters for and managed the public offering of the Brazilian Debentures on a fully underwritten basis ( coordenador líder com compromisso de garantia firme de colocaçã o ) in accordance with the terms of Instruction number 476 dated January 16, 2009 of the Brazilian Securities and Exchange Commission, as amended ( Comissão Nacional de Valores , or “CVM”). The Brazilian Debentures were subscribed for on or prior to December 12, 2012 by the Joint Lead Arrangers (the “Subscription Date”) and were distributed to a maximum of 20 investors, all such investors being qualified investors as defined in article 4 of CVM Instruction number 476 (“Brazilian Qualified Investors”). The Brazilian Debentures are listed for trading on the secondary market through Cetip 21 - Títulos e Valores Mobiliários (“CETIP 21”) which is administered and operated by CETIP.
The Brazilian Debentures, the Brazilian Indenture and the Brazilian Distribution Agreement are governed by and construed in accordance with the laws of Brazil. Any dispute arising out of or in connection with the Brazilian Debentures shall be settled by arbitration under the Arbitration Guidelines of the Arbitration and Mediation Center of the Brazil—Canada Chamber of Commerce. The decision of the arbitrators shall be final, binding and enforceable.
Purpose
The Brazilian Debentures were issued and offered in connection with the Acquisition and all of the net proceeds raised by the Brazilian Issuer from the offering of the Brazilian Debentures were used for payment by the Brazilian Issuer and/or its direct or indirect holding companies of a portion of the purchase price for the Acquisition and a portion of the related fees, costs and expenses and refinancing certain existing indebtedness of Atento Inversiones y Teleservicios S.A.U., and its direct or indirect subsidiaries.
Form
The Brazilian Debentures were issued as registered, book entry debentures. Title to the Brazilian Debentures shall be evidenced by the deposit statement issued by Itaú Corretora de Valores S.A. in its role as book keeping institution, provided that for any Brazilian Debentures held in custody with CETIP 21, CETIP shall issue the statement which shall include the holder’s name which shall constitute evidence of legal title to the relevant Brazilian Debentures. The Brazilian Debentures shall not be convertible into stock at any time.
 
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Price, Interest and Fees
The Brazilian Debentures shall be paid in cash in Brazilian Reais upon the subscription thereof at the face value, being a unit value of one million Reais (“Note Face Value”), plus interest payable on the Brazilian Debentures calculated on a pro rata temporis basis since the first Payment Date (the “Settlement Date”) until the respective Payment Date.
The Brazilian Debentures bear interest on the outstanding balance of the Face Value from the first Payment Date at a rate per annum equal to the average daily rate of the One Day “over extra-group”—DI—Interfinancial Deposits, based on a two hundred fifty-two business day year, (as such rate is disclosed by CETIP in the daily release available on its web page the (“DI Rate”) exponentially added by a spread of 3.70%).
Interest is paid semiannually from the date of the issue of the Brazilian Debentures, with the final interest payment being due on the Maturity Date (as defined below).
Covenants
Under the terms of the Brazilian Debentures, we and our subsidiaries are required to be in compliance on a consolidated basis with a net leverage covenant which is tested on a quarterly basis subject to certain cure rights. The leverage ratio currently applicable is 3.5:1. Starting December 31, 2014, the applicable ratio will be 3.0:1; 2.5:1 effective as of December 31, 2015; and 2.0:1 as of December 31, 2016 and thereafter. As of June 30, 2014, we were in compliance with all such covenants.
Repayment
The Brazilian Debentures contain the following amortization schedule: December 11, 2016—16.9%; December 11, 2017—22.3%; December 11, 2018—26.1%; and December 11, 2019—34.7%.
Prepayments
The Company may, at its sole option, at any time from, and including, the date of issuance of the Brazilian Debentures and upon prior notice, effect an early redemption of all or any portion of the outstanding balance of the Face Value of all the outstanding Brazilian Debentures together with the interest payable on the Brazilian Debentures, calculated on a pro rata basis since the first interest payment date of Brazilian Debentures, or the immediately preceding interest payment date as the case may be, to the date of redemption plus a flat premium on the Face Value of Brazilian Debentures redeemed (the “Early Redemption Premium”) equivalent to the amounts set out in the table below:

Period after Issue Date for Debentures	  	Early
Redemption
Premium	 	
Up to 12 months	  	 	0.90	% 	
After 12 months up to and including 24 months	  	 	0.80	% 	
After 24 months up to and including 36 months	  	 	0.70	% 	
After 36 months up to and including 48 months	  	 	0.60	% 	
After 48 months up to and including 60 months	  	 	0.50	% 	
After 60 months up to and including 72 months	  	 	0.40	% 	
After 72 months up to and including 84 months	  	 	0.30	% 	
Security and Guarantees
The full and punctual payment of the obligations of the Brazilian Issuer in respect of the Brazilian Debentures shall be secured by collateral in accordance with the terms of article 62, item I, of Law number 6404,
 
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dated December 15, 1976, as amended (the “Corporation Act”). Such collateral shall comprise, (i) a fiduciary lien over the shares of the Brazilian Issuer, (ii) a fiduciary lien over the shares of Atento Brasil S.A., and (iii) a fiduciary assignment of the credit rights of Atento Brasil S.A. in respect of its rights to receivables due from Telefónica in connection with the Master Services Agreement (together, the “Fiduciary Liens”).
Events of Default and Undertakings
The Brazilian Indenture sets out certain events of default (subject to materiality, cure periods and other exceptions where appropriate) including, without limitation, the following:
 
 	•	 	liquidation, dissolution or extinguishment of the Brazilian Issuer or any controlled company of the Brazilian Issuer whose net revenue represents an amount equal to or in excess of 5% of the consolidated net revenue of the Brazilian Issuer and its controlled subsidiaries (“Material Controlled Company”);	
 
 	•	 	default, by the Brazilian Issuer, of any Debentures and/or to the Brazilian money obligation relating to the Brazilian Indenture;	
 
 	•	 	default by the Brazilian Issuer, of any non-monetary obligation provided for in the Brazilian Indenture and/or the Fiduciary Lien Agreements and/or under the guarantee granted by the Brazilian Issuer;	
 
 	•	 	invalidity, nullity or unenforceability of any of the Fiduciary Lien Agreements and/or the Guarantee granted by the Brazilian Issuer;	
 
 	•	 	any representation or warranty made or deemed to be made by the Brazilian Issuer that is or proves to have been incorrect or misleading in any material respect;	
 
 	•	 	acceleration of maturity of any financial debt of the Brazilian Issuer or of any Material Controlled Company following any failure to pay any amount that is due and payable;	
 
 	•	 	default of the Brazilian Issuer (or any of its controlled companies) to pay any debt or financial obligation in excess of BRL 30,000,000, including amounts in respect of any final and non-appealable court decisions or arbitration awards;	
 
 	•	 	breach of financial covenant (see “Financial covenants” below);	
 
 	•	 	insolvency;	
 
 	•	 	commencement of certain litigation;	
 
 	•	 	expropriation, confiscation or any other actions by any government authority of any jurisdiction resulting in loss by the Brazilian Issuer or by any Controlled Company of 20% or more of the Brazilian Issuer’s total assets;	
 
 	•	 	failure to comply with laws, including environmental laws and regulations;	
 
 	•	 	impounding, attachment or seizure of assets of the Brazilian Issuer or of any Controlled Company in excess of BRL 30,000,000;	
 
 	•	 	modification of certain acquisition documents and other agreements;	
 
 	•	 	a substantial change to the corporate purpose of the Brazilian Issuer or any of its Material Controlled Companies;	
 
 	•	 	disposal, amalgamation or merger or consolidation of the Brazilian Issuer with other companies;	
 
 	•	 	distribution of dividends, payment of interest on shareholder capital or other payments to the shareholders of the Brazilian Issuer in excess of the mandatory minimum distribution set forth in Brazilian law;	
 
 	•	 	the occurrence of a change of control in respect of the Brazilian Issuer;	
 
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 	•	 	the creation of a lien on any assets of the Brazilian Issuer; and	
 
 	•	 	incurrence of financial indebtedness.	
The Brazilian Indenture also contains affirmative covenants, subject to certain exceptions and including, but not limited to, covenants relating to:
 
 	•	 	maintenance of relevant authorizations, permits and licenses;	
 
 	•	 	retaining service providers necessary for the Brazilian Issuer to perform its obligations under the Brazilian Indenture;	
 
 	•	 	payment of all taxes on the Brazilian Debentures payable by the Brazilian Issuer; and	
 
 	•	 	provision of information to the information system of the CVM and to CETIP.	
The Brazilian Indenture contains certain reporting requirements, in particular an obligation to provide audited consolidated annual financial statements and consolidated quarterly financial statements prepared using Brazilian GAAP or IFRS.
Financial covenants
The Brazilian Indenture includes a financial covenant requiring the Brazilian Issuer to meet a certain ratio of consolidated total net debt to consolidated EBITDA as defined in the Brazilian Indenture, of each quarter (the “Leverage Ratio”). Compliance with this financial covenant is measured based on the Brazilian GAAP or IFRS financial statements of the Brazilian Issuer. The financial covenant may be cured up to 3 times during the life of the Brazilian Debentures if a contribution is made to the share capital of the Brazilian Issuer in an amount which when added to consolidated EBITDA would result in the Brazilian Issuer being in compliance with the Leverage Ratio (an “Equity Cure”). Any Equity Cure shall apply to consolidated EBITDA for the current testing period and for three subsequent testing periods.
Enforcement
Upon the occurrence of an Event of Default (other than an event of default for insolvency, upon the occurrence of which the Brazilian Debentures shall become immediately due and payable), the Brazilian Trustee shall call a general meeting of the holders of the Brazilian Debentures Debenture Holders (to be held within the shortest term provided for by law) at which the holders of the Brazilian Debentures representing 60% or more of the outstanding principal amount of the Brazilian Debentures may decide to accelerate the maturity of the Brazilian Debentures immediately.
Vendor Loan Note
On December 12, 2012, Midco issued the Vendor Loan Note for an aggregate principal amount of €110.0 million ($151.7 million) to an affiliate of Telefónica (the “VLN Lender”). The Vendor Loan Note was issued as deferred consideration for a portion of the purchase price paid by Bain Capital in connection with the Acquisition. The Vendor Loan Note will mature on December 12, 2022. Interest on the Vendor Loan Note accrues at a fixed rate of 5.00% per annum, and is payable annually in arrears. Interest on the Vendor Loan Note is payable in cash, if (i) no default (or similar event) is continuing or would arise under any of our financing documents, as defined in the agreement governing the Vendor Loan Note, as a result of such interest payment or any distribution or payment by a subsidiary to Midco to enable Midco to make the interest payment, and (ii) we are able to lawfully upstream funds to Midco. Any interest that is not payable in cash is capitalized and added to the outstanding principal amount outstanding under the Vendor Loan Note. Interest is payable in cash only to the extent that the borrower has received upstream payments from its subsidiaries in excess of the lesser of (A) the expenses incurred during such interest period in connection with our operation plus management and advisory fees paid to Bain Capital Partners, LLC or (B) €35.0 million (increased by 3% for each subsequent interest period
 
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on a compounding basis). Additionally, following the sale of at least 66.66% of the business and assets of the Company, Midco shall be required to use the proceeds of such sale to repay the Vendor Loan Note, subject to items (i) and (ii) above.
On May 16, 2014, Midco entered into an amendment letter and certain other related documentation with the VLN Lender which provided for certain amendments to be made to the Vendor Loan Note including among other changes reducing the principal amount of the Vendor Loan Note by €25.4 million (or approximately $34.9 million).
The Vendor Loan Note is expressed by its terms to be senior to any debt or equity claim of the shareholders of Midco and their affiliates, pari passu with trade payables of Midco and subordinated to any other indebtedness of Midco. The Vendor Loan Note contains certain restrictions on payments by Topco and its subsidiaries to Bain Capital during the term of the Vendor Loan Note that are triggered if the ratio of financial indebtedness (as defined therein) to EBITDA for Topco and its subsidiaries is greater than 2.5 to 1.0. The Vendor Loan Note does not provide for any recourse to group companies (whether in the form of guarantees, security interests or otherwise) or events of default related to operating companies or cross-default or cross acceleration provisions. The Vendor Loan Note does not contain any other financial maintenance covenants. As of June 30, 2014, we were in compliance with the terms of the Vendor Loan Note.
Midco may repay the loan, without any premium or penalty, in whole or in part, at any time prior to the maturity date, provided that such payment shall include all accrued by unpaid interest.
Contingent Value Instruments
On December 12, 2012, two of our direct subsidiaries, Atalaya Luxco 2 S.à r.l. (formerly BC Luxco 2 S.à r.l.) (“Atalaya Luxco 2”) and Atalaya Luxco 3 S.à r.l. (formerly BC Luxco 3 S.à r.l.) (“Atalaya Luxco 3”), entered into contingent value instruments (each a “CVI”) with Atento Inversiones and Venturini S.A., which are subsidiaries of Telefónica, S.A. Such CVIs together have an aggregate par value of ARS 666.8 million. The CVIs are the senior obligations of Atalaya Luxco 2 and Atalaya Luxco 3 and are subject to mandatory (partial) repayment to the extent of (i) our Argentinian subsidiaries having a balance of distributable cash in excess of the greater of (A) a certain minimum cash amount, as applicable to each Argentinian subsidiary (adjusted to take account of inflation) and (B) the amount that is necessary to be retained by our Argentinian subsidiaries in order to meet their financial obligations for such fiscal year pursuant to their business plans, (ii) a sale of all or substantially all of the shares or the assets of the Argentinian subsidiaries to non-affiliated party, (iii) sale of all or substantially all of the shares or the assets of Atento Luxco to a non-affiliated party and (iv) a distribution, payment or repayment made by any Argentinian subsidiary to Atalaya Luxco 2, S.à r.l. or Atalaya Luxco 3, S.à r.l, in respect of the securities of such Argentinian subsidiary. The CVI does not contain any other financial maintenance convents. As of June 16, 2014, we were in compliance with the terms of the CVI.
The CVIs do not accrue interest and are recognized at fair value. As of June 30, 2014, the fair value of the CVIs was $36.4 million. See Note 3(s) “Fair Value of Derivatives and CVI” to the Successor financial information and Note 10 to the Interim financial statements for additional information. Under the terms of each CVI, Atalaya Luxco 2, S.à r.l. and Atalaya Luxco 3, S.à r.l. have the right to off-set certain amounts specified in the SPA (in the circumstances specified in the SPA) against the outstanding balance under such CVI.
The obligations of Atalaya Luxco 2, S.à r.l. and Atalaya Luxco 3, S.à r.l. under each CVI will be extinguished on the earlier of: (i) the date on which the outstanding balance under such CVI is reduced to zero (in respect of repayment of outstanding debt or reduction of the outstanding balance pursuant to the terms and conditions of the CVIs) and (ii) December 12, 2022. During the term of the CVIs, the CVI holders have preferential purchase rights in the event the Argentinian subsidiaries are sold.
The obligations under the CVIs are not guaranteed by any subsidiary other than Atalaya Luxco 2, Atalaya Luxco 3 and its Argentinian subsidiaries.
 
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Brazil BNDES Credit Facility
On February 3, 2014, Atento Brasil S.A. entered into a credit agreement with Banco Nacional de Desenvolvimento Econômico e Social—BNDES (“BNDES”) in an aggregate principal amount of BRL 300 million (the “BNDES Credit Facility”).
The total amount of the BNDES Credit Facility is divided into five tranches in the following amounts and subject to the following interest rates:

 	  	Amount of Each
Tranche	  	Interest Rate	
Tranche A	  	BRL 182,330,000.00	  	Long Term Interest Rate (Taxa de Juros de Longo Prazo—TJLP) plus 2.5% per annum	
Tranche B	  	BRL 45,583,000.00	  	SELIC Rate plus 2.5% per annum	
Tranche C	  	BRL 64,704,000.00	  	4.0% per year	
Tranche D	  	BRL 5,296,000.00	  	6.0% per year	
Tranche E	  	BRL 2,048,000.00	  	Long Term Interest Rate (Taxa de Juros de Longo Prazo—TJLP)	
Interested is paid in arrears on a quarterly basis.
The BNDES Credit Facility is to be repaid in 48 monthly installments. The first payment will be due on March 15, 2016 and the last payment will be due on February 15, 2020.
The BNDES Credit Facility contains covenants that restrict Atento Brasil S.A.’s ability to transfer, assign, charge or sell the intellectual property rights related to technology and products developed by Atento Brasil S.A. with the proceeds from the BNDES Credit Facility. As of June 30, 2014, we were in compliance with these covenants. The BNDES Credit Facility does not contain any other financial maintenance covenants.
The BNDES Credit Facility contains customary events of default including the following: (i) reduction of the number of the employees of Atento Brasil S.A., (ii) existence of an unfavorable court decision against the Company for the use of children as workforce, slavery or any environmental crimes and (iii) inclusion in the by-laws of Atento Brasil S.A. of any provision that restricts Atento Brasil S.A.’s ability to paying its obligations under the BNDES Credit Facility.
7.375% Senior Secured Notes due 2020
Atento Luxco issued $300.0 million aggregate principal amount of our Senior Secured Notes pursuant to an indenture, dated January 29, 2013, among Atento Luxco, the guarantors signatory thereto, Citibank, N.A. and Citigroup Global Markets Deutschland AG, governing the Senior Secured Notes. The Senior Secured Notes are senior secured obligations of Atento Luxco and are guaranteed on a senior secured first-priority basis by Atento Luxco and certain of its subsidiaries.
The Senior Secured Notes will mature on January 29, 2020. Interest on the Senior Secured Notes accrues at a rate of 7.375% per annum and is payable semi-annually in arrears on January 29 and July 29 of each year. Interest is computed on the basis of a 360-day year comprised of twelve 30-day months. Prior to January 29, 2016, we may redeem up to 40% of the principal amount of the notes with the proceeds of certain equity offerings at a redemption price of 107.375% of the principal amount of the notes, together with accrued and unpaid interest, if any, to, but not including, the date of redemption. Prior to January 29, 2016, we may also redeem some or all of the Senior Secured Notes at a price equal to 100% of the principal amount of the notes redeemed plus accrued and unpaid interest, if any, plus a “make-whole” premium. We may also redeem, during any 12-month period commencing from the issue date of the Senior Secured Notes until January 29, 2016, up to 10% of the principal amount of the Senior Secured Notes at a redemption price equal to 103% of the principal amount thereof, plus accrued and unpaid interest, if any, to, but not including, the date of redemption. On or after
 
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January 29, 2016, we may redeem all or a part of the Senior Secured Notes at our option, upon not less than 30 nor more than 60 days’ notice, at the redemption prices (expressed as a percentage of the principal amount) set forth below, plus accrued and unpaid interest on the Senior Secured Notes to be redeemed to the applicable redemption date if redeemed during the twelve-month period beginning on January 29 of the years indicated below:

Period	  	Redemption Price	 	
2016	  	 	105.531	% 	
2017	  	 	103.688	% 	
2018	  	 	101.844	% 	
2019 and thereafter	  	 	100.000	% 	
The indenture governing the Senior Secured Notes contains covenants that, among other things, restrict the ability of Atento Luxco and certain of our subsidiaries to: incur or guarantee additional indebtedness; pay dividends or make other distributions or redeem or repurchase capital stock; issue, redeem or repurchase certain debt; issue certain preferred stock or similar equity securities; make loans and investments; sell assets; incur liens; enter into transactions with affiliates; enter into agreements restricting certain subsidiaries’ ability to pay dividends; and consolidate, merge or sell all or substantially all of our assets. These covenants are subject to a number of important exceptions and qualifications. As of June 30, 2014, we were in compliance with these covenants. There are no other financial maintenance covenants under the indenture governing the Senior Secured Notes. In addition, in certain circumstances, if Atento Luxco sells assets or experiences certain changes of control, it must offer to purchase the Senior Secured Notes.
Super Senior Revolving Credit Facility
Overview
On January 28, 2013, Atento Luxco entered into the €50.0 million ($69 million) Revolving Credit Facility with Banco Bilbao Vizcaya Argentaria, S.A., Banco Santander (México), S.A., Institución de Banca Múltiple, Grupo Financiero Santander México, Banco Santander, S.A. and BBVA Bancomer, S.A., Institución de Banca Múltiple, Grupo Financiero BBVA Bancomer (together, the “Lenders”).
The Revolving Credit Facility allows for borrowings in Euros, Mexican Pesos and U.S. dollars and includes borrowing capacity for letters of credit and ancillary facilities (including an overdraft, current account or similar facility; a guarantee, bonding, documentary or stand-by letter of credit facility; a short term loan facility; a derivatives facility; and a foreign exchange facility). The Revolving Credit Facility matures in July 2019.
Interest rate and fees
The rate of interest under the Revolving Credit Facility is the percentage rate per annum which is the aggregate of (i) the applicable margin, (ii) EURIBOR or, in relation to any loan in a currency other than Euro, LIBOR or the applicable floating rate for Mexican Pesos and (iii) the mandatory cost (if any). The applicable margin will initially be 4.50% per annum and will be subject to a step-down based on a secured leverage ratio.
In addition to paying interest on the outstanding principal amounts under the Revolving Credit Facility, we are required to pay a commitment fee of 40% of the applicable margin per annum in respect of the Lenders unutilized commitments.
Guarantee and Security
All obligations under the Revolving Credit Facility are by the initial guarantors on the same terms as the Senior Secured Notes.
 
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The Revolving Credit Facility is secured on a first-priority basis by a security interest in the same collateral that secures the Senior Secured Notes. However, under the terms of the security documents, the proceeds of any collection or other realization of collateral received in connection with the exercise of remedies will be applied to repay amounts due under the Revolving Credit Facility before the holders of the notes receive any such proceeds.
Certain Covenants and Events of Default
The Revolving Credit Facility contains the similar covenants as the Senior Secured Notes, which restrict, (subject to the same exceptions as those in respect of the covenants relating to the Senior Secured Notes), our and our restricted subsidiaries ability to: incur or guarantee additional indebtedness; pay dividends or make other distributions or redeem or repurchase capital stock; issue, redeem or repurchase certain debt; issue certain preferred stock or similar equity securities; make loans and investments; sell assets; incur liens; enter into transactions with affiliates; enter into agreements restricting certain subsidiaries’ ability to pay dividends; and consolidate, merge or sell all or substantially all of our assets. As of June 30, 2014, we were in compliance with these covenants.
There are no other financial maintenance covenants under the Revolving Credit Facility.
The covenants under the Revolving Credit Facility will be suspended during any period in which the notes are rated investment grade by both Moody’s and Fitch. The Revolving Credit Facility includes the same events of default as the Senior Secured Notes.
 
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 SHARES ELIGIBLE FOR FUTURE SALE
Prior to this offering, there has been no public market for our ordinary shares. Future sales of substantial amounts of our ordinary shares in the public market, or the perception that such sales may occur, could adversely affect the prevailing market price of our ordinary shares. No prediction can be made as to the effect, if any, future sales of ordinary shares, or the availability of ordinary shares for future sales, will have on the market price of our ordinary shares prevailing from time to time.
Sale of Restricted Shares
Upon completion of this offering, we will have 72,849,558 ordinary shares outstanding. Of these ordinary shares, the ordinary shares being sold in this offering, plus any shares sold by us or the selling shareholder upon exercise of the underwriters’ option to purchase additional shares, will be freely tradable without restriction under the Securities Act, except for any such shares which may be held or acquired by an “affiliate” of ours, as that term is defined in Rule 144 promulgated under the Securities Act, which shares will be subject to the volume limitations and other restrictions of Rule 144 described below. The remaining ordinary shares held by our existing shareholders upon completion of this offering will be “restricted securities,” as that phrase is defined in Rule 144, and may be resold only after registration under the Securities Act or pursuant to an exemption from such registration, including, among others, the exemptions provided by Rule 144 and 701 under the Securities Act, which rules are summarized below. These remaining ordinary shares held by our existing shareholders upon completion of this offering will be available for sale in the public market after the expiration of the lock-up agreements described in “Underwriting,” taking into account the provisions of Rules 144 and 701 under the Securities Act.
Rule 144
Under Rule 144, persons who became the beneficial owner of our ordinary shares prior to the completion of this offering may not sell their shares until the earlier of (1) the expiration of a six-month holding period, if we have been subject to the reporting requirements of the Securities Exchange Act of 1934 (the “Exchange Act”) and have filed all required reports for at least 90 days prior to the date of the sale, or (2) a one-year holding period.
At the expiration of the six-month holding period, a person who was not one of our affiliates at any time during the three months preceding a sale would be entitled to sell an unlimited number of ordinary shares provided current public information about us is available, and a person who was one of our affiliates at any time during the three months preceding a sale would be entitled to sell within any three-month period only a number of ordinary shares that does not exceed the greater of either of the following:
 
 	•	 	1% of the number of our ordinary shares then outstanding, which will equal approximately 728,495 shares immediately after this offering, based on the number of our ordinary shares outstanding as of September 3, 2014; or	
 
 	•	 	the average weekly trading volume of our ordinary shares on the New York Stock Exchange during the four calendar weeks preceding the filing with the SEC of a notice on Form 144 with respect to the sale.	
At the expiration of the one-year holding period, a person who was not one of our affiliates at any time during the three months preceding a sale would be entitled to sell an unlimited number of our ordinary shares without restriction. A person who was one of our affiliates at any time during the three months preceding a sale would remain subject to the volume restrictions described above.
Sales under Rule 144 by our affiliates are also subject to manner of sale provisions and notice requirements and to the availability of current public information about us.
 
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Rule 701
In general, under Rule 701, any of our associates, directors, officers, consultants or advisors who purchased shares from us in connection with a compensatory stock or option plan or other written agreement before the effective date of this offering, or who purchased shares from us after that date upon the exercise of options granted before that date, are eligible to resell such shares in reliance upon Rule 144 beginning 90 days after the date of this prospectus. If such person is not an affiliate, the sale may be made subject only to the manner-of-sale restrictions of Rule 144. If such a person is an affiliate, the sale may be made under Rule 144 without compliance with its one-year minimum holding period, but subject to the other Rule 144 restrictions.
Lock-Up Agreements
We, each of our officers and directors and the selling shareholder have agreed with the underwriters, subject to certain exceptions, not to dispose of or hedge any of the ordinary shares or securities convertible into or exchangeable for, or that represent the right to receive, ordinary shares during the period from the date of the underwriting agreement to be executed by us in connection with this offering continuing through the date that is 180 days after the date of the underwriting agreement, except with the prior written consent of Morgan Stanley & Co. LLC and either of Credit Suisse Securities (USA) LLC or Itau BBA USA Securities, Inc. See “Underwriting.”
 
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 MATERIAL TAX CONSIDERATIONS
Material United States Federal Income Tax Considerations
Subject to the limitations and qualifications stated herein, this discussion sets forth the material U.S. federal income tax consequences to U.S. Holders (as defined below) of the purchase, ownership and disposition of the ordinary shares. The discussion is based on the U.S. Internal Revenue Code of 1986, as amended, its legislative history, existing and proposed regulations thereunder, published rulings and court decisions, all as currently in effect and all subject to change at any time, possibly with retroactive effect.
This discussion addresses only those persons that acquire their ordinary shares in this offering and that hold those ordinary shares as capital assets and does not address the tax consequences to any special class of holders, including without limitation, holders (directly, indirectly or constructively) of 5% or more of our shares, dealers in securities or currencies, banks, tax-exempt organizations, life insurance companies, financial institutions, broker-dealers, regulated investment companies, real estate investment trusts, traders in securities that elect the mark-to-market method of accounting for their securities holdings, persons that hold securities that are a hedge or that are hedged against currency or interest rate risks or that are part of a straddle, conversion or “integrated” transaction, U.S. expatriates, S corporations, partnerships or other entities classified as partnerships for U.S. federal income tax purposes, persons that are resident or ordinarily resident in or have a permanent establishment in a jurisdiction outside the United States, persons who acquired our ordinary shares pursuant to the exercise of any employee share option or otherwise as compensation, and U.S. Holders whose functional currency for U.S. federal income tax purposes is not the U.S. dollar. This discussion does not address the effect of the U.S. federal alternative minimum tax, or U.S. federal estate and gift tax, or any state, local or foreign tax laws on a holder of ordinary shares, nor does it address the Medicare contribution tax on net investment income.
For purposes of this discussion, a “U.S. Holder” is a beneficial owner of ordinary shares that is for U.S. federal income tax purposes: (a) an individual who is a citizen or resident of the U.S.; (b) a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the U.S., any state thereof or the District of Columbia; (c) an estate the income of which is subject to U.S. federal income taxation regardless of its source; or (d) a trust (i) if a court within the U.S. can exercise primary supervision over its administration, and one or more U.S. persons have the authority to control all of the substantial decisions of that trust, or (ii) that was in existence on August 20, 1996 and validly elected under applicable Treasury Regulations to continue to be treated as a domestic trust.
If a partnership or an entity or arrangement that is treated as a partnership for U.S. federal income tax purposes holds our ordinary shares, the tax treatment of a partner will generally depend upon the status of the partner and the activities of the partnership. Partners in partnerships that hold our ordinary shares should consult their tax advisors.
You are Urged to Consult Your Own Independent Tax Advisor Regarding the Specified U.S. Federal, State, Local and Foreign Income and Other Tax Considerations Relating to the Acquisition, Ownership and Disposition of Our Ordinary Shares.
Cash Dividends and Other Distributions
A U.S. Holder of ordinary shares generally will be required to treat distributions received with respect to such ordinary shares (including any amounts withheld pursuant to Luxembourg tax law) as dividend income to the extent of our current or accumulated earnings and profits (computed using U.S. federal income tax principles), with the excess treated as a non-taxable return of capital to the extent of the holder’s adjusted tax basis in the ordinary shares and, thereafter, as capital gain, subject to the passive foreign investment company, or “PFIC,” rules discussed below. Because we do not maintain calculations of earnings and profits under U.S. federal income tax principles, a U.S. Holder should expect to treat all cash distributions as dividends for such purposes. Dividends paid on the ordinary shares will not be eligible for the dividends received deduction allowed to U.S. corporations.
 
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With respect to certain non-corporate U.S. Holders (including individuals), dividends will be taxed at the lower capital gains rate applicable to “qualified dividend income,” provided that (1) our ordinary shares are readily tradable on an established securities market in the United States, (2) we are neither a PFIC (as defined below) nor treated as such with respect to the U.S. Holder for the taxable year in which the dividend is paid and the preceding taxable year, and (3) certain holding period requirements are met. Under U.S. Internal Revenue Service authority, common or ordinary shares generally are considered to be readily tradable on an established securities market in the United States for purposes of clause (1) above if they are listed on the New York Stock Exchange, as our ordinary shares are expected to be. A U.S. Holder should consult its tax advisor regarding the availability of the lower tax rate applicable to qualified dividend income for any dividends we pay with respect to our ordinary shares, as well as the effect of any change in applicable law after the date of this prospectus.
Distributions paid in a currency other than U.S. dollars will be included in a U.S. Holder’s gross income in a U.S. dollar amount based on the spot exchange rate in effect on the date of actual or constructive receipt, whether or not the payment is converted into U.S. dollars at that time. The U.S. Holder will have a tax basis in such currency equal to such U.S. dollar amount, and any gain or loss recognized upon a subsequent sale or conversion of the foreign currency for a different U.S. dollar amount will be U.S. source ordinary income or loss. If the dividend is converted into U.S. dollars on the date of receipt, a U.S. Holder generally should not be required to recognize foreign currency gain or loss in respect of the dividend income.
A U.S. Holder who pays (whether directly or through withholding) Luxembourg income tax with respect to dividends paid on our ordinary shares generally will be entitled to receive either a deduction or a foreign tax credit for such Luxembourg income tax paid. Complex limitations apply to the foreign tax credit, including the general limitation that the credit cannot exceed the proportionate share of a U.S. Holder’s U.S. federal income tax liability that such U.S. Holder’s “foreign source” taxable income bears to such U.S. Holder’s worldwide taxable income. In applying this limitation, a U.S. Holder’s various items of income and deduction must be classified, under complex rules, as either “foreign source” or “U.S. source.” In addition, this limitation is calculated separately with respect to specific categories of income. Dividends paid by us generally will constitute “foreign source” income and generally will be categorized as “passive category income.” Because the foreign tax credit rules are complex, each U.S. Holder should consult its own tax advisor regarding the foreign tax credit rules.
Sale or Disposition of Ordinary Shares
A U.S. Holder generally will recognize gain or loss on the taxable sale or exchange of the ordinary shares in an amount equal to the difference between the U.S. dollar amount realized on such sale or exchange (determined in the case of shares sold or exchanged for currencies other than U.S. dollars by reference to the spot exchange rate in effect on the date of the sale or exchange or, if the ordinary shares sold or exchanged are traded on an established securities market and the U.S. Holder is a cash basis taxpayer or an electing accrual basis taxpayer, the spot exchange rate in effect on the settlement date) and the U.S. Holder’s adjusted tax basis in the ordinary shares determined in U.S. dollars. The initial tax basis of the ordinary shares to a U.S. Holder will be the U.S. Holder’s U.S. dollar purchase price for the shares (determined by reference to the spot exchange rate in effect on the date of the purchase, or if the shares purchased are traded on an established securities market and the U.S. Holder is a cash basis taxpayer or an electing accrual basis taxpayer, the spot exchange rate in effect on the settlement date).
Subject to the PFIC rules discussed below, any such gain or loss generally will be U.S. source gain or loss for U.S. foreign tax credit purposes and will be treated as long-term capital gain or loss if the U.S. Holder’s holding period in our ordinary shares exceeds one year. Non-corporate U.S. Holders (including individuals) generally will be subject to U.S. federal income tax on long-term capital gain at preferential rates. The deductibility of capital losses is subject to significant limitations.
 
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Potential Application of Passive Foreign Investment Company Provisions
We do not currently expect to be treated as a PFIC for U.S. federal income tax purposes with respect to our taxable year ending December 31, 2013. Our actual PFIC status for the current taxable year will not be determinable until the close of such year, and, accordingly, there is no guarantee that we will not be a PFIC for the current taxable year. A non-U.S. corporation is considered to be a PFIC for any taxable year if either:
 
 	•	 	at least 75% of its gross income is passive income (the “income test”); or	
 
 	•	 	at least 50% of the value of its assets (based on an average of the quarterly values of the assets during a taxable year) is attributable to assets that produce or are held for the production of passive income (the “asset test”).	
Given the types of assets owned by us and our subsidiaries and the type of income earned by us and our subsidiaries, we will be treated as owning our proportionate share of the assets and earning our proportionate share of the income of any other corporation in which we own, directly or indirectly, 25% or more (by value) of the corporation’s stock. Subject to various exceptions, passive income generally includes dividends, interest, rents, royalties and gains from the disposition of assets that produce or are held for the production of passive income.
We must make a separate determination each year as to whether we are a PFIC. As a result, our PFIC status may change. If we are a PFIC for any taxable year during which a U.S. Holder holds ordinary shares, we generally will continue to be treated as a PFIC for all succeeding years during which a U.S. Holder holds the ordinary shares. However, if we cease to be a PFIC, a U.S. Holder may avoid some of the adverse effects of the PFIC regime thereafter by making a “deemed sale” election with respect to the ordinary shares, as applicable.
If we are or become a PFIC in a taxable year in which we pay a dividend or the prior taxable year, the reduced “qualified dividend income” rate discussed above with respect to dividends paid to non-corporate holders would not apply. In addition, if we are a PFIC for any taxable year during which a U.S. Holder holds ordinary shares, the U.S. Holder will be subject to special tax rules with respect to any “excess distribution” that the U.S. Holder receives and any gain the U.S. Holder realizes from a sale or other disposition (including a pledge or a deemed disposition) of the ordinary shares, unless the U.S. Holder makes a “mark-to-market” election as discussed below. Distributions the U.S. Holder receives in a taxable year that are greater than 125% of the average annual distributions the U.S. Holder received during the shorter of the three preceding taxable years or the U.S. Holder’s holding period for the ordinary shares will be treated as an excess distribution. Under these special tax rules:
 
 	•	 	the excess distribution or gain from a sale or other disposition will be allocated ratably over the U.S. Holder’s holding period for the ordinary shares;	
 
 	•	 	the amount allocated to the current taxable year, and any taxable year prior to the first taxable year in which the Company became a PFIC, will be treated as ordinary income; and	
 
 	•	 	the amount allocated to each other year will be subject to the highest tax rate in effect for that year and the interest charge generally applicable to underpayments of tax will be imposed on the resulting tax attributable to each such year.	
The tax liability for amounts allocated to years prior to the year of disposition or “excess distribution” cannot be offset by any net operating losses for such years, and gains (but not losses) realized on the sale of the ordinary shares cannot be treated as capital, even if you hold the ordinary shares as capital assets. Special foreign tax credit rules apply with respect to excess distributions. Please consult your own tax advisor with respect to such rules.
We do not intend to prepare or provide the information that would enable you to make a “qualified electing fund” election, which, if available, would result in tax treatment different from the general tax treatment for PFICs described above.
 
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Alternatively, a U.S. Holder of “marketable stock” (as defined below) of a PFIC may make a mark-to-market election with respect to such stock to elect out of the tax treatment discussed above. If a U.S. Holder makes a valid mark-to-market election for the ordinary shares the U.S. Holder will include in income each year an amount equal to the excess, if any, of the fair market value of the ordinary shares as of the close of the U.S. Holder’s taxable year over the U.S. Holder’s adjusted basis in such ordinary shares. A U.S. Holder is allowed a deduction for the excess, if any, of the adjusted basis of the ordinary shares over their fair market value as of the close of the taxable year. However, deductions are allowable only to the extent of any net mark-to-market gains on the ordinary shares included in your income for prior taxable years. Amounts included in the U.S. Holder’s income under a mark-to-market election, as well as gain on the actual sale or other disposition of the ordinary shares, are treated as ordinary income. Ordinary loss treatment also applies to the deductible portion of any mark-to-market loss on the ordinary shares, as well as to any loss realized on the actual sale or disposition of the ordinary shares, to the extent that the amount of such loss does not exceed the net mark-to-market gains previously included for such ordinary shares. The U.S. Holder’s basis in the ordinary shares will be adjusted to reflect any such income or loss amounts. If a U.S. Holder makes such an election, the tax rules that apply to distributions by corporations that are not PFICs would apply to distributions by us, except that the reduced “qualified dividend income” rate discussed above under “—Cash Dividends and Other Distributions” would not apply.
The mark-to-market election is available only for “marketable stock,” which is stock that is traded in other than de minimis quantities on at least 15 days during each calendar quarter (“regularly traded”) on a qualified exchange or other market, as defined in applicable U.S. Treasury regulations. We expect that our ordinary shares will be listed on the New York Stock Exchange, which is a qualified exchange for these purposes. Special rules apply in determining whether stock of PFIC is regularly traded in the context of an initial public offering. In addition, any mark-to-market election with respect to our ordinary shares will not apply to any PFIC subsidiary that we own. Accordingly, any direct or indirect disposition of the stock of, or any distribution by, a PFIC subsidiary will be subject to tax under the general PFIC rules described above. Please consult your own tax advisor with respect to such rules.
If you own our ordinary shares during any taxable year that we are a PFIC, you must file an annual report with the IRS. You are urged to consult your tax advisor concerning the U.S. federal income tax consequences of purchasing, holding, and disposing of our ordinary shares if we are or become a PFIC, including the possibility of making a mark-to-market election.
U.S. Information Reporting and Backup Withholding
Dividend payments with respect to our ordinary shares and proceeds from the sale, exchange or redemption of our ordinary shares may be subject to information reporting to the U.S. Internal Revenue Service and possible U.S. backup withholding. Backup withholding will not apply, however, to a U.S. Holder who furnishes a correct taxpayer identification number and makes any other required certification or who is otherwise exempt from backup withholding. U.S. Holders who are required to establish their exempt status may be required to provide such certification on U.S. Internal Revenue Service Form W-9. U.S. Holders should consult their tax advisors regarding the application of the U.S. information reporting and backup withholding rules.
Backup withholding is not an additional tax. Amounts withheld as backup withholding may be credited against a U.S. Holder’s U.S. federal income tax liability, and such holder may obtain a refund of any excess amounts withheld under the backup withholding rules by timely filing the appropriate claim for refund with the U.S. Internal Revenue Service and furnishing any required information.
Information With Respect to Foreign Financial Assets
Certain U.S. Holders who are individuals and certain entities may be required to report information relating to our ordinary shares, subject to certain exceptions (including an exception for ordinary shares held in accounts maintained by certain U.S. financial institutions). U.S. Holders should consult their tax advisors regarding their reporting obligations with respect to their ownership and disposition of our ordinary shares.
 
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THE ABOVE DISCUSSION DOES NOT COVER ALL TAX MATTERS THAT MAY BE OF IMPORTANCE TO A PARTICULAR INVESTOR. YOU ARE STRONGLY URGED TO CONSULT YOUR OWN TAX ADVISOR ABOUT THE TAX CONSEQUENCES TO YOU OF AN INVESTMENT IN THE ORDINARY SHARES.
Luxembourg Tax Considerations
The following is a summary discussion of the material Luxembourg tax considerations of the acquisition, ownership and disposition of your ordinary shares that may be applicable to you if you acquire our ordinary shares.
It is not intended to be, nor should it be construed to be, legal or tax advice. This discussion is based on Luxembourg laws and regulations as they stand on the date of this prospectus and is subject to any change in law or regulations or changes in interpretation or application thereof (and which may possibly have a retroactive effect). Prospective investors should therefore consult their own professional advisers as to the effects of state, local or foreign laws and regulations, including Luxembourg tax law and regulations, to which they may be subject.
As used herein, a “Luxembourg individual” means an individual resident in Luxembourg who is subject to personal income tax (impôt sur le revenu) on his or her worldwide income from Luxembourg or foreign sources, and a “Luxembourg corporate holder” means a company (that is, a fully taxable collectivité within the meaning of Article 159 of the Luxembourg Income Tax Law) resident in Luxembourg subject to corporate income tax (impôt sur le revenu des collectivités) on its worldwide income from Luxembourg or foreign sources. For purposes of this summary, Luxembourg individuals and Luxembourg corporate holders are collectively referred to as “Luxembourg Holders.” A “non-Luxembourg Holder” means any investor in shares of the Company other than a Luxembourg Holder.
Tax Regime Applicable to Capital Gains Realized Upon Disposal of Shares
Luxembourg Holders
Luxembourg individual holders. For Luxembourg individuals holding (together, directly or indirectly, with his or her spouse or civil partner or underage children) 10% or less of the share capital of the Company, capital gains will only be taxable if they are realized on a sale of shares, which takes place before their acquisition or within the first six months following their acquisition. The capital gain or liquidation proceeds will be taxed at progressive income tax rates (ranging from 0 to 43.6% in 2014).
For Luxembourg individuals holding (together with his/her spouse or civil partner and underage children) directly or indirectly more than 10% of the capital of the Company, capital gains will be taxable as follows:
 
 	•	 	within six months from the acquisition, the capital gain or liquidation proceeds will be taxed at progressive income tax rates (currently ranging from 0 to 43.6%).	
 
 	•	 	after six months the capital gain or the liquidation proceeds will be taxed at a reduced tax rate (i.e. half of the investor’s global tax rate). An allowance of €50,000 (doubled for taxpayers filing jointly), available during a ten-year period, is applicable.	
Luxembourg corporate holders. Capital gains realized upon the disposal of shares by a Luxembourg corporate holder will in principle be subject to corporate income tax and municipal business tax. The combined applicable rate (including an unemployment fund contribution) is 29.22% for the fiscal year ending 2014 for a Luxembourg corporate holder established in Luxembourg-City. An exemption from such taxes may be available to the Luxembourg corporate holder pursuant to article 166 of the Luxembourg Income Tax law subject to the fulfillment of the conditions set forth therein. The scope of the capital gains exemption may be limited in the cases provided by the Grand Ducal Decree of December 21, 2001.
 
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Non-Luxembourg Holders
Subject to any applicable tax treaty, an individual non-Luxembourg Holder of shares (who has no permanent establishment or permanent representative in Luxembourg to which the shares would be attributable) will only be subject to Luxembourg taxation on capital gains arising upon disposal of such shares if such holder has (together with his or her spouse or civil partner and underage children) directly or indirectly held more than 10% of the capital of the Company, at any time during the five years preceding the disposal, and either (i) such holder has been a resident of Luxembourg for tax purposes for at least 15 years and has become a non-resident within the five years preceding the realization of the gain, subject to any applicable tax treaty, or (ii) the disposal of shares occurs within six months from their acquisition (or prior to their actual acquisition). If we and a U.S. relevant holder are eligible for the benefits of the Convention between the Government of the Grand Duchy of Luxembourg and the Government of the United States for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital (the “Luxembourg-U.S. Treaty”), such U.S. relevant holder generally should not be subject to Luxembourg tax on the gain from the disposal of such shares unless such gain is attributable to a permanent establishment or permanent representative of such U.S. relevant holder in Luxembourg. Subject to any restrictions imposed by the substantially and regularly traded clause in the limitation on benefits article of the Luxembourg-U.S. treaty, we expect to be eligible for the benefits of the Luxembourg-U.S. Treaty.
A corporate non-Luxembourg Holder (that is, a collectivité within the meaning of Article 159 of the Luxembourg Income Tax Law), which has a permanent establishment or a permanent representative in Luxembourg to which shares would be attributable, will bear corporate income tax and municipal business tax on a gain realized on a disposal of such shares as set forth above for a Luxembourg corporate holder. In the same way, gains realized on the sale of the shares through a permanent establishment or a permanent representative may benefit from the full exemption provided for by Article 166 of the Luxembourg Income Tax Law and by the Grand Ducal Decree of December 21, 2001 subject in each case to fulfillment of the conditions set out therein.
A corporate non-Luxembourg Holder, which has no permanent establishment or permanent representative in Luxembourg to which the shares would be attributable will not be subject to any Luxembourg tax on a gain realized on a disposal of such shares unless such holder holds, directly or through tax transparent entities, more than 10% of the share capital of the Company, and the disposal of shares occurs within six months from their acquisition (or prior to their actual acquisition), subject to any applicable tax treaty. If we and a U.S. corporate holder without a permanent establishment in Luxembourg are eligible for the benefits of the Luxembourg-U.S. Treaty, such U.S. corporate holder generally should not be subject to Luxembourg tax on the gain from the disposal of such shares.
Tax Regime Applicable to Distributions
Withholding Tax . Dividend distributions by the Company are subject to a withholding tax of 15%. Distributions by the Company sourced from a reduction of capital as defined in Article 97 (3) of the Luxembourg Income Tax Law including, among others, share premium should not be subject to withholding tax provided no newly accumulated fiscal profits, or profit reserves carried forward are recognized by the Company on a standalone basis. We or the applicable paying agent will withhold on a distribution if required by applicable law.
Where a withholding needs to be applied, the rate of the withholding tax may be reduced pursuant to the double tax treaty existing between Luxembourg and the country of residence of the relevant holder, subject to the fulfillment of the conditions set forth therein. If we and a U.S. relevant holder are eligible for the benefits of the Luxembourg-U.S. Treaty, the rate of withholding on distributions generally is 15%, or 5% if the U.S. relevant holder is a beneficial owner that owns at least 10% of our voting stock.
No withholding tax applies if the distribution is made to (i) a Luxembourg resident corporate holder (that is, a fully taxable collectivité within the meaning of Article 159 of the Luxembourg Income Tax Law), (ii) a corporation which is resident of a Member State of the European Union and is referred to by article 2 of the
 
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Council Directive 2011/96/EU of November 30, 2011 on the common system of taxation applicable in the case of parent companies and subsidiaries of different member states, (iii) a corporation or a cooperative resident in Norway, Iceland or Liechtenstein and subject to a tax comparable to corporate income tax as provided by Luxembourg Income Tax Law, (iv) a corporation resident in Switzerland which is subject to corporate income tax in Switzerland without benefiting from an exemption, (v) a corporation subject to a tax comparable to corporate income tax as provided by Luxembourg Income Tax Law which is resident in a country that has concluded a tax treaty with Luxembourg and (vi) a Luxembourg permanent establishment of one of the above-mentioned categories, provided each time that at the date of payment, the holder has held or commits itself to continue to hold directly or through a tax transparent vehicle, during an uninterrupted period of at least twelve months, shares representing at least 10% of the share capital of the Company or which had an acquisition price of at least €1,200,000.
Non-Luxembourg Holders
Non-Luxembourg holders of the shares who have neither a permanent establishment nor a permanent representative in Luxembourg to which the shares would be attributable are not liable for any Luxembourg tax on dividends paid on the shares, other than a potential withholding tax as described above.
Net Wealth Tax
Luxembourg Holders . Luxembourg net wealth tax will not be levied on a Luxembourg Holder with respect to the shares held unless the Luxembourg Holder is an entity subject to net wealth tax in Luxembourg.
Net wealth tax is levied annually at the rate of 0.5% on the net wealth of enterprises resident in Luxembourg, as determined for net wealth tax purposes. The shares may be exempt from net wealth tax subject to the conditions set forth by Article 60 of the Law of October 16, 1934 on the valuation of assets (Bewertungsgesetz), as amended.
Non-Luxembourg Holders
Luxembourg net wealth tax will not be levied on a non-Luxembourg Holder with respect to the shares held unless the shares are attributable to an enterprise or part thereof which is carried on through a permanent establishment or a permanent representative in Luxembourg.
Stamp and Registration Taxes
No registration tax or stamp duty will be payable by a holder of shares in Luxembourg solely upon the disposal of shares or by sale or exchange.
Material Brazilian Tax Considerations
The following summary describes the material Brazilian tax considerations relating to an investment in ordinary shares by holders resident in Brazil. This summary is not meant to be a comprehensive and complete description of all Brazilian tax considerations that may be relevant for Brazilian resident holders.
This summary is based on Brazilian laws and regulations currently in force and as applied on the date of this prospectus, which are subject to change, possibly with retroactive effect. Prospective holders of ordinary shares should consult their own tax advisors to determine the Brazilian tax consequences to them of acquiring, holding and disposing of ordinary shares.
Dividends and Capital Gains
The foreign source dividends paid in connection with the ordinary shares to individuals resident in Brazil are taxed at progressive rates of up to 27.5% and must be paid by the beneficiary through the “Carnê-Leão”
 
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system, a form of collection by which the individual calculates and pays the income tax levied on earnings obtained from foreign sources. Such taxation is an advance payment of the individual income tax, which is annually ascertained by the beneficiary in his/her income tax return.
Capital gains derived from the disposal of the ordinary shares by individuals resident in Brazil are taxed at a rate of 15% on the excess of the sales price over the acquisition cost of such shares, except for capital gains arising from disposals which selling price does not exceed the amount of R$35,000.00, which are exempt from taxation. The taxation is final and cannot be deducted from the income tax due by the beneficiary at the end of the year. The capital gains tax should be calculated and paid by the participant beneficiary until the last business day of the month following that when the taxable event took place.
The methodology to compute the capital gains related to the ordinary shares varies according to whether the income out of which the shares acquired by the participant was originally earned: (i) in Brazilian Reais (R$), (ii) in foreign currency, or (iii) partially in R$ and partially in foreign currency.
 
 	(i)	if the ordinary shares are acquired with income originally earned in R$, the capital gain will correspond to the positive difference between the sales price, converted into R$, and the amount originally invested, also converted into R$. Specific rules apply as to the exchange rates to be used for the conversion;	
 
 	(ii)	if the ordinary shares are acquired with income originally earned in foreign currency, the capital gain will correspond to the positive difference, in U.S. Dollars, between the sales price and the amount originally invested in foreign currency. This difference must be converted into R$ by means of the use of the quotation for the purchase of U.S. Dollars released by the Brazilian Central Bank for the date of receipt of the funds abroad. Therefore, any exchange currency fluctuation on the acquisition cost will not have any effect on the computation of the gain; and	
 
 	(iii)	if the ordinary shares are acquired with income originally earned partially in R$ and partially in foreign currency in the ascertainment of capital gains, the amount resulting from the sale and the amount originally invested must be compared in accordance with the rules previously mentioned, proportionally to the percentage invested with income originally earned in R$ and originally earned in foreign currency.	
If the holder is an entity, the dividends paid in connection with or capital gains derived from the disposal of the ordinary shares will be included in the holder’s taxable income for income tax purposes. Such an addition could result in taxation of such distributions at a rate of 34% (combined rate of the corporate income tax—IRPJ and social contribution on net income—CSLL), except for financial institutions which are subject to an increased rate of 40%, unless the entity has net operating losses in an amount which would be sufficient to offset the increase in the taxable basis represented by the capital gains.
Taxes Paid Abroad
To the extent that there is a convention for the avoidance of double taxation or there is reciprocity in treatment, both Brazilian individuals and legal entities are allowed to recognize a foreign tax credit with respect to foreign taxes paid on dividends and capital gains. Such foreign tax credit can be used to offset the Brazilian tax liability on such dividends and capital gains up to the limit of the taxes due as per the Brazilian tax laws and regulations.
Other Taxes
Brazilian law imposes a tax on foreign exchange transactions (IOF FX Tax) due on the conversion of Reais into foreign currency and vice versa. The current applicable rate for almost all foreign exchange transactions, including the foreign exchange transactions related to (i) the remittance of the purchase price to acquire the ordinary shares, and (ii) the repatriation of the funds related to the ordinary shares (both inflow of dividends and/
 
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or sales price) is 0.38%. The Brazilian government may increase at any time the rate of the IOF FX Tax to a maximum rate of 25.0% of the amount of the foreign exchange transaction, but such increase would apply only to future transactions.
Material Spanish Tax Considerations
The following summary describes the material Spanish tax considerations relating to an investment in ordinary shares by holders residents in Spain. This summary does not purport to be a comprehensive discussion of all Spanish tax considerations that may be relevant to a holder tax resident in Spain. In particular, this summary does not consider any specific facts or circumstances that may apply to a particular investor. Accordingly, it refers only to the general Spanish regulations, without addressing the specific regulations that may apply, for instance, depending on the particular autonomous region or autonomous city within Spain where the investor is resident for tax purposes.
This summary is based on Spanish laws and regulations currently in force and as applied on the date of this prospectus, which may be subject to changes. Prospective Spanish holders of ordinary shares should consult their own tax advisors to determine the tax consequences to them of acquiring, holding and disposing of ordinary shares.
For the purpose of the material Spanish tax consequences described herein, it is assumed that a prospective holder of ordinary shares will hold, either directly or indirectly, less than 5% of the share capital in the Company, and that such holder is not subject to any special tax regime. Also, in the case of Spanish corporate holders (“Corporate Holders”), it is assumed that the financial year of Corporate Holders has started after 31 December 2013.
Income Tax
Assuming that ordinary shares would be characterized as shares in a corporation for Spanish tax purposes, the following tax regime would apply to tax residents in Spain:
 
 	•	 	Cash dividends or equivalent cash distributions paid by the Company to Corporate Holders, and duly recognized for accounting purposes in the P&L account, shall be included in the aggregate taxable income of such holders, subject to Corporate Income Tax (“CIT”) currently at a 30% flat rate.	
If those dividends were subject to US withholding tax, Corporate Holders would be allowed to deduct from their annual CIT liability the lower of (i) the actual amount paid at source due to a tax of identical or analogous nature to CIT or to Spanish Non–Resident Income Tax (“NRIT”), which shall not exceed the maximum amount allowed to be taxed in the United States under the US-Spain Tax Treaty or (ii) the amount of tax effectively due in Spain on said dividends.
 
 	•	 	Cash dividends or equivalent cash distributions paid by the Company to Spanish tax resident individuals holding ordinary shares (“Individual Holders”) would be subject to Individual Income Tax (“IIT”) as “investment income,” at a tax scale ranging from 21% (for annual total “investment income” obtained by the Individual Holder up to €6,000), 25% (for annual total “investment income” obtained by the Individual Holder between €6,000 and €24,000), to 27% (for annual total “investment income” obtained by the Individual Holder in excess of €24,000). Dividends received may be exempt up to €1,500 annually, provided that certain conditions apply.	
If those dividends were subject to withholding tax in the US, Individual Holders would be allowed to deduct from their annual IIT liability the lower of (i) the actual amount paid at source due to a tax of identical or analogous nature to IIT or to NRIT, which shall not exceed the maximum amount allowed to be taxed in the United States under the US-Spain Tax Treaty; or (ii) the amount of tax effectively due in Spain on said dividends.
If dividends were paid through a Spanish paying agent, such agent must deduct from such dividend payments a 21% withholding tax as prepayment of the Spanish Individual Holders’ IIT liability.
 
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 	•	 	The delivery by the Company of newly-issued ordinary shares to Corporate or Individual Holders under a “scrip-dividend” scheme shall not be considered as income for Spanish CIT or IIT purposes. The acquisition cost, both of the new ordinary shares received and of the ordinary shares from which they arise, will be the result of dividing the total cost by the applicable number of ordinary shares, both old and new. The acquisition date of the new ordinary shares shall be that of the ordinary shares from which they arise.	
Capital gains derived from the sale of ordinary shares would be subject to the following regime:
 
 	•	 	Capital gains realized by Corporate Holders on ordinary shares will be regarded as taxable income on an accrual basis based on the income recognized in their P&L account adjusted in accordance with the rules contained in the CIT Law, and taxed at the ordinary CIT 30% rate. Capital losses incurred by Corporate Holders in relation to ordinary shares, adjusted in accordance with the rules contained in the CIT Law, would be deductible for CIT purposes.	
If capital gains were subject to US withholding tax, Corporate Holders would be allowed to deduct from their CIT liability the lower of (i) the actual amount paid at source due to a tax of identical or analogous nature to CIT or to NRIT, or (ii) the amount of tax effectively due in Spain on said capital gains.
 
 	•	 	Sale of ordinary shares by Individual Holders may give rise to a taxable capital gain or a tax deductible capital loss to be included in such Individual Holder’s IIT taxable income. Such gain or loss shall be calculated by the difference between the transfer value of ordinary shares, as established under IIT Law, and their acquisition value.	
Capital gains obtained by Individual Holders upon sale of ordinary shares held for more than one year will be subject to IIT as “investment income,” at a tax scale ranging from 21% (for the annual total “investment income” obtained by the Individual Holder up to €6,000), 25% (for the annual total “investment income” obtained by the Individual Holder between €6,000 and €24,000), to 27% (for the annual total “investment income” obtained by the Individual Holder in excess of €24,000).
Capital gains obtained by Individual Holders upon sale of ordinary shares held for less than a year will be subject to IIT as “general income,” at the IIT general tax scale, ranging from 24,75% to 52% (for annual total “general income” obtained by Individual Holders in excess of €300,000).
Capital losses may offset similar capital gains arising in the same tax year, and the following four years (i.e. capital losses derived from the sale of ordinary shares held for more than one year shall only offset capital gains derived from the sale of ordinary shares held for more than one year).
If capital gains were subject to US withholding tax, Individual Holders would be allowed to deduct from their IIT liability the lower of (i) the actual amount paid at source due to a tax of identical or analogous nature to IIT or to NRIT, or (ii) the amount of tax effectively due in Spain on said capital gains.
Transfer Tax, Stamp Duty and Capital Duty
Transfers of ordinary shares will be exempt from any Spanish Transfer Tax or Value Added Tax. Additionally, no Spanish Stamp Duty will be levied on such transfers.
Income Tax
The Spanish income tax treatment applicable to Spanish resident holders of ordinary shares depends upon our characterization for Spanish tax purposes. In this respect, we could be characterized legally as either (i) a corporation or (ii) a foreign entity with a similar or analogous nature to that of a Spanish pass-through entity (Entidad en Regimen de Atribución de Rentas).
 
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Characterization of the Company as a Corporation—Dividend Taxation. If ordinary shares are characterized as shares in a corporation for Spanish tax purposes, profits distributed on ordinary shares received by Spanish tax residents would be subject to the following regime:
 
 	•	 	Dividends paid by us to Corporate Holders and duly recognized for accounting purposes in the P&L account will form part of the aggregate taxable income of such holders, subject to corporate income tax (“CIT”) currently at a 30% rate.	
 
 	•	 	If dividends paid by us to Corporate Holders are subject to U.S. withholding tax, such Corporate Holders would be allowed to deduct from their annual CIT liability the lower of (i) the actual amount paid at source due to a tax of identical or analogous nature to CIT or to Spanish Non–Resident Income Tax (“NRIT”) ( i.e., withholding tax), which shall not exceed the maximum amount allowed to be taxed in the United States under the U.S.-Spain Double Tax Treaty (the “U.S.-Spain Treaty”) or (ii) the amount of tax which would have been payable had such income been realized in Spain.	
 
 	•	 	Dividends paid by a non-resident company, such as the Company, to Spanish tax resident individuals holding ordinary shares (“Individual Holders”) would be subject to Individual Income Tax (“IIT”) at a rate of 19% (in respect of the first €6,000 of any income received by the Individual Holder) and of 21% (in respect of the income exceeding such €6,000). The first €1,500 of any dividends received annually may be exempt under certain circumstances.	
 
 	•	 	If dividends paid by us to Individual Holders are subject to U.S. withholding tax, such Individual Holder would be allowed to deduct from his or her annual IIT liability the lower of (i) the actual amount paid at source due to a tax of identical or analogous nature to IIT or to NRIT ( i.e., withholding tax), which shall not exceed the maximum amount allowed to be taxed in the United States under the U.S.-Spain Treaty; or (ii) the result of applying the Spanish effective average tax rate to the portion of the net tax base taxed abroad.	
 
 	•	 	If the dividends are paid through a Spanish paying agent, such agent must withhold from such dividend payments a 19% withholding tax as prepayment of the Spanish Individual Holder’s final IIT liability.	
Characterization of the Company as a Corporation—Capital Gain Taxation. If ordinary shares are characterized as shares in a corporation for Spanish tax purposes, capital gains derived from ordinary shares would be subject to the following regime:
 
 	•	 	Capital gains realized by a Corporate Holder upon holding or disposing of ordinary shares will be regarded as taxable income on an accrual basis based on the income recognized in its P&L account adjusted in accordance with the rules contained in the CIT Law and, therefore, subject to CIT and taxed at the ordinary CIT 30% rate.	
 
 	•	 	If the capital gains are subject to U.S. withholding tax, the Corporate Holder would be allowed to deduct from its annual CIT liability the lower of (i) the actual amount paid at source due to a tax of identical or analogous nature to CIT or to NRIT ( i.e., withholding tax), which shall not exceed the maximum amount allowed to be taxed in the United States under the U.S.-Spain Treaty or (ii) the amount of tax which would have been payable had such income been realized in Spain.	
 
 	•	 	Capital losses incurred by the Corporate Holder in relation to ordinary shares based on the loss recognized in its P&L account adjusted in accordance with the rules contained in the CIT Law would be deductible for CIT purposes.	
 
 	•	 	Disposal of ordinary shares by an Individual Holder may give rise to a taxable capital gain or a tax deductible capital loss to be included in such Individual Holder’s IIT taxable income.	
 
 	•	 	Such gain or loss shall be calculated by reference to the difference between the transfer value of ordinary shares, as established under IIT Law, and their acquisition value.	
 
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 	•	 	Capital gains obtained by an Individual Holder upon disposal of ordinary shares will be taxed at a rate of 19% (in respect of the first €6,000 of any income received by the Individual Holder) and 21% (in respect of the income exceeding such €6,000).	
 
 	•	 	Capital losses may be offset against capital gains arising in the same taxable year. Outstanding capital losses can be carried forward and offset against capital gains arising in the same part of the taxable income base during the following four years.	
 
 	•	 	If the capital gains are subject to U.S. withholding tax, the Individual Holder would be allowed to deduct from its IIT liability the lower of (i) the actual amount paid at source due to a tax of identical or analogous nature to IIT or to NRIT ( i.e., withholding tax), which shall not exceed the maximum amount allowed to be taxed in the United States under the U.S.-Spain Treaty or (ii) the result of applying the Spanish effective average tax rate to the portion of the net tax base taxed abroad.	
Characterization of the Company as a Foreign Pass-Through Entity (Entidad en Regimen de Atribución de Rentas). If the Company is characterized as a foreign pass-through entity for Spanish tax purposes, Spanish holders of ordinary shares would be treated as follows:
 
 	•	 	Any items of income or capital gains realized by the Company would be allocated to Spanish holders of ordinary shares in proportion to such holders’ interests in the Company, even if such holders have not received any distributions. Therefore, the amount of the taxable income of Spanish holders of ordinary shares may exceed the cash distributions. In particular (i) cash distributions made by the Company would not be taxable to Spanish holders of ordinary shares; and (ii) in the case of Corporate Holders, amounts which may be recognized in the P&L account as a result of a change in value of the ordinary shares should not be included in the CIT taxable income; in both cases, to the extent that such amounts (the cash distributions or the changes in value, respectively) correspond to allocated income.	
 
 	•	 	The characterization of the items of income and capital gains realized by the Company would be maintained upon allocation to Spanish holders of ordinary shares. Determination of the taxable income to be allocated to Spanish holders of ordinary shares would generally be made according to the IIT rules, regardless of whether such holders are individuals or corporations.	
 
 	•	 	The tax rate applicable to income and capital gain allocated to Corporate Holders would be 30%, while the tax rate applicable to income allocated to Individual Holders would depend on the nature of the income allocated. If the income allocated to Individual Holders qualifies as dividend, interest or capital gain income, the applicable tax rate would be 19% (in respect of the first €6,000 of any income received by the Individual Holder) and 21% (in respect of the income exceeding such €6,000).	
 
 	•	 	If the income or capital gain allocated to Spanish holders of ordinary shares is subject to withholding tax outside of Spain, such holders would be allowed to deduct this withholding tax from their Spanish income tax liability, subject to the terms and restrictions set forth in the above paragraphs regarding Corporate Holders and Individual Holders.	
 
 	•	 	Disposal of ordinary shares by Spanish holders may give rise to taxable capital gain or tax-deductible capital loss to be included in such holders’ taxable income, in accordance with the rules established under CIT Law (in the case of Corporate Holders) or under IIT Law (in the case of Individual Holders).	
 
 	•	 	In the case of Corporate Holders, we believe that the capital gains should be calculated by reference to the difference between the transfer value and the acquisition value of ordinary shares, and that for these purposes the acquisition value of transferred ordinary shares should be increased by the amount of the previous undistributed income allocations during the transferring holder’s holding period that are allocable to such transferred ordinary shares, although this is an unclear	
 
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 	issue which is not expressly stated in the law. Capital gains realized by Corporate Holders would be taxed at a flat rate of 30%. Capital losses would be deductible in accordance with the rules established under CIT Law.	
 
 	•	 	In the case of Individual Holders, such gain or loss would be calculated by reference to the difference between the transfer value and the acquisition value of ordinary shares. For these purposes, we also believe that the acquisition value of transferred ordinary shares should be increased by the amount of the previous undistributed income allocations during the transferring holder’s holding period that are allocable to such transferred ordinary shares, although this is not expressly stated in the law. Capital gains realized by Individual Holders would be taxed at a rate of 19% (in respect of the first €6,000 of any income received by the Individual Holder) and 21% (in respect of the income exceeding such €6,000). Capital losses would be deductible in accordance with the rules established under IIT Law.	
 
 	•	 	If the capital gain realized upon the disposal of ordinary shares is subject to withholding tax outside of Spain, Spanish holders would be allowed to deduct this withholding tax from their Spanish income tax liability, subject to the terms and restrictions set forth in the above paragraphs regarding Corporate Holders and Individual Holders.	
Prospective holders of ordinary shares should be aware of the risk that, for Spanish tax purposes, the Spanish tax authorities could disregard the Company and any of the companies, partnerships or entities in which the Company owns an interest, and could try to allocate to Spanish holders of ordinary shares any income or capital gain obtained by such a lower-tier entity before such entity makes distributions to the Company if (i) the lower-tier entity is characterized as a foreign pass-through entity for Spanish tax purposes and (ii) the interest in the lower-tier entity is held by the Company directly or through another lower-tier entity which is also deemed a foreign pass-through entity for Spanish tax purposes.
Transfer Tax, Stamp Duty and Capital Duty
Transfers of ordinary shares will be exempt from any Spanish Transfer Tax or Value Added Tax. Additionally, no Stamp Duty will be levied on such transfers.
 
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 UNDERWRITING
Under the terms and subject to the conditions in an underwriting agreement dated the date of this prospectus, the underwriters named below (collectively, the “underwriters”), for whom Morgan Stanley & Co. LLC, Credit Suisse Securities (USA) LLC and Itau BBA USA Securities, Inc. are acting as representatives (the “representatives”), have severally agreed to purchase, and we and the selling shareholder have agreed to sell to them, severally, the number of shares indicated below:

Name	  	Number of
Shares	 	
Morgan Stanley & Co. LLC	  				
Credit Suisse Securities (USA) LLC	  				
Itau BBA USA Securities, Inc.	  				
Merrill Lynch, Pierce, Fenner & Smith
                      Incorporated	  				
Banco Bradesco BBI S.A.	  				
Banco BTG Pactual S.A.—Cayman Branch	  				
Goldman, Sachs & Co.	  				
Santander Investment Securities Inc.	  				
Robert W. Baird & Co. Incorporated	  				
BBVA Securities Inc.	  				
	  	 	 	 	
Total	  	 	14,625,000	  	
	  	 	 	 	
The underwriters are offering the ordinary shares subject to their acceptance of the shares from us and subject to prior sale. The underwriting agreement provides that the obligations of the several underwriters to pay for and accept delivery of the ordinary shares offered by this prospectus are subject to the approval of certain legal matters by their counsel and to certain other conditions. The underwriters are obligated to take and pay for all of the ordinary shares offered by this prospectus if any such shares are taken. However, the underwriters are not required to take or pay for the shares covered by the underwriters’ option to purchase additional shares described below.
The underwriters initially propose to offer part of the ordinary shares directly to the public at the offering price listed on the cover page of this prospectus and part to certain dealers. After the initial offering of the ordinary shares, the offering price and other selling terms may from time to time be varied by the representatives. The offering of the shares by the underwriters is subject to receipt and acceptance and subject to the underwriters’ right to reject any order in whole or in part.
We and the selling shareholder have granted to the underwriters an option, exercisable for 30 days from the date of this prospectus, to purchase up to 2,193,750 additional ordinary shares at the public offering price listed on the cover page of this prospectus, less underwriting discounts and commissions. To the extent the option is exercised, each underwriter will become obligated, subject to certain conditions, to purchase about the same percentage of the additional ordinary shares as the number listed next to the underwriter’s name in the preceding table bears to the total number of ordinary shares listed next to the names of all underwriters in the preceding table.
 
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The following table shows the per share and total public offering price, underwriting discounts and commissions, and proceeds before expenses to us and the selling shareholder. These amounts are shown assuming both no exercise and full exercise of the underwriters’ option to purchase up to an additional              ordinary shares.

 	  	Per
Share	 	  	Total	 	
	  			  	No Exercise	 	  	Full Exercise	 	
Public offering price	  	$	            	  	  	$	            	  	  	$	            	  	
Underwriting discounts and commissions to be paid by:	  				  				  				
Us	  	$	 	  	  	$	 	  	  	$	 	  	
The selling shareholder	  	$	 	  	  	$	 	  	  	$	 	  	
Proceeds, before expenses, to us	  	$	 	  	  	$	 	  	  	$	 	  	
Proceeds, before expenses, to selling shareholder	  	$	 	  	  	$	 	  	  	$	 	  	
The estimated offering expenses including registration, filing and listing fees, printing fees, legal and accounting expenses, but excluding underwriting discounts and commissions, payable by us are approximately $9,803,660. We have agreed to reimburse the underwriters for out-of-pocket expenses and for certain expenses related to this offering in an amount up to $            . Such reimbursement is deemed to be underwriting compensation by the Financial Industry Regulatory Authority, Inc. (“FINRA”).
The underwriters have informed us that they do not intend sales to discretionary accounts to exceed 5% of the total number of ordinary shares offered by them.
Banco BTG Pactual S.A.—Cayman Branch is not a broker-dealer registered with the SEC, and therefore may not make sales of any securities in the United States or to U.S. persons except in compliance with applicable U.S. laws and regulations. To the extent that Banco BTG Pactual S.A.—Cayman Branch intends to effect sales of the Securities in the United States, it will do so only through BTG Pactual US Capital LLC or one or more U.S. registered broker-dealers, or otherwise as permitted by applicable U.S. law.
Banco Bradesco BBI S.A. is not a U.S. registered broker-dealer and therefore will not be selling or placing shares in the United States. However, Bradesco Securities Inc., an affiliate of Banco Bradesco BBI S.A., is a U.S. registered broker-dealer and will be acting as placement agent on behalf of Banco Bradesco BBI S.A. for the placement of shares to investors in the United States.
We intend to apply to list our ordinary shares under the trading symbol “ATTO.”
We and all directors and officers and the holders of 100% of our outstanding ordinary shares as of September 3, 2014 have agreed that, without the prior written consent of Morgan Stanley & Co. LLC and either of Credit Suisse Securities (USA) LLC or Itau BBA USA Securities, Inc. on behalf of the underwriters, we and they will not, during the period ending 180 days after the date of this prospectus (the “restricted period”):
 
 	•	 	offer, issue, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend or otherwise transfer or dispose of, directly or indirectly, any ordinary shares or any securities convertible into or exercisable or exchangeable for ordinary shares;	
 
 	•	 	file any registration statement with the Securities and Exchange Commission relating to the offering of any ordinary shares or any securities convertible into or exercisable or exchangeable for ordinary shares;	
 
 	•	 	enter into any swap, hedge or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the ordinary shares; or	
 
 	•	 	publicly disclose that we will or may enter into any of the transactions described above,	
 
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whether any such transaction is to be settled by delivery of ordinary shares or such other securities, in cash or otherwise. In addition, we and each such person agrees that, without the prior written consent of Morgan Stanley & Co. LLC and either of Credit Suisse Securities (USA) LLC or Itau BBA USA Securities, Inc. on behalf of the underwriters, we or such other person will not, during the restricted period, make any demand for, or exercise any right with respect to, the registration of any ordinary shares or any security convertible into or exercisable or exchangeable for ordinary shares.
The restrictions described in the immediately preceding paragraph do not apply to:
 
 	•	 	the issuance and sale of shares to the underwriters;	
 
 	•	 	the issuance by the Company of ordinary shares upon the exercise of an option or a warrant or the conversion of a security outstanding on the date of this prospectus of which the underwriters have been advised in writing; or	
 
 	•	 	transactions by any person other than us relating to ordinary shares or other securities acquired in open market transactions after the completion of the offering of the shares.	
The restricted period described in the preceding paragraph will be extended if:
 
 	•	 	during the last 17 days of the restricted period we issue an earnings release or material news event relating to us occurs; or	
 
 	•	 	prior to the expiration of the restricted period, we announce that we will release earnings results during the 16-day period beginning on the last day of the restricted period or provide notification to Morgan Stanley & Co. LLC and either of Credit Suisse Securities (USA) LLC or Itau BBA USA Securities, Inc., of any earnings release or material news or material event that may give rise to an extension of the initial restricted period, in which case the restrictions described in the preceding paragraph will continue to apply until the expiration of the 18-day period beginning on the issuance of the earnings release or the occurrence of the material news or material event, unless the representatives waive, in writing, such an extension.	
Morgan Stanley & Co. LLC and either of Credit Suisse Securities (USA) LLC or Itau BBA USA Securities, Inc., together in their sole discretion, may release the ordinary shares and other securities subject to the lock-up agreements described above in whole or in part at any time with or without notice.
In order to facilitate the offering of the ordinary shares, and subject to relevant market abuse regulations, the underwriters may engage in transactions that stabilize, maintain or otherwise affect the price of the ordinary shares. Specifically, the underwriters may sell more shares than they are obligated to purchase under the underwriting agreement, creating a short position. A short sale is covered if the short position is no greater than the number of shares available for purchase by the underwriters under their option to purchase additional shares. The underwriters can close out a covered short sale by exercising their option to purchase additional shares or purchasing shares in the open market. In determining the source of shares to close out a covered short sale, the underwriters will consider, among other things, the open market price of shares compared to the price available under their option to purchase additional shares. The underwriters may also sell shares in excess of their option to purchase additional shares, creating a naked short position. The underwriters must close out any naked short position by purchasing shares in the open market. A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of the ordinary shares in the open market after pricing that could adversely affect investors who purchase in this offering. As an additional means of facilitating this offering, the underwriters may bid for, and purchase, ordinary shares in the open market to stabilize the price of the ordinary shares. These activities may raise or maintain the market price of the ordinary shares above independent market levels or prevent or retard a decline in the market price of the ordinary shares. The underwriters are not required to engage in these activities and may end any of these activities at any time.
We and the selling shareholder have agreed to indemnify the several underwriters against certain liabilities, including liabilities under the Securities Act, or contribute to payments that the underwriters may be required to make in that respect.
 
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A prospectus in electronic format may be made available on websites maintained by one or more underwriters, or selling group members, if any, participating in this offering and one or more of the underwriters participating in this offering may distribute prospectuses electronically. The representatives may agree to allocate a number of ordinary shares to underwriters for sale to their online brokerage account holders. Internet distributions will be allocated by the representatives to underwriters that may make Internet distributions on the same basis as other allocations.
The underwriters and their respective affiliates are full service financial institutions engaged in various activities, which may include securities trading, commercial and investment banking, financial advisory, investment management, investment research, principal investment, hedging. financing and brokerage activities. Certain of the underwriters and their respective affiliates have, from time to time, performed, and may in the future perform, various financial advisory and investment banking services for us, for which they received or will receive customary fees and expenses.
In addition, in the ordinary course of their various business activities, the underwriters and their respective affiliates, officers, directors or employees may purchase, sell or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) and financial instruments (including, among others, bank loans, commodities, currencies and credit default swaps) for their own account and for the accounts of their customers and may at any time hold long and short positions in such securities and instruments. Such investment and securities activities may involve or relate to our assets, securities, instruments and/or persons and entities with relationships with us. The underwriters and their respective affiliates may also make investment recommendations or publish or express independent research views in respect of such assets, securities, instruments and/or persons and entities and may at any time hold, or recommend to clients that they acquire, long or short positions in such assets, securities, instruments and/or persons and entities.
Pricing of the Offering
Prior to this offering, there has been no public market for our ordinary shares. The initial public offering price was determined by negotiations between us and the representatives. Among the factors considered in determining the initial public offering price were our future prospects and those of our industry in general, our sales, earnings and certain other financial and operating information in recent periods, and the price-earnings ratios, price-sales ratios, market prices of securities, and certain financial and operating information of companies engaged in activities similar to ours.
Selling Restrictions
Argentina
This prospectus has not been registered with the Comisión Nacional de Valores and may not be offered publicly in Argentina. The prospectus may not be publicly distributed in Argentina. Neither we nor the underwriters will solicit the public in Argentina in connection with this prospectus.
Australia
This prospectus is not a formal disclosure document and has not been, nor will be, lodged with the Australian Securities and Investments Commission. It does not purport to contain all information that an investor or their professional advisers would expect to find in a prospectus or other disclosure document (as defined in the Corporations Act 2001 (Australia)) for the purposes of Part 6D.2 of the Corporations Act 2001 (Australia) or in a product disclosure statement for the purposes of Part 7.9 of the Corporations Act 2001 (Australia), in either case, in relation to the ordinary shares.
The shares are not being offered in Australia to “retail clients” as defined in sections 761G and 761GA of the Corporations Act 2001 (Australia). This offering is being made in Australia solely to “wholesale clients” for
 
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the purposes of section 761G of the Corporations Act 2001 (Australia) and, as such, no prospectus, product disclosure statement or other disclosure document in relation to the s ordinary shares has been, or will be, prepared.
This prospectus does not constitute an offer in Australia other than to persons who do not require disclosure under Part 6D.2 of the Corporations Act 2001 (Australia) and who are wholesale clients for the purposes of section 761G of the Corporations Act 2001 (Australia). By submitting an application for our shares, you represent and warrant to us that you are a person who does not require disclosure under Part 6D.2 and who is a wholesale client for the purposes of section 761G of the Corporations Act 2001 (Australia). If any recipient of this prospectus is not a wholesale client, no offer of, or invitation to apply for, our shares shall be deemed to be made to such recipient and no applications for our shares will be accepted from such recipient. Any offer to a recipient in Australia, and any agreement arising from acceptance of such offer, is personal and may only be accepted by the recipient. In addition, by applying for our ordinary shares you undertake to us that, for a period of 12 months from the date of issue of the shares, you will not transfer any interest in the shares to any person in Australia other than to a person who does not require disclosure under Part 6D.2 and who is a wholesale client.
Brazil
The offer of ordinary shares described in this prospectus will not be carried out by any means that would constitute a public offering in Brazil under Law No. 6,385, of December 7, 1976, as amended, and under CVM Rule ( Instrução ) No. 400, of December 29, 2003, as amended. The offer and sale of the shares have not been and will not be registered with the Comissão de Valores Mobiliários in Brazil. The shares have not been offered or sold, and will not be offered or sold in Brazil, except in circumstances that do not constitute a public offering or distribution under Brazilian laws and regulations.
Chile
The offer of the ordinary shares begins on September 12, 2014, and is governed by the General Rule ( Norma de Carácter General ) 336 of June 27, 2012, issued by the Chilean Superintendency of Securities and Insurance (“SVS”). The offer relates to securities not registered with the Securities Registry or the Registry of Foreign Securities of the SVS, so the shares are not subject to the oversight of the SVS. Since the shares are unregistered securities in Chile, we have no obligation to deliver in Chile public information regarding the shares. The shares may not be sold in a public offering in Chile unless they are registered in the Securities Registry or the Registry of Foreign Securities of the SVS.
La oferta de los valores comienza el 12 de Septiembre de 2014 y está acogida a la Norma de Carácter General 336 de fecha 27 de Junio de 2012 de la Superintendencia de Valores y Seguros de Chile. La oferta versa sobre valores no inscritos en el Registro de Valores o en el Registro de Valores Extranjeros que lleva la SVS, por lo que los valores no están sujetos a la fiscalización de dicho organismo. Por tratarse de valores no inscritos, no existe obligación por parte del emisor de entregar en Chile información pública respecto de los valores. Estos valores no pueden ser objeto de oferta pública a menos que sean inscritos en el Registro de Valores correspondiente.
Colombia
The ordinary shares have not been and will not be offered in Colombia through a public offering of securities pursuant to Colombian laws and regulations, nor will they be registered in the Colombian National Registry of Securities and Issuers or listed on a regulated securities trading system such as the Colombian Stock Exchange.
Dubai International Financial Center
This prospectus relates to an Exempt Offer in accordance with the Offered Securities Rules of the Dubai Financial Services Authority (“DFSA”). This prospectus is intended for distribution only to persons of a type
 
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specified in the Offered Securities Rules of the DFSA. It must not be delivered to, or relied on by, any other person. The DFSA has no responsibility for reviewing or verifying any documents in connection with Exempt Offers. The DFSA has not approved this prospectus nor taken steps to verify the information set forth herein and has no responsibility for the prospectus. The ordinary shares to which this prospectus relates may be illiquid and/or subject to restrictions on their resale. Prospective purchasers of the shares offered should conduct their own due diligence on the shares. If you do not understand the contents of this prospectus you should consult an authorized financial advisor.
European Economic Area
In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, a “Relevant Member State”) an offer to the public of any ordinary shares may not be made in that Relevant Member State, except that an offer to the public in that Relevant Member State of any ordinary shares may be made at any time under the following exemptions under the Prospectus Directive, if they have been implemented in that Relevant Member State:
 
 	(a)	 	to any legal entity which is a qualified investor as defined in the Prospectus Directive;	
 
 	(b)	 	to fewer than 100 or, if the Relevant Member State has implemented the relevant provision of the 2010 PD Amending Directive, 150, natural or legal persons (other than qualified investors as defined in the Prospectus Directive), as permitted under the Prospectus Directive, subject to obtaining the prior consent of the representatives for any such offer; or	
 
 	(c)	 	in any other circumstances falling within Article 3(2) of the Prospectus Directive, provided that no such offer of ordinary shares shall result in a requirement for the publication by us or any underwriter of a prospectus pursuant to Article 3 of the Prospectus Directive.	
For the purposes of this provision, the expression an “offer to the public” in relation to any ordinary shares in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and any ordinary shares to be offered so as to enable an investor to decide to purchase any ordinary shares, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State, the expression “Prospectus Directive” means Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State), and includes any relevant implementing measure in the Relevant Member State, and the expression “2010 PD Amending Directive” means Directive 2010/73/EU.
Hong Kong
The ordinary shares offered in this prospectus may not be offered or sold in Hong Kong by means of any document other than (i) in circumstances which do not constitute an offer to the public within the meaning of the Companies Ordinance (Cap. 32, Laws of Hong Kong), or (ii) to “professional investors” within the meaning of the Securities and Futures Ordinance (Cap. 571, Laws of Hong Kong) and any rules made thereunder, or (iii) in other circumstances which do not result in the document being a “prospectus” within the meaning of the Companies Ordinance (Cap. 32, Laws of Hong Kong) and no advertisement, invitation or document relating to the shares may be issued or may be in the possession of any person for the purpose of issue (in each case whether in Hong Kong or elsewhere), which is directed at, or the contents of which are likely to be accessed or read by, the public in Hong Kong (except if permitted to do so under the laws of Hong Kong) other than with respect to shares which are or are intended to be disposed of only to persons outside Hong Kong or only to “professional investors” within the meaning of the Securities and Futures Ordinance (Cap. 571, Laws of Hong Kong) and any rules made thereunder.
Japan
The ordinary shares offered in this prospectus have not been registered under the Securities and Exchange Law of Japan. Such shares have not been offered or sold and will not be offered or sold, directly or indirectly, in
 
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Japan or to or for the account of any resident of Japan, except (i) pursuant to an exemption from the registration requirements of the Securities and Exchange Law and (ii) in compliance with any other applicable requirements of Japanese law.
Kuwait
Unless all necessary approvals from the Kuwait Capital Markets Authority pursuant to Law No. 7/2010, its Executive Regulations and the various Resolutions and Announcements issued pursuant thereto or in connection therewith have been given in relation to the marketing, of and sale of the ordinary shares offered in this prospectus, these may not be offered for sale, nor sold in the State of Kuwait. Neither this prospectus nor any of the information contained herein is intended to lead to the conclusion of any contract of whatsoever nature within the State of Kuwait.
Mexico
The ordinary shares described in this prospectus are not being offered, sold or traded in Mexico pursuant to, and do not constitute, an oferta pública (public offering) in accordance with the Ley del Mercado de Valores , as amended (Mexican Securities Market Law, or “LMV”), or Disposiciones de carácter general aplicables a las emisoras de valores y a otros participantes del mercado de valores (the general rules, regulations and other general provisions issued by the Comisión Nacional Bancaria y de Valores (Mexican Banking and Securities Commission, or “CNBV”), or “General Issuer’s Rules”), nor is the offering contemplated hereby being authorized by the CNBV; therefore, any such shares may not be offered or sold publicly, or otherwise be the subject of brokerage activities, in Mexico, except pursuant to a private placement exemption or other exemptions set forth in the Mexican Securities Market Law. As such, this offering can be made to any person in Mexico so long as the offering is conducted on a direct and personal basis and it complies, among other requirements as set forth under the LMV and the General Issuer’s Rules, with the following:
 
 	(a)	 	it is made to persons who are inversionistas institucionales (institutional investors) within the meaning of Article 2, Roman numeral XVII, of the LMV and regarded as such pursuant to the laws of Mexico, or inversionistas calificados (qualified investors) within the meaning of Article 2, Roman numeral XVI, of the LMV, and have the income, assets or qualitative characteristics provided for under Article 1, Roman numeral XIII of the General Issuer’s Rules, which require maintenance, in average over the past year, of investments in securities (within the meaning of the LMV) for an amount equal or greater than 1,500,000 Unidades de Inversión (Investment Units or “UDIs”), or in each of the last two years had a gross annual income equal to or greater than 500,000 UDIs; or	
 
 	(b)	 	it is made to persons who are stockholders of companies which fulfill their corporate purpose exclusively or substantially with such securities (e.g., investment companies authorized to invest in such securities); or	
 
 	(c)	 	it is made pursuant to a plan or applicable program for our or our affiliates’ employees or groups of employees; or	
 
 	(d)	 	it is made to less than 100 persons, to the extent such persons do not qualify under (a), (b) or (c) above.	
In identifying proposed purchasers for the shares in Mexico, the underwriters will only contact persons or entities whom they reasonably believe are within one of the four categories described in the immediately preceding paragraph in items (a) through (d). The underwriters may further require you to expressly reiterate that you fall into one of the above mentioned categories, that you further understand that the private offering of shares has less documentary and information requirements than public offerings do, and to waive the right to claim on any lacking thereof.
This prospectus may not be publicly distributed in Mexico, whether through mass media to indeterminate subjects or otherwise, and they are not intended to serve as an application for the registration of the shares before
 
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the CNBV or listing of the shares before the Bolsa Mexicana de Valores, S.A.B. de C.V. (Mexican Stock Exchange, or “BMV”), nor as a prospectus in connection with a public offering in Mexico. This prospectus is solely our responsibility and has not been reviewed or authorized by the CNBV. The CNBV has not assessed or passed on the investment quality of the shares, our solvency, liquidity or credit quality or the accuracy or completeness of the information provided in this prospectus. In making an investment decision, all investors, including any Mexican investors who may acquire shares from time to time, must rely on their own review and examination of our company. The acquisition of the shares by an investor who is a resident of Mexico will be made under its own responsibility.
Panama
The ordinary shares described in this prospectus have not been, and will not be, registered for public offering in Panama with the Panamanian Superintendency of the Securities Market ( Superintendencia del Mercado de Valores , previously the National Securities Commission of Panama) under Decree-Law 1 of July 8, 1999, as reformed by Law 67 of 2011 (the “Panamanian Securities Act”). Accordingly, the shares may not be offered or sold in Panama nor to persons domiciled in Panama, except in certain limited transactions exempted from the registration requirements of the Panamanian Securities Act. The shares do not benefit from tax incentives accorded by the Panamanian Securities Act, and are not subject to regulation or supervision by the Panamanian Superintendency of the Securities Market as long as the shares are privately offered to no more than 25 persons domiciled in Panama and result in the sale to no more than 10 of such persons.
People’s Republic of China
This offering has not been approved or registered in the People’s Republic of China (the “PRC”). This prospectus may not be circulated or distributed in the PRC and the shares may not be offered or sold, and will not be offered or sold to any person for re-offering or resale, directly or indirectly, to any person in the PRC, except to the extent consistent with applicable laws and regulations of the PRC. For the purpose of this paragraph, the PRC does not include Taiwan and the special administrative regions of Hong Kong and Macau.
Peru
The shares and the information contained in this prospectus have not been and will not be registered with or approved by the Peruvian Securities Commission or the Lima Stock Exchange. Accordingly, the shares cannot be offered or sold in Peru, except if such offering is considered a private offering under the securities laws and regulations of Peru.
Qatar
The ordinary shares described in this prospectus have not been and will not be offered, sold or delivered, at any time, directly or indirectly in the State of Qatar in a manner that would constitute a public offering. The shares are not and will not be listed on the Qatar Exchange.
This prospectus has not been, and will not be, reviewed or approved by or filed or registered with the Qatar Financial Markets Authority, Qatar Central Bank or the Qatar Financial Centre Regulatory Authority and may not be publicly distributed. This prospectus is intended for the original recipient only and must not be provided to any other person. It is not for general circulation in the State of Qatar and may not be reproduced or used for any other purpose.
Singapore
This prospectus has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this prospectus and any other document or material in connection with the offer or sale, or
 
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invitation for subscription or purchase, of the shares may not be circulated or distributed, nor may the shares be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than (i) to an institutional investor under Section 274 of the Securities and Futures Act, Chapter 289 of Singapore (the “SFA”), (ii) to a relevant person pursuant to Section 275(1), or any person pursuant to Section 275(1A), and in accordance with the conditions specified in Section 275 of the SFA or (iii) otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA, in each case subject to compliance with conditions set forth in the SFA.
Switzerland
No ordinary shares described in this prospectus will be publicly offered or distributed in Switzerland. The shares shall be offered in Switzerland privately only to a select circle of investors without the use of any public means of information or advertisement.
This prospectus does not constitute an offer prospectus within the meaning of Art. 652a of the Swiss Code of Obligations. It has not been filed with or approved by any Swiss regulatory authority or stock exchange. The shares will not be registered in Switzerland or listed at any Swiss stock exchange. This document may not be distributed or used in Switzerland without our prior written approval.
United Arab Emirates
The ordinary shares described in this prospectus will be sold outside the United Arab Emirates and are not part of a public offering and are being offered to a limited number of institutional and private investors in the United Arab Emirates. We have not been reviewed, approved or licensed by the United Arab Emirates Central Bank or any other relevant licensing authorities or governmental agencies in the United Arab Emirates. This document is strictly private and confidential and has not been reviewed, deposited or registered with any licensing authority or governmental agency in the United Arab Emirates, and is being issued to a limited number of institutional and private investors and must not be provided to any person other than the original recipient and may not be reproduced or used for any other purpose. Our shares may not be offered or sold directly or indirectly to the public in the United Arab Emirates.
United Kingdom
Each underwriter has represented and agreed that:
 
 	(a)	 	it has only communicated or caused to be communicated and will only communicate or cause to be communicated an invitation or inducement to engage in investment activity (within the meaning of Section 21 of the Financial Services and Markets Act 2000 (“FSMA”) received by it in connection with the issue or sale of the ordinary shares in circumstances in which Section 21(1) of the FSMA does not apply to us; and	
 
 	(b)	 	it has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the ordinary shares in, from or otherwise involving the United Kingdom.	
 
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 EXPENSES RELATED TO THIS OFFERING
We estimate that expenses of the offering, excluding underwriting discounts and commissions, incurred by us will be as follows:

SEC registration fee	  	$	57,190	  	
FINRA filing fee	  	 	56,002	  	
Exchange listing fee	  	 	250,000	  	
Printing expenses	  	 	850,000	  	
Legal fees and expenses	  	 	3,500,000	  	
Accounting fees and expenses	  	 	4,100,000	  	
Miscellaneous expenses	  	 	1,000,000	  	
	  	 	 	 	
Total expenses	  	$	9,813,192	  	
	  	 	 	 	
All amounts in the table are estimated except for the SEC registration fee and the FINRA filing fee.

*	To be filed by amendment.	
 
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 LEGAL MATTERS
Certain legal matters in connection with this offering will be passed upon for us by Kirkland & Ellis LLP, New York, New York. The validity of the ordinary shares will be passed upon for us by Arendt & Medernach, Luxembourg. Simpson Thacher & Bartlett LLP, New York, New York, is acting as counsel to the underwriters. An investment partnership composed of partners of Kirkland & Ellis LLP has an equity interest in Topco.
 EXPERTS
The combined carve-out Predecessor financial statements as of December 31, 2011 and November 30, 2012 and for the year ended December 31, 2011 and the eleven-month period ended November 30, 2012 and the consolidated Successor financial statements as of December 31, 2012 and 2013 and the one-month period ended December 31, 2012 and the year ended December 31, 2013 appearing in this prospectus have been audited by Ernst & Young, S.L., independent registered public accounting firm, as set forth in their reports thereon appearing elsewhere herein, and are included in reliance upon such reports given on the authority of such firm as experts in auditing and accounting. The address of Ernst & Young, S.L. is Torre Picasso, Plaza Pablo Ruiz Picasso, 1, 28020, Madrid, Spain.
 WHERE YOU CAN FIND MORE INFORMATION
We have filed a registration statement on Form F-1, of which this prospectus is a part, with the Securities and Exchange Commission, or SEC, relating to this offering. This prospectus does not contain all of the information in the registration statement, including the exhibits filed with the registration statement. You should read the registration statement and the exhibits filed as part of the registration statement. Statements contained in this prospectus as to the contents of any contract or other document are not complete, and in each instance we refer you to the copy of the contract or document filed or incorporated by reference as an exhibit to the registration statement for a more complete description of the matter involved.
Upon declaration of effectiveness of the registration statement of which this prospectus is a part, we will become subject to the informational requirements of the Securities Exchange Act of 1934. Accordingly, we will be required to file reports and other information with the SEC, including annual reports on Form 20-F and other information. You may inspect and copy reports and other information filed with the SEC at the public reference room in Washington, D.C. at 100 F Street, N.E., Washington, D.C. 20549. You can also request copies of those documents, upon payment of a duplicating fee, by writing to the SEC. Please call the SEC at 1-800-SEC-0330 for further information on the operation of the public reference room. The SEC also maintains an Internet site that contains reports, proxy and information statements and other information regarding issuers that file with the SEC. The website address is http://www.sec.gov. You may also request a copy of these filings, at no cost, by writing or telephoning us as follows: C/Quintanavides, n. 17-2 Planta, 28050 Las Tablas, Madrid, Spain, Attn: Investor Relations.
 
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 INDEX TO FINANCIAL STATEMENTS

Audited Financial Statements	  				
Financial Statements of Atalaya Luxco Midco S.à.r.l. and subsidiaries (Successor)	  				
Report of Independent Registered Public Accounting Firm	  	 	F-2	  	
Consolidated Statements of Financial Position as of December 31, 2012, and December 31, 2013	  	 	F-3	  	
Consolidated Income Statements for the one-month period ended December 31, 2012 and the year ended December 31, 2013	  	 	F-5	  	
Consolidated Statements of Comprehensive Income for the one-month period ended December 31, 2012 and the year ended December 31, 2013	  	 	F-6	  	
Consolidated Statements of Changes in Equity for the one-month period ended December 31, 2012 and the year ended December 31, 2013	  	 	F-7	  	
Consolidated Statements of Cash Flows for the one-month period ended December 31, 2012 and the year ended December 31, 2013	  	 	F-8	  	
Notes to the Consolidated Financial Statements for the one-month period ended December 31, 2012 and the year ended December 31, 2013	  	 	F-9	  	
		
Financial Statements of Atalaya Luxco Midco (Predecessor)	  				
Report of Independent Registered Public Accounting Firm	  	 	F-72	  	
Combined Carve-Out Statements of Financial Position as of January 1, 2011, December 31, 2011 and November 30, 2012	  	 	F-73	  	
Combined Carve-Out Income Statements for the year ended December 31, 2011 and January 1, 2012 to November 30, 2012	  	 	F-74	  	
Combined Carve-Out Statements of Comprehensive Income for the year ended December  31, 2011 and January 1, 2012 to November 30, 2012	  	 	F-75	  	
Combined Carve-Out Statements of Changes in Invested Equity as of December 31, 2010, December 31, 2011 and November 30, 2012	  	 	F-76	  	
Combined Carve-Out Statements of Cash Flows for the year ended December 31, 2011 and January 1, 2012 to November 30, 2012	  	 	F-77	  	
Notes to the Combined Carve-Out Financial Statements	  	 	F-78	  	
		
Unaudited Financial Statements	  				
Interim Financial Statements of Atalaya Luxco Midco S.à.r.l. and subsidiaries (Successor)	  				
Interim Consolidated Statements of Financial Position as of December 31, 2013, and June 30, 2014	  	 	F-132	  	
Interim Consolidated Income Statements for the six-month period ended June  30, 2013 and the six-month period ended June 30, 2014	  	 	F-134	  	
Interim Consolidated Statements of Other Comprehensive Income for the six-month period ended June  30, 2013 and the six-month period ended June 30, 2014	  	 	F-135	  	
Interim Consolidated Statements of Changes in Equity for the six-month period ended June  30, 2013 and the six-month period ended June 30, 2014	  	 	F-136	  	
Interim Consolidated Statements of Cash Flows for the six-month period ended June  30, 2013 and the six-month period ended June 30, 2014	  	 	F-137	  	
Notes to the Interim Consolidated Financial Statements for six-month period ended June 30, 2014	  	 	F-138	  	
 
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 Report of Independent Registered Public Accounting Firm
The Board of Directors and Sole Shareholder of Atalaya Luxco Midco S.à.r.l.
We have audited the accompanying consolidated statements of financial position of Atalaya Luxco Midco S.à.r.l (the “Company”) and subsidiaries as of December 31, 2012 and 2013, and the related consolidated statements of income, comprehensive income, changes in equity, and cash flows for the one-month period ended December 31, 2012 and the year ended December 31, 2013. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. We were not engaged to perform an audit of the Company’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Atalaya Luxco Midco S.à.r.l and subsidiaries at December 31, 2012 and 2013, and the consolidated results of their operations and their cash flows for the one-month period ended December 31, 2012 and the year ended December 31, 2013, in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board.
Ernst & Young, S.L.
/s/ Carlos Hidalgo Andres
Carlos Hidalgo Andres
Madrid, Spain
April 30, 2014
 
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Table of Contents
 ATALAYA LUXCO MIDCO, S.A.R.L AND SUBSIDIARIES
(FORMERLY BC LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES)
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
as of December 31, 2012 and December 31, 2013
(In thousands of U.S. Dollars)

ASSETS	  	Notes	  	December 31,
2012	 	  	December 31,
2013	 	
NON-CURRENT ASSETS	  		  	 	1,181,674	  	  	 	1,071,381	  	
	  		  	 	 	 	  	 	 	 	
Intangible assets	  	Note 6	  	 	477,818	  	  	 	392,777	  	
Goodwill	  	Note 7	  	 	230,553	  	  	 	197,739	  	
Property, plant and equipment	  	Note 9	  	 	224,462	  	  	 	231,603	  	
Non-current financial assets	  		  	 	58,548	  	  	 	69,323	  	
Trade and other receivables	  	Notes 13 and 26	  	 	7,482	  	  	 	72	  	
Other non-current financial assets	  	Note 12	  	 	51,066	  	  	 	53,812	  	
Derivative financial instruments	  	Note 14	  	 	—	  	  	 	15,439	  	
Deferred tax assets	  	Note 20	  	 	190,293	  	  	 	179,939	  	
	  		  	 	 	 	  	 	 	 	
CURRENT ASSETS	  		  	 	779,288	  	  	 	770,799	  	
	  		  	 	 	 	  	 	 	 	
Trade and other receivables	  		  	 	547,869	  	  	 	553,026	  	
Trade and other receivables	  	Notes 13 and 26	  	 	520,216	  	  	 	521,286	  	
Current income tax receivables	  	Note 20	  	 	9,536	  	  	 	12,962	  	
Other receivables from public administrations	  	Note 20	  	 	18,117	  	  	 	18,778	  	
Other current financial assets	  		  	 	31,108	  	  	 	4,282	  	
Other financial assets	  	Notes 12 and 26	  	 	31,108	  	  	 	1,425	  	
Derivative financial instruments	  	Note 14	  	 	—	  	  	 	2,857	  	
Cash and cash equivalents	  	Note 15	  	 	200,311	  	  	 	213,491	  	
	  		  	 	 	 	  	 	 	 	
TOTAL ASSETS	  		  	 	1,960,962	  	  	 	1,842,180	  	
	  		  	 	 	 	  	 	 	 	
The accompanying Notes 1 to 28 form an integral part of the consolidated financial statements
 
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ATALAYA LUXCO MIDCO, S.A.R.L AND SUBSIDIARIES
(FORMERLY BC LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES)
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
as of December 31, 2012, and December 31, 2013
(In thousands of U.S. Dollars)

EQUITY AND LIABILITIES	  	Notes	  	December 31,
2012	 	 	December 31,
2013	 	
EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT	  		  	 	(32,713	) 	 	 	(133,966	) 	
	  		  	 	 	 	 	 	 	 	
Share capital	  	Note 19	  	 	2,592	  	 	 	2,592	  	
Retained earnings	  	Note 19	  	 	(56,620	) 	 	 	(60,659	) 	
Translation differences	  	Note 19	  	 	21,328	  	 	 	(77,513	) 	
Valuation adjustments	  	Note 19	  	 	—	  	 	 	1,627	  	
Other reserves	  		  	 	(13	) 	 	 	(13	) 	
	  		  	 	 	 	 	 	 	 	
NON-CURRENT LIABILITIES	  		  	 	1,523,387	  	 	 	1,591,287	  	
	  		  	 	 	 	 	 	 	 	
Deferred tax liabilities	  	Note 20	  	 	138,079	  	 	 	119,282	  	
Interest-bearing debt	  	Note 17	  	 	813,055	  	 	 	833,984	  	
Non-current payables to Group companies	  	Notes 17 and 26	  	 	471,624	  	 	 	519,607	  	
Derivative financial instruments	  	Note 14	  	 	—	  	 	 	15,962	  	
Non-current provisions	  	Note 21	  	 	100,541	  	 	 	99,062	  	
Non-current non trade payables	  	Note 18	  	 	88	  	 	 	1,441	  	
Other non-current payables to public administrations	  	Note 20	  	 	—	  	 	 	1,949	  	
	  		  	 	 	 	 	 	 	 	
CURRENT LIABILITIES	  		  	 	470,288	  	 	 	384,859	  	
	  		  	 	 	 	 	 	 	 	
Interest-bearing debt	  	Note 17	  	 	36,117	  	 	 	17,128	  	
Current payables to Group companies	  	Notes 17 and 26	  	 	38	  	 	 	—	  	
Trade and other payables	  		  	 	409,239	  	 	 	353,213	  	
Trade payables	  	Notes 18 and 26	  	 	117,204	  	 	 	109,897	  	
Current income tax payable	  	Note 20	  	 	18,688	  	 	 	7,582	  	
Other current payables to public administrations	  	Note 20	  	 	76,247	  	 	 	74,983	  	
Other non-trade payables	  	Note 18	  	 	197,100	  	 	 	160,751	  	
Current provisions	  	Note 21	  	 	24,894	  	 	 	14,518	  	
	  		  	 	 	 	 	 	 	 	
TOTAL EQUITY AND LIABILITIES	  		  	 	1,960,962	  	 	 	1,842,180	  	
	  		  	 	 	 	 	 	 	 	
The accompanying Notes 1 to 28 form an integral part of the consolidated financial statements
 
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 ATALAYA LUXCO MIDCO, S.A.R.L AND SUBSIDIARIES
(FORMERLY BC LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES)
CONSOLIDATED INCOME STATEMENTS
One-month period ended December 31, 2012 and the year ended December 31, 2013
(In thousands of U.S. Dollars)

 	  	Notes	 	December 1
to December 31,
2012	 	 	For the year
ended
December 31,
2013	 	
Revenue	  	Note 22 a)	 	 	190,875	  	 	 	2,341,115	  	
Other operating income	  	Note 22 b)	 	 	1,814	  	 	 	4,367	  	
Own work capitalized	  		 	 	—	  	 	 	948	  	
Supplies	  	Note 22 c)	 	 	(8,367	) 	 	 	(115,340	) 	
Employee benefit expense	  	Note 22 d)	 	 	(126,707	) 	 	 	(1,643,497	) 	
Depreciation and amortization	  	Note 22 e)	 	 	(7,500	) 	 	 	(128,975	) 	
Changes in trade provisions	  	Note 13	 	 	2,792	  	 	 	2,026	  	
Other operating expenses	  	Note 22 f)	 	 	(95,351	) 	 	 	(355,670	) 	
	  		 	 	 	 	 	 	 	 	
OPERATING (LOSS)/PROFIT	  		 	 	(42,444	) 	 	 	104,974	  	
	  		 	 	 	 	 	 	 	 	
Finance income	  	Note 22 g)	 	 	2,595	  	 	 	17,793	  	
Finance costs	  	Note 22 g)	 	 	(8,663	) 	 	 	(135,074	) 	
Net foreign exchange gains	  	Note 22 g)	 	 	24	  	 	 	16,614	  	
	  		 	 	 	 	 	 	 	 	
NET FINANCE EXPENSE	  		 	 	(6,044	) 	 	 	(100,667	) 	
	  		 	 	 	 	 	 	 	 	
(LOSS)/PROFIT BEFORE TAX	  		 	 	(48,488	) 	 	 	4,307	  	
	  		 	 	 	 	 	 	 	 	
Income tax expense	  	Note 20	 	 	(8,132	) 	 	 	(8,346	) 	
	  		 	 	 	 	 	 	 	 	
LOSS FOR THE PERIOD ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT	  		 	 	(56,620	) 	 	 	(4,039	) 	
	  		 	 	 	 	 	 	 	 	
Result per share attributable to owners of the parent	  		 				 				
	  		 				 				
Basic and diluted result per share	  		 	 	(28.31	) 	 	 	(2.02	) 	
	  		 	 	 	 	 	 	 	 	
The accompanying Notes 1 to 28 form an integral part of the consolidated financial statements
 
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 ATALAYA LUXCO MIDCO, S.A.R.L AND SUBSIDIARIES
(FORMERLY BC LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES)
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
One-month period ended December 31, 2012 and year ended December 31, 2013
(In thousands of U.S. Dollars)

 	  	December 1 to
December 31, 2012	 	 	For the year ended
December 31, 2013	 	
Loss for the period/year	  	 	(56,620	) 	 	 	(4,039	) 	
	  	 	 	 	 	 	 	 	
Other comprehensive income/(loss):	  				 				
Items that will not be reclassified to profit and loss	  	 	(13	) 	 	 	—	  	
Items that may subsequently be reclassified to profit and loss	  				 				
Cash flow hedges (Note 19)	  	 	—	  	 	 	4,628	  	
Tax effect (Note 20)	  	 	—	  	 	 	(3,001	) 	
Translation differences	  	 	21,328	  	 	 	(98,841	) 	
	  	 	 	 	 	 	 	 	
Other comprehensive income/(loss), net of taxes	  	 	21,315	  	 	 	(97,214	) 	
	  	 	 	 	 	 	 	 	
Total consolidated comprehensive loss	  	 	(35,305	) 	 	 	(101,253	) 	
	  	 	 	 	 	 	 	 	
The accompanying Notes 1 to 28 form an integral part of the consolidated financial statements
 
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 ATALAYA LUXCO MIDCO, S.A.R.L AND SUBSIDIARIES
(FORMERLY BC LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES)
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
One-month period ended December 31, 2012 and Year ended December 31, 2013
(In thousands of U.S. Dollars)

 	  	Share
capital
(Note 19)	 	  	Retained
earnings
(Note 19)	 	 	Translation
differences	 	 	Valuation
adjustments
(Note 19)	 	  	Other
reserves	 	 	Total equity	 	
Balance at December 1, 2012	  	 	2,592	  	  	 	—	  	 	 	—	  	 	 	—	  	  	 	—	  	 	 	2,592	  	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Comprehensive income/(loss) for the period	  	 	—	  	  	 	(56,620	) 	 	 	21,328	  	 	 	—	  	  	 	(13	) 	 	 	(35,305	) 	
Loss for the period	  	 	—	  	  	 	(56,620	) 	 	 	—	  	 	 	—	  	  	 	—	  	 	 	(56,620	) 	
Other comprehensive income/(loss)	  	 	—	  	  	 	—	  	 	 	21,328	  	 	 	—	  	  	 	(13	) 	 	 	21,315	  	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Balance at December 31, 2012	  	 	2,592	  	  	 	(56,620	) 	 	 	21,328	  	 	 	—	  	  	 	(13	) 	 	 	(32,713	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Balance at January 1, 2013	  	 	2,592	  	  	 	(56,620	) 	 	 	21,328	  	 	 	—	  	  	 	(13	) 	 	 	(32,713	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Comprehensive income/(loss) for the period	  	 	—	  	  	 	(4,039	) 	 	 	(98,841	) 	 	 	1,627	  	  	 	—	  	 	 	(101,253	) 	
Loss for the period	  	 	—	  	  	 	(4,039	) 	 	 	—	  	 	 	—	  	  	 	—	  	 	 	(4,039	) 	
Other comprehensive income/(loss)	  	 	—	  	  	 	—	  	 	 	(98,841	) 	 	 	1,627	  	  	 	—	  	 	 	(97,214	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Balance at December 31, 2013	  	 	2,592	  	  	 	(60,659	) 	 	 	(77,513	) 	 	 	1,627	  	  	 	(13	) 	 	 	(133,966	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
The accompanying Notes 1 to 28 form an integral part of the consolidated financial statements
 
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 ATALAYA LUXCO MIDCO, S.A.R.L AND SUBSIDIARIES
(FORMERLY BC LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES)
CONSOLIDATED STATEMENTS OF CASH FLOWS
One-month period ended December 31, 2012 and Year ended December 31, 2013
(In thousands of U.S. Dollars)

 	  	Note	  	December 1 to
December 31,
2012	 	 	For the year
ended
December 31,
2013	 	
Operating activities	  		  				 				
Profit/(loss) before tax	  		  	 	(48,488	) 	 	 	4,307	  	
Adjustments to profit/(loss):	  		  	 	19,315	  	 	 	250,653	  	
Amortization, depreciation and impairment	  	6, 9	  	 	7,500	  	 	 	128,976	  	
Impairment allowances	  	22	  	 	(2,792	) 	 	 	(2,026	) 	
Change in provisions	  	22	  	 	9,372	  	 	 	23,638	  	
Grants released to income	  	22	  	 	(809	) 	 	 	(1,702	) 	
Gains/(losses) on derecognition and disposal of fixed assets	  	22	  	 	—	  	 	 	1,160	  	
Finance income	  	22	  	 	(2,595	) 	 	 	(10,832	) 	
Finance expense	  	22	  	 	8,663	  	 	 	116,474	  	
Net foreign exchange gains	  	22	  	 	(24	) 	 	 	(16,614	) 	
Change in fair value of financial instruments	  	22	  	 	—	  	 	 	11,579	  	
Change in trade receivables and other accounts receivable	  		  	 	59,574	  	 	 	41,628	  	
Change in trade payables and other accounts payable	  		  	 	(71,906	) 	 	 	(67,909	) 	
Other assets (payables)	  		  	 	(8,025	) 	 	 	(20,742	) 	
Interest paid	  		  	 	(3,340	) 	 	 	(63,269	) 	
Interest received	  		  	 	2,521	  	 	 	5,476	  	
Income tax paid	  		  	 	(6,467	) 	 	 	(30,750	) 	
Payments of provisions	  		  	 	(11,467	) 	 	 	(19,795	) 	
	  		  	 	 	 	 	 	 	 	
Net cash flows from/(used in) operating activities	  		  	 	(68,283	) 	 	 	99,599	  	
	  		  	 	 	 	 	 	 	 	
Investing activities	  		  				 				
Payments for acquisition of intangible assets	  	6	  	 	(3,313	) 	 	 	(13,551	) 	
Payments for acquisition of property, plant and equipment	  	9	  	 	(12,904	) 	 	 	(115,223	) 	
Payments for financial instruments	  	11	  	 	(34,548	) 	 	 	(14,829	) 	
Acquisition of subsidiaries	  	5	  	 	(795,363	) 	 	 	(13,284	) 	
Disposals of intangible assets	  	6	  	 	—	  	 	 	755	  	
Disposals of tangible assets	  	9	  	 	—	  	 	 	—	  	
Proceeds from other financial assets	  	11	  	 	—	  	 	 	32,731	  	
	  		  	 	 	 	 	 	 	 	
Net cash flows from/(used in) investing activities	  		  	 	(846,128	) 	 	 	(123,401	) 	
	  		  	 	 	 	 	 	 	 	
Financing activities	  		  				 				
Proceeds from issue of equity instruments	  	19	  	 	2,626	  	 	 	—	  	
Proceeds from borrowings from third parties	  	18	  	 	637,688	  	 	 	280,709	  	
Proceeds from borrowings from group companies	  	18	  	 	469,314	  	 	 	—	  	
Repayment of borrowings from third parties	  	18	  	 	—	  	 	 	(200,723	) 	
Repayment of borrowings from group companies	  	18	  	 	—	  	 	 	(48,765	) 	
	  		  	 	 	 	 	 	 	 	
Net cash flows from/(used in) financing activities	  		  	 	1,109,628	  	 	 	31,221	  	
	  		  	 	 	 	 	 	 	 	
Exchange differences	  		  	 	5,094	  	 	 	5,761	  	
Net increase in cash and cash equivalents	  		  	 	200,311	  	 	 	13,180	  	
	  		  	 	 	 	 	 	 	 	
Cash and cash equivalents at beginning of period	  	15	  	 	—	  	 	 	200,311	  	
	  		  	 	 	 	 	 	 	 	
Cash and cash equivalents at end of period	  		  	 	200,311	  	 	 	213,491	  	
	  		  	 	 	 	 	 	 	 	
The accompanying Notes 1 to 28 form part of the consolidated financial statements.
 
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 ATALAYA LUXCO MIDCO, S.A.R.L AND SUBSIDIARIES
(FORMERLY BC LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE ONE-MONTH PERIOD ENDED DECEMBER 31, 2012 AND THE YEAR ENDED DECEMBER 31, 2013
1) ACTIVITY OF ATALAYA LUXCO MIDCO, S.A.R.L AND CORPORATE INFORMATION
Atalaya Luxco Midco—formerly BC Luxco Midco—(hereinafter the “Company”), and its subsidiaries (hereinafter the “Atento Group”) comprise a group of companies that offers contact management services to its clients throughout the entire contract life cycle, through contact centers or multichannel platforms.
The Company was incorporated on November 27, 2012 as a limited-liability company. Finally, on February 6, 2013, the Company changed its corporate name from BC Luxco Midco to Atalaya Luxco Midco.
The Company was incorporated under the laws of the Grand-Duchy of Luxembourg, with registered office in Luxembourg at 4, Rue Lou Hemmer.
The Company was acquired in 2012 by Bain Capital Partners, LLC (hereinafter “Bain Capital”). Bain Capital is a private investment fund that invests in companies with a high growth potential. Notable among its investments in the Customer Relationship Management (hereinafter “CRM”) sector is its holding in Bellsystem 24, a leader in customer service in Japan, and Genpact, the largest business management services company in the world.
In December 2012, Bain Capital reached a definitive agreement with Telefónica, S.A. for the transfer of nearly 100% of the CRM business carried out by Atento Group companies (hereinafter the “Acquisition”), the parent company of which was Atento Inversiones y Teleservicios, S.A. (hereinafter “AIT”). The Venezuela-based subsidiaries of the group headed by AIT, and AIT, except for some specific assets and liabilities, were not included in the Acquisition. Control was transferred for the purposes of creating the consolidated Atento Group on December 1, 2012. Until that time, the Company had been idle and the consolidated Atento Group did not exist. For this reason, these consolidated financial statements are presented since December 1, 2012, date the Atento Group was incorporated.
Note 3.t. contains a list of companies comprising the Atento Group, as well as pertinent information thereon. There were no changes in the scope of consolidation in 2013.
The sole shareholder of the Company is a firm incorporated under the laws of the Grand-Duchy of Luxembourg, ATALAYA Luxco TOPCO, S.C.A. (Luxembourg).
The Company’s corporate purpose is to hold business stakes of any kind in companies in Luxembourg and abroad, purchase and sell, subscribe or any other format, and transfer through sale, swap or otherwise of securities of any kind, and administration, management, control and development of the investment portfolio.
The Company may also act as the guarantor of loans and securities, as well as assist companies in which it holds direct or indirect interests or that form part of its group. The Company may secure funds, with the exception of public offerings, through any kind of lending, or through the issuance of bonds, securities or debt instruments in general.
The Company may also carry on any commercial, industrial, financial, real estate business or intellectual property related activity that it deems necessary to meet the aforementioned corporate purpose.
The corporate purpose of its subsidiaries, with the exception of the intermediate holding companies, is to establish, manage and operate CRM centers through multichannel platforms; provide telemarketing, marketing
 
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and “call center” services through service agencies or any other format currently existing or which may be developed in the future by the Atento Group; provide telecommunications, logistics, telecommunications system management, data transmission, processing and Internet services and to promote new technologies in these areas; offer consultancy and advisory services to customers in all areas in connection with telecommunications, processing, integration systems and new technologies, and other services related to the above.
2) BASIS OF PRESENTATION OF THE CONSOLIDATED FINANCIAL STATEMENTS
a) True and fair view
The consolidated financial statements have been prepared by Management on the basis of the accounting records of Atalaya Luxco Midco, S.A.R.L. and its Group companies, control of which was acquired by Bain on December 1, 2012.
The consolidated financial statements were prepared in accordance with the International Financial Reporting Standards (hereinafter “IFRS”) issued by the International Accounting Standard Board (hereinafter the “IASB”) and IFRIC interpretations prevailing at December 31, 2013. These are the Atento Group’s first consolidated financial statements prepared under IFRS.
The consolidated financial statements have been prepared on a historical cost basis, with the exception of derivative financial instruments and Contingent Value Instruments, which have been measured at fair value.
The consolidated financial statements have been issued by the Board of the Company, Atalaya Luxco Midco, S.A.R.L. in Luxembourg on April 29, 2014. These consolidated financial statements have not been yet approved by the General Shareholders Meeting of the Parent Company. However, the Board of Directors expects them to be approved without amendments.
The preparation of financial statements under IFRS requires the use of certain key accounting estimates. IFRS also requires Management to exercise judgment throughout the process of applying the Atento Group’s accounting policies. Note 3.s. discloses the areas entailing a more significant degree of judgment or complexity and the areas where assumptions and estimates are more relevant to the presentation of these consolidated financial statements.
Note 3 contains a detailed description of the most significant accounting policies used to prepare these consolidated financial statements.
The figures in these consolidated financial statements, comprising the consolidated statement of financial position, the consolidated income statement, the consolidated statement of comprehensive income, the consolidated statement of changes in equity, the consolidated statement of cash flows, and the notes thereto are expressed in thousands of U.S. dollars, unless otherwise indicated. The U.S. Dollar is the Atento Group’s presentation currency.
These consolidated financial statements reflect the classification of companies in the ATALAYA Luxco TOPCO, S.C.A. and subsidiaries group as Group companies, separately identifying the pertinent balances and transactions from these companies from remaining receivables, payables, income, expenses, proceeds and payments.
b) Comparative information
Although the figures for the year ended December 31, 2013 correspond to a full year of activity for the Atento Group, the figures for 2012, shown for comparative purposes, correspond to the period in which the Atento Group began its activity, since December 1 to December 31, 2012. Accordingly, the figures for 2013 are not fully comparable with those for 2012.
 
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c) Consolidated statement of cash flows
The consolidated statement of cash flows has been prepared using the indirect method pursuant to International Accounting Standard 7 “Statement of Cash Flows”. Foreign currency transactions are translated at the average exchange rate for the period, in those cases where the currency differs from the presentation currency of Atento Group (U.S. dollar), as indicated in Note 3 b. The effect of exchange rate fluctuations on cash and cash equivalents, maintained or owed, in foreign currency, is presented in the statement of cash flows to reconcile cash and cash equivalents at the beginning of the period and at period-end.
d) Going concern
As of December 31, 2013, the Atento Group presents negative shareholders’ equity in an amount of 133,966 thousands of U.S. dollars (32,713 thousands of U.S. dollars as of December 31, 2012), primarily due to the incorporation of the new Group, following the acquisition of the former Atento Group, where equity has been negatively impacted by the costs incurred in connection with the acquisition and by integration related costs associated to the change in ownership. Shareholders’ equity is also negatively impacted by the impact of foreign exchanges in 2013 and the impact of the Atento Group’s financial structure reflected in the negative net finance result.
As of December 31, 2013 and 2012, all short term commitments had been settled within their periods, and it is expected that all debt maturities within the next twelve months will be settled in the required periods.
Management considers that the fundamentals of the business remain sound and that the following factors reasonably will further contribute to mitigate any uncertainty on the capacity of the Atento Group to generate enough resources in order to operate under a going concern basis:
 
 	•	 	Atento Group enjoys a sound liquidity position with total cash and cash equivalents as at December 31, 2013 amounting to 213,491 thousands U.S. dollars, above our minimum cash requirements to operate the business (compared to 200,311 thousands U.S. dollars in 2012). In addition, we entered into a Super Senior Revolving Credit Facility in 2013 allowing for borrowings up to 69 million U.S. dollars, which remains undrawn as at December 31, 2013.	
 
 	•	 	As indicated in the paragraph above, the Atento Group has cash and financing facilities available to cover payments arising in the normal course of its business and financing commitments arisen from our debt commitments, as well as positive working capital.	
 
 	•	 	Atento Group continues to implement measures with the objective of growing revenue in the medium term. Revenue growth is expected to be driven by accelerated customer acquisitions, focus on further expanding our multi-sector customers leveraging on our strong credentials and market position in the countries where we operate.	
 
 	•	 	In addition to the above, the Atento Group is also focused on several initiatives to further drive margin expansion and incremental EBITDA potential through enhancement of operations productivity, centralization and standardization of activities following the exit from Telefónica Group, such procurement activities, and efficiencies in costs.	
 
 	•	 	The measures described above are not only oriented to an improvement in revenue and margins but also to improve the cash generation and the efficiency of working capital.	
 
 	•	 	The Atento Group has debt instruments available, such as the Preferred Equity Certificates described in Note 26, which can be capitalized as equity if necessary and which would have a double impact of reducing finance expenses and reducing negative retained earnings.	
Accordingly, management has prepared these consolidated financial statements based on the principle of going concern.
 
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3) ACCOUNTING POLICIES AND MEASUREMENT CRITERIA
The main accounting policies used in preparing the accompanying consolidated financial statements are set out below. Except where otherwise indicated, these policies have been applied on a consistent basis in all periods shown in the statements.
a) Subsidiaries, business combinations and goodwill
Subsidiaries are all companies in which the Group is able to control financial and operating policies, a position which is generally accompanied by an ownership interest entitling it to more than half of the voting rights. To determine whether the Group controls another company, the existence and effect of potential voting rights that are currently exercisable or convertible are taken into account. In cases where the Group does not hold more than 50% of voting rights but is able to guide the financial and operating policies of a given investee, an assessment is carried out to determine whether control exists.
Subsidiaries are consolidated as from the date their control is transferred to the Group, and they are excluded from consolidation as from the date the Group ceases to exercise control.
The Group applies the acquisition method when recognizing business combinations. The consideration given for the acquisition of a subsidiary is understood to correspond to the fair value of the assets transferred, the liabilities assumed vis-à-vis the former owners of the acquiree, and any equity instruments therein issued by the Group. The consideration given includes the fair value of any asset or liability stemming from any contingent consideration agreement.
Any contingent consideration to be transferred by the Group is recognized at fair value at the acquisition date. Subsequent changes in the fair value of any contingent consideration deemed an asset or a liability are recognized in income or as a change in other comprehensive income, in accordance with IAS 39, Financial Instruments: Recognition and Measurement. Contingent consideration classified as equity is not remeasured, and any subsequent settlement thereof is also recognized in equity. Costs related with the acquisition are recognized as expenses in the year incurred.
Identifiable assets acquired and identifiable liabilities and contingent liabilities assumed in a business combination are initially measured at fair value at the acquisition date.
Goodwill is initially measured as any excess of total consideration given over the net identifiable assets acquired and liabilities assumed. If the fair value of the net assets acquired is greater than the aggregate consideration transferred, the difference is recognized on the income statement.
Goodwill is tested for impairment annually, or more frequently if there are certain events or changes in circumstances indicating potential impairment.
As part of this impairment test, the goodwill acquired in a business combination is assigned to each cash-generating unit, or group of cash-generating units, that is expected to benefit from the synergies arising in the business combination.
The carrying amount of the assets allocated to each cash generating unit is then compared with its recoverable amount, which is the greater of the value in use or the fair value less costs to sell. Any impairment loss is immediately taken to the income statement, and may not be reversed (see section h).
b) Presentation currency
The consolidated financial statements are presented in thousands of U.S. dollar, which is the presentation currency of the Atento Group.
 
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c) Foreign currency translation
The results and financial position of all Atento Group entities (none of which uses a currency of an inflationary economy) whose functional currency is different from the presentation currency are translated to the presentation currency as follows:
 
 	•	 	Statement of financial position assets and liabilities are translated at the exchange rate prevailing at the reporting date.	
 
 	•	 	Income statement items are translated at average exchange rates for the year.	
 
 	•	 	Proceeds and payments shown on the statement of cash flows are translated at average exchange rates for the period.	
 
 	•	 	Retained earnings are translated at historical exchange rates.	
Goodwill and fair value adjustments to net assets arising from the acquisition of a foreign company are considered to be assets and liabilities of the foreign company and are translated at year-end exchange rates.
d) Foreign currency transactions
Transactions in foreign currency are translated to the functional currency using exchange rates prevailing at the transaction or measurement date, in the case of items being remeasured. Foreign exchange gains and losses on settlement of these transactions and the conversion at reporting date exchange rates of monetary assets and liabilities denominated in different currency from the functional currency are recognized in the income statement, except where taken to comprehensive income, such as in the case of cash flow hedges.
e) Segment information
Segment information is presented in accordance with the internal information supplied to the chief operating decision maker. The chief operating decision maker, which is responsible for allocating resources and evaluating the performance of operational segments, has been identified as the CEO responsible for strategic decisions.
The chief operating decision maker considers the business from the geographic perspective and analyzes it as three operational segments—EMEA, Americas and Brazil. Note 23 shows detailed information by segment.
f) Intangible assets
Intangible assets are stated at acquisition cost, less any accumulated amortization and any accumulated impairment losses.
The intangible assets acquired in a business combination are initially measured at fair value at the acquisition date.
Acquisition cost comprises the purchase price, import duties and non-refundable taxes, after deducting trade discounts and rebates, and directly attributable costs of readying the asset for its intended use.
The useful lives of intangible assets are assessed on a case-by-case basis to be either finite or indefinite. Intangible assets with finite lives are amortized on a straight-line basis over their estimated useful life and assessed for impairment whenever events or changes indicate that their carrying amount may not be recoverable.
The amortization charge on intangible assets is recognized in the consolidated income statement under “Depreciation and amortization.”
Amortization methods and schedules are revised annually at the end of each reporting period and, where appropriate, adjusted prospectively.
 
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Customer base
The customer base is stated at cost and amortized on a straight-line basis over its useful life, which has been estimated to be between seven to twelve years. The customer base relates to all agreements, tacit or explicit, entered into between the Atento Group and the former owner of the Atento Group and between the Atento Group and other customers, in relation to the provision of services and that were acquired as part of the business combination indicated in Note 5.
Software
Software is measured at cost and amortized on a straight-line basis over its useful life, generally estimated at between three and five years. The cost of maintaining software is expensed as incurred.
Development costs directly attributable to the design and creation of software trails that are identifiable and unique, and that may be controlled by the Group, are recognized as an intangible asset providing the following conditions are met:
 
 	•	 	It is technically feasible that the intangible asset may be completed so that it will be available for use or sale.	
 
 	•	 	Management intends to complete the asset for use or sale.	
 
 	•	 	The Group has the capacity to use or sell the asset.	
 
 	•	 	It is possible to evidence how the intangible asset will generate probable future economic benefits.	
 
 	•	 	Adequate technical, financial and other resources are available to complete the development and to use or sell the intangible asset.	
 
 	•	 	The outlay attributable to the intangible asset during its development can be reliably determined.	
Directly attributable costs capitalized in the value of the software include the cost of personnel developing the programs and an appropriate percentage of overheads.
Costs that do not meet the criteria listed above are recognized as an expense when incurred. Expenditures for an intangible asset that are initially recognized as expenses for the period may not be subsequently recognized as intangible assets.
Capitalized software development costs are amortized over their estimated useful lives, which normally does not exceed three years.
Intellectual property
Amounts paid to acquire or use intellectual property are recognized under “Intellectual property”. Intellectual property is amortized on a straight-line basis over its useful life, estimated at 10 years.
Other intangible assets
Other intangible assets are amortized on a straight-line basis over their useful lives, which range from four to ten years.
g) Property, plant and equipment
Property, plant and equipment are measured at cost, less accumulated depreciation and any impairment losses. Land is not depreciated.
Property, plant and equipment acquired in a business combination are initially measured at fair value at the acquisition date.
 
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Acquisition cost comprises the purchase price, import duties and non-refundable taxes, after deducting trade discounts and rebates, and directly attributable costs of readying the asset for its intended use.
Acquisition cost also includes, where appropriate, the initial estimate of decommissioning, withdrawal and site reconditioning costs when the Atento Group is obliged to bear this expenditure due to the use made of the assets. Repairs that do not prolong the useful life of the assets and maintenance costs are recognized directly in the income statement. Costs that prolong or improve the life of the asset are capitalized as an increase in the cost of the asset.
The Atento Group assesses the need to write down, if appropriate, the carrying amount of each item of property, plant and equipment to its period-end recoverable amount whenever there are indications that the assets’ carrying amount may not be fully recoverable through the generation of sufficient future revenue. The impairment allowance is reversed if the factors giving rise to the impairment cease to exist (see section h).
The depreciation charge for items of property, plant and equipment is recognized in the consolidated income statement under “Depreciation and amortization.”
Depreciation is calculated on a straight-line basis over the useful life of the asset applying individual rates to each asset, which are reviewed at the end of each reporting period. For those assets acquired through a business combination, the Atento Group decided to maintain its useful lives.
The useful lives generally used by the Atento Group are as follows:

 	  	Years of useful life	
Owned buildings and Leasehold improvements	  	5 – 40	
Plant and equipment	  	3 – 6	
Furniture	  	4 – 10	
Data processing equipment	  	1 – 5	
Vehicles	  	7	
Other property, plant and equipment	  	5 – 8	
h) Impairment of non-current assets
The Atento Group assesses at each reporting date whether there is an indication that a non-current asset may be impaired. If any such indication exists, or when annual impairment testing for an asset is required (e.g. goodwill), the Atento Group estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of fair value less costs to sell or its value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. Where the carrying amount of an asset exceeds its recoverable amount, the asset is considered to be impaired. In this case, the carrying amount is written down to its recoverable amount and the resulting loss is recognized in the income statement. Future depreciation/amortization charges are adjusted for the asset’s new carrying amount over its remaining useful life. Management analyzes the impairment of each asset individually, except in the case of assets that generate cash flows which are interdependent on those generated by other assets (cash-generating units).
The Atento Group bases the calculation of impairment on the business plans of the various cash generating units to which the assets are allocated. These business plans cover five years. The projections in year five and beyond are modeled based on an estimated constant or decreasing growth rate.
When there are new events or changes in circumstances that indicate that a previously recognized impairment loss no longer exists or has been decreased, a new estimate of the asset’s recoverable amount is made. A previously recognized impairment loss is reversed only if there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognized. If that is the case, the
 
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carrying amount of the asset is increased to its recoverable amount. The reversal is limited to the carrying amount that would have been determined had no impairment loss been recognized for the asset in prior years. Such reversal is recognized in the income statement and the depreciation charge is adjusted in future periods to reflect the asset’s revised carrying amount. Impairment losses relating to goodwill cannot be reversed in future periods.
i) Financial assets and liabilities
Financial assets
Upon initial recognition, the Atento Group classifies its financial assets into one of four categories: financial assets at fair value through profit or loss, loans and receivables, held-to-maturity investments and available-for-sale financial assets. These classifications are reviewed at the end of each reporting period and modified where applicable.
The Atento Group has classified all its financial assets as loans and receivables, except for its derivative financial instruments.
All purchases and sales of financial assets are recognized on the statement of financial position on the transaction date, i.e., when the commitment is made to purchase or sell the asset.
A financial asset is fully or partially derecognized from the statement of financial position only when:
1. The rights to receive cash flows from the asset have expired;
2. The Atento Group has assumed an obligation to pay the cash flows received from the asset to a third party; or
3. The Atento Group has transferred its rights to receive cash flows from the asset to a third party, thereby substantially transferring all the risks and rewards of the asset.
Financial assets and financial liabilities are offset and presented net on the statement of financial position when a legally enforceable right exists to offset the amounts recognized and the Atento Group intends to settle the assets and liabilities net or to simultaneously realize the asset and cancel the liability.
Loans and receivables include fixed-maturity financial assets not listed in active markets and that are not derivatives. They are classified as current assets, except for those maturing more than twelve months after the reporting date, which are classified as non-current assets. Loans and receivables are initially recognized at fair value plus any transaction costs, and are subsequently measured at amortized cost, using the effective interest method. Interest calculated using the effective interest method is recognized under finance income in the income statement.
The Atento Group assesses at each reporting date whether a financial asset is impaired. Where there is objective evidence of impairment of a financial asset valued at amortized cost, the amount of the loss to be taken to the income statement is measured as the difference between the carrying amount and the present value of estimated future cash flows (without taking into account future loss), discounted at the asset’s original effective interest rate. The carrying amount of the asset is reduced and the amount of the impairment loss is expensed in the consolidated income statement.
Trade receivables
Trade receivables are amounts due from customers for the sale of goods or services in the normal course of business. Receivables slated for collection in twelve months or less are classified as current assets; otherwise, the balances are considered non-current assets.
 
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Trade receivables are recognized at the original invoice amount. An impairment provision is recorded when there is objective evidence of collection risk. The amount of the impairment provision is calculated as the difference between the carrying amount of the doubtful trade receivables and their recoverable amount. In general, cash flows relating to short-term receivables are not discounted.
Cash and cash equivalents
Cash and cash equivalents in the consolidated statement of financial position comprise cash on hand and at banks, demand deposits and other highly liquid investments with an original maturity of three months or less.
For the purpose of the consolidated statement of cash flows, cash and cash equivalents are shown net of any outstanding bank overdrafts.
Financial liabilities
Interest-bearing debt (Borrowings)
Interest-bearing debt is initially recorded at the fair value of the consideration received, less directly attributable transaction costs. After initial recognition, these financial liabilities are measured at amortized cost using the effective interest method. Any difference between the cash received (net of transaction costs) and the repayment value is recognized in the income statement over the life of the debt. Interest-bearing debt is considered non-current when the maturity date is longer than twelve months from the reporting date or when the Atento Group has full discretion to defer settlement for at least another twelve months from that date.
Financial liabilities are derecognized from the statement of financial position when the corresponding obligation is settled, cancelled or matures.
When the conditions agreed for a financial liability or part thereof are substantially modified, such modification is treated as a derecognition of the original liability and the recognition of a new liability. Conditions are considered substantially different when there is more than a 10% difference between the present value of cash flows discounted under the new terms using the original effective interest rate, including any commissions paid net of any commissions received, and the present discounted value of the cash flows remaining on the original financial liability. When an exchange of debt instruments or a modification of conditions thereof is recorded as an extinction, the costs or commissions incurred are recognized as part of the gains or losses on the extinction. When an exchange of debt instruments or a modification of conditions thereof is not recorded as an extinction, the costs and commissions will adjust the carrying amount of the liability and will be amortized throughout the remaining life of the modified liability.
Trade payables
Trade payables are payment obligations in respect of goods or services received from suppliers in the ordinary course of business. Trade payables falling due in twelve months or less are classified as current liabilities; otherwise, the balances are considered non-current liabilities.
Trade payables are initially recognized at fair value and subsequently measured at amortized cost using the effective interest method.
j) Derivative financial instruments and hedging
Derivative financial instruments are initially recognized at fair value at the date contractually arranged. The fair value is reassessed at each reporting date.
The accounting treatment for any gains or losses resulting from changes in the fair value of a derivative instrument qualifies as a hedge and, where applicable, the nature of the hedge relationship.
The Atento Group designates certain derivatives as cash flow hedges.
 
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At the inception of the hedge, the Atento Group documents the relationship between the hedging instruments and the hedged items, as well as the risk management objectives and strategy for groups of hedges. The Atento Group also documents its assessment, both at the inception of the hedge and throughout the term thereof, of whether the derivatives used are highly effective for offsetting changes in the fair value or in the cash flows of the hedged items.
The fair value of a hedging derivative is classified as a non-current asset or liability, as applicable, if the remaining maturity of the hedged item exceeds twelve months; otherwise, it is classified as a current asset or liability.
Cash flow hedges
The effective portion of the fair value of derivatives designated and classified as cash flow hedges is recognized in equity. Gains or losses in respect of the ineffective portion are taken to the income statement as incurred.
Amounts accumulated in equity are reclassified to the income statement in the periods in which the hedged item affects profit or loss.
When a hedging instrument matures or is sold, or when the requirements for hedge accounting are no longer met, any gain or loss accumulated in equity up until that moment remains in equity until the forecast transaction is definitively recognized in the income statement.
Derivatives which are not considered as hedging instruments
Variations in fair value of the derivative financial instruments that are not considered as hedging derivatives are recorded in the income statement.
k) Share capital
The ordinary shares of the Company are classified as equity (Note 19).
Incremental costs directly attributable to the issuance of new shares or options are deducted from proceeds raised in equity, net of the tax effect.
Whenever any Group company acquires shares in the Company (treasury shares), the consideration paid, including any directly attributable incremental cost (net of income taxes) is deducted from equity attributable to equity holders of the Company until the shares are cancelled, newly issued or sold. When these shares are subsequently reissued, all amounts received, net of any directly attributable incremental transaction cost and the corresponding income tax effect, are included in equity attributable to equity holders of the Company.
l) Grants received
Government grants are recognized as “Deferred income” under “Other non-trade payables” within the statement of financial position where there is reasonable assurance that the grant will be received and all attaching conditions will be complied with. The grants are released to income, as “Operating grants” classified under “Other operating income,” in the income statement in equal amounts over the useful life of the assets financed. When the grant relates to an expense item, it is recognized as income over the period necessary to match the grant to the costs that it is intended to compensate.
m) Provisions
Provisions are recognized when the Atento Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle
 
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the obligation and a reliable estimate can be made of the amount of the obligation. Provisions for restructuring include penalties for the cancellation of leases and other contracts, as well as compensation paid for employee dismissals. Provisions are not recognized for future operating losses.
When the Atento Group is virtually certain that some or all of a provision is to be reimbursed, for example under an insurance contract, a separate asset is recognized in the statement of financial position and the expense relating to the provision is taken to the income statement, net of the expected reimbursement.
Provisions are measured at the present value of the estimated expenditure necessary to settle the obligation, using a pre-tax rate that reflects the time value of money and the specific risks inherent in the obligation. Any increase in the provision due to the passage of time is recognized as a finance cost.
Contingent liabilities represent possible obligations with third parties and existing obligations that are not recognized given that it is not likely that an outflow of economic resources will be required in order to settle the obligation or because the amount cannot be reliably estimated. Contingent liabilities are not recognized on the consolidated statement of financial position unless they are acquired for consideration as part of a business combination.
n) Employee benefits
Pension obligations
The Atento Group has arranged defined contribution pension plans for employees in Mexico and Brasil. Under defined contribution plans, the Atento Group makes a set of contributions to a pension fund and bears no legal or implicit obligation to make additional contributions if the fund fails to hold sufficient assets to pay all employees the benefits corresponding to the services rendered in the present year and in prior years.
As part of its defined contribution plans, the Atento Group makes contributions to pension insurance plans managed publically or privately, on an obligatory, contractual or voluntary basis. Once the contributions have been made, the Atento Group has no additional payment obligations. The contributions are recognized as employee benefits when accrued. Benefits paid in advance are recognized as an asset insofar as they entail a cash reimbursement or a reduction in future payments.
Management Incentivation Plan
In 2013 the Shareholders of the Atento Group have established a management incentivation plan which is described in Note 26.
Termination benefits
Termination benefits are paid to employees when the Atento Group decides to terminate their employment contracts prior to the usual retirement age or when the employee agrees to voluntarily resign in exchange for these benefits. The Atento Group recognizes these benefits as an expense for the year, at the earliest of the following dates: (a) when the Atento Group is no longer able to withdraw the offer for these benefits; or (b) when the Atento Group company recognizes the costs of a restructuring effort as per IAS 37, Provisions, Contingent Liabilities and Contingent Assets, and when this restructuring entails the payment of termination benefits. When benefits are offered in order to encourage the voluntary resignation of employees, termination benefits are measured on the basis of the number of employees expected to accept the offer. Benefits to be paid in more than twelve months from the reporting date are discounted to their present value.
o) Income tax
This heading in the accompanying consolidated income statement includes all the expenses and credits arising from the corporate income tax levied on all the Atento Group companies.
 
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Income tax expense of each period is the aggregate amount of current and deferred taxes, if applicable.
Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted at the reporting date in each country in which the Atento Group operates.
Deferred taxes are calculated based on analysis of the statement of financial position, in consideration of temporary differences generated from differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.
The main temporary differences arise due to differences between the tax bases and carrying amounts of plant, property and equipment, intangible assets, goodwill and non-deductible provisions, as well as differences between the fair value and tax bases of net assets acquired from a subsidiary.
Furthermore, deferred tax assets arise from unused tax credits and tax loss carryforwards.
Atento Group determines deferred tax assets and liabilities by applying the tax rates that will be effective when the corresponding asset is received or the liability settled, based on tax rates and tax laws that are enacted (or substantively enacted) at the reporting date.
The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of that deferred tax asset to be utilized. Unrecognized deferred income tax assets are reassessed at each reporting date and are recognized to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.
Deferred tax liabilities associated with investments in subsidiaries and branches are not recognized when the timing of the reversal can be controlled by the parent company and it is probable that the temporary differences will not reverse in the foreseeable future.
Deferred income tax relating to items directly recognized in equity is also recognized in equity. Deferred tax assets and liabilities resulting from business combinations are added to or deducted from goodwill.
Deferred tax assets and liabilities are offset only if a legally enforceable right exists to set off current tax assets against current income tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority.
p) Revenue and expense
Revenue and expenses are recognized on the income statement on an accrual basis; i.e. when the goods or services represented by them take place, regardless of when actual payment or collection occurs.
Revenue is measured at the fair value of the consideration received or to be received, and represents amounts to be collected for goods or services sold, net of discounts, returns and value added tax. Revenues are recognized when the income can be reliably measured, when it is probable that the Company will receive a future economic benefit, and when certain conditions are met for each Group activity carried out.
Services sales are recognized in the accounting period in which the services are rendered, by reference to the percentage completion, when the revenues and costs of the services contract, as well as the stage of completion thereof, can be reliably estimated and it is probable that the related receivables will be recovered. When one or more of these service contract elements cannot be reliably estimated, revenues from the sale of services are recognized only up to the contract costs incurred for which recovery is deemed probable.
 
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The Atento Group obtains revenue mainly from the provision of customer services, recognizing the revenue when the teleoperation occurs (based on the stage of completion of the service provided) or when certain contact center consulting work is carried out.
Expenses are recognized in the income statement on an accrual basis; i.e. when the goods or services represented by them take place, regardless of when actual payment or collection occurs.
Atento Group’s incorporation, start-up and research expenses, as well as expenses that do not qualify for capitalization under IFRS, are recognized in the consolidated income statement when incurred and classified in accordance with their nature.
q) Interest income and expense
Interest expense incurred in the construction of any qualified asset is capitalized during the time necessary to complete the asset and prepare it for the intended use. All other interest expenditure is expensed in the year incurred.
Interest income is recognized using the effective interest method. When a loan or a receivable has been impaired, the carrying amount is reduced to the recoverable amount, discounting the estimated future cash flows at the instrument’s original effective interest rate and recognizing the discount as a decrease in interest income. Interest income on impaired loans is recognized when the cash is collected or on the basis of recovery of the cost when the loan is secured.
r) Leases (as lessee)
Leases where the lessor does not transfer substantially all the risks and benefits of ownership of the asset are classified as operating leases. Operating lease payments are recognized as an expense in the income statement on a straight-line basis over the lease term.
The Atento Group rents certain properties. Those lease arrangements under which the Atento Group holds the significant risks and benefits inherent in owning the leased item are treated as finance leases. Finance leases are capitalized as an asset at the inception of the lease period and classified according to their nature. The related debt is recorded at the lower of the present value of the minimum lease payments agreed and the fair value of the leased asset. Lease payments are proportionally assigned to reduce the principal of the lease liability and to cover the related finance charge. Finance charges are reflected on the income statement over the lease term so as to achieve a constant rate of interest on the balance pending repayment in each period.
s) Use of estimates and judgments in the recognition of assets and liabilities
The preparation of consolidated financial statements under IFRS requires the use of certain assumptions and estimates that affect the recognized amount of assets, liabilities, income, and expenses, as well as the related breakdowns.
Some of the accounting policies applied in preparing the accompanying consolidated financial statements required Management to apply significant judgments in order to select the most appropriate assumptions for determining these estimates. These assumptions and estimates are based on Management’s experience, the advice of consultants and experts, forecasts and other circumstances and expectations prevailing at year end. Management’s evaluation takes into account the global economic situation in the sector in which the Atento Group operates, as well as future outlooks for the business. By virtue of their nature, these judgments are inherently subject to uncertainty. Consequently, actual results could differ substantially from the estimates and assumptions used. Should this occur, the values of the related assets and liabilities would be adjusted accordingly.
 
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At the date of preparation of these consolidated financial statements, no relevant changes are forecasted in the estimates. As a result, no significant adjustments in the values of the assets and liabilities recognized at December 31, 2012 and 2013 are expected.
Although these estimates were made on the basis of the best information available at each reporting date on the events analyzed, events that take place in the future might make it necessary to change these estimates in coming years. Changes in accounting estimates would be applied prospectively in accordance with the requirements of IAS 8, Accounting Policies, Change in Accounting Estimates and Errors, recognizing the effects of the change in estimates in the related consolidated income statement.
An explanation of the estimates and judgments that entail significant risk of leading to a material adjustment in the carrying amounts of assets and liabilities in the coming financial year is as follows:
Revenue recognition
The Atento Group recognizes revenues on an accrual basis during the period in which the services are rendered, by reference to the stage of completion of the specific transaction and assessed on the basis of the actual service provided as a proportion of the total service to be provided, as described in Note 3.p. above. Recognizing service revenue by reference to the stage of completion involves the use of estimates in relation to certain key elements of the service contracts, such as contract costs, period of execution and allowances related to the contracts. As far as practicable the Atento Group applies past experience and specific quantitative indicators in its estimates, considering the specific circumstances applicable to specific customers or contracts. If certain circumstances have occurred that may have an impact on the initially estimated revenue, costs or percentage of completion, estimates are reviewed based on such circumstances. Such reviews may result in adjustments to costs and revenue recognized for a period.
Useful life of property, plant and equipment and intangible assets
The accounting treatment of items of property, plant and equipment and intangible assets entails the use of estimates to determine their useful life for depreciation and amortization purposes. In determining useful life, it is necessary to estimate the level of use of assets as well as forecast technological trends in the assets. Assumptions regarding the level of use, the technological framework and the future development require a significant degree of judgment, bearing in mind that these aspects are rather difficult to foresee. Changes in the level of use of assets or in their technological development could result in a modification of their useful lives and, consequently, in the associated depreciation or amortization.
Estimated impairment of goodwill
The Atento Group tests goodwill for impairment annually, in accordance with the accounting principle described in Note 3 h. Goodwill is subject to impairment testing as part of the cash-generating unit to which it has been allocated. The recoverable amounts of cash-generating units defined in order to identify potential impairment in goodwill are determined on the basis of value in use, applying five-year financial forecasts based on the Atento Group’s strategic plans, approved and reviewed by Management. These calculations entail the use of assumptions and estimates, and require a significant degree of judgment. The main variables considered in the sensitivity analyses are growth rates, discount rates using the weighted average cost of capital (WACC) and the key business variables.
Deferred taxes
The Atento Group assesses the recoverability of deferred tax assets based on estimates of future earnings. The ability to recover these deferred amounts depends ultimately on the Atento Group’s ability to generate taxable earnings over the period in which the deferred tax assets remain deductible. This analysis is based on the estimated timing of the reversal of deferred tax liabilities, as well as estimates of taxable earnings, which are sourced from internal projections and are continuously updated to reflect the latest trends.
 
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The appropriate classification of tax assets and liabilities depends on a series of factors, including estimates as to the timing and realization of deferred tax assets and the projected tax payment schedule. Actual income tax receipts and payments could differ from the estimates made by the Atento Group as a result of changes in tax legislation or unforeseen transactions that could affect tax balances (see Note 20).
The Atento Group has recognized tax credits corresponding to loss carry forwards since based on internal projections it is probable there will be future taxable profits against which they may be utilized.
The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of that deferred tax asset to be utilized. Unrecognized deferred income tax assets are reassessed at each reporting date and are recognized to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.
Provisions
Provisions are recognized when the Atento Group has a present obligation as a result of a past event, it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. This obligation may be legal or constructive, deriving from, inter alia, regulations, contracts, customary practice or public commitments that lead third parties to reasonably expect that the Atento Group will assume certain responsibilities. The amount of the provision is determined based on the best estimate of the outlay required to settle the obligation, bearing in mind all available information at the reporting date, including the opinions of independent experts such as legal counsel or consultants.
No provision is recognized if the amount of liability cannot be estimated reliably. In such a case, the relevant information would be provided in the notes to the consolidated financial statements.
Given the uncertainties inherent in the estimates used to determine the amount of provisions, actual outflows of resources may differ from the amounts recognized originally on the basis of the estimates (see Note 21).
Fair value of derivatives and CVIs
The Atento Group uses derivative financial instruments to mitigate risks, primarily derived from possible fluctuations in interest rates on loans received. Derivatives are recognized at the onset of the contract at fair value, subsequently re-measuring the fair value and adjusting as necessary at each reporting date.
The fair value of derivative financial instruments is calculated on the basis of observable market data available, either in respect of market prices or through the application of valuation techniques (Level 2). The valuation techniques used to calculate the fair value of derivative financial instruments include the discounting of future cash flows associated with the instruments, applying assumptions based on market conditions at the valuation date or using prices established for similar instruments, among others. These estimates are based on available market information and appropriate valuation techniques. The fair values calculated could differ significantly if other market assumptions and/or estimation techniques were applied.
Discounted cash flow analyses, are used to analyze the fair value of the contingent-value instruments (“CVI”) (Level 3). The fair value of the CVIs are based upon discounted cash flow analyses for which the determination of fair value requires significant management judgment or estimation and result in a higher degree of financial statement volatility.
t) Consolidation method
All subsidiaries are fully consolidated. Intragroup income and expense are eliminated on consolidation, as are all receivables and payables between Group companies. Gains and losses arising on intragroup transactions are also eliminated. Where necessary, the accounting policies of subsidiaries have been brought into line with those adopted in the Atento Group.
 
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Details of Atento Group subsidiaries at December 31, 2012 and 2013 are as follows:

Name	 	Registered
address	 	Line of business	 	Functional
currency	 	% interest  1	 	Holding company	
Atento Luxco 1, S.A.	 	Luxembourg	 	Holding company	 	EUR	 	100	 	Atalaya Luxco Midco, S.a.R.L.	
Atalaya Luxco 2, S.a.r.l.	 	Luxembourg	 	Holding company	 	EUR	 	100	 	Atento Luxco 1, S.A.	
Atalaya Luxco 3, S.a.r.l.	 	Luxembourg	 	Holding company	 	EUR	 	100	 	Atento Luxco 1, S.A.	
	 		 		 		 		 	Atalaya Luxco 2, S.a.r.l.	
Atento Argentina, S.A.	 	Buenos Aires (Argentina)	 	Operation of call centers	 	ARS	 	90
10	 	Atalaya Luxco 3, S.a.r.l.	
	 		 		 		 		 	Atalaya Luxco 2, S.a.r.l.	
Atusa, S.A.	 	Buenos Aires (Argentina)	 	Operation of call centers	 	ARS	 	90
10	 	Atalaya Luxco 3, S.a.r.l.	
	 		 		 		 		 	Atalaya Luxco 2, S.a.r.l.	
Microcentro de Contacto, S.A.	 	Buenos Aires (Argentina)	 	Operation of call centers	 	ARS	 	90
10	 	Atalaya Luxco 3, S.a.r.l.	
	 		 		 		 		 	Atalaya Luxco 2, S.a.r.l.	
Córdoba de Gestiones y
Contactos, S.A.	 	 
Buenos Aires (Argentina)	 	 
Operation of call centers	 	 
ARS	 	 
90
10	 	 
Atalaya Luxco 3, S.a.r.l.	
	 		 		 		 		 	Atalaya Luxco 2, S.a.r.l.	
Centros de Contacto Salta, S.A.	 	Buenos Aires (Argentina)	 	Operation of call centers	 	ARS	 	90
10	 	Atalaya Luxco 3, S.a.r.l.	
	 		 		 		 		 	Atalaya Luxco 2, S.a.r.l.	
Mar de Plata Gestiones y
Contactos, S.A.	 	 
Buenos Aires (Argentina)	 	 
Operation of call centers	 	 
ARS	 	 
90
10	 	 
Atalaya Luxco 3, S.a.r.l.	
Atento Spain Holdco, S.L.U.	 	Madrid (Spain)	 	Holding company	 	EUR	 	100	 	Atento Luxco 1, S.A.	
Atento B V	 	Amsterdam (Netherlands)	 	Operation of call centers	 	EUR	 	100	 	Atento Spain Holdco 2, S.L.U.	
Atento Teleservicios España, S.A.U.	 	Madrid (Spain)	 	Operation of call centers	 	EUR	 	100	 	Atento Spain Holdco 2, S.L.U.	
Atento Servicios Técnicos y Consultoría S.A.U.	 	 
Madrid
(Spain)	 	 
Execution of technological projects and services, and consultancy services	 	 
EUR	 	 
100	 	 
Atento Teleservicios España S.A.U.	
Atento Impulsa, S.A.U	 	Barcelona (Spain)	 	Management of specialized employment centers for disabled workers	 	EUR	 	100	 	Atento Teleservicios España S.A.U.	
Atento Servicios Auxiliares de Contact Center, S.A.U.	 	 
Madrid (Spain)	 	 
Execution of technological projects and services, and consultancy services	 	 
EUR	 	 
100	 	 
Atento Teleservicios España, S.A.U.	
Atento Maroc, S.A.	 	Casablanca (Morocco)	 	Operation of call centers	 	MAD	 	99.9991	 	Atento Teleservicios España S.A.U.	
Contact US Teleservices Inc	 	Houston, Texas (USA)	 	Operation of call centers	 	USD	 	100	 	Atento Mexicana, S.A. de C.V.	
Atento Brasil, S.A.	 	São Paulo (Brazil)	 	Operation of call centers	 	BRL	 	99.999	 	Atento Spain Holdco 4, S.A.U.	
Atento Spain Holdco 4, S.A.U. 2	 	Madrid (Spain)	 	Holding company	 	EUR	 	100	 	Atento Spain Holdco, S.L.U.	
	 		 		 		 	83.3333	 	Atento B.V.	
Teleatento del Perú, S.A.C.	 	Lima (Peru)	 	Operation of call centers	 	PEN	 	16.6667	 	Atento Holding Chile, S.A.	
	 		 		 		 	94.97871	 	Atento B.V.	
	 		 		 		 	0.00424	 	Atento Servicios Auxiliares de Contact Center, S.L.U.	
	 		 		 		 	0.00854	 	Atento Servicios Técnicos y Consultoría, S.L.U	
	 		 		 		 	5.004270	 	Atento Teleservicios España, S.A.U.	
 
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Name	 	Registered
address	 	Line of business	 	Functional
currency	 	% interest  1	 	Holding company	
Atento Colombia, S.A.	 	Bogota DC
(Colombia)	 	Operation of call centers	 	COP	 	0.00424	 	Teleatento del Perú, S.A.C.	
Atento Holding Chile, S.A.	 	Santiago de Chile
(Chile)	 	Holding company	 	CLP	 	99.9999	 	Atento B.V.	
Atento Chile, S.A.	 	Santiago de Chile
(Chile)	 	Operation of call centers	 	CLP	 	99.99	 	Atento Holding Chile, S.A.	
	 		 		 		 	99	 	Atento Chile, S.A.	
Atento Educación Limitada	 	Santiago de Chile
(Chile)	 	Operation of call centers	 	CLP	 	1	 	Atento Holding Chile, S.A.	
	 		 		 		 	99	 	Atento Chile, S.A.	
Atento Centro de Formación Técnica Limitada	 	 
Santiago de Chile
(Chile)	 	 
Operation of call centers	 	 
CLP	 	 
1	 	 
Atento Holding Chile, S.A.	
Atento Puerto Rico, Inc.	 	Guaynabo
(Puerto
Rico)	 	Operation of call centers	 	USD	 	100	 	BC Atalaya Mexholdco, S.A.	
Atento Mexicana, S.A. de C.V.	 	Mexico City
(Mexico)	 	Operation of call centers	 	MXN	 	99.99	 	BC Atalaya Mexholdco, S.A.	
	 		 		 		 	99.9995	 	Atento Mexicana, S.A. de C.V.	
Atento Servicios, S.A. de C.V.	 	Mexico City
(Mexico)	 	Sale of goods and services	 	MXN	 	0.0005	 	Atento Atención y Servicios, S.A. de C.V.	
	 		 		 		 	99.998	 	Atento Mexicana, S.A. de C.V.	
Atento Atención y Servicios, S.A. de C.V.	 	 
Mexico City
(Mexico)	 	 
Administrative, professional and consultancy services	 	 
MXN	 	 
0.002	 	 
Atento Servicios, S.A. de C.V.	
	 		 		 		 	99.9999	 	Atento Mexicana, S.A. de C.V.	
Atento Centroamérica, S.A.	 	Guatemala
(Guatemala)	 	Holding company	 	GTQ	 	0.0001	 	Atento El Salvador S.A. de C.V.	
	 		 		 		 	99.99999	 	Atento Centroamérica, S.A.	
Atento de Guatemala, S.A.	 	Guatemala
(Guatemala)	 	Operation of call centers	 	GTQ	 	0.00001	 	Atento El Salvador S.A. de C.V.	
	 		 		 		 	7.4054	 	Atento Centroamerica, S.A.	
Atento El Salvador, S.A. de C.V.	 	City of San Salvador
(El Salvador)	 	Operation of call centers	 	USD	 	92.5946	 	Atento de Guatemala, S.A.	
Woknal, S.A.	 	Montevideo
(Uruguay)	 	Operation of call centers	 	UYU	 	100	 	Atento B.V.	
BC Atalaya Mexholdco, S.A. de C.V.	 	Mexico	 	Holding company	 	MXN	 	99.9667	 	Atento Spain Holdco 5, S.L.U.	
Atento Spain Holdco 5, S.L.U. 2	 	Madrid
(Spain)	 	Holding company	 	EUR	 	100	 	Atento Spain Holdco, S.L.U.	
Atento Ceská Republika, a.s.	 	Prague
(Czech Republic)	 	Telemarketing and other financial and business services	 	CZK	 	100	 	Atento Spain Holdco, S.L.U.	
	 		 		 		 	99	 	BC Atalaya Mexholdco, S.A.	
Atento Panamá, S.A.	 	Panama City	 	Operation of call centers	 	USD	 	1	 	Atento Mexicana, S.A. de C.V.	
Atento Spain Holdco 2, S.L.U. 2	 	Madrid
(Spain)	 	Holding company	 	EUR	 	100	 	Atento Spain Holdco 6, S.L.U.	
Atento Spain Holdco 6, S.L.U. 2	 	Madrid
(Spain)	 	Holding company	 	EUR	 	100	 	Atento Spain Holdco, S.L.U.	
Global Rossolimo, S.L.U. (2)	 	Madrid
(Spain)	 	Holding company	 	EUR	 	100	 	Atento Spain Holdco, S.L.U.	

(1)	Shareholdings with voting rights.	
(2)	Not audited.	
 
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At December 31, 2012 and 2013, none of the subsidiaries is listed on a stock exchange and all use December 31 as their reporting date.
All Group companies subject to statutory audit as per local legislation have been audited.
u) New and amended standards and interpretations
The new and amended standards and interpretations issued by the IASB that have entered into force and been applied by the Atento Group during the year are as follows:

New and amended standards and interpretations	  	 	
IFRS 10	  	Consolidated Financial Statements	
IFRS 11	  	Joint Arrangements	
IFRS 12	  	Disclosure of Interests in Other Entities	
IFRS 13	  	Fair Value Measurement	
Revised IAS 19	  	Employee Benefits	
Amendment to IFRS 7	  	Financial Instruments: Disclosures—Offsetting Financial Assets and Financial Liabilities	
Amendment to IFRS 10,11 and 12	  	Transition Guidance	
Amendment to IAS 1	  	Presentation of items of Other Comprehensive Income	
Amendment to IAS 27	  	Separate Financial Statements	
Amendment to IAS 28	  	Investment in Associates and Joint Ventures	
Annual Improvements to IFRSs-2009-2011 Cycle	  		
These standards have not had a significant effect on the Atento Group’s consolidated financial statements, with the exception of modifications in presentation and disclosures that have been included in the Atento Group’s consolidated financial statements.
New and amended standards and interpretations that have yet to enter into force and that have not been adopted early by the Atento Group
At the date of these consolidated financial statements, the IASB has issued the following new and amended standards and interpretations, which enter into force for accounting periods beginning on or after January 1, 2014 and that the Atento Group has not early adopted:

New and amended standards and interpretations	  	Effective date	
Amendment to IAS 32	  	Financial Instruments: Presentation—Offsetting Financial Assets and Financial Liabilities	  	January 1, 2014	
Amendments to IFRS 10 and 11 and IAS 27	  	Investment Entities	  	January 1, 2014	
Amendment to IAS 39	  	Novation of Derivatives and Continuation of Hedge Accounting	  	January 1, 2015	
IFRS 9	  	Financial Instruments	  	January 1, 2018	
IFRS 14	  	Regulators deferred accounts	  	January 1, 2016	
Amendments to IAS 19	  	Defined Benefit Plans. Employee Benefits	  	July 1, 2014	
Annual Improvements to IFRSs-2010-2012 Cycle	  	July 1, 2014	
Annual Improvements to IFRSs-2011-2013 Cycle	  	July 1, 2014	
IFRIC 21	  	Levies	  	January 1, 2014	
 
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The Atento Group is currently analyzing the impact of applying these new and amended standards and interpretations. Based on the analyses conducted to date, the Atento Group estimates that the application of the new and amended standards and interpretations will not have a material impact on the consolidated financial statements in the period of their initial application.
New and amended standards and interpretations that have yet to enter into force and that have been adopted early by the Atento Group
The Atento Group has proactively adopted the amendment to IAS 36 “Recoverable Amount Disclosures for Non-Financial Assets” in advance of the effective date of January 1, 2014 (see Note 8), as it has also applied IFRS 13 “Fair Value Measurement”.
4) MANAGEMENT OF FINANCIAL RISK
4.1 Financial risk factors
The Atento Group’s activities expose it to various types of financial risk: market risk (including currency risk, interest rate risk and country risk), credit risk and liquidity risk. The Atento Group’s global risk management policy aims to minimize the potential adverse effects of these risks on the Atento Group’s financial returns. The Atento Group also uses derivative financial instruments to hedge certain risk exposures.
a) Market risk
Interest rate risk in respect of cash flows and fair value
Interest rate risk arises mainly as a result of changes in interest rates which affect: (i) finance costs of debt bearing interest at variable rates (or short-term maturity debt expected to be renewed), as a result of fluctuations in interest rates; and (ii) the value of non-current liabilities that bear interest at fixed rates.
At December 31, 2013 43.2% of financial debt with third parties (excluding CVIs and the effect of financial derivative instruments) bear interests at variable rates while at December 31, 2012 this amount was up to 80.5%.
The Atento Group’s finance costs are exposed to fluctuations in interest rates. In 2013, the rates to which the Atento Group had the greatest exposure were the Brazilian CDI rate. In 2012, the Atento Group had the greatest exposure to the Euribor, the Brazilian CDI rate and the Mexican TIIE rate.
The Atento Group’s policy is to monitor exposure to this risk. In that regard, as described in Note 14, the Atento Group has arranged interest rate swaps that have the economic effect of converting floating-rate borrowings into loans at fixed interest rates.
The table below shows the impact on the value of derivatives of a +/-10 basis points variation in the CDI interest rate curves.

INTEREST RATE	  	12/31/2013	 	
FAIR VALUE	  	 	15,611	  	
+0.1%	  	 	14,817	  	
-0.1%	  	 	16,407	  	
Also, as described in Note 14, the Atento Group has cross-currency swap hedging instruments with the economic effect of covering cash flows related to the Senior Secured Notes issued in U.S. dollars.
Additionally, the Atento Group holds derivatives which are not considered as hedging instruments related to the cash flows generated in Mexican Pesos, Colombian Pesos and Peruvian Nuevos Soles.
 
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The table below shows the impact on the value of derivatives of a +/-10 basis points variation in the interest rate curve.

CROSS CURRENCY (thousands of U.S. dollars)	  	12/31/2013	 	
FAIR VALUE	  	 	(13,277	) 	
+0.1%	  	 	(14,719	) 	
-0.1%	  	 	(11,658	) 	
Foreign currency risk
At December 31, 2013 and 2012, the Atento Group entities held several borrowings and cash and cash equivalents in currencies other than their functional currency.
The most significant exposure to foreign currency risk is derived from the U.S. dollar denominated Senior Secured Notes issued by the subsidiary Atento Luxco 1, S.A. in 2013 whose functional currency is the euro. As indicated above, the Atento Group has cross-currency swap hedging instruments with the economic effect of covering cash flows related to the Senior Secured Notes issued in U.S. dollars.
 
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Sensitivity analysis of foreign currency risk
The Atento Group has reasonable control over its foreign currency risks, as its financial assets and financial liabilities denominated in currencies other than their functional are adequately matched. A sensitivity analysis based on the outstanding volume of financial assets and liabilities (applying a 10% appreciation of each asset/liability currency versus the functional currency) highlights the limited impact that such event would have on the income statement is U.S. dollars.

2012	 	Financial assets	 	 	Financial liabilities	 	 	Sensitivity analysis	 	
Functional currency-
financial asset/liability
currency	 	Functional
currency
(thousands)	 	 	Asset
currency
(thousands)	 	 	U.S. Dollar
(thousands)	 	 	Functional
currency
(thousands)	 	 	Liability
currency
(thousands)	 	 	U.S. Dollar
(thousands)	 	 	Appreciation of
asset/liability
currency vs
functional
currency	 	 	Appreciation
of financial
assets in
functional
currency	 	 	Income
statement
profit/(loss)
(thousands of
U.S. Dollar)	 	 	Appreciation
of financial
liabilities in
functional
currency
(thousands of
U.S. Dollars)	 	 	Income
statement
profit/(loss)
(thousands of
U.S. Dollar)	 	
Uruguayan pesos—USD	 	 	—	  	 	 	—	  	 	 	—	  	 	 	12,618	  	 	 	650	  	 	 	650	  	 	 	10	% 	 	 	0.04639414	  	 	 	—	  	 	 	—	  	 	 	14,010	  	 	 	(72	) 	
Chilean pesos—USD	 	 	26,916	  	 	 	56	  	 	 	56	  	 	 	61,151	  	 	 	128	  	 	 	128	  	 	 	10	% 	 	 	0.00187516	  	 	 	29,907	  	 	 	6	  	 	 	68,261	  	 	 	(15	) 	
Argentinian pesos—USD	 	 	—	  	 	 	—	  	 	 	—	  	 	 	487	  	 	 	99	  	 	 	99	  	 	 	10	% 	 	 	0.18300122	  	 	 	—	  	 	 	—	  	 	 	541	  	 	 	(11	) 	
Euro—Argentinian pesos (CVI)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	39,620	  	 	 	257,087	  	 	 	52,275	  	 	 	10	% 	 	 	5.8399465	  	 	 	—	  	 	 	—	  	 	 	35,637	  	 	 	(5,808	) 	
Colombian pesos—USD	 	 	216,885	  	 	 	123	  	 	 	123	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	10	% 	 	 	0.000508984	  	 	 	240,983	  	 	 	14	  	 	 	—	  	 	 	—	  	
Guatemalan Quetzal—USD	 	 	6,327	  	 	 	801	  	 	 	801	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	10	% 	 	 	0.113890893	  	 	 	7,030	  	 	 	89	  	 	 	—	  	 	 	—	  	
Mexican pesos—USD	 	 	17,997	  	 	 	1,388	  	 	 	1,388	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	10	% 	 	 	0.06941338	  	 	 	19,997	  	 	 	154	  	 	 	—	  	 	 	—	  	
Chilean Pesos—EUR	 	 	319,433	  	 	 	504	  	 	 	666	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	10	% 	 	 	0.001421217	  	 	 	354,925	  	 	 	74	  	 	 	—	  	 	 	—	  	
Peruvian nuevos soles—USD	 	 	1,028	  	 	 	403	  	 	 	403	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	10	% 	 	 	0.353148911	  	 	 	1,142	  	 	 	45	  	 	 	—	  	 	 	—	  	
Euro—USD	 	 	50	  	 	 	66	  	 	 	66	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	10	% 	 	 	1.187460418	  	 	 	56	  	 	 	7	  	 	 	—	  	 	 	—	  	

2013	 	Financial assets	 	 	Financial liabilities	 	 	Sensitivity analysis	 	
Functional currency-
financial asset/liability
currency	 	Functional
currency
(thousands)	 	 	Asset
currency
(thousands)	 	 	U.S. Dollar
(thousands)	 	 	Functional
currency
(thousands)	 	 	Liability
currency
(thousands)	 	 	U.S. Dollar
(thousands)	 	 	Appreciation of
asset/liability
currency vs
functional
currency	 	 	Appreciation
of financial
assets in
functional
currency	 	 	Income
statement
profit/(loss)
(thousands of
U.S. Dollar)	 	 	Appreciation
of financial
liabilities in
functional
currency	 	 	Income
statement
profit/(loss)
(thousands of
U.S. Dollar)	 	
Euro—USD	 	 	2,909	  	 	 	4,011	  	 	 	4.011	  	 	 	215,852	  	 	 	297,681	  	 	 	297,681	  	 	 	10	% 	 	 	1.24118928	  	 	 	3,232	  	 	 	446	  	 	 	239,835	  	 	 	(33,075	)	
Peruvian nuevos soles—USD	 	 	1,748	  	 	 	625	  	 	 	625	  	 	 	3,795	  	 	 	1,357	  	 	 	1,257	  	 	 	10	% 	 	 	0.32183086	  	 	 	1,943	  	 	 	69	  	 	 	4,217	  	 	 	(151	)	
Uruguayan pesos—USD	 	 	7,507	  	 	 	351	  	 	 	351	  	 	 	3,540	  	 	 	165	  	 	 	165	  	 	 	10	% 	 	 	0.0420777	  	 	 	8,341	  	 	 	39	  	 	 	3,921	  	 	 	(18	)	
Argentinian pesos—USD	 	 	—	  	 	 	—	  	 	 	—	  	 	 	27	  	 	 	4	  	 	 	4	  	 	 	10	% 	 	 	0.13801564	  	 	 	—	  	 	 	—	  	 	 	29	  	 	 	—	  	
Euro—Argentinian pesos (CVI)	 	 	—	  	 	 	—	  	 	 	—	  	 	 	31,446	  	 	 	282,798	  	 	 	43,367	  	 	 	10	% 	 	 	8.09381632	  	 	 	—	  	 	 	—	  	 	 	34,940	  	 	 	(4,819	) 	
Mexican pesos—Euro	 	 	56,724	  	 	 	3,144	  	 	 	4,335	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	10	% 	 	 	0.04987656	  	 	 	63,027	  	 	 	482	  	 	 	—	  	 	 	—	  	
Mexican pesos—USD	 	 	34,488	  	 	 	2,636	  	 	 	2,636	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	10	% 	 	 	0.068784727	  	 	 	38,320	  	 	 	293	  	 	 	—	  	 	 	—	  	
Colombian pesos—USD	 	 	361,010	  	 	 	187	  	 	 	187	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	10	% 	 	 	0.000467088	  	 	 	401,122	  	 	 	21	  	 	 	—	  	 	 	—	  	
Guatemalan Quetzal—USD	 	 	2,168	  	 	 	276	  	 	 	276	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	10	% 	 	 	0.114775862	  	 	 	2,409	  	 	 	31	  	 	 	—	  	 	 	—	  	
Euro—Mexican pesos	 	 	86	  	 	 	1,559	  	 	 	119	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	10	% 	 	 	16.24009354	  	 	 	96	  	 	 	13	  	 	 	—	  	 	 	—	  	

*	Financial liabilities correspond to borrowings in currencies other than functional currencies (Senior Secured Notes, Finance Leases and CVIs). Financial Assets correspond to cash and cash equivalents in currencies other than functional currencies. Example of the income statement impact of appreciation of the asset/liability currency versus the functional currency. When conducting this sensitivity analysis, assuming a depreciation, the income statement impact would be the same, but precisely reversed.	
 
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Country risk
To manage or mitigate country risk, the Atento Group repatriates the funds generated in Americas and Brazil that are not required to pursue new, profitable business opportunities in the region. The capital structure of the Atento Group comprises two separate ring-fenced financings: (i) the Brazilian Debentures denominated in Brazilian reais and (ii) the USD 300 million 7.375% Senior Secured Notes due 2020, together with the €50 million ($69 million) Revolving Credit Facility. The objective of combining a Brazilian term loan with a USD bond is to create a natural hedge for the interest payments on the Brazilian loan which are served with cash flows from Atento Brazil denominated in Brazilian reais.
Argentine subsidiaries sit outside of these two separate ring-fenced financings, and as a result, we do not rely on cash flows from these operations to serve our Company’s debt commitments.
b) Credit risk
The Atento Group seeks to conduct all its business with reputable national and international companies and institutions of established solvency in their countries of origin, so as to minimize credit risk. As a result of this policy, the Atento Group has no material adjustments to make to its trade accounts (see Note 13 on impairment allowances).
The Atento Group’s maximum exposure to credit risk on financial assets is the carrying amount of the instruments. The Atento Group holds no guarantees as collection insurance.
Accordingly, the Atento Group’s commercial credit risk management approach is based on continuous monitoring of the risk assumed and the financial resources necessary to manage the Group’s various units, in order to optimize the risk-reward relationship in the development and implementation of business plans applied in their ordinary management.
Credit risk arising from cash and cash equivalents is managed by placing cash surpluses in high quality and highly liquid money-market assets. These placements are regulated by a master agreement revised annually on the basis of conditions prevailing in the markets and the countries where Atento operates. The master agreement establishes: (i) the maximum amounts to be invested per counterparty, based on their ratings (long- and short-term debt rating); (ii) the maximum period of the investment; and (iii) the instruments in which the surpluses may be invested.
The Atento Group’s maximum exposure to credit risk is primarily limited to the carrying amounts of its financial assets (see Notes 11, 12, 13, 14 and 15). As disclosed in Note 23, the Atento Group carries out significant transactions with Telefónica Group. At December 31, 2013 the balance of accounts receivable with Telefónica Group amounted to 302,234 thousand U.S. dollars (303,668 thousand U.S. dollars in 2012).
c) Liquidity risk
The Atento Group seeks to match its debt maturity schedule to its capacity to generate cash flows to meet the payments falling due, factoring in a comfortable cushion. In practice, this has meant that the Atento Group’s average debt maturity must be longer than the length of time required to pay its debt (assuming that internal projections are met). A maturity schedule for the Atento Group’s financial liabilities is provided in Note 16.
4.2 Capital Management
The Atento Group’s Finance Department, which is in charge of the Atento Group’s capital management, takes various factors into consideration when determining the Atento Group’s capital structure.
The Atento Group’s capital management goal is to determine the financial resources necessary both to continue its recurring activities and to maintain a capital structure that optimizes own and borrowed funds.
 
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The Atento Group sets an optimal debt level in order to maintain a flexible and comfortable medium-term borrowing structure, so the Atento Group can carry out its routine activities under normal conditions and also address new opportunities for growth. Debt levels are kept in line with forecasted future cash flows and with quantitative restrictions imposed under financing contracts.
In addition to these general guidelines, other considerations and specifics are taken into account when determining the Atento Group’s financial structure, such as country risk in the broadest sense, tax efficiency and volatility in cash flow generation.
As indicated in Note 17, among the restrictions imposed under financing arrangements, the debentures contract lays out certain general obligations and disclosures in respect of the lending institutions. Specifically, the borrower (BC Brazilco Participações, S.A., which has now merged with Atento Brasil, S.A.) must comply with the quarterly net financial debt/EBITDA ratio set out in the contract terms.
The contract also sets out additional restrictions, including limitations on dividends, payments and distributions to shareholders and capacity to incur additional debt.
The Super Senior Revolving Credit Facility, also described in Note 17, carries no financial covenant obligations regarding debt level. However, the credit facility does impose limitations on the use of the funds, linked to compliance with a debt ratio. The contract also includes other restrictions, including the following: limitations on the distribution of dividends, payments or distributions to shareholders, the capacity to incur additional debt, investments and disposal of assets.
The Senior Secured Notes issued in 2013 carries no limitation covenant obligations regarding debt level. However, the Notes do impose limitations on the distributions on dividends, payment or distributions to the shareholders, incur additional debt, investments and disposals of assets.
At the date of these consolidated financial statements, the Atento Group complies with all restrictions established in the aforementioned financing contracts, and does not foresee any future non-compliance. To that end, the Atento Group regularly monitors figures for net financial debt with third parties and EBITDA.
The reconciliation between EBITDA and the consolidated income statement is as follows:

 	  	December 1 to
December 31, 2012	 	 	For the year ended
December 31, 2013	 	
Loss for the period/year	  	 	(56,620	) 	 	 	(4,039	) 	
Income tax	  	 	8,132	  	 	 	8,346	  	
Net finance income/(expense)	  	 	6,044	  	 	 	100,667	  	
Amortization and depreciation	  	 	7,500	  	 	 	128,975	  	
	  	 	 	 	 	 	 	 	
EBITDA	  	 	(34,944	) 	 	 	233,949	  	
	  	 	 	 	 	 	 	 	
Net financial debt with third parties at December 31, 2012 and 2013 is as follows:

 	  	12/31/2012	 	 	12/31/2013	 	
Senior Secured Notes (Note 17)	  	 	—	  	 	 	297,681	  	
Brazilian bonds—Debentures (Note 17)	  	 	442,955	  	 	 	345,854	  	
Bank borrowings (Note 17)	  	 	200,112	  	 	 	632	  	
Finance lease payables (Note 17)	  	 	8,696	  	 	 	11,877	  	
CVIs (Note 17)	  	 	52,275	  	 	 	43,367	  	
Vendor Loan (Note 17)	  	 	145,134	  	 	 	151,701	  	
Derivative financial liabilities (Note 14)	  	 	—	  	 	 	15,962	  	
Less: Cash and cash equivalents (Note 15)	  	 	(200,311	) 	 	 	(213,491	) 	
	  	 	 	 	 	 	 	 	
Net financial debt with third parties	  	 	648,861	  	 	 	653,583	  	
 
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4.3 Estimating fair value
The table below shows an analysis of the financial instruments measured at fair value, classified according to the valuation method used. The Atento Group has defined the following valuation levels:
Prices (unadjusted) quoted in active markets for identical assets and liabilities (Level 1).
Data other than the Level 1 quoted price that are observable for the asset or liability, either directly (i.e., prices) or indirectly (i.e., price derivatives) (Level 2).
Data for the asset or liability that are not based on observable market data (Level 3).
The Atento Group’s assets and liabilities measured at fair value at December 31, 2012 and 2013 are as follows:

2012	  	Level 1	 	  	Level 2	 	  	Level 3	 	 	Total balance	 	
Assets	  				  				  				 				
Derivatives	  	 	—	  	  	 	—	  	  	 	—	  	 	 	—	  	
	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	
Total assets	  	 	—	  	  	 	—	  	  	 	—	  	 	 	—	  	
	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	
Liabilities	  				  				  				 				
Derivatives	  	 	—	  	  	 	—	  	  	 	—	  	 	 	—	  	
CVIs	  	 	—	  	  	 	—	  	  	 	(52,275	) 	 	 	(52,275	) 	
	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	
Total liabilities	  	 	—	  	  	 	—	  	  	 	(52,275	) 	 	 	(52,275	) 	

																	
2013	  	Level 1	 	  	Level 2	 	 	Level 3	 	 	Total balance	 	
Assets	  				  				 				 				
Derivatives	  	 	—	  	  	 	18,296	  	 	 	—	  	 	 	18,296	  	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
Total assets	  	 	—	  	  	 	18,296	  	 	 	—	  	 	 	18,296	  	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
Liabilities	  				  				 				 				
Derivatives	  	 	—	  	  	 	(15,962	) 	 	 	—	  	 	 	(15,962	) 	
CVIs	  	 	—	  	  	 	—	  	 	 	(43,367	) 	 	 	(43,367	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
Total liabilities	  	 	—	  	  	 	(15,962	) 	 	 	(43,367	) 	 	 	(59,329	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
No transfers were carried out between the different levels during the year.
The following table reflects the movements of the Atento Group’s Contingent Value Instruments (“CVIs”) described in note 17 measured at fair value using significant unobservable inputs at December 31, 2013 and 2012:

 	  	December 31	 	
 	  	2012	 	 	2013	 	
Fair value at the beginning of the period	  	 	(51,451	) 	 	 	(52,275	) 	
Change in fair value	  	 	—	  	 	 	(5,630	) 	
Translation differences	  	 	(824	) 	 	 	14,538	  	
	  	 	 	 	 	 	 	 	
Fair value at December 31	  	 	(52,275	) 	 	 	(43,367	) 	
	  	 	 	 	 	 	 	 	
a) Level 1 financial instruments:
The fair value of financial instruments traded on active markets is based on the quoted market price at the reporting date. A market is considered active when trading prices are easily and regularly available through a
 
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stock exchange, financial intermediaries, industry institution, price service or regulatory body, and when these prices reflect actual routine arm’s-length market transactions. The quoted market price used for the Atento Group’s financial assets is the current bid price. These instruments are classified in Level 1, although at the dates in question, the Atento Group had no Level 1 financial instruments.
b) Level 2 financial instruments:
The fair value of financial instruments not traded in an active market (i.e., OTC derivatives) is determined using valuation techniques. Valuation techniques maximize the use of available observable market data, and place as little reliance as possible on specific company estimates. If all significant inputs required to calculate the fair value of a financial instrument are observable, the instrument is classified in Level 2. The Atento Group’s Level 2 financial instruments comprise interest rate swaps used to hedge floating-rate loans and cross currency swaps.
c) Level 3 financial instruments:
If one or more significant inputs are not based on observable market data, the instrument is classified in Level 3.
The specific financial instrument valuation techniques used by the Atento Group include the following:
 
 	•	 	Quoted market prices or prices established by financial intermediaries for similar instruments.	
 
 	•	 	The fair value of interest rate swaps is calculated as the present value of the future estimated cash flows based on estimated interest rate curves.	
 
 	•	 	The present value of foreign currency futures is determined using forward exchange rates at the reporting date, discounting the resulting amount from the present value.	
 
 	•	 	Discounted cash flow analyses are used to analyze the fair value of the Contingent-Value Instruments (“CVI”) discussed in note 17. The fair value of the CVIs are based upon discounted cash flow analyses for which the determination of fair value requires significant management judgment or estimation and result in a higher degree of financial statement volatility. As observable market activity is commonly not available to use when estimating the fair value of the CVIs, we estimate fair value using a modeling technique which include the use of a variety of inputs/assumptions including interest rates or other relevant inputs. Changes in the significant underlying factors or assumptions (either an increase or a decrease) in any of these areas underlying our estimates may not result in a significant increase/decrease in the fair value measurement of the CVIs. For example, an increase of 100 basis point in the discount rate would not result in a significant decrease of the fair value of the CVIs.	
5) BUSINESS COMBINATIONS
As stated in Note 1, in 2012 Bain Capital entered into an agreement with Telefónica, S.A. through Atento Luxco 1, S.A. and certain subsidiaries, to acquire the capital of the core companies forming the Atento Group, the parent of which was AIT, owned by the Telefónica Group and not transferred. These companies are located in Spain, Brazil, Mexico, Argentina, Colombia, Peru, Chile, Morocco, the Netherlands, the Czech Republic, Uruguay, Central America, the United States and Puerto Rico. The agreement did not extend to AIT’s operations in Venezuela or to shares in AIT itself, although certain AIT specific assets and liabilities did fall under the acquisition.
After obtaining the requisite business concentration approvals from European Union authorities in October and November 2012, the formal agreement was signed on December 12, 2012 for a total acquisition price of 1,352,967 thousand U.S. dollars. According to the final contract, Bain Capital and Telefónica, S.A. undertook to establish a price adjustment mechanism based on the combined financial statements at November 2012. The parties agreed to a period of 45 business days following the closing date for those statements, as well as an additional 40 business days for the related audit.
 
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The final amount of the consideration to be given to the former owner of the Atento Group was determined during August 2013 and set at 993,789 thousand U.S. dollars for the equity of Atento after deducting the value of the debt to be refinance and other adjustments, including a deferred consideration of 142,846 thousand U.S. dollars and a contingent consideration of 51,451 thousand U.S. dollars (CVIs).
The costs relating to the acquisition were recognized under other operating expenses on the consolidated income statement for the one month period ended December 31, 2012 and the year ended December 31, 2013 (62,395 thousands U.S. dollars and 1,381 thousands U.S. dollars respectively).
Although the acquisition documents were formally signed on December 12, 2012, control of the subject companies was actually acquired on December 1, 2012. Accordingly, the Company reflected the operations acquired in its 2012 income statement of that date.
The table below sets out the fair values of the assets acquired and the liabilities undertaken, as well as the consideration transferred:

Fair value recognized in the acquisition at December 1, 2012	 	
  	  	Thousands of
U.S. dollars	 	
Assets	  				
Intangible assets	  	 	466,257	  	
Property, plant and equipment	  	 	207,458	  	
Non-current financial assets	  	 	56,367	  	
Current receivables	  	 	612,464	  	
Deferred tax assets	  	 	189,209	  	
	  	 	 	 	
	  	 	1,531,755	  	
	  	 	 	 	
Liabilities	  				
Payables	  	 	(504,815	) 	
Provisions	  	 	(125,412	) 	
Deferred tax liabilities	  	 	(135,064	) 	
	  	 	 	 	
	  	 	(765,291	) 	
	  	 	 	 	
Total net identifiable assets at fair value	  	 	766,464	  	
	  	 	 	 	
Goodwill arising on the acquisition (Note 7)	  	 	227,325	  	
	  	 	 	 	
Consideration transferred (2012)	  	 	786,497	  	
	  	 	 	 	
Consideration transferred (2013)	  	 	12,995	  	
	  	 	 	 	
Consideration pending payment	  	 	194,297	  	
	  	 	 	 	
CVIs (Note 17)	  	 	51,451	  	
Vendor Loan Note (Note 17)	  	 	142,846	  	
The main assets acquired and liabilities undertaken at fair value were as follows:
 
 	•	 	Master Service Agreement with Telefónica S.A. of October 11, 2012 for certain countries, including Brazil, Mexico, Spain, Peru, Chile, Colombia and Argentina. This contract was arranged in order to strengthen the commercial ties between the Atento Group and Telefónica, and to enable the Atento Group to avoid the cost of establishing new centers, from a market standpoint. This intangible asset was valued using the income approach, through the Multi-period Excess Earnings Method (MEEM), at 225,360 thousand U.S. dollars. The useful life of this intangible asset has been estimated at nine years.	
 
 	•	 	Contractual relationships with customers other than Telefónica in the countries in which the Atento Group operates, primarily Brazil, Mexico, Spain, Colombia and Argentina. This intangible asset was	
 
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 	valued using the income approach, through the Multi-period Excess Earnings Method (MEEM), at 157,964 thousand U.S. dollars. The useful life has been estimated between seven and twelve years.	
 
 	•	 	Following acquisition of control of the Atento Group by Bain Capital, new measurement tools were developed for labor contingency provisions in the different countries in which the Group operates. According to IFRS 3 “Business Combinations”, at the date the control was acquired, the Atento Group estimated the contingent liabilities. As a result, the Atento Group has determined the need to increase provisions by 72,415 thousand U.S. dollars. The increase in these provisions has also entailed a 23,684 thousand U.S. dollars increase in deferred tax assets.	
 
 	•	 	The Atento Group recognized deferred tax assets for a fair value of 99,645 thousand U.S. dollars in respect of tax deductions for goodwill arising on the merger of two companies in the Brazilian subgroup.	
In addition, deferred tax liabilities totaling 33,075 thousand U.S. dollars were derecognized, given that the tax benefits associated with the goodwill rising on a previous merger between Group companies had already been obtained.
 
 	•	 	The Atento Group recognized an additional 128,173 thousand U.S. dollars (fair value) in deferred tax liabilities, primarily related with changes in the fair value of assets in the customer base.	
Goodwill recognized in the amount of 227,325 thousand U.S. dollars chiefly relates to synergies expected from the acquisition. A breakdown of goodwill is provided in Note 7.
Atento Group Management (post-acquisition) had a managing period of one month in 2012 (as previously mentioned, Atento Group was acquired on December 1, 2012), so Management considers that performing an estimate for the whole year is subject to many uncertainties, and is therefore no such estimate is included in the consolidated financial statements.
6) INTANGIBLE ASSETS
Details of intangible assets at December 31, 2012 and 2013 and movement therein are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	Balance at
December 1,
2012	 	  	Additions	 	 	Disposals	 	 	Transfers	 	  	Translation
differences	 	 	Balance at
December 31,
2012	 	
Cost	  				  				 				 				  				 				
Development	  	 	—	  	  	 	—	  	 	 	—	  	 	 	—	  	  	 	—	  	 	 	—	  	
Customer base	  	 	383,325	  	  	 	—	  	 	 	—	  	 	 	—	  	  	 	6,772	  	 	 	390,097	  	
Software	  	 	31,305	  	  	 	6,070	  	 	 	(156	) 	 	 	41	  	  	 	(410	) 	 	 	36,850	  	
Other intangible assets	  	 	51,528	  	  	 	236	  	 	 	—	  	 	 	—	  	  	 	661	  	 	 	52,425	  	
Work in progress	  	 	99	  	  	 	791	  	 	 	—	  	 	 	—	  	  	 	(2	) 	 	 	888	  	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total cost	  	 	466,257	  	  	 	7,097	  	 	 	(156	) 	 	 	41	  	  	 	7,021	  	 	 	480,260	  	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Accumulated amortization	  				  				 				 				  				 				
Development	  	 	—	  	  	 	—	  	 	 	—	  	 	 	—	  	  	 	—	  	 	 	—	  	
Customer base	  	 	—	  	  	 	(13	) 	 	 	—	  	 	 	—	  	  	 	—	  	 	 	(13	) 	
Software	  	 	—	  	  	 	(1,188	) 	 	 	—	  	 	 	—	  	  	 	(223	) 	 	 	(1,411	) 	
Other intangible assets	  	 	—	  	  	 	(1,227	) 	 	 	—	  	 	 	—	  	  	 	209	  	 	 	(1,018	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total accumulated amortization	  	 	—	  	  	 	(2,428	) 	 	 	—	  	 	 	—	  	  	 	(14	) 	 	 	(2,442	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Net intangible assets	  	 	466,257	  	  	 	4,669	  	 	 	(156	) 	 	 	41	  	  	 	7,007	  	 	 	477,818	  	

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 	  	Thousands of U.S. dollars	 	
 	  	Balance at
December 31,
2012	 	 	Additions	 	 	Disposals	 	 	Transfers	 	  	Translation
differences	 	 	Balance at
December 31,
2013	 	
Cost	  				 				 				 				  				 				
Development	  	 	—	  	 	 	1,671	  	 	 	(95	) 	 	 	—	  	  	 	(133	) 	 	 	1,443	  	
Customer base	  	 	390,097	  	 	 	—	  	 	 	—	  	 	 	—	  	  	 	(26,380	) 	 	 	363,717	  	
Software	  	 	36,850	  	 	 	11,283	  	 	 	(4	) 	 	 	—	  	  	 	(1,112	) 	 	 	47,017	  	
Other intangible assets	  	 	52,425	  	 	 	—	  	 	 	—	  	 	 	—	  	  	 	(1,143	) 	 	 	51,282	  	
Work in progress	  	 	888	  	 	 	981	  	 	 	(754	) 	 	 	—	  	  	 	35	  	 	 	1,150	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total cost	  	 	480,260	  	 	 	13,935	  	 	 	(853	) 	 	 	—	  	  	 	(28,733	) 	 	 	464,609	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Accumulated amortization	  				 				 				 				  				 				
Development	  	 	—	  	 	 	(5	) 	 	 	—	  	 	 	—	  	  	 	—	  	 	 	(5	) 	
Customer base	  	 	(13	) 	 	 	(40,668	) 	 	 	13	  	 	 	—	  	  	 	1,706	  	 	 	(38,962	) 	
Software	  	 	(1,411	) 	 	 	(16,074	) 	 	 	64	  	 	 	—	  	  	 	213	  	 	 	(17,208	) 	
Other intangible assets	  	 	(1,018	) 	 	 	(13,933	) 	 	 	—	  	 	 	—	  	  	 	(706	) 	 	 	(15,657	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total accumulated amortization	  	 	(2,442	) 	 	 	(70,680	) 	 	 	77	  	 	 	—	  	  	 	1,213	  	 	 	(71,832	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Net intangible assets	  	 	477,818	  	 	 	(56,745	) 	 	 	(776	) 	 	 	—	  	  	 	(27,520	) 	 	 	392,777	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
“Customer base” represents the fair value, within the business combination involving the acquisition of control of the Atento Group, of the intangible asset arising from service agreements (tacit or explicitly formulated in contracts) with Telefónica Group and with other customers.
Of the total customer base, the fair value assigned to commercial relationships with Telefónica in the acquisition date amounts to 225 million U.S. dollars, while the remaining amount relates to other customers. In terms of geographic distribution, the customer base primarily corresponds to businesses in Brazil (175 million U.S. dollars), Spain (84 million U.S. dollars), Mexico (61 million U.S. dollars), Peru (21 million U.S. dollars), Colombia (5 million U.S. dollars), Chile (13 million U.S. dollars) and Argentina (13 million U.S. dollars).
“Other intangible assets” includes the intangible asset arising from the 11822 and 11825 directory services business, the “Atento” brand, and the domain names related therewith, as well as the intangible asset related with the customer analysis service for several Telefónica Group companies in Latin America.
Development costs capitalized in 2013 were chiefly accounted for by in-house software development. No research and development expenses were recognized in the 2013 income statement.
No impairment was recognized in respect of intangible assets in 2012 or 2013.
7) GOODWILL
Goodwill was generated in December 1, 2012 as a result of the acquisition of the CRM business from Telefónica, S.A. described in Note 1.
 
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The breakdown, amount and movement of goodwill by cash generating units in 2012 and 2013 are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	12/01/2012
(Note 6)	 	  	Translation
differences	 	 	12/31/2012	 	  	Translation
differences	 	 	12/31/2013	 	
Peru	  	 	37,866	  	  	 	(399	) 	 	 	37,467	  	  	 	(3,282	) 	 	 	34,185	  	
Chile	  	 	23,925	  	  	 	22	  	 	 	23,947	  	  	 	(2,037	) 	 	 	21,910	  	
Colombia	  	 	10,286	  	  	 	265	  	 	 	10,551	  	  	 	(870	) 	 	 	9,681	  	
Czech Republic	  	 	3,882	  	  	 	80	  	 	 	3,962	  	  	 	(165	) 	 	 	3,797	  	
Mexico	  	 	2,850	  	  	 	(8	) 	 	 	2,842	  	  	 	(26	) 	 	 	2,816	  	
Spain	  	 	1,093	  	  	 	18	  	 	 	1,111	  	  	 	50	  	 	 	1,161	  	
Brazil	  	 	86,617	  	  	 	2,708	  	 	 	89,325	  	  	 	(11,405	) 	 	 	77,920	  	
Argentina	  	 	60,806	  	  	 	542	  	 	 	61,348	  	  	 	(15,079	) 	 	 	46,269	  	
	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Total	  	 	227,325	  	  	 	3,228	  	 	 	230,553	  	  	 	(32,814	) 	 	 	197,739	  	
	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	
Details of goodwill in local currency are as follows (in thousands of currency units):

Peru	  	 	Nuevo Sol	  	  	 	97,714	  	
Chile	  	 	Peso	  	  	 	11,493,730	  	
Colombia	  	 	Peso	  	  	 	18,654,963	  	
Czech Republic	  	 	Koruna	  	  	 	75,503	  	
Mexico	  	 	Peso	  	  	 	36,847	  	
Spain	  	 	Euro	  	  	 	842	  	
Brazil	  	 	Real	  	  	 	182,536	  	
Argentina	  	 	Peso	  	  	 	294,178	  	
As indicated in Note 8, no impairment was recognized in 2012 or 2013.
8) IMPAIRMENT OF ASSETS
With respect to IAS 36, at December 31, 2013 the judgments and estimates used by the Atento Group’s directors to calculate the recoverable amount of goodwill indicate that the carrying amount of each item of goodwill is recoverable, based on the expected future cash flows from the cash-generating units to which they are allocated. The level of analysis performed by the Atento Group at the cash-generating unit level coincides with that performed at country level.
Atento has no assets with an indefinite useful life and therefore carries out no impairment tests of this type.
The Atento Group carries out its goodwill impairment tests using the various cash-generating units’ five-year strategic plans and budgets, approved by the Management.
Cash flows are estimated using projected results before amortization/depreciation, finance cost, and taxes, based on the last period, and using expected growth rates obtained from studies published in the sector and assuming said growth to be constant from the fifth year. Estimated cash flows determined in this manner are discounted using average Weighted Average Cost of Capital (“WACC”). The discount rates used reflect the current assessment of specific market risks in each of the cash-generating units, considering the time value of money and individual risks of each country not included in the cash flow estimates. WACC takes both the cost of debt and capital into account. The latter is obtained based on the profit expected by shareholders of the Atento Group, while the former is obtained based on the Atento Group’s financing costs. In addition, the risks specific to each country were included in the WACC using corrective factors.
 
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These tests are performed annually and whenever it is considered that the recoverable amount of goodwill may be impaired.
The pre-tax discount rates, which factor in country and business risks, and the projected growth rates are as follows:

  	  	Discount rate	 	
 	  	Brazil	 	 	Mexico	 	 	Spain	 	 	Colombia	 	 	Peru	 	 	Chile	 	 	Czech
Republic	 	 	Argentina	 	
December 2012	  	 	13.18	% 	 	 	12.19	% 	 	 	12.00	% 	 	 	11.55	% 	 	 	10.29	% 	 	 	11.28	% 	 	 	9.01	% 	 	 	28.51	% 	
December 2013	  	 	16.53	% 	 	 	12.21	% 	 	 	10.38	% 	 	 	12.50	% 	 	 	11.37	% 	 	 	11.27	% 	 	 	9.52	% 	 	 	31.77	% 	
		
 	  	Growth rate	 	
 	  	Brazil	 	 	Mexico	 	 	Spain	 	 	Colombia	 	 	Peru	 	 	Chile	 	 	Czech
Republic	 	 	Argentina	 	
December 2012	  	 	2	% 	 	 	2	% 	 	 	2	% 	 	 	2	% 	 	 	2	% 	 	 	2	% 	 	 	2	% 	 	 	2	% 	
December 2013	  	 	5.50	% 	 	 	3.10	% 	 	 	1.85	% 	 	 	3.00	% 	 	 	2.50	% 	 	 	3.00	% 	 	 	2.03	% 	 	 	16.83	% 	
At December 31, 2012 and 2013, the tests conducted did not reveal any impairment in the value of goodwill, since the related cash flows were in all cases higher than the carrying amount of the related cash-generating units, even after sensitivities were applied to the variables used.
In the event of a 10% increase in the discount rate used to calculate the recoverable amount of the cash-generating units in each country and the other variables remained unchanged, the recoverable amount would be higher than the corresponding carrying amount. Management also considers that the appearance of potential competitors in the market in which the Atento Group operates could negatively affect the growth of its cash-generating units. In the event of a 10% decrease in the growth rate used to calculate the recoverable amount of the cash-generating units in each country and all other variables remained unchanged, the recoverable amount would also be higher than the corresponding carrying amount. In addition, if as a result of a fall in demand or an increase in costs, results before amortization/depreciation, finance cost and taxes margin (EBITDA margin) used for estimating cash flows were to decrease by 1% in each country, and all other variables were to remain unchanged, the recoverable amount from each cash-generating unit would continue to be higher than its corresponding carrying amount.
In addition to the above, specifically for certain countries, the following hypotheses were used:
For the Argentina CGU, the cash flow growth rate used was based on the country’s estimated inflation; to calculate terminal value, a normalized conservative growth rate was assumed, taking into account a long-term stabilization of macroeconomic variables. Cash flow for the Brazil and Mexico CGUs were estimated based on growth estimates considering past business performance, using predicted inflation levels taken from external sources. For calculations regarding the Spanish CGU, negative and positive business forecasts were used which contemplate macroeconomic trends and changes in the environment.
As a result of amendments to IFRS 13, IAS 36 was modified to require disclosures on the recoverable amount of cash-generating units with significant carrying amounts in comparison with the entity’s total carrying amount of goodwill. However, in May 2013 IAS 36 was amended in order to eliminate this disclosure requirement. Recoverable amount disclosures will still be required for cash-generating units that have presented impairment losses during the year. The amendment is effective for periods beginning on or after January 1, 2014, although early adoption is allowed. The Atento Group has adopted the amendment in advance of the effective date.
 
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9) PROPERTY, PLANT AND EQUIPMENT
Details of property, plant and equipment at December 31, 2012 and 2013 and movement therein are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	Balance at
December 1,
2012	 	  	Additions	 	 	Disposals	 	 	Transfers	 	 	Translation
differences	 	 	Balance at
December 31,
2012	 	
Cost	  				  				 				 				 				 				
Land and natural resources	  	 	43	  	  	 	—	  	 	 	—	  	 	 	—	  	 	 	1	  	 	 	44	  	
Buildings	  	 	8,705	  	  	 	—	  	 	 	—	  	 	 	—	  	 	 	138	  	 	 	8,843	  	
Plant and machinery	  	 	6,736	  	  	 	513	  	 	 	(261	) 	 	 	—	  	 	 	72	  	 	 	7,060	  	
Furniture, tools and other tangible assets	  	 	178,537	  	  	 	20,761	  	 	 	(388	) 	 	 	5,438	  	 	 	350	  	 	 	204,698	  	
PP&E under construction	  	 	13,437	  	  				 	 	—	  	 	 	(5,438	) 	 	 	262	  	 	 	8,261	  	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total property, plant and equipment	  	 	207,458	  	  	 	21,274	  	 	 	(649	) 	 	 	—	  	 	 	823	  	 	 	228,906	  	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Accumulated depreciation	  				  				 				 				 				 				
Buildings	  	 	—	  	  	 	(196	) 	 	 	49	  	 	 	—	  	 	 	(2	) 	 	 	(149	) 	
Plant and machinery	  	 	—	  	  	 	(239	) 	 	 	1	  	 	 	—	  	 	 	(12	) 	 	 	(250	) 	
Furniture, tools and other tangible assets	  	 	—	  	  	 	(4,637	) 	 	 	—	  	 	 	—	  	 	 	592	  	 	 	(4,045	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total accumulated depreciation	  	 	—	  	  	 	(5,072	) 	 	 	50	  	 	 	—	  	 	 	578	  	 	 	(4,444	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net property, plant and equipment	  	 	207,458	  	  	 	16,202	  	 	 	(599	) 	 	 	—	  	 	 	1,401	  	 	 	224,462	  	

																									
 	  	Thousands of US dollars	 	
 	  	Balance at
December 31,
2012	 	 	Additions	 	 	Disposals	 	 	Transfers	 	 	Translation
differences	 	 	Balance at
December 31,
2013	 	
Cost	  				 				 				 				 				 				
Land and natural resources	  	 	44	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	2	  	 	 	46	  	
Buildings	  	 	8,843	  	 	 	93	  	 	 	(121	) 	 	 	1,378	  	 	 	557	  	 	 	10,750	  	
Plant and machinery	  	 	7,060	  	 	 	1,150	  	 				 	 	581	  	 	 	(380	) 	 	 	8,411	  	
Furniture, tools and other tangible assets	  	 	204,698	  	 	 	68,505	  	 	 	(22,168	) 	 	 	4,685	  	 	 	(16,509	) 	 	 	239,211	  	
PP&E under construction	  	 	8,261	  	 	 	19,346	  	 	 	—	  	 	 	(6,644	) 	 	 	(1,922	) 	 	 	19,041	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total property, plant and equipment	  	 	228,906	  	 	 	89,094	  	 	 	(22,289	) 	 	 	—	  	 	 	(18,252	) 	 	 	277,459	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Accumulated depreciation	  				 				 				 				 				 				
Buildings	  	 	(149	) 	 	 	(1,921	) 	 	 	—	  	 	 	—	  	 	 	(77	) 	 	 	(2,147	) 	
Plant and machinery	  	 	(250	) 	 	 	(2,623	) 	 	 	—	  	 	 	—	  	 	 	(24	) 	 	 	(2,897	) 	
Furniture, tools and other tangible assets	  	 	(4,045	) 	 	 	(53,751	) 	 	 	17,168	  	 	 	—	  	 	 	(184	) 	 	 	(40,812	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total accumulated depreciation	  	 	(4,444	) 	 	 	(58,295	) 	 	 	17,168	  	 	 	—	  	 	 	(285	) 	 	 	(45,856	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net property, plant and equipment	  	 	224,462	  	 	 	30,799	  	 	 	(5,121	) 	 	 	—	  	 	 	(18,537	) 	 	 	231,603	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Additions for the year correspond primarily to investments made in Brazil in response to growth of the business and to the upgrade of existing infrastructure (58,432 thousand U.S. dollars); to construction of a new call center and to the upgrade of infrastructure in place in Mexico (10,256 thousand U.S. dollars); to equipment
 
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acquired under finance leases in Colombia and to the upgrade of infrastructure in that country (6,480 thousand U.S. dollars); to new equipment under finance leases and to the upgrade of current infrastructure in Peru (4,562 thousand U.S. dollars); and to the upgrade of infrastructure in Spain (3,950 thousand U.S. dollars).
“Furniture, tools and other tangible assets” primarily comprises net items of that description in Spain, Mexico and Brazil (in the amount of 16,335 thousand U.S. dollars, 22,303 thousand U.S. dollars and 119,298 thousand U.S. dollars, respectively (19,166 thousand U.S. dollars, 19,473 thousand U.S. dollars and 126,227 thousand U.S. dollars, respectively in 2012) in connection with furnishings and fixtures in customer service centers in those countries.
Property, plant and equipment located outside Spain total 208,226 thousand U.S. dollars (197,131 thousand U.S. dollars at December 31, 2012) and are primarily on site in Mexico and Brazil (24,934 thousand U.S. dollars and 137,161 thousand U.S. dollars, respectively at December 31, 2013; 23,633 thousand U.S. dollars and 130,069 thousand U.S. dollars, respectively at December 31, 2012).
All Atento Group companies have contracted insurance policies to cover potential risks to their items of property, plant and equipment. The directors of the Parent Company considered that coverage of these risks is sufficient at December 31, 2012 and 2013.
No impairment was recognized in respect of items of property, plant and equipment in 2012 or 2013.
No interest expense was capitalized in 2012 or 2013 in respect of these assets.
At December 31, 2012 and 2013 there were no firm commitments to acquire items of property, plant and equipment.
10) LEASES AND SIMILAR ARRANGEMENTS
a) Finance leases
The Atento Group holds the following assets under finance leases:

 	  	Thousands of U.S. dollars	 	
 	  	12/31/2012	 	  	12/31/2013	 	
 	  	Net carrying
amount of asset	 	  	Net carrying
amount of asset	 	
Finance leases	  				  				
Plant and machinery	  	 	454	  	  	 	—	  	
Furniture, tools and other tangible assets	  	 	8,786	  	  	 	9,392	  	
Software	  	 	1,292	  	  	 	38	  	
Other intangible assets	  	 	3,549	  	  	 	—	  	
	  	 	 	 	  	 	 	 	
Total	  	 	14,081	  	  	 	9,430	  	
	  	 	 	 	  	 	 	 	
The assets acquired under finance leases are located in Brazil, Uruguay, Colombia and Peru.
The present value of future finance lease payments is as follows:

 	  	Thousands of U.S. dollars	 	
 	  	    2012    	 	  	    2013    	 	
Up to 1 year	  	 	3,483	  	  	 	5,341	  	
Between 1 and 5 years	  	 	5,213	  	  	 	6,536	  	
	  	 	 	 	  	 	 	 	
Total	  	 	8,696	  	  	 	11,877	  	

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11) FINANCIAL ASSETS
Details of financial assets at December 31, 2012 and 2013 are as follows:

 	  	Thousands of U.S. dollars	 	
2012	  	Loans and
receivables	 	  	Derivatives	 	  	Total	 	
Trade and other receivables (Note 13)	  	 	7,482	  	  	 	—	  	  	 	7,482	  	
Other financial assets (Note 12)	  	 	51,066	  	  	 	—	  	  	 	51,066	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Non-current financial assets	  	 	58,548	  	  	 	—	  	  	 	58,548	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Trade and other receivables (Note 13)	  	 	516,787	  	  	 	—	  	  	 	516,787	  	
Other financial assets (Note 12)	  	 	31,108	  	  	 	—	  	  	 	31,108	  	
Cash and cash equivalents (Note 15)	  	 	200,311	  	  	 	—	  	  	 	200,311	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Current financial assets	  	 	748,206	  	  	 	—	  	  	 	748,206	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
TOTAL FINANCIAL ASSETS	  	 	806,754	  	  	 	—	  	  	 	806,754	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Excluding advance payments and non-financial assets.

 	  	Thousands of U.S. dollars	 	
2013	  	Loans and
receivables	 	  	Derivatives	 	  	Total	 	
Trade and other receivables (Note 13)	  	 	72	  	  	 	—	  	  	 	72	  	
Other financial assets (Note 12)	  	 	53,812	  	  	 	—	  	  	 	53,812	  	
Financial derivative instruments (Note 14)	  	 	—	  	  	 	15,439	  	  	 	15,439	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Non-current financial assets	  	 	53,884	  	  	 	15,439	  	  	 	69,323	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Trade and other receivables (Note 13)	  	 	516,960	  	  	 	—	  	  	 	516,960	  	
Other financial assets (Note 12)	  	 	1,425	  	  	 	—	  	  	 	1,425	  	
Financial derivative instruments (Note 14)	  	 	—	  	  	 	2,857	  	  	 	2,857	  	
Cash and cash equivalents (Note 15)	  	 	213,491	  	  	 	—	  	  	 	213,491	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Current financial assets	  	 	731,876	  	  	 	2,857	  	  	 	734,733	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
TOTAL FINANCIAL ASSETS	  	 	785,760	  	  	 	18,296	  	  	 	804,056	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Excluding advance payments and non-financial assets.
Credit risk arises from the possibility that the Atento Group might not recover its financial assets at the amount recognized and in the established term. Atento Group Management considers that the carrying amount of financial assets is similar to the fair value.
12) OTHER FINANCIAL ASSETS
Details of other financial assets at December 31, 2012 and 2013 are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	12/31/2012	 	  	12/31/2013	 	
Other non-current receivables	  	 	8	  	  	 	2,428	  	
Non-current guarantees and deposits	  	 	51,058	  	  	 	51,384	  	
	  	 	 	 	  	 	 	 	
Total non-current	  	 	51,066	  	  	 	53,812	  	
Other current receivables	  	 	28,723	  	  	 	—	  	
Current guarantees and deposits	  	 	2,332	  	  	 	1,425	  	
Other current financial assets	  	 	53	  	  	 	—	  	
	  	 	 	 	  	 	 	 	
Total current	  	 	31,108	  	  	 	1,425	  	
	  	 	 	 	  	 	 	 	
Total	  	 	82,174	  	  	 	55,237	  	

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“Guarantees and deposits” at December 31, 2012 and 2013 primarily comprise deposits posted with the courts in respect of legal disputes with employees of the subsidiary Atento Brasil, S.A. and for litigation underway with the Brazilian social security authority (Instituto Nacional do Seguro Social).
At December 31, 2012, “Other current receivables” of 28,723 thousand U.S. dollars primarily related to short-term deposits at Brazilian financial institutions pegged to the CDI.
13) TRADE AND OTHER RECEIVABLES
Details of trade and other receivables are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	12/31/2012	 	  	12/31/2013	 	
Non-current trade receivables	  	 	7,482	  	  	 	72	  	
	  	 	 	 	  	 	 	 	
Total non-current	  	 	7,482	  	  	 	72	  	
Current trade receivables	  	 	492,214	  	  	 	492,900	  	
Other receivables	  	 	15,008	  	  	 	12,540	  	
Prepayments	  	 	3,429	  	  	 	4,326	  	
Personnel	  	 	9,565	  	  	 	11,520	  	
	  	 	 	 	  	 	 	 	
Total current	  	 	520,216	  	  	 	521,286	  	
	  	 	 	 	  	 	 	 	
Total	  	 	527,698	  	  	 	521,358	  	
	  	 	 	 	  	 	 	 	
The balance of trade receivables is shown net of impairment allowances.

 	  	Thousands of U.S. dollars	 	
 	  	12/31/2012	 	 	12/31/2013	 	
Trade receivables	  	 	516,966	  	 	 	502,986	  	
Impairment allowances	  	 	(17,270	) 	 	 	(10,014	) 	
	  	 	 	 	 	 	 	 	
Trade receivables, net	  	 	499,696	  	 	 	492,972	  	
	  	 	 	 	 	 	 	 	
At December 31, 2013 trade receivables not yet due for which no provision has been made amounted to 422,086 thousand U.S. dollars (438,389 thousand U.S. dollars at December 31, 2012).
At December 31, 2013 trade receivables due for which no provision has been made amounted to 70,886 thousand U.S. dollars (61,307 thousand U.S. dollars at December 31, 2012). These balances correspond to certain independent customers with no recent history of default. The age analysis of these accounts is as follows:

 	  	Thousands of U.S. dollars	 	
 	  	Less than
90 days	 	  	Between 90
and 180 days	 	  	Between 180
and 360 days	 	  	Over 360 days	 	  	Total	 	
12/31/2012	  	 	49,101	  	  	 	3,735	  	  	 	5,906	  	  	 	2,565	  	  	 	61,307	  	
12/31/2013	  	 	54,154	  	  	 	3,699	  	  	 	2,135	  	  	 	10,898	  	  	 	70,886	  	
Movement in the provision for impairment of trade receivables in 2013 was as follows:

 	  	Thousands of U.S. dollars	 	
Opening balance	  	 	(17,270	) 	
Allowance	  	 	(3,496	) 	
Reversal	  	 	5,522	  	
Application	  	 	4,212	  	
Translation differences	  	 	1,018	  	
	  	 	 	 	
Closing balance	  	 	(10,014	) 	

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During the one-month period ended December 31, 2012 “Impairment allowances” totaling 2,792 thousand U.S. dollars were recognized.
The Atento Group’s maximum exposure to credit risk at the reporting date is the carrying amount of each of the aforementioned trade receivables categories. The Atento Group holds no guarantees as collection insurance.
14) DERIVATIVE FINANCIAL INSTRUMENTS
Details of derivative financial instruments at December 31, 2012 and 2013 are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	12/31/2012	 	  	12/31/2013	 	
 	  	Assets	 	  	Assets	 	  	Assets	 	  	Liabilities	 	
Interest rate swaps—cash flow hedges	  	 	—	  	  	 	—	  	  	 	15,611	  	  	 	—	  	
Cross-currency swaps—cash flow hedge	  	 	—	  	  	 	—	  	  	 	—	  	  	 	(10,985	) 	
Cross-currency swaps—that do not meet the criteria for hedge accounting	  	 	—	  	  	 	—	  	  	 	2,685	  	  	 	(4,977	) 	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	—	  	  	 	—	  	  	 	18,296	  	  	 	(15,962	)  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Non-current portion	  	 	—	  	  	 	—	  	  	 	15,439	  	  	 	(15,962	) 	
Current portion	  	 	—	  	  	 	—	  	  	 	2,857	  	  	 	—	  	
Derivatives held for trading are classified as a current asset or a current liability. The fair value of a hedging derivative is classified as a non-current asset or a non-current liability, as applicable, if the remaining maturity of the hedged item exceeds twelve months; otherwise, it is classified as a current asset or liability.
The Atento Group has contracted interest rate swaps to hedge fluctuations in interest rates in respect of debentures issued in Brazil (see Note 17).
At December 31, 2013, the notional principal of the interest rate swaps amounts to 595 million Brazilian reais (equivalent to 254 million U.S. dollars).
During the year ended December 31, 2013 the average fixed interest rate was 11.72%. Floating interest rates are pegged to the CDI plus 3.70%.
The Atento Group has arranged cross-currency swap instruments to cover U.S. dollar payments arising from the senior secured notes issued in 2013 (see Note 17).
At December 31, 2013 details of cross-currency swaps that are designated and qualified as cash flow hedge were as follows:

Bank	 	Date	 	 	Maturity	 	 	Purchase
currency	 	 	Amount
purchased
(thousands)	 	 	Fixed rate
bank
count-party
payment	 	 	Selling
currency	 	 	Amount
sold
(thousands)	 	 	Fixed rate
Atento
payment	 	 	Spot	 	
Santander	 	 	01/29/2013	  	 	 	01/29/2018	  	 	 	USD	  	 	 	738	  	 	 	7.3750	% 	 	 	EUR	  	 	 	560	  	 	 	7.5450	% 	 	 	1,347	  	
Santander	 	 	01/29/2018	  	 	 	01/29/2020	  	 	 	USD	  	 	 	922	  	 	 	7.3750	% 	 	 	EUR	  	 	 	700	  	 	 	7.5450	% 	 	 	1,347	  	
Santander	 	 	01/29/2020	  	 	 	01/29/2020	  	 	 	USD	  	 	 	25,000	  	 	 	7.3750	% 	 	 	EUR	  	 	 	18,560	  	 	 	7.5450	% 	 	 	1,347	  	
Goldman Sachs	 	 	01/29/2013	  	 	 	01/28/2018	  	 	 	USD	  	 	 	48,000	  	 	 	7.3750	% 	 	 	EUR	  	 	 	35,635	  	 	 	7.5475	% 	 	 	1,347	  	
Goldman Sachs	 	 	01/29/2018	  	 	 	01/29/2020	  	 	 	USD	  	 	 	60,000	  	 	 	7.3750	% 	 	 	EUR	  	 	 	44,543	  	 	 	7.5475	% 	 	 	1,347	  	
Nomura	 	 	01/29/2013	  	 	 	01/28/2018	  	 	 	USD	  	 	 	22,000	  	 	 	7.3750	% 	 	 	EUR	  	 	 	16,333	  	 	 	7.6050	% 	 	 	1,347	  	
Nomura	 	 	01/29/2018	  	 	 	01/29/2020	  	 	 	USD	  	 	 	27,500	  	 	 	7.3750	% 	 	 	EUR	  	 	 	20,416	  	 	 	7.6050	% 	 	 	1,347	  	
Gains and losses on interest rate swap hedges recognized in equity will be taken to the income statement up through maturity of the corresponding contracts as disclosed in the table above.
 
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There were no ineffective hedge derivatives in 2013.
The Atento Group also contracted the following cross currency swaps that are not designated and qualified as hedging instruments:

Bank	 	Date	 	 	Maturity	 	 	Purchase
currency	 	 	Amount
purchased
(thousands)	 	 	Fixed rate
bank
count-party
payment	 	 	Selling
currency	 	Amount
sold
(thousands)	 	 	Fixed rate
Atento
payment	 	 	Spot	 	
Santander	 	 	01/29/2013	  	 	 	01/29/2018	  	 	 	USD	  	 	 	410	  	 	 	7.3750	% 	 	MXN	 	 	9,144	  	 	 	12.9500	% 	 	 	12,71	  	
Santander	 	 	01/29/2018	  	 	 	01/29/2020	  	 	 	USD	  	 	 	615	  	 	 	7.3750	% 	 	MXN	 	 	13,716	  	 	 	12.9500	% 	 	 	12,71	  	
Santander	 	 	01/29/2020	  	 	 	01/29/2020	  	 	 	USD	  	 	 	16,667	  	 	 	7.3750	% 	 	MXN	 	 	211,833	  	 	 	12.9500	% 	 	 	12,71	  	
Goldman Sachs	 	 	01/29/2013	  	 	 	01/28/2018	  	 	 	USD	  	 	 	40,000	  	 	 	7.3750	% 	 	MXN	 	 	508,400	  	 	 	12.9120	% 	 	 	12,71	  	
Goldman Sachs	 	 	01/29/2018	  	 	 	01/29/2020	  	 	 	USD	  	 	 	60,000	  	 	 	7.3750	% 	 	MXN	 	 	762,600	  	 	 	12.9120	% 	 	 	12,71	  	
Nomura	 	 	01/29/2013	  	 	 	01/28/2018	  	 	 	USD	  	 	 	23,889	  	 	 	7.3750	% 	 	MXN	 	 	303,628	  	 	 	12.9000	% 	 	 	12,71	  	
Nomura	 	 	01/29/2018	  	 	 	01/29/2020	  	 	 	USD	  	 	 	35,833	  	 	 	7.3750	% 	 	MXN	 	 	455,442	  	 	 	12.9000	% 	 	 	12,71	  	
Goldman Sachs	 	 	01/29/2013	  	 	 	01/29/2018	  	 	 	USD	  	 	 	7,200	  	 	 	7.3750	% 	 	COP	 	 	12,819,600	  	 	 	8.2150	% 	 	 	1780,5	  	
Goldman Sachs	 	 	01/29/2013	  	 	 	01/29/2018	  	 	 	USD	  	 	 	13,800	  	 	 	7.3750	% 	 	PEN	 	 	35,356	  	 	 	7.7900	% 	 	 	2,562	  	
BBVA	 	 	01/29/2013	  	 	 	01/29/2018	  	 	 	USD	  	 	 	28,800	  	 	 	7.3750	% 	 	COP	 	 	51,278,400	  	 	 	8.2160	% 	 	 	1780,5	  	
BBVA	 	 	01/29/2013	  	 	 	01/29/2018	  	 	 	USD	  	 	 	52,200	  	 	 	7.3750	% 	 	PEN	 	 	141,422	  	 	 	7.7800	% 	 	 	2,625	  	
During the year ended December 31,2013, variations in fair value of the derivative financial instruments that are not considered as hedging derivatives recorded under the income statement amount to a net loss of 5,470 thousand U.S. dollars.
15) CASH AND CASH EQUIVALENTS

 	  	Thousands of U.S. dollars	 	
 	  	12/31/2012	 	  	12/31/2013	 	
Cash and cash equivalents at banks	  	 	200,311	  	  	 	168,287	  	
Cash equivalents	  	 	—	  	  	 	45,204	  	
	  	 	 	 	  	 	 	 	
Total	  	 	200,311	  	  	 	213,491	  	
	  	 	 	 	  	 	 	 	
As indicated in Note 25, the current accounts of some Group companies have been pledged in guarantees.
“Cash equivalents” comprises short-term fixed-income securities in Brazil, which mature in less than three months and accrue interest pegged to the CDI.
16) FINANCIAL LIABILITIES
Details of financial liabilities at December 31, 2012 and 2013 are as follows:

 	  	Thousands of U.S. dollars	 	
2012	  	Liabilities at fair
value through
profit and loss	 	  	Derivatives	 	  	Other financial
liabilities at
amortized cost	 	  	Total	 	
Debentures and bonds (Note 17)	  	 	—	  	  	 	—	  	  	 	440,568	  	  	 	440,568	  	
Interest-bearing debt (Note 17)	  	 	—	  	  	 	—	  	  	 	169,865	  	  	 	169,865	  	
Finance lease payables (Note 10)	  	 	—	  	  	 	—	  	  	 	5,213	  	  	 	5,213	  	
CVIs (Note 17)	  	 	52,275	  	  	 	—	  	  	 	—	  	  	 	52,275	  	
Vendor Loan (Note 17)	  	 	—	  	  	 	—	  	  	 	145,134	  	  	 	145,134	  	
Payable to Group companies (Note 26)	  	 	—	  	  	 	—	  	  	 	471,624	  	  	 	471,624	  	
Trade and other payables (Note 18)	  	 	—	  	  	 	—	  	  	 	59	  	  	 	59	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Non-current financial liabilities	  	 	52,275	  	  	 	—	  	  	 	1,232,463	  	  	 	1,284,738	  	

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  	  	Thousands of U.S. dollars	 	
2012	  	Liabilities at fair
value through
profit and loss	 	  	Derivatives	 	  	Other financial
liabilities at
amortized cost	 	  	Total	 	
Debentures and bonds (Note 17)	  	 	—	  	  	 	—	  	  	 	2,387	  	  	 	2,387	  	
Interest-bearing debt (Note 17)	  	 	—	  	  	 	—	  	  	 	30,247	  	  	 	30,247	  	
Finance lease payables (Note 10)	  	 	—	  	  	 	—	  	  	 	3,483	  	  	 	3,483	  	
Payable to Group companies (Note 26)	  	 	—	  	  	 	—	  	  	 	38	  	  	 	38	  	
Trade and other payables (Note 18)	  	 	—	  	  	 	—	  	  	 	312,990	  	  	 	312,990	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Current financial liabilities	  	 	—	  	  	 	—	  	  	 	349,145	  	  	 	349,145	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
TOTAL FINANCIAL LIABILITIES	  	 	52,275	  	  	 	—	  	  	 	1,581,608	  	  	 	1,633,883	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Excluding deferred income and non-financial liabilities.

 	  	Thousands of U.S. dollars	 	
2013	  	Liabilities at fair
value through
profit and loss	 	  	Derivatives	 	  	Other
financial
liabilities at
amortized cost	 	  	Total	 	
Debentures and bonds (Note 17)	  	 	—	  	  	 	—	  	  	 	631,853	  	  	 	631,853	  	
Interest-bearing debt (Note 17)	  	 	—	  	  	 	—	  	  	 	527	  	  	 	527	  	
Finance lease payables (Note 10)	  	 	—	  	  	 	—	  	  	 	6,536	  	  	 	6,536	  	
CVIs (Note 17)	  	 	43,367	  	  	 	—	  	  	 	—	  	  	 	43,367	  	
Vendor Loan (Note 17)	  	 	—	  	  				  	 	151,701	  	  	 	151,701	  	
Payable to Group companies (Note 26)	  	 	—	  	  	 	—	  	  	 	519,607	  	  	 	519,607	  	
Financial derivative instruments (Note 14)	  	 	—	  	  	 	15,962	  	  	 	—	  	  	 	15,962	  	
Trade and other payables (Note 18)	  	 	—	  	  	 	—	  	  	 	1,033	  	  	 	1,033	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Non-current financial liabilities	  	 	43,367	  	  	 	15,962	  	  	 	1,311,257	  	  	 	1,370,586	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Debentures and bonds (Note 17)	  	 	—	  	  	 	—	  	  	 	11,682	  	  	 	11,682	  	
Interest-bearing debt (Note 17)	  	 	—	  	  	 	—	  	  	 	105	  	  	 	105	  	
Finance lease payables (Note 10)	  	 	—	  	  	 	—	  	  	 	5,341	  	  	 	5,341	  	
Trade and other payables (Note 18)	  	 	—	  	  	 	—	  	  	 	269,789	  	  	 	269,789	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Current financial liabilities	  				  	 	—	  	  	 	286,917	  	  	 	286,917	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
TOTAL FINANCIAL LIABILITIES	  	 	43,367	  	  	 	15,962	  	  	 	1,598,174	  	  	 	1,657,503	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Excluding deferred income and non-financial liabilities.
The maturity schedule for Other financial liabilities, trade and other payables and liabilities at fair value through profit and loss at December 31, 2012 and 2013 is as follows:

2012	  	Thousands of U.S. dollars	 	
	  	Maturity (years)	 	
	  	2013	 	  	2014	 	  	2015	 	  	2016	 	  	2017	 	  	More
than
5 years	 	  	Total	 	
Payables to Group companies	  	 	38	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	471,624	  	  	 	471,662	  	
Finance leases	  	 	3,483	  	  	 	5,213	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	8,696	  	
Bank borrowings and debentures	  	 	32,634	  	  	 	58,569	  	  	 	85,100	  	  	 	108,013	  	  	 	146,310	  	  	 	212,441	  	  	 	643,067	  	
CVIs	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	52,275	  	  	 	52,275	  	
Vendor Loan	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	145,134	  	  	 	145,134	  	
Trade and other payables	  	 	312,990	  	  	 	59	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	313,049	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total financial liabilities	  	 	349,145	  	  	 	63,841	  	  	 	85,100	  	  	 	108,013	  	  	 	146,310	  	  	 	881,474	  	  	 	1,633,883	  	

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The Brazilian debentures contract established the following original repayment schedule:

2014	  	2015	 	 	2016	 	 	2017	 	 	2018	 	 	2019	 	 	Total	 	
7%	  	 	11	% 	 	 	15	% 	 	 	18	% 	 	 	21	% 	 	 	28	% 	 	 	100	% 	
As indicated in Note 17, the Brazilian subsidiary made two early repayments in 2013, totaling 47.8 million U.S. dollars. The new repayment schedule after both early payments is as follows:

2014	  	2015	 	 	2016	 	 	2017	 	 	2018	 	 	2019	 	 	Total	 	
—	  	 	7.2863	% 	 	 	15	% 	 	 	18	% 	 	 	21	% 	 	 	28	% 	 	 	89.3	% 	

2013	  	Thousands of U.S. dollars	 	
	  	Maturity (years)	 	
	  	2014	 	  	2015	 	  	2016	 	  	2017	 	  	2018	 	  	More than
5 years	 	  	Total	 	
Payables to Group companies	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	519,607	  	  	 	519,607	  	
Senior Secured Notes	  	 	9,342	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	288,339	  	  	 	297,681	  	
Brazilian bonds—Debentures	  	 	2,340	  	  	 	27,518	  	  	 	57,804	  	  	 	69,365	  	  	 	80,926	  	  	 	107,901	  	  	 	345,854	  	
Finance leases	  	 	5,341	  	  	 	4,157	  	  	 	1,081	  	  	 	974	  	  	 	324	  	  	 	—	  	  	 	11,877	  	
Bank borrowings	  	 	105	  	  	 	393	  	  	 	134	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	632	  	
CVIs	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	43,367	  	  	 	43,367	  	
Vendor Loan	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	151,701	  	  	 	151,701	  	
Trade and other payables	  	 	269,789	  	  	 	1,033	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	270,822	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total financial liabilities	  	 	286,917	  	  	 	33,101	  	  	 	59,019	  	  	 	70,339	  	  	 	81,250	  	  	 	1,110,915	  	  	 	1,641,541	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
17) INTEREST-BEARING DEBT
Details of interest-bearing debt at December 31, 2012 and 2013 are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	12/31/2012	 	  	31/12/2013	 	
Senior Secured Notes	  	 	—	  	  	 	288,339	  	
Brazilian bonds—Debentures	  	 	440,568	  	  	 	343,514	  	
Bank borrowings	  	 	169,865	  	  	 	527	  	
CVIs	  	 	52,275	  	  	 	43,367	  	
Vendor Loan	  	 	145,134	  	  	 	151,701	  	
Finance lease payables (Note 10)	  	 	5,213	  	  	 	6,536	  	
	  	 	 	 	  	 	 	 	
Sub-total borrowings with third parties	  	 	813,055	  	  	 	833,984	  	
Payable to Group companies (Note 26)	  	 	471,624	  	  	 	519,607	  	
	  	 	 	 	  	 	 	 	
Total non-current	  	 	1,284,679	  	  	 	1,353,591	  	
	  	 	 	 	  	 	 	 	
Senior Secured Notes	  	 	—	  	  	 	9,342	  	
Brazilian bonds—Debentures	  	 	2,387	  	  	 	2,340	  	
Bank borrowings	  	 	30,247	  	  	 	105	  	
Finance lease payables (Note 10)	  	 	3,483	  	  	 	5,341	  	
	  	 	 	 	  	 	 	 	
Sub-total borrowings with third parties	  	 	36,117	  	  	 	17,128	  	
Payable to Group companies (Note 26)	  	 	38	  	  	 	—	  	
	  	 	 	 	  	 	 	 	
Total current	  	 	36,155	  	  	 	17,128	  	
	  	 	 	 	  	 	 	 	
TOTAL INTEREST-BEARING DEBT	  	 	1,320,834	  	  	 	1,370,719	  	

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Issuance of bonds—Senior Secured Notes
 
 	•	 	On January 29, 2013 Atento Luxco 1, S.A. issued 300,000 bonds with a nominal value of 1,000 U.S. dollars each, bearing interest at an annual rate of 7.375%. The bonds mature on January 29, 2020, and the issuer may redeem them early as of January 29, 2016, if certain conditions have been met.	
Details of the senior secured notes issuances at December 31, 2013 are as follows:

Issuer	  	Issue date	 	  	Number of
bonds	 	  	Unit nominal value	 	  	Annual
interest rate	 	 	Maturity	 	
Atento Luxco 1, S.A.	  	 	January 29, 2013	  	  	 	300,000	  	  	 	1,000 U.S. dollars	  	  	 	7.375	% 	 	 	January 29, 2020	  	
All interest payments are made on a half-yearly basis.
Fair value of debt in relation to the issuance of senior secured notes, calculated on the basis of their quoted price at December 31, 2013, is 276,056 thousand U.S. dollars.
The fair value hierarchy of the senior secured notes is level 1 as it based in the market price at the reporting date.
Details of the corresponding debt at each reporting date are as follows:

 	  	 	 	  	Thousands of U.S. dollars	 	
 	  	 	 	  	12/31/2012	 	  	12/31/2013	 	
Maturity	  	Currency	 	  	Principal	 	  	Accrued
interests	 	  	Total
debt	 	  	Principal	 	  	Accrued
interests	 	  	Total
debt	 	
2020	  	 	U.S. Dollar	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	288,339	  	  	 	9,342	  	  	 	297,681	  	
Brazilian bonds—Debentures
 
 	•	 	On November 22, 2012 BC Brazilco Participações, S.A. (now merged with Atento Brasil, S.A.) issued preferential bonds in Brazil (the “ Debentures ”), which were subscribed by institutional investors (the “ Debenture holders ”) and assumed by Bain, for an initial amount of 915,000 thousand Brazilian reais (equivalent to 365,000 thousand U.S. dollars). This long-term financial commitment matures in 2019 and bears interest pegged to the Brazilian CDI (Interbank Deposit Certificate) rate plus 3.70%. Interest is paid on a half-yearly basis.	
On March 25, 2013 and June 11, 2013 Atento Brasil, S.A. repaid, in advance of the scheduled date, 71,589 thousand Brazilian reais and 26,442 thousand Brazilian reais respectively (equivalent to 35,545 thousand U.S. dollars and 12,287 thousand U.S. dollars, respectively).
Under the terms of the financing contract, the Brazilian subsidiary is subject to a financial covenant regarding the maximum debt level at the end of each quarter. To date, the company has complied with this covenant and does not foresee any future non-compliance.
Details of the corresponding debt at each reporting date are as follows:

 	  	 	 	  	Thousands of U.S. dollars	 	
 	  	 	 	  	12/31/2012	 	  	12/31/2013	 	
Maturity	  	Currency	 	  	Principal	 	  	Accrued
interests	 	  	Total
debt	 	  	Principal	 	  	Accrued
interests	 	  	Total
debt	 	
2019	  	 	Brazilian real	  	  	 	440,568	  	  	 	2,387	  	  	 	442,955	  	  	 	343,514	  	  	 	2,340	  	  	 	345,854	  	
The carrying amount of debentures is similar to the fair value. The fair value is based on cash flows discounted and is within level 2 of the fair value hierarchy.
 
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Bank borrowings
Bank borrowings are held in the following currencies:

 	  	12/31/2012	 	  	12/31/2013	 	
 	  	Foreign
currency debt
(thousands)	 	  	U.S. Dollars debt
(thousands)	 	  	Foreign
currency debt
(thousands)	 	  	U.S. Dollars
debt
(thousands)	 	
EUR	  	 	85,280	  	  	 	112,519	  	  	 	—	  	  	 	—	  	
COP	  	 	9,850	  	  	 	5	  	  	 	—	  	  	 	—	  	
MXN	  	 	1,124,912	  	  	 	86,761	  	  	 	—	  	  	 	—	  	
MAD	  	 	7,017	  	  	 	827	  	  	 	5,170	  	  	 	632	  	
	  				  	 	 	 	  				  	 	 	 	
Total	  				  	 	200,112	  	  				  	 	632	  	
	  				  	 	 	 	  				  	 	 	 	
The carrying amount of bank borrowings is similar to the fair value. The fair value is based on cash flows discounted and is within level 2 of the fair value hierarchy.
 
 	•	 	As explained above, on January 29, 2013 Atento Luxco 1, S.A. issued bonds totaling 300 million U.S. dollars. In addition, on January 28, 2013 Atento Luxco 1, S.A., Atento Teleservicios España, S.A.U. and Atento Mexicana, S.A. de C.V. contracted a multi-currency revolving facility (“Super Senior Revolving Credit Facilities Agreement” or “SSRCF”) for 67 million U.S. dollars (69 million U.S. dollars at December 31, 2013) from Banco Santander, S.A. and Banco Santander (Mexico), S.A. Institución de Banca Múltiple, Grupo Financiero Santander México, Banco Bilbao Vizcaya Argentaria, S.A. and BBVA Bancomer, S.A. Institución de Banca Múltiple, Grupo Financiero BBVA Bancomer as original lenders, and Banco Bilbao Vizcaya Argentaria, S.A. as the agent bank. The original guarantors for the loan are Atento Luxco 1 S.A., Atento Teleservicios España, S.A.U., Atento Mexicana, S.A. de C.V. Mexico and Atento Servicios, S.A. de C.V.	
The new revolving facility allows for drawdowns in euros, Mexican pesos and U.S. dollars. The interest rates for euro drawdowns and Mexican peso drawdowns are the Euribor and the TIIE, respectively, and the LIBOR for drawdowns in any other currency, plus a 4.5% spread per year. This spread is subject to a step-down based on the debt ratio calculation.
The facility matures on July 28, 2019. At December 31, 2013 no amounts had been drawn down on the facility.
In view of the financing received as mentioned above, the following contracts drawn up in 2012 in Spain and Mexico were cancelled:
 
 	•	 	On October 11, 2012 Atento Spain Holdco 2, S.A.U. (formerly Global Laurentia, S.L.U.) received a borrowing from Banco Santander, S.A., BBVA Bancomer, S.A., Banco Bilbao Vizcaya Argentaria, S.A. and CaixaBank, S.A., with Banco Bilbao Vizcaya Argentaria, S.A. acting as the agent bank. At December 31, 2012, the 105,552 thousand U.S. dollars borrowing also carried a 10,555 thousand U.S. dollars credit facility, maturing on October 11, 2017. This borrowing was assumed by Bain. The nominal interest rate applied in each period was the quarterly Euribor plus a 5 pp spread. At December 31, 2012, the company had drawn down 112,519 thousand U.S. dollars on the credit facility.	
 
 	•	 	On December 11, 2012 Atento Mexico Holdco, S. de R.L. de C.V. (formerly BC Atalaya Mexholdco, S.A. de R.L. de C.V.) received a borrowing from Banco Santander (Mexico), S.A. and BBVA Bancomer, S.A., with BBVA Bancomer, S.A. acting as the agent bank. The 1,000,000 thousand Mexican pesos borrowing (equivalent to 79,164 thousand U.S. dollars) also carried a 100,000 thousand Mexican pesos credit facility (equivalent to 7,916 thousand U.S. dollars) maturing on December 12, 2017. The nominal interest rate was the quarterly TIIE plus a 5 pp spread. At December 31, 2012 the company had drawn down the entire credit facility.	
 
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 	•	 	Atento Colombia, S.A. held a borrowing granted from BBVA Colombia. At December 31, 2012 the balance on the loan amounted to 9,850 thousand Colombian pesos (equivalent to 5 thousand U.S. dollars). The borrowing matured on February 28, 2013. The interest on the loan was pegged to the DTF plus a spread of 1.8%.	
 
 	•	 	Atento Maroc, S.A. held a borrowing granted from Banco Sabadell. At November 30, 2012 the subsidiary made an early repayment amounting 10 million dirhams. At December 31, 2013 the borrowing balance was 5,082 thousand Moroccan dirham (equivalent to 632 thousand U.S. dollars) (7,017 thousand Moroccan dirham or 827 thousand U.S. dollars at December 31, 2012). The loan matures on June 28, 2016 and bears interest at 6%.	
Contingent Value Instruments (CVIs)
 
 	•	 	In relation to the acquisition described in Notes 1 and 5, two of the Company’s subholdings, Atalaya Luxco 2, S.a.r.l. (formerly BC Luxco 2, S.a.r.l.) and Atalaya Luxco 3, S.a.r.l. (formerly BC Luxco 3, S.a.r.l.), which held stakes in the Atento Group’s Argentinian subsidiaries, issued a contingent value instrument (CVI) with the counterparties Atento Inversiones y Teleservicios, S.A. and Venturini S.A., a Telefónica subsidiary. The CVIs together have an aggregated nominal value of 666.8 million Argentinian pesos.	
The CVIs represent preferential debt of Atalaya Luxco 2 and Atalaya Luxco 3, and are subject to mandatory (partial) repayment in the following scenarios: (i) if the Argentinian subsidiaries maintain an excess-distributable cash balance, calculated as the greater of the sum of 30.3 million Argentinian pesos (adjusted considering inflation) and the sum that must be maintained by the subsidiaries to honor their financial obligations in each year, pursuant to their business plans; (ii) sale of all or substantially all the shares of the Argentinian subsidiaries in respect of which the cash proceeds are distributed to Atalaya Luxco 2 and Atalaya Luxco 3; (iii) sale of the Atento Group whereby a portion of the price is allocated to the Argentinian subsidiaries and (iv) payment of dividends by the Argentinian subsidiaries.
The aforementioned instrument will be extinguished at the date on which the principal amount and interest pending payment show a zero balance (in respect of repayment of outstanding debt or reduction of the outstanding balance pursuant to the terms and conditions of the CVIs). Without prejudice to the above, the conditions of the CVIs stipulate that on October 12, 2022 the balance of this debt will be reduced to zero. Moreover, the principal amount pending payment must be reduced by the aggregate amount of any damages that may be incurred by the Argentinian subsidiaries as the result of incompliance with the clauses stipulated in the purchase contract between Bain Capital and Telefonica. The CVIs do not bear interest and are recognized at fair value. During the term of the CVIs, holders have preferential purchase rights in the event the Argentinian subsidiaries are sold.
Vendor Loan
 
 	•	 	With respect to the acquisition described in Notes 1 and 5 to the accompanying consolidated financial statements, the Company issued a euro-denominated Vendor Loan Note (Vendor Loan) to a Telefónica branch, amounting to the equivalent of approximately 143 million U.S. dollars. The Vendor Loan matures at December 12, 2022, and accrues an annual 5% of fixed interest, payable annually. Interest must be paid in cash if, and to the extent that: i) there is no ongoing default (or similar situation), or no default situation arises with respect to any Atento Group financing, in accordance with the Vendor Loan agreements, as a result of the payment of said interest or any distribution or payment made by a subsidiary to the Company so that it may make the interest payments; ii) the lender has received payments from its subsidiaries that correspond to the lesser of (A) the expenses incurred during the period of interest accrual with respect to the Atento Group transaction plus those management and advisory expenses paid to Bain Capital or (B) 45 million U.S. dollars (increased by the compounded 3% for each subsequent interest accrual period); and iii) the Atento Group can legally contribute funds	
 
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 	to the Company. Any interest that is not paid in cash will be capitalized and added to the principal pending payment. In addition, after the sale of at least 66.66% of the business and assets of the Atento Group, the Company is obliged to use the funds received from said sale to repay the Vendor Loan, as established in points (i) and (iii) above.	
The Vendor Loan has preferential collection rights over any claims for debt or equity held by shareholders of the Company and its subsidiaries; is pari passu with the debts incurred in the ordinary course of Company business; and is also subordinate to the remaining debts of the Company. The Vendor Loan includes certain restrictions relating to Atento Group payments to Bain Capital and associates which will become effective if the ratio of the Atento Group’s financial debt to EBITDA exceeds the 1.0 to 2.5 range.
The Vendor Loan does not include any other covenant or commitment. The Vendor Loan does not include the right to make any claims against Group companies (in the form of guarantees, interest, or other) or any non-payment event related to the Group’s operational entities. The Vendor Loan does not include any cross-default or cross-acceleration provisions.
The Company can fully or partially repay the loan, without incurring any premium or penalty, at any moment before the maturity date, provided that said payment includes accrued interest pending payment.
The carrying amount of the Vendor Loan approximately corresponds to its fair value.
The fair value is based on cash flows discounted and is within level 2 of the fair value hierarchy.
18) TRADE AND OTHER PAYABLES
Details of trade and other payables at December 31, 2012 and 2013 are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	12/31/2012	 	  	12/31/2013	 	
Other payables	  	 	59	  	  	 	1,033	  	
Deferred income	  	 	29	  	  	 	408	  	
	  	 	 	 	  	 	 	 	
Total non-current	  	 	88	  	  	 	1,441	  	
	  	 	 	 	  	 	 	 	
Suppliers	  	 	109,881	  	  	 	109,635	  	
Advances	  	 	7,323	  	  	 	262	  	
Suppliers of fixed assets	  	 	53,217	  	  	 	29,500	  	
Personnel	  	 	123,839	  	  	 	124,795	  	
Other payables	  	 	18,730	  	  	 	5,597	  	
Deferred income	  	 	1,314	  	  	 	859	  	
	  	 	 	 	  	 	 	 	
Total current	  	 	314,304	  	  	 	270,648	  	
	  	 	 	 	  	 	 	 	
Total current and non-current	  	 	314,392	  	  	 	272,089	  	
	  	 	 	 	  	 	 	 	
The carrying amount of trade and other payables is similar to the fair value, as the impact of discounting is not significant.
19) EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT
Share capital
At December 31, 2012 and 2013 share capital stood at 2,592,201 U.S. dollars, divided into 2,000,000 shares with a par value of 1 euro each, fully paid in.
All shares were subscribed by ATALAYA Luxco TOPCO, S.C.A.
 
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The table below shows movements in share capital:

 	  	 	  	U.S. Dollars	 	
November 27 , 2012	  	Inception of the Company:
2,000,000 shares, each with par value 1 euro	  	 	2,592,201	  	
	  		  	 	 	 	
Share capital at December 31, 2012 and 2013	  	 	2,592,201	  	
	  		  	 	 	 	
Legal reserve
According to mercantile legislation in Luxembourg, Atalaya Luxco Midco, S.a.r.l. must transfer 5% of profits for the year to a legal reserve until the reserve reaches 10% of share capital. The legal reserve cannot be distributed.
At December 31, 2012 and 2013, no legal reserve had been established.
Retained earnings
Movements in retained earnings during 2012 and 2013 are as follows:

 	  	Thousands of
U.S. dollars	 	
Losses incurred in 2012	  	 	(56,620	) 	
At December 31, 2012	  	 	(56,620	) 	
Loss for 2013	  	 	(4,039	) 	
	  	 	 	 	
At December 31, 2013	  	 	(60,659	) 	
	  	 	 	 	
Translation differences
Translation differences reflect the differences arising on account of exchange rate fluctuations when converting the net assets of fully consolidated foreign companies from local currency to Atento Group’s presentation currency (U.S. dollars) by the full consolidation method.
Valuation adjustments
Movements in valuation adjustments in 2012 and 2013 were as follows:

 	  	Thousands of
U.S. dollars	 	
At December 31, 2012	  	 	—	  	
Cash flow hedges	  	 	1,627	  	
	  	 	 	 	
At December 31, 2013	  	 	1,627	  	

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20) TAX MATTERS
a) Income tax
The reconciliation between the income tax expense that would result in applying the statutory tax rate and the income tax expense recorded is as follows:

 	  	Thousands of U.S. dollars	 	
 	  	December 1 to
December 31,
2012	 	 	For the year
ended
December 31,
2013	 	
Profit before tax	  	 	(48,489	) 	 	 	4,307	  	
Income tax applying the statutory tax rate	  	 	(10,183	) 	 	 	904	  	
Permanent differences	  	 	7,733	  	 	 	17,291	  	
Adjustments due to international tax rates	  	 	10,574	  	 	 	(9,866	) 	
Other	  	 	8	  	 	 	17	  	
	  	 	 	 	 	 	 	 	
Total income tax expense (income)	  	 	8,132	  	 	 	8,346	  	
	  	 	 	 	 	 	 	 	
Permanent differences in 2012 are mainly due to provisions in Brazil and Mexico which are not deductible for tax purposes. Permanent differences in 2013 are mainly due to provisions in Brazil which are not deductible for tax purposes.
The breakdown of the Atento Group’s income tax expense is as follows:

 	  	Thousands of U.S. dollars	 	
 	  	  December 1 to  
December 31,
2012	 	  	For the year
ended
December 31,
2013	 	
Current tax expense / (income)	  	 	3,209	  	  	 	23,953	  	
Deferred tax	  	 	4,768	  	  	 	(11,372	) 	
Adjustment to prior years	  	 	155	  	  	 	(4,235	) 	
	  	 	 	 	  	 	 	 	
Total income tax expense (income)	  	 	8,132	  	  	 	8,346	  	
	  	 	 	 	  	 	 	 	
The effective tax rate on Atento Group’s consolidated earnings in 2012 was (16.77%). This rate is distorted because of the contribution of losses in the holding companies comprising the Group to Atento’s pre-tax result. For these losses, Atento has not registered the corresponding deferred tax assets. Stripping out this effect, pre-tax profit would have stood at 26,101 thousand U.S. dollars, with an income tax expense of 8,121 thousand U.S. dollars. Consequently, the aggregate rate excluding the Group’s holding companies is 31.11%, in line with the reasonable parameters for a similar group.
The effective tax rate on Atento Group’s consolidated earnings in 2013 was 193.79%. This rate is distorted because of the contribution of losses in the holding companies comprising the Group to Atento’s pre-tax result. Stripping out this effect, pre-tax profit would have stood at 111,272 thousand U.S. dollars, with an income tax expense of 33,378 thousand U.S. dollars. Consequently, the aggregate rate excluding the Group’s holding companies is 30%, in line with the reasonable parameters for a similar group.
The years open for inspection by the tax authorities for the main taxes applicable vary from one consolidated company to another, based on each country’s tax legislation, taking into account their respective statute-of-limitations periods. The directors of the Atento Group consider that no significant contingencies would arise from a review by the tax authorities of the operations in the years open to inspection, other than those described in Note 21.
 
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b) Deferred tax assets and liabilities
The breakdown and balances of deferred tax assets and deferred tax liabilities at December 31, 2012 and 2013 are as follows:

 	  	Thousand U.S. dollars	 	
 	  	Balance at
12/01/2012	 	 	Results	 	 	Transfers	 	 	Translation
differences	 	 	Balance at
12/31/2012	 	
 	  			 	Increases	 	 	Decreases	 	 			 			 			
DEFERRED TAX ASSETS	  	 	189,209	  	 	 	16,410	  	 	 	(21,135	) 	 	 	7	  	 	 	5,802	  	 	 	190,293	  	
Unused tax losses ( * )	  	 	5,550	  	 	 	786	  	 	 	(1,807	) 	 	 	(152	) 	 	 	118	  	 	 	4,495	  	
Unused tax credits	  	 	4,921	  	 	 	3,844	  	 	 	(8,577	) 	 	 	171	  	 	 	51	  	 	 	410	  	
Deferred tax assets (temporary differences)	  	 	178,738	  	 	 	11,780	  	 	 	(10,751	) 	 	 	(12	) 	 	 	5,633	  	 	 	185,388	  	
							
DEFERRED TAX LIABILITIES	  	 	(135,064	) 	 	 	(43	) 	 	 	(3	) 	 	 	(87	) 	 	 	(2,882	) 	 	 	(138,079	) 	
Deferred tax liabilities (temporary differences)	  	 	(135,064	) 	 	 	(43	) 	 	 	(3	) 	 	 	(87	) 	 	 	(2,882	) 	 	 	(138,079	) 	

(*)	Tax credits for loss carryforwards.	

 	 	Thousand U.S. dollars	 	
 	 	Balance at
12/31/2012	 	 	Results	 	 	Equity	 	 	Transfers	 	 	Translation
differences	 	 	Balance at
12/31/2013	 	
 	 			 	Increases	 	 	Decreases	 	 	Increases	 	 	Decreases	 	 			 			 			
DEFERRED TAX ASSETS	 	 	190,293	  	 	 	27,856	  	 	 	(17,207	) 	 	 	—	  	 	 	—	  	 	 	—	  	 	 	(21,003	) 	 	 	179,939	  	
Unused tax losses ( * )	 	 	4,495	  	 	 	18,584	  	 	 	(2,104	) 	 	 	—	  	 	 	—	  	 	 	—	  	 	 	339	  	 	 	21,314	  	
Unused tax credits	 	 	410	  	 	 	7,467	  	 	 	(7,221	) 	 	 	—	  	 	 	—	  	 	 	—	  	 	 	(142	) 	 	 	514	  	
Deferred tax assets (temporary differences)	 	 	185,388	  	 	 	1,805	  	 	 	(7,882	) 	 	 	—	  	 	 	—	  	 	 	—	  	 	 	(21,200	) 	 	 	158,111	  	
									
DEFERRED TAX LIABILITIES	 	 	(138,079	) 	 	 	(458	) 	 	 	15,538	  	 	 	(3,001	) 	 	 	1	  	 	 	—	  	 	 	6,717	  	 	 	(119,282	) 	
Deferred tax liabilities (temporary differences)	 	 	(138,079	) 	 	 	(458	) 	 	 	15,538	  	 	 	(3,001	) 	 	 	1	  	 	 	—	  	 	 	6,717	  	 	 	(119,282	) 	

(*)	Tax credits for loss carryforwards.	
As a result of the business combination described in note 5, the Company recognized deferred tax assets amounting to approximately 100 million U.S. dollars from existing Brazilian tax regulations which permit companies to deduct goodwill arising from business combinations. Such deferred tax asset amounted to 72 million U.S. dollars at December 31, 2013 (2012: 103 million U.S. dollars). The Company also considered this amount as part of the assets acquired in the business combination. The remaining amount relates to the differences in tax and accounting criteria for recognizing the Company’s provisions for risks. Additional deferred tax assets arising from the business combinations amounting to 31 million U.S. dollars were recorded due to the recognition of labor contingencies and others. The remaining amount relates to the differences in tax and accounting criteria for recognizing the Company’s provisions for risks.
As a result of the business combination described in note 5, the Company recognized deferred tax liabilities amounting to 129 million U.S. dollars due to the difference between the tax value of the customer base and the fair value allocated in the business combination, which amounted to 113 million U.S. dollars at December 31, 2013 (2012: 131 million U.S. dollars).
 
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The following table presents the schedule for the reversal of recognized and unrecognized deferred tax assets and liabilities in the statement of financial position based on the best estimates available at the respective estimation dates:

 	 	Thousands of U.S. dollars	 	
2012	 	2013	 	 	2014	 	 	2015	 	 	2016	 	 	2017	 	 	2018	 	 	Subsequent years	 	 	Total	 	
Tax losses	 	 	1,760	  	 	 	2,735	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	4,495	  	
Deductible temporary differences	 	 	66,566	  	 	 	23,394	  	 	 	20,562	  	 	 	20,552	  	 	 	20,552	  	 	 	—	  	 	 	33,762	  	 	 	185,388	  	
Tax credits for deductions	 	 	410	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	410	  	
Total deferred tax assets	 	 	68,736	  	 	 	26,129	  	 	 	20,562	  	 	 	20,552	  	 	 	20,552	  	 	 	—	  	 	 	33,762	  	 	 	190,293	  	
Total deferred tax liabilities	 	 	2,103	  	 	 	1,252	  	 	 	806	  	 	 	676	  	 	 	602	  	 	 	574	  	 	 	132,066	  	 	 	138,079	  	

 	 	Thousands of U.S. dollars	 	
2013	 	2014	 	 	2015	 	 	2016	 	 	2017	 	 	2018	 	 	2019	 	 	Subsequent years	 	 	Total	 	
Tax losses	 	 	1,023	  	 	 	496	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	19,795	  	 	 	21,314	  	
Deductible temporary differences	 	 	35,120	  	 	 	13,489	  	 	 	11,860	  	 	 	11,696	  	 	 	11,630	  	 	 	11,605	  	 	 	62,711	  	 	 	158,111	  	
Tax credits for deductions	 	 	514	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	514	  	
Total deferred tax assets	 	 	36,657	  	 	 	13,985	  	 	 	11,860	  	 	 	11,696	  	 	 	11,630	  	 	 	11,605	  	 	 	82,506	  	 	 	179,939	  	
Total deferred tax liabilities	 	 	2,213	  	 	 	775	  	 	 	692	  	 	 	621	  	 	 	600	  	 	 	600	  	 	 	113,781	  	 	 	119,282	  	
In addition, the Atento Group has not capitalized certain tax losses amounting to 71 million U.S. dollars generated by the holding companies in the one-month period ended December 31, 2012. These tax losses predate the tax consolidation described in section c).
The balance of deferred taxes related with items in other comprehensive income is as follows:

 	  	Thousands of
U.S. dollars	 	
 	  	2013	 	
Cash flow hedges	  	 	(3,001	) 	
c) Tax consolidation
Since January 1, 2013, certain Atento Group companies in Spain form part of consolidated tax group 230/13, paying income tax as part of that group. The following companies form part of the consolidated tax group:
Parent Company: Atento Spain Holdco S.L.U. (formerly Global Chaucer, S.L.U.) Subsidiaries:
 
 	•	 	Atento Teleservicios España, S.A.U.	
 
 	•	 	Atento Servicios Técnicos y Consultoría, S.A.U.	
 
 	•	 	Atento Impulsa, S.A.U.	
 
 	•	 	Atento Servicios Auxiliares de Contact Center, S.A.U.	
 
 	•	 	Atento Spain Holdco 5, S.L.U. (formerly Global Kiowa, S.L.U.)	
 
 	•	 	Atento Spain Holdco 6, S.L.U. (formerly Global Benoni, S.L.U.)	
 
 	•	 	Atento Spain Holdco 2, S.L.U. (formerly Global Laurentia, S.L.U.)	
 
 	•	 	Atento Spain Holdco 4, S.A.U. (formerly BC Spain Holdco, S.A.U.)	
 
 	•	 	Global Rossolimo, S.L.U.	
 
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Loss carryforwards recognized by the tax group in 2013 (corrected for any adjustments on tax consolidation), amounting to 58,195 thousand U.S. dollars, will be offset by future profits obtained by the consolidated group.
d) Public administrations
Details of receivables from public administrations and payables to public administrations at December 31, 2012 and 2013 are as follows:

 	  	Thousands of U.S. dollars	 	
Receivables	  	    2012    	 	  	    2013    	 	
Current	  				  				
Indirect taxes	  	 	5,499	  	  	 	5,887	  	
Other taxes	  	 	12,618	  	  	 	12,891	  	
Income tax	  	 	9,536	  	  	 	12,962	  	
	  	 	 	 	  	 	 	 	
Total	  	 	27,653	  	  	 	31,740	  	

									
 	  	Thousands of U.S. dollars	 	
Payables	  	    2012    	 	  	    2013    	 	
Non-current	  				  				
Social security	  	 	—	  	  	 	1,949	  	
Current	  				  				
Indirect taxes	  	 	16,518	  	  	 	28,317	  	
Other taxes	  	 	59,729	  	  	 	46,666	  	
Income tax	  	 	18,688	  	  	 	7,582	  	
	  	 	 	 	  	 	 	 	
Total	  	 	94,935	  	  	 	84,514	  	
	  	 	 	 	  	 	 	 	
21) PROVISIONS AND CONTINGENCIES
Movements in provisions during 2012 and 2013 were as follows:

 	 	Thousands of U.S. dollars	 	
 	 	12/01/2012	 	 	Allocation	 	 	Application	 	 	Reversal	 	 	Discounted	 	 	Transfers	 	 	Translation
differences	 	 	12/31/2012	 	
Non-current	 				 				 				 				 				 				 				 				
Provisions for liabilities	 	 	3,346	  	 	 	494	  	 	 	(494	) 	 	 	—	  	 	 	—	  	 	 	74,823	  	 	 	1,116	  	 	 	79,285	  	
Provisions for taxes	 	 	4,849	  	 	 	6,217	  	 	 	(5,678	) 	 	 	—	  	 	 	—	  	 	 	—	  	 	 	44	  	 	 	5,432	  	
Provisions for dismantling	 	 	15,004	  	 	 	1	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	458	  	 	 	15,463	  	
Other provisions	 	 	355	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	6	  	 	 	361	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total non-current	 	 	23,554	  	 	 	6,712	  	 	 	(6,172	) 	 	 	—	  	 	 	—	  	 	 	74,823	  	 	 	1,624	  	 	 	100,541	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Current	 				 				 				 				 				 				 				 				
Provisions for liabilities	 	 	96,111	  	 	 	1,943	  	 	 	(932	) 	 	 	(1,628	) 	 	 	—	  	 	 	(74,823	) 	 	 	1,277	  	 	 	21,948	  	
Provisions for taxes	 	 	916	  	 	 	(17	) 	 	 	—	  	 	 	27	  	 	 	—	  	 	 	—	  	 	 	12	  	 	 	938	  	
Provisions for dismantling	 	 	29	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	29	  	
Other provisions	 	 	4,802	  	 	 	1,449	  	 	 	(4,363	) 	 	 	50	  	 	 	—	  	 	 	—	  	 	 	41	  	 	 	1,979	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total current	 	 	101,858	  	 	 	3,375	  	 	 	(5,295	) 	 	 	(1,551	) 	 	 	—	  	 	 	(74,823	) 	 	 	1,330	  	 	 	24,894	  	

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 	 	Thousands of U.S. dollars	 	
 	 	12/31/2012	 	 	Allocation	 	 	Application	 	 	Reversal	 	 	Discounted	 	 	Transfers	 	 	Translation
differences	 	 	12/31/2013	 	
Non-current	 				 				 				 				 				 				 				 				
Provisions for liabilities	 	 	79,285	  	 	 	7,638	  	 	 	(15,360	) 	 	 	—	  	 	 	—	  	 	 	11,669	  	 	 	(10,416	) 	 	 	72,816	  	
Provisions for taxes	 	 	5,432	  	 	 	5,750	  	 	 	(313	) 	 	 	—	  	 	 	616	  	 	 	—	  	 	 	(1,194	) 	 	 	10,291	  	
Provisions for dismantling	 	 	15,463	  	 	 	2,296	  	 	 	(149	) 	 	 	—	  	 	 	1	  	 	 	(135	) 	 	 	(2,008	) 	 	 	15,468	  	
Other provisions	 	 	361	  	 	 	1	  	 	 	(396	) 	 	 	—	  	 	 	74	  	 	 	446	  	 	 	1	  	 	 	487	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total non-current	 	 	100,541	  	 	 	15,685	  	 	 	(16,218	) 	 	 	—	  	 	 	691	  	 	 	11,980	  	 	 	(13,617	) 	 	 	99,062	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Current	 				 				 				 				 				 				 				 				
Provisions for liabilities	 	 	21,948	  	 	 	3,476	  	 	 	(3,634	) 	 	 	(475	) 	 	 	—	  	 	 	(11,668	) 	 	 	(2,455	) 	 	 	7,192	  	
Provisions for taxes	 	 	938	  	 	 	—	  	 	 	85	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	(85	) 	 	 	938	  	
Provisions for dismantling	 	 	29	  	 	 	72	  	 	 	(28	) 	 	 	—	  	 	 	—	  	 	 	135	  	 	 	(1	) 	 	 	207	  	
Other provisions	 	 	1,979	  	 	 	5,789	  	 	 	—	  	 	 	(1,300	) 	 	 	—	  	 	 	(446	) 	 	 	159	  	 	 	6,181	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total current	 	 	24,894	  	 	 	9,337	  	 	 	(3,577	) 	 	 	(1,775	) 	 	 	—	  	 	 	(11,979	) 	 	 	(2,382	) 	 	 	14,518	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
“Provisions for liabilities” primarily relates to provisions for legal claims underway in Brazil. As indicated in note 12 “Other financial assets”, Atento Brasil, S.A. has made payments in escrow related to legal claims with ex-employees and the Brazilian social security authority (Instituto Nacional do Seguro Social) amounting to 48,770 thousands U.S. dollar and 48,690 thousands U.S. dollar at December 31, 2012 and 2013, respectively.
“Provisions for taxes” mainly relates to probable contingencies in Brazil in respect of social security payments, which could be subject to varying interpretations by the social security authorities concerned.
The amount recognized under “Provision for dismantling” corresponds to the necessary cost of covering the dismantling process of the installations held under operating leases for those entities contractually required to do so.
Given the nature of the risks covered by these provisions, it is not possible to determine a reliable schedule of potential payments, if any.
At December 31, 2013, lawsuits still before the courts were as follows:
At December 31, 2013, Atento Brasil was involved in approximately 8,610 labor-related disputes, filed by Atento’s employees or ex-employees for various reasons, such as dismissal or differences over employment conditions in general. The total amount of these claims was 110,089 thousand U.S. dollars, of which 71,883 thousand U.S. dollars are classified by the Company’s internal and external lawyers as probable, 34,606 thousand U.S. dollars are classified as possible, and 3,600 thousand U.S. dollars are classified as remote. In connection with the Acquisition and following IFRS 3 the provision was increased by 69,657 thousand U.S. dollars to reflect not only claims classified as probable based on Company’s internal and external lawyers assessment but also the fair value of possible and remote claims at the Acquisition date based on the probability of loss evaluated on the basis of the statistical history of similar claims (contingent liabilities). In 2013 an additional provision of 11,114 thousand U.S. dollars was made. The Company’s directors and legal advisors consider that these amounts are sufficient to cover the probable risk of an outflow of funds in respect of the disputes.
Moreover, Atento Brasil, S.A. has 17 civil lawsuits ongoing for various reasons (20 in 2012). The total amount of these claims is approximately 1,061 thousand U.S. dollars (7,002 thousand U.S. dollars at December 31, 2012). According to the Company’s external attorneys, materialization of the risk event is possible.
 
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In addition, at December 31, 2013 Atento Brasil, S.A. has 33 contentious proceedings ongoing with the tax authorities and social security authorities, for various reasons relating to infraction proceedings filed (28 in 2012). The total amount of these claims is approximately 47,532 thousand U.S. dollars (39,127 thousand U.S. dollars at December 31, 2012). According to the Company’s external attorneys, materialization of the risk event is possible.
Lastly, there are other contingencies which are classified as possible by the Company amounting to 8,535 thousand U.S. dollars.
At December 31, 2013 Teleatento del Perú, S.A.C. has a lawsuit underway with the Peruvian tax authorities in the amount of 9,473 thousand U.S. dollars (9,946 thousand U.S. dollars in 2012). According to the Company’s external attorneys, materialization of the risk event is possible.
At December 31, 2013 Atento Teleservicios España S.A.U. was party to labor-related disputes filed by Atento employees or former employees for different reasons, such as dismissals and disagreements regarding employment conditions, totaling 2,251 thousand U.S. dollars (2,272 thousand U.S. dollars in 2012). According to the Company’s external lawyers, materialization of the risk event is possible.
At December 31, 2013 Atento México S.A. de C.V. was party to labor-related disputes filed by Atento employees or former employees for different reasons, such as dismissals and disagreements regarding employment conditions, totaling 4,823 thousand U.S. dollars (4,264 thousand U.S. dollars in 2012). According to the Company’s external lawyers, materialization of the risk event is possible.
22) REVENUE AND EXPENSE
a) Revenue
The breakdown of revenue at the Atento Group for the one-month period ended December 31, 2012 and the year ended December 31, 2013 is as follows:

 	  	Thousands of U.S. dollars	 	
 	  	2012	 	  	2013	 	
Revenue	  				  				
Services rendered	  	 	190,875	  	  	 	2,341,115	  	
	  	 	 	 	  	 	 	 	
Total	  	 	190,875	  	  	 	2,341,115	  	
	  	 	 	 	  	 	 	 	
b) Other operating income
Details of other operating income recognized in the consolidated income statement for the one-month period ended December 31, 2012 and the year ended December 31, 2013 are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	2012	 	  	2013	 	
Other operating income	  				  				
Other operating income	  	 	920	  	  	 	2,587	  	
Operating grants	  	 	809	  	  	 	1,698	  	
Income for indemnities and other non-recurring income	  	 	55	  	  	 	57	  	
Gains on disposal of non-current assets	  	 	30	  	  	 	25	  	
	  	 	 	 	  	 	 	 	
Total	  	 	1,814	  	  	 	4,367	  	

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c) Supplies
Details of amounts recognized under “Supplies” during the one-month period ended December 31, 2012 and the year ended December 31, 2013 are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	    2012    	 	  	    2013    	 	
Other supplies	  				  				
Subcontracted services	  	 	2,257	  	  	 	13,094	  	
Infrastructure leases (Note 10)	  	 	351	  	  	 	2,279	  	
Purchase of materials	  	 	229	  	  	 	570	  	
Communications	  	 	955	  	  	 	65,520	  	
Other	  	 	4,575	  	  	 	33,877	  	
	  	 	 	 	  	 	 	 	
Total	  	 	8,367	  	  	 	115,340	  	
	  	 	 	 	  	 	 	 	
d) Employee benefit expense
Details of amounts recognized under “Employee benefit expense” during the one-month period ended December 31, 2012 and the year ended December 31, 2013 are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	    2012    	 	  	    2013    	 	
Employee benefit expense	  				  				
Salaries and wages	  	 	86,423	  	  	 	1,297,424	  	
Social security	  	 	11,448	  	  	 	159,109	  	
Supplementary pension contributions	  	 	336	  	  	 	705	  	
Termination benefits	  	 	2,850	  	  	 	80,824	  	
Other welfare costs	  	 	25,650	  	  	 	105,435	  	
	  	 	 	 	  	 	 	 	
Total	  	 	126,707	  	  	 	1,643,497	  	
	  	 	 	 	  	 	 	 	
The average headcount in the Atento Group in 2012 and 2013 and the breakdown by countries are as follows:

 	  	Average headcount	 	
 	  	2012	 	  	2013	 	
Brazil	  	 	84,031	  	  	 	86,414	  	
Central America	  	 	3,758	  	  	 	4,051	  	
Chile	  	 	4,056	  	  	 	3,883	  	
Colombia	  	 	4,895	  	  	 	5,400	  	
Spain	  	 	14,585	  	  	 	13,904	  	
Morocco	  	 	2,032	  	  	 	1,544	  	
Mexico	  	 	18,861	  	  	 	18,823	  	
Peru	  	 	10,109	  	  	 	10,561	  	
Puerto Rico	  	 	797	  	  	 	763	  	
United States	  	 	377	  	  	 	405	  	
Czech Republic	  	 	791	  	  	 	933	  	
Argentina and Uruguay	  	 	9,346	  	  	 	9,151	  	
	  	 	 	 	  	 	 	 	
Total	  	 	153,638	  	  	 	155,832	  	

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e) Depreciation and amortization
The depreciation and amortization charges recognized in the consolidated income statements for the one-month period ended December 31, 2012 and the year ended December 31, 2013 are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	    2012    	 	  	    2013    	 	
Intangible assets (Note 6)	  	 	2,428	  	  	 	70,680	  	
Property, plant and equipment (Note 9)	  	 	5,072	  	  	 	58,295	  	
	  	 	 	 	  	 	 	 	
Total	  	 	7,500	  	  	 	128,975	  	
	  	 	 	 	  	 	 	 	
f) Other operating expenses
The breakdown of “Other operating expenses” in the consolidated income statements for the the one-month period ended December 31, 2012 and the year ended December 31, 2013 are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	    2012    	 	 	    2013    	 	
Other operating expenses	  				 				
External services provided by other companies	  	 	89,932	  	 	 	339,817	  	
Losses on disposal of fixed assets	  	 	(324	) 	 	 	1,160	  	
Taxes other than income tax	  	 	—	  	 	 	14,497	  	
Other ordinary management expenses	  	 	5,743	  	 	 	196	  	
	  	 	 	 	 	 	 	 	
Total	  	 	95,351	  	 	 	355,670	  	
	  	 	 	 	 	 	 	 	
Details of “External services provided by other companies” under “Other operating expenses” are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	    2012    	 	  	    2013    	 	
External services provided by other companies	  				  				
Leases (Note 10)	  	 	11,231	  	  	 	118,335	  	
Installation and maintenance	  	 	4,791	  	  	 	44,688	  	
Lawyers and law firms	  	 	2,055	  	  	 	12,264	  	
Tax advisory services	  	 	263	  	  	 	329	  	
Consultants	  	 	11,780	  	  	 	36,255	  	
Audits and other related services	  	 	4,106	  	  	 	2,740	  	
Studies and work performed	  	 	106	  	  	 	1,497	  	
Other external professional services	  	 	43,878	  	  	 	45,044	  	
Publicity, advertising and public relations	  	 	299	  	  	 	7,753	  	
Insurance premiums	  	 	175	  	  	 	1,998	  	
Travel expenses	  	 	1,539	  	  	 	13,984	  	
Utilities	  	 	3,548	  	  	 	35,627	  	
Banking and similar services	  	 	352	  	  	 	625	  	
Other	  	 	5,809	  	  	 	18,678	  	
	  	 	 	 	  	 	 	 	
TOTAL	  	 	89,932	  	  	 	339,817	  	
	  	 	 	 	  	 	 	 	
The amounts recognized under “Consultants” and “Other external professional services” in the one-month period ended December 31, 2012 and the year ended December 31, 2013 primarily relate to expenses incurred on the acquisition of the Atento Group from Telefónica, S.A. and other integration related costs.
 
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g) Finance income and costs
The breakdown of “Finance income” and “Finance cost” in the consolidated income statement for the one-month period ended December 31, 2012, and the year ended December 31, 2013 is as follows:

 	  	Thousands of U.S. dollars	 	
 	  	    2012    	 	 	    2013    	 	
Finance income	  				 				
Interest received from third parties	  	 	2,595	  	 	 	10,832	  	
Gains in the fair value of financial instruments	  	 	—	  	 	 	6,934	  	
Gains on the disposal of financial assets	  	 	—	  	 	 	27	  	
	  	 	 	 	 	 	 	 	
Total finance income	  	 	2,595	  	 	 	17,793	  	
	  	 	 	 	 	 	 	 	
Finance cost	  				 				
Interest paid to Group companies (Note 26)	  	 	(1,934	) 	 	 	(25,652	) 	
Interest paid to third parties	  	 	(6,728	) 	 	 	(90,820	) 	
Discount to present value of provisions and other liabilities	  	 	(1	) 	 	 	(1,215	) 	
Losses on the disposal of financial assets	  	 	—	  	 	 	(161	) 	
Loss in the fair value of financial instruments	  	 	—	  	 	 	(17,226	) 	
	  	 	 	 	 	 	 	 	
Total finance cost	  	 	(8,663	) 	 	 	(135,074	) 	
	  	 	 	 	 	 	 	 	
The breakdown of “Foreign Exchange gains” and “Foreign Exchange losses” is shown in the table below:

Thousands of U.S. dollars	  	2012	 	
	  	Exchange gains	 	  	Exchange losses	 	 	Net	 	
Foreign Exchange gains/(losses)	  				  				 				
Loans and receivables	  	 	19	  	  	 	(940	) 	 				
Other financial transactions	  	 	2,926	  	  	 	(2,892	) 	 				
Current transactions	  	 	2,303	  	  	 	(1,392	) 	 				
	  	 	 	 	  	 	 	 	 	 	 	 	
Total	  	 	5,248	  	  	 	(5,224	) 	 	 	24	  	

													
Thousands of U.S. dollars	  	2013	 	
	  	Exchange gains	 	  	Exchange losses	 	 	Net	 	
Foreign Exchange gains/(losses)	  				  				 				
Loans and receivables	  	 	23,781	  	  	 	(10,842	) 	 				
Other financial transactions	  	 	1,329	  	  	 	(519	) 	 				
Current transactions	  	 	24,982	  	  	 	(22,117	) 	 				
	  	 	 	 	  	 	 	 	 	 	 	 	
Total	  	 	50,092	  	  	 	(33,478	) 	 	 	16,614	  	
	  	 	 	 	  	 	 	 	 	 	 	 	
23) FINANCIAL INFORMATION BY SEGMENTS
The CEO is the chief operating decision maker (“CODM”). Management has determined operational segments on the basis of the information reviewed by the CEO for the purposes of allocating resources and appraising performances. The results measurement used by the CEO to appraise the performance of the Atento Group’s segments is earnings before interest, taxes and depreciation and amortization (“EBITDA”) and Adjusted EBITDA (as defined below).
The CEO considers business from the geographic perspective in the following areas:
 
 	•	 	EMEA, which combines the activities carried out regionally in Spain, Morocco and the Czech Republic.	
 
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 	•	 	The Americas, which includes the activities carried out by the various Spanish-speaking companies in Mexico, Central and South America. It also includes transactions in the United States.	
 
 	•	 	Brazil, which is managed separately in view of its different language and importance.	
Inter-segment transactions are carried out at market prices.
The Atento Group uses EBITDA and Adjusted EBITDA to track the performance of its segments and to establish operating and strategic targets. Management believes that EBITDA and Adjusted EBITDA provides an important measure of the segment’s operating performance because it allows management to evaluate and compare the segments’ operating results, including their return on capital and operating efficiencies, from period to period by removing the impact of their capital structure (interest expenses), asset bases (depreciation and amortization), and tax consequences. Adjusted EBITDA is defined as EBITDA adjusted to exclude acquisition and integration costs, restructuring costs, sponsor management fees, asset impairments, site relocation costs, financing fees and other items which are not related to our core operating results.
EBITDA and Adjusted EBITDA are a commonly reported measure and is widely used among analysts, investors and other interested parties in the Atento Group’s industry, although not a measure explicitly defined in IFRS, and therefore, may not be comparable to similar indicators used by other companies. EBITDA and Adjusted EBITDA should not be considered as an alternative to profit for the year as a measurement of our consolidated earnings or as an alternative to consolidated cash flows from operating activities as a measurement of our liquidity.
The major data for these segments in the one-month period ended December 31, 2012 were as follows:

 	  	EMEA	 	 	Americas	 	 	Brazil	 	 	Other and
eliminations	 	 	Total
Group	 	
Sales to other companies	  	 	8,809	  	 	 	31,540	  	 	 	57,411	  	 	 	—  	  	 	 	97,760	  	
Sales to Telefónica Group customers	  	 	21,792	  	 	 	32,476	  	 	 	38,847	  	 	 	—  	  	 	 	93,115	  	
Intragroup sales	  	 	73	  	 	 	60	  	 	 	—  	  	 	 	(133	) 	 	 	—  	  	
Other operating income and expense	  	 	(26,235	) 	 	 	(49,584	) 	 	 	(80,541	) 	 	 	(69,459	) 	 	 	(225,819	) 	
EBITDA	  	 	4,439	  	 	 	14,492	  	 	 	15,717	  	 	 	(69,592	) 	 	 	(34,944	) 	
Depreciation and amortization	  	 	(1,287	) 	 	 	(2,750	) 	 	 	(3,375	) 	 	 	(88	) 	 	 	(7,500	) 	
Operating income	  	 	3,152	  	 	 	11,742	  	 	 	12,342	  	 	 	(69,680	) 	 	 	(42,444	) 	
Financial results	  	 	(818	) 	 	 	(2,660	) 	 	 	(2,564	) 	 	 	(2	) 	 	 	(6,044	) 	
Income tax	  	 	(645	) 	 	 	(241	) 	 	 	27,478	  	 	 	(34,724	) 	 	 	(8,132	) 	
Profit/(loss) for the period	  	 	1,689	  	 	 	8,841	  	 	 	37,256	  	 	 	(104,406	) 	 	 	(56,620	) 	
EBITDA	  	 	4,439	  	 	 	14,492	  	 	 	15,717	  	 	 	(69,592	) 	 	 	(34,944	) 	
Acquisition and integration costs	  	 	—  	  	 	 	—  	  	 	 	—  	  	 	 	62,395	  	 	 	62,395	  	
Restructuring costs	  	 	—  	  	 	 	4,661	  	 	 	—  	  	 	 	—  	  	 	 	4,661	  	
Site relocation costs	  	 	—  	  	 	 	—  	  	 	 	709	  	 	 	—  	  	 	 	709	  	
Other	  	 	(578	) 	 	 	—  	  	 	 	—  	  	 	 	(10	) 	 	 	(588	) 	
Adjusted EBITDA	  	 	3,861	  	 	 	19,153	  	 	 	16,426	  	 	 	(7,207	) 	 	 	32,233	  	
Capital expenditure	  	 	3,954	  	 	 	12,318	  	 	 	10,288	  	 	 	1,811	  	 	 	28,371	  	
Fixed assets	  	 	148,657	  	 	 	353,323	  	 	 	426,846	  	 	 	4,007	  	 	 	932,833	  	
Allocated assets	  	 	542,536	  	 	 	733,245	  	 	 	918,481	  	 	 	(233,300	) 	 	 	1,960,962	  	
Allocated liabilities	  	 	362,123	  	 	 	436,595	  	 	 	793,503	  	 	 	401,454	  	 	 	1,993,675	  	
 
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The major data for these segments in the year ended December 31, 2013 were as follows:

 	  	EMEA	 	 	Americas	 	 	Brazil	 	 	Other and
eliminations	 	 	Total Group	 	
Sales to other companies	  	 	119,515	  	 	 	401,979	  	 	 	683,110	  	 	 	—	  	 	 	1,204,604	  	
Sales to Telefónica Group customers	  	 	243,264	  	 	 	370,225	  	 	 	523,022	  	 	 	—	  	 	 	1,136,511	  	
Intragroup sales	  	 	278	  	 	 	499	  	 	 	—	  	 	 	(777	) 	 	 	—	  	
Other operating income and expense	  	 	(338,802	) 	 	 	(657,436	) 	 	 	(1,055,441	) 	 	 	(55,487	) 	 	 	(2,107,166	) 	
EBITDA	  	 	24,255	  	 	 	115,267	  	 	 	150,691	  	 	 	(56,264	) 	 	 	233,949	  	
Depreciation and amortization	  	 	(24,398	) 	 	 	(47,695	) 	 	 	(55,886	) 	 	 	(996	) 	 	 	(128,975	) 	
Operating income	  	 	(143	) 	 	 	67,572	  	 	 	94,805	  	 	 	(57,260	) 	 	 	104,974	  	
Financial results	  	 	(18,358	) 	 	 	(3,891	) 	 	 	(43,913	) 	 	 	(34,505	) 	 	 	(100,667	) 	
Income tax	  	 	7,770	  	 	 	(19,305	) 	 	 	(17,710	) 	 	 	20,899	  	 	 	(8,346	) 	
Profit/(loss) for the year	  	 	(10,731	) 	 	 	44,376	  	 	 	33,182	  	 	 	(70,866	) 	 	 	(4,039	) 	
						
EBITDA	  	 	24,255	  	 	 	115,267	  	 	 	150,691	  	 	 	(56,264	) 	 	 	233,949	  	
Acquisition and integration costs	  	 	585	  	 	 	618	  	 	 	5,992	  	 	 	22,068	  	 	 	29,263	  	
Restructuring costs	  	 	1,890	  	 	 	2,506	  	 	 	—	  	 	 	8,453	  	 	 	12,849	  	
Sponsor management fees	  	 	—	  	 	 	—	  	 	 	—	  	 	 	9,130	  	 	 	9,130	  	
Site relocation costs	  	 	—	  	 	 	—	  	 	 	1,845	  	 	 	—	  	 	 	1,845	  	
Financing fees	  	 	—	  	 	 	—	  	 	 	561	  	 	 	5,543	  	 	 	6,104	  	
Other	  	 	—	  	 	 	—	  	 	 	2,005	  	 	 	—	  	 	 	2,005	  	
Adjusted EBITDA	  	 	26,730	  	 	 	118,391	  	 	 	161,094	  	 	 	(11,070	) 	 	 	295,145	  	
						
Capital expenditure	  	 	7,180	  	 	 	31,812	  	 	 	63,241	  	 	 	796	  	 	 	103,029	  	
Fixed assets	  	 	136,916	  	 	 	303,329	  	 	 	377,933	  	 	 	3,941	  	 	 	822,119	  	
Allocated assets	  	 	535,645	  	 	 	694,391	  	 	 	853,018	  	 	 	(240,874)	  	 	 	1,842,180	  	
Allocated liabilities	  	 	361,576	  	 	 	398,067	  	 	 	661,039	  	 	 	555,464	  	 	 	1,976,146	  	
“Other and eliminations” includes activities of the following intermediate holdings in Spain: Atento Spain Holdco, S.L.U., Atento Spain Holdco 6, S.L.U. and Global Rossolimo, S.L.U., as well as inter-group transactions between segments.
The breakdown of sales to non-Group customers by the main countries where the Atento Group operates is as follows:

 	  	Thousands of U.S. dollars	 	
Country	  	2012	 	  	2013	 	
Spain	  	 	27,515	  	  	 	327,351	  	
Morocco	  	 	2,099	  	  	 	20,863	  	
Czech Republic	  	 	999	  	  	 	14,565	  	
	  	 	 	 	  	 	 	 	
EMEA	  	 	30,613	  	  	 	362,779	  	
	  	 	 	 	  	 	 	 	
Argentina	  	 	19,211	  	  	 	198,710	  	
Chile	  	 	4,897	  	  	 	68,454	  	
Colombia	  	 	5,015	  	  	 	65,738	  	
El Salvador	  	 	1,266	  	  	 	12,753	  	
United States	  	 	1,416	  	  	 	20,142	  	
Guatemala	  	 	1,073	  	  	 	14,405	  	
Mexico	  	 	20,749	  	  	 	265,198	  	
Peru	  	 	8,301	  	  	 	102,168	  	
Puerto Rico	  	 	1,350	  	  	 	14,898	  	
Uruguay	  	 	716	  	  	 	9,565	  	
Panama	  	 	10	  	  	 	173	  	
	  	 	 	 	  	 	 	 	
Americas	  	 	64,004	  	  	 	772,204	  	
	  	 	 	 	  	 	 	 	
Brazil	  	 	96,258	  	  	 	1,206,132	  	
Total sales to non-Group customers	  	 	190,875	  	  	 	2,341,115	  	

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As stated in Note 5, the Atento Group signed a framework contract with Telefónica that expires in December 31, 2021. In 2013, approximately 48.5% of service revenues were generated from business with Telefónica Group companies (48.8% in 2012).
As stated in Note 9, property, plant and equipment located outside Spain total 208,226 thousand U.S. dollars (197,131 thousand U.S. dollars at December 31, 2012) and are primarily on site in Mexico and Brazil, totaling 24,934 thousand U.S. dollars and 137,161 thousand U.S. dollars respectively at December 31, 2013 (23,633 thousand U.S. dollars and 130,069 thousand U.S. dollars respectively at December 31, 2012).
24) RESULTS PER SHARE
Basic results per share are calculated by dividing the profits attributable to equity holders of the Company by the weighted average number of ordinary shares outstanding during the periods.

 	  	2012	 	 	2013	 	
Result attributable to equity holders of the Company	  				 				
Net loss for the period/year (thousands of U.S. dollars)	  	 	(56,620	) 	 	 	(4,039	) 	
Weighted average number of ordinary shares	  	 	2,000,000	  	 	 	2,000,000	  	
	  	 	 	 	 	 	 	 	
Results per share (U.S. dollar)	  	 	(28.31	) 	 	 	(2.02	) 	
	  	 	 	 	 	 	 	 	
Diluted results per share are calculated by adjusting the weighted average number of ordinary shares outstanding to reflect the hypothetical conversion of all potentially dilutive ordinary shares. The Company has no potentially dilutive ordinary shares, and thus there is no difference between basic results per share and diluted results per share.
25) COMMITMENTS
a) Guarantees and commitments
At December 31, 2012 and 2013 the Atento Group had issued various guarantees and commitments to third parties amounting to 150,835 thousand U.S. dollars and 233,413 thousand U.S. dollars respectively.
The transactions guaranteed and their respective amounts at December 31, 2012 and 2013 are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	12/31/2012	 	  	12/31/2013	 	
Guarantees	  				  				
Financial, labor-related, tax and rental transactions	  	 	94,824	  	  	 	97,431	  	
Contractual obligations	  	 	55,968	  	  	 	135,830	  	
Other	  	 	43	  	  	 	152	  	
	  	 	 	 	  	 	 	 	
Total	  	 	150,835	  	  	 	233,413	  	
	  	 	 	 	  	 	 	 	
The Company’s directors consider that no liabilities will arise from these guarantees in addition to those already recognized.
The breakdown shown in the table above relates to guarantees extended by Atento Group companies, classified by their purpose. Of these guarantees, the majority relate to commercial purposes and rental activities, the bulk of the remaining guarantees relates to tax and labor-related procedures.
b) Other financial commitments
As described in Note 17, on November 22, 2012 BC Brazilco Participações, S.A. (now merged with Atento Brasil, S.A.) issued debentures in Brazil, subscribed by institutional investors and assumed by Bain. This long-term financial commitment matures in 2019.
 
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In addition, on December 26, 2012 a trust agreement was signed between Atento Brasil, S.A. BC Brazilco Participações, S.A. and Banco BTG Pactual, S/A (as the depository bank) in order to guarantee this debenture issue.
As a result of the bonds issue by Atento Luxco 1, S.A. (formerly BC Luxco 1, S.A.) and the arrangement of the Super Senior Revolving Credit Facilities Agreement described in Note 17, in April and May 2013 the following financial documents adherence and guarantee agreements were signed, inter alia:
1. Adherence to financial documents by Atento Atención y Servicios S.A. de C.V., Atento Impulsa, S.A.U., Atento Servicios Técnicos y Consultoría, S.A.U., Atento Servicios Auxiliares de Contact Center S.A.U., Atento Colombia S.A., Teleatento del Perú S.A.C., and Atento Holding Chile, S.A. as Post Closing Guarantors.
2. Pledge of shares in Atento Group companies guaranteeing the financial loans, including Atento Mexicana, S.A. de C.V., Atento Servicios, S.A. de C.V. and Atento Teleservicios España, S.A.U. as “Initial Guarantors”, as well as Atento Atención y Servicios S.A. de C.V., Atento Impulsa, S.L.U., Atento Servicios Técnicos y Consultoría, S.L.U., Atento Servicios Auxiliares de Contact Center, S.L.U., Atento Colombia S.A., Teleatento del Peru S.A.C. and Atento Holding Chile, S.A. as “Post-Closing Guarantors”.
3. Pledge on the current accounts of Atento Teleservicios España, S.A.U., Atento Servicios Técnicos y Consultoría, S.A.U., Atento Impulsa, S.A.U., and Atento Servicios Auxiliares de Contact Center, S.A.U. Current accounts of these subsidiaries amount to 24,409 thousand U.S. dollars at December 31, 2013.
Lastly, on April 29, 2013 Atento Mexico Holdco S.R.L. de C.V. and Atento Mexicana S.A. de C.V. entered into a trust agreement with CITIBANK N.A. London as bond underwriter for the loan contract, and as bond coverage guarantor.
c) Operating leases
The breakdown of total minimum future lease payments under non-cancellable operating leases is as follows:

 	  	Thousands of U.S. dollars	 	
 	  	    2012    	 	  	    2013    	 	
Up to 1 year	  	 	99,149	  	  	 	90,930	  	
Between 1 and 5 years	  	 	166,288	  	  	 	170,692	  	
More than 5 years	  	 	41,060	  	  	 	33,116	  	
	  	 	 	 	  	 	 	 	
Total	  	 	306,497	  	  	 	294,738	  	
	  	 	 	 	  	 	 	 	
Total operating lease expenses recognized in the consolidated income statement for the year ended December 31, 2013 amount to 2,279 thousand U.S. dollars (351 thousand U.S. dollars in 2012) under “Infrastructure leases” (see Note 22 c) and 118,335 thousand U.S. dollars (11,231 thousand U.S. dollars in 2012) under “External services provided by other companies” (see Note 22 f).
No contingent payments on operating leases were recognized in the consolidated income statements for the one-month period ended December 31, 2012 and the year ended December 31, 2013.
The operating leases where Atento Group acts as lessee are mainly on premises used as call centers. These leases have various termination dates, with the latest in 2023.
At December 31, 2013 the payment commitment for the early cancellation of these leases amounts to 147,914 thousand U.S. dollars (185,394 thousand U.S. dollars in 2012).
 
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26) RELATED PARTIES
Directors
The directors of the Company at the date on which the financial statements were prepared are Melissa Bethell, Aibhe Jennings, Aurelien Vasseur and Jay Corrigan.
The directors currently serving on the Board of the Company received no remuneration whatsoever for their functions as directors in 2013.
Key management personnel
Key management personnel include those persons empowered and responsible for planning, directing and controlling the Atento Group’s activities, either directly or indirectly.
Key management personnel with executive duties in the Atento Group in 2012 and 2013 are as follows:
2012

Name	  	Post	
Alejandro Reynal Ample	  	Chief Executive Officer	
Mª Reyes Cerezo Rodriguez Sedano	  	Chief Legal and Compliance Officer	
José Ignacio Cebollero Bueno	  	Director of Human Resources	
Miguel Matey Marañón	  	Regional Director—North America	
Juan Enrique Gamé	  	Regional Director—South America	
Nelson Armbrust	  	Regional Director—Brazil	
Diego López San Román	  	Director of Sales and Business Development	
Mariano Castaños Zemborain	  	Regional Director—EMEA	
2013

Name	  	Post	
Alejandro Reynal Ample	  	Chief Executive Officer	
Mª Reyes Cerezo Rodriguez Sedano	  	Chief Legal and Compliance Officer	
Diego Lopez San Román*	  	Director of Business Development	
Juan Enrique Gamé	  	Regional Director—South America	
Mariano Castaños Zemborain	  	Regional Director—EMEA	
Nelson Armbrust	  	Regional Director—Brazil	
Miguel Matey Marañón	  	Regional Director—North America and Mexico	
Mauricio Montilha Teles	  	Chief Financial Officer	
José Ignacio Cebollero Bueno	  	Director of Human Resources	
John Robson	  	Director of Global Technology	

(*)	Until December 15, 2013.	
The following table shows the total remuneration paid to the Atento Group’s key management personnel in 2012 and 2013:

 	  	Thousands of U.S. dollars	 	
	  	    2012(*)    	 	  	    2013    	 	
Total remuneration paid to key management personnel	  	 	374	  	  	 	8,303	  	

(*)	As described in Note 1, 2012 is not a complete year	
 
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The breakdown of the remuneration shown above is as follows:

 	  	Thousands of U.S. dollars	 	
	  	12/31/2013	 	
Salaries and variable remuneration	  	 	7,896	  	
Salaries	  	 	3,401	  	
Variable remuneration	  	 	1,365	  	
Other remuneration related to Management Incentive Program	  	 	3,130	  	
Payment in kind	  	 	407	  	
Medical insurance	  	 	70	  	
Life insurance premiums	  	 	17	  	
Other	  	 	320	  	
	  	 	 	 	
Total	  	 	8,303	  	
	  	 	 	 	
In July 2013, the Shareholders of Atento Group implemented a Management Incentive Plan (the “MIP”) pursuant to which certain of the Group’s senior management are granted the opportunity to invest in the Group. The eligibility of managers to participate is determined by the remuneration committee of the company.
Managers who participate in the MIP are required to subscribe for various classes of shares in a Luxembourg special purpose vehicle that is indirectly invested in Atalaya Luxco Topco S.C.A (“Topco”), the ultimate parent company of the Group. The shares held by each MIP participant fall into two categories: ‘co-investment shares’ and ‘performance shares’.
The co-investment shares effectively allow managers to participate in dividends and other distributions on a pro rata and pari passu basis with Topco’s other shareholders. The performance shares only participate in dividends and other distributions if Topco’s majority shareholder achieves certain specified returns on its investment in Topco, with the performance shares being entitled to receive a progressively larger share of all dividends and other distributions (up to a pre-determined maximum percentage) as the total proceeds received by Topco’s majority shareholder reach certain pre-agreed hurdles.
MIP participants are only entitled to hold shares for so long as they are employed by a member of the Group. In the event that a MIP participant’s employment is terminated, his/her shares can be bought back at a pre-specified price that is linked to the circumstances surrounding the termination of the relevant manager’s employment and the length of time that such manager has held his/her shares.
In connection with the MIP, the participants were granted with an amount in cash exclusively with the objective of acquiring the shares described above which has been accounted for as a compensation expense in 2013. The Board of Directors does not expect in the future any significant impact in the financial statements as a consequence of this Program.
In addition to the amounts disclosed above, in 2013 a total of 1,430 thousand U.S. dollars was paid to key management personnel as severance payment.
On July 18, 2013, Atento Spain Holdco 2, S.A.U., an indirect subsidiary, entered into a revolving facility agreement with Atalaya Management Luxco Investment pursuant to which Atento Spain Holdco 2, S.A.U. provided a Euro revolving loan facility in an aggregate amount equal to €3.0 million (4.1 million U.S. dollars) to Atalaya Management Luxco Investment for the purpose of acquiring an immaterial ownership interest in a related party. As of December 31, 2013, the management loan had an outstanding balance of 2,423 thousand U.S. dollars which is included in other non-current receivables (See Note 12) on the statement of financial position. The loan accrues interest at a rate of 6% per annum, matures on July 18, 2023 and was capitalized in full in April 2014.
 
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Balances and transactions with the Sole Shareholder and other related parties
The table below sets out balances and transactions with ATALAYA Luxco TOPCO, S.C.A, in 2012 and 2013 (in thousand U.S. dollars):

 	  	12/31/2012	 	  	12/31/2013	 	
Non-current payables to Group companies	  	 	471,624	  	  	 	519,607	  	
Atalaya Luxco Topco, S.C.A.	  	 	471,624	  	  	 	519,607	  	
			
Current payables to Group companies	  	 	38	  	  	 	—	  	
Atalaya Luxco Topco, S.C.A.	  	 	38	  	  	 	—	  	
Atalaya Luxco Topco, S.C.A payables are composed of the following: (i) three series of Preferred Equity Certificates (PECs, ALPECs and PPPECs) issued by the Atalaya Luxco Topco Company and subscribed by the Company, totaling 517.4 million U.S. dollars at December 31, 2013 (469.7 million U.S. dollars in 2012); (ii) interest accruing pending payment in the amount of 2.2 million U.S. dollars at December 31, 2013 (1.9 million U.S. dollars in 2012).
The outlay for interest on these debts in 2013 was 25.7 million U.S. dollars (1.9 million U.S. dollars in 2012).
Preferred Equity Certificates
On December 3, 2012 the Company authorized issuance of the following Preferred Equity Certificates (PECs):
 
 	•	 	Series 1: 50,000,000,000 PECs with a par value of 0.01 euro each. These PECs mature after 30 years, but may be withdrawn prior to this date in certain scenarios, and accrue interest of 8.0309%. At December 31, 2012 and 2013 the Company had issued 23,580,000,000 Series 1 PECs for an aggregate amount of 311,114 and 325,192 thousand U.S. dollars, respectively. The interest capitalized in 2013 totaled 26,100 thousand U.S. dollars (equivalent to 26,479 thousand U.S. dollars at December 31, 2013). The interest accruing at December 31, 2013 totaled 2,197 thousand U.S. dollars.	
 
 	•	 	Series 2: 200,000 PECs with a par value of 0.01 euro each. These PECs mature after 30 years, but may be withdrawn prior to this in certain scenarios.	
The yield equals to the profit recognized for Luxembourg generally accepted accounting practice in connection with the “Specified Assets” (meaning the investment of the Company in the Luxco 1 Series 2 PECs, as defined in the terms and conditions of the Series 2 PECs) and not previously taken into account, less any loss recognized for Luxembourg generally accepted accounting practice in connection with the Specified Assets for a previous “Accrual Period” (as defined in the terms and conditions of the Series 2 PECs), less a proportional amount of any direct expense (including overhead expenses) borne by the Company during the Accrual Period in relation to the Specified Assets and less the losses of the Company in relation to the Specified Assets during the Accrual Period, including any such losses carried forward from previous Accrual Periods, such amount then divided by the number of Series 2 PECs in issue at any time in that period.
At December 31, 2012 and 2013 the Company had issued 200,000 Series 2 PECs for an aggregate amount of 3 thousand U.S. dollar.
 
 	•	 	Series 3: 25,000,000,000 PECs with a par value of 0.01 euro each. These PECs mature after 60 years, but may be withdrawn prior to this in certain scenarios. The yield equals to the “Specified Income” (meaning the sum of all income and capital gains derived by the Company from the Eligible Assets less losses of the Company carried forward less all other expenses of the Company connected to the investment in the Eligible Assets, as defined in the terms and conditions of the Series 3 PECs) for each accounting period comprised in such “Accrual Period” (as defined in the terms and conditions of the Series 3 PECs) divided by 365 (or if a leap year, 366) and, respectively in the case of each such number	
 
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 	so ascertained, multiplied by the number of days of each such accounting period that comprised that Accrual Period, then divided by the number of Series 3 PECs in issue. At December 31, 2013 the Company had issued 12,017,800,000 Series 3 PECs for an aggregate amount of 165,737 thousand U.S. dollars.	
The PECs are classified as subordinated debt with respect to the Company’s other present and future obligations.
The table below provides a summary of PECs and their movements in 2013:

 	  	 	 	  	Thousands of U.S. dollars	 	
PEC	  	Maturity	 	  	12/31/2012	 	  	Interest
capitalized	 	  	Translation
differences	 	  	12/31/2013	 	
Series 1 PECs	  	 	2042	  	  	 	311,114	  	  	 	26,100	  	  	 	14,456	  	  	 	351,670	  	
Series 2 PECs	  	 	2042	  	  	 	3	  	  	 	—	  	  	 	—	  	  	 	3	  	
Series 3 PECs	  	 	2072	  	  	 	158,563	  	  	 	—	  	  	 	7,174	  	  	 	165,737	  	
	  				  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  				  	 	469,680	  	  	 	26,100	  	  	 	21,630	  	  	 	517,410	  	
	  				  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Given the specific features and conditions of these instruments and their recent date of issuance, the PECs’s book value approximates to their fair value, which fair value hierarchy is level 3.
Transactions with Bain Capital
A number of Group companies receive consultancy services and other services from companies related to Bain Capital Partners LLC. The services are provided under market conditions. Transactions with Bain Capital Partners in 2013 amounted to 12,060 thousand U.S. dollars and principally relate to transaction fees in connection with the bond issuance and services provided under the consulting services agreement entered to with the Company (20,255 thousand U.S. dollars in 2012 principally related to transactions fees in connection with the Acquisition.)
27) OTHER INFORMATION
a) Auditors’ fees
The fees paid to the various member firms of the Ernst & Young international organization, of which Ernst & Young, S.L., auditors of the Atento Group in 2012 and 2013, amounted to a 1,320 thousand U.S. dollars and 1,836 thousand U.S. dollars respectively.
Details of these amounts are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	    2012    	 	  	    2013    	 	
Audit fees	  				  				
Audit services	  	 	1,320	  	  	 	1,836	  	
	  	 	 	 	  	 	 	 	
Total	  	 	1,320	  	  	 	1,836	  	
	  	 	 	 	  	 	 	 	
These fees include amounts paid in respect of fully consolidated Atento Group companies.
b) Restricted net assets
Certain of our consolidated subsidiaries are restricted from remitting certain funds to us including paying certain dividends, purchasing or redeeming capital stock, making certain payments on subordinated debt from our current indenture agreements and as a result of a variety of regulations, contractual or statutory requirements.
 
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Our ability to distribute funds is limited by the indenture governing, our Senior Secure Notes, the Brazilian Debentures, the VLN and our CVIs and may be further restricted by the terms of any of our future debt or preferred equity. Restricted payments are generally limited by compliance with leverage ratios, fixed charge coverage ratios and permitted payment baskets. The Company may in the future require additional cash resources from the subsidiaries due to changes in business conditions or merely to declare and pay dividends to make distributions to shareholders.
The separate condensed financial statements of the Company are presented below:
ATALAYA LUXCO MIDCO, S.A.R.L
CONDENSED STATEMENTS OF FINANCIAL POSITION
(In thousands of U.S. Dollars)

 	  	December 31,
2012	 	 	December 31,
2013	 	
ASSETS	  				 				
Investments in affiliates	  	 	2,562	  	 	 	2,562	  	
Loans to affiliates	  	 	616,643	  	 	 	666,062	  	
Other assets	  	 	—	  	 	 	4	  	
Cash and cash equivalents	  	 	278	  	 	 	227	  	
	  	 	 	 	 	 	 	 	
TOTAL ASSETS	  	 	619,483	  	 	 	668,855	  	
	  	 	 	 	 	 	 	 	
LIABILITIES AND EQUITY	  				 				
Borrowings	  	 	616,758	  	 	 	519,607	  	
Other debt	  	 	—	  	 	 	151,701	  	
Accounts payable and other liabilities	  	 	451	  	 	 	523	  	
	  	 	 	 	 	 	 	 	
TOTAL LIABILITIES	  	 	617,209	  	 	 	671,831	  	
	  	 	 	 	 	 	 	 	
Share capital	  	 	2,592	  	 	 	2,592	  	
Retained earnings	  	 	(317	) 	 	 	(5,359	) 	
Translation differences	  	 	4	  	 	 	(204	) 	
Other reserves	  	 	(5	) 	 	 	(5	) 	
	  	 	 	 	 	 	 	 	
TOTAL SHAREHOLDERS EQUITY	  	 	2,274	  	 	 	(2,976	) 	
	  	 	 	 	 	 	 	 	
TOTAL LIABILITIES AND EQUITY	  	 	619,483	  	 	 	668,855	  	
	  	 	 	 	 	 	 	 	
ATALAYA LUXCO MIDCO, S.A.R.L
CONDENSED INCOME STATEMENTS
(In thousands of U.S. Dollars)

 	  	December 1 to
December 31, 2012	 	 	Fort the year
ended
December 31,
2013	 	
Revenue	  	 	—	  	 	 	—	  	
Other operating expenses	  	 	(47	) 	 	 	(104	) 	
Finance income	  	 	2,063	  	 	 	28,021	  	
Finance expense	  	 	(2,330	) 	 	 	(32,954	) 	
Net finance expense	  	 	(267	) 	 	 	(4,933	) 	
	  	 	 	 	 	 	 	 	
(LOSS) BEFORE TAX	  	 	(314	) 	 	 	(5,037	) 	
	  	 	 	 	 	 	 	 	
Income tax expense	  	 	(3	) 	 	 	(5	) 	
	  	 	 	 	 	 	 	 	
LOSS FOR THE PERIOD	  	 	(317	) 	 	 	(5,042	) 	

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ATALAYA LUXCO MIDCO, S.A.R.L
CONDENSED STATEMENTS OF COMPREHENSIVE INCOME
(Thousands of US Dollars)

 	  	December 1 to
December 31, 2012	 	 	For the year
ended
December 31,
2013	 	
Loss for the period/year	  	 	(317	) 	 	 	(5,042	) 	
	  	 	 	 	 	 	 	 	
Other comprehensive income/(loss)	  				 				
Translation differences	  	 	4	  	 	 	(214	) 	
Other	  	 	(5	) 	 	 	—	  	
	  	 	 	 	 	 	 	 	
Other comprehensive income/(loss), net of taxes	  	 	(1	) 	 	 	(214	) 	
	  	 	 	 	 	 	 	 	
Total consolidated comprehensive loss	  	 	(318	) 	 	 	(5,256	) 	
	  	 	 	 	 	 	 	 	
ATALAYA LUXCO MIDCO, S.A.R.L
CONDENSED STATEMENTS OF CASH FLOWS
(In thousands of U.S. Dollars)

 	  	December 1 to
December 31, 2012	 	 	For the year
ended
December 31,
2013	 	
Loss before tax	  	 	(314	) 	 	 	(5,037	) 	
Adjustments to loss:	  				 				
Net finance expense	  	 	267	  	 	 	4,933	  	
Change in accounts receivable	  	 	—	  	 	 	(4	) 	
Change in accounts payable	  	 	451	  	 	 	72	  	
Interest paid	  	 	(2,330	) 	 	 	(32,954	) 	
Interest received	  	 	2,063	  	 	 	28,021	  	
Net cash flows from/(used in) operating activities	  	 	137	  	 	 	(4,970	) 	
Investment in affiliates	  	 	(2,562	) 	 	 	—	  	
Loans to affiliates	  	 	(616,643	) 	 	 	(49,419	) 	
Net cash flows from/(used in) investing activities	  	 	(619,205	) 	 	 	(49,419	) 	
Proceeds from issue of equity instruments	  	 	2,592	  	 	 	—	  	
Proceeds/(payments) from borrowings	  	 	616,758	  	 	 	(97,151	) 	
Proceeds from other debt	  	 	—	  	 	 	151,701	  	
Net cash flows from/(used in) financing activities	  	 	619,350	  	 	 	54,550	  	
Exchange differences	  	 	(4	) 	 	 	(212	) 	
Net increase in cash and cash equivalents	  	 	278	  	 	 	(51	) 	
	  	 	 	 	 	 	 	 	
Cash and cash equivalents at beginning of period	  	 	—	  	 	 	278	  	
	  	 	 	 	 	 	 	 	
Cash and cash equivalents at end of period	  	 	278	  	 	 	227	  	
	  	 	 	 	 	 	 	 	
Certain information and footnote disclosures normally included in financial statements prepared in accordance with International Financial Reporting Standards have been condensed or omitted. The footnote disclosures contain supplemental information only and, as such, these statements should be read in conjunction with the notes to the accompanying consolidated financial statements.
Basis of preparation
The presentation of the Company’s stand-alone condensed financial statement has been prepared using the same accounting policies as set out in the accompanying consolidated financial statements except that, the
 
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Company records its investment in subsidiaries under the cost method of accounting. Such investments are presented on the statements of financial position as ‘‘Investment in affiliates’’ at cost less any identified impairment loss.
As of December 31, 2012 and 2013, there were no material contingencies, significant provisions of long-term obligations, mandatory dividend or redemption requirements of redeemable stocks or guarantees of the Company, except for those which have been separately disclosed in the Consolidated Financial Statements, if any.
Reconciliation (in thousands of U.S. dollar)

IFRS Profit/(loss) reconciliation 	  	December 1 to
December 31,
2012	 	 	For the year
ended
December 31,
2013	 	
Company IFRS profit/(loss) for the period	  	 	(317	) 	 	 	(5,042	) 	
Additional profit/(loss) if subsidiaries had been accounted for using the equity method	  	 	(56,303	) 	 	 	1,003	  	
	  	 	 	 	 	 	 	 	
Consolidated IFRS profit/(loss) for the period	  	 	(56,620	) 	 	 	(4,039	) 	

									
IFRS Equity reconciliation 	  	December 1 to
December 31,
2012	 	 	For the year
ended
December 31,
2013	 	
Parent shareholders’ equity	  	 	2,274	  	 	 	(2,976	) 	
Additional equity if subsidiaries had been accounted for using the equity method	  	 	(34,987	) 	 	 	(130,990	) 	
	  	 	 	 	 	 	 	 	
Consolidated IFRS shareholders’ equity	  	 	(32,713	) 	 	 	(133,966	) 	
	  	 	 	 	 	 	 	 	
28) EVENTS AFTER THE REPORTING PERIOD
The Atento Group has evaluated subsequent events through April 29, 2014, the date these consolidated financial statements were available to be issued and have not identified subsequent events that affect the Atento Group’s consolidated financial statements at December 31, 2013.
At February 3, 2014, Banco Nacional de Desenvolvimento Econômico e Social (BNDES) granted a credit facility to the subsidiary Atento Brasil S.A for BRL 300 million (equivalent to 124 million U.S. dollars). Once the debtor met certain requirements in the signed contract the loan automatically became available for the debtor. On March 27, 2014 and April 16, 2014, BNDES disbursed BRL 56.6 million (24.8 million U.S. dollars) and BRL 23.7 million (10.6 million U.S. dollars) portions respectively of the total facility, accounting for 26.8% of total credit line.
 
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 Report of Independent Registered Public Accounting Firm
The Board of Directors and Sole Shareholder of Atalaya Luxco Midco S.à.r.l.
We have audited the accompanying combined carve-out statements of financial position of Atalaya Luxco Midco Predecessor (the “Predecessor”), as defined in Notes 1 and 2 of the accompanying combined carve-out financial statements, as of December 31, 2011 and November 30, 2012, and the related combined carve-out statements of income, comprehensive income, invested equity, and cash flows for the year ended December 31, 2011 and the eleven-month period ended November 30, 2012. These combined carve-out financial statements are the responsibility of Atalaya Luxco Midco S.à.r.l.’s management. Our responsibility is to express an opinion on these combined carve-out financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the combined carve-out financial statements are free of material misstatement. We were not engaged to perform an audit of the Predecessor’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Predecessor’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the combined carve-out financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the combined carve-out financial statements referred to above present fairly, in all material respects, the combined carve-out financial position of the Predecessor at December 31, 2011 and November 30, 2012, and the combined carve-out results of their operations and their cash flows for the year ended December 31, 2011 and the eleven-month period ended November 30, 2012, in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board.
We draw attention to the fact that, as described in Note 2 (Basis of preparation), the Predecessor has not operated as a separate legal entity. These combined carve-out financial statements are, therefore, not necessarily indicative of results that would have occurred if the Predecessor had been a separate standalone entity during the years presented or of the future results of the Predecessor.
Ernst & Young, S.L.
/s/ Carlos Hidalgo Andres
Carlos Hidalgo Andrés
Madrid, Spain
April 30, 2014
 
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 ATALAYA LUXCO MIDCO PREDECESSOR
COMBINED CARVE-OUT STATEMENTS OF FINANCIAL POSITION
(In thousands of U.S. dollars)

 	  	 	 	As of
January 1,
2011	 	  	As of
December 31,
2011	 	  	As of
November 30,
2012	 	
 	  	Notes	 			  			  			
ASSETS	  		 				  				  				
NON-CURRENT ASSETS	  		 	 	590,216	  	  	 	613,575	  	  	 	587,416	  	
	  		 	 	 	 	  	 	 	 	  	 	 	 	
Intangible assets	  	(Note 6)	 	 	107,533	  	  	 	101,718	  	  	 	82,932	  	
Goodwill	  	(Note 7)	 	 	171,917	  	  	 	189,071	  	  	 	179,322	  	
Property, plant and equipment	  	(Note 8)	 	 	187,137	  	  	 	208,396	  	  	 	209,971	  	
Non-current financial assets	  	(Note 9)	 	 	54,691	  	  	 	51,752	  	  	 	56,367	  	
Deferred tax assets	  	(Note 18)	 	 	68,938	  	  	 	62,638	  	  	 	58,824	  	
CURRENT ASSETS	  		 	 	562,312	  	  	 	611,026	  	  	 	676,355	  	
	  		 	 	 	 	  	 	 	 	  	 	 	 	
Trade and other receivables	  	(Note 10)	 	 	416,812	  	  	 	484,934	  	  	 	546,310	  	
Current income tax receivables	  	(Note 18)	 	 	2,581	  	  	 	7,997	  	  	 	34,557	  	
Current tax receivables	  	(Note 18)	 	 	13,319	  	  	 	11,587	  	  	 	9,630	  	
Current financial assets	  	(Note 9)	 	 	56,520	  	  	 	24,575	  	  	 	36,240	  	
Other assets	  		 	 	3	  	  	 	28	  	  	 	—	  	
Cash and cash equivalents	  	(Note 11)	 	 	73,076	  	  	 	81,905	  	  	 	49,618	  	
TOTAL ASSETS	  		 	 	1,152,527	  	  	 	1,224,601	  	  	 	1,263,771	  	
	  		 	 	 	 	  	 	 	 	  	 	 	 	
EQUITY AND LIABILITIES	  		 				  				  				
INVESTED EQUITY	  		 	 	658,132	  	  	 	631,225	  	  	 	670,067	  	
	  		 	 	 	 	  	 	 	 	  	 	 	 	
Total net parent investment	  	(Note 2)	 	 	644,460	  	  	 	616,667	  	  	 	670,067	  	
Non-controlling interests	  	(Note 16)	 	 	13,672	  	  	 	14,558	  	  	 	—	  	
NON-CURRENT LIABILITIES	  		 	 	55,439	  	  	 	160,233	  	  	 	139,023	  	
	  		 	 	 	 	  	 	 	 	  	 	 	 	
Deferred tax liabilities	  	(Note 18)	 	 	42,528	  	  	 	45,397	  	  	 	39,965	  	
Interest-bearing debt	  	(Note 5,12,13)	 	 	471	  	  	 	102,220	  	  	 	75,426	  	
Non-current provisions	  	(Note 17)	 	 	9,982	  	  	 	12,518	  	  	 	23,555	  	
Other non-trade payables	  	(Note 14)	 	 	2,458	  	  	 	98	  	  	 	77	  	
CURRENT LIABILITIES	  		 	 	438,956	  	  	 	433,143	  	  	 	454,681	  	
	  		 	 	 	 	  	 	 	 	  	 	 	 	
Interest-bearing debt	  	(Note 5,12,13)	 	 	33,932	  	  	 	24,740	  	  	 	13,017	  	
Trade payables	  	(Note 15)	 	 	65,678	  	  	 	103,174	  	  	 	103,826	  	
Income tax payables	  	(Note 18)	 	 	8,563	  	  	 	11,234	  	  	 	47,396	  	
Current tax payables	  	(Note 18)	 	 	97,195	  	  	 	87,998	  	  	 	76,362	  	
Current provisions	  	(Note 17)	 	 	12,922	  	  	 	24,077	  	  	 	29,442	  	
Other non-trade payables	  	(Note 14)	 	 	220,666	  	  	 	181,920	  	  	 	184,638	  	
	  		 	 	 	 	  	 	 	 	  	 	 	 	
TOTAL EQUITY AND LIABILITIES	  		 	 	1,152,527	  	  	 	1,224,601	  	  	 	1,263,771	  	
	  		 	 	 	 	  	 	 	 	  	 	 	 	
The accompanying Notes 1 to 24 are an integral part of these combined carve-out financial statements
 
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 ATALAYA LUXCO MIDCO PREDECESSOR
COMBINED CARVE-OUT INCOME STATEMENTS
(In thousands of U.S. dollars)

 	  	 	 	For the year ended
December 31,	 	 	January 1 to
November 30,	 	
 	  	Notes	 	2011	 	 	2012	 	
Revenue	  	(Note 19a)	 	 	2,417,286	  	 	 	2,125,928	  	
Other operating income	  	(Note 19b)	 	 	7,221	  	 	 	1,857	  	
Supplies	  	(Note 19c)	 	 	(129,845	) 	 	 	(105,508	) 	
Employee benefits expense	  	(Note 19d)	 	 	(1,701,918	) 	 	 	(1,482,842	) 	
Depreciation and amortization	  	(Note 19f)	 	 	(78,503	) 	 	 	(78,148	) 	
Changes in trade provisions	  	(Note 10)	 	 	(2,690	) 	 	 	(13,945	) 	
Other operating expenses	  	(Note 19g)	 	 	(356,001	) 	 	 	(283,577	) 	
	  		 	 	 	 	 	 	 	 	
OPERATING PROFIT	  		 	 	155,550	  	 	 	163,765	  	
	  		 	 	 	 	 	 	 	 	
Finance income	  	(Note 19h)	 	 	10,931	  	 	 	11,581	  	
Finance costs	  	(Note 19h)	 	 	(19,193	) 	 	 	(23,508	) 	
Net foreign exchange loss	  		 	 	(2,820	) 	 	 	(976	) 	
	  		 	 	 	 	 	 	 	 	
NET FINANCE EXPENSE	  	(Note 19h)	 	 	(11,082	) 	 	 	(12,903	) 	
	  		 	 	 	 	 	 	 	 	
PROFIT BEFORE TAX FROM CONTINUING OPERATIONS	  		 	 	144,468	  	 	 	150,862	  	
	  		 	 	 	 	 	 	 	 	
Income tax expense	  	(Note 18)	 	 	54,856	  	 	 	60,706	  	
	  		 	 	 	 	 	 	 	 	
PROFIT FOR THE PERIOD (from continuing operations)	  		 	 	89,612	  	 	 	90,156	  	
	  		 	 	 	 	 	 	 	 	
Profit after tax for the year from discontinued operations	  	(Note 21)	 	 	722	  	 	 	0	  	
	  		 	 	 	 	 	 	 	 	
PROFIT FOR THE PERIOD	  		 	 	90,334	  	 	 	90,156	  	
	  		 	 	 	 	 	 	 	 	
Profit attributable to:	  		 				 				
Net parent investment	  		 	 	87,937	  	 	 	89,749	  	
Non-controlling interests	  	(Note 16)	 	 	2,397	  	 	 	407	  	
	  		 	 	 	 	 	 	 	 	
Basic and diluted earnings per share attributable to equity holders of the parent (U.S. dollars)	  		 	 	N/A	  	 	 	N/A	  	
The accompanying Notes 1 to 24 are an integral part of these combined carve-out financial statements
 
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 ATALAYA LUXCO MIDCO PREDECESSOR
COMBINED CARVE-OUT STATEMENTS OF COMPREHENSIVE INCOME
(In thousands of U.S. dollars)

 	  	Year ended
December 31	 	 	January 1 to
November 30	 	
 	  	2011	 	 	2012	 	
Profit for the period	  	 	90,334	  	 	 	90,156	  	
Other comprehensive income	  				 				
Items that will not be reclassified to profit or loss	  	 	—	  	 	 	—	  	
			
Items that may be subsequently reclassified to profit or loss	  				 				
(Losses)/ gains on cash flow hedges	  	 	(418	) 	 	 	(2,560	) 	
Tax effect	  	 	125	  	 	 	768	  	
Currency translation differences	  	 	(47,638	) 	 	 	(4,629	) 	
	  	 	 	 	 	 	 	 	
	  	 	(47,931	) 	 	 	(6,421	) 	
	  	 	 	 	 	 	 	 	
Total comprehensive income for the period	  	 	42,403	  	 	 	83,735	  	
	  	 	 	 	 	 	 	 	
Attributable to:	  				 				
Net parent investment	  	 	41,517	  	 	 	82,251	  	
Non-controlling interests	  	 	886	  	 	 	1,484	  	
	  	 	 	 	 	 	 	 	
Total comprehensive income for the period	  	 	42,403	  	 	 	83,735	  	
	  	 	 	 	 	 	 	 	
The accompanying Notes 1 to 24 are an integral part of these combined carve-out financial statements
 
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 ATALAYA LUXCO MIDCO PREDECESSOR
COMBINED CARVE-OUT STATEMENTS OF CHANGES IN INVESTED EQUITY
(In thousands of U.S. dollars)

 	 	Net parent
investment	 	 	Hedges	 	 	Currency
translation
differences	 	 	Total net
parent
investment	 	 	Non-controlling
interests
(Note 16)	 	 	Total
invested
equity	 	
Balance at December 31, 2010 (Note 2)	 	 	587,383	  	 	 	1,483	  	 	 	55,594	  	 	 	644,460	  	 	 	13,672	  	 	 	658,132	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Profit for the period	 	 	87,937	  	 	 	—	  	 	 	—	  	 	 	87,937	  	 	 	2,397	  	 	 	90,334	  	
Other comprehensive income for the period	 	 	—	  	 	 	(293	) 	 	 	—	  	 	 	(293	) 	 	 	—	  	 	 	(293	) 	
Translation differences	 	 	—	  	 	 	—	  	 	 	(46,127	) 	 	 	(46,127	) 	 	 	(1,511	) 	 	 	(47,638	) 	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total comprehensive income for the period	 	 	87,937	  	 	 	(293	) 	 	 	(46,127	) 	 	 	41,517	  	 	 	886	  	 	 	42,403	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Movements in net parent investment (Note 2)	 	 	(69,310	) 	 	 	—	  	 	 	—	  	 	 	(69,310	) 	 	 	—	  	 	 	(69,310	) 	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance at December 31, 2011	 	 	606,010	  	 	 	1,190	  	 	 	9,467	  	 	 	616,667	  	 	 	14,558	  	 	 	631,225	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Profit for the period	 	 	89,749	  	 	 	—	  	 	 	—	  	 	 	89,749	  	 	 	407	  	 	 	90,156	  	
Other comprehensive income for the year	 	 	—	  	 	 	(1,792	) 	 	 	—	  	 	 	(1,792	) 	 	 	—	  	 	 	(1,792	) 	
Translation differences	 	 	—	  	 	 	—	  	 	 	(5,706	) 	 	 	(5,706	) 	 	 	1,077	  	 	 	(4,629	) 	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total comprehensive income for the year	 	 	89,749	  	 	 	(1,792	) 	 	 	(5,706	) 	 	 	82,251	  	 	 	1,484	  	 	 	83,735	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Dividends paid	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	(5,790	) 	 	 	(5,790	) 	
Acquisition of non-controlling interests	 	 	10,252	  	 	 	—	  	 	 	—	  	 	 	10,252	  	 	 	(10,252	) 	 	 	—	  	
Movements in net parent investment (Note 2)	 	 	(39,103	) 	 	 	—	  	 	 	—	  	 	 	(39,103	) 	 	 	—	  	 	 	(39,103	) 	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance at November 30, 2012	 	 	666,908	  	 	 	(602	) 	 	 	3,761	  	 	 	670,067	  	 	 	—	  	 	 	670,067	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
The accompanying Notes 1 to 24 are an integral part of these combined carve-out financial statements
 
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 ATALAYA LUXCO MIDCO PREDECESSOR
COMBINED CARVE-OUT STATEMENTS OF CASH FLOWS
(In thousands of U.S. dollars)

 	  	Year ended
December 31	 	 	January 1 to
November 30	 	
 	  	2011	 	 	2012	 	
CASH FLOWS FROM OPERATING ACTIVITIES	  				 				
Profit before tax from continuing operations	  	 	144,468	  	 	 	150,862	  	
	  	 	 	 	 	 	 	 	
Profit before tax from discontinuing operations	  	 	722	  	 	 	—	  	
	  	 	 	 	 	 	 	 	
Profit before taxation	  	 	145,190	  	 	 	150,862	  	
	  	 	 	 	 	 	 	 	
Adjustments for:	  	 	100,201	  	 	 	144,169	  	
Depreciation and amortization (Note 19f)	  	 	78,504	  	 	 	78,148	  	
Changes in provisions	  	 	(4,507	) 	 	 	30,066	  	
Impairment losses	  	 	11,224	  	 	 	21,658	  	
Allocation of government grants	  	 	(1,902	) 	 	 	(751	) 	
Losses on derecognition and disposal of fixed assets	  	 	5,800	  	 	 	2,145	  	
Finance income (Note 19h)	  	 	(10,931	) 	 	 	(11,581	) 	
Finance expense (Note 19h)	  	 	19,193	  	 	 	23,508	  	
Net foreign exchange loss	  	 	2,820	  	 	 	976	  	
	  	 	 	 	 	 	 	 	
Changes in working capital	  	 	(94,283	) 	 	 	(78,684	) 	
	  	 	 	 	 	 	 	 	
Trade and other receivables	  	 	(64,380	) 	 	 	(77,647	) 	
Trade and other payables	  	 	(29,464	) 	 	 	7,925	  	
Other payables	  	 	(439	) 	 	 	(8,962	) 	
	  	 	 	 	 	 	 	 	
Other cash flows from operating activities	  	 	(34,520	) 	 	 	(52,735	) 	
	  	 	 	 	 	 	 	 	
Interest paid	  	 	(21,300	) 	 	 	(13,231	) 	
Interest received	  	 	21,029	  	 	 	11,158	  	
Payment of taxes	  	 	(34,249	) 	 	 	(50,662	) 	
	  	 	 	 	 	 	 	 	
Net cash from operating activities	  	 	116,588	  	 	 	163,612	  	
	  	 	 	 	 	 	 	 	
CASH FLOWS FROM INVESTING ACTIVITIES	  				 				
Payments for investments	  	 	(165,193	) 	 	 	(118,856	) 	
	  	 	 	 	 	 	 	 	
Intangible assets	  	 	(73,921	) 	 	 	(12,083	) 	
Property, plant & equipment	  	 	(91,272	) 	 	 	(90,493	) 	
Financial assets	  	 	—	  	 	 	(16,280	) 	
	  	 	 	 	 	 	 	 	
Proceeds from disposals	  	 	30,596	  	 	 	134	  	
	  	 	 	 	 	 	 	 	
Intangible assets	  	 	—	  	 	 	—	  	
Property, plant & equipment	  	 	5,642	  	 	 	134	  	
Other financial assets	  	 	24,954	  	 	 	—	  	
	  	 	 	 	 	 	 	 	
Net cash from investing activities	  	 	(134,597	) 	 	 	(118,722	) 	
	  	 	 	 	 	 	 	 	
CASH FLOWS FROM FINANCING ACTIVITIES	  				 				
Acquisition of non-controlling interest	  	 	—	  	 	 	(10,252	) 	
Issuance of loans	  	 	127,226	  	 	 	39,624	  	
Repayment of loans	  	 	(32,528	) 	 	 	(77,710	) 	
Payment for dividends	  	 	(67,739	) 	 	 	(26,647	) 	
	  	 	 	 	 	 	 	 	
Net cash from financing activities	  	 	26,959	  	 	 	(74,985	) 	
	  	 	 	 	 	 	 	 	
Effect of changes in exchange rates	  	 	(121	) 	 	 	(2,192	) 	
	  	 	 	 	 	 	 	 	
Net increase/ (decrease) in cash and cash equivalents	  	 	8,829	  	 	 	(32,287	) 	
	  	 	 	 	 	 	 	 	
Cash and cash equivalents at the beginning of the period	  	 	73,076	  	 	 	81,905	  	
Cash and cash equivalents at the end of the period	  	 	81,905	  	 	 	49,618	  	
The accompanying Notes 1 to 24 are an integral part of these combined carve-out financial statements
 
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 ATALAYA LUXCO MIDCO PREDECESSOR
NOTES TO THE COMBINED CARVE-OUT FINANCIAL STATEMENTS
1. COMPANY INFORMATION
Atento Inversiones y Teleservicios S.A.U. (“AIT”) and subsidiaries (“AIT Group”) comprised a group of companies that offered contact management services to their clients throughout the entire contract life cycle through contact centers or multichannel platforms. The AIT Group was a 100% owned subsidiary of Telefónica S.A., the parent of a group of companies operating in the telecommunications, media and entertainment sectors (the “Telefónica Group”). The AIT Group operated in 15 countries worldwide offering its multi-national clients high-quality, tailored services for the customer-facing parts of their business. The core solutions offered to clients include customer service, sales, collections, technical support, service desk, back office support and other BPO/CRM processes, including increasingly sophisticated services, such as back-office financial processing of new credit applications. AIT Group services range from basic customer services to the management of sophisticated business processes through multiple channels using complex technologies.
In December 2012, certain funds affiliated with Bain Capital Partners, LLC (“Bain Capital”) entered into an agreement with Telefónica, S.A. for the acquisition of nearly 100% of the business of customer relationship management (“CRM”) carried out by the subsidiaries of the AIT Group (the “Acquisition”). Bain Capital, through a newly created entity denominated Atalaya Luxco Midco, S.á.r.l. (the “Successor” or “Midco”) and certain of its affiliates, acquired nearly all the subsidiaries of AIT (together, the “Acquired Subsidiaries”), except for the AIT Group subsidiaries in Venezuela and the remaining assets and liabilities of AIT itself. Although the formalization of the agreement occurred on December 12, 2012, the date of acquisition of control for the purpose of the business combination was December 1, 2012, the date as of which the operations acquired have been incorporated into the Successor’s financial statements.
2. BASIS OF PREPARATION
Atalaya Luxco Midco Predecessor, which represents the historical financial information of the Acquired Subsidiaries (the “Predecessor”), is not an existing legal entity for the periods presented in these combined carve-out financial statements. Management has prepared these combined carve-out financial statements for the purpose of including them in a prospectus as historical financial information of the operations of the AIT Group acquired by the Successor as described in Note 1 and for the purpose of allowing comparability with the Successor consolidated financial statements for the periods after the Acquisition. The Successor consolidated financial statements for the periods after the Acquisition are comprised of the Successor and its subsidiaries. The combined carve-out financial statements also provide a fair presentation of the combined entity’s financial position and allow users to assess the ability of the reporting entity to generate cash flows.
The combined carve-out financial statements are presented as of December 31, 2011 and as of management’s closing period of November 30, 2012, which is the last day before the Successor acquired control of the Acquired Subsidiaries. These combined carve-out financial statements have been prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS”).
The accompanying combined financial statements are presented on a combined carve-out basis from AIT and its subsidiaries’ historical consolidated financial statements prepared under International Financial Reporting Standards as endorsed by the European Union, which, for the periods presented herein, do not present differences as compared to International Financial Reporting Standards as issued by the International Accounting Standards Board. These combined carve-out financial statements are prepared based on the historical results of operations, cash flows, assets and liabilities of the Predecessor acquired by Successor and that are part of its consolidated group after the Acquisition, applying the principles underlying the consolidation procedures of International Accounting Standards (“IAS”) 27, Consolidated and Separate Financial Statements.
 
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The combined carve-out financial statements portray all the costs of doing business of the Predecessor, in line with U.S. Securities and Exchange Commission Staff Accounting Bulletin (“SAB”) Topic 1.B.1. Accordingly, the following describes the most significant allocations and assumptions applied by the directors when preparing the combined carve-out financial statements of the Predecessor.
The combined carve-out financial statements do not include the results of operations of the Venezuelan subsidiaries of the AIT Group, as these were not acquired in the Acquisition. The Venezuelan subsidiaries were separately managed, separately financed and have their own historical books and records. All intercompany trading transactions, all of which were transacted on an arm’s length basis, and balances between the Predecessor and the Venezuelan entities have been included as third-party transactions in the combined carve-out financial statements of the Predecessor.
In addition, the combined carve-out financial statements do not include certain assets, liabilities, reserves and the related income and expenses of AIT which were not acquired in the Acquisition and do not reflect the operations of the combined entities. The main assets and liabilities which have been carved out from AIT and are therefore not reflected in the combined carve-out financial statements are described below:
 
 	•	 	Cash and cash equivalents of AIT, together with any related income, as they were not acquired as part of the Acquisition.	
 
 	•	 	Short-term and long-term debt held by AIT with financial institutions, as the debt was not part of the Acquisition and such debt and the related interest expense are not representative of the operations of the combined entities because the funds obtained through these loans were not utilized in the operations of the combined entities.	
 
 	•	 	Deferred tax assets of AIT, because the fiscal benefits of the deferred tax assets are utilized by Telefónica, S.A. in its consolidated tax filing and were not utilized for the fiscal benefit of AIT or its subsidiaries. The Telefónica Group ultimately bears the obligation for filing tax returns with the regulatory tax administration. Further, deferred tax assets were not acquired by Bain Capital as there was no fiscal benefit to AIT’s acquired assets and liabilities or the acquired subsidiaries.	
The main impact from the carve-out of the Venezuelan subsidiaries and certain assets and liabilities of AIT is the following for each of the periods (in thousands of U.S. dollars):

 	  	January 1, 2011	 	  	December 31, 2011	 	 	November 30, 2012	 	
Non-current assets	  	 	46,030	  	  	 	24,594	  	 	 	26,970	  	
Current assets	  	 	44,759	  	  	 	58,158	  	 	 	46,754	  	
	  	 	 	 	  	 	 	 	 	 	 	 	
Total assets	  	 	90,789	  	  	 	82,752	  	 	 	73,724	  	
	  	 	 	 	  	 	 	 	 	 	 	 	
Non-current liabilities	  	 	502	  	  	 	441	  	 	 	(428	) 	
Current liabilities	  	 	17,758	  	  	 	36,502	  	 	 	26,782	  	
	  	 	 	 	  	 	 	 	 	 	 	 	
Equity	  	 	72,529	  	  	 	45,809	  	 	 	47,370	  	
	  	 	 	 	  	 	 	 	 	 	 	 	
Total Liabilities and Equity	  	 	90,789	  	  	 	82,752	  	 	 	73,724	  	
	  	 	 	 	  	 	 	 	 	 	 	 	
Revenues	  	 	—	  	  	 	89,178	  	 	 	72,188	  	
	  	 	 	 	  	 	 	 	 	 	 	 	
Operating profit (Loss)	  	 	—	  	  	 	(14,830	) 	 	 	(11,543	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	
Profit (loss) for the year/period	  	 	—	  	  	 	(60,172	) 	 	 	3,463	  	
	  	 	 	 	  	 	 	 	 	 	 	 	
In addition, certain AIT operating expenses attributable to the combined entities were included in the combined carve-out income statements to reflect the actual costs incurred to operate the business of the Acquired Subsidiaries. However, such expenses may not be indicative of the actual level of expense that would have been incurred by the Predecessor if it had operated as a separate entity during all of the periods presented.
 
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All intercompany transactions and accounts within the Predecessor and its controlled entities have been eliminated in full. Transactions between the Predecessor and the parts of the AIT Group that were not acquired in the Acquisition that were previously eliminated in the consolidated financial statements of the AIT Group have been reinstated in these combined carve-out financial statements. Transactions that have taken place with the Telefónica Group (including the parts of the AIT Group) that were not acquired are regarded as transactions with related parties and as such have been disclosed in accordance of IAS 24, Related Party Disclosures.
These combined carve-out financial statements include a theoretical income tax calculation as if the entities were separate legal entities preparing income taxes at the company level.
As these financial statements have been prepared on a combined carve-out basis, it is not meaningful to show share capital or provide an analysis of reserves. Therefore, amounts which reflect the carrying value of investments of AIT in the combined entities are disclosed as “Net parent investment”, while carrying value of net assets attributable to shareholders other than AIT are presented as “Non-controlling interests”. The amounts reflected in Movements in net parent investment in the combined statement of changes in invested equity refer to payments of dividends made by certain subsidiaries to the former shareholder (AIT), which have been considered as transactions with third parties, the change of the net assets among periods acquired in the Acquisition from AIT and the payments made by the combined entities related to acquired assets. In addition, as the combined entities have no historical capital structure since the Predecessor was not an existing legal entity during the periods presented, earnings per share as required by IAS 33, Earnings per Share have not been presented.
Accordingly, after carving-out the abovementioned transactions, the total “Net parent investment” as of January 1, 2011 is a result of the following main net assets:

January 1, 2011	  	Assets	 	  	Current Liabilities	 	  	Non current liabilities	 	  	Net assets	 	
Gr. Atento (Total)	  	 	1,152,527	  	  	 	438,956	  	  	 	55,439	  	  	 	658,132	  	
Gr. Atento Argentina	  	 	51,845	  	  	 	29,974	  	  	 	312	  	  	 	21,559	  	
Atento Holding Chile	  	 	17,012	  	  	 	108	  	  	 	—	  	  	 	16,904	  	
Gr. Atento Chile	  	 	50,000	  	  	 	12,294	  	  	 	810	  	  	 	36,896	  	
Atento Perú, SAC	  	 	50,590	  	  	 	21,783	  	  	 	362	  	  	 	28,445	  	
Gr. Atento Mexico	  	 	105,621	  	  	 	42,949	  	  	 	14	  	  	 	62,658	  	
Gr. Atento Centroamérica	  	 	23,232	  	  	 	4,772	  	  	 	62	  	  	 	18,398	  	
Atento Colombia	  	 	22,927	  	  	 	10,612	  	  	 	40	  	  	 	12,275	  	
Atento Texas	  	 	8,334	  	  	 	2,629	  	  	 	—	  	  	 	5,705	  	
Atento Puerto Rico + USA	  	 	9,405	  	  	 	2,286	  	  	 	—	  	  	 	7,119	  	
Atento do Brasil, LTDA (Brasil)	  	 	641,718	  	  	 	245,261	  	  	 	53,189	  	  	 	343,268	  	
Gr. Atento España	  	 	105,059	  	  	 	49,914	  	  	 	469	  	  	 	54,676	  	
Atento Marruecos	  	 	19,327	  	  	 	7,254	  	  	 	—	  	  	 	12,073	  	
Atento Italia	  	 	355	  	  	 	958	  	  	 	—	  	  	 	(604	) 	
Atento Chequia	  	 	5,849	  	  	 	1,804	  	  	 	—	  	  	 	4,045	  	
Atento N.V.	  	 	27,958	  	  	 	122	  	  	 	—	  	  	 	27,836	  	
AIT	  	 	13,295	  	  	 	6,236	  	  	 	180	  	  	 	6.879	  	
The combined statements of cash flows have been prepared under the indirect method in accordance with IAS 7, Cash Flow Statements. Foreign currency transactions are translated at the average exchange rate for the year, in those cases where the currency differs from the presentation currency of the Predecessor (the U.S. dollar), as outlined in Note 3b. The net change in cash and cash equivalents reflects the movement in the corresponding year, with the beginning balances for each year taking into account the impact of differences arising from the translation of foreign currency balances using the aforementioned translation method.
Management believes that the assumptions and estimates used in preparation of the underlying combined carve-out financial statements are reasonable. However, the combined carve-out financial statements herein do not necessarily reflect what the Predecessor’s financial position, results of operations or cash flows would have
 
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been if the Predecessor had operated as a separate entity during the periods presented. As a result, historical financial information is not necessarily indicative of the Predecessor´s future results of operations, financial position or cash flows.
The figures in these combined carve-out financial statements are expressed in thousands of U.S. dollars unless otherwise indicated. The U.S. dollar is the Predecessor´s presentation currency, which differs from the AIT Group’s presentation currency, which was the Euro. Therefore, the change in the presentation currency of the combined entities, compared to the currency in which they were historically presented under the AIT Group reporting, has been treated as a change in accounting policy and accounted for retrospectively. There has been no effect due to this change other than the presentation of all numbers in U.S. dollars and the inclusion of an opening statement of financial position as of the beginning of the comparative period.
These combined carve-out financial statements have been prepared on a historical cost basis, except for derivative financial instruments, which have been measured at fair value.
3. ACCOUNTING POLICIES
The principal accounting policies used in preparing the combined carve-out financial statements were as follows:
a) Goodwill
For acquisitions taking place after January 1, 2004, the IFRS transition date of the Predecessor, goodwill represents the excess of the acquisition consideration over the acquirer’s interest, at the acquisition date, in the fair values of the identifiable assets and liabilities acquired from a subsidiary. After initial measurement, goodwill is carried at cost, less any accumulated impairment losses.
In the transition to IFRS, the Predecessor availed itself of the exemption allowing it not to restate business combinations taking place before January 1, 2004. As a result, the accompanying combined carve-out statements of financial position include goodwill as of the opening balance sheet date of January 1, 2011 as previously carried in the financial statements of AIT and translated into the new presentation currency, U.S. dollars. Deferred tax liabilities due to temporary differences related to goodwill arise due to the amortization of goodwill for tax purposes, as goodwill is not amortized for accounting purposes.
In all cases, goodwill is recognized as an asset denominated in the currency of the company acquired.
Goodwill is tested for impairment annually or more frequently if there are certain events or changes in circumstances indicating the possibility that the carrying amount may not be fully recoverable.
The potential impairment loss is determined by assessing the recoverable amount of the cash-generating unit (“CGU”) or group of CGUs to which the goodwill is allocated based on the identified synergies that will benefit the CGU or group of CGUs. Where the recoverable amount is less than the carrying amount, the CGU is considered impaired and a provision is recognized to reflect the loss. The impairment then obtained is allocated to goodwill first and the remainder provision (if any) proportionally to the rest of the assets of the CGU. The goodwill impairment is irreversible impairment.
b) Translation methodology
The combined carve-out financial statements of the Predecessor´s foreign subsidiaries were translated to U.S. dollars at period-end exchange rates, except for:
 
 	1.	 	Net parent investment, which was translated at historical exchange rates.	
 
 	2.	 	Income statements, which were translated at the average exchange rates for the period.	
 
 	3.	 	Cash flow statements, which were translated at the average exchange rates for the period.	
 
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Goodwill and fair value adjustments of statement of financial position items arising on the acquisition of an interest in a foreign operation are treated as part of the assets and liabilities of the acquired company and, therefore, translated at its closing rate at period end.
The exchange rate differences arising from the application of this method are included in “Translation differences” under “Total Net parent investment” in the accompanying combined statements of financial position, net of the portion of said differences attributable to non-controlling interests, which is shown under “Non-controlling interests”.
c) Foreign currency transactions
Monetary assets and liabilities denominated in a different currency than the functional currency of the combined entities are initially recorded at the functional currency rate at the date of the transaction and retranslated at the rate of exchange at the close of the period, recognizing the difference between both amounts in profit or loss for the period.
d) Intangible assets
“Intangible assets” are stated at acquisition cost, less any accumulated amortization and any accumulated impairment losses. Intangible assets acquired in a business combination are initially measured at fair value at the date of acquisition.
Acquisition cost comprises the purchase price, including import duties and non-refundable taxes, after deducting trade discounts and rebates, and directly attributable costs of readying the asset for its intended use.
The useful lives of intangible assets are assessed on a case-by-case basis to be either finite or indefinite. Intangible assets with finite lives are amortized on a straight line basis over their estimated useful life and assessed for impairment whenever events or changes indicate that their carrying amount may not be recoverable. At December 31, 2011 and November 30, 2012 there were no intangible assets with an indefinite useful life.
The amortization charge is recognized in the consolidated income statement under “Depreciation and amortization.”
Amortization methods and schedules are revised annually at each financial year-end and, where appropriate, adjusted prospectively.
Computer software
Software is measured at cost and amortized on a straight-line basis over its useful life, generally estimated at between three and five years.
Intellectual property
Amounts paid to acquire or use intellectual property are recognized under “Intellectual property”. Intellectual property is amortized on a straight-line basis over its useful life, estimated at 10 years.
Other intangible assets and development costs
Development costs are recognized when specific criteria are satisfied, being these criteria mainly related with the probability of generating future revenue because the project developed is viable, the availability of resources and the intention to finalize the project, being the costs associated to it reliably estimated.
These assets are amortized on a straight-line basis over their useful life, which ranges from 4 to 10 years.
 
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e) Property, plant and equipment
Property, plant and equipment is measured at cost, less any accumulated depreciation and any impairment losses. Land is not depreciated. Property, plant and equipment acquired in a business combination are initially measured at fair value at the date of acquisition.
Acquisition cost comprises the purchase price, including import duties and non-refundable taxes, after deducting trade discounts and rebates, and directly attributable costs of readying the asset for its intended use.
Cost also includes, where appropriate, the initial estimate of decommissioning, withdrawal and site reconditioning costs when the Predecessor is obliged to bear the expenditures because of the use of the assets.
Repairs which do not prolong the useful life of the assets and maintenance costs are recognized directly in the income statement. Costs which prolong or improve the life of the asset are capitalized as an increase in the cost of the asset.
The Predecessor assesses the need to write down, if appropriate, the carrying amount of each item of property, plant and equipment to its recoverable amount at each financial year-end, whenever there are indications that the assets’ carrying amount may not be fully recoverable through the generation of sufficient future revenue. The impairment provision is reversed if the factors giving rise to the impairment cease to exist (see Note 3f).
The depreciation charge for property, plant and equipment is recognized in the consolidated income statement under “Depreciation and amortization.”
Depreciation is calculated on a straight-line basis over the useful life of the asset applying individual rates to each asset, which are reviewed at each financial year-end. For those assets acquired through a business combination, the Group decided to maintain its useful lives.
The useful lives generally used by the Predecessor are as follows:

 	  	Years of useful life	
Owned buildings and Leasehold improvements	  	5 – 40	
Plant and equipment	  	5 – 6	
Furniture	  	10	
Data processing equipment	  	4 – 5	
Transport equipment	  	7	
Other property, plant and equipment	  	5 – 8	
f) Impairment of non-current assets
The Predecessor assesses at each reporting date whether there is an indication that a non-current asset may be impaired. If any such indication exists, or when annual impairment testing for an asset is required (e.g. goodwill), the Predecessor estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of fair value less costs to sell or its value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using an after-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. Where the carrying amount of an asset exceeds its recoverable amount, the asset is considered to be impaired. In this case, the carrying amount is written down to its recoverable amount and the resulting loss is recognized in the income statement. Future depreciation/amortization charges are adjusted for the asset’s new carrying amount over its remaining useful life. Management analyzes the impairment of each asset individually, except in the case of assets that generate cash flows which are interdependent on those generated by other assets (cash-generating units).
 
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The Predecessor bases the calculation of impairment on the business plans of the various cash generating units to which the assets are allocated. These business plans cover five years. The projections in year five and beyond are modeled based on an estimated constant or decreasing growth rate.
When there are new events or changes in circumstances that indicate that a previously recognized impairment loss no longer exists or has been decreased, a new estimate of the asset’s recoverable amount is made. A previously recognized impairment loss is reversed only if there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognized. If that is the case, the carrying amount of the asset is increased to its recoverable amount. The reversal is limited to the carrying amount that would have been determined had no impairment loss been recognized for the asset in prior years. Such reversal is recognized in the income statement and the depreciation charge is adjusted in future periods to reflect the asset’s revised carrying amount. Impairment losses relating to goodwill cannot be reversed in future periods.
g) Leases (as lessee)
Leases where the lessor does not transfer substantially all the risks and benefits of ownership of the asset are classified as operating leases. Operating lease payments are recognized as an expense in the income statement on a straight-line basis over the lease term.
Those lease arrangements that transfer to the Predecessor the significant risks and benefits inherent in holding the leased item are treated as finance leases, with the asset recorded at the inception of the lease, classified by type, and the related debt recorded at the lower of the present value of the minimum lease payments or the fair value of the leased asset. Lease payments are apportioned between the finance charges and reduction of the principal of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are reflected in the income statement over the lease term.
h) Financial assets
All purchases and sales of financial assets are recognized on the statement of financial position on the trade date, i.e., when the commitment is made to purchase or sell the asset.
On the date of initial recognition, the Predecessor classifies its financial assets in four categories: financial assets at fair value through profit or loss, loans and receivables, held-to- maturity investments, and available-for-sale financial assets. These classifications are revised at year end and modified where applicable. The Predecessor classifies all its financial assets as loans and receivables, except for derivative financial instruments, which are classified as financial assets at fair value through profit or loss.
This category of loans and receivables consists of fixed-maturity financial assets not listed in active markets. These assets are carried at amortized cost using the effective interest rate method. Gains and losses are recognized in the income statement when the loans and receivables are derecognized or impaired, as well as through the amortization process.
An impairment analysis of financial assets is performed at each statement financial position date. If there is objective evidence that an impairment loss on a financial asset carried at amortized cost has been incurred, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows (excluding future expected credit losses that have not been incurred) discounted at the financial asset’s original effective interest rate.
A financial asset is only fully or partially derecognized from the statement of financial position when:
 
 	1.	 	the rights to receive cash flows from the asset have expired;	
 
 	2.	 	The Predecessor has assumed an obligation to pay the cash flows received from the asset to a third party; or	
 
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 	3.	 	The Predecessor has transferred its rights to receive cash flows from the asset to a third party and transferred substantially all the risks and rewards of the asset.	
i) Cash and cash equivalents
Cash and cash equivalents in the combined carve-out statement of financial position comprise cash on hand and at banks, demand deposits and other highly liquid investments with an original maturity of three months or less.
These items are stated at historical cost, which does not differ significantly from realizable value.
For the purpose of the combined carve-out statement of cash flows, cash and cash equivalents are shown net of any outstanding bank overdrafts.
j) Financial liabilities
Debts are recognized initially at fair value, which is usually the amount of the consideration received, less directly attributable transaction costs. After initial recognition, these financial liabilities are measured at amortized cost using the effective interest rate method. Any difference between the cash received (net of transaction costs) and the repayment value is recognized in the income statement over the life of the debt. Debts are shown as non-current liabilities when the maturity date is longer than 12 months or the Predecessor has the unconditional right to defer settlement for at least 12 months from the statement of financial position date.
Financial liabilities are derecognized from the statement of financial position when the corresponding obligation is settled, cancelled or matures. Where an existing financial liability is replaced by another from the same lender under substantially different terms, such an exchange is treated as a derecognition of the original liability and the recognition of a new liability, and the difference between the respective carrying amounts is recognized in the income statement.
k) Derivative financial instruments and hedging
Derivative financial instruments are initially recognized at fair value, normally equivalent to cost. Their carrying amounts are subsequently re-measured at fair value. Derivatives are carried as assets when the fair value is positive and as liabilities when the fair value is negative. The full fair value of a hedging derivative is classified as a non-current asset or liability when the remaining hedged item is more than 12 months and as a current asset or liability when the remaining maturity of the hedged item is less than 12 months. Trading derivatives are classified as a current asset or liability.
The accounting treatment of any gain or loss resulting from changes in the fair value of a derivative depends on whether the derivative in question meets all the criteria for hedge accounting and, if appropriate, on the nature of the hedge. The Predecessor documents at the inception of the transaction the relationship between hedging instruments and hedged items, as well as its risk management objectives and strategy for undertaking various hedging transactions. The Predecessor also documents its assessment, both at hedge inception and on an ongoing basis, of whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in fair values or cash flows of hedged items.
Fair value hedge:
Changes in fair value of the hedging derivative and of the hedged item attributable to the risk hedged are recognized in the income statement. The Predecessor only applies fair value hedge accounting for hedging debts incurred in currencies other than those of countries where it operates or where the companies taking on the debt
 
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are domiciled. The gain or loss relating to the effective portion of the hedge is recognized in the income statement within ‘finance costs’. The gain or loss relating to the ineffective portion is recognized in the income statement within finance income or finance costs, as applicable.
If the hedge no longer meets the criteria for hedge accounting, the adjustment to the carrying amount of a hedged item for which the effective interest method is used is amortized to profit or loss over the period to maturity.
Cash flow hedge:
The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognized in other comprehensive income. The gain or loss relating to the ineffective portion is recognized immediately in the income statement within finance income or finance costs, as applicable.
Amounts accumulated in equity are reclassified to profit or loss in the periods when the hedged item affects profit or loss (for example, when the forecast sale that is hedged takes place). The gain or loss relating to the effective portion of interest rate swaps hedging variable rate borrowings is recognized in the income statement within finance income or finance costs, as applicable.
When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity and is recognized when the forecast transaction is ultimately recognized in the income statement. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately transferred to the income statement within finance income or finance costs, as applicable.
The fair value of the derivative portfolio reflects estimates based on calculations made using observable market data, as well as specific pricing and risk-management tools commonly used by financial entities.
l) Trade receivables
Trade receivables are recognized at the original invoice amount and at the accrued amount when unbilled. A provision for impairment is recorded when there is objective evidence of impairment. The amount of the impairment provision is calculated as the difference between the carrying amount of the doubtful trade receivables and their recoverable amount. In general, cash flows relating to short-term receivables are not discounted.
m) Grants received
Government grants are recognized in the account “Deferred income”, part of “Other non-trade payables” in the statement of financial position. Where there is reasonable assurance that the grant will be received and all attaching conditions will be complied with, they are released to income in equal amounts over the useful life of the related assets as “Government grants” under “Other operating income” in the income statement. When the grant relates to an expense item, it is recognized as income over the period necessary to match the grant to the costs that it is intended to compensate.
n) Provisions
Provisions are recognized when as a result of a past event, for which the Predecessor has a present obligation (legal or constructive), it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. When the Predecessor expects some or all of a provision to be reimbursed, for example under an insurance contract, the reimbursement is recognized as a separate asset, but only when the reimbursement is virtually certain, in which
 
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case the expense relating to the provision is presented in the statement of financial position net of such reimbursement. If the effect of the time value of money is material, provisions are discounted, and the corresponding increase in the provision due to the passage of time is recognized as a finance cost.
o) Share-based payments linked to the Telefónica, S.A. share price.
Certain Predecessor management had a variable remuneration scheme which is linked to the quoted share price of Telefónica, S.A.
The Directors’ remuneration plan lasts for seven years and comprises five three-year cycles (or completely independent payment dates), the first commencing on July 1, 2006. The right, granted at the commencement of each cycle, to receive a certain number of Telefónica, S.A. shares at the end of the same cycle is subject to certain conditions being met. Telefónica, S.A. invoices the cost of the plan to its subsidiaries at the end of each cycle. The invoices are for the total cost, equal to the fair value of the instruments delivered, calculated at the beginning date of each cycle.
Due to its characteristics, this plan is subject to IFRS 2, Share-based payments, on the grounds that it is the entity that was the parent during the predecessor reporting period (Telefónica, S.A.) that granted the share option rights for its own shares to the employees of a subsidiary. Thus, it is treated as a share-based payment transaction, and the Predecessor recognizes the expense corresponding to its employees with a balancing entry in accounts payable with Telefonica spread out over each three-year cycle.
p) Income tax
This heading in the accompanying combined carve-out income statement includes all the expenses and credits arising from the combined entities calculated using a method consistent with a separate tax return basis, as if the Predecessor was a separate tax payer (see Note 2). Income tax expense of each period is the aggregate amount of current and deferred taxes, if applicable.
Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to taxation authorities. The tax rates and tax laws used to compute the amount are those that are substantively enacted by the statement of financial position date. The entity offsets current tax assets and current tax liabilities if there is a legally enforceable right to set off the recognised amounts and the Predecessor intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.
Deferred taxes are calculated based on analysis of the statement of financial position, in consideration of temporary differences generated from differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.
The main temporary differences arise due to differences between the tax bases and carrying amounts of plant, property and equipment, intangible assets, goodwill and non-deductible provisions, as well as differences between the fair value and tax bases of net assets acquired from a subsidiary.
Furthermore, deferred taxes arise from unused tax credits and tax loss carryforwards.
The Predecessor determines deferred tax assets and liabilities by applying the tax rates expected to be effective for the period when the corresponding asset is realized or the liability is settled, based on tax rates and tax laws that had been enacted (or substantively enacted) by the statement of financial position date.
The carrying amount of deferred income tax assets is reviewed at each statement of financial position date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow part or all of the deferred tax asset to be utilized. Unrecognized deferred income tax assets are reassessed at each statement of financial position date and are recognized to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.
 
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Deferred tax liabilities associated with investments in subsidiaries and branches are not recognized where the timing of the reversal of the temporary difference can be controlled by the parent company and it is not probable that the temporary differences will reverse in the foreseeable future.
Deferred income tax relating to items directly recognized in equity is also recognized in equity. Deferred tax assets and liabilities resulting from business combinations are added to or deducted from goodwill.
Deferred tax assets and liabilities are offset only if a legally enforceable right exists to set off current tax assets against current income tax liabilities and the deferred income taxes relate to the same taxable entity and the same taxation authority.
q) Revenue recognition
Revenue and expenses are recognized in the income statement on an accrual basis, i.e. when the goods or services represented by them take place, regardless of when actual payment or collection occurs.
Revenue comprises the fair value of the consideration received or receivable for services rendered in the normal course of the Predecessor’s activities. Revenue is presented net of sales taxes or value added taxes, returns, allowances and discounts. Revenue is recognized when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and specific criteria have been met for the Predecessor’s activities as described below.
For sales of services, revenue is recognized in the accounting period in which the services are rendered, by reference to stage of completion of the specific transaction and assessed on the basis of the actual service provided as a proportion of the total services to be provided, when the costs and revenue of the service contract, as well as its percentage of completion, can be reliably measured and it is probable that the related receivables will be collected. When one or more elements of a service contract cannot be reliably measured, revenue is recognized only to the extent of contract costs incurred that it is probable that will be recovered.
The Predecessor obtains revenue mainly from the provision of customer services, recognizing the revenue when the teleoperation occurs (based on the stage of completion of the service provided) or when certain contact center consulting work is carried out.
r) Expenses
Expenses are recognized in the income statement on an accrual basis; i.e. when the goods or services represented by them take place, regardless of when actual payment or collection occurs.
The Predecessor’s incorporation, start-up and research expenses, as well as expenses that do not qualify for capitalization under IFRS, are recognized in the combined carve-out income statement when incurred and classified in accordance with their nature.
s) Employee benefits
Pension Obligations
The Predecessor provides a pension plan for managers, which is deemed a defined contribution plan. The plan is financed exclusively by the entity via contributions at a certain percentage of the executive’s fixed remunerations. These percentages vary depending on the employee’s professional category. The group has no legal or constructive obligations to pay further contributions if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.
 
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For defined contribution plans, the group pays contributions to publicly or privately administered pension insurance plans on a mandatory, contractual or voluntary basis. The group has no further payment obligations once the contributions have been paid. The contributions are recognized as employee benefit expense as part of “Employee benefits expense” when they are due. Prepaid contributions are recognized as an asset to the extent that a cash refund or a reduction in the future payments is available.
Termination benefits
Under current labor legislation, the companies are required to pay indemnities to employees whose contracts are terminated under certain conditions. Reasonably quantifiable severance indemnities are therefore recognized as an expense in the year in which the decision to terminate the employment is made.
t) Use of estimates and management’s judgment
The key assumptions concerning the future and other key sources of estimation uncertainty at the statement of financial position date that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.
A significant change in the facts and circumstances on which these estimates are based could have a material impact on the Predecessor´s results and financial position.
Revenue Recognition
The Predecessor recognizes revenues on an accrual basis during the period in which the services are rendered, by reference to the stage of completion of the specific transaction and assessed on the basis of the actual service provided as a proportion of the total service to be provided, as described in Note 3 q) above. Recognizing service revenue by reference to the stage of completion involves the use of estimates in relation to certain key elements of the service contracts, such as contract costs, period of execution and allowances related to the contracts. As far as practicable the Predecessor applies past experience and specific quantitative indicators in its estimates, considering the specific circumstances applicable to specific customers or contracts. If certain circumstances have occurred that may have an impact on the initially estimated revenue, costs or percentage of completion, estimates are reviewed based on such circumstances. Such reviews may result in adjustments to costs and revenue recognized for a period.
Property, plant and equipment, intangible assets and goodwill
The accounting treatment of property, plant and equipment and intangible assets entails the use of estimates to determine their useful life for depreciation and amortization purposes and to assess fair value at their acquisition date, especially significant in relation to assets acquired in business combinations.
Determining useful life requires making estimates in connection with future technological developments and alternative uses for assets. There is a significant element of judgment involved in making technological development assumptions, since the timing and scope of future technological advances are difficult to predict.
When an item of property, plant and equipment or an intangible asset is considered to be impaired, the impairment loss is recognized in the income statement for the period. The decision to recognize an impairment loss involves estimates of the timing and amount of the impairment, as well as analysis of the reasons for the potential loss. Furthermore, additional factors, such as technological obsolescence, the suspension of certain services and other circumstantial changes are taken into account.
The Predecessor evaluates the performance of its cash-generating units regularly to identify potential impairment of goodwill. Determining the recoverable amount of the cash-generating units to which goodwill is allocated also entails the use of assumptions and estimates and requires a significant element of judgment (see Note 7).
 
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Deferred taxes
The Predecessor assesses the recoverability of deferred tax assets based on estimates of future earnings. The ability to recover these taxes depends ultimately on the Predecessor’s ability to generate taxable earnings over the period for which the deferred tax assets remain deductible. This analysis is based on the estimated timing of the reversal of deferred tax liabilities, as well as estimates of taxable earnings, which are sourced from internal projections and are continuously updated to reflect the latest trends.
The appropriate classification of tax assets and liabilities depends on a series of factors, including estimates as to the timing and realization of deferred tax assets and the projected tax payment schedule. Actual income tax receipts and payments could differ from the estimates made by the Predecessor as a result of changes in tax legislation or unforeseen transactions that could affect tax balances. (see Note 18).
Provisions
Provisions are recognized when the Predecessor has a present obligation as a result of a past event, it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. This obligation may be legal or constructive, deriving, inter alia, from regulations, contracts, customary practice or public commitments that lead third parties to reasonably expect that the Predecessor will assume certain responsibilities. The amount of the provision is determined based on the best estimate of the outflow of resources required to settle the obligation, bearing in mind all available information at the closing date, including the opinions of independent experts such as legal counsel or consultants.
No provision is recognized if the amount of liability cannot be estimated reliably. In this case, the relevant information is provided in the notes to the financial statements.
Given the uncertainties inherent in the estimates used to determine the amount of provisions, actual outflows of resources may differ from the amounts recognized originally on the basis of the estimates. (see Note 17).
u) Combination method
The full consolidation method is applied to all combined entities. Under this method, all their assets, liabilities, revenues, expenses and cash flows are included in the combined carve-out financial statements after the appropriate adjustments and eliminations of inter-group transactions. Combined entities are those in which the Predecessor owns more than half of the voting rights or has the ability to govern their financial and operating policies.
In the case of combined entities whose adopted accounting policies and principles differ from those of the Predecessor, adjustments or restatements were made upon combination in order to present the combined carve-out financial statements on a uniform basis for adaptation to IFRS.
All material accounts and transactions between combined companies were eliminated on consolidation.
v) Non-controlling interests
Non-controlling interests represent the portion of profit and loss and net assets of the combined entities not held by the Predecessor and are presented in the combined income statement and within equity in the combined statement of financial position, separately from the net parent investment (see Note 2). The Predecessor accounts for transactions with non-controlling interests as transactions with equity owners. The difference between any consideration paid or received and relevant share of the carrying value of net assets acquired or sold, is recorded in the net parent investment.
 
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w) New standards issued and early adopted as of November 30, 2012
The Predecessor opted for the early adoption of the following amendment issued by the IASB:

Standards and amendments	  	Effective date—annual
periods beginning after:	
IAS 1 – Financial statement presentation	  	July 1, 2012—early
adoption permitted,	
Regarding the presentation of (1) other comprehensive income and (2) third statement of financial position without the related financial statement notes	  	January 1, 2013—early
adoption permitted	
x) New standards and IFRIC interpretations issued but not yet adopted as of November 30, 2012
A number of new standards and amendments to standards and interpretations are effective for annual periods beginning after November 30, 2012, and have not been applied in preparing these combined carve-out financial statements. None of these are expected to have a significant effect on the combined carve-out financial statements of the Predecessor, except the following:

Standard Reference	  	Topic	  	Effective date—annual periods
beginning after:	
IFRS 9	  	Financial instruments	  	January 1, 2015	
IFRS 10	  	Consolidated financial statements	  	January 1, 2013	
IFRS 11	  	Joint arrangements	  	January 1, 2013	
IFRS 12	  	Disclosures of interests in other entities	  	January 1, 2013	
IFRS 13	  	Fair value measurement	  	January 1, 2013	
IAS 19	  	Employee benefits	  	January 1, 2013	
With respect to such standards, the Predecessor has also evaluated its early application. The standards in the table above have not been early adopted because the Predecessor has concluded that their impact to the combined carve-out financial statements is not significant.
There are no other IFRSs or IFRIC interpretations that are not yet effective that would be expected to have a material impact on the group.
 
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4. COMBINED ENTITIES
The Predecessor´s combined entities at November 30, 2012 are as follows:

Registered name	 	Registered
address	 	Line of business	 	Functional
currency	 	%
interest (1)	 	Holding company	
Atento Teleservicios España, S.A.U.	 	Madrid (Spain)	 	Operation of call
centers	 	EUR	 	100	 	.	
Atento Servicios Técnicos y Consultoría, S.L.U.	 	Madrid
(Spain)	 	Execution of
technological projects
and services, and
consulting services	 	EUR	 	100	 	Atento Teleservicios
España S.A.U.	
Atento Impulsa, S.L.U. (3)	 	Barcelona
(Spain)	 	Management of
specialized
employment centers
for disabled workers	 	EUR	 	100	 	Atento Teleservicios
España S.A.U.	
Contact US Teleservices Inc	 	Houston—Texas
(USA)	 	Operation of call
centers	 	USD	 	100	 	Atento Mexicana,
S.A. de C.V.	
Atento Brasil, S.A.	 	Sao Paulo
(Brazil)	 	Operation of call
centers	 	BRL	 	99.999	 	Atento N.V.	
Teleatento del Perú, S.A.C.	 	Lima (Peru)	 	Operation of call
centers	 	PEN	 	83.3333
16.6667	 	Atento N.V.
Atento Holding
Chile, S.A.	
Atento Colombia, S.A.	 	Bogota DC
(Colombia)	 	Operation of call
centers	 	COP	 	94.97871
0.00854
0.00424
0.00424
5.00427	 	Atento N.V.
Atento Venezuela,
S.A.
Atento Brasil, S.A.
Teleatento del Perú,
S.A.C.
Atento Mexicana,
S.A. de C.V.	
Atento Holding Chile, S.A.	 	Santiago de Chile
(Chile)	 	Holding company	 	CLP	 	99.9999	 	Atento N.V.	
Centros de Contacto Salta, S.A.	 	Buenos Aires
(Argentina)	 	Operation of call
centers	 	ARS	 	95
5	 	Atento Holding
Chile, S.A.
Atento N.V.	
Mar del Plata Gestiones y Contactos, S.A.	 	Buenos Aires
(Argentina)	 	Operation of call
centers	 	ARS	 	95
5	 	Atento Holding
Chile, S.A.
Atento N.V.	
Microcentro de Contacto, S.A.	 	Buenos Aires
(Argentina)	 	Operation of call
centers	 	ARS	 	95
5	 	Atento Holding
Chile, S.A.
Atento N.V.	
Córdoba Gestiones y Contactos, S.A.	 	Cordoba
(Argentina)	 	Operation of call
centers	 	ARS	 	95
5	 	Atento Holding
Chile, S.A.
Atento N.V.	
Atusa, S.A.	 	Buenos Aires
(Argentina)	 	Operation of call
centers	 	ARS	 	5
95	 	Atento Holding
Chile, S.A.
Atento N.V.	
Atento Chile, S.A. (2)	 	Santiago de Chile
(Chile)	 	Operation of call
centers	 	CLP	 	71.16	 	Atento Holding
Chile, S.A.	
Atento Educación Limitada	 	Santiago de Chile
(Chile)	 	Operation of call
centers	 	CLP	 	99
1	 	Atento Chile, S.A.
Atento Holding
Chile, S.A.	
Atento Centro de Formación Técnica Limitada (4)	 	Santiago de Chile
(Chile)	 	Operation of call
centers	 	CLP	 	99
1	 	Atento Chile, S.A.
Atento Holding
Chile, S.A.	
Atento Argentina, S.A.	 	Buenos Aires
(Argentina)	 	Operation of call
centers	 	ARS	 	24.44
75.56	 	Atento N.V.
Atento Holding
Chile, S.A.	
Atento Puerto Rico, Inc.	 	Guaynabo
(Puerto Rico)	 	Operation of call
centers	 	USD	 	100	 	Atento N.V.	
Atento Mexicana, S.A. de C.V.	 	Mexico City
(Mexico)	 	Operation of call
centers	 	MXN	 	99.999998
0.000002	 	Atento N.V.
Atento Colombia,
S.A.	
Atento Servicios, S.A. de C.V.	 	Mexico City
(Mexico)	 	Sale of goods and
services	 	MXN	 	99.9995
0.0005	 	Atento Mexicana,
S.A. de C.V.
Atento N.V.	
 
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Registered name	 	Registered
address	 	Line of business	 	Functional
currency	 	%
interest (1)	 	Holding company	
Atento Atención y Servicios, S.A. de C.V.	 	Mexico City
(Mexico)	 	Administrative,
professional and
consulting services	 	MXN	 	99.998
0.002	 	Atento Mexicana,
S.A. de C.V.
Atento Servicios, S.
A. de C.V.	
Atento Centroamérica, S.A.	 	Guatemala
(Guatemala)	 	Holding company	 	GTQ	 	99.9999
0.0001	 	Atento N.V.
Atento El Salvador
S.A. de C.V.	
Atento de Guatemala, S.A.	 	Guatemala
(Guatemala)	 	Operation of call
centers	 	GTQ	 	99.99999
0.00001	 	Atento
Centroamérica. S.A.
Atento El Salvador
S.A. de C.V.	
Atento El Salvador, S.A. de C.V.	 	City of San
Salvador
(El Salvador)	 	Operation of call
centers	 	USD	 	7.4054
92.5946	 	Atento
Centroamerica, S.A.
Atento de
Guatemala, S.A.	
Atento Maroc, S.A.	 	Casablanca
(Morocco)	 	Operation of call
centers	 	MAD	 	99.9991	 	Atento Teleservicios
España S.A.U.	
Woknal, S.A.	 	Montevideo
(Uruguay)	 	Operation of call
centers	 	UYU	 	100	 	Atento N.V.	
Atento Ceská Republika, a.s.	 	Prague
(Czech Republic)	 	Telemarketing and
other financial and
business services	 	CZK	 	100	 	Atento Inversiones y
Teleservicios, S.A.U.	
Atento Panamá, S.A.	 	Panama City	 	Operation of call
centers	 	USD	 	99
1	 	Atento N.V.
Atento Mexicana,
S.A. de C.V.	

(1)	Shareholdings with voting rights.	
(2)	The remaining 28.84% interest is owned by Telefónica CTC Chile (27.41%), Compañía de Teléfonos Transmisiones Regionales S.A (0.47%) and Telefónica Empresas S.A. (0.96%).	
Changes in the combined entities
In 2011, Atento Italia S.R.L. was liquidated for failing to conduct business. The business dissolution request was filed with the Italian Chamber of Commerce on August 25, 2010. On October 14, 2011, a court ruling was issued in favor of the Predecessor over a labor suit filed by a former company employee. As a result, the company’s assets and liabilities were liquidated and returned to the sole shareholder (Atento, N.V.) at the end of 2011.
On March 2, 2012, the company Atento Servicios Auxiliares de Contact Center, S.L was registered with the Mercantile Register of Madrid.
There were also the following changes to the combined entities’ equity:
 
 	•	 	On February 28, 2011, Atento, N.V. subscribed in full to the equity issue undertaken by Woknal, establishing a share premium of 400,000 Uruguayan pesos, remaining as the company’s sole shareholder.	
 
 	•	 	On December 20, 2011, this company carried out another equity issue, for 30,250,000 Uruguayan pesos, with Atento, N.V. again remaining as its sole shareholder.	
 
 	•	 	On December 22, 2011, Atento Argentina’s capital increased by 1,000,000 Argentinean pesos in a transaction carried out by Atento, N.V., which is now a shareholder.	
There were no other changes in the combined entities in 2012.
 
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5. FINANCIAL RISK MANAGEMENT POLICY
Financial risk factors
The Predecessor´s activities expose it to a variety of financial risks: market risk (including currency risk, fair value interest rate risk, cash flow interest rate risk and price risk), credit risk and liquidity risk. The Predecessor´s overall risk management strategy focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the entity’s financial performance. The Predecessor uses derivatives to limit both interest and foreign currency risks on otherwise unhedged positions and to adapt its debt structure to market conditions.
Risk management is carried out by the finance department under policies approved by the respective corporate governance bodies. The finance department identifies, evaluates and hedges financial risks in close cooperation with the operating units.
Market Risk:
Foreign exchange risk:
The Predecessor operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to the Brazilian Real. Foreign exchange risk arises from future commercial transactions, recognised assets and liabilities and net investments in foreign operations.
The Predecessor´s management uses derivatives to hedge debts incurred in currencies other than those of countries where it operates or where the companies taking on the debt are domiciled. It aims to ensure that the hedging derivative and the underlying risk hedged belong to the same company. It also seeks to ensure that hedges cover the whole debt for the entire term of the transaction being hedged.
In 2011, Atento Brasil, S.A. arranged a loan with Bradesco in the amount of 5,834 thousand U.S. dollars which was paid off on November 5, 2012. There is no outstanding balance for this loan as of November 30, 2012. In accordance with its risk hedging policy, the Predecessor has hedged this loan with a swap contract covering the entire debt throughout the term of the transaction and had classified these financial instruments as fair-value hedges from inception.
The details of the hedging instruments at December 31, 2011 are as follows:

Year	  	Underlying loan
(thousand)	 	  	Nominal in reais
(thousand)	 	  	Interest rate	 	 	Interest rate on
reais	 	
2011	  	 	USD 5,834	  	  	 	10,219 BRL	  	  	 	10.87	% 	 	 	112.5% CDI	  	
The hedging instruments are 100% effective.
At December 31, 2011 the equivalent fair value of the Predecessor´s interest rate hedges denominated in foreign currencies was estimated to be a liability of 1,664 thousand U.S. dollars, increasing current borrowings recognized under “Interest-bearing debt.”
At December 31, 2011, the Predecessor recognized financial losses of 365 thousand U.S. dollars in the income statement under “Finance costs” resulting from the settlement of financial derivative transactions and their measurement at the close date.
 
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Sensitivity analysis of foreign currency risk:
The Predecessor has reasonable control over its foreign currency risks as its financial assets and liabilities denominated in currencies other than their functional are adequately matched. The following sensitivity analysis, based on the outstanding volume of financial assets and liabilities (applying a 10% appreciation of each asset/liability currency versus the functional currency), highlights the limited impact that such an event would have on the income statement.

2011	 	
(in thousands)	 	Financial assets	 	 	Financial liabilities	 	 	Sensitivity analysis	 	
Functional—
Asset/liability
currency	 	Functional
currency	 	 	Asset
currency	 	 	U.S.
dollar	 	 	Functional
currency	 	 	Liability
currency	 	 	U.S.
dollar	 	 	Appreciation
of asset/
liability
currency vs.
functional	 	 	Functional
currency of
financial
assets	 	 	Functional
currency of
financial
liabilities	 	 	Profit or
(loss)
(U.S.
dollar)	 	
CLP-USD	 	 	645,086	  	 	 	1,242	  	 	 	1,242	  	 	 	64,942	  	 	 	125	  	 	 	125	  	 	 	10	% 	 	 	716,761	  	 	 	72,158	  	 	 	124	  	
CLP-EUR	 	 	74,009	  	 	 	110	  	 	 	142	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	10	% 	 	 	82,232	  	 	 	—	  	 	 	16	  	
COP-USD	 	 	468,918	  	 	 	241	  	 	 	241	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	10	% 	 	 	521,019	  	 	 	—	  	 	 	27	  	
MXN-USD	 	 	440	  	 	 	32	  	 	 	32	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	10	% 	 	 	489	  	 	 	—	  	 	 	4	  	
ARS-USD	 	 	—	  	 	 	—	  	 	 	—	  	 	 	856	  	 	 	199	  	 	 	199	  	 	 	10	% 	 	 	—	  	 	 	951	  	 	 	(22	) 	
UYU-USD	 	 	—	  	 	 	—	  	 	 	—	  	 	 	19,474	  	 	 	979	  	 	 	979	  	 	 	10	% 	 	 	—	  	 	 	21,638	  	 	 	(109	) 	
BRL-USD	 	 	—	  	 	 	—	  	 	 	—	  	 	 	11,015	  	 	 	5,872	  	 	 	5,872	  	 	 	10	% 	 	 	—	  	 	 	12,239	  	 	 	(652	) 	

2012	 	
(in thousands)	 	Financial assets	 	 	Financial liabilities	 	 	Sensitivity analysis	 	
Functional—
Asset/liability
currency	 	Functional
currency	 	 	Asset
currency	 	 	U.S.
dollar	 	 	Functional
currency	 	 	Liability
currency	 	 	U.S.
dollar	 	 	Appreciation
of asset/
liability
currency vs.
functional	 	 	Functional
currency of
financial
assets	 	 	Functional
currency of
financial
liabilities	 	 	Profit or
(loss)
(U.S.
dollar)	 	
UYU-USD	 	 	—	  	 	 	—	  	 	 	—	  	 	 	12,793	  	 	 	651	  	 	 	651	  	 	 	10	% 	 	 	—	  	 	 	14,214	  	 	 	(72	) 	
CLP-USD	 	 	2,333,117	  	 	 	4,857	  	 	 	4,857	  	 	 	32,667	  	 	 	68	  	 	 	68	  	 	 	10	% 	 	 	2,592,354	  	 	 	36,296	  	 	 	532	  	
ARS-USD	 	 	—	  	 	 	—	  	 	 	—	  	 	 	469	  	 	 	97	  	 	 	97	  	 	 	10	% 	 	 	—	  	 	 	521	  	 	 	(11	) 	
MXN-USD	 	 	21,350	  	 	 	1,652	  	 	 	1,652	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	10	% 	 	 	23,722	  	 	 	—	  	 	 	184	  	
COP-USD	 	 	270,758	  	 	 	149	  	 	 	149	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	10	% 	 	 	300,842	  	 	 	—	  	 	 	17	  	
CLP-EUR	 	 	12,832	  	 	 	21	  	 	 	27	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	10	% 	 	 	14,258	  	 	 	—	  	 	 	3	  	
GTQ-USD	 	 	5,091	  	 	 	645	  	 	 	645	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	10	% 	 	 	5,657	  	 	 	—	  	 	 	71	  	

*	Financial liabilities correspond to borrowings in currencies other than functional currencies. Financial assets correspond to cash and cash equivalents in currencies other than functional currencies. Example of the impact on profit of an appreciation of the asset/liability currency versus the functional currency. If we were to conduct this sensitivity analysis, assuming a depreciation, the impact on profit would be the same, but with the opposite sign.	
Country risk
To manage or mitigate country risk, the Predecessor transfers to Europe the funds generated in Latin America that are not required for the pursuit of new, profitable business opportunities in the region.
The net amounts transferred in this respect in 2011 and 2012 were 68,879 and 15,471 thousand U.S. dollars, respectively in the form of dividends, interest and loan principal.
Interest rate risk
Interest rate risk arises mainly as a result of changes in interest rates which affect: (i) finance costs of debt bearing a variable interest rate (or short term maturity debt expected to be rolled over), and (ii) the value of non-current liabilities that bear fixed interest rates. Midco’s finance costs are exposed to fluctuations in interest rates.
 
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The rates to which the Predecessor was most exposed in 2011 and 2012 were mainly the Euribor rate and the Brasilian CDI interbank rate.
Net finance expense increased by 16% from 11,082 thousand U.S. dollars to 12,903 thousand U.S. dollars in 2011 and 2012, respectively. Excluding exchange gains/losses, net finance expense amounted to 8,262 thousand U.S. dollars and 11,927 thousand U.S. dollars in 2011 and 2012, respectively.
At November 30, 2012, 90% of the total nominal debt bears a variable interest rate (92% at December 31, 2011).
Sensitivity analysis of interest rate risk:
The sensitivity of finance costs to changes in interest rates can be illustrated by calculating the impact of a 100 basis point increase in all interest rates of currencies in which there is a financial position at November 30, 2012, and assuming no change in currency composition of the closing position.
Credit risk:
The Predecessor’s maximum exposure to credit risk on financial assets is the carrying amount of the financial assets (see Note 9).
The Predecessor seeks to conduct all its business with renowned national and international companies and institutions of established solvency in their countries of origin, so as to minimize credit risk. As a result of this policy, the Predecessor has no material adjustments to make to its trade accounts (see Notes 9 & 10).
The Predecessor’s commercial credit risk management approach is based on continuous monitoring of the risk assumed and the financial resources necessary to manage the Predecessor’s various units, in order to optimize the risk-reward relationship in the development and implementation of their business plans in their ordinary management.
Credit risk arising from cash and cash equivalents is managed by placing cash surpluses in high quality and highly liquid money-market assets. These placements are regulated by a Master Agreement which is revised annually based on conditions of the market and countries where the Predecessor operates. The Master Agreement sets: (i) the maximum amounts to be invested by counterparty based on their ratings (long- and short-term debt rating); (ii) the maximum period of the investment; and (iii) the instruments in which the surpluses may be invested.
The Predecessor’s maximum exposure to credit risk is primarily represented by the carrying amounts of its financial assets.
Liquidity risk:
The Predecessor seeks to match its debt maturity schedule to its capacity to generate cash flows to meet the payments falling due, factoring in a degree of cushion. In practice, this has meant that the Predecessor’s debt maturity must be longer than the length of time required to pay its debt (assuming that internal projections are met).
At December 31, 2011, and November 30, 2012, the average term to maturity of the Predecessor’s gross financial debt (126,960 thousand U.S. dollars and 90,462 thousand U.S. dollars, respectively) was 3.42 and 1.88 years, respectively. At the same dates, current financial assets and cash and cash equivalents totalled 106,480 thousand U.S. dollars and 85,858 thousand U.S. dollars, respectively, sufficient to enable the Predecessor to service its payables in accordance with the maturity schedule.
 
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Capital Management:
The Predecessor’s finance department, which is in charge of capital management, takes into consideration several factors when determining the Predecessor’s capital structure, with the aim of ensuring sustainability of the business and maximizing the value to shareholders. The Predecessor monitors its cost of capital with a goal of optimizing its capital structure. In order to do this, the Predecessor monitors the financial markets and updates to standard industry approaches for calculating weighted average cost of capital, or WACC.
These general principles are refined by other considerations and the application of specific variables, such as country risk in the broadest sense, or the volatility in cash flow generation, when determining the Predecessor financial structure. Considering the nature of these combined carve-out financial statements described in Note 1, no specific ratio related to capital management has been presented.
Fair value estimation:
The table below analyses financial instruments carried at fair value, by valuation method. The different levels have been defined as follows:
 
 	•	 	Quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1).	
 
 	•	 	Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (Level 2).	
 
 	•	 	Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (Level 3).	
The following table presents the group’s assets and liabilities that are measured at fair value at 31 December 2011.

 	  	Thousands of U.S. dollars	 	
 	  	Level 1	 	  	Level 2	 	  	Level 3	 	  	Total	 	
Assets	  				  				  				  				
Derivatives (Note 9)	  	 	—	  	  	 	449	  	  	 	—	  	  	 	449	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total assets	  	 	—	  	  	 	449	  	  	 	—	  	  	 	449	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Liabilities	  				  				  				  				
Derivatives (Note 13)	  	 	—	  	  	 	2	  	  	 	—	  	  	 	2	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total liabilities	  	 	—	  	  	 	2	  	  	 	—	  	  	 	2	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
The following table presents the group’s assets and liabilities that are measured at fair value at 30 November 2012.

 	  	Thousands of U.S. dollars	 	
 	  	Level 1	 	  	Level 2	 	  	Level 3	 	  	Total	 	
Assets	  				  				  				  				
Derivatives	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total assets	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Liabilities	  				  				  				  				
Derivatives (Note 13)	  	 	—	  	  	 	1,000	  	  	 	—	  	  	 	1,000	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total liabilities	  	 	—	  	  	 	1,000	  	  	 	—	  	  	 	1,000	  	

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The fair value of financial instruments traded in active markets is based on quoted market prices at the balance sheet date. A market is regarded as active if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arm’s length basis.
The fair value of financial instruments that are not traded in an active market (for example, over-the-counter derivatives) is determined by using valuation techniques. These valuation techniques maximize the use of observable market data where it is available and rely as little as possible on entity specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.
Specific valuation techniques used to value financial instruments include:
 
 	•	 	The fair value of interest rate swaps is calculated as the present value of the estimated future cash flows based on observable yield curves;	
 
 	•	 	The fair value of forward foreign exchange contracts is determined using forward exchange rates at the balance sheet date, with the resulting value discounted back to present value;	
6. INTANGIBLE ASSETS
The breakdown, amount and movement in intangible assets for the year ended December 31, 2011 and for the eleven month period ended November 30, 2012 were as follows:

 	  	Thousands of U.S. dollars	 	
 	  	Balance at
12/31/2010	 	 	Additions	 	 	Decreases
or
Disposals	 	 	Transfers	 	 	Translation
differences	 	 	Balance at
12/31/2011	 	
Cost:	  				 				 				 				 				 				
Development costs	  	 	4	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	4	  	
Intellectual Property	  	 	—	  	 	 	20,931	  	 	 	—	  	 	 	—	  	 	 	(809	) 	 	 	20,122	  	
Computer software	  	 	134,087	  	 	 	16,157	  	 	 	(145	) 	 	 	2,002	  	 	 	(13,226	) 	 	 	138,875	  	
Other intangible assets	  	 	77,323	  	 	 	5,817	  	 	 	(11,335	) 	 	 	—	  	 	 	(4,261	) 	 	 	67,544	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total intangible assets	  	 	211,414	  	 	 	42,905	  	 	 	(11,480	) 	 	 	2,002	  	 	 	(18,296	) 	 	 	226,545	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Accumulated depreciation:	  				 				 				 				 				 				
Development costs	  	 	(4	) 	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	(4	) 	
Intellectual Property	  	 	—	  	 	 	(1,349	) 	 	 	—	  	 	 	—	  	 	 	94	  	 	 	(1,255	) 	
Computer software	  	 	(96,811	) 	 	 	(14,325	) 	 	 	100	  	 	 	(3	) 	 	 	9,262	  	 	 	(101,777	) 	
Other intangible assets	  	 	(7,021	) 	 	 	(10,760	) 	 	 	2,756	  	 	 	3	  	 	 	944	  	 	 	(14,078	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total accumulated depreciation	  	 	(103,836	) 	 	 	(26,434	) 	 	 	2,856	  	 	 	—	  	 	 	10,300	  	 	 	(117,114	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Software impairment losses	  	 	(45	) 	 	 	—	  	 	 	45	  	 	 	—	  	 	 	—	  	 	 	—	  	
Other intangible assets	  	 	—	  	 	 	(8,237	) 	 	 	—	  	 	 	—	  	 	 	524	  	 	 	(7,713	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total impairment losses	  	 	(45	) 	 	 	(8,237	) 	 	 	45	  	 	 	—	  	 	 	524	  	 	 	(7,713	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net intangible assets	  	 	107,533	  	 	 	8,234	  	 	 	(8,579	) 	 	 	2,002	  	 	 	(7,472	) 	 	 	101,718	  	

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 	  	Thousands of U.S. dollars	 	
 	  	Balance at
12/31/2011	 	 	Additions	 	 	Decreases
or
Disposals	 	 	Transfers	 	 	Translation
differences	 	 	Balance at
11/30/2012	 	
Cost:	  				 				 				 				 				 				
Development costs	  	 	4	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	4	  	
Intellectual Property	  	 	20,122	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	74	  	 	 	20,196	  	
Computer software	  	 	138,875	  	 	 	8,393	  	 	 	(1,722	) 	 	 	1,017	  	 	 	(5,576	) 	 	 	140,987	  	
In process	  	 	—	  	 	 	96	  	 	 	—	  	 	 	—	  	 	 	1	  	 	 	97	  	
Other intangible assets	  	 	67,544	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	(1,538	) 	 	 	66,006	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total intangible assets	  	 	226,545	  	 	 	8,489	  	 	 	(1,722	) 	 	 	1,017	  	 	 	(7,039	) 	 	 	227,290	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Accumulated depreciation:	  				 				 				 				 				 				
Development costs	  	 	(4	) 	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	(4	) 	
Intellectual Property	  	 	(1,255	) 	 	 	(1,598	) 	 	 	—	  	 	 	381	  	 	 	(20	) 	 	 	(2,492	) 	
Computer software	  	 	(101,777	) 	 	 	(15,382	) 	 	 	1,722	  	 	 	—	  	 	 	4,788	  	 	 	(110,649	) 	
Other intangible assets	  	 	(14,078	) 	 	 	(9,175	) 	 	 	—	  	 	 	(381	) 	 	 	441	  	 	 	(23,193	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total accumulated depreciation	  	 	(117,114	) 	 	 	(26,155	) 	 	 	1,722	  	 	 	—	  	 	 	5,209	  	 	 	(136,338	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Other intangibles assets	  	 	(7,713	)  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	(307	) 	 	 	(8,020	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total impairment losses	  	 	(7,713	) 	 	 	—	  	 	 	—	  	 	 	—	  	 	 	(307	) 	 	 	(8,020	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net intangible assets	  	 	101,718	  	 	 	(17,666	) 	 	 	—	  	 	 	1,017	  	 	 	(2,137	) 	 	 	82,932	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
2011
On May 3, 2011, the AIT Group and Telefónica Internacional, S.A.U. (“TISA”) agreed to extend the duration of the contracts signed on November 13, 2009 recognizing the combined entities as the exclusive supplier of customer analysis services for certain Telefónica Group companies in Latin America from 36 to 48 months. The original contract was signed on October 30, 2009 by Digitex Informática, S.L. (“Digitex”) and TISA by which Digitex hired the services of TISA to act as intermediary to obtain the right to be an exclusive supplier of the customer analysis services for several Telefónica Group companies in Latin America. Subsequently, on November 13, 2009, an agreement was signed with Digitex to transfer part of the rights acquired by Digitex, with the explicit agreement of TISA.
As a result, AIT Group acquired the right to be the exclusive supplier, through its subsidiaries in Central and South America, of 80% of the abovementioned customer analysis services for 12 Telefónica Group companies in Latin America (amounting to approximately 59,199 thousands U.S. dollars), which has been classified under “other intangible assets”.
This asset was assessed for impairment due to the existence of indicators of potential impairment. The asset was considered impaired and an impairment loss was recognized. Decreases to “Other intangible assets” relate entirely to the portion of the impairment considered irreversible, net of accumulated amortization, for 8,579 thousand U.S. dollars (see Note 19g).
The impairment losses balance reflects the remainder of the reversible impairment loss of the asset for 8,237 thousand U.S. dollars. This impact was recognized in the accompanying consolidated income statement under “Other operating expenses” (see Note 19g).
On September 30, 2011, Atento Teleservicios España, S.A.U. and Telefónica de España S.A.U. agreed to sell the business related to the 11822, 11825, and 1212 telephone information services for 48,611 thousand U.S. dollars (36,000 thousand euros) based on a valuation performed by a third party. The amount paid (48,611 thousand U.S. dollars) was allocated to intangible assets (25,136 thousands U.S. dollars), goodwill (31,016 thousands U.S. dollars) and deferred tax liabilities (7,541 thousands U.S. dollars).
 
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On May 24, 2011, the AIT Group acquired the Atento brand through a purchase-sale agreement with Telefónica, S.A. for the amount of 1,669 thousand U.S. dollars (1,200 thousand euros).
2012
Additions of intangible assets mainly relate to acquisitions of computer software for 8,393 thousand U.S. dollars.
The breakdown of fully depreciated items of intangibles still in use at December 31, 2011, and November 30, 2012 is as follows:

 	  	Thousands of U.S. dollars	 	
 	  	12/31/2011	 	  	11/30/2012	 	
Computer software and other intangible assets	  	 	57,789	  	  	 	56,067	  	
	  	 	 	 	  	 	 	 	
Total	  	 	57,789	  	  	 	56,067	  	
	  	 	 	 	  	 	 	 	
7. GOODWILL
The breakdown, amount, and movement of goodwill in the combined entities in 2011 and 2012 are as follows (in thousands of USD):

 	 	Balance at
01/01/11	 	 	Additions	 	 	Translation
differences	 	 	Balance at
12/31/11	 	 	Additions	 	 	Translation
differences	 	 	Balance at
11/30/12	 	
Atento Brasil, Ltda.	 	 	121,218	  	 	 	—	  	 	 	(13,544	) 	 	 	107,674	  	 	 	—	  	 	 	(11,834	) 	 	 	95,840	  	
Teleatento del Perú, S.A.C.	 	 	37,851	  	 	 	—	  	 	 	1,586	  	 	 	39,437	  	 	 	—	  	 	 	1,773	  	 	 	41,210	  	
Atento Teleservicios España, S.A.	 	 	6,462	  	 	 	31,016	  	 	 	(1,500	) 	 	 	35,978	  	 	 	—	  	 	 	131	  	 	 	36,109	  	
Atento Chile, S.A	 	 	620	  	 	 	—	  	 	 	(61	) 	 	 	559	  	 	 	—	  	 	 	45	  	 	 	604	  	
Atento Ceská Republika, a.s.	 	 	5,766	  	 	 	—	  	 	 	(343	) 	 	 	5,423	  	 	 	—	  	 	 	136	  	 	 	5,559	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	 	 	171,917	  	 	 	31,016	  	 	 	(13,862	) 	 	 	189,071	  	 	 	—	  	 	 	(9,749	) 	 	 	179,322	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
In the year ended December 31, 2011 and the eleven month period ended November 30, 2012 the movement of goodwill was due to translation differences affecting the initial amounts, and the purchase of the assets related to the 11822, 11825, and 1212 telephone information services businesses in an amount of 31,016 thousand U.S. dollars (See Note 6).
Regarding the impairment test of goodwill in accordance with IAS 36, Impairment of Assets, as of December 31, 2011 and as of November 30, 2012, judgments and estimates used to calculate the recoverable amount of goodwill as described in Note 3f indicate that the carrying amount of each item of goodwill is recoverable, based on the expected future cash flows from the CGU or groups of CGU to which they are allocated. The level of analysis performed by the Predecessor at a CGU level coincides with that performed at country level.
Cash flow forecasts are based on projected growth rates (average percentage is 2%) that are constant from year five. These tests are performed annually and whenever it is considered that the recoverable amount of goodwill may be impaired.
The estimated future cash flows are discounted to their present value using pre-tax discount rates, which factor in country and business risks and are applied as follows:

 	  	Discount rate	 	
U.S. dollars	  	Brazil	 	 	Chile	 	 	Spain	 	 	Peru	 	 	Czech Republic	 	
December 2011	  	 	12.66	% 	 	 	10.61	% 	 	 	10.87	% 	 	 	10.29	% 	 	 	8.88	% 	
November 2012	  	 	13.18	% 	 	 	11.28	% 	 	 	12.00	% 	 	 	10.29	% 	 	 	9.01	% 	
 
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The impairment tests conducted in 2011 and 2012 did not identify any impairment in the carrying value of goodwill, since the recoverable amount calculated based on value in use exceeded the carrying value, in all cases, of the related CGU.
The Predecessor has no intangible assets with indefinite useful life and therefore carries out no impairment tests of this type.
In addition, a sensitivity analysis was performed on changes that could reasonably be expected to occur in the principal measurement variables, and recoverable amount remains above the net carrying amount.
8. PROPERTY, PLANT AND EQUIPMENT
The breakdown, amount and movement in “Property, plant and equipment” in the year ended December 31, 2011 and the eleven month period ended November 30, 2012 were as follows:

 	  	Thousands of U.S. Dollars	 	
 	  	Balance at
12/31/2010	 	 	Additions	 	 	Decreases or
disposals	 	 	Transfers	 	 	Translation
differences	 	 	Balance at
12/31/2011	 	
Cost:	  				 				 				 				 				 				
Land and natural resources	  	 	70	  	 	 	—	  	 	 	(26	) 	 	 	—	  	 	 	(1	) 	 	 	43	  	
Buildings and leasehold improvements	  	 	4,504	  	 	 	7,478	  	 	 	(686	) 	 	 	—	  	 	 	(615	) 	 	 	10,681	  	
Plant, machinery and tools	  	 	53,056	  	 	 	1,909	  	 	 	(216	) 	 	 	747	  	 	 	(3,926	) 	 	 	51,570	  	
Furniture	  	 	519,684	  	 	 	84,973	  	 	 	(13,082	) 	 	 	5,138	  	 	 	(49,213	) 	 	 	547,500	  	
PP&E in progress	  	 	9,122	  	 	 	4,338	  	 	 	(129	) 	 	 	(7,887	) 	 	 	(263	) 	 	 	5,181	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total property, plant and equipment	  	 	586,436	  	 	 	98,698	  	 	 	(14,139	) 	 	 	(2,002	) 	 	 	(54,018	) 	 	 	614,975	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Accumulated depreciation:	  				 				 				 				 				 				
Buildings and leasehold improvements	  	 	(812	) 	 	 	(451	) 	 	 	327	  	 	 	—	  	 	 	47	  	 	 	(889	) 	
Plant, machinery and tools	  	 	(41,787	) 	 	 	(3,546	) 	 	 	29	  	 	 	(14	) 	 	 	3,115	  	 	 	(42,203	) 	
Furniture	  	 	(356,664	) 	 	 	(48,072	) 	 	 	10,914	  	 	 	14	  	 	 	30,635	  	 	 	(363,173	) 	
Total accumulated depreciation	  	 	(399,263	) 	 	 	(52,069	) 	 	 	11,270	  	 	 	—	  	 	 	33,797	  	 	 	(406,265	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Impairment losses on data processing	  				 				 				 				 				 				
Equipment	  	 	(36	) 	 	 	(297	) 	 	 	—	  	 	 	—	  	 	 	19	  	 	 	(314	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total impairment losses	  	 	(36	) 	 	 	(297	) 	 	 	—	  	 	 	—	  	 	 	19	  	 	 	(314	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net property, plant and equipment	  	 	187,137	  	 	 	46,332	  	 	 	(2,869	) 	 	 	(2,002	) 	 	 	(20,202	) 	 	 	208,396	  	

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 	  	Thousands of U.S. Dollars	 	
 	  	Balance at
12/31/2011	 	 	Additions	 	 	Decreases or
disposals	 	 	Transfers	 	 	Translation
differences	 	 	Balance at
11/30/2012	 	
Cost:	  				 				 				 				 				 				
Land and natural resources	  	 	43	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	43	  	
Buildings and leasehold improvements	  	 	10,681	  	 	 	609	  	 	 	—	  	 	 	(310	) 	 	 	40	  	 	 	11,020	  	
Plant, machinery and tools	  	 	51,570	  	 	 	420	  	 	 	(144	) 	 	 	(623	) 	 	 	2,792	  	 	 	54,015	  	
Furniture	  	 	547,500	  	 	 	53,538	  	 	 	(16,301	) 	 	 	4,609	  	 	 	(28,468	) 	 	 	560,878	  	
PP&E in progress	  	 	5,181	  	 	 	13,877	  	 	 	(47	) 	 	 	(4,692	) 	 	 	(881	) 	 	 	13,438	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total property, plant and equipment	  	 	614,975	  	 	 	68,444	  	 	 	(16,492	) 	 	 	(1,016	) 	 	 	(26,517	) 	 	 	639,394	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Accumulated depreciation:	  				 				 				 				 				 				
Buildings and leasehold improvements	  	 	(889	) 	 	 	(1,405	) 	 	 	—	  	 	 	—	  	 	 	(20	) 	 	 	(2,314	) 	
Plant, machinery and tools	  	 	(42,203	) 	 	 	(2,861	) 	 	 	55	  	 	 	—	  	 	 	(2,270	) 	 	 	(47,279	) 	
Furniture	  	 	(363,173	) 	 	 	(47,727	) 	 	 	14,157	  	 	 	—	  	 	 	17,320	  	 	 	(379,423	) 	
Total accumulated depreciation	  	 	(406,265	) 	 	 	(51,993	) 	 	 	14,212	  	 	 	—	  	 	 	15,030	  	 	 	(429,016	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Impairment losses on data processing equipment	  	 	(314	) 	 	 	(38	) 	 	 	26	  	 	 	—	  	 	 	(81	) 	 	 	(407	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total impairment losses	  	 	(314	) 	 	 	(38	) 	 	 	26	  	 	 	—	  	 	 	(81	) 	 	 	(407	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net property, plant and equipment	  	 	208,396	  	 	 	16,413	  	 	 	(2,254	) 	 	 	(1,016	) 	 	 	(11,568	) 	 	 	209,971	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Depreciation expense of 52,069 and 51,993 has been included in “Depreciation and amortization” in 2011 and 2012, respectively (see Note 19f).
The PP&E in progress balance is comprised of assets acquired but not placed in use as of December 31, 2011 and November 30, 2012.
PP&E includes the following amounts where the Predecessor is a lessee under a finance lease:

 	  	Thousands of U.S. dollars	 	
 	  	12/31/2011	 	 	11/30/2012	 	
Cost-capitalized finance lease	  	 	1,337	  	 	 	7,636	  	
Accumulated depreciation	  	 	(641	) 	 	 	(755	) 	
	  	 	 	 	 	 	 	 	
Net book amount	  	 	696	  	 	 	6,881	  	
	  	 	 	 	 	 	 	 	
The movements in the PP&E balance were due to the following transactions:
2011
The additions mainly relate to investments in Colombia, Spain and Argentina for the upgrade of equipment and to renovate and upgrade obsolete equipment at existing centers and bring it in line with customer requirements, and in Brazil and Peru to adapt new centers.
2012
In the eleven months ended November 30, 2012, investments amounting to 50,578 thousand U.S. dollars were made in furniture, plant and equipment in Brazil for the construction of the new “Uruguay Site” and to maintain business with customers in that country. Additions in Spain amounted to 6,262 thousand U.S. dollars to build centers in a number of places (e.g. Glorias, Bilbao, Perú) given the need for an increasing number of positions to meet customer demand.
 
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Disposals of assets relate mainly to replacements of old equipment with new equipment acquired under a finance lease.
The breakdown of fully depreciated items of property, plant and equipment still in use at December 31, 2011 and November 30, 2012 is as follows:

 	  	Thousands of U.S. Dollars	 	
 	  	12/31/2011	 	  	11/30/2012	 	
Plant machinery and tools	  	 	32,077	  	  	 	904	  	
Furniture and other	  	 	245,339	  	  	 	260,020	  	
	  	 	 	 	  	 	 	 	
Total	  	 	277,416	  	  	 	260,924	  	
	  	 	 	 	  	 	 	 	
The combined companies hold insurance policies to cover the potential risks related to property, plant and equipment used in operation.
9. FINANCIAL ASSETS
The breakdown of the Predecessor´s financial assets by category at December 31, 2011 and November 30, 2012 are as follows:

 	  	December 31, 2011	 	
 	  	Thousands of U.S. dollars	 	
 	  	Other financial
assets at fair value
through P&L	 	  	Loans,
receivables,
and other	 	  	Held-to
maturity
investments	 	  	Hedging
derivatives	 	  	Total	 	
Non-Current Financial Assets	  				  				  				  				  				
Loans	  	 	—	  	  	 	23	  	  	 	—	  	  	 	—	  	  	 	23	  	
Loans with related party (Note 23)	  	 	—	  	  	 	1,112	  	  	 	—	  	  	 	—	  	  	 	1,112	  	
Investments	  	 	—	  	  	 	3,291	  	  	 	—	  	  	 	—	  	  	 	3,291	  	
Deposits and guarantees given	  	 	—	  	  	 	47,326	  	  	 	—	  	  	 	—	  	  	 	47,326	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	—	  	  	 	51,752	  	  	 	—	  	  	 	—	  	  	 	51,752	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Current Financial Assets	  				  				  				  				  				
Trade and other receivables (excluding pre-payments)	  	 	—	  	  	 	481,415	  	  	 	—	  	  	 	—	  	  	 	481,415	  	
Short-term loans	  	 	—	  	  	 	21,698	  	  	 	—	  	  	 	—	  	  	 	21,698	  	
Deposits and guarantees	  	 	—	  	  	 	2,428	  	  	 	—	  	  	 	—	  	  	 	2,428	  	
Other short term financial instruments	  	 	—	  	  	 	—	  	  	 	—	  	  	 	449	  	  	 	449	  	
Cash and cash equivalents (Note 11)	  				  	 	81,905	  	  	 	—	  	  	 	—	  	  	 	81,905	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	—	  	  	 	587,446	  	  	 	—	  	  	 	449	  	  	 	587,895	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total financial assets	  	 	—	  	  	 	639,175	  	  	 	—	  	  	 	449	  	  	 	639,624	  	

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 	  	November 30, 2012	 	
 	  	Thousands of U.S. dollars	 	
 	  	Other financial
assets at fair value
through P&L	 	  	Loans,
receivables,
and other	 	  	Held-to
maturity
investments	 	  	Hedging
derivatives	 	  	Total	 	
Non-Current Financial Assets	  				  				  				  				  				
Loans	  	 	—	  	  	 	7,528	  	  	 	—	  	  	 	—	  	  	 	7,528	  	
Deposits and guarantees given	  	 	—	  	  	 	48,839	  	  	 	—	  	  	 	—	  	  	 	48,839	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	—	  	  	 	56,367	  	  	 	—	  	  	 	—	  	  	 	56,367	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Current Financial Assets	  				  				  				  				  				
Trade and other receivables (excluding pre-payments)	  	 	—	  	  	 	540,799	  	  	 	—	  	  	 	—	  	  	 	540,799	  	
Short-term loans	  	 	—	  	  	 	33,717	  	  	 	—	  	  	 	—	  	  	 	33,717	  	
Deposits and guarantees given	  	 	—	  	  	 	2,523	  	  	 	—	  	  	 	—	  	  	 	2,523	  	
Cash and cash equivalents (Note 11)	  	 	—	  	  	 	49,618	  	  	 	—	  	  	 	—	  	  	 	49,618	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	—	  	  	 	626,657	  	  	 	—	  	  	 	—	  	  	 	626,657	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total financial assets	  	 	—	  	  	 	683,024	  	  	 	—	  	  	 	—	  	  	 	683,024	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
The categories in this disclosure are determined by IAS 39, Financial Instruments: Recognition and Measurement (“IAS 39). The breakdown presented excludes pre-payments from the ‘trade and other receivables’ balance of 3,519 and 5,511 thousand U.S. dollars for 2011 and 2012, respectively, as this analysis is required only for financial instruments.
The balances of “Deposits and guarantees given” at December 31, 2011 and at November 30, 2012 mainly include deposits posted with the courts in respect of legal disputes with employees by subsidiary Atento Brasil, S.A. and for litigation underway with the Brazilian social security authority, the “Instituto Nacional do Seguro Social” (INSS—see Note 17).
Within “Current financial assets”, at December 31, 2011 and at November 30, 2012, “short-term loans” totaled 21,698 and 33,717 thousand U.S. dollars, respectively, comprising primarily of short-term balances on deposits in Brazilian banks (21,311 and 33,713 thousand U.S. dollars, respectively), which accrued in both periods an average interest rate of approximately 11%.
The Predecessor mainly conducts transactions with the Telefónica Group and BBVA. Financial asset fair value approximates the related book value as such the credit risk mainly relates to the book value of the financial assets.
 
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10. TRADE AND OTHER RECEIVABLES
The breakdown of “Trade and other receivables” at December 31, 2011 and November 30, and 2012 is as follows:

 	  	Thousands of U.S. dollars	 	
 	  	Balance at
12/31/2011	 	 	Balance at
11/30/2012	 	
Trade receivables from third parties	  	 	210,359	  	 	 	226,191	  	
	  	 	 	 	 	 	 	 	
Receivable from Related Parties	  	 	253,671	  	 	 	307,815	  	
Sundry receivables from Related Parties	  	 	2,610	  	 	 	4,341	  	
	  	 	 	 	 	 	 	 	
Total receivables from Related Parties (Note 23)	  	 	256,281	  	 	 	312,156	  	
	  	 	 	 	 	 	 	 	
Other receivables	  	 	7,760	  	 	 	9,990	  	
Receivable from employees	  	 	10,775	  	 	 	11,331	  	
Prepayments of current expenses	  	 	3,519	  	 	 	5,511	  	
Impairment allowances	  	 	(3,760	) 	 	 	(18,869	) 	
	  	 	 	 	 	 	 	 	
Trade and other receivables	  	 	484,934	  	 	 	546,310	  	
	  	 	 	 	 	 	 	 	
The amounts and breakdown of “Trade receivables from third parties” at December 31, 2011 and November 30, 2012 are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	Balance at
12/31/2011	 	  	Balance at
11/30/2012	 	
Receivables billed	  	 	140,858	  	  	 	150,416	  	
Receivables unbilled	  	 	69,501	  	  	 	75,775	  	
	  				  	 	—	  	
	  	 	 	 	  	 	 	 	
Trade receivables	  	 	210,359	  	  	 	226,191	  	
	  	 	 	 	  	 	 	 	
The amounts and breakdown of “Receivable from Related parties” at December 31, 2011 and November 30, 2012 are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	Balance at
12/31/2011	 	  	Balance at
11/30/2012	 	
Receivables billed	  	 	162,156	  	  	 	154,914	  	
Receivables unbilled	  	 	91,515	  	  	 	152,901	  	
	  	 	 	 	  	 	 	 	
Receivable from Related Parties	  	 	253,671	  	  	 	307,815	  	
	  	 	 	 	  	 	 	 	
Receivables unbilled represent revenue for which services have been rendered but remain unbilled due to the timing of when the services are rendered and billed. The book value of trade and other receivables approximates fair value.
 
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The breakdown of movements in “Impairment allowances” in 2011 and 2012 is as follows:

 	  	Thousands of
U.S. dollars	 	
Impairment allowances at 12/31/2010	  	 	(3,967	) 	
	  	 	 	 	
Allowances	  	 	(3,282	) 	
Reversals	  	 	592	  	
Applications	  	 	2,543	  	
Translation differences	  	 	354	  	
	  	 	 	 	
Impairment allowances at 12/31/2011	  	 	(3,760	) 	
	  	 	 	 	
Allowances	  	 	(13,945	) 	
Reversals	  	 	—	  	
Applications	  	 	(939	) 	
Translation differences	  	 	(225	) 	
	  	 	 	 	
Impairment allowances at 11/30/2012	  	 	(18,869	) 	
	  	 	 	 	
The ageing of receivables for 2011 and 2012 is as follows

 	  	Thousands of U.S. dollars	 	  	Amount due	 	
 	  	Balance at
12/31/2011	 	  	Amount not yet
due	 	  	Up to 90
days	 	  	90 – 180
days	 	  	180 – 360
days	 	  	More than 360
days	 	
Receivables billed	  	 	140,858	  	  	 	79,837	  	  	 	41,952	  	  	 	11,358	  	  	 	5,821	  	  	 	1,890	  	

 	  	Balance at
11/30/2012	 	  	Amount not yet
due	 	  	Up to 90
days	 	  	90 – 180
days	 	  	180 – 360
days	 	  	More than 360
days	 	
Receivables billed	  	 	150,416	  	  	 	101,533	  	  	 	31,229	  	  	 	14,134	  	  	 	525	  	  	 	2,995	  	
As of November 30, 2012, the amount of the provision was 18,869 thousands of U.S. dollars (2011: 3,760 thousands of U.S. dollars).
The maximum exposure to credit risk at the reporting date is the carrying value of each class of receivables mentioned above. The Predecessor does not hold any collateral as security.
Receivables from employees are mainly comprised of salary advances to employees of the combined entities.
11. CASH AND CASH EQUIVALENTS
The breakdown of cash held is as follows:

 	  	Thousands of U.S. dollars	 	
 	  	Balance at
12/31/2011	 	  	Balance at
11/30/2012	 	
Cash at bank and in hand	  	 	81,905	  	  	 	49,618	  	
Cash equivalents	  	 	—	  	  	 	—	  	
	  	 	 	 	  	 	 	 	
Cash and cash equivalents	  	 	81,905	  	  	 	49,618	  	
	  	 	 	 	  	 	 	 	
All cash and cash equivalent balances at combined entities comprising the Predecessor are available for use without restriction.
 
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12. FINANCIAL LIABILITIES
The breakdown of the Predecessor´s financial liabilities by category at December 31, 2011 and November 30, 2012 is as follows:

 	  	December 31, 2011	 	
 	  	Thousands of U.S. dollars	 	
 	  	Liabilities at fair
value through
P&L	 	  	Derivatives
used for
hedging	 	 	Other financial
liabilities at
amortized cost	 	  	Total	 	
Non-Current Financial Liabilities	  				  				 				  				
Bank Borrowings	  	 	—	  	  	 	—	  	 	 	111,588	  	  	 	111,588	  	
Derivative financial instruments	  	 	—	  	  	 	336	  	 	 	—	  	  	 	336	  	
Other non-trade payables	  	 	—	  	  	 	—	  	 	 	65	  	  	 	65	  	
	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	
Total	  	 	—	  	  	 	336	  	 	 	111,653	  	  	 	111,989	  	
	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	
Current Financial Liabilities	  				  				 				  				
Bank Borrowings	  	 	—	  	  	 	—	  	 	 	15,370	  	  	 	15,370	  	
Derivative financial instruments	  	 	—	  	  	 	(334	) 	 	 	—	  	  	 	(334	) 	
Other non-trade payables	  	 	—	  	  	 	—	  	 	 	68,763	  	  	 	68,763	  	
Trade payables	  	 	—	  	  	 	—	  	 	 	103,174	  	  	 	103,174	  	
	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	
Total	  	 	—	  	  	 	(334	) 	 	 	187,307	  	  	 	186,973	  	
	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	
Total financial liabilities	  	 	—	  	  	 	2	  	 	 	298,960	  	  	 	298,962	  	

																	
 	  	November 30, 2012	 	
 	  	Thousands of U.S. dollars	 	
 	  	Liabilities at fair
value through
P&L	 	  	Derivatives
used for
hedging	 	  	Other financial
liabilities at
amortized cost	 	  	Total	 	
Non-Current Financial Liabilities	  				  				  				  				
Bank Borrowings	  	 	—	  	  	 	—	  	  	 	74,607	  	  	 	74,607	  	
Derivative financial instruments	  	 	—	  	  	 	819	  	  	 	—	  	  	 	819	  	
Other non-trade payables	  	 	—	  	  	 	—	  	  	 	56	  	  	 	56	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	—	  	  	 	819	  	  	 	74,663	  	  	 	75,482	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Current Financial Liabilities	  				  				  				  				
Bank Borrowings	  	 	—	  	  	 	—	  	  	 	12,834	  	  	 	12,834	  	
Derivative financial instruments	  	 	—	  	  	 	183	  	  	 	—	  	  	 	183	  	
Other non-trade payables	  	 	—	  	  	 	—	  	  	 	45,269	  	  	 	45,269	  	
Trade payables	  	 	—	  	  	 	—	  	  	 	103,826	  	  	 	103,826	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	—	  	  	 	183	  	  	 	161,929	  	  	 	162,112	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total financial liabilities	  	 	—	  	  	 	1,002	  	  	 	236,592	  	  	 	237,594	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
The categories in this disclosure are determined by IAS 39.
 
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13. INTEREST-BEARING DEBT AND DERIVATIVES
Interest-bearing debt and derivatives at December 31, 2011 and November 30, 2012 was as follows:

 	  	Thousands of U.S. dollars	 	
 	  	December 31, 2011	 	 	November 30, 2012	 	
Current	  				 				
Foreign-currency loans	  	 	8,856	  	 	 	12,489	  	
U.S. dollar loans	  	 	6,514	  	 	 	345	  	
Financial instruments—Derivatives (note 12)	  	 	(334	) 	 	 	183	  	
	  	 	 	 	 	 	 	 	
Total current interest-bearing debt	  	 	15,036	  	 	 	13,017	  	
	  	 	 	 	 	 	 	 	
Non-Current	  				 				
Foreign-currency loans	  	 	110,927	  	 	 	74,134	  	
U.S. dollar loans	  	 	661	  	 	 	473	  	
Financial instruments—Derivatives (note 12)	  	 	336	  	 	 	819	  	
	  	 	 	 	 	 	 	 	
Total non-current interest-bearing debt	  	 	111,924	  	 	 	75,426	  	
	  	 	 	 	 	 	 	 	
Total loans	  	 	126,960	  	 	 	88,443	  	
	  	 	 	 	 	 	 	 	
The loans listed above mature until 2016 and bear interest at an average rate of 2.90% (2011: 4.14%).
Derivatives are represented by interest rate swaps and they are held to hedge interest rate risk associated to the syndicated credit facility in euros described below. The notional amount of such derivatives is 35,709 thousands Euros.
The exposure of the group’s borrowings based on the maturity date at the end of the reporting period is as follows:

 	  	Thousands of U.S. dollars	 	
 	  	December 31, 2011	 	  	November 30, 2012	 	
1 year or less	  	 	15,036	  	  	 	13,017	  	
1 to 2 years	  	 	11,831	  	  	 	73,147	  	
2 to 3 years	  	 	5,249	  	  	 	2,090	  	
3 to 4 years	  	 	94,542	  	  	 	189	  	
Over 5 years	  	 	302	  	  	 	—	  	
	  	 	 	 	  	 	 	 	
	  	 	126,960	  	  	 	88,443	  	
	  	 	 	 	  	 	 	 	
The carrying amounts and fair value of the borrowings are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	Carrying amount	 	  	Fair value	 	
 	  	December 31, 2011	 	  	November 30, 2012	 	  	December 31, 2011	 	  	November 30, 2012	 	
Foreign-currency loans	  	 	119,783	  	  	 	86,625	  	  	 	119,783	  	  	 	86,625	  	
U.S. dollar loans	  	 	7,175	  	  	 	818	  	  	 	7,175	  	  	 	818	  	
Financial instruments—Derivatives (note 12)	  	 	2	  	  	 	1,000	  	  	 	2	  	  	 	1,000	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total loans	  	 	126,960	  	  	 	88,443	  	  	 	126,960	  	  	 	88,443	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
The fair value hierarchy of the borrowings is level 2. The fair value methodology used for the disclosure of fair value is based on discounted cash flows.
 
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U.S. dollar loans
 
 	•	 	On November 16, and December 9, 2010, Atento Brasil, S.A. arranged loans with Bradesco. The amount of loans were 5,834 and 19,905 thousands of U.S. dollars, respectively. These loans matured on November 11, and December 5, 2011, respectively. The interest rates applicable to these loans were 11.44% and 11.85%, respectively. On November 11, 2011, an extension to one loan was granted by Bradesco. The loan was for 5,834 thousands U.S. dollars, matured on November 5, 2012, and had interest of 11.26%.	
 
 	•	 	U.S. dollar loans also include a finance lease for 651 thousands of U.S. dollar held by Woknal, S.A. which commenced on October 2010 and matures on April 2014.	
An overview of the foreign-currency loans outstanding at December 31, 2011 and November 30, 2012 is given below:

 	  	Outstanding balance at December 31, 2011
(in thousands of local currency and U.S. dollars)	 	
 	  	Local currency	 	  	Underlying debt in
dollars	 	  	Derivatives
committed in
dollars (*)	 	  	Total	 	
EUR	  	 	81,196	  	  	 	105,060	  	  	 	—	  	  	 	105,060	  	
MAD	  	 	21,200	  	  	 	2,464	  	  	 	—	  	  	 	2,464	  	
COP	  	 	10,961,873	  	  	 	5,643	  	  	 	—	  	  	 	5,643	  	
CLP	  	 	82,234	  	  	 	158	  	  	 	—	  	  	 	158	  	
ARS	  	 	27,839	  	  	 	6,458	  	  	 	—	  	  	 	6,458	  	
	  				  	 	 	 	  	 	 	 	  	 	 	 	
Total	  				  	 	119,783	  	  	 	—	  	  	 	119,783	  	
	  				  	 	 	 	  	 	 	 	  	 	 	 	
Euro loans
 
 	•	 	On March 29, 2011, Atento, N.V. and Atento Teleservicios España, S.A.U., entered into a syndicated credit facility with Banco Santander, S.A. and HSBC Bank plc. The loan comprises two separate facilities. Facility A is a term loan which will be repaid in installments of 15% at the end of 2012, 20% at the end of 2013, 25% at the end of 2014 and the remaining 40% at March 29, 2015, while all amounts under Facility B shall be repaid on the last day of each interest period unless they are refinanced on such date by means of a new loan entered into under Facility B, the aggregate amount of which being equal to or less than the maturing amount borrowed under Facility B due for repayment until the final maturity date, which is March 29, 2015. The maturity schedule is as follows:	

Year	  	Tranche A	 	  	Tranche B	 	
Current	  	 	2,845	  	  	 	—	  	
Non-current	  	 	80,866	  	  	 	21,349	  	
	  	 	83,711	  	  	 	21,349	  	

 	•	 	The interest rate for each period is the annual rate calculated by adding the spread applicable at any given time under the terms of the credit facility agreement and the EURIBOR rate at a term equivalent to the interest period agreed at all times. The interest on the syndicated credit facility is linked to the EURIBOR rate plus a spread ranging from 1.60% to 2.10% based on compliance with the net financial debt/EBITDA ratio.	
 
 	•	 	The commitments and obligations of the parties are those ordinarily assumed in syndicated financing transactions. Some of the financing arranged by Atento is subject to compliance with certain financial covenants on consolidated figures. All the covenants were being complied with at the date of preparation of these combined carve-out financial statements.	
 
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 	•	 	This credit facility is guaranteed by other Atento companies (the “Guarantors”). At the date of these combined carve-out financial statements, the Guarantors are Atento Brasil, S.A. and Atento Mexicana, S.A. de C.V.	
Other foreign-currency loans
 
 	•	 	On February 28, 2011, Atento Colombia, S.A. arranged a loan with BBVA Colombia for 15,700,000 thousand Colombian pesos, maturing on February 28, 2013. Applicable interest is DTF plus a spread of 1.8%. The loan was pre-paid on November 28, 2012. The amount of this loan as of December 31, 2011 was 4,969 thousands U.S. dollars.	
 
 	•	 	On July 21, 2011, Atento Colombia, S.A. arranged a loan with BBVA Colombia for 1,800,000 thousand Colombian pesos. The loan matured and was repaid on July 19, 2012 and had interest of DTF plus a spread of 2.5%. The amount of this loan as of December 31, 2011 was 673 thousands U.S. dollars.	
 
 	•	 	On April 15, 2011, Microcentro, S.A. arranged a loan with HSBC Argentina, S.A. for 8,000 thousand Argentinean pesos, maturing on April 12, 2013, with interest of 19%. This loan was pre-paid on November 28, 2011.	
 
 	•	 	On April 15, 2011, Centro de Contactos Salta arranged a loan with HSBC Argentina, S.A. for 18,300 thousand Argentinean pesos, maturing on April 12, 2013, with interest of 19%. This loan was pre-paid on November 28, 2011.	
 
 	•	 	On June 28, 2011, Atento Marruecos, S.A. arranged a loan with Banco Sabadell, for 21,200 thousand dirham, maturing on June 28, 2016, with interest of 6%. A portion of this loan of 10,000 dirham was pre-paid November 2012. As of November 30, 2012 this loan had an outstanding balance of 879 thousand U.S. dollars (2,464 U.S. dollars as of December 31, 2011).	
 
 	•	 	Other foreign currency loans include a finance lease held by Atento Chile, S.A. which was cancelled on November 2013. As of November 30, 2012 this loan had an outstanding balance of 74 thousands U.S. dollars (158 thousands U.S. dollars as of December 31, 2011).	

 	  	Outstanding balance at November 30, 2012
(in thousands of local currency and U.S. dollars)	 	
 	  	Local currency	 	  	Underlying debt in
dollars	 	  	Derivatives
committed in
dollars (*)	 	  	Total	 	
EUR	  	 	60,659	  	  	 	78,770	  	  	 	—	  	  	 	78,770	  	
BRL	  	 	14,540	  	  	 	6,900	  	  	 	—	  	  	 	6,900	  	
MAD	  	 	7,547	  	  	 	879	  	  	 	—	  	  	 	879	  	
CLP	  	 	35,621	  	  	 	74	  	  	 	—	  	  	 	74	  	
	  				  				  	 	—	  	  				
Total	  				  	 	86,623	  	  	 	—	  	  	 	86,623	  	

 	•	 	On January 2, 2012, Atento Brasil, S.A. arranged a loan with Banco Santander for 30,000 thousand Brazilian reais. It matures on January 2, 2014 and bears interest at 112.8% of the CDI. This loan was pre-paid on November 2012.	
 
 	•	 	On March 1, 2012, Atento Brasil, S.A. arranged a loan with Banco Santander for 40,000 thousand Brazilian reais, maturing on January 2, 2014 and bearing interest at 112.5% of the CDI. This loan was pre-paid on November 2012.	
 
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14. OTHER NON-TRADE PAYABLES
The breakdown of “Other non-trade payables” in 2011 and 2012 is as follows:

 	  	Thousands of U.S. dollars	 	
 	  	Balance at
12/31/2011	 	  	Balance at
11/30/2012	 	
Current	  				  				
Wages and salaries payable	  	 	112,687	  	  	 	138,573	  	
Payables to suppliers of property, plant and Equipment	  	 	57,996	  	  	 	36,434	  	
Other non-trade payables	  	 	8,546	  	  	 	2,965	  	
Other non-trade payables to related parties	  	 	2,221	  	  	 	5,870	  	
Deferred income	  	 	470	  	  	 	796	  	
	  	 	 	 	  	 	 	 	
Total other non-trade payables	  	 	181,920	  	  	 	184,638	  	
	  	 	 	 	  	 	 	 	
Non-current	  				  				
Other payables	  	 	65	  	  	 	56	  	
Deferred income	  	 	33	  	  	 	21	  	
	  	 	 	 	  	 	 	 	
Total other non-trade payables	  	 	98	  	  	 	77	  	
	  	 	 	 	  	 	 	 	
“Non-current other payables” mainly includes amounts owed to public administrations by Atento Brasil, S.A. and deferred income is primarily composed of government grants.
15. TRADE PAYABLES
The breakdown of “Trade payables” at December 31, 2011 and November 30, 2012, is as follows:

 	  	Thousands of U.S. dollars	 	
 	  	Balance at
12/31/2011	 	  	Balance at
11/30/2012	 	
Current	  				  				
Payable on purchases	  	 	75,121	  	  	 	58,088	  	
Other trade payable to related parties	  	 	28,027	  	  	 	29,566	  	
Advances received	  	 	26	  	  	 	9,006	  	
Other trade payable	  	 	—	  	  	 	7,166	  	
	  	 	 	 	  	 	 	 	
Total	  	 	103,174	  	  	 	103,826	  	
	  	 	 	 	  	 	 	 	
At November 30, 2012, advances received of 9,006 thousand U.S. dollars represent cash received from the Telefónica Group for client services to be performed.
16. NON-CONTROLLING INTERESTS
In 2011 and 2012, changes recognized in non-controlling interests (NCI) were as follows:

 	  	Thousands of U.S. dollars	 	
Company (non-controlling interest)	  	Balance at
12/31/2010	 	 	Profit for
the year	 	 	Dividends
paid	 	  	Transfers	 	  	Translation
differences	 	 	Balance at
12/31/2011	 	
Atento Chile, S.A. (Telefónica Chile)	  	 	13,872	  	 	 	2,356	  	 	 	—	  	  	 	—	  	  	 	(1,462	) 	 	 	14,766	  	
Atento Centro de Formación	  	 	94	  	 	 	(4	) 	 	 	—	  	  	 	—	  	  	 	(4	) 	 	 	86	  	
Atento Educación Limitada (Telefónica Chile)	  	 	(294	) 	 	 	45	  	 	 	—	  	  	 	—	  	  	 	(45	) 	 	 	(294	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	
Total	  	 	13,672	  	 	 	2,397	  	 	 	—	  	  	 	—	  	  	 	(1,511	) 	 	 	14,558	  	

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 	  	 	 	 	Thousands of U.S. dollars	 	
Company (non-controlling interest)	  	Balance at
12/31/2011	 	 	Profit for
the year	 	  	Dividends
paid	 	 	Transfers	 	  	Translation
differences	 	 	Acquisition
of NCI	 	 	Balance at
11/30/2012	 	
Atento Chile, S.A. (Telefónica Chile)	  	 	14,766	  	 	 	361	  	  	 	(5,790	) 	 	 	—	  	  	 	1,181	  	 	 	(10,518	) 	 	 	—	  	
Atento Centro de Formación	  	 	86	  	 	 	—	  	  	 	—	  	 	 	—	  	  	 	2	  	 	 	(88	) 	 	 	—	  	
Atento Educación Limitada (Telefónica Chile)	  	 	(294	) 	 	 	46	  	  	 	—	  	 	 	—	  	  	 	(107	) 	 	 	355	  	 	 	—	  	
	  	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
Total	  	 	14,558	  	 	 	407	  	  	 	(5,790	) 	 	 	—	  	  	 	1,076	  	 	 	(10,251	) 	 	 	—	  	
	  	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
17. PROVISIONS AND CONTINGENCIES
The amounts of and changes in current and non-current provisions for the year ended December 31, 2011 and the eleven month period ended November 30, 2012 are as follows:

 	  	Balance at
12/31/2010	 	  	Increases	 	  	Decreases	 	 	Unwinding
Discount	 	 	Transfers	 	 	Translation
differences	 	 	Balance at
12/31/2011	 	
Non-current	  				  				  				 				 				 				 				
Provision for employee benefits	  	 	—	  	  	 	197	  	  	 	(586	) 	 	 	—	  	 	 	902	  	 	 	(57	) 	 	 	456	  	
Provision for tax	  	 	—	  	  	 	24	  	  	 	—	  	 	 	—	  	 	 	—	  	 	 	(1	) 	 	 	23	  	
Provision for dismantling	  	 	9,949	  	  	 	2,077	  	  	 	—	  	 	 	1,077	  	 	 	—	  	 	 	(1,419	) 	 	 	11,684	  	
Provisions for other claims	  	 	33	  	  	 	347	  	  	 	—	  	 	 	—	  	 	 	—	  	 	 	(25	) 	 	 	355	  	
	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	 	9,982	  	  	 	2,645	  	  	 	(586	) 	 	 	1,077	  	 	 	902	  	 	 	(1,502	) 	 	 	12,518	  	
	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Current	  				  				  				 				 				 				 				
Provision for employee benefits	  	 	—	  	  	 	1,488	  	  	 	—	  	 	 	—	  	 	 	—	  	 	 	(103	) 	 	 	1,385	  	
Provision for employee claims	  	 	—	  	  	 	18,050	  	  	 	(24,664	) 	 	 	(2,908	) 	 	 	30,629	  	 	 	(1,431	) 	 	 	19,676	  	
Provision for tax	  	 	—	  	  	 	793	  	  	 	—	  	 	 	—	  	 	 	—	  	 	 	16	  	 	 	809	  	
Provision for dismantling	  	 	1,201	  	  	 	270	  	  	 	(431	) 	 	 	144	  	 	 	—	  	 	 	(132	) 	 	 	1,052	  	
Provisions for other claims	  	 	4,891	  	  	 	225	  	  	 	(175	) 	 	 	1	  	 	 	(4,229	) 	 	 	(180	) 	 	 	533	  	
Other provisions	  	 	6,830	  	  	 	8	  	  	 	(859	) 	 	 	—	  	 	 	(5,175	) 	 	 	(182	) 	 	 	622	  	
	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Total	  	 	12,922	  	  	 	20,834	  	  	 	(26,129	) 	 	 	(2,763	) 	 	 	21,225	  	 	 	(2,012	) 	 	 	24,077	  	

																													
 	  	Balance at
12/31/2011	 	  	Increases	 	  	Decreases	 	 	Unwinding
Discount	 	  	Transfers	 	  	Translation
differences	 	 	Balance at
11/30/2012	 	
Non-current	  				  				  				 				  				  				 				
Provision for employee benefits	  	 	456	  	  	 	3,069	  	  	 	—	  	 	 	—	  	  	 	—	  	  	 	(177	) 	 	 	3,348	  	
Provision for tax	  	 	23	  	  	 	4,950	  	  	 	—	  	 	 	297	  	  	 	—	  	  	 	(421	) 	 	 	4,849	  	
Provision for dismantling	  	 	11,684	  	  	 	5,127	  	  	 	(208	) 	 	 	—	  	  	 	—	  	  	 	(1,600	) 	 	 	15,003	  	
Other provisions	  	 	355	  	  	 	—	  	  	 	—	  	 	 	—	  	  	 	—	  	  	 	—	  	 	 	355	  	
	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	
Total	  	 	12,518	  	  	 	13,146	  	  	 	(208	) 	 	 	297	  	  	 	—	  	  	 	(2,198	) 	 	 	23,555	  	
	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	
Current	  				  				  				 				  				  				 				
Provision for employee benefits	  	 	1,385	  	  	 	—	  	  	 	(1,372	) 	 	 	—	  	  	 	—	  	  	 	(13	) 	 	 	—	  	
Provision for employee claims	  	 	19,676	  	  	 	19,610	  	  	 	(15,219	) 	 	 	2,132	  	  	 	—	  	  	 	(2,499	) 	 	 	23,700	  	
Provision for tax	  	 	809	  	  	 	95	  	  	 	(27	) 	 	 	—	  	  	 	—	  	  	 	38	  	 	 	915	  	
Provision for dismantling	  	 	1,052	  	  	 	—	  	  	 	(988	) 	 	 	—	  	  	 	—	  	  	 	(36	) 	 	 	28	  	
Provisions for other claims	  	 	533	  	  	 	85	  	  	 	(124	) 	 	 	—	  	  	 	—	  	  	 	(56	) 	 	 	438	  	
Other provisions	  	 	622	  	  	 	4,329	  	  	 	(650	) 	 	 	—	  	  	 	—	  	  	 	60	  	 	 	4,361	  	
	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	
Total	  	 	24,077	  	  	 	24,119	  	  	 	(18,380	) 	 	 	2,132	  	  	 	—	  	  	 	(2,506	) 	 	 	29,442	  	

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Increases and decreases in this caption during 2012 correspond mainly to the provisions for employee claims and to the provisions for other claims in Brazil and Argentina in the amounts of 12,769 and a decrease of 9,439 thousand U.S. dollars, and 6,926 and a decrease of 5,791 thousand U.S. dollars, respectively. Additionally, the amount registered in “Transfers” in 2011 is related to a reclassification recorded from the account “Trade and other payables” to this heading.
The balance of this provision at November 30, 2012 is mainly comprised of an amount of 12,426 thousand U.S. dollars corresponding to Brazil (7,784 thousand U.S. dollars at December 31, 2011), and 10,399 thousand U.S. dollars corresponding to Argentina (2011: 10,496 thousand U.S. dollars).
Given the nature of the risks covered by these provisions, it is not possible to determine a reliable schedule of potential payments.
Current and non-current provisions for dismantling mainly include the provision for the dismantling of Atento Brasil, S.A. for the amount of 14,266 thousand U.S. dollars (2011: 12,264 thousand U.S. dollars).
Details of ongoing litigation as of November 30, 2012 are described in the following paragraphs.
In relation to Atento Brasil’s ongoing litigation with the Brazilian Social Security Authorities (INSS) and the Regional Labor Department (classified in 2010 as remote risk), for the payment in cash for transport passes to employees, in December 2011 binding decision (súmula) number 60 was handed down establishing that the amount paid in cash to employees in connection with “transport passes” is exempt from social security contributions. This decision is binding for both the administrative and legal authorities, and implies a favorable result for Atento Brasil in relation to all ongoing litigation. Although at the preparation date of the combined carve-out financial statements, the court’s final decision on the INSS litigation is still pending, Atento Brasil’s position has resulted favorable in all instances and therefore the risk associated to this litigation has been evaluated as possible.
At November 30, 2012 Atento Brasil was involved in approximately 8,031 labor-related disputes, filed by the Predecessor´s employees or ex-employees for various reasons, including dismissals or differences over employment conditions in general. The total amount of these claims is 281,744 thousand U.S. dollars, with possible claims, as classified by the Company’s internal and external lawyers, totalling 82,287 thousand U.S. dollars. For the most part, the further along the legal proceedings in this type of case in Brazil, the more remote the possible risk. Taking account of the amount of litigation that arises in Brazil and past experience in this type of claim, the Company has recognized provisions at November 30, 2012 amounting to 12,426 thousand U.S. dollars, which in the opinion of its directors based in part on the advice of legal advisors is sufficient to cover the risk of payments likely to be made because of these claims.
Additionally, as of November 30, 2012, Atento Brasil has 28 lawsuits ongoing with the Tax Authorities and Social Security Department for various reasons relating to infraction proceedings filed. The total amount of these claims is approximately 31,171 thousand U.S. dollars, and according to the Company’s external lawyers, the risk of materialization is possible.
Lastly, Atento Brasil has 21 civil lawsuits in progress relating to different causes. The total amount of these claims is approximately 6,721 thousand U.S. dollars, for which, according to the Company’s external lawyers, the risk of materialization is possible.
At November 30, 2012, Teleatento del Perú had a pending lawsuit against the Peruvian tax authority (Administración Tributaria Peruana) in the amount of 10,885 thousand U.S. dollars, for which, according to the Company’s external lawyers, the risk of materialization is possible.
 
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18. TAX MATTERS
The breakdown of the Predecessor’s income tax expense is as follows:

 	  	Thousands of U.S. dollars	 	
 	  	    2011    	 	  	    2012    	 	
Current tax:	  				  				
Current tax expense	  	 	54,310	  	  	 	61,989	  	
Adjustment in respect to prior years	  	 	206	  	  	 	305	  	
	  	 	 	 	  	 	 	 	
Total current tax	  	 	54,516	  	  	 	62,294	  	
	  	 	 	 	  	 	 	 	
Total deferred tax	  	 	340	  	  	 	(1,588	) 	
	  	 	 	 	  	 	 	 	
Total income tax expense	  	 	54,856	  	  	 	60,706	  	
	  	 	 	 	  	 	 	 	
The effective tax rate paid by the Predecessor is 37.97% at December 31, 2011 and 40.24% at November 30, 2012. If we analyze the aggregated effective tax rate not considering the holding companies, the effective tax rate will approximate 38% and 33% at December 31, 2011 and November 30, 2012, respectively, which are deemed reasonable effective tax rates. Further, the calculated tax rate is within the Predecessor’s range of reasonable parameters given that the official standard rates applicable to the main the Predecessor combined companies range from 28% to 47%. As there are no significant permanent differences, it was not considered necessary to provide further disclosures on the reconciliation of accounting and tax profit other than the changes in deferred taxes outlined below.
The combined entities file taxes separately in accordance with the tax legislation of their respective countries of incorporation.
The years open for review by the tax inspection authorities for the main taxes applicable vary from one company to another, based on each country’s tax legislation, taking into account their respective statute-of-limitations periods. The Predecessor´s management considers that no significant contingencies would arise from a review by the tax authorities of the operations in the years open to inspection.
Deferred tax assets and liabilities
The breakdown in these headings at January 1, 2011, December 31, 2011, and November 30, 2012, and the movements during the years then ended are as follows:

 	 	Thousands of U.S. dollars	 	
 	 	Balance at
12/31/2010	 	 	Increases	 	 	Decreases	 	 	Transfers	 	 	Translation
differences	 	 	Balance at
12/31/2011	 	
DEFERRED TAX ASSETS	 	 	68,938	  	 	 	7,826	  	 	 	(8,752	) 	 	 	(373	) 	 	 	(5,001	) 	 	 	62,638	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Unused tax losses (*)	 	 	25,776	  	 	 	469	  	 	 	(7,552	) 	 	 	70	  	 	 	(2,102	) 	 	 	16,661	  	
Unused tax credits	 	 	813	  	 	 	4,895	  	 	 	(107	) 	 	 	(719	) 	 	 	531	  	 	 	5,413	  	
Deferred tax assets (temporary differences)	 	 	42,349	  	 	 	2,462	  	 	 	(1,093	) 	 	 	276	  	 	 	(3,430	) 	 	 	40,564	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
DEFERRED TAX LIABILITIES	 	 	42,528	  	 	 	7,934	  	 	 	(315	) 	 	 	(82	) 	 	 	(4,668	) 	 	 	45,397	  	

(*)	Tax credits for loss carryforwards	
 
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 	 	Thousands of U.S. dollars	 	
 	 	Balance at
12/31/2011	 	 	Increases	 	 	Decreases	 	 	Transfers	 	 	Translation
differences	 	 	Balance at
11/30/2012	 	
DEFERRED TAX ASSETS	 	 	62,638	  	 	 	22,678	  	 	 	(22,979	) 	 	 	(356	) 	 	 	(3,157	) 	 	 	58,824	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Unused tax losses (*)	 	 	16,661	  	 	 	1,773	  	 	 	(12,194	) 	 	 	310	  	 	 	(1,002	) 	 	 	5,548	  	
Unused tax credits	 	 	5,413	  	 	 	195	  	 	 	(28	) 	 	 	(666	) 	 	 	7	  	 	 	4,921	  	
Deferred tax assets (temporary differences)	 	 	40,564	  	 	 	20,710	  	 	 	(10,757	) 	 	 	—	  	 	 	(2,162	) 	 	 	48,355	  	
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
DEFERRED TAX LIABILITIES	 	 	45,397	  	 	 	—	  	 	 	(1,498	) 	 	 	—	  	 	 	(3,934	) 	 	 	39,965	  	

(*)	Tax credits for loss carryforwards	
Deferred tax assets at December 31, 2011 and November 30, 2012 arose mainly from unused tax losses in Brazil (16,427 thousands U.S. Dollars in 2011 and 5,041 thousands U.S. Dollars in 2012 respectively) and temporary differences as a result of differing depreciation and amortization rates of assets for accounting and tax purposes in Brazil (17,806 thousands U.S. dollars in 2011 and 26,629 thousands U.S. Dollars in 2012 respectively).
Deferred tax assets has been registered in the statement of financial position in conformity with the best estimate on the future results, to the extent it is probable that above mentioned assets are recovered.
Deferred tax liabilities at December 31, 2011 and November 30, 2012, mainly include temporary differences arising from the amortization of Atento Brasil, S.A. goodwill for tax purposes.
The following table presents the schedule for the reversal of recognized and unrecognized deferred tax assets and liabilities in the statement of financial position based on the best estimates available at the respective estimation dates:
2011

 	  	Thousands of U.S. dollars	 	
 	  	2012	 	  	2013	 	  	2014	 	  	2015	 	  	2016	 	  	2017	 	  	Subsequent
years	 	  	Total	 	
Tax losses	  	 	9,764	  	  	 	6,897	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	16,661	  	
Recognized	  	 	9,764	  	  	 	6,897	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	16,661	  	
Not recognized	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	
Deductible temporary differences	  	 	27,267	  	  	 	5,898	  	  	 	5,912	  	  	 	1,197	  	  	 	91	  	  	 	9	  	  	 	190	  	  	 	40,564	  	
Recognized	  	 	27,267	  	  	 	5,898	  	  	 	5,912	  	  	 	1,197	  	  	 	91	  	  	 	9	  	  	 	190	  	  	 	40,564	  	
Not recognized	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	
Tax credits	  	 	144	  	  	 	—	  	  	 	626	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	4,643	  	  	 	5,413	  	
Recognized	  	 	144	  	  	 	—	  	  	 	626	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	4,643	  	  	 	5,413	  	
Not recognized	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total deferred tax assets	  	 	37,175	  	  	 	12,795	  	  	 	6,538	  	  	 	1,197	  	  	 	91	  	  	 	9	  	  	 	4,833	  	  	 	62,638	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Recognized	  	 	37,175	  	  	 	12,795	  	  	 	6,538	  	  	 	1,197	  	  	 	91	  	  	 	9	  	  	 	4,833	  	  	 	62,638	  	
Not recognized	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total deferred tax liabilities	  	 	631	  	  	 	239	  	  	 	238	  	  	 	89	  	  	 	143	  	  	 	52	  	  	 	44,005	  	  	 	45,397	  	

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2012

 	  	Thousands of U.S. dollars	 	
 	  	2013	 	  	2014	 	  	2015	 	  	2016	 	  	2017	 	  	2018	 	  	Subsequent
years	 	  	Total	 	
Tax losses	  	 	5,548	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	5,548	  	
Recognized	  	 	5,548	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	5,548	  	
Not recognized	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	
Deductible temporary differences	  	 	47,074	  	  	 	298	  	  	 	56	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	927	  	  	 	48,355	  	
Recognized	  	 	47,074	  	  	 	298	  	  	 	56	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	927	  	  	 	48,355	  	
Not recognized	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	
Tax credits	  	 	84	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	4,837	  	  	 	4,921	  	
Recognized	  	 	84	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	4,837	  	  	 	4,921	  	
Total deferred tax assets	  	 	52,706	  	  	 	298	  	  	 	56	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	5,764	  	  	 	58,824	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Recognized	  	 	52,706	  	  	 	298	  	  	 	55	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	5,764	  	  	 	58,824	  	
Not recognized	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	  	 	—	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total deferred tax liabilities	  	 	34,648	  	  	 	1,173	  	  	 	796	  	  	 	659	  	  	 	597	  	  	 	565	  	  	 	1,527	  	  	 	39,965	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Public administrations and Income Tax Payable
The breakdown of current tax receivable, income tax payables, other receivables from public administrations and other payables to public administrations at December 31, 2011, and November 30, 2012 is as follows:

 	  	Thousands of U.S. dollars	 	
Receivables	  	12/31/2011	 	  	11/30/2012	 	
Current	  				  				
Indirect tax	  	 	3,735	  	  	 	3,173	  	
Social security	  	 	966	  	  	 	—	  	
Withholding tax	  	 	489	  	  	 	—	  	
Other	  	 	6,397	  	  	 	6,457	  	
Income taxes receivable	  	 	7,997	  	  	 	34,557	  	
	  	 	 	 	  	 	 	 	
Total	  	 	19,584	  	  	 	44,187	  	

									
 	  	Thousands of U.S. dollars	 	
Payables	  	12/31/2011	 	  	11/30/2012	 	
Current	  				  				
Personal income tax withholdings	  	 	45,560	  	  	 	40,332	  	
Indirect taxes	  	 	22,973	  	  	 	17,023	  	
Social security	  	 	9,912	  	  	 	9,668	  	
Other	  	 	9,553	  	  	 	9,339	  	
Income taxes payable	  	 	11,234	  	  	 	47,396	  	
	  	 	 	 	  	 	 	 	
Total	  	 	99,232	  	  	 	123,758	  	

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19. REVENUE AND EXPENSE
a) Revenue
The breakdown of “Revenue” at the Predecessor for the year ended December 31, 2011 and the eleven-month period ended November 30, 2012 is as follows:

 	  	Thousands of U.S. dollars	 	
 	  	2011	 	  	2012	 	
Rendering of services to Telefónica Group companies (see Note 23)	  	 	1,235,944	  	  	 	1,065,376	  	
Rendering of services to other companies	  	 	1,181,342	  	  	 	1,060,552	  	
	  	 	 	 	  	 	 	 	
Total	  	 	2,417,286	  	  	 	2,125,928	  	
	  	 	 	 	  	 	 	 	
b) Other operating income
The breakdown of “Other operating income” in the combined carve-out income statements for the year ended December 31, 2011 and the eleven month period ended November 30, 2012 is as follows:

 	  	Thousands of U.S. dollars	 	
 	  	    2011    	 	  	    2012    	 	
Non-core and other operating income from Telefónica Group companies (Note 23)	  	 	431	  	  	 	755	  	
Non-core and other operating income from other companies	  	 	1,184	  	  	 	(161	) 	
Income from compensation and other non-recurring	  	 	—	  	  	 	479	  	
Government grants	  	 	1,902	  	  	 	751	  	
Gains on disposal of non-current assets (see Notes 6 & 8)	  	 	3,704	  	  	 	33	  	
	  	 	 	 	  	 	 	 	
Total	  	 	7,221	  	  	 	1,857	  	
	  	 	 	 	  	 	 	 	
c) Supplies
The breakdown of this heading by item and related party or external company for the year ended December 31, 2011 and the eleven month period ended November 30, 2012 was as follows:

 	  	Thousands of U.S. dollars	 	
 	  	    2011    	 	  	    2012    	 	
Induced business	  	 	47,504	  	  	 	38,667	  	
Infrastructure lease	  	 	940	  	  	 	—	  	
Other	  	 	349	  	  	 	3,665	  	
	  	 	 	 	  	 	 	 	
Total supplies by Telefónica Group companies (see Note 23)	  	 	48,793	  	  	 	42,332	  	
	  	 	 	 	  	 	 	 	
Induced business	  	 	2,996	  	  	 	2,976	  	
Infrastructure lease	  	 	35,147	  	  	 	25,309	  	
Other	  	 	42,909	  	  	 	34,891	  	
	  	 	 	 	  	 	 	 	
Total supplies by other companies	  	 	81,052	  	  	 	63,176	  	
	  	 	 	 	  	 	 	 	
TOTAL	  	 	129,845	  	  	 	105,508	  	

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d) Employee benefits expense
The breakdown of this heading for the year ended December 31, 2011 and the eleven month period ended November 30, 2012 was as follows:

 	  	Thousands of U.S. dollars	 	
 	  	2011	 	  	2012	 	
Wages and salaries	  	 	1,213,452	  	  	 	1,104,700	  	
Termination benefits	  	 	30,719	  	  	 	29,390	  	
Social security	  	 	246,789	  	  	 	146,265	  	
Restructuring	  	 	10,106	  	  	 	4,274	  	
Supplementary pension contributions	  	 	611	  	  	 	3,252	  	
Other welfare expenses	  	 	200,241	  	  	 	194,961	  	
	  	 	 	 	  	 	 	 	
TOTAL	  	 	1,701,918	  	  	 	1,482,842	  	
	  	 	 	 	  	 	 	 	
Supplementary pension contributions refer to a defined contribution structured through contributions at a certain percentage of the executive’s fixed remuneration. These percentages vary depending on the employee’s professional category. The plan envisages extraordinary contributions depending on the personal circumstances of each manager.
e) Number of employees
The average Predecessor workforce in 2011 and 2012 and the breakdown by country are as follows:

Headcount	 	
Country	  	    2011    	 	  	    2012    	 	
Argentina (1)	  	 	8,465	  	  	 	9,308	  	
Brazil	  	 	79,664	  	  	 	82,876	  	
Central America (2)	  	 	4,073	  	  	 	3,696	  	
Chile	  	 	4,684	  	  	 	4,314	  	
Colombia	  	 	3,867	  	  	 	4,513	  	
Spain (4)	  	 	15,170	  	  	 	14,624	  	
Morocco	  	 	2,159	  	  	 	2,196	  	
Mexico (3)	  	 	19,052	  	  	 	17,401	  	
Peru	  	 	8,646	  	  	 	9,744	  	
Puerto Rico	  	 	573	  	  	 	684	  	
Czech Republic	  	 	689	  	  	 	584	  	
	  	 	 	 	  	 	 	 	
Total	  	 	147,042	  	  	 	149,940	  	

(1)	Includes staff in Uruguay	
(2)	Includes staff in Guatemala, El Salvador and Panama	
(3)	Includes staff in Texas	
(4)	Includes corporate staff previously at Atento Inversiones y Teleservicios	
 
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f) Depreciation and amortization
The depreciation and amortization charges recognized in the combined carve-out income statements in 2011 and 2012 are as follows:

 	  	Thousands of U.S.
dollars	 	
 	  	    2011    	 	  	    2012    	 	
Amortization of intangible assets (Note 6)	  	 	26,434	  	  	 	26,155	  	
Depreciation of property, plant and equipment (see Note 8)	  	 	52,069	  	  	 	51,993	  	
	  	 	 	 	  	 	 	 	
Total	  	 	78,503	  	  	 	78,148	  	
	  	 	 	 	  	 	 	 	
g) Other operating expenses
The breakdown of “Other operating expenses” in the combined carve-out income statement for the year ended December 31, 2011 and the eleven month period ended November 30, 2012 is as follows:

 	  	Thousands of U.S.
Dollars	 	
 	  	    2011    	 	  	    2012    	 	
External services provided by Telefónica Group companies (see Note 23)	  	 	17,810	  	  	 	15,234	  	
External services provided by other companies	  	 	311,844	  	  	 	257,346	  	
Impairment allowance on Intangible assets and Property, plant and equipment
(see Notes 6 & 8)	  	 	8,534	  	  	 	38	  	
Taxes other than income tax	  	 	7,978	  	  	 	9,167	  	
Other operating expenses with Group companies	  	 	—	  	  	 	37	  	
Other operating expenses with other companies	  	 	343	  	  	 	(234	) 	
Write-off and disposals of non-current assets (see Note 6)	  	 	9,492	  	  	 	1,989	  	
	  	 	 	 	  	 	 	 	
TOTAL	  	 	356,001	  	  	 	283,577	  	

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The breakdown of “External services” under “Other operating expenses” by related party or external company for the year ended December 31, 2011 and the eleven month period ended November 30, 2012 is as follows:

 	  	Thousands of U.S. dollars	 	
 	  	    2011    	 	  	    2012    	 	
External services, Telefónica Group companies:	  				  				
Leases (see Note 22)	  	 	10,746	  	  	 	10,017	  	
Installation and maintenance	  	 	1,282	  	  	 	307	  	
Communications	  	 	942	  	  	 	1,339	  	
Publicity, advertising and public relations	  	 	203	  	  	 	46	  	
Insurance premiums	  	 	171	  	  	 	183	  	
Other	  	 	4,466	  	  	 	3,342	  	
	  	 	 	 	  	 	 	 	
Total external services, Telefónica Group companies	  	 	17,810	  	  	 	15,234	  	
	  	 	 	 	  	 	 	 	
External services, associates and other companies	  				  				
Leases (see Note 22)	  	 	127,274	  	  	 	103,325	  	
Installation and maintenance	  	 	41,047	  	  	 	38,453	  	
Lawyers and law firms	  	 	6,057	  	  	 	5,066	  	
Tax advisory	  	 	283	  	  	 	153	  	
Consultants	  	 	10,029	  	  	 	6,572	  	
Audit and other services	  	 	2,066	  	  	 	1,501	  	
Studies and work performed	  	 	84	  	  	 	44	  	
Other external professional services	  	 	5,520	  	  	 	3,316	  	
Advertising	  	 	1,002	  	  	 	1,285	  	
Fairs and events	  	 	1,656	  	  	 	1,089	  	
Public relations	  	 	348	  	  	 	440	  	
Other publicity, advertising and public relations	  	 	5,164	  	  	 	3,662	  	
Insurance premiums	  	 	1,493	  	  	 	1,465	  	
Travel expenses	  	 	17,865	  	  	 	10,032	  	
Utilities	  	 	34,368	  	  	 	33,681	  	
Banking and similar services	  	 	660	  	  	 	1,821	  	
Other	  	 	56,927	  	  	 	45,479	  	
	  	 	 	 	  	 	 	 	
Total external services, associates and other companies	  	 	311,843	  	  	 	257,384	  	
	  	 	 	 	  	 	 	 	
TOTAL	  	 	329,653	  	  	 	272,618	  	
	  	 	 	 	  	 	 	 	
h) Finance income, costs and net foreign exchange gain (loss)
The breakdown of “Finance income”, “Finance costs” and “net foreign exchange gain (loss) in the combined carve-out income statements for the year ended December 31, 2011 and the eleven month period ended November 30, 2012 was as follows:

 	  	Thousands of U.S. dollars	 	
 	  	    2011    	 	  	    2012    	 	
Income from securities and loans to Telefónica Group companies	  	 	558	  	  	 	280	  	
Income from securities and loans to other companies	  	 	10,374	  	  	 	11,301	  	
	  	 	 	 	  	 	 	 	
Total	  	 	10,932	  	  	 	11,581	  	
	  	 	 	 	  	 	 	 	
Finance costs on borrowings from Telefónica Group companies	  	 	823	  	  	 	243	  	
Finance costs on borrowings from other companies	  	 	18,370	  	  	 	23,265	  	
	  	 	 	 	  	 	 	 	
Total	  	 	19,193	  	  	 	23,508	  	

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The breakdown of “Exchange gains” and “Exchange losses” for the eleven month period ended November 30, 2012 and the year ended December 31, 2011 was as follows:

 	  	Thousands of U.S. dollars	 	
Exchange gains	  	    2011    	 	  	    2012    	 	
Loans and receivables	  	 	1,053	  	  	 	63	  	
Other financial transactions	  	 	583	  	  	 	7,993	  	
Trade transactions	  	 	8,610	  	  	 	1,888	  	
	  	 	 	 	  	 	 	 	
Total	  	 	10,246	  	  	 	9,944	  	

									
 	  	Thousands of U.S. dollars	 	
Exchange losses	  	    2011    	 	  	    2012    	 	
Loans and receivables	  	 	416	  	  	 	—	  	
Other financial transactions	  	 	8,574	  	  	 	7,085	  	
Trade transactions	  	 	4,076	  	  	 	3,835	  	
	  	 	 	 	  	 	 	 	
Total	  	 	13,066	  	  	 	10,920	  	
	  	 	 	 	  	 	 	 	
i) Auditors’ fees
The fees paid in 2012 to the various member firms of the Ernst & Young international organization, to which Ernst & Young, S.L. (the auditors of the Predecessor ) belongs, amounted to 1,112 thousand U.S. dollars. Fees paid in 2011 to the same firm, which also audited the Predecessor those years, amounted to 2,025 thousand U.S. dollars.
These fees include amounts paid in respect of fully consolidated Spanish and foreign Predecessor companies.
20. SEGMENT INFORMATION
The Chief Operating Decision Maker (“CODM”) is represented by the Chief Executive Officer. The CODM takes a geographic approach to decision-making, dividing the business up into three segments:
 
 	•	 	EMEA (Europe, Middle East and Africa), which combines the activities carried out regionally in Spain, Morocco and the Czech Republic.	
 
 	•	 	Americas, which includes the activities carried out by the various Spanish-speaking companies in Mexico, Central and South America. It also includes operations in the United States.	
 
 	•	 	Brazil, which given its different language and importance is managed separately.	
Intersegment transactions are measured using market prices.
The Predecessor uses earnings from continuing operations before interest, taxes and depreciation and amortization (EBITDA) and Adjusted EBITDA to track the performance of its segments and to establish operating and strategic targets. Management believes that EBITDA and Adjusted EBITDA provides an important measure of the segment’s operating performance because it allows management to evaluate and compare the segments’ operating results, including their return on capital and operating efficiencies, from period to period by removing the impact of their capital structure (interest expenses), asset bases (depreciation and amortization), discontinued operations and tax consequences. Adjusted EBITDA is defined as EBITDA adjusted to exclude acquisition and integration related costs, restructuring costs, asset impairments, site relocation costs, financing fees and other items which are not correlated to our core operating results.
 
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EBITDA and Adjusted EBITDA are a commonly reported measure and is widely used among analysts, investors and other interested parties in the Predecessor´s industry, although not a measure explicitly defined in IFRS, and therefore, may not be comparable to similar indicators used by other companies. EBITDA and Adjusted EBITDA should not be considered as an alternative to profit for the year as a measurement of our combined carve-out earnings or as an alternative to combined carve-out cash flows from operating activities as a measurement of our liquidity.
2011

 	  	EMEA	 	 	Americas	 	 	Brazil	 	 	Other and
eliminations	 	 	Group total	 	
Sales to other companies	  	 	104,976	  	 	 	358,930	  	 	 	716,952	  	 	 	484	  	 	 	1,181,342	  	
Sales to Telefónica Group and other Group companies	  	 	291,729	  	 	 	320,229	  	 	 	626,169	  	 	 	(2,183	) 	 	 	1,235,944	  	
Other operating income and expenses	  	 	(362,646	) 	 	 	(584,108	) 	 	 	(1,197,450	) 	 	 	(39,029	) 	 	 	(2,183,233	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
EBITDA	  	 	34,059	  	 	 	95,051	  	 	 	145,671	  	 	 	(40,728	) 	 	 	234,053	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Depreciation and amortization	  	 	(8,673	) 	 	 	(30,074	) 	 	 	(37,464	) 	 	 	(2,292	) 	 	 	(78,503	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Operating income (loss)	  	 	25,386	  	 	 	64,977	  	 	 	108,207	  	 	 	(43,020	) 	 	 	155,550	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net finance (expense) income	  	 	(1,021	) 	 	 	(4,823	) 	 	 	(4,896	) 	 	 	(342	) 	 	 	(11,082	) 	
Income tax	  	 	(6,894	) 	 	 	(15,956	) 	 	 	(29,258	) 	 	 	(2,748	) 	 	 	(54,856	) 	
Profit for the period (from continuing operations)	  	 	17,471	  	 	 	44,198	  	 	 	74,053	  	 	 	(46,110	) 	 	 	89,612	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Discontinued operations	  	 	722	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	722	  	
Profit for the period	  	 	18,193	  	 	 	44,198	  	 	 	74,053	  	 	 	(46,110	) 	 	 	90,334	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Non-controlling interests	  	 	—	  	 	 	(2,397	) 	 	 	—	  	 	 	—	  	 	 	(2,397	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Profit (loss) attributable to equity holders of the parent	  	 	18,193	  	 	 	41,801	  	 	 	74,053	  	 	 	(46,110	) 	 	 	87,937	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
EBITDA	  	 	34,059	  	 	 	95,051	  	 	 	145,671	  	 	 	(40,728	) 	 	 	234,053	  	
Adjustments to Adjusted EBITDA:	  				 				 				 				 				
Restructuring costs	  	 	—	  	 	 	—	  	 	 	—	  	 	 	8,046	  	 	 	8,046	  	
Asset impairments	  	 	—	  	 	 	—	  	 	 	—	  	 	 	8,577	  	 	 	8,577	  	
Other	  	 	(1,118	) 	 	 	—	  	 	 	(4,367	) 	 	 	1,712	  	 	 	(3,773	) 	
Adjusted EBITDA	  	 	32,941	  	 	 	95,051	  	 	 	141,304	  	 	 	(22,393	) 	 	 	246,903	  	
						
Capital expenditure	  	 	49,620	  	 	 	37,178	  	 	 	52,600	  	 	 	2,205	  	 	 	141,603	  	
						
Fixed assets	  	 	81,067	  	 	 	125,337	  	 	 	260,035	  	 	 	32,746	  	 	 	499,185	  	
Allocated assets	  	 	201,153	  	 	 	400,270	  	 	 	588,822	  	 	 	34,356	  	 	 	1,224,601	  	
Allocated liabilities	  	 	124,022	  	 	 	195,736	  	 	 	241,543	  	 	 	32,075	  	 	 	593,376	  	
 
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2012

 	  	EMEA	 	 	Americas	 	 	Brazil	 	 	Other and
eliminations	 	 	Group total	 	
Sales to other companies	  	 	105,174	  	 	 	324,390	  	 	 	630,860	  	 	 	128	  	 	 	1,060,552	  	
Sales to Telefónica Group and other Group companies	  	 	242,627	  	 	 	337,725	  	 	 	485,948	  	 	 	(924	) 	 	 	1,065,376	  	
Other operating income and expenses	  	 	(306,417	) 	 	 	(569,881	) 	 	 	(989,860	) 	 	 	(17,857	) 	 	 	(1,884,015	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
EBITDA	  	 	41,384	  	 	 	92,234	  	 	 	126,948	  	 	 	(18,653	) 	 	 	241,913	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Depreciation and amortization	  	 	(12,240	) 	 	 	(29,549	) 	 	 	(35,721	) 	 	 	(638	) 	 	 	(78,148	) 	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Operating income (loss)	  	 	29,144	  	 	 	62,685	  	 	 	91,227	  	 	 	(19,291	) 	 	 	163,765	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net finance (expense) income	  	 	(1,387	) 	 	 	(2,689	) 	 	 	(6,762	) 	 	 	(2,065	) 	 	 	(12,903	) 	
Income tax	  	 	(8,239	) 	 	 	(25,868	) 	 	 	(25,881	) 	 	 	(718	) 	 	 	(60,706	) 	
Non-controlling interests	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Discontinued operations	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Profit (loss) attributable to equity holders of the parent	  	 	19,518	  	 	 	34,128	  	 	 	58,584	  	 	 	(22,074	) 	 	 	90,156	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
EBITDA	  	 	41,384	  	 	 	92,234	  	 	 	126,948	  	 	 	(18,653	) 	 	 	241,913	  	
Adjustments to adjusted EBITDA:	  				 				 				 				 				
Acquisition and integration costs	  	 	—	  	 	 	—	  	 	 	—	  	 	 	221	  	 	 	221	  	
Restructuring costs	  	 	1,440	  	 	 	2,466	  	 	 	—	  	 	 	—	  	 	 	3,906	  	
Asset impairments	  	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	—	  	
Site relocation costs	  	 	—	  	 	 	—	  	 	 	1,736	  	 	 	—	  	 	 	1,736	  	
Other	  	 	(11,381	) 	 	 	(471	) 	 	 	—	  	 	 	—	  	 	 	(11,852	) 	
Adjusted EBITDA	  	 	31,443	  	 	 	94,229	  	 	 	128,684	  	 	 	(18,432	) 	 	 	235,924	  	
						
Capital expenditure	  	 	9,728	  	 	 	11,350	  	 	 	55,392	  	 	 	463	  	 	 	76,933	  	
Fixed assets	  	 	86,027	  	 	 	106,064	  	 	 	247,971	  	 	 	32,163	  	 	 	472,225	  	
Allocated assets	  	 	231,106	  	 	 	414,093	  	 	 	607,652	  	 	 	10,920	  	 	 	1,263,771	  	
Allocated liabilities	  	 	138,388	  	 	 	196,137	  	 	 	411,598	  	 	 	(152,419	) 	 	 	593,704	  	
Other and eliminations includes the activities of certain intermediate holding companies as well as intersegment transactions. The amount included in Other and eliminations of Allocated liabilities for 2012 corresponds mainly to the elimination of intragroup dividend payables from Brazil.
 
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The breakdown of external and inter-segment sales by the main countries where the Predecessor operates for the year ended December 31, 2011 and the eleven month period ended November 30, 2012 is as follows:

 	  	Thousands of U.S. dollars	 	
Country	  	2011	 	  	2012	 	
Spain	  	 	351,590	  	  	 	311,038	  	
Morocco	  	 	33,343	  	  	 	26,628	  	
Czech Republic	  	 	11,717	  	  	 	9,947	  	
	  	 	 	 	  	 	 	 	
EMEA	  	 	396,650	  	  	 	347,613	  	
	  	 	 	 	  	 	 	 	
Argentina	  	 	138,853	  	  	 	177,794	  	
Chile	  	 	73,987	  	  	 	64,073	  	
Colombia	  	 	50,783	  	  	 	54,950	  	
El Salvador	  	 	11,507	  	  	 	13,343	  	
United States	  	 	18,203	  	  	 	16,528	  	
Guatemala	  	 	13,936	  	  	 	13,846	  	
Mexico	  	 	261,632	  	  	 	213,478	  	
Peru	  	 	86,318	  	  	 	85,725	  	
Puerto Rico	  	 	14,237	  	  	 	13,747	  	
Uruguay	  	 	7,583	  	  	 	7,718	  	
Panama	  	 	249	  	  	 	177	  	
	  	 	 	 	  	 	 	 	
Americas	  	 	677,288	  	  	 	661,379	  	
	  	 	 	 	  	 	 	 	
Brazil	  	 	1,342,864	  	  	 	1,116,808	  	
	  	 	 	 	  	 	 	 	
Other and eliminations	  	 	484	  	  	 	128	  	
	  	 	 	 	  	 	 	 	
Total Group and non-Group revenue	  	 	2,417,286	  	  	 	2,125,928	  	
	  	 	 	 	  	 	 	 	
Inter-segment transactions are carried out at arm’s length prices.
Transactions accounting for 10% of the Predecessor´s revenue from operations, in this case transactions with the Telefónica Group, are detailed in Note 23. Transactions with BBVA represent approximately 8% of revenue from operations for the eleven months ended November 30, 2012 (9% for the year ended December 31, 2011).
21. DISCONTINUED OPERATIONS
In 2011, the only company considered a discontinued operation was Atento Italia, S.R.L. which was definitively liquidated in 2011.
In 2011, the results of discontinued operations were included in the combined carve-out income statement as shown in the table below:

 	  	Thousands of U.S. dollars	 	
 	  	2011	 	
Income	  	 	722	  	
Expenses	  	 	—	  	
Operating income	  	 	722	  	
Net finance income (expense)	  	 	—	  	
Profit before tax from discontinued operation	  	 	722	  	
Income tax expense	  	 	—	  	
Net profit attributable to the discontinued operation	  	 	722	  	
There were no discontinued operations in 2012.
 
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22. COMMITMENTS AND RIGHTS
Operating lease commitments
The minimum commitments on operating leases, classified as maturing in less than one year, between one and five years, and over five years, are as follows:
2011

 	  	Thousands of U.S. dollars	 	
 	  	Less than 1 year	 	  	1 to 5 years	 	  	More than
5 years	 	  	Total	 	
Lease payment commitments with third parties	  	 	121,007	  	  	 	209,620	  	  	 	69,343	  	  	 	399,970	  	
Lease payment commitments with related parties	  	 	7,078	  	  	 	3,418	  	  	 	—	  	  	 	10,496	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	128,085	  	  	 	213,038	  	  	 	69,343	  	  	 	410,466	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
2012

 	  	Thousands of U.S. dollars	 	
 	  	Less than 1 year	 	  	1 to 5 years	 	  	More than
5 years	 	  	Total	 	
Lease payment commitments with third parties	  	 	102,298	  	  	 	193,642	  	  	 	        —	  	  	 	295,940	  	
Lease payment commitments with related parties	  	 	3,972	  	  	 	211	  	  	 	—	  	  	 	4,183	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total	  	 	106,270	  	  	 	193,853	  	  	 	—	  	  	 	300,123	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Total expenses on operating leases recognized in the combined carve-out income statement for the year ended December 31, 2011 and for the eleven months ended November 30, 2012 under Infrastructure leasing from related parties (see Notes 19c & 23) amount to 940 thousand U.S. dollars and nil thousands of U.S. dollars, respectively.
For the year ended December 31, 2011 and for the eleven months ended November 30, 2012 under Infrastructure leasing from other companies (see Note 19c) total expenses amount to 35,147 thousand U.S. dollars and 298 thousand U.S. dollars, respectively.
For the year ended December 31, 2011 and for the eleven months ended November 30, 2012 under External services provided by related parties (see Note 19g) total expenses related to leases amount to 10,746 thousand U.S. dollars and 10,017 thousand U.S. dollars, respectively.
For the year ended December 31, 2011 and for the eleven months ended November 30, 2012 under External services provided by other companies (see Note 19g) total expenses related to leases amount to 127,274 thousand U.S. dollars and 103,325 thousand U.S. dollars, respectively.
There are no contingent payments on operating leases recognized in the consolidated income statements for the year ended December 31, 2011 and the eleven month period ended November 30, 2012.
The operating leases where the combined entities act as lessee are mainly on premises intended for use as call centers. These leases have various termination dates, with the latest terminating in 2020.
At December 31, 2011 and November 30, 2012, the payment commitment for the early cancellation of these leases amounts to 265,824 and 179,884 thousand U.S. dollars, respectively.
 
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Guarantees
At December 31, 2011 and November 30, 2012, the Predecessor had various guarantees and commitments with third parties amounting to 147,287 thousand U.S. dollars and 138,042 thousand U.S. dollars, respectively.
The transactions guaranteed and their respective amounts at December 31, 2011 and November 30, 2012 are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	12/31/2011	 	  	11/30/2012	 	
Financial transactions	  	 	113,229	  	  	 	83,846	  	
Contractual obligations with existing and potential customers	  	 	32,685	  	  	 	54,151	  	
Other	  	 	1,373	  	  	 	45	  	
	  	 	 	 	  	 	 	 	
Total	  	 	147,287	  	  	 	138,042	  	
	  	 	 	 	  	 	 	 	
The parent company’s directors consider that no contingencies will arise from these guarantees in addition to those already recognized.
23. RELATED PARTIES
As indicated in Note 2 regarding the shareholding and operating relationships between the Predecessor and Telefónica, S.A., the companies belonging to the combined entities have been listed separately in the statement of financial position, income statement, statement of cash flow and the notes to the financial statements where such disclosure was necessary.
All services provided by the Predecessor are billed at arm’s length prices irrespective of any relationship that may exist with customers that are companies included in the Telefónica Group.
To guarantee that prices are freely negotiated and arranged with related parties on an arm’s length basis, the Predecessor and the various Telefónica Group companies have established negotiation procedures whereby belonging to the same group is not a precondition for contracting services. Accordingly, to win service contracts, the prices offered must be competitive with those available in the marketplace.
To this end, the Predecessor performs regular internal and external studies to determine the objective benchmark price in each country for each service provided and thus ensure that all of the Predecessor’s commercial transactions with Telefónica Group companies are carried out on an arm’s length basis.
On May 8, 2007, Telefónica, S.A. and AIT signed a Master Agreement for the provision of services that came into effect in October 2008. In April 2011, the first addendum to this Master Agreement was signed, extending its term until December 31, 2016. Telefónica Group companies also adhered to the addendum of the Master Agreement, implying that all specific contracts in force shall be extended to December 31, 2016.
Transactions carried out between the Predecessor and the Telefónica Group in 2012 and 2011 that are not disclosed in other notes are detailed below.
 
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Assets & Liabilities
The breakdown of assets and liabilities balances with Telefónica Group companies at December 31, 2011 and November 30, 2012 was as follows:

 	  	2011	 	  	2012	 	
Receivables	  				  				
Loans	  	 	1,112	  	  	 	4	  	
Receivables	  	 	253,671	  	  	 	307,815	  	
Other receivables	  	 	2,610	  	  	 	4,341	  	
	  	 	 	 	  	 	 	 	
	  	 	257,393	  	  	 	312,160	  	
	  	 	 	 	  	 	 	 	
Other Assets	  				  				
Deposits and guarantees	  	 	179	  	  	 	187	  	
Prepayments	  	 	83	  	  	 	614	  	
	  	 	 	 	  	 	 	 	
	  	 	262	  	  	 	801	  	
	  	 	 	 	  	 	 	 	
Payables	  				  				
Payable	  	 	28,027	  	  	 	29,566	  	
Other payables	  	 	2,221	  	  	 	5,870	  	
Tax payable (related to consolidated taxes)	  	 	4,908	  	  	 	—	  	
Dividend payable to Telefónica	  	 	1	  	  	 	1,949	  	
Advances	  	 	4	  	  	 	8,659	  	
	  	 	 	 	  	 	 	 	
	  	 	35,161	  	  	 	46,044	  	
	  	 	 	 	  	 	 	 	
The long-term loan granted by Atento Brasil to Telesp Brasil, an affiliate of Telefónica, is included under “Financial assets”.
In September 2012, Atento Teleservicios España, S.A.U. arranged a credit line with Telefónica Finanzas, S.A.U. maturing in September 2012 for up to 33,926 thousand U.S. dollars. At September 30, 2012, Atento Teleservicios España, S.A.U. had drawn down 19,561 thousand U.S. dollars. The maturity of this credit line has been extended to November 13, 2012. Credit line was paid-off and closed out as of November 30, 2012.
In June 2012, Atento Servicios Auxiliares de Contact Center, S.L.U. signed a credit line with Telefónica Finanzas, S.A.U. maturing in September 2012 with a limit of 1,127 thousand U.S. dollars. At September 30, 2012, Atento Servicios Auxiliares de Contact Center, S.L.U. had drawn down 474 thousand U.S. dollars. The maturity of this credit line has been extended to November 13, 2012. The credit line was paid-off and closed out as of November 30, 2012.
Main transactions
The main transactions with Telefónica Group companies in 2011 and 2012 are as follows:

Transactions with Telefónica Group Companies	  	2011	 	 	2012	 	
Income	  				 				
Revenue and other Operating Income	  	 	1,236,375	  	 	 	1,066,132	  	
Finance Income	  	 	557	  	 	 	280	  	
			
Expenses	  				 				
Supplies	  	 	(48,793	) 	 	 	(42,332	) 	
External services	  	 	(17,810	) 	 	 	(15,234	) 	
Finance Costs	  	 	(823	) 	 	 	(242	) 	
Net translation differences	  	 	(2,857	) 	 	 	(235	) 	
Other administrative expenses	  	 	(220	) 	 	 	(1,045	) 	
 
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Directors and Key management compensation
The members of the Board of Directors of the Predecessor as of November 30, 2012 are those listed below:

Name	  	Position in the
Board of Directors	
Francisco Javier de Paz Mancho	  	Chairman	
Luis Iturbe Sanz de Madrid	  	Vice Chairman	
Alejandro Reynal Ample	  	Chief Executive Officer	
Claudio Vilar Furtado	  	Director	
José Benito de Vega	  	Director	
José Ignacio Calderón Balanzategui	  	Director	
Natalia Sainz Stuyck	  	Director	
Pierre Villar Iroumé	  	Director	
Nicolás Bonilla Villalonga	  	Director	
David Mª Jiménez-Blanco Carrillo de Albornoz	  	Director	
Oscar Maraver Sánchez–Valdepeñas	  	Director	
Alicia Herrán Fernández	  	Director	
Reyes Cerezo Rodríguez-Sedano	  	Non-Executive Secretary	
The following table show the total compensation paid to the Predecessor’s Board of Directors and key management in 2011 and 2012:

 	  	Thousands of U.S. dollars	 	
 	  	January-December 2011	 	  	January-November 2012	 	
Total compensation paid to Board of Directors	  	 	1,948	  	  	 	2,051	  	
Total compensation paid to Key Management	  	 	5,280	  	  	 	5,213	  	
Salary and other compensation	  	 	4,255	  	  	 	4,800	  	
Health insurance	  	 	31	  	  	 	54	  	
Payments of life insurance premiums	  	 	40	  	  	 	18	  	
Pension Plan	  	 	75	  	  	 	65	  	
Other benefits	  	 	879	  	  	 	276	  	
Indemnities paid to senior executives in 2011 and 2012 totaled 5,289 and 3,330 thousand U.S. dollars, respectively.
Share-based payments linked to the Telefónica, S.A. share price
In 2011 and during part of 2012, the Telefónica Group had the following shared-based payment plans linked to the share price of Telefónica, S.A. These plans have been settled in connection with the acquisition of the combined entities described in Note 1.
Telefónica, S.A. share plan: “Performance Share Plan”
At the General Shareholders’ Meeting of Telefónica S.A. on June 21, 2006, its shareholders approved the introduction of a long-term incentive plan for managers and senior executives of Telefónica S.A. and other Telefónica Group companies, including Midco Sarl. Under this plan, selected participants who met the qualifying requirements were given a certain number of Telefónica S.A. shares as a form of variable compensation.
The Plan was initially intended to last seven years. It is divided into five phases, each three years long, beginning on July 1 (the “Start Date”) and ending on June 30 three years later (the “End Date”). At the start of each phase the number of shares to be awarded to Plan beneficiaries is determined based on their success in
 
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meeting targets set. The shares are delivered, assuming targets are met, at the End Date of each phase. Each phase is independent from the others. The first started on July 1, 2006 (with shares to be delivered, if targets are met, on or after July 1, 2009) and the fifth phase began on July 1, 2010 (with any shares earned delivered on or after July 1, 2013).
Award of the shares is subject to a number of conditions:
 
 	•	 	The beneficiary must continue to work for the company throughout the three years of the phase, subject to certain special conditions related to departures.	
 
 	•	 	The actual number of shares awarded at the end of each phase will depend on success in meeting targets and the maximum number of shares assigned to each executive. Success is measured by comparing the total shareholder return (TSR), which includes both the share price and dividends offered by Telefónica shares, with the TSRs offered by a basket of listed telecom companies that comprise the comparison group. Each employee who is a member of the Plan is assigned at the start of each phase a maximum number of shares. The actual number of shares awarded at the end of the phase is calculated by multiplying this maximum number by a percentage reflecting their success at the date in question. This will be 100% if the TSR of Telefónica, S.A. is equal to or better than that of the third quartile of the Comparison Group and 30% if Telefónica, S.A.’s TSR is in line with the median. The percentage rises linearly for all points between these two benchmarks. If the TSR is below average no shares are awarded.	
When each phase matures, it is Telefónica, S.A. that is responsible for delivering the appropriate number of shares, determined as described above, to all the senior managers of the Telefónica Group taking part in the Plan. In this respect, at the end of each phase, Telefónica, S.A. will charge the Predecessor companies the share of the cost attributable to its managers and executives, calculated as the fair value on the grant date of the securities delivered.
Long-term incentive plan based on Telefónica, S.A. shares: “Performance and Investment Plan”
At the General Shareholders’ Meeting of Telefónica, S.A on May 18, 2011, a new long-term share-based incentive plan called the “Performance and Investment Plan” (the “Plan” or “PIP”) was approved for Telefónica Group directors and senior executives.
Under this Plan, a certain number of shares of Telefónica, S.A. will be delivered to participants selected by the Company who have opted to take part in the scheme and meet the requirements and conditions stipulated to this end.
The Plan includes the possibility of co-investment so that all participants may receive an additional number of shares. This is also subject to compliance with certain stated requirements and targets of the Plan.
The Plan lasts five years and is divided into three independent three-year phases (i.e. delivery of the shares for each three-year phase three years after the start date). The first phase began on July 1, 2011 (with the delivery of the related shares from July 1, 2014). The third phase will begin on July 1, 2013 (with delivery of the related shares from July 1, 2016).
The specific number of Telefónica, S.A. shares deliverable within the maximum amount established to each member at the end of each phase will be contingent and based on the Total Shareholder Return (“TSR”) of Telefónica, S.A. shares (from the reference value) throughout the duration of each phase compared to the TSRs of the companies included in the Dow Jones Global Sector Titans Telecommunications Index. For the purposes of this Plan, these companies make up the comparison group (“Comparison Group”).
The TSR is the indicator used to determine the Telefónica Group’s medium- and long-term value generation, measuring the return on investment for each shareholder. For the purposes of this Plan, the return on
 
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investment of each phase is defined as the sum of the increase or decrease in the Telefónica, S.A. share price and dividends or other similar items received by the shareholder during the phase in question.
At the beginning of each phase, each Participant is allocated a notional number of shares. The number of shares to be delivered under the Plan is expected to range from:
 
 	•	 	30% of the number of notional shares if Telefónica, S.A.’s TSR is at least equal to the median of the Comparison Group, and	
 
 	•	 	100% if Telefónica, S.A.’s TSR is within the third quartile or higher than that of the Comparison Group. The percentage is calculated using linear interpolation when it falls between the median and third quartile.	
The Plan includes an additional condition regarding compliance by all or part of the Participants with a target investment and holding period of Telefónica, S.A. shares (“Co-Investment”), to be determined for each Participant, as appropriate, by the Board of Directors based on a report by the Appointments, Compensation and Good Governance Commission.
In addition, and independently of any other conditions or requirements that may be established, in order to be entitled to receive the corresponding shares, each Participant must be a Telefónica Group employee at the delivery date for each phase, except in special cases as deemed appropriate.
Shares will be delivered at the end of each phase (i.e., in 2014, 2015, and 2016, respectively). The specific delivery date will be determined by the Board of Directors or the committee or individual entrusted by the Board to do so.
The shares to be delivered to Participants, subject to compliance with the pertinent legal requirements in this connection, may be either (a) treasury shares in Telefónica, S.A. acquired by Telefónica, S.A. itself or by any of the Telefónica Group companies; or (b) newly-issued shares.
2011
The third phase of the plan ended on June 30, 2011. A total of 72,176 shares were delivered by Telefónica, S.A. to the Predecessor’s managers.
At December 31, 2011, the maximum number of shares assigned to the Predecessor’s executives amounted to 255,668 shares.
The average term outstanding on these entitlements at December 31, 2011 is 1.5 years.
Therefore, at December 31, 2011, the amount recognized by the Predecessor was 1,480 thousand U.S. dollars, with the cost accrued in the period charged to personnel expenses for the portion of the cost accrued during the year, considering the time elapsed from the launch of the Plan to the statement of financial position date, as well as the best estimate of the total cost attributable to it. This Plan was terminated in 2012 upon the close of the Acquisition.
24. EVENTS AFTER THE END OF THE REPORTING PERIOD
We have evaluated subsequent events through April 29, 2014, the date these combined carve-out financial statements were available to be issued and have identified the following subsequent events. In December 2012, Telefónica, S.A. and certain funds affiliated with Bain Capital Partners, LLC reached a definitive agreement for the acquisition, through the Successor, of the 100% of the businesses carried out by the combined entities. After the acquisition date, which was established on December 1, 2012, the combined entities are controlled by the Successor directly or through intermediate holding companies. The consideration paid amounts to approximately 1,022,184 thousand U.S. dollars.
 
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The Successor has accounted for the acquisition of the combined entities in accordance with IFRS 3, Business Combinations, and has recorded assets acquired and liabilities assumed at fair value.
At February 3, 2014, Banco Nacional de Desenvolvimento Economico e Social (BNDES) granted a credit facility to the subsidiary Atento Brasil, S.A. for an amount equivalent to approximately 124.5 million U.S. dollars. On March 27, 2014 and April 16, 2014, BNDES disbursed BRL 56.6 million (24.8 million U.S. dollars) and BRL 23.7 million (10.6 million U.S. dollars) portions respectively of the total facility, accounting for 26.8% of total credit line.
 
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 ATALAYA LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES
(FORMERLY BC LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES)
INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
as of December 31, 2013 and June 30, 2014
(In thousands of U.S. dollars)

ASSETS	  	Notes	  	December 31,
2013
(Audited)	 	  	June 30,
2014
(Unaudited)	 	
NON-CURRENT ASSETS	  		  	 	1,071,381	  	  	 	1,037,130	  	
	  		  	 	 	 	  	 	 	 	
Intangible assets	  	Note 7	  	 	392,777	  	  	 	347,394	  	
Goodwill	  	Note 7	  	 	197,739	  	  	 	187,668	  	
Property, plant and equipment	  	Note 7	  	 	231,603	  	  	 	243,095	  	
Non-current financial assets	  		  	 	69,323	  	  	 	63,848	  	
Trade and other receivables	  	Note 9	  	 	72	  	  	 	77	  	
Other receivables from public administrations	  		  	 	—	  	  	 	1,562	  	
Other non-current financial assets	  	Note 9	  	 	53,812	  	  	 	52,129	  	
Derivative financial instruments	  	Note 9	  	 	15,439	  	  	 	10,080	  	
Deferred tax assets	  		  	 	179,939	  	  	 	195,125	  	
	  		  	 	 	 	  	 	 	 	
CURRENT ASSETS	  		  	 	770,799	  	  	 	787,094	  	
	  		  	 	 	 	  	 	 	 	
Trade and other receivables	  		  	 	553,026	  	  	 	546,069	  	
Trade and other receivables	  	Note 9	  	 	521,286	  	  	 	519,708	  	
Current income tax receivables	  		  	 	12,962	  	  	 	12,224	  	
Other receivables from public administrations	  		  	 	18,778	  	  	 	14,137	  	
Other current financial assets	  		  	 	4,282	  	  	 	62,776	  	
Other financial assets	  	Note 9	  	 	1,425	  	  	 	60,805	  	
Derivative financial instruments	  	Note 9 and 10	  	 	2,857	  	  	 	1,971	  	
Cash and cash equivalents	  	Note 9	  	 	213,491	  	  	 	178,249	  	
	  		  	 	 	 	  	 	 	 	
TOTAL ASSETS	  		  	 	1,842,180	  	  	 	1,824,224	  	
	  		  	 	 	 	  	 	 	 	
The accompanying Notes 1 to 17 are an integral part of the interim condensed consolidated financial statements
 
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ATALAYA LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES
(FORMERLY BC LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES)
INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
as of December 31, 2013 and June 30, 2014
(In thousands of U.S. dollars)

EQUITY AND LIABILITIES	  	Notes	  	December 31,
2013
(Audited)	 	 	June 30,
2014
(Unaudited)	 	
EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT	  		  	 	(133,966	) 	 	 	(163,483	) 	
	  		  	 	 	 	 	 	 	 	
Share capital	  	Note 8	  	 	2,592	  	 	 	2,592	  	
Retained earnings	  	Note 8	  	 	(60,659	) 	 	 	(84,970	) 	
Translation differences	  		  	 	(77,513	) 	 	 	(77,395	) 	
Valuation adjustments	  	Note 8	  	 	1,627	  	 	 	(3,697	) 	
Other reserves	  		  	 	(13	) 	 	 	(13	) 	
	  		  	 	 	 	 	 	 	 	
NON-CURRENT LIABILITIES	  		  	 	1,591,287	  	 	 	1,584,642	  	
	  		  	 	 	 	 	 	 	 	
Deferred tax liabilities	  		  	 	119,282	  	 	 	103,800	  	
Interest bearing-debt	  	Note 10	  	 	833,984	  	 	 	730,396	  	
Non-current payables to Group companies	  	Note 10	  	 	519,607	  	 	 	620,705	  	
Derivative financial instruments	  	Note 10	  	 	15,962	  	 	 	19,535	  	
Non-current provisions	  	Note 11	  	 	99,062	  	 	 	107,075	  	
Other non-current non-trade payables	  	Note 10	  	 	1,441	  	 	 	1,132	  	
Other non-current payables to public administrations	  		  	 	1,949	  	 	 	1,999	  	
	  		  	 	 	 	 	 	 	 	
CURRENT LIABILITIES	  		  	 	384,859	  	 	 	403,065	  	
	  		  	 	 	 	 	 	 	 	
Interest bearing-debt	  	Note 10	  	 	17,128	  	 	 	14,903	  	
Trade and other payables	  		  	 	353,213	  	 	 	361,404	  	
Trade payables	  	Note 10	  	 	109,897	  	 	 	116,020	  	
Current income tax payable	  		  	 	7,582	  	 	 	3,217	  	
Other current payables to public administrations	  		  	 	74,983	  	 	 	73,956	  	
Other non-trade payables	  	Note 10	  	 	160,751	  	 	 	168,211	  	
Current provisions	  	Note 11	  	 	14,518	  	 	 	26,758	  	
	  		  	 	 	 	 	 	 	 	
TOTAL EQUITY AND LIABILITIES	  		  	 	1,842,180	  	 	 	1,824,224	  	
	  		  	 	 	 	 	 	 	 	
The accompanying Notes 1 to 17 are an integral part of the interim condensed consolidated financial statements
 
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 ATALAYA LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES
(FORMERLY BC LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES)
INTERIM CONSOLIDATED INCOME STATEMENTS
for the six months ended June 30, 2013 and 2014
(In thousands of U.S. dollars)

 	  	Notes	 	  	Six months ended
June 30, 2013
(Unaudited)	 	 	Six months ended
June 30, 2014
(Unaudited)	 	
Revenue	  				  	 	1,167,071	  	 	 	1,153,618	  	
Other operating income	  				  	 	577	  	 	 	855	  	
Own work capitalized	  				  	 	—	  	 	 	211	  	
Supplies	  				  	 	(46,061	) 	 	 	(52,134	) 	
Employee benefit expense	  				  	 	(830,118	) 	 	 	(843,323	) 	
Depreciation and amortization	  	 	7	  	  	 	(66,004	) 	 	 	(61,622	) 	
Changes in trade provisions	  				  	 	2,221	  	 	 	(299	) 	
Other operating expenses	  				  	 	(191,983	) 	 	 	(167,059	) 	
Other gains	  	 	7	  	  	 	—	  	 	 	34,881	  	
Impairment charges	  	 	7	  	  	 	—	  	 	 	(32,866	) 	
	  				  	 	 	 	 	 	 	 	
OPERATING PROFIT	  				  	 	35,703	  	 	 	32,262	  	
	  				  	 	 	 	 	 	 	 	
Finance income	  				  	 	8,887	  	 	 	7,102	  	
Finance costs	  				  	 	(66,414	) 	 	 	(77,828	) 	
Net foreign exchange gains	  				  	 	(3,363	) 	 	 	3,610	  	
	  				  	 	 	 	 	 	 	 	
NET FINANCE EXPENSE	  				  	 	(60,890	) 	 	 	(67,116	) 	
	  				  	 	 	 	 	 	 	 	
LOSS BEFORE TAX	  				  	 	(25,187	) 	 	 	(34,854	) 	
	  				  	 	 	 	 	 	 	 	
Income tax benefit	  	 	13	  	  	 	2,074	  	 	 	10,543	  	
	  				  	 	 	 	 	 	 	 	
LOSS ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT	  				  	 	(23,113	) 	 	 	(24,311	) 	
	  				  	 	 	 	 	 	 	 	
Result per share attributable to owners of the parent	  				  				 				
Basic and diluted result per share (Note 14)	  				  	 	(11.56	) 	 	 	(12.16	)	
	  				  	 	 	 	 	 	 	 	
The accompanying Notes 1 to 17 are an integral part of the interim condensed consolidated financial statements
 
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 ATALAYA LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES
(FORMERLY BC LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES)
INTERIM CONSOLIDATED STATEMENTS OF OTHER COMPREHENSIVE INCOME
for the six months ended June 30, 2013 and 2014
(In thousands of U.S. dollars)

 	  	Six months ended
June 30, 2013
(Unaudited)	 	 	Six months ended
June 30, 2014
(Unaudited)	 	
Loss for the period	  	 	(23,113	) 	 	 	(24,311	) 	
	  	 	 	 	 	 	 	 	
Other comprehensive income/(loss)	  				 				
Items that will not be reclassified to profit and loss	  	 	—	  	 	 	—	  	
Items that may subsequently be reclassified to profit and loss	  				 				
Cash flow hedges	  	 	1,811	  	 	 	(7,621	) 	
Tax effect	  	 	(1,770	) 	 	 	2,297	  	
Translation differences	  	 	(20,328	) 	 	 	118	  	
	  	 	 	 	 	 	 	 	
Other comprehensive loss, net of taxes	  	 	(20,287	) 	 	 	(5,206	) 	
	  	 	 	 	 	 	 	 	
Total comprehensive loss	  	 	(43,400	) 	 	 	(29,517	) 	
	  	 	 	 	 	 	 	 	
The accompanying Notes 1 to 17 are an integral part of the interim condensed consolidated financial statements
 
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 ATALAYA LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES
(FORMERLY BC LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES)
INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
for the six months ended June 30, 2013 and 2014
(In thousands of U.S. dollars)

 	  	Share
capital
(Note 8)	 	  	Retained
earnings
(Note 8)	 	 	Translation
differences	 	 	Valuation
adjustments
(Note 8)	 	 	Other
reserves	 	 	Total equity	 	
Balance at January 1, 2013	  	 	2,592	  	  	 	(56,620	) 	 	 	21,328	  	 	 	—	  	 	 	(13	) 	 	 	(32,713	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Comprehensive loss for the period	  	 	—	  	  	 	(23,113	) 	 	 	(20,328	) 	 	 	41	  	 	 	—	  	 	 	(43,400	) 	
Loss for the period	  	 	—	  	  	 	(23,113	) 	 	 	—	  	 	 	—	  	 	 	—	  	 	 	(23,113	) 	
Other comprehensive loss	  	 	—	  	  	 	—	  	 	 	(20,328	) 	 	 	41	  	 	 	—	  	 	 	(20,287	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance at June 30, 2013 (*)	  	 	2,592	  	  	 	(79,733	) 	 	 	1,000	  	 	 	41	  	 	 	(13	) 	 	 	(76,113	) 	

 	  	Share
capital
(Note 8)	 	  	Retained
earnings
(Note 8)	 	 	Translation
differences	 	 	Valuation
adjustments
(Note 8)	 	 	Other
reserves	 	 	Total equity	 	
Balance at January 1, 2014	  	 	2,592	  	  	 	(60,659	) 	 	 	(77,513	) 	 	 	1,627	  	 	 	(13	) 	 	 	(133,966	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Comprehensive loss for the period	  	 	—	  	  	 	(24,311	) 	 	 	118	  	 	 	(5,324	) 	 	 	—	  	 	 	(29,517	) 	
Profit for the period	  	 	—	  	  	 	(24,311	) 	 	 	—	  	 	 	—	  	 	 	—	  	 	 	(24,311	) 	
Other comprehensive loss	  	 	—	  	  	 	—	  	 	 	118	  	 	 	(5,324	) 	 	 	—	  	 	 	(5,206	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance at June 30, 2014 (*)	  	 	2,592	  	  	 	(84,970	) 	 	 	(77,395	) 	 	 	(3,697	) 	 	 	(13	) 	 	 	(163,483	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
The accompanying Notes 1 to 17 are an integral part of the interim condensed consolidated financial statements
 
(*)	UNAUDITED	
 
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 ATALAYA LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES
(FORMERLY BC LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES)
INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
for the six months ended June 30, 2013 and 2014
(In thousands of U.S. dollars)

 	  	Note	  	Six months ended
June 30, 2013
(Unaudited)	 	 	Six months ended
June 30, 2014
(Unaudited)	 	
Operating activities	  		  				 				
Loss before tax	  		  	 	(25,187	) 	 	 	(34,854	) 	
Adjustments to loss:	  		  				 				
Amortization and depreciation	  	7	  	 	66,004	  	 	 	61,622	  	
Impairment allowances	  		  	 	(2,221	) 	 	 	33,165	  	
Change in provisions	  		  	 	9,850	  	 	 	23,666	  	
(Gains)/losses on disposal of fixed assets	  		  	 	965	  	 	 	(438	) 	
(Gains)/losses on disposal of financial assets	  		  	 	539	  	 	 	656	  	
Finance income	  		  	 	(5,042	) 	 	 	(4,901	) 	
Finance expense	  		  	 	60,536	  	 	 	67,378	  	
Exchange differences	  		  	 	3,364	  	 	 	(3,610	) 	
Change in financial instruments fair value	  		  	 	1,493	  	 	 	7,592	  	
Own work capitalized	  		  	 	—	  	 	 	(211	) 	
Other gains	  	7/10	  	 	—	  	 	 	(34,881	) 	
	  		  	 	 	 	 	 	 	 	
	  		  	 	135,488	  	 	 	150,038	  	
Changes in working capital:	  		  				 				
Change in trade and other receivables	  		  	 	(5,954	) 	 	 	6,642	  	
Change in trade and other payables	  		  	 	(10,945	) 	 	 	18,268	  	
Other assets/(payables)	  		  	 	3,432	  	 	 	(15,534	) 	
	  		  	 	 	 	 	 	 	 	
	  		  	 	(13,467	) 	 	 	9,376	  	
Other cash flows from operating activities:	  		  				 				
Interest paid	  		  	 	(36,834	) 	 	 	(48,341	) 	
Interest received	  		  	 	1,719	  	 	 	9,242	  	
Income tax paid	  		  	 	(17,416	) 	 	 	(9,967	) 	
Other payments	  		  	 	(10,117	) 	 	 	(9,631	) 	
	  		  	 	 	 	 	 	 	 	
	  		  	 	(62,648	) 	 	 	(58,697	) 	
	  		  	 	 	 	 	 	 	 	
Net cash flows from operating activities	  		  	 	34,186	  	 	 	65,863	  	
	  		  	 	 	 	 	 	 	 	
Investing activities	  		  				 				
Payments for acquisition of intangible assets	  		  	 	(4,987	) 	 	 	(7,250	) 	
Payments for acquisition of property, plant and equipment	  		  	 	(53,611	) 	 	 	(37,912	) 	
Payments for financial instruments	  		  	 	(52,785	) 	 	 	(60,189	) 	
Disposals of intangible assets	  		  	 	40	  	 	 	99	  	
Disposals of property, plant and equipment	  		  	 	—	  	 	 	886	  	
Disposal of financial instruments	  		  	 	9,883	  	 	 	2,356	  	
	  		  	 	 	 	 	 	 	 	
Net cash flows used in investing activities	  		  	 	(101,460	) 	 	 	(102,010	) 	
	  		  	 	 	 	 	 	 	 	
Financing activities	  		  				 				
Proceeds from borrowings from third parties	  	10	  	 	289,887	  	 	 	37,205	  	
Proceeds from borrowings from group companies	  	15	  	 	—	  	 	 	87,923	  	
Repayment of borrowings from third parties	  	10	  	 	(249,076	) 	 	 	(123,954	) 	
Repayment of borrowings from group companies	  		  	 	(38	) 	 	 	—	  	
	  		  	 	 	 	 	 	 	 	
Net cash flows from financing activities	  		  	 	40,773	  	 	 	1,174	  	
	  		  	 	 	 	 	 	 	 	
Exchange differences	  		  	 	3,306	  	 	 	(269	) 	
Net decrease in cash and cash equivalents	  		  	 	(23,195	) 	 	 	(35,242	) 	
Cash and cash equivalents at beginning of period	  		  	 	200,311	  	 	 	213,491	  	
	  		  	 	 	 	 	 	 	 	
Cash and cash equivalents at end of period	  	9	  	 	177,116	  	 	 	178,249	  	
	  		  	 	 	 	 	 	 	 	
The accompanying Notes 1 to 17 are an integral part of the interim condensed consolidated financial statements
 
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 ATALAYA LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES
(FORMERLY BC LUXCO MIDCO, S.A.R.L. AND SUBSIDIARIES)
SELECTED EXPLANATORY NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED JUNE 30, 2014
1. COMPANY ACTIVITY AND CORPORATE INFORMATION
Atalaya Luxco Midco—formerly BC Luxco Midco—(hereinafter the “Company”), and its subsidiaries (hereinafter the “Atento Group”) comprise a group of companies that offers contact management services to its clients throughout the entire contract life cycle, through contact centers or multichannel platforms.
The Company was incorporated on November 27, 2012 as a limited-liability company. Finally, on February 6, 2013 the Company changed its corporate name from BC Luxco Midco to Atalaya Luxco Midco.
The Company was incorporated under the laws of the Grand-Duchy of Luxembourg, with registered office in Luxembourg at 4, Rue Lou Hemmer.
The Company was acquired in 2012 by Bain Capital Partners, LLC (hereinafter “Bain Capital”). Bain Capital is a private investment fund that invests in companies with a high growth potential. Notable among its investments in the Customer Relationship Management (hereinafter “CRM”) sector is its holding in Bellsystem 24, a leader in customer service in Japan, and Genpact, the largest business management services company in the world.
On December 2012, Bain Capital reached a definitive agreement with Telefónica, S.A. for the transfer nearly of 100% of the CRM business carried out by Atento Group companies (the “Acquisition”), the parent company of which was Atento Inversiones y Teleservicios, S.A. (hereinafter “AIT”). The Venezuela-based subsidiaries of the group headed by AIT, and AIT, except for some specific assets and liabilities, were not included in the Acquisition. Control was transferred for the purposes of creating the consolidated Atento Group on December 1, 2012. These consolidated financial statements are prepared since December 1, 2012.
The sole shareholder of the Company is a firm incorporated under the laws of the Grand-Duchy of Luxembourg, Atalaya Luxco Pikco, S.A.C. (Luxembourg). The ultimate parent company of the group is Atalaya Luxco Topco, S.C.A. (Luxembourg).
The Company’s corporate purpose is to hold business stakes of any kind in companies in Luxembourg and abroad, purchase and sell, subscribe or any other format, and transfer through sale, swap or otherwise of securities of any kind, and administration, management, control and development of the investment portfolio.
The Company may also act as the guarantor of loans and securities, as well as assist companies in which it holds direct or indirect interests or that form part of its group. The Company may secure funds, with the exception of public offerings, through any kind of lending, or through the issuance of bonds, securities or debt instruments in general.
The Company may also carry on any commercial, industrial, financial or real estate business, or intellectual property related activity that it deems necessary to meet the aforementioned corporate purpose.
The corporate purpose of its subsidiaries, with the exception of the intermediate holding companies, is to establish, manage and operate CRM centers through multichannel platforms, provide telemarketing, marketing and “call center” services through service agencies or any other format currently existing or which may be developed in the future by the Atento Group, provide telecommunications, logistics, telecommunications system management, data transmission, processing and Internet services and to promote new technologies in these areas, offer consultancy and advisory services to customers in all areas in connection with telecommunications, processing, integration systems and new technologies, and other services related to the above.
 
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2. BASIS OF PRESENTATION OF THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The interim condensed consolidated financial statements for the six months ended June 30, 2014 (the “interim financial statements”) have been prepared in accordance with International Accounting Standard (IAS) 34 “Interim Financial Reporting”. Therefore, they do not contain all the information and disclosures required in complete annual consolidated financial statements and, for adequate interpretation, should be read in conjunction with the Atento Group’s consolidated annual financial statements for the year ended December 31, 2013.
The figures in these interim consolidated financial statements are expressed in thousands of dollars unless indicated otherwise. U.S. Dollar is the Atento Group’s presentation currency.
These interim financial statements have been prepared on a historical cost basis, except for derivative financial instruments and Contingent Value Instruments (see Note 10), which have been measured at fair value.
Going concern
As of June 30, 2014, the Atento Group presents negative shareholders’ equity for an amount of 163,483 thousands of U.S. dollars (133,966 thousands of U.S. dollars as of December 31, 2013), primarily due to the incorporation of the new Group, following the acquisition of the former Atento Group, where equity has been negatively impacted by the costs incurred in connection with the acquisition and by integration related costs associated to the change in ownership. Shareholders’ equity is also negatively impacted by the impact of foreign exchanges and the impact of the Atento Group’s financial structure reflected in the negative net finance result.
As of June 30, 2014 all short term commitments had been settled within their periods, and it is expected that all debt maturities within the next twelve months will be settled in the required periods.
Management considers that the fundamentals of the business remain sound and that the following factors reasonably will further contribute to mitigate any uncertainty on the capacity of the Atento Group to generate enough resources in order to operate under a going concern basis:
 
 	•	 	The Atento Group enjoys a sound liquidity position with total cash and cash equivalents as of June 30, 2014 amounting to 178,249 thousands of U.S. dollars, above our minimum cash requirements to operate the business (compared to 213,491 thousands of U.S. dollars as of December 31, 2013) and short term financial investments amounting to 59,487 thousands of U.S. dollars (see Note 9). In addition, we entered into a Super Senior Revolving Credit Facility in 2013 allowing for borrowings up to 50 million of euros (equivalent to 68.3 million U.S. dollars as of June 30, 2014), which remains undrawn as of June 30, 2014 and December 31, 2013.	
 
 	•	 	As indicated in the paragraph above, the Atento Group has cash and financing facilities available to cover payments arising in the normal course of its business and financing commitments arisen from our debt commitments, as well as positive working capital.	
 
 	•	 	The Atento Group continues to implement measures with the objective of growing in revenue in the medium term. Revenue growth is expected to be driven by accelerated customer acquisitions, focus on further expanding our multi-sector customers leveraging on our strong credentials and market position in the countries where we operate.	
 
 	•	 	In addition to the above, the Atento Group is also focused on several initiatives to further drive margin expansion and incremental EBITDA potential through enhancement of operations productivity, centralization and standardization of activities following the exit from the Telefónica Group, such procurement activities, and efficiencies in costs.	
 
 	•	 	The measures described above are not only oriented to an improvement in revenue and margins but also to improve the cash generation and the efficiency of working capital.	
 
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 	•	 	The Atento Group has debt instruments available, such as the Preferred Equity Certificates, which can be capitalized as equity if necessary and which would have a double impact of reducing finance expenses and reducing negative retained earnings.	
Accordingly, management has prepared these interim condensed consolidated financial statements based on the principle of going concern.
3. COMPARATIVE INFORMATION
Comparative information in the interim financial statements refer to the six month periods ended June 30, 2014 and 2013, except for the statement of financial position, which compares information as of June 30, 2014, and December 31, 2013.
During the six months ended June 30, 2014 there have not been any changes in the consolidation scope.
4. ACCOUNTING POLICIES
a) New and amended standards and interpretations
The accounting policies adopted in the preparation of the interim financial statements for the six months ended June 30, 2014 are consistent with those followed in the preparation of the consolidated annual financial statements for the year ended December 31, 2013, except for the following standards and amendments to existing standards:
 
 	•	 	Amendment to IAS 32—Offsetting Financial Assets and Financial Liabilities : effective for annual periods beginning on or after January 1, 2014.	
 
 	•	 	Amendment to IFRS 10, IFRS 11 and IAS 27—Investment Entities : effective for annual periods beginning on or after January 1, 2014.	
 
 	•	 	IFRIC 21—Levies : effective for annual periods beginning on or after January 1, 2014.	
 
 	•	 	Amendments to IAS 39—Novation of Derivatives and Continuation of Hedge Accounting : effective for annual periods beginning on or January 1, 2014.	
The adoption of these standards and amendments did not have a significant impact on these interim financial statements.
b) Standards and interpretations published by the IASB, but not yet applicable in this period
At the date of publication of these interim financial statements, the following amendment had been issued by the IASB, but its application was not mandatory:
 
 	•	 	IFRS 9—Financial Instruments: effective for annual periods beginning on or after January 1, 2018.	
 
 	•	 	IFRS 14—Regulatory Deferral Accounts: effective for annual periods beginning on or after January 1, 2016.	
 
 	•	 	Amendment to IAS 19—Defined Benefit Plans: Employee Contributions: effective for annual periods beginning on or after July 1, 2014.	
 
 	•	 	Annual Improvements to IFRSs 2010-2012 Cycle: effective for annual periods beginning on or after July 1, 2014.	
 
 	•	 	Annual Improvements to IFRSs 2011-2013 Cycle: effective for annual periods beginning on or after July 1, 2014.	
 
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 	•	 	IFRS 15 Revenue from Contracts with Customers: effective for annual periods beginning on or after July 1, 2017.	
 
 	•	 	Amendment to IAS 16 and IAS 38: Clarification of Acceptable Methods of Depreciation and Amortization: effective for annual periods beginning on or after January 1, 2016.	
The Atento Group is currently assessing the impact of the application of these amendments. Pursuant to the analyses conducted to date, the Atento Group estimates that the application of these amendments will not have a material impact on the consolidated financial statements in the period of its initial application.
5. MANAGEMENT OF FINANCIAL RISK
5.1 Financial risk factors
The Atento Group’s activities expose it to various types of financial risk: market risk (including currency risk, interest rate risk and country risk), credit risk and liquidity risk. The Atento Group’s global risk management policy aims to minimize the potential adverse effects of these risks on the Atento Group’s financial returns. The Atento Group also uses derivative financial instruments to hedge certain risk exposures.
These condensed consolidated interim financial statements do not include all financial risk management information and disclosures required in the annual financial statements and therefore they should be read in conjunction with the Atento Group’s annual financial statements as of and for the year ended December 31, 2013. During the six months ended June 30, 2014 there have not been changes in any risk management policies.
Country Risk
To manage or mitigate country risk, we repatriate the funds generated in Latin America that are not required for the pursuit of new, profitable business opportunities in the region and subject to the restrictions of our financing agreements. The capital structure of the Atento Group comprises two separate ring-fenced financings: (i) the Brazilian Debentures and (ii) the U.S.$300 million 7.375% Senior Secured Notes due 2020, together with the €50 million ($68.3 million) Revolving Credit Facility. The Brazilian term loan is denominated in Brazilian reais and our obligations are paid with cash flows from Atento Brazil revenue in Brazilian reais. This creates a natural hedge for debt commitments eliminating any foreign exchange risk. In addition, in connection with the issuance of the Senior Secured Notes in U.S. dollars we entered into a series of cross currency swaps derivatives agreements, effectively hedging 90% of the related interest payments in Euros, Mexican Pesos, Colombian Pesos and Peruvian Soles, and 75% of the principal exposure in Euros and Mexican Pesos.
Argentinean subsidiaries are not party to these two separate ring-fenced financings, and we do not rely on cash flows from these operations to serve our debt commitments entered into in connection with the Acquisition.
Interest Rate Risk
Interest rate risk arises mainly as a result of changes in interest rates which affect: finance costs of debt bearing interest at variable rates (or short-term maturity debt expected to be renewed), as a result of fluctuations in interest rates, and the value of non-current liabilities that bear interest at fixed rates. Our exposure to interest rate risk arises principally from interest on our indebtedness. As of June 30, 2014, we had total consolidated indebtedness of approximately 1,366,004 thousands of U.S. dollars, of which approximately 50.7% (excluding CVIs and the PECs) bears interest at variable rates. As of December 31, 2013, we had total consolidated indebtedness of approximately 1,370,719 thousands of U.S. dollars, of which approximately 43.2% (excluding CVIs and the PECs) bears interest at variable rates.
As of June 30, 2014, the estimated fair value of the interest rate hedging instruments related to the Brazilian Debentures totaled 10,255 thousands of U.S. dollars, which was recorded as a financial asset. Based on our total indebtedness of 1,366,004 thousands of U.S. dollars as of June 30, 2014 and not taking into account the impact of
 
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our interest rate hedging instruments referred to above, a 1% change in interest rates would impact our net interest expense by 1,661 thousands of U.S. dollars.
As of December 31, 2013, the estimated fair value of the interest rate hedging instruments related to the Brazilian Debentures totaled 15,611 thousands of U.S. dollars, which was recorded as a financial asset. Based on our total indebtedness of 1,370,719 thousands of U.S. dollars as of December 31, 2013 and not taking into account the impact of our interest rate hedging instruments referred to above, a 1% change in interest rates would impact our net interest expense by 3,786 thousands of U.S. dollars.
Foreign Currency Risk
Our exposure to market risk arises principally from exchange rate risk. While the U.S. dollar is our reporting currency, approximately 98% of our revenue for the six months period ended June 30, 2014 was generated in local currencies other than the U.S. dollar. In addition to the U.S. dollar, we also generate significant revenues in Brazilian reais, Euros and Mexican pesos. The exchange rates among the U.S. dollar and these local currencies have changed substantially in recent years and may fluctuate substantially in the future. Our exchange rate risk arises from our local currency revenues, receivables and payables. We benefit to a certain degree from the fact that the revenue we collect in each country in which we have operations is generally denominated in the same currency as the majority of the expenses we incur in earning this revenue.
In accordance with our risk management policy, whenever we deem it appropriate, we manage foreign currency risk by using derivatives to hedge any debts incurred in currencies other than those of the countries where the companies taking on the debt are domiciled.
Upon closing of the Senior Secured Notes issued in U.S. dollars, we entered into cross-currency interest rate swaps pursuant to which we exchanged an amount of U.S. dollars equal to the face amount of the Senior Secured Notes for an amount of Euro, Mexican Pesos, Colombian Pesos and Peruvian Soles. On each interest payment date under the Senior Secured Notes, we receive from the applicable swap counterparty an amount in U.S. dollars equal to a semi-annual amount of interest at a rate per year equal to the interest rate payable on the Senior Secured Notes and calculated based on the amount of U.S. dollars initially exchanged by us under the currency swap and we will pay to the applicable swap counterparty an amount in the applicable other currency equal to a semi-annual amount of interest at a per annum rate equal to the benchmark floating rate for currency swaps for the applicable semi-annual period. Finally, on the maturity date of each currency swap, we will receive from the applicable swap counterparty U.S. dollars in an amount equal to the initial U.S. dollar exchange amount for such currency swap, and will pay to the applicable swap counterparty the applicable other currency in an amount equal to the initial foreign currency exchange amount for such currency swap. As of June 30, 2014, the estimated net fair value of the interest rate hedge instruments related to the cross-currency swaps entered into to hedge the Senior Secured Notes totaled 17,739 thousands of U.S. dollars (13,277 thousands of U.S. dollars, as of December 31, 2013), of which 19,535 thousands of U.S. dollars (15,962 thousands of U.S. dollars as of December 31, 2013) was recorded as long-term financial debt and 1,796 thousands of U.S. dollars (2,685 thousands of U.S. dollars as of December 31, 2013) was recorded as long-term financial assets (see Note 10).
Credit Risk
Financial instruments that potentially subject us to credit risk consist principally of accounts receivable, cash and cash equivalents, and long-term financial assets. Our maximum exposure to credit risk on financial assets is the carrying amount of said assets. Our commercial credit risk management approach is based on continuous monitoring of the risk assumed and the financial resources necessary to manage our various units, in order to optimize the risk-reward relationship in the development and implementation of the business plans of our various units in their ordinary management. Accounts receivable are typically unsecured and are derived from revenue earned from clients primarily in Latin America and EMEA. Additionally, we carry out significant transactions with the Telefónica Group. At June 30, 2014, accounts receivable due from the Telefónica Group amounted to 282,567 thousands of U.S. dollars (302,234 thousands of U.S. dollars as of December 31, 2013).
 
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Credit risk arising from cash and cash equivalents is managed by placing cash surpluses in high quality and highly liquid money-market assets. These placements are regulated by a master agreement revised annually on the basis of conditions prevailing in the markets and the countries where we operate. The master agreement establishes: (i) the maximum amounts to be invested per counterparty, based on their ratings (long- and short-term debt rating); (ii) the maximum period of the investment; and (iii) the instruments in which the surpluses may be invested.
Liquidity Risk
We seek to match our debt maturity schedule to our capacity to generate cash flows to meet the payments falling due, factoring in a degree of cushion. In practice, this has meant that our average debt maturity must be longer than the length of time we require to generate cash flows to pay our debt (assuming that internal projections are met).
At June 30, 2014, the average term to maturity of our debt with third parties (745,299 thousands of U.S. dollars) was 5.1 years. In addition, we had current assets of 787,094 thousands of U.S. dollars at such date, which includes short term financial investments of 59,487 thousands of U.S. dollars and cash and cash equivalents of 178,249 thousands of U.S. dollars, of which 6,871 thousands of U.S. dollars are located in Argentina and subject to restrictions on our ability to transfer them out of the country.
At December 31, 2013, the average term to maturity of our debt with third parties (851,112 thousands of U.S. dollars) was 6.1 years. In addition, we had current assets of 770,799 thousands of U.S. dollars at such date, which included cash and cash equivalents of 213,491 thousands of U.S. dollars, of which 13,743 thousands of U.S. dollars were located in Argentina and subject to restrictions on our ability to transfer them out of the country.
Capital Management
Our capital management goal is to determine the financial resources necessary to continue our recurring activities and maintain a capital structure that optimizes own and borrowed funds. Additionally, we set an optimal debt level in order to maintain a flexible and comfortable medium-term borrowing structure in order to carry out our routine activities under normal conditions and to address new opportunities for growth. We strive to maintain debt levels in line with forecasted future cash flows and with quantitative restrictions imposed under financing contracts.
In addition to these general guidelines, we take into account other considerations and specifics when determining our financial structure, such as country risk, tax efficiency and volatility in cash flow generation.
At the date of these interim financial statements, we are compliant with and other established in our financing contracts. In order to monitor our compliance with our financing contracts, we regularly monitor figures for net financial debt with third parties and EBITDA.
5.2 Fair value estimation
The table below shows an analysis of the financial instruments measured at fair value, classified according to the valuation method used. The Atento Group has defined the following valuation levels:
Prices (unadjusted) quoted in active markets for identical assets and liabilities (Level 1).
Data other than the Level 1 quoted price that are observable for the asset or liability, either directly (i.e. prices) or indirectly (i.e. price derivatives) (Level 2).
Data for the asset or liability that are not based on observable market data (Level 3).
 
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The Atento Group’s assets and liabilities measured at fair value as of December 31, 2013 and June 30, 2014 are as follows:

December 31, 2013
(Audited)	  	Level 1	 	  	Level 2	 	 	Level 3	 	 	Total
balance	 	
Assets	  				  				 				 				
Derivatives	  	 	—	  	  	 	18,296	  	 	 	—	  	 	 	18,296	  	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
Total assets	  	 	—	  	  	 	18,296	  	 	 	—	  	 	 	18,296	  	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
Liabilities	  				  				 				 				
Derivatives	  	 	—	  	  	 	(15,962	) 	 	 	—	  	 	 	(15,962	) 	
CVIs	  	 	—	  	  	 	—	  	 	 	(43,367	) 	 	 	(43,367	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
Total liabilities	  	 	—	  	  	 	(15,962	) 	 	 	(43,367	) 	 	 	(59,329	) 	

																	
June 30, 2014
(Unaudited)	  	Level 1	 	  	Level 2	 	 	Level 3	 	 	Total
balance	 	
Assets	  	 	—	  	  				 	 	—	  	 				
Derivatives	  	 	—	  	  	 	12,051	  	 	 	—	  	 	 	12,051	  	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
Total assets	  	 	—	  	  	 	12,051	  	 	 	—	  	 	 	12,051	  	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
Liabilities	  				  				 				 				
Derivatives	  	 	—	  	  	 	(19,535	) 	 	 	—	  	 	 	(19,535	) 	
CVIs	  	 	—	  	  	 	—	  	 	 	(36,417	) 	 	 	(36,417	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
Total liabilities	  	 	—	  	  	 	(19,535	) 	 	 	(36,417	) 	 	 	(55,952	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
There were no transfers between the different levels during the period.
The following table reflects the movements of the Atento Group´s Contingent Value Instruments (“CVI”) measured at fair value using significant unobservable inputs for the six months period ended June 30, 2014:

 	  	Thousands of
U.S. dollars	 	
Fair value as of December 31, 2013 (Audited)	  	 	(43,367	) 	
Change in Fair Value	  	 	(3,197	) 	
Translation differences	  	 	10,147	  	
	  	 	 	 	
Fair value as of June 30, 2014 (Unaudited)	  	 	(36,417	) 	

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6. SEGMENT INFORMATION
The following tables present financial information for the Atento Group’s operating segments for the six months ended June 30, 2013 and 2014 (in thousands of U.S. dollars).

Six months ended June 30, 2013
(Unaudited)	  	EMEA	 	 	Americas	 	 	Brazil	 	 	Others and
eliminations	 	 	Total Group	 	
Sales to other companies	  	 	58,764	  	 	 	191,065	  	 	 	344,934	  	 	 	—	  	 	 	594,763	  	
Sales to Telefónica Group	  	 	126,823	  	 	 	183,933	  	 	 	261,552	  	 	 	—	  	 	 	572,308	  	
Sales to other group companies	  	 	35	  	 	 	343	  	 	 	—	  	 	 	(378	) 	 	 	—	  	
Other operating income and expense	  	 	(172,472	) 	 	 	(328,067	) 	 	 	(540,704	) 	 	 	(24,121	) 	 	 	(1,065,364	) 	
EBITDA	  	 	13,150	  	 	 	47,274	  	 	 	65,782	  	 	 	(24,499	) 	 	 	101,707	  	
Depreciation and amortization	  	 	(11,909	) 	 	 	(23,858	) 	 	 	(29,752	) 	 	 	(485	) 	 	 	(66,004	) 	
Operating income	  	 	1,241	  	 	 	23,416	  	 	 	36,030	  	 	 	(24,984	) 	 	 	35,703	  	
Financial results	  	 	(11,326	) 	 	 	(5,963	) 	 	 	(23,293	) 	 	 	(20,308	) 	 	 	(60,890	) 	
Income tax	  	 	6,701	  	 	 	(10,374	) 	 	 	(4,322	) 	 	 	10,069	  	 	 	2,074	  	
Profit/(loss) for the period	  	 	(3,384	) 	 	 	7,079	  	 	 	8,415	  	 	 	(35,223	) 	 	 	(23,113	) 	
						
EBITDA	  	 	13,150	  	 	 	47,274	  	 	 	65,782	  	 	 	(24,499	) 	 	 	101,707	  	
Acquisition and integration costs	  	 	47	  	 	 	615	  	 	 	697	  	 	 	11,432	  	 	 	12,791	  	
Restructuring costs	  	 	215	  	 	 	1,155	  	 	 	—	  	 	 	199	  	 	 	1,569	  	
Sponsor management fees	  	 	—	  	 	 	—	  	 	 	—	  	 	 	3,480	  	 	 	3,480	  	
Site relocation costs	  	 	—	  	 	 	—	  	 	 	344	  	 	 	—	  	 	 	344	  	
Financing fees	  	 	—	  	 	 	—	  	 	 	231	  	 	 	2,955	  	 	 	3,186	  	
Other	  	 	—	  	 	 	—	  	 	 	821	  	 	 	—	  	 	 	821	  	
Adjusted EBITDA	  	 	13,412	  	 	 	49,044	  	 	 	67,875	  	 	 	(6,433	) 	 	 	123,898	  	
						
Capital expenditure	  	 	1,858	  	 	 	7,087	  	 	 	19,274	  	 	 	448	  	 	 	28,667	  	
Fixed assets (as of December 31, 2013)	  	 	136,916	  	 	 	303,329	  	 	 	377,933	  	 	 	3,941	  	 	 	822,119	  	
Allocated assets (as of December 31, 2013)	  	 	535,645	  	 	 	694,931	  	 	 	853,018	  	 	 	(240,874	) 	 	 	1,842,180	  	
Allocated liabilities (as of December 31, 2013)	  	 	361,576	  	 	 	398,067	  	 	 	661,039	  	 	 	555,464	  	 	 	1,976,146	  	
 
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Six months ended June 30, 2014
(Unaudited)	  	EMEA	 	 	Americas	 	 	Brazil	 	 	Others and
eliminations	 	 	Total Group	 	
Sales to other companies	  	 	69,284	  	 	 	199,243	  	 	 	345,807	  	 	 	—	  	 	 	614,334	  	
Sales to Telefónica Group	  	 	113,756	  	 	 	172,844	  	 	 	252,684	  	 	 	—	  	 	 	539,284	  	
Sales to other group companies	  	 	23	  	 	 	252	  	 	 	—	  	 	 	(275	) 	 	 	—	  	
Other operating income and expense	  	 	(221,869	) 	 	 	(326,921	) 	 	 	(528,490	) 	 	 	17,546	  	 	 	(1,059,734	) 	
EBITDA	  	 	(38,806	) 	 	 	45,418	  	 	 	70,001	  	 	 	17,271	  	 	 	93,884	  	
Depreciation and amortization	  	 	(11,621	) 	 	 	(21,661	) 	 	 	(27,811	) 	 	 	(529	) 	 	 	(61,622	) 	
Operating income	  	 	(50,427	) 	 	 	23,757	  	 	 	42,190	  	 	 	16,742	  	 	 	32,262	  	
Financial results	  	 	(6,999	) 	 	 	(2,417	) 	 	 	(27,832	) 	 	 	(29,868	) 	 	 	(67,116	) 	
Income tax	  	 	16,256	  	 	 	(7,716	) 	 	 	(4,805	) 	 	 	6,808	  	 	 	10,543	  	
Profit/(loss) for the period	  	 	(41,170	) 	 	 	13,624	  	 	 	9,553	  	 	 	(6,318	) 	 	 	(24,311	) 	
						
EBITDA	  	 	(38,806	) 	 	 	45,418	  	 	 	70,001	  	 	 	17,271	  	 	 	93,884	  	
Acquisition and integration costs	  	 	—	  	 	 	—	  	 	 	5,831	  	 	 	(416	) 	 	 	5,415	  	
Restructuring costs	  	 	16,928	  	 	 	4,123	  	 	 	290	  	 	 	210	  	 	 	21,551	  	
Sponsor management fees	  	 	—	  	 	 	—	  	 	 	—	  	 	 	4,827	  	 	 	4,827	  	
Site relocation costs	  	 	—	  	 	 	—	  	 	 	984	  	 	 	—	  	 	 	984	  	
Financing fees	  	 	—	  	 	 	—	  	 	 	435	  	 	 	7,188	  	 	 	7,623	  	
Impairment charges	  	 	32,866	  	 	 	—	  	 	 	—	  	 	 	—	  	 	 	32,866	  	
Other (*)	  	 	(49	) 	 	 	77	  	 	 	(657	) 	 	 	(34,881	) 	 	 	(35,510	) 	
Adjusted EBITDA	  	 	10,939	  	 	 	49,618	  	 	 	76,884	  	 	 	(5,801	) 	 	 	131,640	  	
						
Capital expenditure	  	 	2,534	  	 	 	9,703	  	 	 	28,184	  	 	 	167	  	 	 	40,588	  	
Fixed assets	  	 	93,532	  	 	 	278,727	  	 	 	402,352	  	 	 	3,546	  	 	 	778,157	  	
Allocated assets	  	 	505,903	  	 	 	669,788	  	 	 	927,788	  	 	 	(279,255	) 	 	 	1,824,224	  	
Allocated liabilities	  	 	366,702	  	 	 	383,435	  	 	 	717,856	  	 	 	519,714	  	 	 	1,987,707	  	

(*)	Other includes the non-cash penalty fee that Telefónica agreed to compensate us after the amendment to the MSA described in Note 7.	
“Other and eliminations” caption includes activities of the Company, the following intermediate holdings in Luxembourg and Spain: Atento Luxco 1, S.A., Atento Spain Holdco S.L.U. and Global Rossolimo S.L.U and intragroup eliminations between segments.
During the six months ended June 30, 2014 approximately 46.7% of sales arose from services provided to companies belonging to the Telefónica Group (49.0% for the six months ended June 30, 2013).
7. INTANGIBLE ASSETS, PROPERTY, PLANT AND EQUIPMENT AND GOODWILL
The movements in “Intangible assets” and “Property, plant and equipment” in the six months ended June 30, 2014 are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	Intangible assets	 	 	Property, plant
and equipment	 	 	Total	 	
Balance at December 31, 2013 (Audited)	  	 	392,777	  	 	 	231,603	  	 	 	624,380	  	
Additions	  	 	7,249	  	 	 	33,339	  	 	 	40,588	  	
Disposals	  	 	(99	) 	 	 	(449	) 	 	 	(548	) 	
Transfers	  	 	143	  	 	 	(143	) 	 	 	—	  	
Impairment charges	  	 	(27,965	) 	 	 	—	  	 	 	(27,965	) 	
Depreciation and amortization	  	 	(32,096	) 	 	 	(29,526	) 	 	 	(61,622	) 	
Translation differences	  	 	7,385	  	 	 	8,271	  	 	 	15,656	  	
	  	 	 	 	 	 	 	 	 	 	 	 	
Balance at June 30, 2014 (Unaudited)	  	 	347,394	  	 	 	243,095	  	 	 	590,489	  	

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Additions
In the six months ended June 30, 2014, investments amounting to 28,184 thousand U.S. dollars were made in Brazil for the construction of new sites in order to be able to attend the growth with current and new clients in that country.
In the six months ended June 30, 2014, investments amounting to 9,703 thousand U.S. dollars were made in Americas mainly in Perú (2,407 thousand U.S. dollars), México (3,615 thousand U.S. dollars) and Central America (2,744 thousand U.S. dollars). The investments in Central America were made for the construction of a new site dedicated to attend nearshore traffic from U.S.A.
Finally, in the six months ended June 30, 2014 there are no significant investments in EMEA and they were mainly dedicated on new clients.
The movement in “Goodwill” in the six months ended June 30, 2014 is as follows:

 	  	Thousands of U. S. dollars	 	
 	  	12/31/2013	 	  	Impairment	 	 	Translation
differences	 	 	06/30/2014
(unaudited)	 	
Peru	  	 	34,185	  	  	 	—	  	 	 	775	  	 	 	34,960	  	
Chile	  	 	21,910	  	  	 	—	  	 	 	(1,014	) 	 	 	20,896	  	
Colombia	  	 	9,681	  	  	 	—	  	 	 	212	  	 	 	9,893	  	
Czech Republic	  	 	3,797	  	  	 	(3,752	) 	 	 	(45	) 	 	 	—	  	
Mexico	  	 	2,816	  	  	 	—	  	 	 	25	  	 	 	2,841	  	
Spain	  	 	1,161	  	  	 	(1,149	) 	 	 	(12	) 	 	 	—	  	
Brazil	  	 	77,920	  	  	 	—	  	 	 	4,957	  	 	 	82,877	  	
Argentina	  	 	46,269	  	  	 	—	  	 	 	(10,068	) 	 	 	36,201	  	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
Total	  	 	197,739	  	  	 	(4,901	) 	 	 	(5,170	) 	 	 	187,668	  	
	  	 	 	 	  	 	 	 	 	 	 	 	 	 	 	 	
Impairment charges
Goodwill impairment reviews are undertaken annually or more frequently if events or changes in circumstances indicate a potential impairment.
Tests conducted in 2013 on Atento companies with goodwill did not uncover any impairment in their value, as the related cash flows exceeded the carrying amount of the cash-generating units.
In addition, a sensitivity analysis was performed on changes that could reasonably be expected to occur in the primary valuation inputs, with the recoverable amount remaining above the net carrying amount.
In May 2014, the Master Service Agreement (“MSA”) with Telefónica, which required the Telefónica Group companies to meet pre-agreed minimum annual revenue commitments to us through 2021, was amended to adjust such minimum revenue commitments in relation to Spain and Morocco, to reflect the expected lower level of activities in these geographies. The provisions of the MSA required Telefonica to compensate the company in case of shortfalls in these revenue commitments. As such, Telefónica agreed to compensate the Company with a non-cash penalty fee amounting to €25.4 million (equivalent to $34.9 million for the period ended June 30, 2014). This non-cash compensation was recorded in the consolidated income statement for the period ended June 30, 2014 as other gains. The Company, in turn, used this amount to partially reduce and compensate the Vendor Loan Note with Telefonica (see Note 10).
Since the amendment to the MSA affected significantly the amount of expected revenue, this has been considered as a triggering event for the purpose of evaluating the recoverable amount of the intangible assets
 
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recorded in relation with such MSA (as described in Note 5 to the Consolidated Financial Statements for the year ended December 31, 2013). Therefore, also considering the changes in expected revenue in other geographies, as of June 30, 2014 management has performed an impairment test on the carrying amount of customer relationship intangible assets, goodwill and property, plant and equipment using assumptions revised in accordance with the amendments to the MSA and with updated management expectations on cash flows generation from the different geographies where the company operates. The result of the test performed was an impairment charge of 27,965 thousand U.S. dollars of the intangible asset related to the customer relationship with Telefonica in connection with the MSA, an impairment charge of 3,752 thousand U.S. dollars of goodwill in Czech Republic and of 1,149 thousand U.S. dollars of goodwill in Spain, which have been recorded in the consolidated income statement for the period ended June 30, 2014 as impairment charges.
The pre-tax discount rates and the projected growth rates were as follows:

 	  	Discount rate	 	
	  	Brazil	 	 	Mexico	 	 	Spain	 	 	Colombia	 	 	Peru	 	 	Chile	 	 	Czech
Republic	 	 	Argentina	 	
June 2014	  	 	16.53	% 	 	 	12.21	% 	 	 	10.38	% 	 	 	12.50	% 	 	 	11.37	% 	 	 	11.27	% 	 	 	9.52	% 	 	 	31.77	% 	
December 2013	  	 	16.53	% 	 	 	12.21	% 	 	 	10.38	% 	 	 	12.50	% 	 	 	11.37	% 	 	 	11.27	% 	 	 	9.52	% 	 	 	31.77	% 	
		
 	  	Growth rate	 	
 	  	Brazil	 	 	Mexico	 	 	Spain	 	 	Colombia	 	 	Peru	 	 	Chile	 	 	Czech
Republic	 	 	Argentina	 	
June 2014	  	 	5.50	% 	 	 	3.10	% 	 	 	1.50	% 	 	 	3.00	% 	 	 	2.50	% 	 	 	3.00	% 	 	 	2.03	% 	 	 	8.76	% 	
December 2013	  	 	5.50	% 	 	 	3.10	% 	 	 	1.85	% 	 	 	3.00	% 	 	 	2.50	% 	 	 	3.00	% 	 	 	2.03	% 	 	 	16.83	% 	
As of June 30, 2014, there are no significant changes to the sensitivity information disclosed in the annual consolidated financial statements for the year ended December 31, 2013.
The Atento Group has no assets with an indefinite useful life and therefore carries out no impairment tests of this type.
8. EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT
Share capital
At June 30, 2014 and December 31, 2013 share capital stood at 2,592,201 U.S. dollars, divided into 2,000,000 shares with a par value of 1 euro each, fully paid in.
On April 17, 2014, Atalaya Luxco Pikco, S.C.A. was formed as a direct subsidiary of Atalaya Luxco Topco, S.C.A. On May 15, 2014 Atalaya Luxco Topco, S.C.A. transferred to Atalaya Luxco Pikco, S.C.A. all of its equity interest in the Company. As a result, Atalaya Luxco Pikco, S.C.A. became the shareholder of the Company.
Legal reserve
According to mercantile legislation in Luxembourg, Atalaya Luxco Midco, S.a.r.l. must transfer 5% of profits for the year to a legal reserve until the reserve reaches 10% of share capital. The legal reserve cannot be distributed.
As of June 30, 2014 and December 31, 2013, no legal reserve had been established.
 
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Retained earnings
Movements in retained earnings during the six months ended June 30, 2014 are as follows:

 	  	Thousands of
U.S. dollars	 	
As of December 31, 2013 (Audited)	  	 	(60,659	) 	
Loss for the period	  	 	(24,311	) 	
	  	 	 	 	
As of June 30, 2014 (Unaudited)	  	 	(84,970	) 	
	  	 	 	 	
Translation differences
Translation differences reflect the differences arising on account of exchange rate fluctuations when converting the net assets of fully consolidated foreign companies from local currency to the Atento Group’s presentation currency (U.S. dollars) by the full consolidation method.
Valuation adjustments
Movements in valuation adjustments in the six months ended June 30, 2014 were as follows:

 	  	Thousands of
U.S. dollars	 	
As of December 31, 2013 (Audited)	  	 	1,627	  	
Cash flow hedges	  	 	(5,324	) 	
	  	 	 	 	
As of June 30, 2014 (Unaudited)	  	 	(3,697	) 	
	  	 	 	 	
9. FINANCIAL ASSETS
The breakdown of the Company’s financial assets by category as of December 31, 2013 and June 30, 2014 is as follows:

 	  	Thousands of U.S. dollars	 	
December 31, 2013
(Audited)	  	Loans and
receivables	 	  	Derivatives	 	  	Total	 	
Trade and other receivables	  	 	72	  	  	 	—	  	  	 	72	  	
Other financial assets	  	 	53,812	  	  	 	—	  	  	 	53,812	  	
Financial derivative instruments	  	 	—	  	  	 	15,439	  	  	 	15,439	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Non-current financial assets	  	 	53,884	  	  	 	15,439	  	  	 	69,323	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Trade and other receivables	  	 	516,960	  	  	 	—	  	  	 	516,960	  	
Other financial assets	  	 	1,425	  	  	 	—	  	  	 	1,425	  	
Financial derivative instruments	  	 	—	  	  	 	2,857	  	  	 	2,857	  	
Cash and cash equivalents	  	 	213,491	  	  	 	—	  	  	 	213,491	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Current financial assets	  	 	731,876	  	  	 	2,857	  	  	 	734,733	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
TOTAL FINANCIAL ASSETS	  	 	785,760	  	  	 	18,296	  	  	 	804,056	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Excluding advance payments and non-financial assets.
 
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 	  	Thousands of U.S. dollars	 	
June 30, 2014
(Unaudited)	  	Loans and
receivables	 	  	Derivatives	 	  	Total	 	
Trade and other receivables	  	 	77	  	  	 	—	  	  	 	77	  	
Other financial assets	  	 	52,129	  	  	 	—	  	  	 	52,129	  	
Financial derivative instruments	  	 	—	  	  	 	10,080	  	  	 	10,080	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Non-current financial assets	  	 	52,206	  	  	 	10,080	  	  	 	62,286	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Trade and other receivables	  	 	507,080	  	  	 	—	  	  	 	507,080	  	
Other financial assets	  	 	60,805	  	  	 	—	  	  	 	60,805	  	
Financial derivative instruments	  	 	—	  	  	 	1,971	  	  	 	1,971	  	
Cash and cash equivalents	  	 	178,249	  	  	 	—	  	  	 	178,249	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Current financial assets	  	 	746,134	  	  	 	1,971	  	  	 	748,105	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
TOTAL FINANCIAL ASSETS	  	 	798,340	  	  	 	12,051	  	  	 	810,391	  	
	  	 	 	 	  	 	 	 	  	 	 	 	
Excluding advance payments and non-financial assets.
Details of other financial assets as of December 31, 2013 and June 30, 2014 are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	12/31/2013
(Audited)	 	  	06/30/2014
(Unaudited)	 	
Other non-current receivables	  	 	2,428	  	  	 	—	  	
Non-current guarantees and deposits	  	 	51,384	  	  	 	52,129	  	
	  	 	 	 	  	 	 	 	
Total non-current	  	 	53,812	  	  	 	52,129	  	
Other current receivables	  	 	—	  	  	 	59,492	  	
Current guarantees and deposits	  	 	1,425	  	  	 	1,313	  	
	  	 	 	 	  	 	 	 	
Total current	  	 	1,425	  	  	 	60,805	  	
	  	 	 	 	  	 	 	 	
Total	  	 	55,237	  	  	 	112,934	  	
	  	 	 	 	  	 	 	 	
“Guarantees and deposits” as of December 31, 2013 and June 30, 2014 primarily comprise deposits posted with the courts in respect of legal disputes with employees of the subsidiary Atento Brasil, S.A. and for litigation underway with the Brazilian social security authority (Instituto Nacional do Seguro Social).
“Other current receivables” as of June 30, 2014 are comprised of 59,487 thousand U.S. dollars representing U.S. dollar short term financial investments held by the subsidiary Atento Brasil, S.A.
These short term financial investments represent export credit notes with a maturity greater than 90 days. Upon maturity the Company will receive Brazilian Reais based on the U.S. dollar—Brazilian Reais foreign exchange rate at maturity date.
 
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The breakdown of “Trade and other receivables” as of December 31, 2013 and June 30, 2014 is as follows:

 	  	Thousands of U.S. dollars	 	
 	  	12/31/2013
(Audited)	 	  	06/30/2014
(Unaudited)	 	
Non-current trade receivables	  	 	72	  	  	 	77	  	
	  	 	 	 	  	 	 	 	
Total non-current	  	 	72	  	  	 	77	  	
Current trade receivables	  	 	492,900	  	  	 	484,424	  	
Other receivables	  	 	12,540	  	  	 	10,069	  	
Prepayments	  	 	4,326	  	  	 	12,628	  	
Personnel	  	 	11,520	  	  	 	12,587	  	
	  	 	 	 	  	 	 	 	
Total current	  	 	521,286	  	  	 	519,708	  	
	  	 	 	 	  	 	 	 	
Total	  	 	521,358	  	  	 	519,785	  	
	  	 	 	 	  	 	 	 	
For the purpose of the interim financial statements of cash flows, cash and cash equivalents are comprised of the following:

 	  	Thousands of U.S. dollars	 	
 	  	12/31/2013
(Audited)	 	  	06/30/2014
(Unaudited)	 	
Cash and cash equivalents at banks	  	 	168,287	  	  	 	168,303	  	
Cash equivalents	  	 	45,204	  	  	 	9,946	  	
	  	 	 	 	  	 	 	 	
Total	  	 	213,491	  	  	 	178,249	  	
	  	 	 	 	  	 	 	 	
“Cash equivalents” comprises short-term fixed-income securities in Brazil, which mature in less than 90 days and accrue interest pegged to the CDI.
10. FINANCIAL LIABILITIES
The breakdown of the Company’s financial liabilities by category as of December 31, 2013 and June 30, 2014 is as follows:

 	  	Thousands of U.S. dollars	 	
December 31, 2013
(Audited)	  	Liabilities
through profit
and loss	 	  	Derivatives	 	  	Other financial
liabilities at
amortized cost	 	  	Total	 	
Debentures and bonds	  	 	—	  	  	 	—	  	  	 	631,853	  	  	 	631,853	  	
Bank borrowings	  	 	—	  	  	 	—	  	  	 	527	  	  	 	527	  	
Finance lease payables	  	 	—	  	  	 	—	  	  	 	6,536	  	  	 	6,536	  	
CVIs	  	 	43,367	  	  	 	—	  	  	 	—	  	  	 	43,367	  	
Vendor Loan	  	 	—	  	  				  	 	151,701	  	  	 	151,701	  	
Payable to Group companies	  	 	—	  	  	 	—	  	  	 	519,607	  	  	 	519,607	  	
Financial derivative instruments	  	 	—	  	  	 	15,962	  	  	 	—	  	  	 	15,962	  	
Trade and other payables	  	 	—	  	  	 	—	  	  	 	1,033	  	  	 	1,033	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Non-current financial liabilities	  	 	43,367	  	  	 	15,962	  	  	 	1,311,257	  	  	 	1,370,586	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Debentures and bonds	  	 	—	  	  	 	—	  	  	 	11,682	  	  	 	11,682	  	
Bank borrowings	  	 	—	  	  	 	—	  	  	 	105	  	  	 	105	  	
Finance lease payables	  	 	—	  	  	 	—	  	  	 	5,341	  	  	 	5,341	  	
Trade and other payables	  	 	—	  	  	 	—	  	  	 	269,789	  	  	 	269,789	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Current financial liabilities	  	 	—	  	  	 	—	  	  	 	286,917	  	  	 	286,917	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
TOTAL FINANCIAL LIABILITIES	  	 	43,367	  	  	 	15,962	  	  	 	1,598,174	  	  	 	1,657,503	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Excluding deferred income and non-financial liabilities
 
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 	  	Thousands of U.S. dollars	 	
June 30, 2014
(Unaudited)	  	Liabilities
through profit
and loss	 	  	Derivatives	 	  	Other financial
liabilities at
amortized cost	 	  	Total	 	
Debentures and bonds	  	 	—	  	  	 	—	  	  	 	620,119	  	  	 	620,119	  	
Bank borrowings	  	 	—	  	  	 	—	  	  	 	36,880	  	  	 	36,880	  	
Finance lease payables	  	 	—	  	  	 	—	  	  	 	5,699	  	  	 	5,699	  	
CVIs	  	 	36,417	  	  	 	—	  	  	 	—	  	  	 	36,417	  	
Vendor Loan	  	 	—	  	  	 	—	  	  	 	31,281	  	  	 	31,281	  	
Payable to Group companies	  	 	—	  	  	 	—	  	  	 	620,705	  	  	 	620,705	  	
Financial derivative instruments	  	 	—	  	  	 	19,535	  	  	 	—	  	  	 	19,535	  	
Trade and other payables	  	 	—	  	  	 	—	  	  	 	723	  	  	 	723	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Non-current financial liabilities	  	 	36,417	  	  	 	19,535	  	  	 	1,315,407	  	  	 	1,371,359	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Debentures and bonds	  	 	—	  	  	 	—	  	  	 	10,081	  	  	 	10,081	  	
Bank borrowings	  	 	—	  	  	 	—	  	  	 	488	  	  	 	488	  	
Vendor Loan	  	 	—	  	  	 	—	  	  	 	138	  	  	 	138	  	
Finance lease payables	  	 	—	  	  	 	—	  	  	 	4,196	  	  	 	4,196	  	
Trade and other payables	  	 	—	  	  	 	—	  	  	 	282,215	  	  	 	282,215	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Current financial liabilities	  	 	—	  	  	 	—	  	  	 	297,118	  	  	 	297,118	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
TOTAL FINANCIAL LIABILITIES	  	 	36,417	  	  	 	19,535	  	  	 	1,612,525	  	  	 	1,668,477	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Excluding deferred income and non-financial liabilities
Interest-bearing debt as of December 31, 2013 and June 30, 2014 is as follows:

 	  	Thousands of U.S. dollars	 	
	  	12/31/2013
(Audited)	 	  	06/30/2014
(Unaudited)	 	
Senior Secured Notes	  	 	288,339	  	  	 	290,216	  	
Brazilian bonds—Debentures	  	 	343,514	  	  	 	329,903	  	
Bank borrowings	  	 	527	  	  	 	36,880	  	
CVIs	  	 	43,367	  	  	 	36,417	  	
Vendor Loan	  	 	151,701	  	  	 	31,281	  	
Finance lease payables	  	 	6,536	  	  	 	5,699	  	
	  	 	 	 	  	 	 	 	
Sub-total borrowings with third parties	  	 	833,984	  	  	 	730,396	  	
Payable to Group companies	  	 	519,607	  	  	 	620,705	  	
	  	 	 	 	  	 	 	 	
Total non-current	  	 	1,353,591	  	  	 	1,351,101	  	
	  	 	 	 	  	 	 	 	
Senior Secured Notes	  	 	9,342	  	  	 	9,342	  	
Brazilian bonds—Debentures	  	 	2,340	  	  	 	739	  	
Bank borrowings	  	 	105	  	  	 	488	  	
Vendor Loan	  	 	—	  	  	 	138	  	
Finance lease payables	  	 	5,341	  	  	 	4,196	  	
	  	 	 	 	  	 	 	 	
Sub-total borrowings with third parties	  	 	17,128	  	  	 	14,903	  	
	  	 	 	 	  	 	 	 	
Total current	  	 	17,128	  	  	 	14,903	  	
	  	 	 	 	  	 	 	 	
TOTAL INTEREST-BEARING DEBT	  	 	1,370,719	  	  	 	1,366,004	  	
	  	 	 	 	  	 	 	 	
Issuance of bonds—Senior Secured Notes
 
 	•	 	On January 29, 2013 Atento Luxco 1, S.A. issued 300,000 bonds with a nominal value of 1,000 U.S. dollars each, bearing interest at an annual rate of 7.375%. The bonds mature on January 29, 2020, and the issuer may redeem them early as of January 29, 2016, if certain conditions have been met.	
 
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Details of the senior secured notes issuances at June 30, 2014 are as follows:

Issuer	  	Issue date	 	  	Number of
bonds	 	  	Unit nominal Value	 	  	Annual
interest rate	 	 	Maturity	 	
Atento Luxco 1, S.A.	  	 	January 29, 2013	  	  	 	300,000	  	  	 	1,000 U.S. dollars	  	  	 	7.375	% 	 	 	January 29, 2020	  	
All interest payments are made on a half-yearly basis.
Fair value of debt in relation to the issuance of senior secured notes, calculated on the basis of their quoted price at June 30, 2014, is 308,264 thousand U.S. dollars.
The fair value hierarchy of the senior secured notes is level 1 as it based in the market price at the reporting date.
Details of the corresponding debt at each reporting date are as follows:

Thousands of U.S. dollars	 	
 	  	 	 	  	12/31/2013
(Audited)	 	  	06/30/2014
(Unaudited)	 	
Maturity	  	Currency	 	  	Principal	 	  	Accrued
interest	 	  	Total
debt	 	  	Principal	 	  	Accrued
interest	 	  	Total
debt	 	
2020	  	 	U.S. Dollar	  	  	 	288,339	  	  	 	9,342	  	  	 	297,681	  	  	 	290,216	  	  	 	9,342	  	  	 	299,558	  	
	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	
Brazilian bonds—Debentures
 
 	•	 	On November 22, 2012 BC Brazilco Participaçoes, S.A. (now merged with Atento Brasil, S.A.) issued preferential bonds in Brazil (the “ Debentures ”), which were subscribed by institutional investors (the “ Debenture holders ”) and assumed by Bain for an initial amount of 915 million Brazilian reais (365 million U.S. dollars). This long-term financial commitment matures in 2019 and bears interest pegged to the Brazilian CDI (Interbank Deposit Certificate) rate plus 3.70%. Interest is paid on a half-yearly basis.	
On March 25, 2013 and June 11, 2013 Atento Brasil, S.A. repaid, in advance of the scheduled date, 71,589 thousand Brazilian reais and 26,442 thousand Brazilian reais respectively (equivalent to 35,545 thousand U.S. dollars and 12,287 thousand U.S. dollars respectively).
On May 12, 2014 and June 26, 2014 Atento Brasil, S.A. repaid, in advance of the scheduled date, 34,358 thousand Brazilian reais and 45,000 thousand Brazilian reais respectively (equivalent to 15,502 thousand U.S. dollars and 20,372 thousand U.S. dollars respectively).
Under the terms of the financing contract, the Brazilian subsidiary is subject to a financial covenant regarding the maximum debt level at the end of each quarter. To date, the company has complied with this covenant and does not foresee any future non-compliance.
Details of the corresponding debt at each reporting date are as follows:

Thousands of U.S. dollars	 	
 	  	 	 	  	12/31/2013
(Audited)	 	  	06/30/2014
(Unaudited)	 	
Maturity	  	Currency	 	  	Principal	 	  	Interest pending
payment	 	  	Total
debt	 	  	Principal	 	  	Interest pending
payment	 	  	Total
debt	 	
2019	  	 	Brazilian real	  	  	 	343,514	  	  	 	2,340	  	  	 	345,854	  	  	 	329,903	  	  	 	739	  	  	 	330,642	  	
The carrying amount of debentures is similar to the fair value. The fair value is based on cash flows discounted and is within level 2 of the fair value hierarchy.
 
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Bank borrowings
Bank borrowings are held in the following currencies:

 	  	12/31/2013
(Audited)	 	  	06/30/2014
(Unaudited)	 	
 	  	Foreign
currency debt
(thousands)	 	  	U.S. dollar debt
(thousands)	 	  	Foreign
currency debt
(thousands)	 	  	U.S. dollar debt
(thousands)	 	
BRL	  	 	—	  	  	 	—	  	  	 	81,072	  	  	 	36,809	  	
MAD	  	 	5,170	  	  	 	632	  	  	 	4,590	  	  	 	559	  	
	  				  	 	 	 	  				  	 	 	 	
Total	  				  	 	632	  	  				  	 	37,368	  	
	  				  	 	 	 	  				  	 	 	 	
The carrying amount of bank borrowings is similar to the fair value. The fair value is based on cash flows discounted and is within level 2 of the fair value hierarchy.
 
 	•	 	On February 3, 2014, Banco Nacional de Desenvolvimento Economico e Social (BNDES) granted a credit facility to the subsidiary Atento Brasil S.A for BRL 300 million (equivalent to 124 million U.S. dollars). Once the debtor met certain requirements in the signed contract the loan automatically became available for the debtor. On March 27, 2014 BNDES disbursed BRL 56.6 million (equivalent to USD 26 million as of June 30, 2014) of the total facility. On April 16, 2014 BNDES disbursed BRL 23.7 million (equivalent to USD 11 million as of June 30, 2014) of the total facility. As of June 30, 2014, accrued interests amounted to BRL 0.8 million (equivalent to $0.3 million).	
The total amount of the BNDES Credit Facility is divided into 5 tranches in the following amounts and subject to the following interest rates:

 	  	Amount of Each
Tranche	  	Interest Rate	
Tranche A	  	BRL 182,330,000.00	  	Long Term Interest Rate (Taxa de Juros de Longo Prazo—TJLP) plus 2.5% per annum	
			
Tranche B	  	BRL 45,583,000.00	  	SELIC Rate plus 2.5% per annum	
			
Tranche C	  	BRL 64,704,000.00	  	4.0% per year	
			
Tranche D	  	BRL 5,296,000.00	  	6.0% per year	
			
Tranche E	  	BRL 2,048,000.00	  	Long Term Interest Rate (Taxa de Juros de Longo Prazo—TJLP)	
The BNDES Credit Facility is to be repaid in 48 monthly installments. The first payment will be due on March 15, 2016 and the last payment will be due on February 15, 2020.
The BNDES Credit Facility contains covenants that restrict Atento Brasil S.A.’s ability to transfer, assign, charge or sell the intellectual property rights related to technology and products developed by Atento Brasil S.A. with the proceeds from the BNDES Credit Facility.
The BNDES Credit Facility contains customary events of default including the following: (i) reduction of the number of the employees of Atento Brasil S.A. without providing program support for outplacement, as training, job seeking assistance and obtaining pre-approval of BNDES, (ii) existence of an unfavorable court decision against the Company for the use of children as workforce, slavery or any environmental crimes and (iii) inclusion in the by-laws of Atento Brasil S.A. of any provision that restricts Atento Brasil S.A.’s ability to paying its obligations under the BNDES Credit Facility.
 
 	•	 	On January 28, 2013 Atento Luxco 1, S.A., Atento Teleservicios España, S.A.U. and Atento Mexicana, S.A. de C.V. contracted a multi-currency revolving facility (“Super Senior Revolving Credit Facilities Agreement” or “SSRCF”) for 50 million euros (equivalent to 68.3 million U.S. dollars as of June 30, 2014).	
 
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The new revolving facility allows for drawdowns in euros, Mexican pesos and US dollars. The interest rates for euro drawdowns and Mexican peso drawdowns are the Euribor and the TIIE, respectively, and the LIBOR for drawdowns in any other currency, plus a 4.5% spread per year. This spread is subject to a step-down based on the debt ratio calculation.
The revolving facility matures on July 28, 2019. As of June 30, 2014 and December 31, 2013 no amounts had been drawn down on the revolving facility.
 
 	•	 	Atento Maroc, S.A. held a loan granted from Banco Sabadell, at November 30, 2012, 10 million dirhams were repaid in advance of the scheduled date. As of June 30, 2014 the loan balance was 4,590 thousand Moroccan dirham (559 thousand U.S. dollars) (5,082 thousand Moroccan dirham (632 thousand U.S. dollars as of December 31, 2013). The loan matures on June 28, 2016 and bears interest at 6%.	
Contingent Value Instruments (CVIs)
 
 	•	 	In relation to the acquisition described in Note 1, two of the Company’s subholdings, Atalaya Luxco 2, S.a.r.l. (formerly BC Luxco 2, S.a.r.l.) and Atalaya Luxco 3, S.a.r.l. (formerly BC Luxco 3, S.a.r.l.), which held stakes in the Atento Group’s Argentinian subsidiaries, issued a contingent value instrument (CVI) with the counterparties Atento Inversiones y Teleservicios, S.A. and Venturini S.A., a Telefónica’s subsidiary.	
The CVIs do not bear interest and are recognized at fair value. For further information regarding the CVIs, see Note 17 of our consolidated financial statements for the year ended December 31, 2013.
Vendor Loan
 
 	•	 	With respect to the acquisition described in Note 1, the Company issued a euro-denominated Vendor Loan Note (Vendor Loan) to a Telefónica branch, amounting to the equivalent of approximately 143 million U.S. dollars. The Vendor Loan matures at December 12, 2022, and accrues an annual 5% of fixed interest, payable annually.	
As described in Note 7, in May 2014, the Master Service Agreement (“MSA”) with Telefónica was amended and Telefónica agreed to compensate the Company with a non-cash penalty fee amounting to €25.4 million (equivalent to $34.9 million for the period ended June 30, 2014). The company, in turn, used this amount to partially reduce and compensate the Vendor Loan Note with Telefonica.
In addition, in May 30, 2014 Atalaya Luxco Midco has issued €64 million of PECs (equivalent to $87 million) which proceeds were applied to make a partial prepayment of the Vendor Loan Note (See Note 15).
The carrying amount of the Vendor Loan approximately corresponds to its fair value.
The fair value is based on cash flows discounted and is within level 2 of the fair value hierarchy.
Derivatives
Details of derivative financial instruments as of December 31, 2013 and June 30, 2014 are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	12/31/2013
(Audited)	 	 	06/30/2014
(Unaudited)	 	
 	  	Assets	 	  	Liabilities	 	 	Assets	 	  	Liabilities	 	
Interest rate swaps—cash flow hedges	  	 	15,611	  	  	 	—	  	 	 	10,255	  	  				
Cross currency swaps —cash flow hedge	  	 	—	  	  	 	(10,985	) 	 	 	—	  	  	 	(13,247	) 	
Cross currency swaps that do not meet the criteria for hedge accounting	  	 	2,685	  	  	 	(4,977	) 	 	 	1,796	  	  	 	(6,288	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	
Total	  	 	18,296	  	  	 	(15,962	) 	 	 	12,051	  	  	 	(19,535	) 	
	  	 	 	 	  	 	 	 	 	 	 	 	  	 	 	 	
Non-current portion	  	 	15,439	  	  	 	(15,962	) 	 	 	10,080	  	  	 	(19,535	) 	
Current portion	  	 	2,857	  	  	 	—	  	 	 	1,971	  	  	 	—	  	

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The Atento Group has contracted interest rate swaps to hedge fluctuations in interest rates in respect of debentures issued in Brazil.
As of June 30, 2014, the notional amount of principal arranged in the interest rate swaps totals 595 million Brazilian reals equivalent to 270 million U.S. dollars (595 million Brazilian reals equivalent to 254 million U.S. dollars as of December 31, 2013).
The Atento Group has arranged cross-currency swap instruments to cover US dollar payments arising from the senior secured notes issued in 2013.
As of June 30, 2014 details of cross-currency swaps that are designated and qualified as cash flow hedge were as follows:

Bank	 	Date	 	 	Maturity	 	 	Purchase
currency	 	 	Amount
purchased
(thousands)	 	 	Fixed rate
bank
count-party
payment	 	 	Selling
currency	 	 	Amount
sold
(thousands)	 	 	Fixed rate
Atento
payment	 	 	Spot	 	
Santander	 	 	01/29/2013	  	 	 	01/29/2018	  	 	 	USD	  	 	 	738	  	 	 	7.3750	% 	 	 	EUR	  	 	 	560	  	 	 	7.5450	% 	 	 	1.347	  	
Santander	 	 	01/29/2018	  	 	 	01/29/2020	  	 	 	USD	  	 	 	922	  	 	 	7.3750	% 	 	 	EUR	  	 	 	700	  	 	 	7.5450	% 	 	 	1.347	  	
Santander	 	 	01/29/2020	  	 	 	01/29/2020	  	 	 	USD	  	 	 	25,000	  	 	 	7.3750	% 	 	 	EUR	  	 	 	18,560	  	 	 	7.5450	% 	 	 	1.347	  	
Goldman Sachs	 	 	01/29/2013	  	 	 	01/28/2018	  	 	 	USD	  	 	 	48,000	  	 	 	7.3750	% 	 	 	EUR	  	 	 	35,635	  	 	 	7.5475	% 	 	 	1.347	  	
Goldman Sachs	 	 	01/29/2018	  	 	 	01/29/2020	  	 	 	USD	  	 	 	60,000	  	 	 	7.3750	% 	 	 	EUR	  	 	 	44,543	  	 	 	7.5475	% 	 	 	1.347	  	
Nomura	 	 	01/29/2013	  	 	 	01/28/2018	  	 	 	USD	  	 	 	22,000	  	 	 	7.3750	% 	 	 	EUR	  	 	 	16,333	  	 	 	7.6050	% 	 	 	1.347	  	
Nomura	 	 	01/29/2018	  	 	 	01/29/2020	  	 	 	USD	  	 	 	27,500	  	 	 	7.3750	% 	 	 	EUR	  	 	 	20,416	  	 	 	7.6050	% 	 	 	1.347	  	
Gains and losses on interest rate swap hedges recognized in equity will be taken to the income statement up through maturity of the corresponding contracts as disclosed in the table above.
There were no ineffective hedge derivatives in the six months ended June 30, 2014.
The Atento Group also contracted the following cross currency swaps that are not designated and qualified as hedging instruments:

Bank	 	Date	 	 	Maturity	 	 	Purchase
currency	 	 	Amount
purchased
(thousands)	 	 	Fixed rate
bank
count-party
payment	 	 	Selling
currency	 	 	Amount sold
(thousands)	 	 	Fixed rate
Atento
payment	 	 	Spot	 	
Santander	 	 	01/29/2013	  	 	 	01/29/2018	  	 	 	USD	  	 	 	410	  	 	 	7.3750	% 	 	 	MXN	  	 	 	9,144	  	 	 	12.9500	% 	 	 	12.71	  	
Santander	 	 	01/29/2018	  	 	 	01/29/2020	  	 	 	USD	  	 	 	615	  	 	 	7.3750	% 	 	 	MXN	  	 	 	13,716	  	 	 	12.9500	% 	 	 	12.71	  	
Santander	 	 	01/29/2020	  	 	 	01/29/2020	  	 	 	USD	  	 	 	16,667	  	 	 	7.3750	% 	 	 	MXN	  	 	 	211,833	  	 	 	12.9500	% 	 	 	12.71	  	
Goldman Sachs	 	 	01/29/2013	  	 	 	01/28/2018	  	 	 	USD	  	 	 	40,000	  	 	 	7.3750	% 	 	 	MXN	  	 	 	508,400	  	 	 	12.9120	% 	 	 	12.71	  	
Goldman Sachs	 	 	01/29/2018	  	 	 	01/29/2020	  	 	 	USD	  	 	 	60,000	  	 	 	7.3750	% 	 	 	MXN	  	 	 	762,600	  	 	 	12.9120	% 	 	 	12.71	  	
Nomura	 	 	01/29/2013	  	 	 	01/28/2018	  	 	 	USD	  	 	 	23,889	  	 	 	7.3750	% 	 	 	MXN	  	 	 	303,628	  	 	 	12.9000	% 	 	 	12.71	  	
Nomura	 	 	01/29/2018	  	 	 	01/29/2020	  	 	 	USD	  	 	 	35,833	  	 	 	7.3750	% 	 	 	MXN	  	 	 	455,442	  	 	 	12.9000	% 	 	 	12.71	  	
Goldman Sachs	 	 	01/29/2013	  	 	 	01/29/2018	  	 	 	USD	  	 	 	7,200	  	 	 	7.3750	% 	 	 	COP	  	 	 	12,819,600	  	 	 	8.2150	% 	 	 	1780.5	  	
Goldman Sachs	 	 	01/29/2013	  	 	 	01/29/2018	  	 	 	USD	  	 	 	13,800	  	 	 	7.3750	% 	 	 	PEN	  	 	 	35,356	  	 	 	7.7900	% 	 	 	2.562	  	
BBVA	 	 	01/29/2013	  	 	 	01/29/2018	  	 	 	USD	  	 	 	28,800	  	 	 	7.3750	% 	 	 	COP	  	 	 	51,278,400	  	 	 	8.2160	% 	 	 	1780.5	  	
BBVA	 	 	01/29/2013	  	 	 	01/29/2018	  	 	 	USD	  	 	 	52,200	  	 	 	7.3750	% 	 	 	PEN	  	 	 	141,422	  	 	 	7.7800	% 	 	 	2.625	  	
During the six months ended June 30, 2014, variations in fair value of the derivative financial instruments that are not considered as hedging derivatives recorded under the income statement amount to a net loss of 5,839 thousand U.S. dollars (net gain of 1,285 thousand U.S. dollars in 2013).
 
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11. PROVISIONS AND CONTINGENCIES
The movements in “Provisions” in the six months ended June 30, 2014 are as follows:

 	  	Thousands of U.S. dollars	 	
 	  	Provisions for
liabilities	 	 	Provisions
for taxes	 	 	Provisions
for
dismantling	 	 	Other
provisions	 	 	Total	 	
Balance at December 31, 2013 (Audited)	  	 	80,008	  	 	 	11,229	  	 	 	15,675	  	 	 	6,668	  	 	 	113,580	  	
Allocation	  	 	7,807	  	 	 	1,089	  	 	 	771	  	 	 	14,533	  	 	 	24,200	  	
Application	  	 	(7,548	) 	 	 	(365	) 	 	 	(48	) 	 	 	(1,671	) 	 	 	(9,632	) 	
Reversals	  	 	(527	) 	 	 	—	  	 	 	—	  	 	 	—	  	 	 	(527	) 	
Discount	  	 	49	  	 	 	1,132	  	 	 	4	  	 	 	2	  	 	 	1,187	  	
Translation differences	  	 	3,448	  	 	 	730	  	 	 	956	  	 	 	(109	) 	 	 	5,025	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Balance at June 30, 2014 (Unaudited)	  	 	83,237	  	 	 	13,815	  	 	 	17,358	  	 	 	19,423	  	 	 	133,833	  	
	  	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
“Provisions for liabilities” primarily relates to provisions for legal claims underway in Brazil. As indicated in Note 9 “Other financial assets”, Atento Brasil, S.A. has made payments in escrow related to legal claims with ex-employees and the Brazilian social security authority (Instituto Nacional do Seguro Social) amounting to 48,690 thousand U.S. dollars and 49,327 thousand U.S. dollars at December 31, 2013 and June 30, 2014, respectively.
“Provisions for taxes” mainly relates to probable contingencies in Brazil in respect of social security payments, which could be subject to varying interpretations by the social security authorities concerned.
The amount recognized under “Provision for dismantling” corresponds to the necessary cost of covering the dismantling process of the installations held under operating leases for those entities contractually required to do so.
On June 26, 2014, the Company communicated to the Labor Unions a headcount reduction plan in Spain (“Expediente de Regulación de Empleo”) which will take into consideration a maximum number of terminations amounting to 9% of the total headcount of Atento Teleservicios España, S.A.U. In addition, on June 28, 2014 the Company submitted the plan to the Labor Authority in Spain (Ministerio de Empleo y Seguridad Social). The estimated costs to be incurred in the personnel restructuring and other costs directly attributable to the restructuring (equivalent to 13,698 thousand U.S. dollars as of June 30, 2014) were accrued and registered in “Other provisions”.
Given the nature of the risks covered by these provisions, it is not possible to determine a reliable schedule of potential payments, if any.
As of June 30, 2014 lawsuits still before the courts were as follows:
As of June 30, 2014 Atento Brasil was involved in approximately 9,738 labor-related disputes (8,610 in 2013), filed by Atento’s employees or ex-employees for various reasons, such as dismissal or differences over employment conditions in general. The estimated value of these claims was 124,060 thousand U.S. dollars (110,089 thousand U.S. dollars as of December 31, 2013), of which 75,493 thousand U.S. dollars are classified as probable (71,883 thousand U.S. dollars as of December 31, 2013), 42,614 thousand U.S. dollars are classified as possible (34,606 thousand U.S. dollars as of December 31, 2013), and 5,953 thousand U.S. dollars are classified as remote (3,600 thousand U.S. dollars as of December 31, 2013) based on inputs from external and internal counsels as well as historical statistics. In the six months ended June 30, 2014 an additional provision of 6,617 thousand US dollars was made. The Company’s directors and legal advisors consider that these amounts are sufficient to cover the probable risk of an outflow of funds in respect of the disputes.
 
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Moreover, Atento Brasil, S.A. has 24 civil lawsuits ongoing for various reasons (17 in 2013). The total amount of these claims is approximately 903 thousand U.S. dollars (1,061 thousand U.S. dollars at December 31, 2013). According to the Company’s external attorneys, materialization of the risk event is possible.
In addition, as of June 30, 2014 Atento Brasil, S.A. has 27 contentious proceedings ongoing with the tax authorities and social security authorities, for various reasons relating to infraction proceedings filed (33 in 2013). The total amount of these claims is approximately 38,142 thousand U.S. dollars (47,532 thousand U.S. dollars at December 31, 2012). According to the Company’s external attorneys, materialization of the risk event is possible.
Lastly, there are other contingencies which are classified as possible by the Company amounting to 9,194 thousand U.S. dollars (8,535 thousand U.S. dollars as of December 31, 2013).
As of June 30, 2014 Teleatento del Perú, S.A.C. has a lawsuit underway with the Peruvian tax authorities in the amount of 9,332 thousand U.S. dollars (9,473 thousand U.S. dollars as of December 31, 2013). According to the Company’s external attorneys, materialization of the risk event is possible.
As of June 30, 2014 Atento Teleservicios España S.A.U. was party to labor-related disputes filed by Atento employees or former employees for different reasons, such as dismissals and disagreements regarding employment conditions, totaling 3,666 thousand U.S. dollars (2,251 thousand U.S. dollars as of December 31, 2013). According to the Company’s external lawyers, materialization of the risk event is possible.
As of June 30, 2014 Atento México S.A. de CV was party to labor-related disputes filed by Atento employees or former employees for different reasons, such as dismissals and disagreements regarding employment conditions, totaling 6,183 thousand U.S. dollars (4,823 thousand U.S. dollars as of December 31, 2013). According to the Company’s external lawyers, materialization of the risk event is possible.
12. AVERAGE NUMBER OF GROUP EMPLOYEES
The average headcount in the Atento Group in the first six months of 2013 and 2014 and the breakdown by countries are as follows:

 	  	Average headcount	 	
(Unaudited)	  	2013	 	  	2014	 	
Brazil	  	 	85,426	  	  	 	83,289	  	
Central America	  	 	4,154	  	  	 	3,884	  	
Chile	  	 	3,636	  	  	 	4,382	  	
Colombia	  	 	5,168	  	  	 	5,955	  	
Spain	  	 	14,312	  	  	 	12,674	  	
Morocco	  	 	1,786	  	  	 	1,434	  	
Mexico	  	 	17,949	  	  	 	20,330	  	
Peru	  	 	10,222	  	  	 	11,685	  	
Puerto Rico	  	 	789	  	  	 	712	  	
United States	  	 	387	  	  	 	387	  	
Czech Republic	  	 	883	  	  	 	732	  	
Argentina and Uruguay	  	 	9,474	  	  	 	8,177	  	
	  	 	 	 	  	 	 	 	
Total	  	 	154,186	  	  	 	153,641	  	

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13. INCOME TAX
The breakdown of the Atento Group’s income tax expense is as follows:

Income taxes	  	06/30/2013
(Unaudited)	 	 	06/30/2014
(Unaudited)	 	
Current tax expense / (income)	  	 	642	  	 	 	14,174	  	
Deferred tax	  	 	(2,569	) 	 	 	(24,981	) 	
Adjustment to prior years	  	 	(147	) 	 	 	264	  	
	  	 	 	 	 	 	 	 	
Total income tax expense / (income)	  	 	(2,074	) 	 	 	(10,543	) 	
	  	 	 	 	 	 	 	 	
The effective tax rate on the Atento Group’s consolidated earnings in the six months period ended June 30, 2014 was 30.1%. This rate is distorted because of the contribution of losses in the holding companies comprising the Group to Atento’s pre-tax result and the tax effect of the impairment described in Note 7. Stripping out this effects, pre-tax profit would have stood at 35,569 thousand U.S. dollars, with an income tax expense of 12,807 thousand U.S. dollars. Consequently, the aggregate rate excluding the Group’s holding companies is 36 %.
The effective tax rate on the Atento Group’s consolidated earnings in the six months period ended June 30, 2013 was 8.2%. This rate is distorted because of the contribution of losses in the holding companies comprising the Group to Atento’s pre-tax result. Stripping out this effect, pre-tax profit would have stood at 36,612 thousand U.S. dollars, with an income tax expense of 14,144 thousand U.S. dollars. Consequently, the consolidated rate excluding the Group’s holding companies is 38.6%.
14. EARNINGS PER SHARE
Basic earnings per share are calculated by dividing the profits attributable to equity holders of the Company by the weighted average number of ordinary shares outstanding during the periods.

 	  	06/30/2013
(Unaudited)	 	 	06/30/2014
(Unaudited)	 	
Result attributable to equity holders of the Company	  				 				
Net loss for the period (thousands of U.S. dollars)	  	 	(23,113	) 	 	 	(24,311	) 	
Weighted average number of ordinary shares	  	 	2,000,000	  	 	 	2,000,000	  	
	  	 	 	 	 	 	 	 	
Basic results per share (U.S. dollars)	  	 	(11.56	) 	 	 	(12.16	) 	
	  	 	 	 	 	 	 	 	
Diluted earnings per share are calculated by adjusting the weighted average number of ordinary shares outstanding to reflect the hypothetical conversion of all potentially dilutive ordinary shares. The Company has no potentially dilutive ordinary shares, and thus there is no difference between basic earnings per share and diluted earnings per share.
15. RELATED PARTIES
Directors
The directors of the Company at the date on which the financial statements were prepared are Melissa Bethell, Aibhe Jennings, Aurelien Vasseur and Jay Corrigan.
The directors currently serving on the Board of the Company received no remuneration as directors in the six months ended June 30, 2013 and 2014.
 
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Key management personnel
Key management personnel include those persons empowered and responsible for planning, directing and controlling the Atento Group’s activities, either directly or indirectly.
Key management personnel with executive duties in the Atento Group in the six months ended June 30, 2013 and 2014 are as follows:
2013

Name	  	Post	
Alejandro Reynal Ample	  	Chief Executive Officer	
Mª Reyes Cerezo Rodriguez Sedano	  	Chief Legal and Compliance Officer	
Juan Enrique Gamé	  	Regional Director—South America	
Mariano Castaños Zemborain	  	Regional Director—EMEA	
Nelson Armbrust	  	Regional Director—Brazil	
Miguel Matey Marañón	  	Regional Director—North America and Mexico	
José Ignacio Cebollero Bueno	  	Director of Human Resources	
John Robson	  	Director of Global Technology	
Diego López San Román	  	Director of Sales and Business Development	
2014

Name	  	Post	
Alejandro Reynal Ample	  	Chief Executive Officer	
Mª Reyes Cerezo Rodriguez Sedano	  	Chief Legal and Compliance Officer	
Mauricio Montilha Teles	  	Chief Financial Officer	
José Ignacio Cebollero Bueno	  	Director of Human Resources	
Miguel Matey Marañón	  	Regional Director—North America and Mexico	
Juan Enrique Gamé	  	Regional Director—South America	
Nelson Armbrust	  	Regional Director—Brazil	
John Robson	  	Director of Global Technology	
Michael Flodin	  	Atento Operations Director	
Bruce Dawson	  	Near Shore Director	
Mariano Castaños Zemborain	  	Director of Sales	
José María Pérez Melber	  	Regional Director—EMEA	
The following table shows the total remuneration paid to the Atento Group’s key management personnel in the six months ended June 30, 2013 and 2014:

(Unaudited)	  	Thousands of U.S. dollars	 	
	  	    2013    	 	  	    2014    	 	
Total remuneration paid to key management personnel	  	 	5,837	  	  	 	6,086	  	
 
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The breakdown of the remuneration shown above is as follows:

(Unaudited)	  	Thousands of U.S. dollars	 	
	  	    2013    	 	  	    2014    	 	
Salaries and variable remuneration	  	 	5,693	  	  	 	5,775	  	
Salaries	  	 	1,548	  	  	 	2,152	  	
Variable remuneration	  	 	1,348	  	  	 	3,623	  	
Other remuneration related to Management Incentive Program	  	 	2,797	  	  	 	—	  	
Payment in kind	  	 	144	  	  	 	311	  	
Medical insurance	  	 	24	  	  	 	47	  	
Life insurance premiums	  	 	7	  	  	 	9	  	
Other	  	 	113	  	  	 	255	  	
	  	 	 	 	  	 	 	 	
Total	  	 	5,837	  	  	 	6,086	  	
	  	 	 	 	  	 	 	 	
On July 18, 2013, Atento Spain Holdco 2, S.A.U., an indirect subsidiary, entered into a revolving facility agreement with Atalaya Management Luxco Investment pursuant to which Atento Spain Holdco 2, S.A.U. provided a Euro revolving loan facility in an aggregate amount equal to 3 million euros (equivalent to 4.1 million U.S. dollars) to Atalaya Management Luxco Investment for the purpose of acquiring an immaterial ownership interest in a related party. As of December 31, 2013, the management loan had an outstanding balance of 2,423 thousand U.S. dollars which was included in other non-current receivables on the statement of financial position. The loan accrued interest at a rate of 6% per annum, matured on July 18, 2023.
On April 25, 2014, Atento Spain Holdco 2, S.A.U. contributed its receivable for the outstanding amount under the Facility (2,494 thousand euros equivalent to 3,449 U.S. dollars) to Atalaya Management Luxco Investment in exchange for the issuance by Atalaya Management Luxco Investment of a Class 4 Preference Share, fully subscribed by Atento Spain Holdco 2, S.A.U. On May 30, 2014, the Class 4 Preference Share was redeemed for a total consideration of 2,508 thousand euros (equivalent to 3,413 thousand U.S. dollars). The redemption price was fully paid in cash.
Balances and transactions with the Sole Shareholder and other related parties
The Group’s sole shareholder is Atento, S.A. The ultimate parent company of the group is Atalaya Luxco Topco, S.C.A.
The table below sets out balances and transactions with the Sole Shareholder and other related parties (in thousand U.S. dollars).

 	  	12/31/2013
(Audited)	 	  	06/30/2014
(Unaudited)	 	
Non-current payables to Group companies	  	 	519,607	  	  	 	620,705	  	
Atalaya Luxco Topco, S.C.A.	  	 	519,607	  	  	 	—	  	
Atalaya Luxco Pikco, S.C.A.	  	 	—	  	  	 	620,705	  	
As of December 31, 2013 Atalaya Luxco Topco, S.C.A. payables were composed of the following: (i) three series of Preferred Equity Certificates issued by the Company and subscribed by Atalaya Luxco Topco, totaling 517.4 million U.S. dollars as of December 31, 2013; (ii) accrued interests amounting to 2.2 million U.S. dollars as of December 31, 2013.
In May 15, 2014 Atalaya Luxco Topco S.C.A. and Atalaya Luxco Pikco, S.C.A. entered into a subscription agreement. This agreement stated that all of the PECs were entirely paid up by way of a contribution in kind from Atalaya Luxco Topco to Atalaya Luxco Pikco.
 
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In addition, in May 30, 2014 the Company authorized issuance of the following Preferred Equity Certificates (PECs):
 
 	•	 	Series 4: 50,000,000,000 PECs with a par value of 0.01 euro each. These PECs mature after 30 years, but may be withdrawn prior to this date in certain scenarios, and accrued interest of 5%. At June 30, 2014 the Company had issued 6,414,652,564 Series 4 PECs for an aggregate amount of 64,147 thousand euros, equivalent to 87,285 thousand U.S. dollars.	
As of June 30, 2014 Atalaya Luxco Pikco, S.C.A. payables are composed of the following: (i) four series of Preferred Equity Certificates issued by the Company and subscribed by Atalaya Luxco Pikco, totaling 600 million U.S. dollars as of June 30, 2014 and (ii) accrued interests amounting to 20.7 million U.S. dollars as of June 30, 2014.
The interest expense on these debts in the six months ended June 30, 2014 was 18.6 million U.S. dollars (12.4 million U.S. dollars in the six months ended June 30, 2013).
The PECs are classified as subordinated debt with respect to the Company’s other present and future obligations. The table below provides a summary of PECs and their movements in the six months ended June 30, 2014:

Thousands of U.S. Dollars	 	
PEC	  	Maturity	  	12/31/2013
(Audited)	 	  	Issuance	 	  	Interest	 	  	Translation
differences	 	 	06/30/2014
(Unaudited)	 	
Series 1 PECs	  	2042	  	 	353,867	  	  	 	—	  	  	 	14,113	  	  	 	(3,464	) 	 	 	364,516	  	
Series 2 PECs	  	2042	  	 	3	  	  	 	—	  	  	 	4,060	  	  	 	(14	) 	 	 	4,049	  	
Series 3 PECs	  	2072	  	 	165,737	  	  	 	—	  	  	 	—	  	  	 	(1,598	) 	 	 	164,139	  	
Series 4 PECs	  	2044	  	 	—	  	  	 	87,285	  	  	 	391	  	  	 	325	  	 	 	88,001	  	
	  		  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	
Total	  		  	 	519,607	  	  	 	87,285	  	  	 	18,564	  	  	 	(4,751	) 	 	 	620,705	  	
	  		  	 	 	 	  	 	 	 	  	 	 	 	  	 	 	 	 	 	 	 	
Given the specific features and conditions of these instruments and their recent date of issuance, the PECs’s book value approximates to their fair value, which fair value hierarchy is level 3.
For further information regarding the PECs, see Note 26 of our consolidated financial statements for the year ended December 31, 2013.
Transactions with Bain Capital
A number of Group companies receive consultancy services and other services from companies related to Bain Capital Partners LLC. The services are provided under market conditions. Transactions with Bain Capital Partners in the six months ended June 30, 2014 amounted to 4,222 thousand U.S. dollars and principally relate to services provided under the consulting services agreement entered to with the Company (6,938 thousand U.S. dollars in the six months ended June 30, 2013 principally related to transaction fees in connection with the bond issuance and services provided under the consulting services agreement entered to with the Company).
16. OTHER INFORMATION
a. Guarantees and commitments
At June 30, 2014, the Company has guarantees and commitments with third parties amounting to 394,051 thousand U.S. dollars (233,413 thousand U.S. dollars at December 31, 2013).
The company’s directors consider that no contingencies will arise from these guarantees in addition to those already recognized.
 
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The total amount of operating lease expenses recognized in the interim consolidated income statement for the six months ended June 30, 2014 was 56,177 thousand U.S. dollars (62,530 thousand U.S. dollars at June 30, 2013).
There are no contingent payments on operating leases recognized in the interim consolidated income statements for the six months ended June 30, 2014 and 2013.
The operating leases where the Company acts as lessee are mainly on premises intended for use as call centers. These leases have various termination dates, with the latest terminating in 2023. As of June 30, 2014, the payment commitment for the early cancellation of these leases is 161,323 thousand U.S. dollars (147,914 thousand U.S. dollars at December 31, 2013).
17. EVENTS AFTER THE REPORTING PERIOD
The Company has evaluated events through August 4, 2014, which is the date the interim condensed consolidated financial statements were available to be issued, and has determined that there were no additional subsequent events after June 30, 2014 requiring adjustment or disclosure in the interim condensed consolidated financial statements.
 
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Until                     ,             (25 days after the date of this prospectus), all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This delivery requirement is in addition to the dealers’ obligation to deliver a prospectus when acting as an underwriter and with respect to their unsold allotments or subscriptions.

Atento S.A.
14,625,000 Ordinary Shares
PROSPECTUS

Morgan Stanley	 	Credit Suisse	 	Itaú BBA	

BofA Merrill Lynch	 	Bradesco BBI	 	BTG Pactual	 	Goldman, Sachs & Co.	 	Santander	 	Baird	 	BBVA	

 
 
                    , 2014

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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 6. Indemnification of Directors and Officers.
Pursuant to Luxembourg law on agency, agents are entitled to be reimbursed any advances or expenses made or incurred in the course of their duties, except in cases of fault or negligence on their part. Luxembourg law on agency is applicable to the mandate of directors and agents of the Company.
Pursuant to Luxembourg law, a company is generally liable for any violations committed by employees in the performance of their functions except where such violations are not in any way linked to the duties of the employee.
Prior to the completion of this offering, our articles of association will provide that directors and officers, past and present, are entitled to indemnification from us to the fullest extent permitted by Luxembourg law against liability and all expenses reasonably incurred or paid by him in connection with any claim, action, suit or proceeding in which he is involved by virtue of his being or having been a director or officer and against amounts paid or incurred by him in the settlement thereof.
No indemnification will be provided against any liability to us or our shareholders (i) by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties of a director or officer; (ii) with respect to any matter as to which any director or officer shall have been finally adjudicated to have acted in bad faith and not in the interest of the Company; or (iii) in the event of a settlement, unless approved by a court or the board of directors.
Prior to completion of this offering, we will enter into separate indemnification agreements with our directors and executive officers, in addition to indemnification provided for in our articles of association. These agreements, among other things, provide for indemnification of our directors and executive officers to the fullest extent permitted by Luxembourg law for expenses, judgments, fines and settlement amounts incurred by this person in any action or proceeding arising out of this person’s services as a director or executive officer or at our request, subject to certain limitations. We believe that these provisions and agreements are necessary to attract and retain qualified persons as directors and executive officers.
We also agreed to indemnify certain officers of the Company for adverse tax consequences they may suffer pursuant to their employment agreements.
The indemnification rights set forth above shall not be exclusive of any other right which any of our former or current directors and officers may have or hereafter acquire under any statute, provision of our articles of association, agreement, vote of shareholders or disinterested directors or otherwise.
We expect to maintain standard policies of insurance that provide coverage (1) to our directors and officers against loss rising from claims made by reason of breach of duty or other wrongful act and (2) to us with respect to indemnification payments that we may make to such directors and officers.
The proposed form of Underwriting Agreement to be filed as Exhibit 1.1 to this Registration Statement provides for indemnification to our directors and officers by the underwriters against certain liabilities.
Item 7. Recent Sales of Unregistered Securities.
On March 5, 2014, the Issuer issued 31,000 ordinary shares with nominal value of €1.00 per share to Atento Luxco Topco S.C.A.
 
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Item 8. Exhibits and Financial Statement Schedules.
(a) Exhibits
The exhibit index attached hereto is incorporated herein by reference.
(b) Financial Statement Schedules
All schedules are omitted because the required information is not applicable or included in the registrant’s financial statements in the Prospectus part of this registration statement.
Item 9. Undertakings.
The undersigned registrant hereby undertakes to provide to the underwriters at the closing specified in the underwriting agreement, certificates in such denominations and registered in such names as required by the underwriters to permit prompt delivery to each purchaser.
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the provisions referenced in Item 14 of this registration statement or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered hereunder, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
The undersigned registrant hereby undertakes that:
 
 	(1)	 	For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in the form of prospectus filed by the registrant pursuant to Rule 424(b) (1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective; and	
 
 	(2)	 	For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.	
 
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form F-1 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Madrid, Spain on September 12, 2014.
ATENTO S.A.

By:	 	/s/ Alejandro Reynal	
Name:	 	Alejandro Reynal	
Title:	 	Chief Executive Officer	
KNOW ALL MEN BY THESE PRESENTS, that each officer, director and representative of Atento S.A. whose signature appears below constitutes and appoints Alejandro Reynal, Mauricio Montilha and Reyes Cerezo, and each of them, his or her true and lawful attorney-in-fact and agent, with full power of substitution and revocation, for him or her and in his or her name, place and stead, in any and all capacities, to execute any or all amendments including any post-effective amendments and supplements to this Registration Statement, and any additional Registration Statement filed pursuant to Rule 462(b), and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent full power and authority to do and perform each and every act and thing requisite and necessary to be done, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent, or his or her substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated:

Signature	  	Title	 	Date	
			
/s/ Alejandro Reynal
Alejandro Reynal	  	Chief Executive Officer and Director	 	September 12, 2014	
			
/s/ Mauricio Montilha
Mauricio Montilha	  	Chief Financial Officer and principal accounting officer	 	September 12, 2014	
			
/s/ Francisco Tosta Valim Filho
Francisco Tosta Valim Filho	  	Director	 	September 12, 2014	
			
/s/ Melissa Bethell
Melissa Bethell	  	Director	 	September 12, 2014	
			
/s/ Aurelien Vasseur
Aurelien Vasseur	  	Director	 	September 12, 2014	
			
/s/ Mark Nunnelly
Mark Nunnelly	  	Director	 	September 12, 2014	
 
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Signature	  	Title	 	Date	
			
/s/ Luis Javier Castro
Luis Javier Castro	  	Director	 	September 12, 2014	
			
/s/ Stuart Gent
Stuart Gent	  	Director	 	September 12, 2014	
			
/s/ Devin O’Reilly
Devin O’Reilly	  	Director	 	September 12, 2014	
			
/s/ Jay Corrigan
Jay Corrigan	  	Authorized Representative in the United States of America	 	September 12, 2014	
 
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EXHIBIT INDEX

Exhibit
Number	 	Description	
  1.1	 	Form of Underwriting Agreement.	
  2.1†	 	Sale and Purchase Agreement, dated as of October 11, 2012, by and between Telefónica S.A. and the Buyers named therein.	
  2.2†	 	Amendment Agreement, dated as of December 12, 2012, by and between Telefónica, S.A. and the Buyers named therein.	
  3.1†	 	Articles of Association of Atento S.A., as currently in effect.	
  3.2	 	Form of Amended and Restated Articles of Association of Atento S.A. to be effective upon completion of this offering.	
  4.1†	 	Indenture, dated as of January 29, 2013, by and among BC Luxco 1 S.A., the guarantors party thereto, Citibank, N.A., London Branch as Trustee and Principal Paying Agent, Citibank Global Markets Deutschland AG, as Registrar and Citibank, N.A., London Branch, as collateral agent.	
  4.2†	 	Form of Senior Secured Note (included in Exhibit 4.2 hereto).	
  5.1	 	Opinion of Arendt & Medernach.	
10.1†	 	Transaction Services Agreement between Spain Holdco and Bain Capital Partners, LLC, dated December 12, 2012.	
10.2†	 	Consulting Services Agreement between Portfolio Company Advisors, Ltd and Bain Capital Partners, LLC, dated December 12, 2012.	
10.3†	 	Management Services Agreement between Spain Holdco, Mexico Holdco, Spain Holdco 2, Spain Holdco 5 and Spain Holdco 6, dated December 12, 2012.	
10.4†	 	Subscription and Securityholder’s Agreement, dated as of December 4, 2012, by and among BC Luxco Topco, BC Luxco and each of the investors party thereto.	
10.5†	 	Subscription and Securityholder’s Agreement, dated as of December 4, 2012, by and among BC Luxco Topco, BC Luxco and each of the investors party thereto.	
10.6**†	 	Master Services Agreement between BC Luxco 1 and Telefónica S.A., dated as of December 11, 2012, as amended by Amendment Agreement No. 1 thereto dated as of May 16, 2014.	
10.7†	 	Vendor Loan Agreement, dated as of December 12, 2012, between Global Laurentia, S.L.U. and the lenders party thereto.	
10.8†	 	Super Senior Revolving Credit Facilities Agreement, dated as of January 28, 2013, among BC Luxco 1 S.A., the entities and guarantors named therein and the arrangers and lenders party thereto.	
10.9†	 	Instrumento Particular de Escritura (Brazilian debentures).	
10.10+	 	2014 Omnibus Incentive Plan.	
10.11+	 	Form of Performance Restricted Stock Unit Agreement.	
10.12+	 	Form of Time Restricted Stock Unit Agreement.	
10.13	 	Form of Registration Rights Agreement.	
10.14	 	Form of Consulting Services and Information Rights Agreement.	
10.15	 	Form of Directors and Officers Indemnification Agreement.	
21.1	 	List of subsidiaries of Atento S.A.	
23.1	 	Consent of Ernst & Young, S.L., independent registered public accounting firm.	
23.2	 	Consent of Arendt & Medernach (included in Exhibit 5.1).	
24.1	 	Powers of Attorney (included in the signature pages hereto).	

**	Application has been made to the Securities and Exchange Commission for confidential treatment of certain provisions of this exhibit. Omitted material for which confidential treatment has been requested has been filed separately with the Securities and Exchange Commission.	
+	Indicates a management contract or compensatory plan or arrangement.	
†	Previously filed.	
 
II-5

Exhibit 1.1
[        ] Shares
ATENTO S.A.
ORDINARY SHARES (NO NOMINAL VALUE PER ORDINARY SHARE)
UNDERWRITING AGREEMENT
[            ], 2014

[            ], 2014
Morgan Stanley & Co. LLC
1585 Broadway
New York, New York 10036
Credit Suisse Securities (USA) LLC
Eleven Madison Avenue
New York, New York 10010-3629
Itaú BBA USA Securities, Inc.
767 Fifth Avenue, 50 th Floor
New York, New York 10153
As Representatives (“ you ” or the “ Representatives ”) of the several Underwriters
Ladies and Gentlemen:
ATENTO S.A., a corporation ( société anonyme ) incorporated and existing under the laws of the Grand Duchy of Luxembourg (the “ Company ”), proposes to issue and sell to the several Underwriters named in Schedule II hereto (the “ Underwriters ”), and the shareholder of the Company (the “ Selling Shareholder ”) named in Schedule I hereto proposes to sell to the several Underwriters, an aggregate of [        ] ordinary shares (no nominal value per ordinary share) of the Company (the “ Firm Shares ”), of which [        ] shares are to be issued and sold by the Company and subscribed for by the Underwriters and [        ] shares are to be sold by the Selling Shareholder.
The Selling Shareholder also proposes to sell, to the several Underwriters not more than an additional [        ] ordinary shares (no nominal value per ordinary share) (the “ Additional Shares ”) if and to the extent that you, as Representatives, shall have determined to exercise, on behalf of the Underwriters, the right to purchase such ordinary shares granted to the Underwriters in Section 3 hereof. The Firm Shares and the Additional Shares are hereinafter collectively referred to as the “ Shares ”. The ordinary shares of the Company to be issued and outstanding after giving effect to the issuance and sales contemplated hereby are hereinafter referred to as the “ Common Stock ”. The Company and the Selling Shareholder are hereinafter sometimes collectively referred to as the “ Sellers ”.
The Company has filed with the Securities and Exchange Commission (the “ Commission ”) a registration statement, including a prospectus, relating to the Shares. The registration statement as amended at the time it becomes effective, including the information (if any) deemed to be part of the registration statement at the time of

effectiveness pursuant to Rule 430A under the U.S. Securities Act of 1933, as amended (the “ Securities Act ”), is hereinafter referred to as the “ Registration Statement ”; the prospectus in the form first used to confirm sales of Shares (or in the form first made available to the Underwriters by the Company to meet requests of purchasers pursuant to Rule 173 under the Securities Act) is hereinafter referred to as the “ Prospectus .” If the Company has filed an abbreviated registration statement to register additional shares of Common Stock pursuant to Rule 462(b) under the Securities Act (the “ Rule 462 Registration Statement ”), then any reference herein to the term “ Registration Statement ” shall be deemed to include such Rule 462 Registration Statement.
For purposes of this Agreement, “ free writing prospectus ” has the meaning set forth in Rule 405 under the Securities Act, “ Time of Sale Prospectus ” means the preliminary prospectus (the “ Preliminary Prospectus ”) together with the documents and pricing information set forth in Schedule III hereto, and “ broadly available road show ” means a “bona fide electronic road show” as defined in Rule 433(h)(5) under the Securities Act that has been made available without restriction to any person. As used herein, the terms “Registration Statement,” “preliminary prospectus,” “Time of Sale Prospectus” and “Prospectus” shall include the documents, if any, incorporated by reference therein as of the date hereof.
1. Representations and Warranties of the Company . The Company represents and warrants to and agrees with each of the Underwriters that:
(a) The Registration Statement has become effective; no stop order suspending the effectiveness of the Registration Statement is in effect, and no proceedings for such purpose are pending before or, to the Company’s knowledge, threatened by the Commission.
(b) (i) The Registration Statement, when it became effective, did not contain and, as amended or supplemented, if applicable, will not, as of the date of such amendment or supplement, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) the Registration Statement and the Prospectus comply and, as amended or supplemented, if applicable, will, as of the date of such amendment or supplement, comply in all material respects with the Securities Act and the applicable rules and regulations of the Commission thereunder, (iii) the Time of Sale Prospectus does not, and at the time of each sale of the Shares in connection with the offering when the Prospectus is not yet available to prospective purchasers and at the Closing Date (as defined in Section 5), the Time of Sale Prospectus, as then amended or supplemented by the Company, if applicable, will not, contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, (iv) each broadly available road show, if any, when considered together with the Time of Sale Prospectus, does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading and (v) the
 
2

Prospectus does not contain and, as amended or supplemented, if applicable, will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, except that the representations and warranties set forth in this paragraph do not apply to statements or omissions in the Registration Statement, the Time of Sale Prospectus or the Prospectus based upon information relating to any Underwriter furnished to the Company in writing by such Underwriter through you expressly for use therein; it being understood and agreed that the only such information furnished by any Underwriter consists of the following information in the Prospectus furnished in writing on behalf of such Underwriter: (i) paragraphs three, seven, fifteen, the first sentence of paragraph seventeen, and paragraph eighteen under the heading “Underwriting”; (ii) only with respect to Banco BTG Pactual S.A.-Cayman Branch, paragraph eight under the heading “Underwriting”; and (iii) only with respect to Banco Bradesco BBI S.A., paragraph nine under the heading “Underwriting”.
(c) The Company is not an “ineligible issuer” in connection with the offering pursuant to Rules 164, 405 and 433 under the Securities Act. Any free writing prospectus that the Company is required to file pursuant to Rule 433(d) under the Securities Act has been, or will be, filed with the Commission in accordance with the requirements of the Securities Act and the applicable rules and regulations of the Commission thereunder. Each free writing prospectus that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act or that was prepared by or behalf of or used or referred to by the Company complies or will comply in all material respects with the requirements of the Securities Act and the applicable rules and regulations of the Commission thereunder. Except for the free writing prospectuses, if any, identified in Schedule III hereto, and electronic road shows, if any, each furnished to you before first use, the Company has not prepared, used or referred to, and will not, without your prior consent, prepare, use or refer to, any free writing prospectus.
(d) The Company has been duly incorporated and is validly existing as a company under the laws of the jurisdiction of its incorporation, has the corporate power and authority to own its property and to conduct its business as described in the Time of Sale Prospectus and is duly qualified to transact business in each jurisdiction in which the conduct of its business or its ownership or leasing of property requires such qualification, except to the extent that the failure to be so qualified would not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the condition (financial or otherwise), results of operations, business, properties or prospects of the Company and its subsidiaries taken as a whole or on the performance by the Company of its obligations under this Agreement (“ Material Adverse Effect ”).
(e) Each subsidiary of the Company has been duly incorporated, is validly existing as a company in good standing (to the extent such concept exists in the jurisdiction) under the laws of the jurisdiction of its incorporation, has the corporate power and authority to own or lease its property and to conduct its
 
3

business as described in the Time of Sale Prospectus and is duly qualified to transact business and is in good standing in each jurisdiction in which the conduct of its business or its ownership or leasing of property requires such qualification, except to the extent that the failure to be so qualified or be in good standing would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; except as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus under the caption “Description of Certain Indebtedness” and as described in the items included in the Exhibit Index to the Registration Statement, all of the issued shares of each subsidiary of the Company have been duly and validly authorized and issued, are fully paid and non-assessable and are owned directly by the Company, free and clear of all liens, encumbrances, equities or claims except to the extent that such liens, encumbrances, equities or claims would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(f) This Agreement has been duly authorized, executed and delivered by the Company.
(g) The authorized share capital of the Company conforms in all material respects as to legal matters to the description thereof contained in each of the Time of Sale Prospectus and the Prospectus.
(h) The shares of Common Stock (including the Shares to be sold by the Selling Shareholder) outstanding prior to the issuance of the Shares to be sold by the Company have been duly authorized and are validly issued fully paid and non-assessable; and there are no outstanding rights (including, without limitation, pre-emptive rights), warrants or options to acquire, or instruments convertible into or exchangeable for, any shares or other equity interest in the Company or any of its subsidiaries, or any contract, commitment, agreement, understanding or arrangement of any kind relating to the issuance of any share of the Company or any such subsidiary, any such convertible or exchangeable securities or any such rights, warrants or options, other than such shares reserved for issuance under the Company’s equity incentive plan described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus under the caption “Management—2014 Omnibus Incentive Plan”.
(i) The Shares to be issued and sold by the Company have been duly authorized and, when issued and delivered in accordance with the terms of this Agreement, will be validly issued, fully paid and non-assessable, and the issuance of such Shares will not be subject to any preemptive or similar rights that have not been duly waived.
(j) The Company has not taken any action which is designed to or which has constituted or which would reasonably be expected to cause or result in stabilization or manipulation of the price of any security of the Company in connection with the offering of the Shares.
 
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(k) The execution and delivery by the Company of, and the performance by the Company of its obligations under, this Agreement will not violate or conflict with (i) the articles of association of the Company, (ii) any agreement or other instrument binding upon the Company or any of its subsidiaries , or (iii) any applicable law or regulation or judgment, order or decree of any governmental body, agency or court having jurisdiction over the Company or any subsidiary, except in the case of clause (ii) and (iii) where such contravention would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, and no consent, approval, authorization or order of, or filing, registration or qualification with, any governmental body or agency is required for the offering, issuance and sale of the Shares and the performance by the Company of its obligations under this Agreement, except such as may be required by the securities or Blue Sky laws of the various jurisdictions in connection with the offer and sale of the Shares by the Underwriters and the registration of the shares under the Securities Act and such consents, approvals, authorization, order and registration or qualification as may be required by the Financial Industry Regulatory Authority, Inc. (“ FINRA ”) and except where such contravention or the failure to obtain such consents, approvals, authorizations, orders, registrations, filings or qualifications would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(l) There has not occurred any change or any development which has had or would reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect from that set forth in the Time of Sale Prospectus.
(m) There are no legal or governmental proceedings pending or, to the Company’s knowledge, threatened to which the Company or any of its subsidiaries is a party or to which any of the properties of the Company or any of its subsidiaries is subject (i) other than proceedings accurately described in all material respects in the Time of Sale Prospectus under the heading “Business-Legal Proceedings” and proceedings that would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect, or (ii) that are required to be described in the Registration Statement or the Prospectus and are not so described; and there are no statutes, regulations, contracts or other documents that are required to be described in the Registration Statement or the Prospectus or to be filed as exhibits to the Registration Statement that are not described or filed as required.
(n) Each preliminary prospectus filed as part of the Registration Statement as originally filed or as part of any amendment thereto, or filed pursuant to Rule 424 under the Securities Act, complied when so filed in all material respects with the Securities Act and the applicable rules and regulations of the Commission thereunder.
(o) The Company is not, and after giving effect to the offering and sale of the Shares and the application of the proceeds thereof as described in the Prospectus will not be, required to register as an “investment company” as such term is defined in the Investment Company Act of 1940, as amended.
 
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(p) The Company and its subsidiaries (i) are in compliance with any and all applicable foreign, federal, state and local laws and regulations relating to the protection of human health and safety, the environment or hazardous or toxic substances or wastes, pollutants or contaminants ( “ Environmental Laws ” ), (ii) have received all permits, licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses, (iii) have not received notice of any actual or potential liability under or relating to any Environmental Laws, including for the investigation or remediation of any disposal or release of hazardous or toxic substances or wastes, pollutants or contaminants, and have no knowledge of any event or condition that would reasonably be expected to result in any such notice, and (iv) are in compliance with all terms and conditions of any such permit, license or approval, except where such noncompliance with Environmental Laws, failure to receive required permits, licenses or other approvals or failure to comply with the terms and conditions of such permits, licenses or approvals would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(q) There are no costs or liabilities associated with Environmental Laws (including, without limitation, any capital or operating expenditures required for clean-up, closure of properties or compliance with Environmental Laws or any permit, license or approval, any related constraints on operating activities and any potential liabilities to third parties) which would, individually or in the aggregate, reasonably be likely to have a Material Adverse Effect; none of the Company and its subsidiaries anticipates material capital expenditures relating to any Environmental Laws; and there are no proceedings that are pending, or to the Company’s knowledge contemplated, against the Company or any of its subsidiaries under any Environmental Laws in which a governmental entity is also a party.
(r) There are no contracts, agreements or understandings between the Company and any person granting such person the right to require the Company to file a registration statement under the Securities Act with respect to any securities of the Company or to require the Company to include such securities with the Shares registered pursuant to the Registration Statement.
(s) There are no contracts, agreements or understandings between the Company and any person (other than this Agreement) that would give rise to a valid claim against the Company or any Underwriter for a brokerage commission, finder’s fee or other like payment in connection with this offering.
(t) Except as disclosed in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus under the captions “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources”, “Description of Certain Indebtedness” and the
 
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items included in the Exhibit Index to the Registration Statement, no subsidiary of the Company is currently prohibited, directly or indirectly, under any agreement or other instrument to which it is a party or is subject, from paying any dividends to the Company, from making any other distribution on such subsidiary’s capital share, from repaying to the Company any loans or advances to such subsidiary from the Company or from transferring any of such subsidiary’s properties or assets to the Company or any other subsidiary of the Company, except where such prohibition would not, individually or in the aggregate, have a Material Adverse Effect.
(u) The Shares have been approved for listing on the New York Stock Exchange, subject to notice of issuance.
(v) Neither the Company nor any of its subsidiaries or controlled affiliates, nor any director, officer, or employee, nor, to the Company’s knowledge, any employee, agent or representative of the Company or of any of its subsidiaries or affiliates, (i) has taken any action in furtherance of an offer, payment, promise to pay, or authorization or approval of the payment or giving of money, property, rebates, gifts, entertainment expense or anything else of value, directly or indirectly, to any “government official” (including any officer or employee of a government or government-owned or controlled entity or of a public international organization, or any person acting in an official capacity for or on behalf of any of the foregoing, or any political party or party official or candidate for political office) to unlawfully influence official action or secure an improper advantage, or (ii) has made any payment or taken any action from any funds of the Company or any of its subsidiaries which violated or would result in a violation of any applicable provision of any anti-corruption law (including, but not limited to, the U.S. Foreign Corrupt Practices Act of 1977, as amended (the “ FCPA ” ), to the extent applicable); and the Company and its subsidiaries and, to the knowledge of the Company, its affiliates, have conducted their businesses in compliance with applicable anti-corruption laws and have instituted and maintain and will continue to maintain policies and procedures designed to promote and achieve compliance with such laws and with the representation and warranty contained herein.
(w) No relationship, direct or indirect, exists between or among the Company or any of its subsidiaries, on the one hand, and the directors, officers, shareholders, customers or suppliers of the Company or any of its subsidiaries, on the other, that is required by the Securities Act to be described in the Registration Statement and the Prospectus and that is not so described in such documents and in the Time of Sale Prospectus.
(x) The operations of the Company and its subsidiaries are and have been conducted at all times in material compliance with all applicable financial recordkeeping and reporting requirements, including those of the FCPA, the Bank Secrecy Act, as amended by Title III of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act
 
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of 2001 (USA PATRIOT Act), to the extent applicable, and the applicable anti-money laundering statutes of the Grand Duchy of Luxembourg (“ Luxembourg ”), Brazil, Spain, Mexico, Argentina and all other jurisdictions where the Company and its subsidiaries conduct business, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “ Anti-Money Laundering Laws ”), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to the Anti-Money Laundering Laws is pending or, to the knowledge of the Company, threatened.
(y) Neither the Company nor any of its subsidiaries, nor any director, officer, or employee thereof, nor, to the Company’s knowledge, any agent, affiliate or representative of the Company or any of its subsidiaries, is an individual or entity (“ Person ”) that is, or is owned or controlled by a Person that is:
(A) the subject of any sanctions administered or enforced by the U.S. Department of Treasury’s Office of Foreign Assets Control (“ OFAC ”), the United Nations Security Council (“ UNSC ”), the European Union (“ EU ”) or Her Majesty’s Treasury (“ HMT ”) (collectively, “ Sanctions ”), nor
(B) located, organized or resident in a country or territory that is the subject of Sanctions (including, without limitation, Cuba, Iran, North Korea, Sudan and Syria).
(z) (i) The Company will not, directly or indirectly, use the proceeds of the offering, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other Person:
(A) to fund or facilitate any activities or business of or with any Person or of any other entity or person in any country or territory that, at the time of such funding or facilitation, is the subject of Sanctions; or
(B) in any other manner that will result in a violation of Sanctions by any Person (including any Person participating in the offering, whether as underwriter, advisor, investor or otherwise).
(ii) For the past [        ]] 1 , the Company and its subsidiaries have not knowingly engaged in, are not now knowingly engaged in, and will not engage in, any dealings or transactions with any Person, or in any country or territory, that at the time of the dealing or transaction is or was the subject of Sanctions.

1  	NTD: To be completed with the number of months elapsed between the date of the acquisition and the date of this Agreement.	
 
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(aa) Since the date of the audited financial statements included in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, (i) the Company and its subsidiaries have not incurred any material liability or obligation, direct or contingent, nor entered into any material transaction; (ii) the Company has not purchased any of its outstanding share capital, nor declared, paid or otherwise made any dividend or distribution of any kind on its share capital other than ordinary and customary dividends; and (iii) there has not been any material change in the share capital, short-term debt or long-term debt of the Company and its subsidiaries, except in each case as described in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, respectively.
(bb) The Company and its subsidiaries have good and marketable title to all real property and good and marketable title to all personal property owned by them which is material to the business of the Company and its subsidiaries, in each case free and clear of all liens, encumbrances and defects except such as are described in the of the Registration Statement, the Time of Sale Prospectus and the Prospectus or such as do not materially affect the value of such property and do not interfere with the use made and proposed to be made of such property by the Company and its subsidiaries; and any real property and buildings held under lease by the Company and its subsidiaries are held by them under valid, subsisting and enforceable leases with such exceptions as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(cc) The Company and its subsidiaries own or possess, or can acquire on reasonable terms, all material patents, patent rights, licenses, inventions, copyrights, know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures), trademarks, service marks and trade names (collectively, the “ I ntellectual Property ”) currently employed by them in connection with the business now operated by them, and neither the Company nor any of its subsidiaries has received any notice of infringement of or conflict with asserted rights of others with respect to the Intellectual Property which, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect, and to the knowledge of the Company, the Intellectual Property of the Company and its subsidiaries is not being infringed, misappropriated or otherwise violated by any person.
(dd) Except as disclosed in each of the Registration Statement, the Time of Sale Prospectus and the Prospectus, no material labor dispute with the employees of the Company or any of its subsidiaries exists or, to the knowledge of the Company, is imminent.
(ee) The Company and each of its subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are prudent and customary in the businesses in which they are engaged; neither the Company nor any of its subsidiaries has any reason to
 
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believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(ff) The Company and its subsidiaries possess all licenses, sub-licenses, certificates, authorizations and permits issued by, and have made all declarations and filings with, the appropriate federal, state or foreign regulatory authorities necessary to conduct their respective businesses, except where the failure to possess such certificates, authorizations and permits would not reasonably be likely to have, individually or in the aggregate, a Material Adverse Effect, and neither the Company nor any of its subsidiaries has received any notice of proceedings relating to the revocation or modification of any such certificate, authorization or permit which, individually or in the aggregate, would reasonably be likely to have a Material Adverse Effect.
(gg) The Company and each of its subsidiaries maintain a system of internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. Since the end of the Company’s most recent audited fiscal year, there has been (i) no material weakness in the Company’s internal control over financial reporting (whether or not remediated) and (ii) no change in the Company’s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
(hh) The Company has not sold, issued or distributed any shares of Common Stock during the six-month period preceding the date hereof, including any sales pursuant to Rule 144A under, or Regulation D or S of, the Securities Act, other than the share capital of the Company issued in connection with the formation of the Company on March 5, 2014 and two ordinary shares issued to the Selling Shareholder in connection with the Reorganization Transaction (as defined in the Prospectus).
(ii) The Company and each of its subsidiaries have filed all federal, state, local and foreign tax returns in all applicable jurisdictions required to be filed through the date of this Agreement or have requested extensions thereof (except where the failure to file would not, individually or in the aggregate, have a Material Adverse Effect) and have paid all taxes required to be paid thereon (except for cases in which the failure to file or pay would not, individually or in the aggregate, reasonably be likely to have a Material Adverse Effect, or, except
 
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as currently being contested in good faith and for which reserves required by International Financial Reporting Standards as issued by the International Accounting Standards Board (“ IFRS ”) have been created in the financial statements of the Company), and no tax deficiency has been determined adversely to the Company or any of its subsidiaries which has had (nor does the Company nor any of its subsidiaries have any notice or knowledge of any tax deficiency which could reasonably be expected to be determined adversely to the Company or its subsidiaries and which could reasonably be expected to have) a Material Adverse Effect.
(jj) There is no tax, duty, levy, impost, deduction, charge or withholding imposed by Luxembourg or any political subdivision thereof or taxing authority therein , including interest and penalties, payable by or on behalf of the Underwriters either (a) on or by virtue of the Underwriters’ execution, delivery, performance or enforcement of this Agreement, or (b) on any payment to be made pursuant to this Agreement, except for (i) income taxes payable by the Underwriters relating to fees and commissions they will receive in connection with the transactions contemplated in this Agreement, (ii) a withholding or deduction if such withholding or deduction is required in respect of the Luxembourg laws of 21 June 2005 implementing the Council Directive 2003/48/1EC of 3 June 2003 on taxation of savings income in the form of interest payments (or any amendment thereof) and ratifying the treaties entered into by Luxembourg and certain dependent and associated territories of EU Member States or the Luxembourg law of 23 December 2005 (as amended) introducing in Luxembourg a 10% withholding tax as regards Luxembourg resident individuals, and (iii) a registration duty or any other similar tax in case of a voluntary registration or if the registration of this Agreement (and/or any document in connection therewith) with the Administration de l’Enregistrement et des Domaines in Luxembourg is required in the case of legal proceeding before Luxembourg courts (if competent) or in the case that this Agreement (and/or any document in connection therewith) must be produced before an official Luxembourg authority, in which case either a nominal registration duty or an ad valorem duty (of, for instance 0.24 (zero point twenty-four) percent of the amount of the payment obligation mentioned in the document so registered) will be payable depending on the nature of the document to be registered.
(kk) Any third-party statistical and market related data included in a Registration Statement, the Time of Sale Prospectus or the Prospectus are based on or derived from sources that the Company believes to be reliable and accurate in all material respects. No forward-looking statement (within the meaning of Section 27A of the Act and Section 21E of the Exchange Act) contained in a Registration Statement, the Time of Sale Prospectus or the Prospectus has been made or reaffirmed without a reasonable basis or has been disclosed other than in good faith.
(ll) Ernst & Young, S.L, who have audited the consolidated financial statements of the Company included in the Time of Sale Prospectus, are an
 
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independent registered public accounting firm with respect to the Company and its subsidiaries within the applicable rules and regulations adopted by the Commission and the Public Company Accounting Oversight Board and as required by the Securities Act.
(mm) The financial statements (together with the notes thereto) included in each Registration Statement, the Time of Sale Prospectus and the Prospectus present fairly in all material respects the financial position of the Company and its consolidated subsidiaries as of the dates shown and their results of operations and cash flows for the periods shown, and, such financial statements have been prepared in conformity with IFRS applied on a consistent basis and the schedules included in each Registration Statement present fairly the information required to be stated therein in all material respects.
(nn) The Company was not a “passive foreign investment company” (“ PFIC ”) as defined in Section 1297 of the Internal Revenue Code of 1986, as amended, and the rules and regulations promulgated thereunder, for its most recently completed taxable year and, based on the Company’s current projected income, assets and activities, the Company does not expect to be classified as a PFIC for any subsequent taxable year.
(oo) Under current laws and regulations of Luxembourg and any political subdivision thereof, all dividends and other distributions declared and payable on the Shares may be declared by the Company in Euros and paid by the Company to the holder thereof in U.S. dollars or Euros and freely transferred out of Luxembourg (subject to any restrictions resulting from national or supra national sanctions or prohibitions applicable to certain jurisdictions) and all such payments made to holders thereof or therein who are non-residents of Luxembourg will not be subject to income, withholding or other taxes under laws and regulations of Luxembourg or any political subdivision or taxing authority thereof or therein and will otherwise be free and clear of any other tax, duty, withholding or deduction in Luxembourg or any political subdivision or taxing authority thereof or therein and without the necessity of obtaining any governmental authorization in Luxembourg or any political subdivision or taxing authority thereof or therein, except (i) that distributions imputed for tax purposes on newly accumulated profits are subject to a withholding tax of 15% (unless exemptions apply under Luxembourg law or double taxation treaties), (ii) if a withholding or deduction is required in respect of the Luxembourg laws of 21 June 2005 implementing the Council Directive 2003/48/1EC of 3 June 2003 on taxation of savings income in the form of interest payments (or any amendment thereof) and ratifying the treaties entered into by Luxembourg and certain dependent and associated territories of EU Member States and (iii) distributions derived from a reduction of share capital as defined in Article 97(3) of the Luxembourg income tax law including amongst other, share premium would be subject to a withholding tax of 15% up to the amount of the reserves or the profits carried forward recognizable for tax purposes by the Company on a standalone basis (unless exemptions apply under Luxembourg law or double taxation treaties).
 
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(pp) Neither the Company nor any of its subsidiaries, nor any of their respective subsidiaries, the Company’s and its subsidiaries’ revenues, properties or assets, have any immunity from the jurisdiction of any court or from any legal process (whether through service or notice, attachment prior to judgment, attachment in aid of execution or otherwise) under the laws or from jurisdiction of any court of (i) any jurisdiction in which it owns or leases property or assets, (ii) the United States of America or the State of New York or (iii) Luxembourg and Brazil. If the Company or any subsidiary or any of their respective revenues, properties or assets may have or hereafter acquire immunity from any such law or court, the Company has, pursuant to Section 19 hereof, waived and it will waive, or will cause its subsidiaries to waive, such immunity to the full extent permitted by law.
(qq) This Agreement is in proper legal form under the laws of Luxembourg for the enforcement thereof in Luxembourg against the Company, and to ensure the legality, validity, enforceability or admissibility into evidence in a legal or administrative proceeding in Luxembourg of this Agreement, it is not necessary that this Agreement or any other document related hereto be filed or recorded with any court or other authority in Luxembourg or that any registration tax, stamp duty or similar tax be paid in Luxembourg on or in respect of this Agreement or any other document other than court costs, including (without limitation) filing fees and deposits to guarantee judgment required by a Luxembourg court of law and except as may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, liquidation, moratorium or other similar laws relating to or affecting the rights and remedies of creditors generally; except that, in the case of (1) court proceedings in a Luxembourg court or (2) the presentation of this Agreement or any other document related hereto (either directly or by way of reference) to an autorité constituée , such court or autorité constituée may require registration of all or part of this Agreement or any other document with the Administration de l’Enregistrement et des Domaines in Luxembourg , which may result in registration duties becoming due and payable, at a fixed rate of EUR 12 or an ad valorem rate which depends on the nature of the registered document.
(rr) Any final and conclusive judgment obtained in a U.S. federal or state court of competent jurisdiction sitting in New York City in a civil or commercial suit arising out of or in relation to the obligations of the Company under this Agreement or the transactions contemplated hereby will be enforceable against the Company and will be recognized in Luxembourg, subject to applicable exequatur proceedings, and provided that in particular proof of the following conditions provided by Luxembourg law for enforcement of foreign court judgments may have to be given: (i) the judgment is duly enforceable in New York; (ii) the New York Court had jurisdiction over the subject matter of the action leading to the judgment; (iii) the New York Court has acted in accordance
 
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with its own procedural laws; (iv) the judgment was granted following proceedings where the counterparty had the opportunity to appear, and if it appeared, to present a defense; (v) the New York Court applied the substantive laws chosen by the parties to govern this Agreement; and (vi) the judgment is not contrary to the public order of Luxembourg.
(ss) The choice of laws of the State of New York as the governing law of this Agreement is a valid choice of law under the laws of Luxembourg and will be recognized by the courts of Luxembourg, except that a Luxembourg court may refuse to apply the law of another jurisdiction if it is deemed to be contrary to Luxembourg public order and/or in certain circumstances Luxembourg mandatory law. The submission by the Company to the non-exclusive jurisdiction of the U.S. federal or state courts sitting in The City of New York and County of New York in this Agreement constitutes a valid and legally binding obligation of the Company. Service of process in respect of a claim or action in a U.S. court pursuant to this Agreement, effected in the manner set forth in this Agreement, assuming validity under the laws of the State of New York, will be effective, insofar as Luxembourg law is concerned, to confer valid personal jurisdiction over the Company. The Company has the power to designate, appoint and empower and pursuant to Section 18 of this Agreement has validly and effectively designated, appointed and empowered an agent for service of process in any suit or proceeding based on or arising from this Agreement in any U.S. federal or state court sitting in New York City.
2. Representations and Warranties of the Selling Shareholder . The Selling Shareholder represents and warrants to and agrees with each of the Underwriters that:
(a) This Agreement has been duly authorized, executed and delivered by or on behalf of the Selling Shareholder.
(b) The execution and delivery by the Selling Shareholder of, and the performance by the Selling Shareholder of its obligations under, this Agreement, will not contravene any provision of applicable law, or the certificate of incorporation or by-laws or equivalent organizational document of the Selling Shareholder, or any agreement or other instrument binding upon the Selling Shareholder or any judgment, order or decree of any governmental body, agency or court having jurisdiction over the Selling Shareholder except for such contraventions as would not, individually or in the aggregate, reasonably, be expected to have a material adverse effect on the ability of the Selling Shareholder to perform its obligations under this Agreement, and no consent, approval, authorization or order of, or qualification with, any governmental body or agency is required for the performance by the Selling Shareholder of its obligations under this Agreement, except such as have been obtained and made under the Securities Act and such as may be required under the Exchange Act or the rules and the regulations thereunder by the securities or Blue Sky laws of the various state or foreign jurisdictions in connection with the offer and sale of the Shares.
 
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(c) The Selling Shareholder has, and on the Closing Date will have, full right, power and authority to enter into this Agreement and to sell, assign, transfer and deliver the Shares to be delivered by the Selling Shareholder on such Closing Date hereunder or a valid security entitlement (within the meaning of Section 8-501 of the New York Uniform Commercial Code) in respect of such Shares, free and clear of all security interests, claims, liens, equities or other encumbrances.
(d) Upon payment for the Shares to be sold by the Selling Shareholder pursuant to this Agreement, delivery of such Shares, as directed by the Underwriters, to Cede & Co. (“ Cede ”) or such other nominee as may be designated by the Depository Trust Company (“ DTC ”), registration of such Shares in the name of Cede or such other nominee and the crediting of such Shares on the books of DTC to securities accounts of the Underwriters (assuming that neither DTC nor any such Underwriter has notice of any adverse claim (within the meaning of Section 8-105 of the New York Uniform Commercial Code (the “ UCC ”)) to such Shares), (A) DTC shall be a “protected purchaser” of such Shares within the meaning of Section 8-303 of the UCC, (B) under Section 8-501 of the UCC, the Underwriters will acquire a valid security entitlement in respect of such Shares and (C) no action based on any “adverse claim”, within the meaning of Section 8-102 of the UCC, to such Shares may be asserted against the Underwriters with respect to such security entitlement; for purposes of this representation, the Selling Shareholder may assume that when such payment, delivery and crediting occur, (x) such Shares will have been registered in the name of Cede or another nominee designated by DTC, in each case on the Company’s share registry in accordance with its articles of association and applicable law, (y) DTC will be registered as a “clearing corporation” within the meaning of Section 8-102 of the UCC and (z) appropriate entries to the accounts of the several Underwriters on the records of DTC will have been made pursuant to the UCC.
(e) (i) The Registration Statement, when it became effective, did not contain and, as amended or supplemented, if applicable, will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) the Time of Sale Prospectus does not, and at the time of each sale of the Shares in connection with the offering when the Prospectus is not yet available to prospective purchasers and at the Closing Date (as defined in Section 5), the Time of Sale Prospectus, as then amended or supplemented by the Company, if applicable, will not, contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, (iii) each broadly available road show, if any, when considered together with the Time of Sale Prospectus, does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading and (iv) the Prospectus does not contain and, as amended or supplemented, if applicable, will
 
15

not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, provided that the representations and warranties set forth in this paragraph 2(f) are limited to statements or omissions made in reliance upon information relating to the Selling Shareholder furnished to the Company in writing by the Selling Shareholder; it being understood and agreed that the only such information furnished by the Selling Shareholder consists of the following information in the Prospectus furnished in writing on behalf of the Selling Shareholder: the Selling Shareholder’s name and the information relating to the principal shareholders and Selling Shareholder’s holdings of Shares set forth in the section entitled “Principal and Selling Shareholders”.
The Selling Shareholder has not taken and will not take, directly or indirectly, any action that is designed to or that might reasonably be expected to cause or result in unlawful stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Shares.
3. Agreements to Sell and Purchase. The Company hereby agrees to issue and sell, and the Selling Shareholder hereby agrees to sell, to the several Underwriters, and each Underwriter, upon the basis of the representations and warranties herein contained, but subject to the conditions hereinafter stated, agrees, severally and not jointly, to subscribe for and purchase from the Company and to purchase from the Selling Shareholder at $[        ] a share (the “ Purchase Price ”) the number of Firm Shares (subject to such adjustments to eliminate fractional shares as you may determine) that bears the same proportion to the number of Firm Shares to be sold by such Seller as the number of Firm Shares set forth in Schedule II hereto opposite the name of such Underwriter bears to the total number of Firm Shares.
On the basis of the representations and warranties contained in this Agreement, and subject to its terms and conditions, the Selling Shareholder agrees to sell to the Underwriters the Additional Shares, and the Underwriters shall have the right to purchase, severally and not jointly, up to [        ] Additional Shares at the Purchase Price, provided, however, that the amount paid by the Underwriters for any Additional Shares shall be reduced by an amount per share equal to any dividends declared by the Company and payable on the Firm Shares but not payable on such Additional Shares. You may exercise this right on behalf of the Underwriters in whole or from time to time in part by giving written notice not later than 60 days after the date of this Agreement. Any exercise notice shall specify the number of Additional Shares to be subscribed for and purchased by the Underwriters and the date on which such shares are to be subscribed for and purchased. Each purchase date must be at least one business day after the written notice is given and may not be earlier than the closing date for the Firm Shares nor later than ten business days after the date of such notice. Additional Shares may be subscribed for and purchased as provided in Section 5 hereof solely for the purpose of covering over-allotments made in connection with the offering of the Firm Shares. On each day, if any, that Additional Shares are to be subscribed for and purchased (an “ Option Closing Date ”), each Underwriter agrees, severally and not
 
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jointly, to subscribe for and purchase the number of Additional Shares (subject to such adjustments to eliminate fractional shares as you may determine) that bears the same proportion to the total number of Additional Shares to be purchased on such Option Closing Date as the number of Firm Shares set forth in Schedule II hereto opposite the name of such Underwriter bears to the total number of Firm Shares.
The Company hereby agrees that, without the prior written consent of (a) Morgan Stanley & Co. LLC and (b) Credit Suisse Securities (USA) LLC or Itaú BBA USA Securities, Inc. on behalf of the Underwriters, it will not, during the period ending 180 days after the date of the Prospectus (the “ Restricted Period ”), (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock beneficially owned (as such term is used in Rule 13d-3 of the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”) or any other securities so owned convertible into or exercisable or exchangeable for Common Stock or (2) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Common Stock, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise or (3) file any registration statement with the Commission relating to the offering of any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock.
The restrictions contained in the preceding paragraph shall not apply to (a) the Shares to be sold hereunder, (b) the issuance by the Company of shares of Common Stock upon the exercise of an option or warrant or the conversion of a security outstanding on the date hereof of which the Underwriters have been advised in writing, or (c) the establishment of a trading plan pursuant to Rule 10b5-1 under the Exchange Act for the transfer of shares of Common Stock; provided that (i) such plan does not provide for the transfer of Common Stock during the Restricted Period and (ii) to the extent a public announcement or filing under the Exchange Act, if any, is required of or voluntarily made by the Company regarding the establishment of such plan, such announcement or filing shall include a statement to the effect that no transfer of Common Stock may be made under such plan during the Restricted Period.
Notwithstanding the foregoing, if (1) during the last 17 days of the Restricted Period the Company issues an earnings release or material news or a material event relating to the Company occurs; or (2) prior to the expiration of the Restricted Period, the Company announces that it will release earnings results during the 16-day period beginning on the last day of the Restricted Period, the restrictions imposed by this agreement shall continue to apply until the expiration of the 18-day period beginning on the issuance of the earnings release or the occurrence of the material news or material event. The Company shall provide the Representatives and each individual subject to the Restricted Period pursuant to the lock-up letters described in Section 6(k) with prior notice of any such announcement that gives rise to an extension of the initial Restricted Period.
 
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If the Representatives, in their sole discretion, agree to release or waive the restrictions set forth in a lock-up letter described in Section 6(k) hereof for an officer or director of the Company and provides the Company with notice of the impending release or waiver at least three business days before the effective date of the release or waiver, the Company agrees to announce the impending release or waiver by a press release substantially in the form of Exhibit B hereto through a major news service at least two business days before the effective date of the release or waiver.
4. Terms of Public Offering . The Sellers are advised by you that the Underwriters propose to make a public offering of their respective portions of the Shares as soon after the Registration Statement and this Agreement have become effective as in your judgment is advisable. The Sellers are further advised by you that the Shares are to be offered to the public initially at $[        ] a share (the “ Public Offering Price ”) and to certain dealers selected by you at a price that represents a concession not in excess of $[        ] a share under the Public Offering Price, and that any Underwriter may allow, and such dealers may reallow, a concession, not in excess of $[        ] a share, to any Underwriter or to certain other dealers.
5. Payment and Delivery . Payment for the Firm Shares to be sold by each Seller shall be made to such Seller in Federal or other funds immediately available in New York City of such Firm Shares for the respective accounts of the several Underwriters at 10:00 a.m., New York City time, on [            ], 2014, or at such other time on the same or such other date, not later than [            ], 2014, as shall be designated in writing by you. The time and date of such payment are hereinafter referred to as the “ Closing Date .”
Payment for any Additional Shares shall be made to the Selling Shareholder in Federal or other funds immediately available in New York City against delivery of such Additional Shares for the respective accounts of the several Underwriters at 10:00 a.m., New York City time, on the date specified in the corresponding notice described in Section 3 or at such other time on the same or on such other date, in any event not later than [            , 2014], as shall be designated in writing by you.
The Firm Shares and Additional Shares shall be registered in such names and in such denominations as you shall request in writing not later than one full business day prior to the Closing Date or the applicable Option Closing Date, as the case may be. The Firm Shares and Additional Shares shall be delivered to you on the Closing Date or an Option Closing Date, as the case may be, for the respective accounts of the several Underwriters. The Purchase Price payable by the Underwriters for any Firm Shares and Additional Shares to be sold by the Selling Shareholder shall be reduced by (i) any transfer taxes paid by, or on behalf of, the Underwriters in connection with the transfer of such Shares to the Underwriters duly paid and (ii) any withholding required by law. With respect to any Firm Shares and Additional Shares issued by the Company and subscribed for by the Underwriters, the Company agrees and undertakes to reimburse and indemnify the Underwriters with respect to (i) any transfer taxes paid by, or on behalf of, the Underwriters in connection with the transfer of such Shares to the Underwriters duly paid and (ii) any withholding required by law.
 
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6. Conditions to the Underwriters’ Obligations . The obligations of the Sellers to sell the Shares to the Underwriters and the several obligations of the Underwriters to subscribe for, purchase and pay for the Shares on the Closing Date are subject to the condition that the Registration Statement shall have become effective not later than [            ] (New York City time) on the date hereof.
The several obligations of the Underwriters are subject to the following further conditions:
(a) Subsequent to the execution and delivery of this Agreement and prior to the Closing Date:
(i) there shall not have occurred any downgrading, nor shall any notice have been given of any intended or potential downgrading or of any review for a possible change that does not indicate the direction of the possible change, in the rating accorded any of the securities of the Company or any of its subsidiaries by any “nationally recognized statistical rating organization,” as such term is defined in Section 3(a)(62) of the Exchange Act; and
(ii) there shall not have occurred any change, or any development involving a prospective change, in the condition, financial or otherwise, or in the earnings, business or operations of the Company and its subsidiaries, taken as a whole, from that set forth in the Time of Sale Prospectus that, in your judgment, is material and adverse and that makes it, in your judgment, impracticable to market the Shares on the terms and in the manner contemplated in the Time of Sale Prospectus.
(b) The Underwriters shall have received on the Closing Date (i) a certificate, dated the Closing Date and signed by the Chief Executive Officer or Chief Financial Officer of the Company, to the effect set forth in Section 6(a)(i) above and to the effect that the representations and warranties of the Company contained in this Agreement are true and correct as of the Closing Date and that the Company has complied with all of the agreements and satisfied all of the conditions on its part to be performed or satisfied hereunder on or before the Closing Date; and (ii) a certificate of each Selling Shareholder or Attorney-in-Fact therefor, as applicable, dated the Closing Date, to the effect that the representations and warranties of the Selling Shareholder in this Agreement are true and correct as of the Closing Date and the Selling Shareholder has complied with all of the agreements and satisfied all of the conditions on its part to be performed or satisfied hereunder on or before to the Closing Date.
The officers signing and delivering such certificates may rely upon the best of his or her knowledge as to proceedings threatened.
(c) The Underwriters shall have received on the Closing Date an opinion and negative assurance letter of Kirkland & Ellis LLP, outside U.S. counsel for the Company and the Selling Shareholder, dated the Closing Date, substantially in the form of Exhibit C 2 .

2  	Draft opinions being reviewed separately.	
 
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(d) The Underwriters shall have received on the Closing Date an opinion of Arendt & Medernach, outside Luxembourg counsel for the Company, dated the Closing Date, substantially in the form of Exhibit D.
(e) The Underwriters shall have received on the Closing Date an opinion and negative assurance letter of Souza, Cescon, Barrieu, & Flesch Advogados, outside Brazilian counsel for the Company, dated the Closing Date, substantially in the form of Exhibit E.
(f) The Underwriters shall have received on the Closing Date an opinion of Arendt & Medernach and Kirkland & Ellis LLP, counsel for the Selling Shareholder, dated the Closing Date, substantially in the form of Exhibit F.
(g) The Underwriters shall have received on the Closing Date an opinion and negative assurance letter of Simpson Thacher & Bartlett LLP, U.S. counsel for the Underwriters, dated the Closing Date, with respect to such matters as the Representatives may require and in form and substance satisfactory to the Representatives, and the Company shall have furnished to such counsel such documents as they request for the purpose of enabling them to pass upon such matters.
(h) The Underwriters shall have received on the Closing Date an opinion and negative assurance letter of Lefosse Advogados, Brazilian counsel for the Underwriters, dated the Closing Date, with respect to such matters as the Representatives may require and in form and substance satisfactory to the Representatives, and the Company shall have furnished to such counsel such documents as they request for the purpose of enabling them to pass upon such matters.
(i) The Underwriters shall have received on the Closing Date an opinion of Elvinger, Hoss & Prussen, Luxembourg counsel for the Underwriters, dated the Closing Date, with respect to such matters as the Representatives may require and in form and substance satisfactory to the Representatives, and the Company shall have furnished to such counsel such documents as they request for the purpose of enabling them to pass upon such matters.
(j) The Underwriters shall have received, on each of the date hereof and the Closing Date, a letter dated the date hereof or the Closing Date, as the case may be, in form and substance satisfactory to the Underwriters, from Ernst & Young, S.L, independent public accountants, containing statements and information of the type ordinarily included in accountants’ “comfort letters” to
 
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underwriters with respect to the financial statements and certain financial information contained in the Registration Statement, the Time of Sale Prospectus and the Prospectus; provided that the letter delivered on the Closing Date shall use a “cut-off date” not earlier than the date hereof.
(k) The “lock-up” agreements, each substantially in the form of Exhibit A hereto, between you and the Selling Shareholder, officers and directors of the Company relating to sales and certain other dispositions of shares of Common Stock or certain other securities, delivered to you on or before the date hereof, shall be in full force and effect on the Closing Date.
(l) The Shares shall have been approved to be listed on the New York Stock Exchange.
(m) FINRA has confirmed that it has not raised any objection with respect to the fairness and reasonableness of the underwriting terms and arrangements relating to the offering of the Shares.
(n) The Reorganization Transaction (as defined in the Prospectus) shall have been consummated.
(o) The several obligations of the Underwriters to subscribe for and purchase Additional Shares hereunder are subject to the delivery to you on the applicable Option Closing Date of the following:
(i) a certificate, dated the Option Closing Date and signed by the Chief Executive Officer or the Chief Financial Officer of the Company, confirming that the certificate delivered on the Closing Date pursuant to Section 6(b) hereof remains true and correct as of such Option Closing Date;
(ii) a certificate, dated the Option Closing Date and signed by an each Selling Shareholder or the Attorney-in-Fact therefor, as applicable, confirming that the certificate delivered on the Closing Date pursuant to Section 6(b) hereof remains true and correct as of such Option Closing Date;
(iii) an opinion of Kirkland & Ellis LLP, outside U.S. counsel for the Company and the Selling Shareholder, dated the Option Closing Date, relating to the Additional Shares to be purchased on such Option Closing Date and otherwise to the same effect as the opinion required by Section 6(c) hereof;
(iv) an opinion of Arendt & Medernach, outside Luxembourg for the Company, dated the Option Closing Date, relating to the Additional Shares to be purchased on such Option Closing Date and otherwise to the same effect as the opinion required by Section 6(d) hereof;
 
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(v) an opinion of Souza, Cescon, Barrieu, & Flesch Advogados, outside Brazilian counsel for the Company, dated the Option Closing Date, relating to the Additional Shares to be purchased on such Option Closing Date and otherwise to the same effect as the opinion required by Section 6(e) hereof;
(vi) an opinion of Arendt & Medernach and Kirkland & Ellis LLP, outside counsel for the Selling Shareholder, dated the Option Closing Date, relating to the Additional Shares to be purchased on such Option Closing Date and otherwise to the same effect as the opinion required by Section 6(f) hereof;
(vii) an opinion of Simpson Thacher & Bartlett LLP, U.S. counsel for the Underwriters, dated the Option Closing Date, relating to the Additional Shares to be purchased on such Option Closing Date and otherwise to the same effect as the opinion required by Section 6(g) hereof;
(viii) an opinion of Lefosse Advogados, Brazilian counsel for the Underwriters, dated the Option Closing Date, relating to the Additional Shares to be purchased on such Option Closing Date and otherwise to the same effect as the opinion required by Section 6(h) hereof;
(ix) an opinion of Elvinger, Hoss & Prussen, Luxembourg counsel for the Underwriters, dated the Option Closing Date, relating to the Additional Shares to be purchased on such Option Closing Date and otherwise to the same effect as the opinion required by Section 6(i) hereof;
(x) a letter dated the Option Closing Date, in form and substance satisfactory to the Underwriters, from Ernst & Young, S.L, independent public accountants, substantially in the same form and substance as the letter furnished to the Underwriters pursuant to Section 6(j) hereof; provided that the letter delivered on the Option Closing Date shall use a “cut-off date” not earlier than three business days prior to such Option Closing Date; and
(xi) such other documents as you may reasonably request with respect to the good standing of the Company, the due authorization and issuance of the Additional Shares to be sold on such Option Closing Date and other matters related to the issuance of such Additional Shares.
7. Covenants of the Company and the Selling Shareholder . Each of the Company and, to the extent applicable, the Selling Shareholder covenant with each Underwriter as follows:
(a) The Company will comply with the requirements of Rule 430A, and will notify the Representatives promptly, and confirm the notice in writing, (A) when any post-effective amendment to the Registration Statement shall
 
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become effective or any amendment or supplement to the Prospectus shall have been filed, (B) of the receipt of any comments from the Commission, (C) of any request by the Commission for any amendment to the Registration Statement or any amendment or supplement to the Prospectus or for additional information, and (D) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or any post-effective amendment or of any order preventing or suspending the use of any preliminary prospectus or the Prospectus, or of the suspension of the qualification of the Securities for offering or sale in any jurisdiction. The Company will make every reasonable effort to prevent the issuance of any stop order, prevention or suspension and, if any such order is issued, to obtain the lifting thereof at the earliest possible moment.
(b) To furnish to you, without charge, nine signed copies of the Registration Statement (including exhibits thereto) and for delivery to each other Underwriter a conformed copy of the Registration Statement (without exhibits thereto) and to furnish to you in New York City, without charge, prior to 10:00 a.m. New York City time on the business day next succeeding the date of this Agreement and during the period mentioned in Section 7(f) or 7(g) below, as many copies of the Time of Sale Prospectus, the Prospectus and any supplements and amendments thereto or to the Registration Statement as you may reasonably request.
(c) Before amending or supplementing the Registration Statement, the Time of Sale Prospectus or the Prospectus, to furnish to you a copy of each such proposed amendment or supplement and not to file any such proposed amendment or supplement to which you reasonably object, and to file with the Commission within the applicable period specified in Rule 424(b) under the Securities Act any prospectus required to be filed pursuant to such Rule.
(d) To furnish to you a copy of each proposed free writing prospectus to be prepared by or on behalf of, used by, or referred to by the Company and not to use or refer to any proposed free writing prospectus to which you reasonably object.
(e) Not to take any action that would result in an Underwriter or the Company being required to file with the Commission pursuant to Rule 433(d) under the Securities Act a free writing prospectus prepared by or on behalf of the Underwriter that the Underwriter otherwise would not have been required to file thereunder.
(f) If the Time of Sale Prospectus is being used to solicit offers to buy the Shares at a time when the Prospectus is not yet available to prospective purchasers and any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Time of Sale Prospectus in order to make the statements therein, in the light of the circumstances, not misleading, or if any event shall occur or condition exist as a result of which the Time of Sale Prospectus conflicts with the information contained in the Registration Statement
 
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then on file, or if, in the opinion of counsel for the Underwriters, it is necessary to amend or supplement the Time of Sale Prospectus to comply with applicable law, forthwith to prepare, file with the Commission and furnish, at its own expense, to the Underwriters and to any dealer upon request, either amendments or supplements to the Time of Sale Prospectus so that the statements in the Time of Sale Prospectus as so amended or supplemented will not, in the light of the circumstances when the Time of Sale Prospectus is delivered to a prospective purchaser, be misleading or so that the Time of Sale Prospectus, as amended or supplemented, will no longer conflict with the Registration Statement, or so that the Time of Sale Prospectus, as amended or supplemented, will comply with applicable law.
(g) If, during such period after the first date of the public offering of the Shares as in the opinion of counsel for the Underwriters the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) of the Securities Act) is required by law to be delivered in connection with sales by an Underwriter or dealer, any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Prospectus in order to make the statements therein, in the light of the circumstances when the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) of the Securities Act) is delivered to a purchaser, not misleading, or if, in the opinion of counsel for the Underwriters, it is necessary to amend or supplement the Prospectus to comply with applicable law, forthwith to prepare, file with the Commission and furnish, at its own expense, to the Underwriters and to the dealers (whose names and addresses you will furnish to the Company) to which Shares may have been sold by you on behalf of the Underwriters and to any other dealers upon request, either amendments or supplements to the Prospectus so that the statements in the Prospectus as so amended or supplemented will not, in the light of the circumstances when the Prospectus (or in lieu thereof the notice referred to in Rule 173(a) of the Securities Act) is delivered to a purchaser, be misleading or so that the Prospectus, as amended or supplemented, will comply with applicable law.
(h) The Company will use its best efforts to effect the listing of the Shares on the NYSE.
(i) To endeavor to qualify the Shares for offer and sale under the securities or Blue Sky laws of such jurisdictions as you shall reasonably request.
(j) To make generally available to the Company’s security holders and to you as soon as practicable an earnings statement covering a period of at least twelve months beginning with the first fiscal quarter of the Company occurring after the date of this Agreement which shall satisfy the provisions of Section 11(a) of the Securities Act and the rules and regulations of the Commission thereunder
(k) The Company and the Selling Shareholder shall not take, directly or indirectly, during the distribution period for Shares, any action designed to or that could reasonably be expected to cause or result in any stabilization or manipulation of the price of the Shares.
 
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(l) All payments to be made by the Company and the Selling Shareholder under this Agreement shall be made without withholding or deduction for or on account of any present or future taxes, duties or governmental charges whatsoever unless the Company and the Selling Shareholder are compelled by law to deduct or withhold such taxes, duties or charges. In that event, the Company and the Selling Shareholder shall pay such additional amounts as may be necessary in order that the net amounts received after such withholding or deduction shall equal the amounts that would have been received if no withholding or deduction had been made, except to the extent that such taxes, duties or charges (i) were imposed by reason of any present or former connection between an Underwriter and Luxembourg, otherwise than solely from the execution of this Agreement or the receipt of payments hereunder or thereunder; (ii) would not have been imposed but for the failure of such Underwriter to comply with any certification, identification or other reporting requirements concerning nationality, residence, identity or connection with Luxembourg of such Underwriter if such compliance is required or imposed by law as a precondition to an exemption from, or reduction in, such tax, duty or charge and (iii) are required in respect of the Luxembourg laws of 21 June 2005 implementing the Council Directive 2003/48/EC of 3 June 2003 on taxation of savings income in the form of interest payments (or any amendment thereof) and ratifying the treaties entered into by Luxembourg and certain dependent and associated territories of EU Member States or the Luxembourg law of 23 December 2005 (as amended) introducing in Luxembourg a 10% withholding tax as regards Luxembourg resident individuals. The Company and the Selling Shareholder further agree to indemnify and hold harmless the Underwriters against any documentary, stamp, financial transaction or similar issuance or recordation tax, including any interest and penalties, on the placement of the Shares and on the execution and delivery of this Agreement.
8. Covenants of the Sellers . Each Seller, severally and not jointly, covenants with each Underwriter as follows:
(a) Each Seller will deliver to each Underwriter (or its agent), prior to or at the Closing Date, a properly completed and executed Internal Revenue Service (“ IRS ”) Form W-9 or an IRS Form W-8, as appropriate, together with all required attachments to such form.
9. Expenses . Whether or not the transactions contemplated in this Agreement are consummated or this Agreement is terminated, the Sellers agree to pay or cause to be paid all expenses incident to the performance of their obligations under this Agreement, including: (i) the fees, disbursements and expenses of the Company’s counsel, the Company’s accountants and counsels for the Selling Shareholder, and out-of-pocket expenses of the Underwriters up to a cap of US$250,000, in connection with the registration and delivery of the Shares under the Securities Act and all other fees or
 
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expenses in connection with the preparation and filing of the Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, the Prospectus, any free writing prospectus prepared by or on behalf of, used by, or referred to by the Company and amendments and supplements to any of the foregoing, including all printing costs associated therewith, and the mailing and delivering of copies thereof to the Underwriters and dealers, in the quantities hereinabove specified, (ii) all costs and expenses related to the transfer and delivery of the Shares to the Underwriters, including any transfer or other taxes payable thereon, (iii) the cost of printing or producing any Blue Sky or Legal Investment memorandum in connection with the offer and sale of the Shares under state securities laws and all expenses in connection with the qualification of the Shares for offer and sale under state securities laws as provided in Section 7(h) hereof, including filing fees and the reasonable fees and disbursements of counsel for the Underwriters in connection with such qualification and in connection with the Blue Sky or Legal Investment memorandum, (iv) all filing fees and the reasonable fees and disbursements of counsel to the Underwriters incurred in connection with the review and qualification of the offering of the Shares by the Financial Industry Regulatory Authority, (v) all fees and expenses in connection with the preparation and filing of the registration statement on Form 8-A relating to the Common Stock and all costs and expenses incident to listing the Shares on the NYSE, (vi) the cost of printing certificates representing the Shares, (vii) the costs and charges of any transfer agent, registrar or depositary, (viii) the costs and expenses of the Company relating to investor presentations on any “road show” undertaken in connection with the marketing of the offering of the Shares, including, without limitation, expenses associated with the preparation or dissemination of any electronic road show, expenses associated with the production of road show slides and graphics, fees and expenses of any consultants engaged in connection with the road show presentations with the prior approval of the Company, travel and lodging expenses of the representatives and officers of the Company and any such consultants, and 50% of the cost of any aircraft chartered in connection with the road show, (ix) the document production charges and expenses associated with printing this Agreement, and (x) all other costs and expenses incident to the performance of the obligations of the Company hereunder for which provision is not otherwise made in this Section. It is understood, however, that except as provided in this Section, Section 11 entitled “Indemnity and Contribution” and the last paragraph of Section 14 below, the Underwriters will pay all of their costs and expenses, including fees and disbursements of their counsel, share transfer taxes payable on resale of any of the Shares by them and any advertising expenses connected with any offers they may make.
The provisions of this Section shall not supersede or otherwise affect any agreement that the Sellers may otherwise have for the allocation of such expenses among themselves.
10. Covenants of the Underwriters . Each Underwriter severally covenants with the Company not to take any action that would result in the Company being required to file with the Commission under Rule 433(d) a free writing prospectus prepared by or on behalf of such Underwriter that otherwise would not be required to be filed by the Company thereunder, but for the action of the Underwriter.
 
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11. Indemnity and Contribution . (a) The Company agrees to indemnify and hold harmless each Underwriter, each person, if any, who controls any Underwriter within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act, and each affiliate of any Underwriter within the meaning of Rule 405 under the Securities Act from and against any and all losses, claims, damages and liabilities (including, without limitation, any legal or other expenses reasonably incurred in connection with defending or investigating any such action or claim) caused by any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or any amendment thereof, any preliminary prospectus, the Time of Sale Prospectus or any amendment or supplement thereto, any issuer free writing prospectus as defined in Rule 433(h) under the Securities Act, any Company information that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act, any “road show” as defined in Rule 433 (h) under the Securities Act (a “road show”) or the Prospectus or any amendment or supplement thereto, or caused by any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as such losses, claims, damages or liabilities are caused by any such untrue statement or omission or alleged untrue statement or omission based upon information relating to any Underwriter furnished to the Company in writing by such Underwriter through the Representatives or directly expressly for use therein. The Company agrees and confirms that references to “affiliates” of Morgan Stanley & Co. LLC that appear in this Agreement shall be understood to include Mitsubishi UFJ Morgan Stanley Securities Co., Ltd.
(b) The Selling Shareholder agrees, jointly and severally, to indemnify and hold harmless each Underwriter, each person, if any, who controls the Company within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act, and each affiliate of any Underwriter within the meaning of Rule 405 under the Securities Act, from and against any and all losses, claims, damages and liabilities (including, without limitation, any legal or other expenses reasonably incurred in connection with defending or investigating any such action or claim) caused by any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or any amendment thereof, any preliminary prospectus, the Time of Sale Prospectus or any amendment or supplement thereto, any issuer free writing prospectus as defined in Rule 433(h) under the Securities Act, any Company information that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act, and road show or the Prospectus or any amendment or supplement thereto, or caused by any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, but only with reference to information relating to the Selling Shareholder furnished in writing by or on behalf of the Selling Shareholder expressly for use in the Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, any issuer free writing prospectus, road show or the Prospectus or any amendment or supplement thereto.
 
27

(c) Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Company, the Selling Shareholder, the directors of the Company, the officers of the Company who sign the Registration Statement and each person, if any, who controls the Company or any Selling Shareholder within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act from and against any and all losses, claims, damages and liabilities (including, without limitation, any legal or other expenses reasonably incurred in connection with defending or investigating any such action or claim) caused by any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or any amendment thereof, any preliminary prospectus, the Time of Sale Prospectus or any amendment or supplement thereto, any issuer free writing prospectus as defined in Rule 433(h) under the Securities Act, any Company information that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act, any road show or the Prospectus or any amendment or supplement thereto, or caused by any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, but only with reference to information relating to such Underwriter furnished to the Company in writing by such Underwriter through you expressly for use in the Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, any issuer free writing prospectus, road show, or the Prospectus or any amendment or supplement thereto; it being understood and agreed that the only such information furnished by any Underwriter consists of the following information in the Prospectus furnished in writing on behalf of such Underwriter: (i) paragraphs three, seven, fifteen, the first sentence of paragraph seventeen, and paragraph eighteen under the heading “Underwriting”; (ii) only with respect to Banco BTG Pactual S.A.-Cayman Branch, paragraph eight under the heading “Underwriting”; and (iii) only with respect to Banco Bradesco BBI S.A., paragraph nine under the heading “Underwriting”.
(d) In case any proceeding (including any governmental investigation) shall be instituted involving any person in respect of which indemnity may be sought pursuant to Section 11(a), 11(b) or 11(c), such person (the “ indemnified party ”) shall promptly notify the person against whom such indemnity may be sought (the “ indemnifying party ”) in writing and the indemnifying party, upon request of the indemnified party, shall retain counsel reasonably satisfactory to the indemnified party to represent the indemnified party and any others the indemnifying party may designate in such proceeding and shall pay the fees and disbursements of such counsel related to such proceeding. In any such proceeding, any indemnified party shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such indemnified party unless (i) the indemnifying party and the indemnified party shall have mutually agreed to the retention of such counsel or (ii) the named parties to any such proceeding (including any impleaded parties) include both the indemnifying party and the indemnified party and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them. It is understood that the indemnifying party shall not, in
 
28

respect of the legal expenses of any indemnified party in connection with any proceeding or related proceedings in the same jurisdiction, be liable for (i) the fees and expenses of more than one separate firm (in addition to any local counsel) for all Underwriters and all persons, if any, who control any Underwriter within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act or who are affiliates of any Underwriter within the meaning of Rule 405 under the Securities Act, (ii) the fees and expenses of more than one separate firm (in addition to any local counsel) for the Company, its directors, its officers who sign the Registration Statement and each person, if any, who controls the Company within the meaning of either such Section and (iii) the fees and expenses of more than one separate firm (in addition to any local counsel) for all Selling Shareholder and all persons, if any, who control any Selling Shareholder within the meaning of either such Section, and that all such fees and expenses shall be reimbursed as they are incurred. In the case of any such separate firm for the Underwriters and such control persons and affiliates of any Underwriters, such firm shall be designated in writing by the Representatives. In the case of any such separate firm for the Company, and such directors, officers and control persons of the Company, such firm shall be designated in writing by the Company. In the case of any such separate firm for the Selling Shareholder and such control persons of any Selling Shareholder, such firm shall be designated in writing by the Selling Shareholder. The indemnifying party shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party from and against any loss or liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel as contemplated by the second and third sentences of this paragraph, the indemnifying party agrees that it shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 90 days after receipt by such indemnifying party of the aforesaid request and (ii) such indemnifying party shall not have reimbursed the indemnified party in accordance with such request prior to the date of such settlement. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding.
(e) To the extent the indemnification provided for in Section 11(a), 11(b) or 11(c) is unavailable to an indemnified party or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each indemnifying party under such paragraph, in lieu of indemnifying such indemnified party thereunder, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the
 
29

indemnifying party or parties on the one hand and the indemnified party or parties on the other hand from the offering of the Shares or (ii) if the allocation provided by clause 11(e)(i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause 11(e)(i) above but also the relative fault of the indemnifying party or parties on the one hand and of the indemnified party or parties on the other hand in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Sellers on the one hand and the Underwriters on the other hand in connection with the offering of the Shares shall be deemed to be in the same respective proportions as the net proceeds from the offering of the Shares (before deducting expenses) received by each Seller and the total underwriting discounts and commissions received by the Underwriters, in each case as set forth in the table on the cover of the Prospectus, bear to the aggregate Public Offering Price of the Shares. The relative fault of the Sellers on the one hand and the Underwriters on the other hand shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Sellers or by the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Underwriters’ respective obligations to contribute pursuant to this Section 11 are several in proportion to the respective number of Shares they have purchased hereunder, and not joint.
(f) The Sellers and the Underwriters agree that it would not be just or equitable if contribution pursuant to this Section 11 were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in Section 11(e). The amount paid or payable by an indemnified party as a result of the losses, claims, damages and liabilities referred to in Section 11(e) shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 11, no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Shares underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages that such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The remedies provided for in this Section 11 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity.
(g) The indemnity and contribution provisions contained in this Section 11 and the representations, warranties and other statements of the
 
30

Company and the Selling Shareholder contained in this Agreement shall remain operative and in full force and effect regardless of (i) any termination of this Agreement, (ii) any investigation made by or on behalf of any Underwriter, any person controlling any Underwriter or any affiliate of any Underwriter, any Selling Shareholder or any person controlling any Selling Shareholder, or the Company, its officers or directors or any person controlling the Company and (iii) acceptance of and payment for any of the Shares.
12. [Reserved.]
13. Termination . The Underwriters may terminate this Agreement by notice given by you to the Company, if after the execution and delivery of this Agreement and prior to the Closing Date (i) trading generally shall have been suspended or materially limited on, or by, as the case may be, any of the NYSE or the NASDAQ Global Market, (ii) trading of any securities of the Company shall have been suspended on any exchange or in any over-the-counter market, (iii) a material disruption in securities settlement, payment or clearance services in the United States shall have occurred, (iv) any moratorium on commercial banking activities shall have been declared by Federal or New York State authorities in Brazil or (v) there shall have occurred any outbreak or escalation of hostilities, or any change in financial markets, or any calamity or crisis that, in your judgment, is material and adverse and which, individually or together with any other event specified in this clause (v), makes it, in your judgment, impracticable or inadvisable to proceed with the offer, sale or delivery of the Shares on the terms and in the manner contemplated in the Time of Sale Prospectus or the Prospectus.
14. Effectiveness; Defaulting Underwriters . This Agreement shall become effective upon the execution and delivery hereof by the parties hereto.
If, on the Closing Date or an Option Closing Date, as the case may be, any one or more of the Underwriters shall fail or refuse to purchase Shares that it has or they have agreed to subscribe for and purchase hereunder on such date, and the aggregate number of Shares which such defaulting Underwriter or Underwriters agreed but failed or refused to subscribe for and purchase is not more than one-tenth of the aggregate number of the Shares to be subscribed for and on such date, the other Underwriters shall be obligated severally in the proportions that the number of Firm Shares set forth opposite their respective names in Schedule II bears to the aggregate number of Firm Shares set forth opposite the names of all such non-defaulting Underwriters, or in such other proportions as you may specify, to subscribe for and purchase the Shares which such defaulting Underwriter or Underwriters agreed but failed or refused to subscribe for and purchase on such date; provided that in no event shall the number of Shares that any Underwriter has agreed to subscribe for and purchase pursuant to this Agreement be increased pursuant to this Section 14 by an amount in excess of one-ninth of such number of Shares without the written consent of such Underwriter. If, on the Closing Date, any Underwriter or Underwriters shall fail or refuse to subscribe for and purchase Firm Shares and the aggregate number of Firm Shares with respect to which such default occurs is more than one-tenth of the aggregate number of Firm Shares to be subscribed for and purchased on such date, and arrangements satisfactory to you, the Company and the Selling
 
31

Shareholder for the purchase of such Firm Shares are not made within 36 hours after such default, this Agreement shall terminate without liability on the part of any non-defaulting Underwriter, the Company or the Selling Shareholder. In any such case either you or the relevant Sellers shall have the right to postpone the Closing Date, but in no event for longer than seven days, in order that the required changes, if any, in the Registration Statement, in the Time of Sale Prospectus, in the Prospectus or in any other documents or arrangements may be effected. If, on an Option Closing Date, any Underwriter or Underwriters shall fail or refuse to subscribe for and purchase Additional Shares and the aggregate number of Additional Shares with respect to which such default occurs is more than one-tenth of the aggregate number of Additional Shares to be subscribed for and purchased on such Option Closing Date, the non-defaulting Underwriters shall have the option to (i) terminate their obligation hereunder to subscribe for and purchase the Additional Shares to be sold on such Option Closing Date or (ii) subscribe for and purchase not less than the number of Additional Shares that such non-defaulting Underwriters would have been obligated to subscribe for and purchase in the absence of such default. Any action taken under this paragraph shall not relieve any defaulting Underwriter from liability in respect of any default of such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of them, because of any failure or refusal on the part of any Seller to comply with the terms or to fulfill any of the conditions of this Agreement, or if for any reason any Seller shall be unable to perform its obligations under this Agreement, the Sellers will reimburse the Underwriters or such Underwriters as have so terminated this Agreement with respect to themselves, severally, for all out-of-pocket expenses (including the fees and disbursements of their counsel) reasonably incurred by such Underwriters in connection with this Agreement or the offering contemplated hereunder.
15. Entire Agreement . (a) This Agreement, together with any contemporaneous written agreements and any prior written agreements (to the extent not superseded by this Agreement) that relate to the offering of the Shares, represents the entire agreement between the Company and the Selling Shareholder, on the one hand, and the Underwriters, on the other, with respect to the preparation of any preliminary prospectus, the Time of Sale Prospectus, the Prospectus, the conduct of the offering, and the purchase and sale of the Shares.
(b) The Company acknowledges that in connection with the offering of the Shares: (i) the Underwriters have acted at arms’ length, are not agents of, and owe no fiduciary duties to, the Company or any other person, (ii) the Underwriters owe the Company only those duties and obligations set forth in this Agreement and prior written agreements (to the extent not superseded by this Agreement), if any, and (iii) the Underwriters may have interests that differ from those of the Company. The Company waives to the full extent permitted by applicable law any claims it may have against the Underwriters arising from an alleged breach of fiduciary duty in connection with the offering of the Shares.
 
32

16. Counterparts . This Agreement may be signed in two or more counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.
17. Applicable Law . This Agreement shall be governed by and construed in accordance with the internal laws of the State of New York.
18. Consent to Jurisdiction; Waiver of Immunity . Each of the Company and the Selling Shareholder hereby submits to the exclusive jurisdiction of the U.S. federal and state courts in the Borough of Manhattan in The City of New York (except for proceedings instituted in regard to the enforcement of a judgment of any such court ) in any suit or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby. The Company and each Selling Shareholder irrevocably and unconditionally waive any objection to the laying of venue of any suit or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby in U.S. federal and state courts in the Borough of Manhattan in the City of New York and irrevocably and unconditionally waive and agree not to plead or claim in any such court that any such suit or proceeding in any such court has been brought in an inconvenient forum. The Company and the Selling Shareholder have appointed [             ], at its offices located at [             ], New York, NY [        ], as their authorized agent (“ Authorized Agent ”) upon whom process may be served in any suit, action or proceeding arising out of or based upon this Agreement or the transactions contemplated herein that may be instituted in any U.S. federal or state court in New York City, by any Underwriter, the directors, officers, employees, affiliates and agents of any Underwriter, or by any person who controls any Underwriter within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act. Such appointment shall be irrevocable. Each of the Company and the Selling Shareholder hereby represents and warrants that its Authorized Agent has accepted such appointment and has agreed to act as said agent for service of process, and the Company and each Selling Shareholder agree to take any and all action, including the filing of any and all documents that may be necessary to continue such appointment in full force and effect for a period of seven years from the date of this Agreement. Service of process in compliance with applicable requirements upon the Company’s and the Selling Shareholder’s Authorized Agent shall be deemed, in every respect, effective service of process upon the Company and each Selling Shareholder. The parties hereto each hereby waive any right to trial by jury in any action, proceeding or counterclaim arising out of or relating to this Agreement.
The obligation of the Company or any Selling Shareholder pursuant to this Agreement in respect of any sum due to any Underwriter shall, notwithstanding any judgment in a currency other than United States dollars, not be discharged until the first business day, following receipt by such Underwriter of any sum adjudged to be so due in such other currency, on which (and only to the extent that) such Underwriter may in accordance with normal banking procedures purchase United States dollars with such other currency; if the United States dollars so purchased are less than the sum originally due to such Underwriter hereunder, the Company and the Selling Shareholder agree, as a separate obligation and notwithstanding any such judgment, to indemnify such Underwriter against such loss. If the United States dollars so purchased are greater than
 
33

the sum originally due to such Underwriter hereunder, such Underwriter agrees to pay to the Company or the Selling Shareholder an amount equal to the excess of the dollars so purchased over the sum originally due to such Underwriter hereunder.
19. Waiver of Immunity . To the extent that any of the Company or Selling Shareholder has or hereafter may acquire any immunity (whether on the basis of sovereignty or otherwise) from any legal action, suit or proceeding, from jurisdiction of any court or from set-off or any legal process (whether service or notice, attachment in aid or otherwise) with respect to itself or any of its property, the Company and the Selling Shareholder hereby irrevocably waive and agree not to plead or claim such immunity in respect of its obligations under this Agreement to the fullest extent permitted by applicable law.
20. Headings . The headings of the sections of this Agreement have been inserted for convenience of reference only and shall not be deemed a part of this Agreement.
21. Notices . All communications hereunder shall be in writing and effective only upon receipt and if to the Underwriters shall be delivered, mailed or sent to you (i) in care of Morgan Stanley & Co. LLC, 1585 Broadway, New York, New York 10036, Attention: Equity Syndicate Desk, with a copy to the Legal Department, (ii) in care of Credit Suisse Securities (USA) LLC, Eleven Madison Avenue, New York, N.Y. 10010-3629 Facsimile: (212) 325-4296, Attention: LCD-IBD, and (iii) in care of Itaú BBA USA Securities, Inc., [             ]; if to the Company shall be delivered, mailed or sent to C/Quintanavides, N.17-2 Planta, 28050 Las Tablas, Madrid Spain, Attention: Chief Financial Officer and if to the Selling Shareholder shall be delivered, mailed or sent to Atalaya PikCo S.C.A., Da Vinci Building, 4 rue Lou Hemmer, L-1748 Luxembourg Findel, Grand Duchy of Luxembourg, Attention: Legal Department.

Very truly yours,	
	
ATENTO S.A.	
		
By:	 	 	
	 	Name:	
	 	Title:	
[SELLING SHAREHOLDER]	
		
By:	 	 	
	 	Name:	
	 	Title:	
 
34

Accepted as of the date hereof
Morgan Stanley & Co. LLC
Credit Suisse Securities (USA) LLC
Itaú BBA USA Securities, Inc.
Acting severally on behalf of themselves and the
several Underwriters named in Schedule II hereto

By:	 	Morgan Stanley & Co. LLC	
		
By:	 	 	
	 	Name:	
	 	Title:	
		
By:	 	Credit Suisse Securities (USA) LLC	
		
By:	 	 	
	 	Name:	
	 	Title:	
		
By:	 	Itaú BBA USA Securities, Inc.	
		
By:	 	 	
	 	Name:	
	 	Title:	
 
35

SCHEDULE I

Selling Shareholder	  	Number of Firm Shares
To Be Sold	  	Number of Option
Shares To Be Sold	
[SELLING SHAREHOLDER]	  		  		

	  		  		

Total:	  		  		

SCHEDULE II

Underwriter	  	Number of Firm Shares
To Be Purchased	
Morgan Stanley & Co. LLC	  		
Credit Suisse Securities (USA) LLC	  		
Itaú BBA USA Securities, Inc.	  		
Merrill Lynch, Pierce, Fenner & Smith Incorporated	  		
Banco Bradesco BBI S.A.	  		
Banco BTG Pactual S.A.—Cayman Branch	  		
Goldman, Sachs & Co.	  		
Santander Investment Securities Inc.	  		
BBVA Securities Inc.	  		
Robert W. Baird & Co. Incorporated	  		
Total:	  		

II-1

SCHEDULE III
Time of Sale Prospectus
 
1.	Preliminary Prospectus issued [            ]	
 
2.	[to include any free writing prospectuses filed by the Company under Rule 433(d) of the Securities Act]	
 
3.	[to include orally communicated pricing information such as price per share and size of offering if a Rule 134 pricing term sheet is used at the time of sale instead of a pricing term sheet filed by the Company under Rule 433(d) as a free writing prospectus]	
 
III-1

EXHIBIT A
[FORM OF LOCK-UP LETTER]
            , 20    
Morgan Stanley & Co. LLC
1585 Broadway
New York, New York 10036
Credit Suisse Securities (USA) LLC
Eleven Madison Avenue
New York, New York 10010-3629
Itaú BBA USA Securities, Inc.
767 Fifth Avenue, 50 th Floor
New York, New York 10153
Ladies and Gentlemen:
The undersigned understands that Morgan Stanley & Co. LLC (“ Morgan Stanley ”) Credit Suisse Securities (USA) LLC (“ Credit Suisse ”) and Itaú BBA USA Securities, Inc. (together with Morgan Stanley and Credit Suisse, the “ Representatives ”) propose to enter into an Underwriting Agreement (the “ Underwriting Agreement ”) with Atento S.A., a corporation ( société anonyme ) incorporated and existing under the laws of the Grand Duchy of Luxembourg (the “ Company ”), providing for the public offering (the “ Public Offering ”) by the several Underwriters, including the Representatives (the “ Underwriters ”), of [        ] ordinary shares, par value €[             ] per ordinary share (the “ Shares ”), of (the “ Common Stock ”).
To induce the Underwriters that may participate in the Public Offering to continue their efforts in connection with the Public Offering, the undersigned hereby agrees that, without the prior written consent of (A) Morgan Stanley & Co. LLC and (B) Credit Suisse Securities (USA) LLC or Itaú BBA USA Securities, Inc. on behalf of the Underwriters, it will not, during the period commencing on the date hereof and ending 180 days after the date of the final prospectus (the “ Restricted Period )” relating to the Public Offering (the “ Prospectus ”), (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock beneficially owned (as such term is used in Rule 13d-3 of the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”)), by the undersigned or any other securities so owned convertible into or exercisable or exchangeable for Common Stock or (2) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Common Stock, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise. The foregoing sentence shall not apply to (a) transactions relating to shares of Common Stock
 
A-1

or other securities acquired in open market transactions after the completion of the Public Offering or sold pursuant to the Underwriting Agreement, (b) transfers of shares of Common Stock or any security convertible into Common Stock as a bona fide gift, (c) distributions or transfers of shares of Common Stock or any security convertible into Common Stock to the undersigned’s subsidiaries, affiliates, members, limited partners or shareholders or to any investment fund or other entity controlled by or under common control with the undersigned, (d) transfers to any trust, limited partnership or limited liability company for the direct or indirect benefit of the undersigned or any “immediate family member” (as defined in Rule 16c-1 under the Exchange Act) of the undersigned, (e) any transfer by will or intestate succession upon the death of the undersigned, (f) transfers to the Company in connection with the exercise (including cashless exercise) of convertible securities or options to purchase Common Stock pursuant to existing employee plans identified in the Prospectuses on the terms of such plans, (g) transfers in connection with the completion of a sale of 100% of the Company pursuant to a purchase agreement entered into by the Company, (h) transfers to the Company for the purpose of satisfying any tax liability (including estimated taxes) due as a result of the exercise of options or as a result of the vesting of or upon the receipt of equity awards held by the undersigned, (i) in the event any shareholder that is subject to a lockup agreement substantially in the form of this letter agreement is permitted to conduct a registered, secondary offering of Common Stock during the 180-day period referred to above and the undersigned is entitled to tag along rights with respect to such sale, to the extent of the Common Stock entitled to tag along rights in such secondary offering and only to the extent sold as part of such offering, or (j) the establishment of a trading plan pursuant to Rule 10b5-1 under the Exchange Act for the transfer of shares of Common Stock; provided that (i) such plan does not provide for the transfer of Common Stock during the Restricted Period and (ii) to the extent a public announcement or filing under the Exchange Act, if any, is required of or voluntarily made by or on behalf of the undersigned or the Company regarding the establishment of such plan, such announcement or filing shall include a statement to the effect that no transfer of Common Stock may be made under such plan during the Restricted Period; provided that in the case of any transfer or distribution pursuant to clause (b), (c), (d) or (e), each donee or distributee shall sign and deliver a lock up letter substantially in the form of this letter; provided further that in the case of any transfer or distribution pursuant to clause (a), (b), or (d) no other public announcement shall be required or shall be voluntarily made during the Restricted Period in connection with such transfer or distribution; and provided further that in the case of any transfer or distribution pursuant to clause (f), any filing by any party under the Exchange Act, or other public announcement shall be required to state that such transfer or distribution was to the Company in connection with the exercise of convertible securities or options or the vesting of equity awards in connection with an employee benefit plan. In addition, the undersigned agrees that, without the prior written consent of Morgan Stanley & Co. LLC and either Credit Suisse Securities (USA) LLC or Itaú BBA USA Securities, Inc. on behalf of the Underwriters, it will not, during the Restricted Period, make any demand for or exercise any right with respect to, the registration of any shares of Common Stock, or any security convertible into or exercisable or exchangeable for Common Stock, except as provided in clause (i) above. The undersigned also agrees and consents to the entry of stop transfer instructions with the Company’s transfer agent and registrar against the transfer of the undersigned’s shares of Common Stock except in compliance with the foregoing restrictions.
 
A-2

If the undersigned is an officer or director of the Company, Morgan Stanley & Co. LLC and either Credit Suisse Securities (USA) LLC or Itaú BBA USA Securities, Inc. agree that, at least three business days before the effective date of any release or waiver of the foregoing restrictions in connection with a transfer of shares of Common Stock, Morgan Stanley & Co. LLC and either Credit Suisse Securities (USA) LLC or Itaú BBA USA Securities, Inc. will notify the Company of the impending release or waiver, and (ii) the Company has agreed in the Underwriting Agreement to announce the impending release or waiver by press release through a major news service at least two business days before the effective date of the release or waiver. Any release or waiver granted by Morgan Stanley & Co. LLC and either Credit Suisse Securities (USA) LLC or Itaú BBA USA Securities, Inc. hereunder to any such officer or director shall only be effective two business days after the publication date of such press release. The provisions of this paragraph will not apply if (a) the release or waiver is effected solely to permit a transfer not for consideration and (b) the transferee has agreed in writing to be bound by the same terms described in this letter to the extent and for the duration that such terms remain in effect at the time of the transfer.
If:
(1) during the last 17 days of the Restricted Period the Company issues an earnings release or material news or a material event relating to the Company occurs; or
(2) prior to the expiration of the Restricted Period, the Company announces that it will release earnings results during the 16-day period beginning on the last day of the Restricted Period;
the restrictions imposed by this agreement shall continue to apply until the expiration of the 18-day period beginning on the issuance of the earnings release or the occurrence of the material news or material event. The undersigned hereby acknowledges that the Company has agreed in the Underwriting Agreement to provide written notice of any event that would result in an extension of the initial Restricted Period and agrees that any such notice properly delivered will be deemed to have been given to, and received by, the undersigned.
The undersigned understands that the Company and the Underwriters are relying upon this agreement in proceeding toward consummation of the Public Offering. The undersigned further understands that this agreement is irrevocable and shall be binding upon the undersigned’s heirs, legal representatives, successors and assigns.
This agreement shall automatically terminate upon the earliest to occur, if any, of (a) the date that the Company advises Morgan Stanley & Co. LLC and either Credit Suisse Securities (USA) LLC or Itaú BBA USA Securities, Inc., in writing, prior to the execution of the Underwriting Agreement, that it has determined not to proceed with the Public Offering, (b) the date of termination of the Underwriting Agreement if prior to the closing of the Public Offering, or (c) November 30, if the Public Offering of the Shares has not been completed by such date.
 
A-3

Whether or not the Public Offering actually occurs depends on a number of factors, including market conditions. Any Public Offering will only be made pursuant to an Underwriting Agreement, the terms of which are subject to negotiation between the Company and the Underwriters.

Very truly yours,	

(Name)	

(Address)	
 
A-4

EXHIBIT B
FORM OF WAIVER OF LOCK-UP
            , 20    
[Name and Address of
Officer or Director
Requesting Waiver]
Dear Mr./Ms. [Name]:
This letter is being delivered to you in connection with the offering by Atento S.A., a corporation ( société anonyme ) incorporated and existing under the laws of the Grand Duchy of Luxembourg (the “ Company ”) of         ordinary shares, $0.01 par value (the “ Common Stock ”), of the Company and the lock-up letter dated             , 2014 (the “ Lock-up Letter ”), executed by you in connection with such offering, and your request for a [waiver] [release] dated             , 20    , with respect to         shares of Common Stock (the “ Shares ”).
Morgan Stanley & Co. LLC and [Credit Suisse Securities (USA) LLC][ Itaú BBA USA Securities, Inc.] hereby agree to [waive] [release] the transfer restrictions set forth in the Lock-up Letter, but only with respect to the Shares, effective             , 20    ; provided, however, that such [waiver] [release] is conditioned on the Company announcing the impending [waiver] [release] by press release through a major news service at least two business days before effectiveness of such [waiver] [release]. This letter will serve as notice to the Company of the impending [waiver] [release].
Except as expressly [waived] [released] hereby, the Lock-up Letter shall remain in full force and effect.

Very truly yours,	
	
[Morgan Stanley & Co. LLC]	
[Credit Suisse Securities (USA) LLC
Itaú BBA USA Securities, Inc.]	
 
B-1

			
Acting severally on behalf of themselves and the
several Underwriters named in Schedule I hereto	
	
Morgan Stanley & Co. LLC	
		
By:	 	 	
	 	Name:	
	 	Title:	

[Credit Suisse Securities (USA) LLC	

Name:	
Title:	
	
Itaú BBA USA Securities, Inc.	

Name:	
Title: ]	
cc: Company
 
B-2

FORM OF PRESS RELEASE
[Name of Company]
[Date]
Atento S.A. (the “ Company ”) announced today that Morgan Stanley & Co. LLC and [Credit Suisse Securities (USA) LLC and/or Itaú BBA USA Securities, Inc.], the lead book-running managers in the Company’s recent public sale of         ordinary shares is [waiving][releasing] a lock-up restriction with respect to         ordinary shares of the Company held by [certain officers or directors] [an officer or director] of the Company. The [waiver][release] will take effect on             , 20    , and the shares may be sold on or after such date.
This press release is not an offer for sale of the securities in the United States or in any other jurisdiction where such offer is prohibited, and such securities may not be offered or sold in the United States absent registration or an exemption from registration under the United States Securities Act of 1933, as amended.
 
B-3

Exhibit 3.2
Amended AoA (IPO) - Atento S.A.
A. NAME - PURPOSE – DURATION - REGISTERED OFFICE
 
Article 1	Name	
There exists a public limited company ( société anonyme) under the name “ Atento S.A. ” (hereinafter the “ Company ”) which shall be governed by the law of 10 August 1915 concerning commercial companies, as amended (the “ Law ”), as well as by the present articles of association.
 
Article 2	Purpose	
2.1 The purpose of the Company is the holding of participations in any form whatsoever in Luxembourg and foreign companies and in any other form of investment, the acquisition by purchase, subscription or in any other manner as well as the transfer by sale, exchange or otherwise of securities of any kind and the administration, management, control and development of its portfolio.
2.2 The Company may further guarantee, grant security, grant loans or otherwise assist the companies in which it holds a direct or indirect participation or right of any kind or which form part of the same group of companies as the Company.
2.3 The Company may raise funds especially through borrowing in any form or by issuing any kind of notes, securities or debt instruments, bonds and debentures and generally issue any debt, equity and/or hybrid or other securities of any type in accordance with Luxembourg law.
2.4 The Company may carry out any commercial, industrial, financial, real estate, intellectual property or other activities which it considers useful for the accomplishment of these purposes.
 
Article 3	Duration	
3.1 The Company is incorporated for an unlimited period of time.
3.2 It may be dissolved at any time and with or without cause by a resolution of the general meeting of shareholders adopted in the manner required for an amendment of these articles of association.
 
Article 4	Registered office	
4.1 The registered office of the Company is in the municipality of Niederanven, Grand Duchy of Luxembourg.
4.2 Within the same municipality, the registered office may be transferred by means of a decision of the board of directors. It may be transferred to any other municipality in the Grand Duchy of Luxembourg by means of a resolution of the general meeting of shareholders, adopted in the manner required for an amendment of these articles of association.
4.3 Branches or other offices may be established either in the Grand Duchy of Luxembourg or abroad by a resolution of the board of directors.
4.4 In the event that the board of directors determines that extraordinary political, economic or social circumstances or natural disasters have occurred or are imminent that would interfere with the normal activities of the Company at its registered office, the registered office may be temporarily transferred abroad until the complete cessation of these

extraordinary circumstances; such temporary measures shall not affect the nationality of the Company which, notwithstanding the temporary transfer of its registered office, shall remain a Luxembourg company.
B. SHARE CAPITAL – SHARES
 
Article 5	Share capital	
5.1 The Company has an issued share capital of [***] euro (EUR [***]) , represented by [***] ([***]) common shares without nominal value.
5.2 The Company’s issued share capital may be increased or reduced (i) by a resolution of the general meeting of shareholders adopted in the manner required for an amendment of these articles of association or (ii) as set out in article 6 hereof.
5.3 Subject to article 6.2 of these articles of association, any new common shares to be paid for in cash will be offered by preference to the existing shareholder(s) in proportion to the number of common shares held by them in the Company’s issued share capital. The board of directors shall determine the period of time during which such preferential subscription right may be exercised. This period may not be less than thirty (30) days from the date of the opening of the subscription as published in the official gazette of the Grand Duchy of Luxembourg, Mémorial C, Recueil des Sociétés et Associations (the “ Mémorial ”) and two Luxembourg newspapers in accordance with the Law. However, subject to the provisions of the Law, the general meeting of shareholders called (i) to resolve upon an increase of the Company’s issued share capital or (ii) at the occasion of an authorization granted to the board of directors to increase the Company’s issued share capital, may limit or suppress the preferential subscription right of the existing shareholder(s) or authorize the board of directors to do so. Such resolution shall be adopted in the manner required for an amendment to these articles of association.
 
Article 6.	Authorized Capital	
6.1 The Company’s authorized capital, excluding the issued share capital, is set at one billion euro (EUR 1,000,000,000).
6.2 The board of directors is hereby authorized to issue common shares, to grant options to subscribe for common shares and to issue any other instruments convertible into common shares within the limit of the authorized share capital, to such persons and on such terms as it shall see fit, and specifically to proceed to such issue without reserving a preferential subscription right for the existing shareholders during a period of time of five (5) years from the date of publication of the resolution of the general meeting of shareholders taken on [***] in the Mémorial. This authorization may be renewed, amended or extended once or several times by a resolution of the general meeting of shareholders, adopted in the manner required for an amendment of these articles of association, each time for a period not exceeding five (5) years.
6.3 The authorized capital of the Company may be increased or reduced by a resolution of the general meeting of shareholders adopted in the manner required for amendments of these articles of association.
Article 7 Shares
7.1 The Company’s share capital is divided into common shares, without nominal value.
 
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7.2 The common shares of the Company are in registered form only. No fractional common shares shall be issued.
7.3 The common shares are freely transferable, subject to the provisions of the Law and these articles of association. The Company may repurchase its common shares and hold them in treasury subject to the conditions of the Law.
7.4 The Company will recognize only one holder per share. In case a share is owned by several persons, they shall appoint a single representative who shall represent them towards the Company. The Company has the right to suspend the exercise of all rights attached to that share until such representative has been appointed.
7.5 Death, suspension of civil rights, dissolution, bankruptcy or insolvency or any other similar event regarding any of the shareholders shall not cause the dissolution of the Company
7.6 A register of shares shall be kept at the registered office of the Company, where it shall be available for inspection by any shareholder. Ownership of registered shares will be established by inscription in such register or, in the event separate registrars have been appointed pursuant to article 7.7, in such separate register(s). Certificates of such registration shall be issued by the Company or, as the case may be, the registrar, upon request and at the expense of the relevant shareholder and, in the situation described by article 7.10 of these articles of association, to the Depositary (as defined below).
Without prejudice to the conditions for transfer by book entries provided for in article 7.10 of these articles of association, a transfer of registered common shares shall be carried out by means of a declaration of transfer entered in the relevant register, dated and signed by the transferor and the transferee or by their duly authorized representatives or by the Company upon notification of the transfer or acceptance of the transfer by the Company. The Company may accept and enter in the relevant register a transfer on the basis of correspondence or other documents recording the agreement between the transferor and the transferee.
7.7 The Company may appoint registrars in different jurisdictions who will each maintain a separate register for the registered shares entered therein and the holders of shares may elect to be entered in one of the registers and to be transferred from time to time from one register to another register. The board of directors may however impose transfer restrictions for common shares that are registered, listed, quoted, dealt in or have been placed in certain jurisdictions in compliance with the requirements applicable therein. A transfer to the register kept at the Company’s registered office may always be requested.
7.8 The board of directors may however impose transfer restrictions for common shares that are registered, listed, quoted, dealt in or have been placed in certain jurisdictions in compliance with the requirements applicable therein. A transfer to the register kept at the Company’s registered office may always be requested.
7.9 Subject to the provisions of article 7.10 and article 7.13, the Company may consider the person in whose name the registered common shares are registered in the register of shareholders as the full owner of such registered common shares. In the event that a holder of registered common shares does not provide an address in writing to which all notices or announcements from the Company may be sent, the Company may permit a notice to this effect to be entered into the register of shareholders and such holder’s address will be deemed to be at the registered office of the Company or such other address as may be so entered by the Company from time to time, until a different address shall be provided to the Company by such holder in writing. The holder may, at any time, change his address as entered in the register of shareholders by means of written notification to the Company.
 
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7.10 The common shares may be held by a holder (the “ Holder ”) through a securities settlement system or a Depositary (as this term is defined below). Subject to applicable law, the Holder of common shares held in such fungible securities accounts has the same rights and obligations as if such Holder held the common shares directly. The common shares held through a securities settlement system or a Depositary shall be recorded in an account opened in the name of the Holder and may be transferred from one account to another in accordance with customary procedures for the transfer of securities in book-entry form. However, the Company will make dividend payments, if any, and any other payments in cash, common shares or other securities, if any, only to the securities settlement system or Depositary recorded in the register of shareholders or in accordance with the instructions of such securities settlement system or Depositary. Such payment will grant full discharge of the Company’s obligations in this respect.
7.11.The board of directors may decide that no entry shall be made in the share register and no notice of a transfer shall be recognized by the Company and the registrar(s) during the period starting on the Record Date (as defined below) and ending on the closing of the relevant general meeting.
7.12 All communications and notices to be given to a registered shareholder shall be deemed validly made if made to the latest address communicated by the shareholder to the Company in accordance with article 7.9 or, if no address has been communicated by the shareholder, the registered office of the Company or such other address as may be so entered by the Company in the register from time to time according to article 7.10.
7.13 Where common shares are in registered form and are recorded in the Company’s share register in the name of or on behalf of a securities settlement system or the operator of such system and recorded as book-entry interests in the accounts of a financial institution or a professional depositary or sub-depositary (any such institution, depositary and sub-depositary being referred to hereinafter as a “ Depositary ”), the Company, subject to having received from the Depositary a proper certification of such record position, will permit the depositor of such book-entry interests to exercise the rights attached to the common shares corresponding to the book-entry interests of the relevant depositor, including receiving notices of general meetings, admission to and voting at general meetings, and shall consider the Depositary to be the holder of the common shares corresponding to the book entry interests for purposes of this article 7 of these articles of association (the “ Certificates ”). The board of directors may determine formal requirements with which such Certificates must comply.
C. GENERAL MEETINGS OF SHAREHOLDERS
 
Article 8	Powers of the general meeting of shareholders	
8.1 The shareholders exercise their collective rights in the general meeting of shareholders. Any regularly constituted general meeting of shareholders of the Company shall represent the entire body of shareholders of the Company. The general meeting of shareholders is vested with the powers expressly reserved to it by the Law and by these articles of association.
8.2 If the Company has only one shareholder, any reference made herein to the “general meeting of shareholders” shall be construed as a reference to the “sole shareholder”, depending on the context and as applicable and powers conferred upon the general meeting of shareholders shall be exercised by the sole shareholder.
 
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Article 9	Convening of general meetings of shareholders	
9.1 The general meeting of shareholders of the Company may at any time be convened by the board of directors, to be held at such place and on such date as specified in the convening notice of such meeting.
9.2 The general meeting of shareholders must be convened by the board of directors upon request in writing indicating the agenda, addressed to the board of directors by one or several shareholders representing at least ten percent (10%) of the Company’s share capital. In such case, the general meeting of shareholders shall be held within a period of one (1) month from the receipt of such request.
9.3 The convening notice for every general meeting of shareholders shall contain the date, time, place and agenda of the meeting and shall be made through announcements published twice, with a minimum interval of eight (8) days, and eight (8) days before the meeting, in the Mémorial C, Recueil des Sociétés et Associations and in a Luxembourg newspaper. Notices by mail shall be sent eight (8) days before the meeting to the registered shareholders, but no proof that this formality has been complied with needs to be given. Where all the shares are in registered form, the convening notices may be made by registered letters only and shall be dispatched to each shareholder by registered mail at least eight (8) days before the date scheduled for the meeting.
9.4 In the event the common shares of the Company are listed on a foreign stock exchange, any general meeting of shareholders shall be convened in accordance with the requirements of such foreign stock exchange applicable to the Company.
9.5 In the event the common shares of the Company are not listed on any foreign stock exchange, all shareholders recorded in the register of shareholders on the date of the general meeting of the shareholders are entitled to be admitted to the general meeting of shareholders. If the common shares of the Company are listed on a foreign stock exchange, the board of directors may determine a date and time preceding the general meeting of shareholders as the record date for admission to the general meeting of shareholders (the “ Record Date ”), which may not be less than five (5) days before the date of the meeting. In such case, any shareholder, Holder or Depositary, as the case may be, who wishes to attend the general meeting must inform the Company thereof no later than three (3) business days prior to the date of such general meeting, in a manner to be determined by the board of directors in the convening notice. In case of common shares held through the operator of a securities settlement system with a Depositary, a shareholder wishing to attend a general meeting of shareholders should either (i) receive from such Depositary one or more Certificates regarding the number of common shares recorded in the relevant account on the Record Date or (ii) provide voting instructions in respect of their common shares to their Depositary. The Certificates should be submitted to the Company (or its agent appointed in the convening notice) no later than three (3) business days prior to the date of the relevant general meeting. Proxies and voting forms relating to such general meeting must be remitted at the same time. The board of directors may set a shorter period for the submission of the Certificates, proxies or voting forms.
 
Article 10	Conduct of general meetings of shareholders	
10.1 The annual general meeting of shareholders shall be held in Luxembourg at the registered office of the Company or at such other place in Luxembourg as may be specified in the convening notice of such meeting, on the thirty-first of May at 10 am (Central European Time). If such day is a legal or banking holiday, the annual general meeting shall be held on the next following business day. Other meetings of shareholders may be held at such place and time as may be specified in the respective convening notices.
 
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10.2 A board of the meeting shall be formed at any general meeting of shareholders, composed of a chairman, a secretary and a scrutineer, each of whom shall be appointed by the general meeting of sharesholder and who need neither be shareholders, nor members of the board of directors. The board of the meeting shall especially ensure that the meeting is held in accordance with applicable rules and, in particular, in compliance with the rules in relation to convening, majority requirements, vote tallying and representation of shareholders.
10.3 An attendance list must be kept at any general meeting of shareholders.
10.4 A shareholder (including a Depositary) may act at any general meeting of shareholders by appointing another person as his proxy in writing by a signed document transmitted by mail or by facsimile, electronic mail or any other means of communication authorized by the board of directors. One person may represent several or even all shareholders.
10.5 Shareholders taking part in a meeting of shareholders by conference call, through video conference or by any other means of communication allowing their identification and allowing that all persons taking part in the meeting hear one another on a continuous basis and allowing an effective participation of all such persons in the meeting, are deemed to be present for the computation of the quorums and votes, subject to such means of communication being made available at the place of the meeting.
10.6 Each shareholder may vote at a general meeting through a signed voting form sent by post, electronic mail, facsimile or any other means of communication authorized by the board of directors and delivered to the Company’s registered office or to the address specified in the convening notice. The shareholders may only use voting forms provided by the Company which contain at least the place, date and time of the meeting, the agenda of the meeting, the proposal submitted to the decision of the meeting, as well as for each proposal three boxes allowing the shareholder to vote in favour of, against, or abstain from voting on each proposed resolution by ticking the appropriate box.
10.7 Voting forms which, for a proposed resolution, do not show only (i) a vote in favour or (ii) a vote against the proposed resolution or (iii) an abstention are void with respect to such resolution. The Company shall only take into account voting forms received no later than three (3) business days prior to the general meeting which they relate to. The board of directors may set a shorter period for the submission of voting forms.
10.8 The board of directors may determine other terms or set conditions that must be respected by a shareholder to participate in any meeting of shareholders in the convening notice (including, but not limited to, longer notice periods).
 
Article 11	Quorum and vote	
11.1 Each common share entitles the holder thereof to one vote in any meetings of shareholders, subject to the provisions of Luxembourg law.
11.2 Except as otherwise required by the Law or these articles of association, resolutions at a general meeting of shareholders duly convened shall be adopted by a simple majority of the votes validly cast regardless of the portion of capital represented. Abstentions and nil votes shall not be taken into account for the calculation of the majority.
 
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Article 12	Amendments of the articles of association	
Except as otherwise provided herein, these articles of association may be amended by a majority of at least two thirds (2/3) of the votes validly cast at a general meeting at which a quorum of more than half (1/2) of the Company’s share capital is present or represented. If no quorum is reached in a meeting, a second meeting may be convened in accordance with the Law and these articles of association which may deliberate regardless of the quorum and at which resolutions are taken at a majority of at least two-thirds of the votes validly cast. Abstentions and nil votes shall not be taken into account.
 
Article 13	Change of nationality	
The shareholders may change the nationality of the Company only by unanimous consent.
 
Article 14	Adjournment of general meeting of shareholders	
Subject to the provisions of the Law, the board of directors may adjourn any general meeting of shareholders for four (4) weeks. The board of directors shall do so at the request of shareholders representing in the aggregate at least twenty percent (20%) of the issued share capital of the Company. In the event of an adjournment, any resolution already adopted by the general meeting of shareholders shall be cancelled.
 
Article 15	Minutes of general meetings of shareholders	
15.1 The board of any general meeting of shareholders shall draw up minutes of the meeting which shall be signed by the members of the board of the meeting as well as by any shareholder upon its request.
15.2 Any copy and excerpt of such original minutes to be produced in judicial proceedings or to be delivered to any third party, shall be certified as a true copy of the original by the notary having had custody of the original deed, in case the meeting has been recorded in a notarial deed, or shall be signed by the chairman of the board of directors or by any two of its members.
D. MANAGEMENT
 
Article 16	Composition and powers of the board of directors	
16.1 The Company shall be managed by a board of directors composed of at least three (3) but no more than fifteen (15) members. The directors of the Company shall be divided into three (3) classes as nearly equal in size as is practicable, designated Class I, Class II and Class III. Unless revoked in accordance with article 18.4 hereof, the term of office of the initial Class I directors shall expire at the first annual meeting of shareholders occurring after the date of publication of the resolution of the general meeting of shareholders taken on [***] in the Mémorial (the “ Filing Date ”), the term of office of the initial Class II directors shall expire at the second annual meeting of shareholders occurring after the Filing Date, and the term of office of the initial Class III directors shall expire at the third annual meeting of the shareholders occurring after the Filing Date. Unless revoked in accordance with article 18.4 hereof, at each annual meeting after the first annual meeting of shareholders occurring after the Filing Date, each director appointed to the class of directors expiring at such annual meeting shall be appointed to hold office until the third succeeding annual meeting and until his or her successor shall have been duly elected and qualified, or until his or her earlier death, resignation, removal or retirement. If the number of directors divided into classes as set forth herein is hereafter changed, any newly created directorship(s) or decrease in the number of directors shall be so apportioned among the classes as to make all classes as nearly equal in number as practicable.
 
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16.2 The board of directors is vested with the broadest powers to act in the name of the Company and to take any actions necessary or useful to fulfill the Company’s corporate purpose, with the exception of the powers reserved by the Law or by these articles of association to the general meeting of shareholders.
 
Article 17	Daily management	
17.1 The daily management of the Company as well as the representation of the Company in relation with such daily management may, in accordance with article 60 of the Law, be delegated to one or more directors, officers or other agents, acting individually or jointly. Their appointment, removal and powers shall be determined by a resolution of the board of directors.
17.2 The Company may also grant special powers by notarised proxy or private instrument.
 
Article 18	Appointment, removal and term of office of directors	
18.1 The directors shall be appointed by the general meeting of shareholders which shall determine their remuneration and term of office.
18.2 The term of office of a director may not exceed six (6) years and each director shall hold office until a successor is appointed. Directors may be re-appointed for successive terms.
18.3 Each director is appointed by a simple majority vote of the shares present or represented in a general meeting.
18.4 Any director may be removed from office at any time with or without cause, at a general meeting called for that purpose, by affirmative votes representing a simple majority of the votes validly cast at the meeting.
18.5 If a legal entity is appointed as director of the Company, such legal entity must designate a private individual as permanent representative who shall perform this role in the name and on behalf of the legal entity. The relevant legal entity may only remove its permanent representative if it appoints a successor at the same time. An individual may only be a permanent representative of one (1) director of the Company and may not be a director of the Company at the same time.
 
Article 19	Rules of procedure of the board of directors and board committees	
19.1 The board of directors determines its rules of conduct in a resolution and establishes such rules in writing.
19.2 The board of directors may (but shall not be obliged to unless required by law) establish one or more committees and for which it shall, if one or more of such committees are set up, appoint the members, who may be, but do not need to be, members of the board of directors (subject always, if the common shares of the Company are listed on a foreign stock exchange, to the requirements of such foreign stock exchange applicable to the Company and/or of such regulatory authority competent in relation to such listing), determine the purpose, powers and authorities as well as the procedures and such other rules as may be applicable thereto.
 
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Article 20	Vacancy in the office of a director	
In the event of a vacancy in the office of a director because of death, legal incapacity, bankruptcy, resignation or otherwise, this vacancy may be filled on a temporary basis and for a period of time not exceeding the initial mandate of the replaced director by the remaining directors until the next general meeting of shareholders, which shall resolve on the final appointment in compliance with the applicable legal provisions.
 
Article 21	Convening meetings of the board of directors	
21.1 The board of directors shall meet upon call by the chairman, or by any director. Meetings of the board of directors shall be held at the registered office of the Company unless otherwise indicated in the notice of meeting.
21.2 Written notice of any meeting of the board of directors must be given to directors at least twenty-four (24) hours in advance of the time scheduled for the meeting, except in case of emergency, in which case the nature and the reasons of such emergency must be mentioned in the notice. Such notice may be omitted in case of assent of each director in writing, by facsimile, electronic mail or any other similar means of communication, a copy of such signed document being sufficient proof thereof. No prior notice shall be required for a board meeting to be held at a time and location determined in a prior resolution adopted by the board of directors which has been communicated to all directors.
21.3 No prior notice shall be required in case all the members of the board of directors are present or represented at a board meeting and waive any convening requirement or in the case of resolutions in writing approved and signed by all members of the board of directors.
 
Article 22	Conduct of meetings of the board of directors	
22.1 The board of directors shall elect among its members a chairman. It may also choose a secretary who does not need to be a director and who shall be responsible for keeping the minutes of the meetings of the board of directors.
22.2 The chairman shall chair all meetings of the board of directors, but in his absence, the board of directors may appoint another director as chairman pro tempore by vote of the majority of directors present at any such meeting.
22.3 Any director may act at any meeting of the board of directors by appointing another director as his proxy in writing, or by facsimile, electronic mail or any other similar means of communication, a copy of the appointment being sufficient proof thereof. A director may represent one or more, but not all of the other directors.
22.4 Meetings of the board of directors may also be held by conference call or video conference or by any other means of communication allowing all persons participating at such meeting to hear one another on a continuous basis and allowing an effective participation in the meeting. The participation in a meeting by these means shall be equivalent to a participation in person at such meeting and the meeting is deemed to be held at the registered office of the Company.
22.5 The board of directors can deliberate or act validly only if at least a majority of the directors are present or represented at a meeting of the board of directors.
22.6 Decisions shall be taken by a majority vote of the directors present or represented at such meeting. In the case of a tie, the chairman shall not have a casting vote.
 
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22.7 Save as otherwise provided by the Law, any director who has, directly or indirectly, an interest in a transaction submitted to the approval of the board of directors which conflicts with the Company’s interest, must inform the board of directors of such conflict of interest and must have his declaration recorded in the minutes of the board meeting. The relevant director may not take part in the discussions on and may not vote on the relevant transaction. Any such conflict of interest must be reported to the next general meeting of shareholders prior to such meeting taking any resolution on any other item.
22.9 The foregoing conflict of interest rules shall not apply where the decision of the board of directors relates to current operations entered into under normal conditions.
22.10 The board of directors may, unanimously, pass resolutions by circular means when expressing its approval in writing, by facsimile, electronic mail or any other similar means of communication. Each director may express his consent separately, the entirety of the consents evidencing the adoption of the resolutions. The date of such resolutions shall be the date of the last signature.
 
Article 23	Minutes of the meeting of the board of directors	
23.1 The minutes of any meeting of the board of directors shall be signed by the chairman or, in his absence, by the chairman pro tempore , or by any two (2) directors. Copies or excerpts of such minutes which may be produced in judicial proceedings or otherwise shall be signed by the chairman or by any two (2) directors.
 
Article 24	Dealing with third parties	
24.1 The Company shall be bound towards third parties in all circumstances by (i) the joint signature of any two (2) directors or by (ii) the joint signatures or the sole signature of any person(s) to whom such power may have been delegated by the board of directors within the limits of such delegation.
24.2 With respect to matters that constitute the daily management of the Company, the Company shall be bound towards third parties by the signature of any person(s) to whom such power may have been delegated, acting individually or jointly in accordance within the limits of such delegation.
 
Article 25.	Indemnification	
25.1 The members of the board of directors are not held personally liable for the indebtedness or other obligations of the Company. As agents of the Company, they are responsible for the performance of their duties. Subject to mandatory provisions of law, every person who is, or has been, a member of the board of directors or officer of the Company shall be indemnified by the Company to the fullest extent permitted by law against liability and against all expenses reasonably incurred or paid by him in connection with any claim, action, suit or proceeding which he becomes involved as a party or otherwise by virtue of his being or having been such a director or officer and against amounts paid or incurred by him in the settlement thereof. The words “claim”, “action”, “suit” or “proceeding” shall apply to all claims, actions, suits or proceedings (civil, criminal or otherwise including appeals) actual or threatened and the words “liability” and “expenses” shall include without limitation attorneys’ fees, costs, judgments, amounts paid in settlement and other liabilities.
25.2 No indemnification shall be provided to any director or officer (i) against any liability to the Company or its shareholders by reason of willful misconduct, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of his office (ii) with respect to any matter as to which he shall have been finally adjudicated to have acted in bad faith and not in the interest of the Company or (iii) in the event of a settlement, unless the settlement has been approved by a court of competent jurisdiction or by the board of directors.
 
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25.3 The right of indemnification herein provided shall be severable, shall not affect any other rights to which any director or officer may now or hereafter be entitled, shall continue as to a person who has ceased to be such director or officer and shall inure to the benefit of the heirs, executors and administrators of such a person. Nothing contained herein shall affect or limit any rights to indemnification to which corporate personnel, including directors and officers, may be entitled by contract or otherwise under law. The Company shall specifically be entitled to provide contractual indemnification to any corporate personnel, including directors and officers of the Company, as the Company may decide upon from time to time.
25.4 Expenses in connection with the preparation and representation of a defense of any claim, action, suit or proceeding of the character described in this article 15 shall be advanced by the Company prior to final disposition thereof upon receipt of any undertaking by or on behalf of the officer or director, to repay such amount if it is ultimately determined that he is not entitled to indemnification under this article.
 
Article 26.	Conflicts of interest	
26.1 To the extent required by law, any director who has, directly or indirectly a personal interest in a transaction submitted to the approval of the board of directors which conflicts with the Company’s interests, such director must inform the board of directors of such conflict of interest and must have his declaration recorded in the minutes of the board meeting. The relevant director may not take part in the discussions on and may not vote on the relevant transaction.
26.2 No contract or other transaction between the Company and any other company or firm shall be affected or invalidated by the fact that a director has a personal interested in, or is a director, associate, officer, agent, adviser or employee of such other company or firm. Any director or officer who serves as a director, officer or employee or otherwise of any company or firm with which the Company shall contract or otherwise engage in business shall not, by reason of such affiliation with such other company or firm only, be prevented from considering and voting or acting upon any matters with respect to such contract or other business.
E. AUDIT AND SUPERVISION
 
Article 27	Auditor(s)	
27.1 The Company’s annual accounts shall be audited by one or more approved independent auditors ( réviseurs d’entreprises agréés ) appointed by the general meeting of shareholders only).
The general meeting of shareholders shall determine the number of auditor(s) and the term of their office which shall not exceed one (1) year and may be renewed for successive one (1) year periods.
27.2. An independent auditor may only be removed by the general meeting of shareholders. An auditor may be reappointed.
F. FINANCIAL YEAR – ANNUAL ACCOUNTS – ALLOCATION OF PROFITS – INTERIM DIVIDENDS
 
Article 28	Financial year	
The financial year of the Company shall begin on the first of January of each year and shall end on the thirty-first of December of the same year.
 
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Article 29	Annual accounts and allocation of profits	
29.1 At the end of each financial year, the accounts are closed and the board of directors draws up an inventory of the Company’s assets and liabilities, the balance sheet and the profit and loss accounts in accordance with the law.
29.2. From the annual net profits of the Company, five per cent (5%) at least shall be allocated to the legal reserve. This allocation shall cease to be mandatory as soon and as long as the aggregate amount of such reserve amounts to ten per cent (10%) of the share capital of the Company.
29.3 Sums contributed to a reserve of the Company by a shareholder may also be allocated to the legal reserve if the contributing shareholder agrees with such allocation.
29.4 In case of a share capital reduction, the Company’s legal reserve may be reduced in proportion so that it does not exceed ten per cent (10%) of the share capital.
29.5 Upon recommendation of the board of directors, the general meeting of shareholders shall determine how the remainder of the Company’s annual net profits shall be used in accordance with the Law and these articles of association.
29.6 Dividends which have not been claimed within five (5) years after the date on which they became due and payable revert back to the Company.
 
Article 30	Interim dividends - Share premium and assimilated premiums	
30.1 The board of directors may declare and pay interim dividends subject to the provisions of the Law.
30.2 Any share premium, additional premium or other distributable reserve may be freely distributed to the shareholders subject to the provisions of the Law and these articles of association.
G. LIQUIDATION
 
Article 31	Liquidation	
31.1 In the event of dissolution of the Company in accordance with article 3.2 of these articles of association, the liquidation shall be carried out by one or several liquidators, which may be individuals or legal entities, who are appointed by the general meeting of shareholders deciding such dissolution and which shall determine the liquidator’s/liquidators’ powers and their compensation. Unless otherwise provided, the liquidators shall have the most extensive powers for the realisation of the assets and payment of the liabilities of the Company.
31.2 The surplus resulting from the realisation of the assets and the payment of the liabilities shall be distributed among the shareholders in proportion to the number of shares of the Company held by them.
H. FINAL CLAUSE - GOVERNING LAW
 
Article 32	Governing law	
All matters not governed by these articles of association shall be determined in accordance with the Law.
 
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Exhibit 5.1
To the board of directors and sole shareholder of the Company
Luxembourg, 12 September 2014
PB/SBD/FAK – 56608.11218350v5
Atento S.A. – F-1 Registration Statement – Validity of Shares
Ladies and Gentlemen,
We are acting as Luxembourg counsel for Atento S.A., a société anonyme incorporated and existing under the laws of the Grand Duchy of Luxembourg, having its registered office at 4, rue Lou Hemmer, L-1748 Luxembourg and being registered with the Luxembourg Trade and Companies’ Register under number B 185.761 (the “ Company ”) in connection with the Registration Statement on Form F-1 (the “ Registration Statement ”) filed with the U.S. Securities and Exchange Commission under the U.S. Securities Act of 1933, as amended, relating to to the issue and offering of 4,049,558 common shares of the Company without nominal value (the “ Offered Shares ”).
We have assumed for the purposes hereof, that, (i) the issue of the Offered Shares will be conditional upon the due and valid passing of the resolutions of the EGM and the Board Resolutions and (ii) the passing of the resolutions of the EGM and the Board Resolutions will have no retroactive effect and (iii) prior to the delivery and settlement of the Offered Shares, the resolutions of the EGM and the Board Resolutions will be duly and validly passed and will be in full force and effect and the conditions for the effectiveness of these resolutions will be fulfilled in accordance with applicable law.
We have reviewed, and relied on, (i) the consolidated articles of association of the Company as at 28 April 2014, (ii) draft resolutions to be adopted by the sole shareholder of the Company at an extraordinary general meeting (the “ EGM ”) approving inter alia , the creation of an authorized share capital (iii) draft consolidated articles of association of the Company reflecting the changes to be approved by the EGM (the “ Restated Articles of Association ”), (iv) draft resolutions to be adopted by the board of directors of the Company (the “ Board Resolutions ”) approving inter alia the issuance of the Offered Shares, that have been disclosed to us and such certifications made to us, which we deemed necessary and appropriate as a basis for the opinions hereinafter expressed.

We express no opinion as to any laws other than the laws of the Grand Duchy of Luxembourg and this opinion is to be construed under Luxembourg law and is subject to the exclusive jurisdiction of the courts of Luxembourg.
Based on the foregoing, and having regard for such legal considerations as we have deemed relevant, we are of the opinion that:
1. The Company is validly existing as a société anonyme under the laws of the Grand Duchy of Luxembourg.
2. Subject to the due and valid passing of the EGM, the publication in the Mémorial C, Recueil des Sociétés et Associations of the minutes of the EGM, the valid passing of the Board Resolutions and the fulfilment of the conditions precedent set out in such resolutions, the Offered Shares will be validly issued, fully paid and non-assessable (within the meaning that the holder of such shares shall not be liable, solely because of his or her or its shareholder status, for additional payments to the Company or the Company’s creditors).
We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to use of our name under the heading “Validity of Common Shares” and “Certain Taxation Considerations” as regards the Grand Duchy of Luxembourg in the prospectus contained therein. In giving such consent we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the U.S. Securities Act of 1933, as amended.
This Opinion is issued by and signed on behalf of Arendt & Medernach SA, admitted to practice in the Grand-Duchy of Luxembourg and registered on the list V of the Luxembourg Bar.
Yours faithfully,
Arendt & Medernach SA
 
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Exhibit 10.10
Atento S.A.
Société anonyme
Registered office: 4, rue Lou Hemmer,
L-1748 Luxembourg
RCS Luxembourg: B 185761

2014 OMNIBUS INCENTIVE PLAN

ARTICLE I
PURPOSE
The purpose of this Atento S.A. 2014 Omnibus Incentive Plan is to enhance the profitability and value of the Company for the benefit of its shareholders by enabling the Company to offer Eligible Individuals cash and share-based incentives in order to attract, retain and reward such individuals and strengthen the mutuality of interests between such individuals and the Company’s shareholders. The Plan is effective as of the date set forth in Article XV.
ARTICLE II
DEFINITIONS
For purposes of the Plan, the following terms shall have the following meanings:
2.1 “ Affiliate ” means each of the following: (a) any Subsidiary; (b) any Parent; (c) any company, trade or business (including, without limitation, a partnership or limited liability company) which is directly or indirectly controlled 50% or more (whether by ownership of shares, assets or an equivalent ownership interest or voting interest) by the Company or one of its Affiliates; (d) any trade or business (including, without limitation, a partnership or limited liability company) which directly or indirectly controls 50% or more (whether by ownership of shares, assets or an equivalent ownership interest or voting interest) of the Company; and (e) any other entity in which the Company or any of its Affiliates has a material equity interest and which is designated as an “Affiliate” by resolution of the Board; provided that, unless otherwise determined by the Board, the Common Stock subject to any Award constitutes “service recipient stock” for purposes of Section 409A of the Code or otherwise does not subject the Award to Section 409A of the Code.
2.2 “ Award ” means any award under the Plan of any Stock Option, Stock Appreciation Right, Restricted Stock Award, Performance Award, Other Stock-Based Award or Other Cash-Based Award. All Awards shall be granted by, confirmed by, and subject to the terms of, a written agreement executed by the Company and the Participant.
2.3 “ Award Agreement ” means the written or electronic agreement setting forth the terms and conditions applicable to an Award.

2.4 “ Board ” means the Board of Directors of the Company.
2.5 “ Cause ” means, unless otherwise determined by the Board in the applicable Award Agreement, with respect to a Participant’s Termination of Employment or Termination of Consultancy, the following: (a) in the case where there is no employment agreement, consulting agreement, change in control agreement or similar agreement in effect between the Company or an Affiliate and the Participant at the time of the grant of the Award (or where there is such an agreement but it does not define “cause” (or words of like import)), termination due to a Participant’s insubordination, dishonesty, fraud, incompetence, moral turpitude, willful misconduct, refusal to perform the Participant’s duties or responsibilities for any reason other than illness or incapacity or materially unsatisfactory performance of the Participant’s duties for the Company or an Affiliate, as determined by the Board in its good faith discretion; or (b) in the case where there is an employment agreement, consulting agreement, change in control agreement or similar agreement in effect between the Company or an Affiliate and the Participant at the time of the grant of the Award that defines “cause” (or words of like import), “cause” as defined under such agreement; provided, however, that with regard to any agreement under which the definition of “cause” only applies on occurrence of a change in control, such definition of “cause” shall not apply until a change in control actually takes place and then only with regard to a termination thereafter. With respect to a Participant’s Termination of Directorship, “cause” means an act or failure to act that constitutes cause for removal of a director under applicable Delaware law.
2.6 “ Change in Control ” has the meaning set forth in 11.2.
2.7 “ Change in Control Price ” has the meaning set forth in Section 11.1.
2.8 “ Code ” means the Internal Revenue Code of 1986, as amended. Any reference to any section of the Code shall also be a reference to any successor provision and any treasury regulation promulgated thereunder.
2.9 “ Common Stock ” means the ordinary shares of the Company.
2.10 “ Company ” means Atento S.A. and its successors by operation of law.
2.11 “ Consultant ” means any natural person who is an advisor or consultant to the Company or its Affiliates.
2.12 “ Disability ” means, unless otherwise determined by the Board in the applicable Award Agreement, with respect to a Participant’s Termination, a permanent and total disability as defined in Section 22(e)(3) of the Code. A Disability shall only be deemed to occur at the time of the determination by the Board of the Disability. Notwithstanding the foregoing, for Awards that are subject to Section 409A of the Code, Disability shall mean that a Participant is disabled under Section 409A(a)(2)(C)(i) or (ii) of the Code.
2.13 “ Effective Date ” means the effective date of the Plan as defined in Article XV.
2.14 “ Eligible Employees ” means each employee of the Company or an Affiliate.
 
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2.15 “ Eligible Individual ” means an Eligible Employee, Non-Employee Director or Consultant who is designated by the Board in its discretion as eligible to receive Awards subject to the conditions set forth herein.
2.16 “ Exchange Act ” means the Securities Exchange Act of 1934, as amended. Reference to a specific section of the Exchange Act or regulation thereunder shall include such section or regulation, any valid regulation or interpretation promulgated under such section, and any comparable provision of any future legislation or regulation amending, supplementing or superseding such section or regulation.
2.17 “ Fair Market Value ” means, for purposes of the Plan, unless otherwise provided in an Award Agreement or required by any applicable provision of the Code or any regulations issued thereunder, as of any date and except as provided below, the last sales price reported for the Common Stock on the applicable date: (a) as reported on the principal national securities exchange in the United States on which it is then traded or (b) if the Common Stock is not traded, listed or otherwise reported or quoted, the Board shall determine in good faith the Fair Market Value in whatever manner it considers appropriate taking into account the requirements of Section 409A of the Code. For purposes of the grant of any Award, the applicable date shall be the trading day immediately prior to the date on which the Award is granted.
2.18 “ Family Member ” means “family member” as defined in Section A.1.(a)(5) of the general instructions of Form S-8.
2.19 “ Incentive Stock Option ” means any Stock Option awarded to an Eligible Employee of the Company, its Subsidiaries and its Parents (if any) under the Plan intended to be and designated as an “Incentive Stock Option” within the meaning of Section 422 of the Code.
2.20 “ Lead Underwriter ” has the meaning set forth in Section 14.20.
2.21 “ Lock-Up Period ” has the meaning set forth in Section 14.20.
2.22 “ Non-Employee Director ” means a director or a member of the Board of the Company or any Affiliate who is not an active employee of the Company or any Affiliate.
2.23 “ Non-Qualified Stock Option ” means any Stock Option awarded under the Plan that is not an Incentive Stock Option.
2.24 “ Non-Tandem Stock Appreciation Right ” shall mean the right to receive an amount in cash and/or shares equal to the difference between (x) the Fair Market Value of a share of Common Stock on the date such right is exercised, and (y) the aggregate exercise price of such right, otherwise than on surrender of a Stock Option.
2.25 “ Other Cash-Based Award ” means an Award granted pursuant to Section 10.3 of the Plan and payable in cash at such time or times and subject to such terms and conditions as determined by the Board in its sole discretion.
2.26 “ Other Extraordinary Event ” has the meaning set forth in Section 4.2(b).
 
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2.27 “ Other Stock-Based Award ” means an Award under Article X of the Plan that is valued in whole or in part by reference to, or is payable in or otherwise based on, Common Stock, including, without limitation, an Award valued by reference to an Affiliate.
2.28 “ Parent ” means any parent company of the Company within the meaning of Section 424(e) of the Code.
2.29 “ Participant ” means an Eligible Individual to whom an Award has been granted pursuant to the Plan.
2.30 “ Performance Award ” means an Award granted to a Participant pursuant to Article IX hereof contingent upon achieving certain Performance Goals.
2.31 “ Performance Goals ” means goals established by the Board as contingencies for Awards to vest and/or become exercisable or distributable based on one or more of the performance goals set forth in Exhibit A hereto.
2.32 “ Performance Period ” means the designated period during which the Performance Goals must be satisfied with respect to the Award to which the Performance Goals relate.
2.33 “ Plan ” means this Atento S.A. 2014 Omnibus Incentive Plan, as amended from time to time.
2.34 “ Proceeding ” has the meaning set forth in Section 14.9.
2.35 “ Reference Stock Option ” has the meaning set forth in Section 7.1.
2.36 “ Registration Date ” means the date on which the Company sells its Common Stock in a bona fide, firm commitment underwriting pursuant to a registration statement under the Securities Act.
2.37 “ Restricted Stock ” means an Award of shares of Common Stock under the Plan that is subject to restrictions under Article VIII.
2.38 “ Restriction Period ” has the meaning set forth in Section 8.3(a) with respect to Restricted Stock.
2.39 “ Rule 16b-3 ” means Rule 16b-3 under Section 16(b) of the Exchange Act as then in effect or any successor provision.
2.40 “ Section 4.2 Event ” has the meaning set forth in Section 4.2(b).
2.41 “ Section 162(m) of the Code ” means the exception for performance-based compensation under Section 162(m) of the Code and any applicable treasury regulations thereunder.
 
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2.42 “ Section 409A of the Code ” means the nonqualified deferred compensation rules under Section 409A of the Code and any applicable treasury regulations and other official guidance thereunder.
2.43 “ Securities Act ” means the Securities Act of 1933, as amended and all rules and regulations promulgated thereunder. Reference to a specific section of the Securities Act or regulation thereunder shall include such section or regulation, any valid regulation or interpretation promulgated under such section, and any comparable provision of any future legislation or regulation amending, supplementing or superseding such section or regulation.
2.44 “ Stock Appreciation Right ” shall mean the right pursuant to an Award granted under Article VII.
2.45 “ Stock Option ” or “ Option ” means any option to purchase shares of Common Stock granted to Eligible Individuals granted pursuant to Article VI.
2.46 “ Subsidiary ” means any subsidiary company of the Company within the meaning of Section 424(f) of the Code.
2.47 “ Tandem Stock Appreciation Right ” shall mean the right to surrender to the Company all (or a portion) of a Stock Option in exchange for an amount in cash and/or share equal to the difference between (i) the Fair Market Value on the date such Stock Option (or such portion thereof) is surrendered, of the Common Stock covered by such Stock Option (or such portion thereof), and (ii) the aggregate exercise price of such Stock Option (or such portion thereof).
2.48 “ Ten Percent Shareholder ” means a person owning share possessing more than ten percent (10%) of the total combined voting power of all classes of shares of the Company, its Subsidiaries or its Parent.
2.49 “ Termination ” means a Termination of Consultancy, Termination of Directorship or Termination of Employment, as applicable.
2.50 “ Termination of Consultancy ” means: (a) that the Consultant is no longer acting as a consultant to the Company or an Affiliate; or (b) when an entity which is retaining a Participant as a Consultant ceases to be an Affiliate unless the Participant otherwise is, or thereupon becomes, a Consultant to the Company or another Affiliate at the time the entity ceases to be an Affiliate. In the event that a Consultant becomes an Eligible Employee or a Non-Employee Director upon the termination of such Consultant’s consultancy, unless otherwise determined by the Board, in its sole discretion, no Termination of Consultancy shall be deemed to occur until such time as such Consultant is no longer a Consultant, an Eligible Employee or a Non-Employee Director. Notwithstanding the foregoing, the Board may otherwise define Termination of Consultancy in the Award Agreement or, if no rights of a Participant are reduced, may otherwise define Termination of Consultancy thereafter, provided that any such change to the definition of the term “Termination of Consultancy” does not subject the applicable Award to Section 409A of the Code.
 
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2.51 “ Termination of Directorship ” means that the Non-Employee Director has ceased to be a director of the Company; except that if a Non-Employee Director becomes an Eligible Employee or a Consultant upon the termination of such Non-Employee Director’s directorship, such Non-Employee Director’s ceasing to be a director of the Company shall not be treated as a Termination of Directorship unless and until the Participant has a Termination of Employment or Termination of Consultancy, as the case may be.
2.52 “ Termination of Employment ” means: (a) a termination of employment (for reasons other than a military or personal leave of absence granted by the Company) of a Participant from the Company and its Affiliates; or (b) when an entity which is employing a Participant ceases to be an Affiliate, unless the Participant otherwise is, or thereupon becomes, employed by the Company or another Affiliate at the time the entity ceases to be an Affiliate. In the event that an Eligible Employee becomes a Consultant or a Non-Employee Director upon the termination of such Eligible Employee’s employment, unless otherwise determined by the Board, in its sole discretion, no Termination of Employment shall be deemed to occur until such time as such Eligible Employee is no longer an Eligible Employee, a Consultant or a Non-Employee Director. Notwithstanding the foregoing, the Board may otherwise define Termination of Employment in the Award Agreement or, if no rights of a Participant are reduced, may otherwise define Termination of Employment thereafter, provided that any such change to the definition of the term “Termination of Employment” does not subject the applicable Award to Section 409A of the Code.
2.53 “ Transfer ” means: (a) when used as a noun, any direct or indirect transfer, sale, assignment, pledge, hypothecation, encumbrance or other disposition (including the issuance of equity in any entity), whether for value or no value and whether voluntary or involuntary (including by operation of law), and (b) when used as a verb, to directly or indirectly transfer, sell, assign, pledge, encumber, charge, hypothecate or otherwise dispose of (including the issuance of equity in any entity) whether for value or for no value and whether voluntarily or involuntarily (including by operation of law). “Transferred” and “Transferable” shall have a correlative meaning.
2.54 “ Transition Period ” means the period beginning with the Registration Date and ending as of the earlier of: (i) the date of the first annual meeting of sharesholders of the Company at which directors are to be elected that occurs after the close of the third calendar year following the calendar year in which the Registration Date occurs; and (ii) the expiration of the “reliance period” under Treasury Regulation Section 1.162-27(f)(2).
ARTICLE III
ADMINISTRATION
3.1 The Board . The Plan shall be administered and interpreted by the Board. To the extent required by applicable law, rule or regulation, it is intended that each member of the Board shall qualify as (a) a “non-employee director” under Rule 16b-3, (b) an “outside director” under Section 162(m) of the Code and (c) an “independent director” under the rules of any national securities exchange or national securities association, as applicable. If it is later determined that one or more members of the Board do not so qualify, actions taken by the Board prior to such determination shall be valid despite such failure to qualify.
 
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3.2 Grants of Awards . The Board shall have full authority to grant, pursuant to the terms of the Plan, to Eligible Individuals: (i) Stock Options, (ii) Stock Appreciation Rights, (iii) Restricted Stock Awards, (iv) Performance Awards; (v) Other Stock-Based Awards; and (vi) Other Cash-Based Awards. In particular, the Board shall have the authority:
(a) to select the Eligible Individuals to whom Awards may from time to time be granted hereunder;
(b) to determine whether and to what extent Awards, or any combination thereof, are to be granted hereunder to one or more Eligible Individuals;
(c) to determine the number of shares of Common Stock to be covered by each Award granted hereunder;
(d) to determine the terms and conditions, not inconsistent with the terms of the Plan, of any Award granted hereunder (including, but not limited to, the exercise or purchase price (if any), any restriction or limitation, any vesting schedule or acceleration thereof, or any forfeiture restrictions or waiver thereof, regarding any Award and the shares of Common Stock relating thereto, based on such factors, if any, as the Board shall determine, in its sole discretion);
(e) to determine the amount of cash to be covered by each Award granted hereunder;
(f) to determine whether, to what extent and under what circumstances grants of Options and other Awards under the Plan are to operate on a tandem basis and/or in conjunction with or apart from other awards made by the Company outside of the Plan;
(g) to determine whether and under what circumstances a Stock Option may be settled in cash, Common Stock and/or Restricted Stock under Section 6.4(d);
(h) to determine whether a Stock Option is an Incentive Stock Option or Non-Qualified Stock Option;
(i) to determine whether to require a Participant, as a condition of the granting of any Award, to not sell or otherwise dispose of shares acquired pursuant to the exercise of an Award for a period of time as determined by the Board, in its sole discretion, following the date of the acquisition of such Award;
(j) to modify, extend or renew an Award, subject to Article XII and Section 6.4(l), provided, however, that such action does not subject the Award to Section 409A of the Code without the consent of the Participant; and
(k) solely to the extent permitted by applicable law, to determine whether, to what extent and under what circumstances to provide loans (which may be on a recourse basis and shall bear interest at the rate the Board shall provide) to Participants in order to exercise Options under the Plan.
 
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3.3 Guidelines . Subject to Article XII hereof, the Board shall have the authority to adopt, alter and repeal such administrative rules, guidelines and practices governing the Plan and perform all acts, including the delegation of its responsibilities (to the extent permitted by applicable law and applicable shares exchange rules), as it shall, from time to time, deem advisable; to construe and interpret the terms and provisions of the Plan and any Award issued under the Plan (and any agreements relating thereto); and to otherwise supervise the administration of the Plan. The Board may correct any defect, supply any omission or reconcile any inconsistency in the Plan or in any agreement relating thereto in the manner and to the extent it shall deem necessary to effectuate the purpose and intent of the Plan. The Board may adopt special guidelines and provisions for persons who are residing in or employed in, or subject to, the taxes of, any domestic or foreign jurisdictions to comply with applicable tax and securities laws of such domestic or foreign jurisdictions. Notwithstanding the foregoing, no action of the Board under this Section 3.3 shall impair the rights of any Participant without the Participant’s consent. To the extent applicable, the Plan is intended to comply with the applicable requirements of Rule 16b-3, and with respect to Awards intended to be “performance-based,” the applicable provisions of Section 162(m) of the Code, and the Plan shall be limited, construed and interpreted in a manner so as to comply therewith.
3.4 Decisions Final . Any decision, interpretation or other action made or taken in good faith by or at the direction of the Company, the Board or the Board (or any of its members) arising out of or in connection with the Plan shall be within the absolute discretion of all and each of them, as the case may be, and shall be final, binding and conclusive on the Company and all employees and Participants and their respective heirs, executors, administrators, successors and assigns.
3.5 Procedures . The Board shall hold meetings, subject to the articles of association of the Company, at such times and places as it shall deem advisable, including, without limitation, by telephone conference or by written consent to the extent permitted by applicable law. A majority of the Board members shall constitute a quorum. All determinations of the Board shall be made by a majority of its members. Any decision or determination reduced to writing and signed by all of the Board members in accordance with the articles of association of the Company, shall be fully effective as if it had been made by a vote at a meeting duly called and held. The Board shall keep minutes of its meetings and shall make such rules and regulations for the conduct of its business as it shall deem advisable.
3.6 Designation of Consultants/Liability .
(a) The Board may designate employees of the Company and professional advisors to assist the Board in the administration of the Plan and (to the extent permitted by applicable law and applicable exchange rules) may grant authority to officers to grant Awards and/or execute agreements or other documents on behalf of the Board.
(b) The Board may employ such legal counsel, consultants and agents as it may deem desirable for the administration of the Plan and may rely upon any opinion received from any such counsel or consultant and any computation received from any such consultant or agent. Expenses incurred by the Board or the Board in the engagement of any such counsel, consultant or agent shall be paid by the Company. The Board, its members and any person designated pursuant
 
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to sub-section (a) above shall not be liable for any action or determination made in good faith with respect to the Plan. To the maximum extent permitted by applicable law, no officer of the Company or member or former member of the Board or of the Board shall be liable for any action or determination made in good faith with respect to the Plan or any Award granted under it.
3.7 Indemnification . To the maximum extent permitted by applicable law and articles of association of the Company and to the extent not covered by insurance directly insuring such person, each officer or employee of the Company or any Affiliate and member or former member of the Board or the Board shall be indemnified and held harmless by the Company against any cost or expense (including reasonable fees of counsel reasonably acceptable to the Board) or liability (including any sum paid in settlement of a claim with the approval of the Board), and advanced amounts necessary to pay the foregoing at the earliest time and to the fullest extent permitted, arising out of any act or omission to act in connection with the administration of the Plan, except to the extent arising out of such officer’s, employee’s, member’s or former member’s own fraud or bad faith. Such indemnification shall be in addition to any right of indemnification the employees, officers, directors or members or former officers, directors or members may have under applicable law or under the articles of association of the Company or any Affiliate. Notwithstanding anything else herein, this indemnification will not apply to the actions or determinations made by an individual with regard to Awards granted to such individual under the Plan.
ARTICLE IV
SHARE LIMITATION
4.1 Shares . (a) The aggregate number of shares of Common Stock that may be issued or used for reference purposes or with respect to which Awards may be granted under the Plan shall not exceed 1,100,000 shares (subject to any increase or decrease pursuant to Section 4.2) (the “ Share Reserve ”), which may be either authorized and unissued Common Stock or Common Stock held in or acquired for the treasury of the Company or both. The maximum number of shares of Common Stock with respect to which Incentive Stock Options may be granted under the Plan shall be 1,100,000 shares. With respect to Stock Appreciation Rights settled in Common Stock, upon settlement, only the number of shares of Common Stock delivered to a Participant (based on the difference between the Fair Market Value of the shares of Common Stock subject to such Stock Appreciation Right on the date such Stock Appreciation Right is exercised and the exercise price of each Stock Appreciation Right on the date such Stock Appreciation Right was awarded) shall count against the aggregate and individual share limitations set forth under Sections 4.1(a) and 4.1(b). If any Option, Stock Appreciation Right or Other Stock-Based Awards granted under the Plan expires, terminates or is canceled for any reason without having been exercised in full, the number of shares of Common Stock underlying any unexercised Award shall again be available for the purpose of Awards under the Plan. If any shares of Restricted Stock, Performance Awards or Other Stock-Based Awards denominated in shares of Common Stock awarded under the Plan to a Participant are forfeited for any reason, the number of forfeited shares of Restricted Stock, Performance Awards or Other Stock-Based Awards denominated in shares of Common Stock shall again be available for purposes of Awards under the Plan. If a Tandem Stock Appreciation Right or a Limited Stock Appreciation Right is granted in tandem with an Option, such grant shall only apply once against the maximum number of shares of Common Stock which may be issued under the Plan. Any Award under the Plan settled in cash shall not be
 
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counted against the foregoing maximum share limitations. The maximum number of shares of Common Stock subject to any Award of Stock Options, or Stock Appreciation Rights which may be granted under the Plan during any fiscal year of the Company to any Participant shall be 160,000 shares (which shall be subject to any further increase or decrease pursuant to Section 4.2). The maximum grant date fair value of any Award granted to any director during any calendar year shall not exceed $5,000,000.
(b) Individual Participant Limitations . To the extent required by Section 162(m) of the Code for Awards under the Plan to qualify as “performance-based compensation,” the following individual Participant limitations shall only apply after the expiration of the Transition Period:
(i) The maximum number of shares of Common Stock subject to any Award of Stock Options, or Stock Appreciation Rights, or shares of Restricted Stock, or Other Stock-Based Awards for which the grant of such Award or the lapse of the relevant Restriction Period is subject to the attainment of Performance Goals in accordance with Section 8.3(a)(ii) which may be granted under the Plan during any fiscal year of the Company to any Participant shall be 160,000 shares per type of Award (which shall be subject to any further increase or decrease pursuant to Section 4.2), provided that the maximum number of shares of Common Stock for all types of Awards does not exceed 160,000 shares (which shall be subject to any further increase or decrease pursuant to Section 4.2) during any fiscal year of the Company. If a Tandem Stock Appreciation Right is granted or a Limited Stock Appreciation Right is granted in tandem with a Stock Option, it shall apply against the Participant’s individual share limitations for both Stock Appreciation Rights and Stock Options.
(ii) There are no annual individual share limitations applicable to Participants on Restricted Stock or Other Stock-Based Awards for which the grant, vesting or payment (as applicable) of any such Award is not subject to the attainment of Performance Goals.
(iii) The maximum number of shares of Common Stock subject to any Performance Award which may be granted under the Plan during any fiscal year of the Company to any Participant shall be 160,000 shares (which shall be subject to any further increase or decrease pursuant to Section 4.2) with respect to any fiscal year of the Company.
(iv) The maximum value of a cash payment made under a Performance Award which may be granted under the Plan with respect to any fiscal year of the Company to any Participant shall be $5,000,000.
(v) The individual Participant limitations set forth in this Section 4.1(b) (other than Section 4.1(b)(iii)) shall be cumulative; that is, to the extent that shares of Common Stock for which Awards are permitted to be granted to a Participant during a fiscal year are not covered by an Award to such Participant in a fiscal year, the number of shares of Common Stock available for Awards to such Participant shall automatically increase in the subsequent fiscal years during the term of the Plan until used.
 
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4.2 Changes .
(a) The existence of the Plan and the Awards granted hereunder shall not affect in any way the right or power of the Board or the shareholders of the Company to make or authorize (i) any adjustment, recapitalization, reorganization or other change in the Company’s capital structure or its business, (ii) any merger or consolidation of the Company or any Affiliate, (iii) any issuance of bonds, debentures, preferred or prior preference shares ahead of or affecting the Common Stock, (iv) the dissolution or liquidation of the Company or any Affiliate, (v) any sale or transfer of all or part of the assets or business of the Company or any Affiliate or (vi) any other corporate act or proceeding.
(b) Subject to the provisions of Section 11.1, if there shall occur any such change in the capital structure of the Company by reason of any stock split, reverse stock split, shares dividend, subdivision, combination or reclassification of shares that may be issued under the Plan, any recapitalization, any merger, any consolidation, any spin off, any reorganization or any partial or complete liquidation, or any other corporate transaction or event having an effect similar to any of the foregoing (a “ Section 4.2 Event ”), then (i) the aggregate number and/or kind of securities that thereafter may be issued under the Plan, (ii) the number and/or kind of securities or other property (including cash) to be issued upon exercise of an outstanding Award granted under the Plan (including as a result of the assumption of the Plan and the obligations hereunder by a successor entity, as applicable), and/or (iii) the purchase price thereof, shall be appropriately adjusted. In addition, subject to Section 11.1, if there shall occur any change in the capital structure or the business of the Company that is not a Section 4.2 Event (an “ Other Extraordinary Event ”), including by reason of any extraordinary dividend (whether cash or shares), any conversion, any adjustment, any issuance of any class of securities convertible or exercisable into, or exercisable for, any class of hares, or any sale or transfer of all or substantially all of the Company’s assets or business, then the Board, in its sole discretion, may adjust any Award and make such other adjustments to the Plan. Any adjustment pursuant to this Section 4.2 shall be consistent with the applicable Section 4.2 Event or the applicable Other Extraordinary Event, as the case may be, and in such manner as the Board may, in its sole discretion, deem appropriate and equitable to prevent substantial dilution or enlargement of the rights granted to, or available for, Participants under the Plan. Any such adjustment determined by the Board shall be final, binding and conclusive on the Company and all Participants and their respective heirs, executors, administrators, successors and permitted assigns. Any adjustment to, or assumption or substitution of, an Award under this Section 4.2(b) shall be intended to comply with the requirements of Section 409A of the Code and Treasury Regulation §1.424-1 (and any amendments thereto), to the extent applicable. Except as expressly provided in this Section 4.2 or in the applicable Award Agreement, a Participant shall have no rights by reason of any Section 4.2 Event or any Other Extraordinary Event.
(c) Fractional shares of Common Stock resulting from any adjustment in Awards pursuant to Section 4.2(a) or 4.2(b) shall be aggregated until, and eliminated at, the time of exercise or payment by rounding-down for fractions less than one-half and rounding-up for fractions equal to or greater than one-half. No cash settlements shall be required with respect to fractional shares eliminated by rounding. Notice of any adjustment shall be given by the Board to each Participant whose Award has been adjusted and such adjustment (whether or not such notice is given) shall be effective and binding for all purposes of the Plan.
 
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4.3 Minimum Purchase Price . Notwithstanding any provision of the Plan to the contrary, if authorized but previously unissued shares of Common Stock are issued under the Plan, such shares shall not be issued for a consideration that is less than as permitted under applicable law.
ARTICLE V
ELIGIBILITY
5.1 General Eligibility . All current and prospective Eligible Individuals are eligible to be granted Awards. Eligibility for the grant of Awards and actual participation in the Plan shall be determined by the Board in its sole discretion.
5.2 Incentive Stock Options . Notwithstanding the foregoing, only Eligible Employees of the Company, its Subsidiaries and its Parent (if any) are eligible to be granted Incentive Stock Options under the Plan. Eligibility for the grant of an Incentive Stock Option and actual participation in the Plan shall be determined by the Board in its sole discretion.
5.3 General Requirement . The vesting and exercise of Awards granted to a prospective Eligible Individual are conditioned upon such individual actually becoming an Eligible Employee, Consultant or Non-Employee Director, respectively.
ARTICLE VI
STOCK OPTIONS
6.1 Options . Stock Options may be granted alone or in addition to other Awards granted under the Plan. Each Stock Option granted under the Plan shall be of one of two types: (a) an Incentive Stock Option or (b) a Non-Qualified Stock Option.
6.2 Grants . The Board shall have the authority to grant to any Eligible Employee one or more Incentive Stock Options, Non-Qualified Stock Options, or both types of Stock Options. The Board shall have the authority to grant any Consultant or Non-Employee Director one or more Non-Qualified Stock Options. To the extent that any Stock Option does not qualify as an Incentive Stock Option (whether because of its provisions or the time or manner of its exercise or otherwise), such Stock Option or the portion thereof which does not so qualify shall constitute a separate Non-Qualified Stock Option.
6.3 Incentive Stock Options . Notwithstanding anything in the Plan to the contrary, no term of the Plan relating to Incentive Stock Options shall be interpreted, amended or altered, nor shall any discretion or authority granted under the Plan be so exercised, so as to disqualify the Plan under Section 422 of the Code, or, without the consent of the Participants affected, to disqualify any Incentive Stock Option under such Section 422.
6.4 Terms of Options . Options granted under the Plan shall be subject to the following terms and conditions and shall be in such form and contain such additional terms and conditions, not inconsistent with the terms of the Plan, as the Board shall deem desirable:
(a) Exercise Price . The exercise price per share of Common Stock subject to a Stock Option shall be determined by the Board at the time of grant, provided that the per share
 
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exercise price of a Stock Option shall not be less than 100% (or, in the case of an Incentive Stock Option granted to a Ten Percent Shareholder, 110%) of the Fair Market Value of the Common Stock at the time of grant.
(b) Stock Option Term . The term of each Stock Option shall be fixed by the Board, provided that no Stock Option shall be exercisable more than 10 years after the date the Option is granted; and provided further that the term of an Incentive Stock Option granted to a Ten Percent Shareholder shall not exceed five years.
(c) Exercisability . Unless otherwise provided by the Board in accordance with the provisions of this Section 6.4, Stock Options granted under the Plan shall be exercisable at such time or times and subject to such terms and conditions as shall be determined by the Board at the time of grant. If the Board provides, in its discretion, that any Stock Option is exercisable subject to certain limitations (including, without limitation, that such Stock Option is exercisable only in installments or within certain time periods), the Board may waive such limitations on the exercisability at any time at or after the time of grant in whole or in part (including, without limitation, waiver of the installment exercise provisions or acceleration of the time at which such Stock Option may be exercised), based on such factors, if any, as the Board shall determine, in its sole discretion.
(d) Method of Exercise . Subject to whatever installment exercise and waiting period provisions apply under Section 6.4(c), to the extent vested, Stock Options may be exercised in whole or in part at any time during the Option term, by giving written notice of exercise to the Company specifying the number of shares of Common Stock to be purchased; provided , that unless otherwise provided in the applicable Award Agreement, such written notice of exercise shall be delivered to the Company on the first business day of the applicable month. Such notice shall be accompanied by payment in full of the purchase price (including, if required by applicable law, the accounting par value of the applicable Common Stock), as follows: (i) in cash or by check, bank draft or money order payable to the order of the Company; (ii) solely to the extent permitted by applicable law, if the Common Stock is traded on a national securities exchange, and the Board authorizes, through a procedure whereby the Participant delivers irrevocable instructions to a broker reasonably acceptable to the Board to deliver promptly to the Company an amount equal to the purchase price; or (iii) on such other terms and conditions as may be acceptable to the Board (including, without limitation, with the consent of the Board, having the Company withhold shares of Common Stock issuable upon exercise of the Stock Option, or by payment in full or in part in the form of Common Stock owned by the Participant, based on the Fair Market Value of the Common Stock on the payment date as determined by the Board). No shares of Common Stock shall be issued until payment therefor, as provided herein, has been made or provided for.
(e) Non-Transferability of Options . No Stock Option shall be Transferable by the Participant other than by will or by the laws of descent and distribution, and all Stock Options shall be exercisable, during the Participant’s lifetime, only by the Participant. Notwithstanding the foregoing, the Board may determine, in its sole discretion, at the time of grant or thereafter that a Non-Qualified Stock Option that is otherwise not Transferable pursuant to this Section is Transferable to a Family Member in whole or in part and in such circumstances, and under such conditions, as specified by the Board. A Non-Qualified Stock Option that is Transferred to a
 
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Family Member pursuant to the preceding sentence (i) may not be subsequently Transferred other than by will or by the laws of descent and distribution and (ii) remains subject to the terms of the Plan and the applicable Award Agreement. Any shares of Common Stock acquired upon the exercise of a Non-Qualified Stock Option by a permissible transferee of a Non-Qualified Stock Option or a permissible transferee pursuant to a Transfer after the exercise of the Non-Qualified Stock Option shall be subject to the terms of the Plan and the applicable Award Agreement.
(f) Termination by Death or Disability . Unless otherwise determined by the Board at the time of grant, or if no rights of the Participant are reduced, thereafter, if a Participant’s Termination is by reason of death or Disability, all Stock Options that are held by such Participant that are vested and exercisable at the time of the Participant’s Termination may be exercised by the Participant (or in the case of the Participant’s death, by the legal representative of the Participant’s estate) at any time within a period of one (1) year from the date of such Termination, but in no event beyond the expiration of the stated term of such Stock Options; provided, however, that, in the event of a Participant’s Termination by reason of Disability, if the Participant dies within such exercise period, all unexercised Stock Options held by such Participant shall thereafter be exercisable, to the extent to which they were exercisable at the time of death, for a period of one (1) year from the date of such death, but in no event beyond the expiration of the stated term of such Stock Options.
(g) Involuntary Termination Without Cause . Unless otherwise determined by the Board at the time of grant, or if no rights of the Participant are reduced, thereafter, if a Participant’s Termination is by involuntary termination by the Company without Cause, all Stock Options that are held by such Participant that are vested and exercisable at the time of the Participant’s Termination may be exercised by the Participant at any time within a period of ninety (90) days from the date of such Termination, but in no event beyond the expiration of the stated term of such Stock Options.
(h) Voluntary Resignation . Unless otherwise determined by the Board at the time of grant, or if no rights of the Participant are reduced, thereafter, if a Participant’s Termination is voluntary (other than a voluntary termination described in Section 6.4(i)(y) hereof), all Stock Options that are held by such Participant that are vested and exercisable at the time of the Participant’s Termination may be exercised by the Participant at any time within a period of thirty (30) days from the date of such Termination, but in no event beyond the expiration of the stated term of such Stock Options.
(i) Termination for Cause . Unless otherwise determined by the Board at the time of grant, or if no rights of the Participant are reduced, thereafter, if a Participant’s Termination (x) is for Cause or (y) is a voluntary Termination (as provided in Section 6.4(h)) after the occurrence of an event that would be grounds for a Termination for Cause, all Stock Options, whether vested or not vested, that are held by such Participant shall thereupon terminate and expire as of the date of such Termination.
(j) Unvested Stock Options . Unless otherwise determined by the Board at the time of grant, or if no rights of the Participant are reduced, thereafter, Stock Options that are not vested as of the date of a Participant’s Termination for any reason shall terminate and expire as of the date of such Termination.
 
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(k) Incentive Stock Option Limitations . To the extent that the aggregate Fair Market Value (determined as of the time of grant) of the Common Stock with respect to which Incentive Stock Options are exercisable for the first time by an Eligible Employee during any calendar year under the Plan and/or any other stock option plan of the Company, any Subsidiary or any Parent exceeds $100,000, such Options shall be treated as Non-Qualified Stock Options. In addition, if an Eligible Employee does not remain employed by the Company, any Subsidiary or any Parent at all times from the time an Incentive Stock Option is granted until three months prior to the date of exercise thereof (or such other period as required by applicable law), such Stock Option shall be treated as a Non-Qualified Stock Option. Should any provision of the Plan not be necessary in order for the Stock Options to qualify as Incentive Stock Options, or should any additional provisions be required, the Board may amend the Plan accordingly, without the necessity of obtaining the approval of the shareholders of the Company.
(l) Form, Modification, Extension and Renewal of Stock Options . Subject to the terms and conditions and within the limitations of the Plan, Stock Options shall be evidenced by such form of agreement or grant as is approved by the Board, and the Board may (i) modify, extend or renew outstanding Stock Options granted under the Plan (provided that the rights of a Participant are not reduced without such Participant’s consent and provided further that such action does not subject the Stock Options to Section 409A of the Code without the consent of the Participant), and (ii) accept the surrender of outstanding Stock Options (to the extent not theretofore exercised) and authorize the granting of new Stock Options in substitution therefor (to the extent not theretofore exercised). Notwithstanding the foregoing, an outstanding Option may not be modified to reduce the exercise price thereof nor may a new Option at a lower price be substituted for a surrendered Option (other than adjustments or substitutions in accordance with Section 4.2), unless such action is approved by the shareholders of the Company.
(m) Deferred Delivery of Common Stock . The Board may in its discretion permit Participants to defer delivery of Common Stock acquired pursuant to a Participant’s exercise of an Option in accordance with the terms and conditions established by the Board in the applicable Award Agreement, which shall be intended to comply with the requirements of Section 409A of the Code.
(n) Early Exercise . The Board may provide that a Stock Option include a provision whereby the Participant may elect at any time before the Participant’s Termination to exercise the Stock Option as to any part or all of the shares of Common Stock subject to the Stock Option prior to the full vesting of the Stock Option and such shares shall be subject to the provisions of Article VIII and be treated as Restricted Stock. Unvested shares of Common Stock so purchased may be subject to a repurchase option in favor of the Company or to any other restriction the Board determines to be appropriate.
(o) Other Terms and Conditions . The Board may include a provision in an Award Agreement providing for the automatic exercise of a Non-Qualified Stock Option on a cashless basis on the last day of the term of such Option if the Participant has failed to exercise the Non-Qualified Stock Option as of such date, with respect to which the Fair Market Value of the shares of Common Stock underlying the Non-Qualified Stock Option exceeds the exercise price of such Non-Qualified Stock Option on the date of expiration of such Option, subject to Section 14.3. Stock Options may contain such other provisions, which shall not be inconsistent with any of the terms of the Plan, as the Board shall deem appropriate.
 
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ARTICLE VII
STOCK APPRECIATION RIGHTS
7.1 Tandem Stock Appreciation Rights . Stock Appreciation Rights may be granted in conjunction with all or part of any Stock Option (a “ Reference Stock Option ”) granted under the Plan (“ Tandem Stock Appreciation Rights ”). In the case of a Non-Qualified Stock Option, such rights may be granted either at or after the time of the grant of such Reference Stock Option. In the case of an Incentive Stock Option, such rights may be granted only at the time of the grant of such Reference Stock Option.
7.2 Terms and Conditions of Tandem Stock Appreciation Rights . Tandem Stock Appreciation Rights granted hereunder shall be subject to such terms and conditions, not inconsistent with the provisions of the Plan, as shall be determined from time to time by the Board, and the following:
(a) Exercise Price . The exercise price per share of Common Stock subject to a Tandem Stock Appreciation Right shall be determined by the Board at the time of grant, provided that the per share exercise price of a Tandem Stock Appreciation Right shall not be less than 100% of the Fair Market Value of the Common Stock at the time of grant.
(b) Term . A Tandem Stock Appreciation Right or applicable portion thereof granted with respect to a Reference Stock Option shall terminate and no longer be exercisable upon the termination or exercise of the Reference Stock Option, except that, unless otherwise determined by the Board, in its sole discretion, at the time of grant, a Tandem Stock Appreciation Right granted with respect to less than the full number of shares covered by the Reference Stock Option shall not be reduced until, and then only to the extent that the exercise or termination of the Reference Stock Option causes, the number of shares covered by the Tandem Stock Appreciation Right to exceed the number of shares remaining available and unexercised under the Reference Stock Option.
(c) Exercisability . Tandem Stock Appreciation Rights shall be exercisable only at such time or times and to the extent that the Reference Stock Options to which they relate shall be exercisable in accordance with the provisions of Article VI, and shall be subject to the provisions of Section 6.4(c).
(d) Method of Exercise . A Tandem Stock Appreciation Right may be exercised by the Participant by surrendering the applicable portion of the Reference Stock Option. Upon such exercise and surrender, the Participant shall be entitled to receive an amount determined in the manner prescribed in this Section 7.2. Stock Options which have been so surrendered, in whole or in part, shall no longer be exercisable to the extent that the related Tandem Stock Appreciation Rights have been exercised.
(e) Payment . Upon the exercise of a Tandem Stock Appreciation Right, a Participant shall be entitled to receive up to, but no more than, an amount in cash and/or Common Stock (as chosen by the Board in its sole discretion) equal in value to the excess of the Fair
 
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Market Value of one share of Common Stock over the Option exercise price per share specified in the Reference Stock Option agreement multiplied by the number of shares of Common Stock in respect of which the Tandem Stock Appreciation Right shall have been exercised, with the Board having the right to determine the form of payment.
(f) Deemed Exercise of Reference Stock Option . Upon the exercise of a Tandem Stock Appreciation Right, the Reference Stock Option or part thereof to which such Stock Appreciation Right is related shall be deemed to have been exercised for the purpose of the limitation set forth in Article IV of the Plan on the number of shares of Common Stock to be issued under the Plan.
(g) Non-Transferability . Tandem Stock Appreciation Rights shall be Transferable only when and to the extent that the underlying Stock Option would be Transferable under Section 6.4(e) of the Plan.
7.3 Non-Tandem Stock Appreciation Rights . Non-Tandem Stock Appreciation Rights may also be granted without reference to any Stock Options granted under the Plan.
7.4 Terms and Conditions of Non-Tandem Stock Appreciation Rights . Non-Tandem Stock Appreciation Rights granted hereunder shall be subject to such terms and conditions, not inconsistent with the provisions of the Plan, as shall be determined from time to time by the Board, and the following:
(a) Exercise Price . The exercise price per share of Common Stock subject to a Non-Tandem Stock Appreciation Right shall be determined by the Board at the time of grant, provided that the per share exercise price of a Non-Tandem Stock Appreciation Right shall not be less than 100% of the Fair Market Value of the Common Stock at the time of grant.
(b) Term . The term of each Non-Tandem Stock Appreciation Right shall be fixed by the Board, but shall not be greater than 10 years after the date the right is granted.
(c) Exercisability . Unless otherwise provided by the Board in accordance with the provisions of this Section 7.4, Non-Tandem Stock Appreciation Rights granted under the Plan shall be exercisable at such time or times and subject to such terms and conditions as shall be determined by the Board at the time of grant. If the Board provides, in its discretion, that any such right is exercisable subject to certain limitations (including, without limitation, that it is exercisable only in installments or within certain time periods), the Board may waive such limitations on the exercisability at any time at or after grant in whole or in part (including, without limitation, waiver of the installment exercise provisions or acceleration of the time at which such right may be exercised), based on such factors, if any, as the Board shall determine, in its sole discretion.
(d) Method of Exercise . Subject to whatever installment exercise and waiting period provisions apply under Section 7.4(c), Non-Tandem Stock Appreciation Rights may be exercised in whole or in part at any time in accordance with the applicable Award Agreement, by giving written notice of exercise to the Company specifying the number of Non-Tandem Stock Appreciation Rights to be exercised.
 
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(e) Payment . Upon the exercise of a Non-Tandem Stock Appreciation Right a Participant shall be entitled to receive, for each right exercised, up to, but no more than, an amount in cash and/or Common Stock (as chosen by the Board in its sole discretion) equal in value to the excess of the Fair Market Value of one share of Common Stock on the date that the right is exercised over the Fair Market Value of one share of Common Stock on the date that the right was awarded to the Participant.
(f) Termination . Unless otherwise determined by the Board at grant or, if no rights of the Participant are reduced, thereafter, subject to the provisions of the applicable Award Agreement and the Plan, upon a Participant’s Termination for any reason, Non-Tandem Stock Appreciation Rights will remain exercisable following a Participant’s Termination on the same basis as Stock Options would be exercisable following a Participant’s Termination in accordance with the provisions of Sections 6.4(f) through 6.4(j).
(g) Non-Transferability . No Non-Tandem Stock Appreciation Rights shall be Transferable by the Participant other than by will or by the laws of descent and distribution, and all such rights shall be exercisable, during the Participant’s lifetime, only by the Participant.
7.5 Limited Stock Appreciation Rights . The Board may, in its sole discretion, grant Tandem and Non-Tandem Stock Appreciation Rights either as a general Stock Appreciation Right or as a Limited Stock Appreciation Right. Limited Stock Appreciation Rights may be exercised only upon the occurrence of a Change in Control or such other event as the Board may, in its sole discretion, designate at the time of grant or thereafter. Upon the exercise of Limited Stock Appreciation Rights, except as otherwise provided in an Award Agreement, the Participant shall receive in cash and/or Common Stock, as determined by the Board, an amount equal to the amount (i) set forth in Section 7.2(e) with respect to Tandem Stock Appreciation Rights, or (ii) set forth in Section 7.4(e) with respect to Non-Tandem Stock Appreciation Rights.
7.6 Other Terms and Conditions . The Board may include a provision in an Award Agreement providing for the automatic exercise of a Stock Appreciation Right on a cashless basis on the last day of the term of such Stock Appreciation Right if the Participant has failed to exercise the Stock Appreciation Right as of such date, with respect to which the Fair Market Value of the shares of Common Stock underlying the Stock Appreciation Right exceeds the exercise price of such Stock Appreciation Right on the date of expiration of such Stock Appreciation Right, subject to Section 14.4. Stock Appreciation Rights may contain such other provisions, which shall not be inconsistent with any of the terms of the Plan, as the Board shall deem appropriate.
ARTICLE VIII
RESTRICTED STOCK
8.1 Awards of Restricted Stock . Shares of Restricted Stock may be issued either alone or in addition to other Awards granted under the Plan. The Board shall determine the Eligible Individuals, to whom, and the time or times at which, grants of Restricted Stock shall be made, the number of shares to be awarded, the price (if any) to be paid by the Participant (subject to Section 8.2), the time or times within which such Awards may be subject to forfeiture, the vesting schedule and rights to acceleration thereof, and all other terms and conditions of the Awards.
 
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The Board may condition the grant or vesting of Restricted Stock upon the attainment of specified performance targets (including, the Performance Goals) or such other factor as the Board may determine in its sole discretion, including to comply with the requirements of Section 162(m) of the Code.
8.2 Awards . Eligible Individuals selected to receive Restricted Stock shall not have any right with respect to such Award, unless and until such Participant has delivered a fully executed copy of the agreement evidencing the Award to the Company, to the extent required by the Board, and has otherwise complied with the applicable terms and conditions of such Award. Further, such Award shall be subject to the following conditions:
(a) Purchase Price . The purchase price of Restricted Stock shall be fixed by the Board. Subject to Section 4.3, the purchase price for shares of Restricted Stock may be zero to the extent permitted by applicable law, and, to the extent not so permitted, such purchase price may not be less than the accounting par value.
(b) Acceptance . Awards of Restricted Stock must be accepted within a period of 60 days (or such shorter period as the Board may specify at grant) after the grant date, by executing a Restricted Stock agreement and by paying whatever price (if any) the Board has designated thereunder.
8.3 Restrictions and Conditions . The shares of Restricted Stock awarded pursuant to the Plan shall be subject to the following restrictions and conditions:
(a) Restriction Period . (i) The Participant shall not be permitted to Transfer shares of Restricted Stock awarded under the Plan during the period or periods set by the Board (the “ Restriction Period ”) commencing on the date of such Award, as set forth in the Restricted Stock Award Agreement and such agreement shall set forth a vesting schedule and any event that would accelerate vesting of the shares of Restricted Stock. Within these limits, based on service, attainment of Performance Goals pursuant to Section 8.3(a)(ii) and/or such other factors or criteria as the Board may determine in its sole discretion, the Board may condition the grant or provide for the lapse of such restrictions in installments in whole or in part, or may accelerate the vesting of all or any part of any Restricted Stock Award and/or waive the deferral limitations for all or any part of any Restricted Stock Award.
(ii) If the grant of shares of Restricted Stock or the lapse of restrictions is based on the attainment of Performance Goals, the Board shall establish the objective Performance Goals and the applicable vesting percentage of the Restricted Stock applicable to each Participant or class of Participants in writing prior to the beginning of the applicable fiscal year or at such later date as otherwise determined by the Board and while the outcome of the Performance Goals are substantially uncertain. Such Performance Goals may incorporate provisions for disregarding (or adjusting for) changes in accounting methods, corporate transactions (including, without limitation, dispositions and acquisitions) and other similar type events or circumstances. With regard to a Restricted Stock Award that is intended to
 
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comply with Section 162(m) of the Code, to the extent that any such provision would create impermissible discretion under Section 162(m) of the Code or otherwise violate Section 162(m) of the Code, such provision shall be of no force or effect.
(b) Rights as a Shareholder . Except as provided in Section 8.3(a) and this Section 8.3(b) or as otherwise determined by the Board in an Award Agreement, the Participant shall have, with respect to the shares of Restricted Stock, all of the rights of a holder of shares of Common Stock of the Company, including, without limitation, the right to receive dividends, the right to vote such shares and, subject to and conditioned upon the full vesting of shares of Restricted Stock, the right to tender such shares. The Board may, in its sole discretion, determine at the time of grant that the payment of dividends shall be deferred until, and conditioned upon, the expiration of the applicable Restriction Period.
(c) Termination . Unless otherwise determined by the Board at grant or, if no rights of the Participant are reduced, thereafter, subject to the applicable provisions of the Award Agreement and the Plan, upon a Participant’s Termination for any reason during the relevant Restriction Period, all Restricted Stock still subject to restriction will be forfeited in accordance with the terms and conditions established by the Board at grant or thereafter.
ARTICLE IX
PERFORMANCE AWARDS
9.1 Performance Awards . The Board may grant a Performance Award to a Participant payable upon the attainment of specific Performance Goals. The Board may grant Performance Awards that are intended to qualify as “performance-based compensation” under Section 162(m) of the Code, as well as Performance Awards that are not intended to qualify as “performance-based compensation” under Section 162(m) of the Code. If the Performance Award is payable in shares of Restricted Stock, such shares shall be transferable to the Participant only upon attainment of the relevant Performance Goal in accordance with Article VIII. If the Performance Award is payable in cash, it may be paid upon the attainment of the relevant Performance Goals either in cash or in shares of Restricted Stock (based on the then current Fair Market Value of such shares), as determined by the Board, in its sole and absolute discretion. Each Performance Award shall be evidenced by an Award Agreement in such form that is not inconsistent with the Plan and that the Board may from time to time approve. With respect to Performance Awards that are intended to qualify as “performance-based compensation” under Section 162(m) of the Code, the Board shall condition the right to payment of any Performance Award upon the attainment of objective Performance Goals established pursuant to Section 9.2(c).
9.2 Terms and Conditions . Performance Awards awarded pursuant to this Article IX shall be subject to the following terms and conditions:
(a) Earning of Performance Award . At the expiration of the applicable Performance Period, the Board shall determine the extent to which the Performance Goals established pursuant to Section 9.2(c) are achieved and the percentage of each Performance Award that has been earned.
 
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(b) Non-Transferability . Subject to the applicable provisions of the Award Agreement and the Plan, Performance Awards may not be Transferred during the Performance Period.
(c) Objective Performance Goals, Formulae or Standards . With respect to Performance Awards that are intended to qualify as “performance-based compensation” under Section 162(m) of the Code, the Board shall establish the objective Performance Goals for the earning of Performance Awards based on a Performance Period applicable to each Participant or class of Participants in writing prior to the beginning of the applicable Performance Period or at such later date as permitted under Section 162(m) of the Code and while the outcome of the Performance Goals are substantially uncertain. Such Performance Goals may incorporate, if and only to the extent permitted under Section 162(m) of the Code, provisions for disregarding (or adjusting for) changes in accounting methods, corporate transactions (including, without limitation, dispositions and acquisitions) and other similar type events or circumstances. To the extent that any such provision would create impermissible discretion under Section 162(m) of the Code or otherwise violate Section 162(m) of the Code, such provision shall be of no force or effect, with respect to Performance Awards that are intended to qualify as “performance-based compensation” under Section 162(m) of the Code.
(d) Dividends . Unless otherwise determined by the Board at the time of grant, amounts equal to dividends declared during the Performance Period with respect to the number of shares of Common Stock covered by a Performance Award will not be paid to the Participant.
(e) Payment . Following the Board’s determination in accordance with Section 9.2(a), the Company shall settle Performance Awards, in such form (including, without limitation, in shares of Common Stock or in cash) as determined by the Board, in an amount equal to such Participant’s earned Performance Awards; provided that with respect to any Performance Awards settled in shares of Common Stock, the Participant shall, if required by applicable law, provide minimum consideration equal to the accounting par value of such Common Stock. Notwithstanding the foregoing, the Board may, in its sole discretion, award an amount less than the earned Performance Awards and/or subject the payment of all or part of any Performance Award to additional vesting, forfeiture and deferral conditions as it deems appropriate.
(f) Termination . Subject to the applicable provisions of the Award Agreement and the Plan, upon a Participant’s Termination for any reason during the Performance Period for a given Performance Award, the Performance Award in question will vest or be forfeited in accordance with the terms and conditions established by the Board at grant.
(g) Accelerated Vesting . Based on service, performance and/or such other factors or criteria, if any, as the Board may determine, the Board may, at or after grant, accelerate the vesting of all or any part of any Performance Award.
ARTICLE X
OTHER STOCK-BASED AND CASH-BASED AWARDS
10.1 Other Stock-Based Awards . The Board is authorized to grant to Eligible Individuals Other Stock-Based Awards that are payable in, valued in whole or in part by reference
 
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to, or otherwise based on or related to shares of Common Stock, including but not limited to, shares of Common Stock awarded purely as a bonus and not subject to restrictions or conditions, shares of Common Stock in payment of the amounts due under an incentive or performance plan sponsored or maintained by the Company or an Affiliate, stock equivalent units, restricted stock units, and Awards valued by reference to book value of shares of Common Stock. Other Stock-Based Awards may be granted either alone or in addition to or in tandem with other Awards granted under the Plan.
Subject to the provisions of the Plan, the Board shall have authority to determine the Eligible Individuals, to whom, and the time or times at which, such Awards shall be made, the number of shares of Common Stock to be awarded pursuant to such Awards, and all other conditions of the Awards. The Board may also provide for the grant of Common Stock under such Awards upon the completion of a specified Performance Period.
The Board may condition the grant or vesting of Other Stock-Based Awards upon the attainment of specified Performance Goals as the Board may determine, in its sole discretion; provided that to the extent that such Other Stock-Based Awards are intended to comply with Section 162(m) of the Code, the Board shall establish the objective Performance Goals for the grant or vesting of such Other Stock-Based Awards based on a Performance Period applicable to each Participant or class of Participants in writing prior to the beginning of the applicable Performance Period or at such later date as permitted under Section 162(m) of the Code and while the outcome of the Performance Goals are substantially uncertain. Such Performance Goals may incorporate, if and only to the extent permitted under Section 162(m) of the Code, provisions for disregarding (or adjusting for) changes in accounting methods, corporate transactions (including, without limitation, dispositions and acquisitions) and other similar type events or circumstances. To the extent that any such provision would create impermissible discretion under Section 162(m) of the Code or otherwise violate Section 162(m) of the Code, such provision shall be of no force or effect, with respect to Performance Awards that are intended to qualify as “performance-based compensation” under Section 162(m) of the Code.
10.2 Terms and Conditions . Other Stock-Based Awards made pursuant to this Article X shall be subject to the following terms and conditions:
(a) Non-Transferability . Subject to the applicable provisions of the Award Agreement and the Plan, shares of Common Stock subject to Awards made under this Article X may not be Transferred prior to the date on which the shares are issued, or, if later, the date on which any applicable restriction, performance or deferral period lapses.
(b) Dividends . Unless otherwise determined by the Board at the time of Award, subject to the provisions of the Award Agreement and the Plan, the recipient of an Award under this Article X shall not be entitled to receive, currently or on a deferred basis, dividends or dividend equivalents in respect of the number of shares of Common Stock covered by the Award.
(c) Vesting . Any Award under this Article X and any Common Stock covered by any such Award shall vest or be forfeited to the extent so provided in the Award Agreement, as determined by the Board, in its sole discretion.
 
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(d) Price . Common Stock issued under this Article X may be issued for no cash consideration to the extent permitted by applicable law, and, to the extent not so permitted, such purchase price may not be less than the accounting par value. Common Stock purchased pursuant to a purchase right awarded under this Article X shall be priced, as determined by the Board in its sole discretion, which price shall, to the extent required under applicable law, such purchase price shall include, at a minimum, the accounting par value of such Common Stock.
10.3 Other Cash-Based Awards . The Board may from time to time grant Other Cash-Based Awards to Eligible Individuals in such amounts, on such terms and conditions, and for such consideration, including no consideration or such minimum consideration as may be required by applicable law, as it shall determine in its sole discretion. Other Cash-Based Awards may be granted subject to the satisfaction of vesting conditions or may be awarded purely as a bonus and not subject to restrictions or conditions, and if subject to vesting conditions, the Board may accelerate the vesting of such Awards at any time in its sole discretion. The grant of an Other Cash-Based Award shall not require a segregation of any of the Company’s assets for satisfaction of the Company’s payment obligation thereunder.
ARTICLE XI
CHANGE IN CONTROL PROVISIONS
11.1 Benefits . In the event of a Change in Control of the Company (as defined below), and except as otherwise provided by the Board in an Award Agreement, a Participant’s unvested Award shall not vest automatically and a Participant’s Award shall be treated in accordance with one or more of the following methods as determined by the Board:
(a) Awards, whether or not then vested, shall be continued, assumed, or have new rights substituted therefor, as determined by the Board in a manner consistent with the requirements of Section 409A of the Code, and restrictions to which shares of Restricted Stock or any other Award granted prior to the Change in Control are subject shall not lapse upon a Change in Control and the Restricted Stock or other Award shall, where appropriate in the sole discretion of the Board, receive the same distribution as other Common Stock on such terms as determined by the Board; provided that the Board may decide to award additional Restricted Stock or other Awards in lieu of any cash distribution. Notwithstanding anything to the contrary herein, for purposes of Incentive Stock Options, any assumed or substituted Stock Option shall comply with the requirements of Treasury Regulation Section 1.424-1 (and any amendment thereto).
(b) The Board, in its sole discretion, may provide for the purchase of any Awards by the Company or an Affiliate for an amount of cash equal to the excess (if any) of the Change in Control Price (as defined below) of the shares of Common Stock covered by such Awards, over the aggregate exercise price of such Awards. For purposes hereof, “ Change in Control Price ” shall mean the highest price per share of Common Stock paid in any transaction related to a Change in Control of the Company.
(c) The Board may, in its sole discretion, terminate all outstanding and unexercised Stock Options, Stock Appreciation Rights, or any Other Stock-Based Award that provides for a Participant elected exercise, effective as of the date of the Change in Control, by delivering notice of termination to each Participant at least twenty (20) days prior to the date of
 
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consummation of the Change in Control, in which case during the period from the date on which such notice of termination is delivered to the consummation of the Change in Control, each such Participant shall have the right to exercise in full all of such Participant’s Awards that are then outstanding (without regard to any limitations on exercisability otherwise contained in the Award Agreements), but any such exercise shall be contingent on the occurrence of the Change in Control, and, provided that, if the Change in Control does not take place within a specified period after giving such notice for any reason whatsoever, the notice and exercise pursuant thereto shall be null and void.
(d) Notwithstanding any other provision herein to the contrary, the Board may, in its sole discretion, provide for accelerated vesting or lapse of restrictions, of an Award at any time.
11.2 Change in Control . Unless otherwise determined by the Board in the applicable Award Agreement or other written agreement with a Participant approved by the Board, a “Change in Control” shall be deemed to occur if:
(a) Any “person” (as that term is used in Sections 13 and 14(d)(2) of the Exchange Act or any successors thereto) becomes the “beneficial owner” (as that term is used in Section 13(d) of the Exchange Act or any successor thereto), directly or indirectly, of 50% or more of the Company’s capital stock entitled to vote in the election of directors, excluding any “person” who becomes a “beneficial owner” in connection with a Business Combination (as defined in paragraph (c) below) which does not constitute a Change in Control under said paragraph (c);
(b) during any period of two consecutive years, individuals who at the beginning of such period constitute the Board, and any new director (other than a director designated by a person who has entered into an agreement with the Company to effect a transaction described in paragraph (a), (c), or (d) of this Section 11.2 or a director whose initial assumption of office occurs as a result of either an actual or threatened election contest (as such term is used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents by or on behalf of a person other than the Board) whose election by the Board or nomination for election by the Company’s shareholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the two-year period or whose election or nomination for election was previously so approved, cease for any reason to constitute at least a majority of the Board;
(c) consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Company (a “ Business Combination ”), in each case, unless, following such Business Combination, all or substantially all of the individuals and entities who were the beneficial owners of outstanding voting securities of the Company immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the company resulting from such Business Combination (including, without limitation, a company which, as a result of such transaction, owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination, of the outstanding voting securities of the Company; or
 
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(d) a complete liquidation or dissolution of the Company or the consummation of a sale or disposition by the Company of all or substantially all of the Company’s assets other than the sale or disposition of all or substantially all of the assets of the Company to a person or persons who beneficially own, directly or indirectly, 50% or more of the combined voting power of the outstanding voting securities of the Company at the time of the sale.
Notwithstanding the foregoing, with respect to any Award that is characterized as “nonqualified deferred compensation” within the meaning of Section 409A of the Code, an event shall not be considered to be a Change in Control under the Plan for purposes of payment of such Award unless such event is also a “change in ownership,” a “change in effective control” or a “change in the ownership of a substantial portion of the assets” of the Company within the meaning of Section 409A of the Code.
11.3 Initial Public Offering not a Change in Control . Notwithstanding the foregoing, for purposes of the Plan, the occurrence of the Registration Date or any change in the composition of the Board within one year following the Registration Date shall not be considered a Change in Control.
ARTICLE XII
TERMINATION OR AMENDMENT OF PLAN
12.1 Termination or Amendment . Notwithstanding any other provision of the Plan, the Board may at any time, and from time to time, amend, in whole or in part, any or all of the provisions of the Plan (including any amendment deemed necessary to ensure that the Company may comply with any regulatory requirement referred to in Article XIV or Section 409A of the Code), or suspend or terminate it entirely, retroactively or otherwise; provided, however, that, unless otherwise required by law or specifically provided herein, the rights of a Participant with respect to Awards granted prior to such amendment, suspension or termination, may not be impaired without the consent of such Participant and, provided further, that without the approval of the holders of the Company’s Common Stock entitled to vote in accordance with applicable law, no amendment may be made that would (i) increase the aggregate number of shares of Common Stock that may be issued under the Plan (except by operation of Section 4.2); (ii) increase the maximum individual Participant limitations for a fiscal year under Section 4.1(b) (except by operation of Section 4.2); (iii) change the classification of individuals eligible to receive Awards under the Plan; (iv) decrease the minimum option price of any Stock Option or Stock Appreciation Right; (v) extend the maximum option period under Section 6.4; (vi) alter the Performance Goals for Restricted Stock, Performance Awards or Other Stock-Based Awards as set forth in Exhibit A hereto; (vii) award any Stock Option or Stock Appreciation Right in replacement of a canceled Stock Option or Stock Appreciation Right with a higher exercise price than the replacement award; or (viii) require shareholder approval in order for the Plan to continue to comply with the applicable provisions of Section 162(m) of the Code or, to the extent applicable to Incentive Stock Options, Section 422 of the Code. In no event may the Plan be amended without the approval of the shareholders of the Company in accordance with the applicable laws of the State of Delaware to increase the aggregate number of shares of Common
 
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Stock that may be issued under the Plan, decrease the minimum exercise price of any Award, or to make any other amendment that would require shareholder approval under Financial Industry Regulatory Authority (FINRA) rules and regulations or the rules of any exchange or system on which the Company’s securities are listed or traded at the request of the Company. Notwithstanding anything herein to the contrary, the Board may amend the Plan or any Award Agreement at any time without a Participant’s consent to comply with applicable law including Section 409A of the Code. The Board may amend the terms of any Award theretofore granted, prospectively or retroactively, but, subject to Article IV or as otherwise specifically provided herein, no such amendment or other action by the Board shall impair the rights of any holder without the holder’s consent.
ARTICLE XIII
UNFUNDED STATUS OF PLAN
The Plan is intended to constitute an “unfunded” plan for incentive and deferred compensation. With respect to any payment as to which a Participant has a fixed and vested interest but which are not yet made to a Participant by the Company, nothing contained herein shall give any such Participant any right that is greater than those of a general unsecured creditor of the Company.
ARTICLE XIV
GENERAL PROVISIONS
14.1 Plans . Nothing contained in the Plan shall prevent the Board from adopting other or additional compensation arrangements, subject to shareholder approval if such approval is required, and such arrangements may be either generally applicable or applicable only in specific cases.
14.2 No Right to Employment/Directorship/Consultancy . Neither the Plan nor the grant of any Option or other Award hereunder shall give any Participant or other employee, Consultant or Non-Employee Director any right with respect to continuance of employment, consultancy or directorship by the Company or any Affiliate, nor shall there be a limitation in any way on the right of the Company or any Affiliate by which an employee is employed or a Consultant or Non-Employee Director is retained to terminate such employment, consultancy or directorship at any time.
14.3 Withholding of Taxes . The Company or any of its applicable Affiliates shall have the right to deduct from any payment to be made pursuant to the Plan, or to otherwise require, prior to the issuance or delivery of shares of Common Stock or the payment of any cash hereunder, payment by the Participant of, any federal, state or local taxes required by law to be withheld. Upon the vesting of Restricted Stock (or other Award that is taxable upon vesting), or upon making an election under Section 83(b) of the Code (or other applicable law in the relevant jurisdiction), a Participant shall pay all required withholding to the Company (or such Affiliate). Any minimum statutorily required withholding obligation with regard to any Participant may be satisfied, subject to the consent of the Board, by reducing the number of shares of Common Stock otherwise deliverable or by delivering shares of Common Stock already owned. Any fraction of a share of Common Stock required to satisfy such tax obligations shall be disregarded and the amount due shall be paid instead in cash by the Participant, if applicable.
 
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14.4 No Assignment of Benefits . No Award or other benefit payable under the Plan shall, except as otherwise specifically provided by law or permitted by the Board, be Transferable in any manner, and any attempt to Transfer any such benefit shall be void, and any such benefit shall not in any manner be liable for or subject to the debts, contracts, liabilities, engagements or torts of any person who shall be entitled to such benefit, nor shall it be subject to attachment or legal process for or against such person.
14.5 Listing and Other Conditions .
(a) Unless otherwise determined by the Board, as long as the Common Stock is listed on a national securities exchange or system sponsored by a national securities association, the issuance of shares of Common Stock pursuant to an Award shall be conditioned upon such shares being listed on such exchange or system. The Company shall have no obligation to issue such shares unless and until such shares are so listed, and the right to exercise any Option or other Award with respect to such shares shall be suspended until such listing has been effected.
(b) If at any time counsel to the Company shall be of the opinion that any sale or delivery of shares of Common Stock pursuant to an Option or other Award is or may in the circumstances be unlawful or result in the imposition of excise taxes on the Company under the statutes, rules or regulations of any applicable jurisdiction, the Company shall have no obligation to make such sale or delivery, or to make any application or to effect or to maintain any qualification or registration under the Securities Act or otherwise, with respect to shares of Common Stock or Awards, and the right to exercise any Option or other Award shall be suspended until, in the opinion of said counsel, such sale or delivery shall be lawful or will not result in the imposition of excise taxes on the Company.
(c) Upon termination of any period of suspension under this Section 14.6, any Award affected by such suspension which shall not then have expired or terminated shall be reinstated as to all shares available before such suspension and as to shares which would otherwise have become available during the period of such suspension, but no such suspension shall extend the term of any Award.
(d) A Participant shall be required to supply the Company with representations and information that the Company requests and otherwise cooperate with the Company in obtaining any listing, registration, qualification, exemption, consent or approval the Company deems necessary or appropriate.
14.6 Shareholders Agreement and Other Requirements . Notwithstanding anything herein to the contrary, as a condition to the receipt of shares of Common Stock pursuant to an Award under the Plan, to the extent required by the Board, the Participant shall execute and deliver a shareholder’s agreement or such other documentation that shall set forth certain restrictions on transferability of the shares of Common Stock acquired upon exercise or purchase, and such other terms as the Board or Board shall from time to time establish. Such shareholder’s agreement or other documentation shall apply to the Common Stock acquired under the Plan and
 
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covered by such shareholder’s agreement or other documentation. The Company may require, as a condition of exercise, the Participant to become a party to any other existing shareholder agreement (or other agreement).
14.7 Governing Law . The Plan and actions taken in connection herewith shall be governed and construed in accordance with the laws of the State of Delaware (regardless of the law that might otherwise govern under applicable Delaware principles of conflict of laws).
14.8 Jurisdiction; Waiver of Jury Trial . Any suit, action or proceeding with respect to the Plan or any Award Agreement, or any judgment entered by any court of competent jurisdiction in respect of any thereof, shall be resolved only in the courts of the State of Delaware or the United States District Court for the District of Delaware and the appellate courts having jurisdiction of appeals in such courts. In that context, and without limiting the generality of the foregoing, the Company and each Participant shall irrevocably and unconditionally (a) submit in any proceeding relating to the Plan or any Award Agreement, or for the recognition and enforcement of any judgment in respect thereof (a “ Proceeding ”), to the exclusive jurisdiction of the courts of the State of Delaware, the court of the United States of America for the District of Delaware, and appellate courts having jurisdiction of appeals from any of the foregoing, and agree that all claims in respect of any such Proceeding shall be heard and determined in such Delaware State court or, to the extent permitted by law, in such federal court, (b) consent that any such Proceeding may and shall be brought in such courts and waives any objection that the Company and each Participant may now or thereafter have to the venue or jurisdiction of any such Proceeding in any such court or that such Proceeding was brought in an inconvenient court and agree not to plead or claim the same, (c) waive all right to trial by jury in any Proceeding (whether based on contract, tort or otherwise) arising out of or relating to the Plan or any Award Agreement, (d) agree that service of process in any such Proceeding may be effected by mailing a copy of such process by registered or certified mail (or any substantially similar form of mail), postage prepaid, to such party, in the case of a Participant, at the Participant’s address shown in the books and records of the Company or, in the case of the Company, at the Company’s principal offices, attention General Counsel, and (e) agree that nothing in the Plan shall affect the right to effect service of process in any other manner permitted by the laws of the State of Delaware.
14.9 Construction . Wherever any words are used in the Plan in the masculine gender they shall be construed as though they were also used in the feminine gender in all cases where they would so apply, and wherever words are used herein in the singular form they shall be construed as though they were also used in the plural form in all cases where they would so apply.
14.10 Other Benefits . No Award granted or paid out under the Plan shall be deemed compensation for purposes of computing benefits under any retirement plan of the Company or its Affiliates nor affect any benefit under any other benefit plan now or subsequently in effect under which the availability or amount of benefits is related to the level of compensation.
14.11 Costs . The Company shall bear all expenses associated with administering the Plan, including expenses of issuing Common Stock pursuant to Awards hereunder.
 
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14.12 No Right to Same Benefits . The provisions of Awards need not be the same with respect to each Participant, and such Awards to individual Participants need not be the same in subsequent years.
14.13 Death/Disability . The Board may in its discretion require the transferee of a Participant to supply it with written notice of the Participant’s death or Disability and to supply it with a copy of the will (in the case of the Participant’s death) or such other evidence as the Board deems necessary to establish the validity of the transfer of an Award. The Board may also require that the agreement of the transferee to be bound by all of the terms and conditions of the Plan.
14.14 Section 16(b) of the Exchange Act . All elections and transactions under the Plan by persons subject to Section 16 of the Exchange Act involving shares of Common Stock are intended to comply with any applicable exemptive condition under Rule 16b-3. The Board may establish and adopt written administrative guidelines, designed to facilitate compliance with Section 16(b) of the Exchange Act, as it may deem necessary or proper for the administration and operation of the Plan and the transaction of business thereunder.
14.15 Section 409A of the Code . The Plan is intended to comply with the applicable requirements of Section 409A of the Code and shall be limited, construed and interpreted in accordance with such intent. To the extent that any Award is subject to Section 409A of the Code, it shall be paid in a manner that will comply with Section 409A of the Code, including proposed, temporary or final regulations or any other guidance issued by the Secretary of the Treasury and the Internal Revenue Service with respect thereto. Notwithstanding anything herein to the contrary, any provision in the Plan that is inconsistent with Section 409A of the Code shall be deemed to be amended to comply with Section 409A of the Code and to the extent such provision cannot be amended to comply therewith, such provision shall be null and void. The Company shall have no liability to a Participant, or any other party, if an Award that is intended to be exempt from, or compliant with, Section 409A of the Code is not so exempt or compliant or for any action taken by the Board or the Company and, in the event that any amount or benefit under the Plan becomes subject to penalties under Section 409A of the Code, responsibility for payment of such penalties shall rest solely with the affected Participants and not with the Company. Notwithstanding any contrary provision in the Plan or Award Agreement, any payment(s) of “nonqualified deferred compensation” (within the meaning of Section 409A of the Code) that are otherwise required to be made under the Plan to a “specified employee” (as defined under Section 409A of the Code) as a result of such employee’s separation from service (other than a payment that is not subject to Section 409A of the Code) shall be delayed for the first six (6) months following such separation from service (or, if earlier, the date of death of the specified employee) and shall instead be paid (in a manner set forth in the Award Agreement) upon expiration of such delay period.
14.16 Successor and Assigns . The Plan shall be binding on all successors and permitted assigns of a Participant, including, without limitation, the estate of such Participant and the executor, administrator or trustee of such estate.
14.17 Severability of Provisions . If any provision of the Plan shall be held invalid or unenforceable, such invalidity or unenforceability shall not affect any other provisions hereof, and the Plan shall be construed and enforced as if such provisions had not been included.
 
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14.18 Payments to Minors, Etc . Any benefit payable to or for the benefit of a minor, an incompetent person or other person incapable of receipt thereof shall be deemed paid when paid to such person’s guardian or to the party providing or reasonably appearing to provide for the care of such person, and such payment shall fully discharge the Board, the Board, the Company, its Affiliates and their employees, agents and representatives with respect thereto.
14.19 Lock-Up Agreement . As a condition to the grant of an Award, if requested by the Company and the lead underwriter of any public offering of the Common Stock (the “ Lead Underwriter ” ), a Participant shall irrevocably agree not to sell, contract to sell, grant any option to purchase, transfer the economic risk of ownership in, make any short sale of, pledge or otherwise transfer or dispose of, any interest in any Common Stock or any securities convertible into, derivative of, or exchangeable or exercisable for, or any other rights to purchase or acquire Common Stock (except Common Stock included in such public offering or acquired on the public market after such offering) during such period of time following the effective date of a registration statement of the Company filed under the Securities Act that the Lead Underwriter shall specify (the “ Lock-Up Period ”). The Participant shall further agree to sign such documents as may be requested by the Lead Underwriter to effect the foregoing and agree that the Company may impose stop-transfer instructions with respect to Common Stock acquired pursuant to an Award until the end of such Lock-Up Period.
14.20 Headings and Captions . The headings and captions herein are provided for reference and convenience only, shall not be considered part of the Plan, and shall not be employed in the construction of the Plan.
14.21 Section 162(m) of the Code . Notwithstanding any other provision of the Plan to the contrary, (i) prior to the Registration Date and during the Transition Period, the provisions of the Plan requiring compliance with Section 162(m) of the Code for Awards intended to qualify as “performance-based compensation” shall only apply to the extent required by Section 162(m) of the Code, and (ii) the provisions of the Plan requiring compliance with Section 162(m) of the Code shall not apply to Awards granted under the Plan that are not intended to qualify as “performance-based compensation” under Section 162(m) of the Code.
14.22 Post-Transition Period . Following the Transition Period, any Award granted under the Plan that is intended to be “performance-based compensation” under Section 162(m) of the Code, shall be subject to the approval of the material terms of the Plan by a majority of the shareholders of the Company in accordance with Section 162(m) of the Code and the treasury regulations promulgated thereunder.
14.23 Company Recoupment of Awards . A Participant’s rights with respect to any Award hereunder shall in all events be subject to (i) any right that the Company may have under any Company recoupment policy or other agreement or arrangement with a Participant, or (ii) any right or obligation that the Company may have regarding the clawback of “incentive-based compensation” under Section 10D of the Exchange Act and any applicable rules and regulations promulgated thereunder from time to time by the U.S. Securities and Exchange Commission.
 
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ARTICLE XV
EFFECTIVE DATE OF PLAN
The Plan shall become effective on the date of its adoption by the Board.
ARTICLE XVI
TERM OF PLAN
No Award shall be granted pursuant to the Plan on or after the tenth anniversary of the earlier of the date that the Plan is adopted or the date of shareholder approval, but Awards granted prior to such tenth anniversary may extend beyond that date; provided that no Award (other than a Stock Option or Stock Appreciation Right) that is intended to be “performance-based compensation” under Section 162(m) of the Code shall be granted on or after the fifth anniversary of the shareholder approval of the Plan unless the Performance Goals are re-approved (or other designated Performance Goals are approved) by the shareholders no later than the first shareholder meeting that occurs in the fifth year following the year in which shareholders approve the Performance Goals.
ARTICLE XVII
NAME OF PLAN
The Plan shall be known as the “Atento S.A. 2014 Omnibus Incentive Plan.”
 
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EXHIBIT A
PERFORMANCE GOALS
To the extent permitted under Section 162(m) of the Code, performance goals established for purposes of Awards intended to be “performance-based compensation” under Section 162(m) of the Code, shall be based on the attainment of certain target levels of, or a specified increase or decrease (as applicable) in one or more of the following performance goals:
 
 	•	 	earnings per share;	
 
 	•	 	operating income;	
 
 	•	 	gross income;	
 
 	•	 	net income (before or after taxes);	
 
 	•	 	cash flow;	
 
 	•	 	gross profit;	
 
 	•	 	gross profit return on investment;	
 
 	•	 	gross margin return on investment;	
 
 	•	 	gross margin;	
 
 	•	 	operating margin;	
 
 	•	 	working capital;	
 
 	•	 	earnings before interest and taxes;	
 
 	•	 	earnings before interest, tax, depreciation and amortization;	
 
 	•	 	return on equity;	
 
 	•	 	return on assets;	
 
 	•	 	return on capital;	
 
 	•	 	return on invested capital;	
 
 	•	 	net revenues;	
 
 	•	 	gross revenues;	
 
 	•	 	revenue growth;	
 
 	•	 	annual recurring revenues;	
 
 	•	 	recurring revenues;	
 
 	•	 	license revenues;	
 
 	•	 	sales or market share;	
 
 	•	 	total shareholder return;	
 
 	•	 	economic value added;	
 
 	•	 	specified objectives with regard to limiting the level of increase in all or a portion of the Company’s bank debt or other long-term or short-term public or private debt or other similar financial obligations of the Company, which may be calculated net of cash balances and/or other offsets and adjustments as may be established by the Board in its sole discretion;	
 
 	•	 	the fair market value of a share of Common Stock;	
 
 	•	 	the growth in the value of an investment in the Common Stock assuming the reinvestment of dividends; or	
 
 	•	 	reduction in operating expenses.	
 
A-1

With respect to Awards that are intended to qualify as “performance-based compensation” under Section 162(m) of the Code, to the extent permitted under Section 162(m) of the Code, the Board may, in its sole discretion, also exclude, or adjust to reflect, the impact of an event or occurrence that the Board determines should be appropriately excluded or adjusted, including:
(a) restructurings, discontinued operations, extraordinary items or events, and other unusual or non-recurring charges as described in Accounting Standards Codification 225-20, “Extraordinary and Unusual Items,” and/or management’s discussion and analysis of financial condition and results of operations appearing or incorporated by reference in the Company’s Form 10-K for the applicable year;
(b) an event either not directly related to the operations of the Company or not within the reasonable control of the Company’s management; or
(c) a change in tax law or accounting standards required by generally accepted accounting principles.
Performance goals may also be based upon individual participant performance goals, as determined by the Board, in its sole discretion. In addition, Awards that are not intended to qualify as “performance-based compensation” under Section 162(m) of the Code may be based on the performance goals set forth herein or on such other performance goals as determined by the Board in its sole discretion.
In addition, such performance goals may be based upon the attainment of specified levels of Company (or subsidiary, division, other operational unit, administrative department or product category of the Company) performance under one or more of the measures described above relative to the performance of other companies. With respect to Awards that are intended to qualify as “performance-based compensation” under Section 162(m) of the Code, to the extent permitted under Section 162(m) of the Code, but only to the extent permitted under Section 162(m) of the Code (including, without limitation, compliance with any requirements for shareholder approval), the Board may also:
(a) designate additional business criteria on which the performance goals may be based; or
(b) adjust, modify or amend the aforementioned business criteria.
 
A-2

EXHIBIT B
RULES APPLICABLE TO BRAZILIAN EMPLOYEES ONLY
Notwithstanding anything contained in the Plan, for Brazilian employees receiving Awards, the following definitions and conditions shall apply:
 
 	•	 	All Awards granted shall be subjected to a vesting period of at least twelve (12) months.	
 
 	•	 	Upon the exercise of an Option, the beneficiary shall pay to the Company an amount in cash equal to the Exercise Price multiplied by the number of shares being exercised.	
 
 	•	 	The Exercise Price of Options shall correspond to the Fair Market Value.	
 
 	•	 	Awards can be granted in common or restricted shares.	
 
 	•	 	No Awards shall be granted in cash.	
 
 	•	 	The provisions of Articles 482 and 483 of the Brazilian Labor Code will be used to define “Cause” for the termination of employment agreements.	
 
 	•	 	Brazilian Securities Act shall be understood as the Law 6,385/1976.	
 
 	•	 	Code shall be understood as the Brazilian Tax Code and regulations.	
 
 	•	 	Disability shall be understood as the concept set forth in Law 8,213/1991, unless otherwise determined by the Board in the applicable Award Agreement.	
 
B-1

Exhibit 10.11
PERFORMANCE RESTRICTED STOCK UNIT AGREEMENT
PURSUANT TO THE
ATENTO S.A. 2014 OMNIBUS INCENTIVE PLAN
* * * * *

Participant:                                          	
	
Grant Date:                                         	
	
Number of Restricted Stock Units Granted:                             	
* * * * *
THIS PERFORMANCE RESTRICTED STOCK UNIT AWARD AGREEMENT (this “ Agreement ”), dated as of the Grant Date specified above, is entered into by and between Atento S.A., a corporation incorporated and existing in the Grand Duchy of Luxembourg (the “ Company ”), and the Participant specified above, pursuant to the Atento S.A. 2014 Omnibus Incentive Plan, as in effect and as amended from time to time (the “ Plan ”), which is administered by the Board; and
WHEREAS, it has been determined under the Plan that it would be in the best interests of the Company to grant the Restricted Stock Units (“ RSUs ”) provided herein to the Participant.
NOW, THEREFORE, in consideration of the mutual covenants and promises hereinafter set forth and for other good and valuable consideration, including (without limitation) the Participant’s entering into the Employee Non-Compete Agreement attached hereto as Exhibit A , the parties hereto hereby mutually covenant and agree as follows:
1. Incorporation By Reference; Plan Document Receipt . This Agreement is subject in all respects to the terms and provisions of the Plan in force as of the date hereof, all of which terms and provisions are made a part of and incorporated in this Agreement as if they were each expressly set forth herein. Any capitalized term not defined in this Agreement shall have the same meaning as is ascribed thereto in the Plan. The Participant hereby acknowledges receipt of a true copy of the Plan and that the Participant has read the Plan carefully and fully understands its content. In the event of any conflict between the terms of this Agreement and the terms of the Plan, the terms of the Plan shall control.
2. Grant of Restricted Stock Unit Award . The Company hereby grants to the Participant, as of the Grant Date specified above, the number of RSUs specified above. Except as otherwise provided by the Plan, the Participant agrees and understands that nothing contained in this Agreement provides, or is intended to provide, the Participant with any protection against potential future dilution of the Participant’s interest in the Company for any reason, and no adjustments shall be made for dividends in cash or other property, distributions or other rights in respect of the shares of Common Stock underlying the RSUs, except as otherwise specifically provided for in the Plan or this Agreement.

3. Vesting .
(a) Subject to the provisions of Sections 3(b) and 3(c) hereof, the RSUs subject to this Award shall become vested only if each of the Time Vesting Condition and the Performance Vesting Condition set forth in this Section 3 are satisfied. RSUs that satisfy each of these conditions are referred to herein as “ Vested RSUs ” and RSUs that have not satisfied both of these conditions are referred to herein as “ Unvested RSUs ”.
 
 	(i)	Time-based vesting conditions . 100% of the RSUs shall satisfy the time-based vesting condition (the “ Time Vesting Condition ”) upon the third (3rd) anniversary of the Grant Date hereof, subject to the Participant not incurring a Termination prior to such date; provided, however, that if the Participant incurs a Termination prior to the third anniversary of the Grant Date and such Termination is also a Good Leaver Termination (as defined below), a portion of the RSUs shall be deemed to have satisfied the Time Vesting Condition, with such portion determining by multiplying the total number of RSUs granted hereunder by a fraction, the numerator of which is the number of months of employment that have elapsed between the Grant Date and the date of such Termination, and the denominator of which is 36. Any RSUs that have not satisfied the Time Vesting Condition as of the date of Termination (after taking into account any accelerated vesting provided in the previous sentence and/or in Section 3(b)), shall immediately expire upon such Termination. For purposes herein, a “Good Leaver Termination” is a Termination that occurs by reason of a Participant’s death; Disability; a retirement by mutual agreement between the parties; a Termination by the Company or any of its Subsidiaries other than for Cause; or for any reason deemed a “Good Leaver Termination” by the Board.	
 
 	(ii)	Performance-based vesting conditions . 50% of the RSUs shall satisfy the performance-vesting condition (the “ Performance Vesting Condition ”), if at all, based on the TSR thresholds set forth in the table below (the “ TSR Tranche ”), as determined by the Board, and measured from the [Registration Date through the third (3rd) anniversary of the end of the financial quarter immediately preceding the Grant Date] 1 (the “ Performance Period ”); and the remaining 50% of the RSUs shall satisfy the Performance Vesting Condition, if at all, based on the Adjusted EBITDA thresholds set forth in the table below (the “ EBITDA Tranche ”), as determined by the Board following the conclusion of the Performance Period[; provided , that for purposes of measuring the EBITDA Tranche, the Performance Period shall include the time period between end of the financial quarter immediately preceding the Grant Date through the third (3rd) anniversary of the end of the financial quarter immediately preceding the Grant Date] 2 .	

1  	IPO grants only; for subsequent grants, insert “end of the financial quarter immediately preceding the Grant Date through the third (3rd) anniversary of such date.	
2  	IPO grants only; for subsequent grants, delete bracketed language.	
 
2

					
 	  	TSR	 	Adjusted EBITDA	
Threshold Performance
 
(25% of applicable RSUs satisfy Performance Vesting Condition)	  	10% compound
annual growth	 	8% compound
annual growth	
			
Maximum Performance
 
(100% of applicable RSUs satisfy Performance Vesting Condition)	  	22% compound
annual growth	 	13.5% compound
annual growth	
With respect to each tranche (considered individually), (i) none of the relevant RSUs shall satisfy the applicable Performance Vesting Condition if the respective Threshold Performance percentage set forth above is not achieved; (ii) 25% of the relevant RSUs shall satisfy the applicable Performance Vesting Condition if the respective Threshold Performance percentage set forth above is achieved; (iii) 100% of the relevant RSUs shall satisfy the applicable Performance Vesting Condition if the respective Maximum Performance percentage set forth above is achieved or exceeded; and (iv) the relevant RSUs shall vest on a straight line interpolation basis if performance exceeds the respective Threshold Performance percentage but does not achieve the respective Maximum Performance percentage. In no event shall more than 100% of the RSUs allocated to particular Performance Vesting Condition be deemed to satisfy such Performance Vesting Condition. The Board shall determine whether the applicable Performance Vesting Condition is satisfied within forty-five (45) days following the end of the Performance Period. To the extent that the Board determines that the Performance Vesting Condition has not been satisfied, the RSUs shall immediately expire (whether or not the Time Vesting Condition is satisfied) and the Participant shall have no further rights under the RSUs.
(b) Board Discretion to Accelerate Vesting . Notwithstanding the foregoing, the Board may, in its sole discretion, determine that Unvested RSUs shall become Vested RSUs at any time and for any reason.
 
3

(c) Take Private Transaction . Notwithstanding anything to the contrary contained in the Plan or herein, if 100% of the Company’s shares of Common Stock cease to be traded on a nationally recognized stock exchange and the Company is no longer listed on any such exchange, or in the event that the Board passes a resolution stating that for purposes of the Plan such a transaction is imminent (a “ Take Private Transaction ”), (i) a portion of the RSUs shall be deemed to have satisfied the Time Vesting Condition, with such portion determining by multiplying the total number of RSUs granted hereunder by a fraction, the numerator of which is the number of months of employment that have elapsed between the Grant Date and the date of such Take Private Transaction, and the denominator of which is 36; (ii) the Performance Period shall be measured from the end of the financial quarter immediately preceding Grant Date through the end of the financial quarter immediately preceding date of such Take Private Transaction; and (iii) subject to Section 3(b) hereof, any RSUs that remain outstanding through the end of the Performance Period (as modified herein), and to which the Board determines that either of the Time Vesting Condition or the applicable Performance Vesting Condition has not been satisfied, shall expire immediately following the Board’s determination.
(d) Forfeiture . Subject to the Board’s discretion to accelerate vesting hereunder, (i) no additional RSUs shall satisfy the Time Vesting Condition following the Participant’s Termination for any reason (after taking into account any RSUs that satisfy the Time Vesting Condition due to such termination being a Good Leaver Termination), and (ii) any RSUs that remain outstanding through the end of the Performance Period, and to which the Board determines the applicable Performance Vesting Condition has not been satisfied, shall expire immediately following the Board’s determination. In the event of a Participant’s Termination by the Company for Cause or upon a material breach of any provision of the Employee Non-Compete Agreement, attached hereto as Exhibit A , or any other restrictive covenant agreement between the Company and the Participant, all Unvested RSUs and any Vested RSUs that have not yet been settled in accordance with Section 4 herein shall be immediately forfeited upon such Termination or material breach, and the Participant shall have no further rights hereunder.
(e) Definitions . For purposes herein, “ Adjusted EBITDA ” shall mean the last twelve months’ per year compound growth in constant currency adjusted earnings before interest, tax, depreciation and amortization, pro-forma for any change in perimeter, and “ TSR ” shall mean the per year compound growth rate in total shareholder return; provided that the Adjusted EBITDA targets set forth above shall be adjusted as determined by the Board to reflect any Section 4.2 Event.
4. Delivery of Shares .
(a) General . Subject to the Section 4(b) hereof, promptly following the date that the RSUs become Vested RSUs [(but in no event later than March 15 of the calendar year following the calendar year in which the Performance Period ends or, if earlier, March 15 of the calendar year following the calendar year in which the RSUs become Vested RSUs] 3 , the Participant shall receive the number of shares of Common Stock that correspond to such number of RSUs that have become vested on the applicable vesting date; provided that the Participant shall be obligated to pay to the Company the aggregate accounting par value of the shares of Common Stock to be issued within ten (10) days following the issuance of such shares unless such shares have been issued by the Company from the Company’s treasury.

3  	U.S. participants only.	
 
4

(b) Blackout Periods . If the Participant is subject to any Company “blackout” policy or other trading restriction imposed by the Company on the date such distribution would otherwise be made pursuant to Section 4(a) hereof, such distribution shall be instead made on the [earlier of (i) the date that the Participant is not subject to any such policy or restriction and (ii) March 15 of the calendar year following the calendar year in which the RSUs became Vested RSUs, and (iii) March 15 of the calendar year following the calendar year in which the Performance Period ends.
(c) Specified Employees. Notwithstanding anything to the contrary in this Agreement, if the Participant is deemed on the date of Termination to be a “specified employee” within the meaning of that term under Section 409A(a)(2)(B) of the Code, then with regard to any payment or settlement of the RSUs provided hereunder that is considered deferred compensation under Code Section 409A payable on account of a “separation from service,” such payment or benefit shall not be made or provided until the date which is the earlier of (A) the expiration of the six (6)-month period measured from the date of such “separation from service” of the Participant, and (B) the date of the Participant’s death, to the extent required under Section 409A of the Code. Upon the expiration of the foregoing delay period, all payments and benefits delayed herein shall be paid or settled to the Participant in a lump sum, and any remaining payments and benefits due under this Agreement shall be paid or settled in accordance with the normal payment dates specified for them herein] 4 .
5. Dividends; Rights as Stockholder . Except as otherwise provided herein, the Participant shall have no rights to dividends or otherwise as a stockholder (including, without limitation, the right to vote) with respect to any shares of Common Stock covered by any RSU unless and until the Participant has become the holder of record of such shares.
6. Non-Transferability . No portion of the RSUs may be sold, assigned, transferred, encumbered, hypothecated or pledged by the Participant, other than to the Company as a result of forfeiture of the RSUs as provided herein, unless and until payment is made in respect of vested RSUs in accordance with the provisions hereof and the Participant has become the holder of record of the vested shares of Common Stock issuable hereunder.
7. Governing Law . All questions concerning the construction, validity and interpretation of this Agreement shall be governed by, and construed in accordance with, the laws of the State of Luxembourg, without regard to the choice of law principles thereof.
8. Withholding of Tax . The Company or any of its applicable Affiliates shall have the power and the right to deduct or withhold, or require the Participant to remit to the Company (or such Affiliate), an amount sufficient to satisfy any federal, state, local and foreign taxes of any kind (including, but not limited to, the Participant’s FICA, social security and SDI obligations) which the Company (or such Affiliate), in its sole discretion, deems necessary to be withheld or remitted to comply with the Code and/or any other applicable law, rule or regulation

4  	U.S. participants only. All others, insert “the date that the Participant is not subject to any such policy or restriction” and delete Section 4(c).	
 
5

with respect to the RSUs and, if the Participant fails to do so, the Company may otherwise refuse to issue or transfer any shares of Common Stock otherwise required to be issued pursuant to this Agreement.
9. Legend . The Company may at any time place legends referencing any applicable federal, state or foreign securities law restrictions on all certificates representing shares of Common Stock issued pursuant to this Agreement. The Participant shall, at the request of the Company, promptly present to the Company any and all certificates representing shares of Common Stock acquired pursuant to this Agreement in the possession of the Participant in order to carry out the provisions of this Section 9.
10. Securities Representations . This Agreement is being entered into by the Company in reliance upon the following express representations and warranties of the Participant. The Participant hereby acknowledges, represents and warrants that:
(a) The Participant has been advised that the Participant may be an “affiliate” within the meaning of Rule 144 under the Securities Act and in this connection the Company is relying in part on the Participant’s representations set forth in this Section 10.
(b) If the Participant is deemed an affiliate within the meaning of Rule 144 of the Securities Act, the shares of Common Stock issuable hereunder must be held indefinitely unless an exemption from any applicable resale restrictions is available or the Company files an additional registration statement (or a “re-offer prospectus”) with regard to such shares of Common Stock and the Company is under no obligation to register such shares of Common Stock (or to file a “re-offer prospectus”).
(c) If the Participant is deemed an affiliate within the meaning of Rule 144 of the Securities Act, the Participant understands that (i) the exemption from registration under Rule 144 will not be available unless (A) a public trading market then exists for the Common Stock of the Company, (B) adequate information concerning the Company is then available to the public, and (C) other terms and conditions of Rule 144 or any exemption therefrom are complied with, and (ii) any sale of the shares of Common Stock issuable hereunder may be made only in limited amounts in accordance with the terms and conditions of Rule 144 or any exemption therefrom.
11. Entire Agreement; Amendment . This Agreement, together with the Plan, contains the entire agreement between the parties hereto with respect to the subject matter contained herein, and supersedes all prior agreements or prior understandings, whether written or oral, between the parties relating to such subject matter. This Agreement may be modified or amended by a writing signed by both the Company and the Participant.
12. Notices . Any notice hereunder by the Participant shall be given to the Company in writing and such notice shall be deemed duly given only upon receipt thereof by the General Counsel of the Company. Any notice hereunder by the Company shall be given to the Participant in writing and such notice shall be deemed duly given only upon receipt thereof at such address as the Participant may have on file with the Company.
 
6

13. No Right to Employment . Any questions as to whether and when there has been a Termination and the cause of such Termination shall be determined in the sole discretion of the Board. Nothing in this Agreement shall interfere with or limit in any way the right of the Company, its Subsidiaries or its Affiliates to terminate the Participant’s employment or service at any time, for any reason and with or without Cause.
14. Transfer of Personal Data . The Participant authorizes, agrees and unambiguously consents to the transmission by the Company (or any Subsidiary) of any personal data information related to the RSUs awarded under this Agreement for legitimate business purposes (including, without limitation, the administration of the Plan). This authorization and consent is freely given by the Participant.
15. Compliance with Laws . The grant of RSUs and the issuance of shares of Common Stock hereunder shall be subject to, and shall comply with, any applicable requirements of any foreign and U.S. federal and state securities laws, rules and regulations (including, without limitation, the provisions of the Securities Act, the Exchange Act and in each case any respective rules and regulations promulgated thereunder) and any other law, rule regulation or exchange requirement applicable thereto. The Company shall not be obligated to issue the RSUs or any shares of Common Stock pursuant to this Agreement if any such issuance would violate any such requirements. As a condition to the settlement of the RSUs, the Company may require the Participant to satisfy any qualifications that may be necessary or appropriate to evidence compliance with any applicable law or regulation.
16. Binding Agreement; Assignment . This Agreement shall inure to the benefit of, be binding upon, and be enforceable by the Company and its successors and assigns. The Participant shall not assign (except in accordance with Section 6 hereof) any part of this Agreement without the prior express written consent of the Company.
17. Headings . The titles and headings of the various sections of this Agreement have been inserted for convenience of reference only and shall not be deemed to be a part of this Agreement.
18. Signatures . This Agreement is shall be made out in 2 (two) original copies, one for each of the Parties. All original copies hereof are identical and legally equal.
19. Further Assurances . Each party hereto shall do and perform (or shall cause to be done and performed) all such further acts and shall execute and deliver all such other agreements, certificates, instruments and documents as either party hereto reasonably may request in order to carry out the intent and accomplish the purposes of this Agreement and the Plan and the consummation of the transactions contemplated thereunder.
20. Severability . The invalidity or unenforceability of any provisions of this Agreement in any jurisdiction shall not affect the validity, legality or enforceability of the remainder of this Agreement in such jurisdiction or the validity, legality or enforceability of any provision of this Agreement in any other jurisdiction, it being intended that all rights and obligations of the parties hereunder shall be enforceable to the fullest extent permitted by law.
21. Acquired Rights . The Participant acknowledges and agrees that: (a) the Company may terminate or amend the Plan at any time; (b) the Award of RSUs made under this Agreement is completely independent of any other award or grant and is made at the sole
 
7

discretion of the Company; (c) no past grants or awards (including, without limitation, the RSUs awarded hereunder) give the Participant any right to any grants or awards in the future whatsoever; and (d) any benefits granted under this Agreement are not part of the Participant’s ordinary salary, and shall not be considered as part of such salary in the event of severance, redundancy or resignation.
[Remainder of Page Intentionally Left Blank]
 
8

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

ATENTO S.A.	
		
By:	 	 	
		
Name:	 	 	
		
Title:	 	 	
	
PARTICIPANT	

		
Name:	 	 	
 
9

EXHIBIT A
[attach form of Employee Non-Compete Agreement]
 
10

Exhibit 10.12
TIME RESTRICTED STOCK UNIT AGREEMENT
PURSUANT TO THE
ATENTO S.A. 2014 OMNIBUS INCENTIVE PLAN
* * * * *
Participant:                                          
Grant Date:                                         
Number of Restricted Stock Units Granted:                                          
* * * * *
THIS TIME RESTRICTED STOCK UNIT AWARD AGREEMENT (this “ Agreement ”), dated as of the Grant Date specified above, is entered into by and between Atento S.A., a corporation incorporated and existing in the Grand Duchy of Luxembourg(the “ Company ”), and the Participant specified above, pursuant to the Atento S.A. 2014 Omnibus Incentive Plan, as in effect and as amended from time to time (the “ Plan ”), which is administered by the Board; and
WHEREAS, it has been determined under the Plan that it would be in the best interests of the Company to grant the Restricted Stock Units (“ RSUs ”) provided herein to the Participant.
NOW, THEREFORE, in consideration of the mutual covenants and promises hereinafter set forth and for other good and valuable consideration, including (without limitation) the Participant’s entering into the Employee Non-Compete Agreement attached hereto as Exhibit A , the parties hereto hereby mutually covenant and agree as follows:
1. Incorporation By Reference; Plan Document Receipt . This Agreement is subject in all respects to the terms and provisions of the Plan in force as of the date hereof, all of which terms and provisions are made a part of and incorporated in this Agreement as if they were each expressly set forth herein. Any capitalized term not defined in this Agreement shall have the same meaning as is ascribed thereto in the Plan. The Participant hereby acknowledges receipt of a true copy of the Plan and that the Participant has read the Plan carefully and fully understands its content. In the event of any conflict between the terms of this Agreement and the terms of the Plan, the terms of the Plan shall control.
2. Grant of Restricted Stock Unit Award . The Company hereby grants to the Participant, as of the Grant Date specified above, the number of RSUs specified above. Except as otherwise provided by the Plan, the Participant agrees and understands that nothing contained in this Agreement provides, or is intended to provide, the Participant with any protection against potential future dilution of the Participant’s interest in the Company for any reason, and no adjustments shall be made for dividends in cash or other property, distributions or other rights in respect of the shares of Common Stock underlying the RSUs, except as otherwise specifically provided for in the Plan or this Agreement.

3. Vesting .
(a) Subject to the provisions of Sections 3(b) and 3(c) hereof, 50% of the RSUs subject to this Award shall become vested on the first anniversary of the Grant Date specified above, and the remaining RSUs subject to this Award shall become vested on the second anniversary of the Grant Date specified above (each such date, a “ Vesting Date ”), so long as the Participant remains employed by, or is otherwise providing services to, the Company or any of its Subsidiaries through the applicable Vesting Date; provided , that if the Participant incurs a Termination prior to a Vesting Date and such Termination is also a Good Leaver Termination (as defined below), the RSUs that would have otherwise vested on the next Vesting Date following such Termination, had the Participant not incurred a Termination prior to such time, shall vest upon such Vesting Date on a pro rata basis (determined by multiplying the number of RSUs that otherwise would have vested upon such Vesting Date by a fraction, the numerator of which is the number of months of employment that have elapsed between the most recent prior Vesting Date or, if no such Vesting Date has occurred, the Grant Date, and the date of such Termination, and the denominator of which is 12). For purposes herein, a “Good Leaver Termination” shall mean a Termination that occurs by reason of a Participant’s death; Disability; a retirement by mutual agreement between the parties; or a Termination by the Company or any of its Subsidiaries other than for Cause or for any reason deemed a “Good Leaver Termination” by the Board.
(b) Board Discretion to Accelerate Vesting . Notwithstanding the foregoing, the Board may, in its sole discretion, provide for accelerated vesting of the RSUs at any time and for any reason.
(c) Take Private Transaction . Notwithstanding anything to the contrary contained in the Plan or herein, if 100% of the Company’s shares of Common Stock cease to be traded on a nationally recognized stock exchange and the Company is no longer listed on any such exchange, or in the event that the Board passes a resolution stating that for purposes of the Plan such a transaction is imminent (a “ Take Private Transaction ”), 100% of the unvested RSUs shall vest upon the next Vesting Date.
(d) Forfeiture . Subject to the Board’s discretion to accelerate vesting hereunder, (i) upon a Participant’s Termination for Cause or upon a material breach of any provision of the Employee Non-Compete Agreement, attached hereto as Exhibit A , or any other restrictive covenant agreement between the Company and the Participant, all Unvested RSUs and any Vested RSUs that have not yet been settled in accordance with Section 4 herein shall be immediately forfeited upon such Termination or material breach, (ii) upon the Participant’s Termination that is not a Good Leaver Termination (and excluding any Termination that is otherwise described in (i)), all unvested RSUs shall be immediately forfeited, and (iii) upon the Participant’s Termination that is a Good Leaver Termination, any unvested RSUs that will not vest upon the following Vesting Date shall be immediately forfeited upon such Termination or material breach, and the Participant shall have no further rights hereunder.
 
2

4. Delivery of Shares .
(a) General . Subject to the Section 4(b) hereof, the Participant shall receive the number of shares of Common Stock that correspond to such number of RSUs that have become vested prior to such time in accordance with Section 3, promptly following[, but in no event later than thirty (30) days following, the next to occur of (i) the first (1st) anniversary of the Grant Date, or (ii) the second (2nd) anniversary of the Grant Date; provided that the Participant shall be obligated to pay to the Company the aggregate accounting par value of the shares of Common Stock to be issued within ten (10) days following the issuance of such shares unless such shares have been issued by the Company from the Company’s treasury.
(b) Blackout Periods . If the Participant is subject to any Company “blackout” policy or other trading restriction imposed by the Company on the date such distribution would otherwise be made pursuant to Section 4(a) hereof, such distribution shall be instead made on the [earlier of (i) the date that the Participant is not subject to any such policy or restriction and (ii) the later of (A) the end of the calendar year in which such distribution would otherwise have been made and (B) a date that is immediately prior to the expiration of two and one-half months following the date such distribution would otherwise have been made pursuant to Section 4(a).
(c) Specified Employees . Notwithstanding anything to the contrary in this Agreement, if the Participant is deemed on the date of Termination to be a “specified employee” within the meaning of that term under Section 409A(a)(2)(B) of the Code, then with regard to any payment or settlement of the RSUs provided hereunder that is considered deferred compensation under Code Section 409A payable on account of a “separation from service,” such payment or benefit shall not be made or provided until the date which is the earlier of (A) the expiration of the six (6)-month period measured from the date of such “separation from service” of the Participant, and (B) the date of the Participant’s death, to the extent required under Section 409A of the Code. Upon the expiration of the foregoing delay period, all payments and benefits delayed herein shall be paid or settled to the Participant in a lump sum, and any remaining payments and benefits due under this Agreement shall be paid or settled in accordance with the normal payment dates specified for them herein.] 1
5. Dividends; Rights as Stockholder . Except as otherwise provided herein, the Participant shall have no rights to dividends or otherwise as a stockholder (including, without limitation, the right to vote) with respect to any shares of Common Stock covered by any RSU unless and until the Participant has become the holder of record of such shares.
6. Non-Transferability . No portion of the RSUs may be sold, assigned, transferred, encumbered, hypothecated or pledged by the Participant, other than to the Company as a result of forfeiture of the RSUs as provided herein, unless and until payment is made in respect of vested RSUs in accordance with the provisions hereof and the Participant has become the holder of record of the vested shares of Common Stock issuable hereunder.
7. Governing Law . All questions concerning the construction, validity and interpretation of this Agreement shall be governed by, and construed in accordance with, the laws of the State of Luxembourg, without regard to the choice of law principles thereof.

1  	U.S. participants only. All others, insert “the date that the Participant is not subject to any such policy or restriction” and delete Section 4(c).	
 
3

8. Withholding of Tax . The Company or any of its applicable Affiliates shall have the power and the right to deduct or withhold, or require the Participant to remit to the Company (or such Affiliate), an amount sufficient to satisfy any federal, state, local and foreign taxes of any kind (including, but not limited to, the Participant’s FICA, social security and SDI obligations) which the Company (or such Affiliate), in its sole discretion, deems necessary to be withheld or remitted to comply with the Code and/or any other applicable law, rule or regulation with respect to the RSUs and, if the Participant fails to do so, the Company may otherwise refuse to issue or transfer any shares of Common Stock otherwise required to be issued pursuant to this Agreement.
9. Legend . The Company may at any time place legends referencing any applicable federal, state or foreign securities law restrictions on all certificates representing shares of Common Stock issued pursuant to this Agreement. The Participant shall, at the request of the Company, promptly present to the Company any and all certificates representing shares of Common Stock acquired pursuant to this Agreement in the possession of the Participant in order to carry out the provisions of this Section 9.
10. Securities Representations . This Agreement is being entered into by the Company in reliance upon the following express representations and warranties of the Participant. The Participant hereby acknowledges, represents and warrants that:
(a) The Participant has been advised that the Participant may be an “affiliate” within the meaning of Rule 144 under the Securities Act and in this connection the Company is relying in part on the Participant’s representations set forth in this Section 10.
(b) If the Participant is deemed an affiliate within the meaning of Rule 144 of the Securities Act, the shares of Common Stock issuable hereunder must be held indefinitely unless an exemption from any applicable resale restrictions is available or the Company files an additional registration statement (or a “re-offer prospectus”) with regard to such shares of Common Stock and the Company is under no obligation to register such shares of Common Stock (or to file a “re-offer prospectus”).
(c) If the Participant is deemed an affiliate within the meaning of Rule 144 of the Securities Act, the Participant understands that (i) the exemption from registration under Rule 144 will not be available unless (A) a public trading market then exists for the Common Stock of the Company, (B) adequate information concerning the Company is then available to the public, and (C) other terms and conditions of Rule 144 or any exemption therefrom are complied with, and (ii) any sale of the shares of Common Stock issuable hereunder may be made only in limited amounts in accordance with the terms and conditions of Rule 144 or any exemption therefrom.
11. Entire Agreement; Amendment . This Agreement, together with the Plan, contains the entire agreement between the parties hereto with respect to the subject matter contained herein, and supersedes all prior agreements or prior understandings, whether written or oral, between the parties relating to such subject matter. This Agreement may be modified or amended by a writing signed by both the Company and the Participant.
 
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12. Notices . Any notice hereunder by the Participant shall be given to the Company in writing and such notice shall be deemed duly given only upon receipt thereof by the General Counsel of the Company. Any notice hereunder by the Company shall be given to the Participant in writing and such notice shall be deemed duly given only upon receipt thereof at such address as the Participant may have on file with the Company.
13. No Right to Employment . Any questions as to whether and when there has been a Termination and the cause of such Termination shall be determined in the sole discretion of the Board. Nothing in this Agreement shall interfere with or limit in any way the right of the Company, its Subsidiaries or its Affiliates to terminate the Participant’s employment or service at any time, for any reason and with or without Cause.
14. Transfer of Personal Data . The Participant authorizes, agrees and unambiguously consents to the transmission by the Company (or any Subsidiary) of any personal data information related to the RSUs awarded under this Agreement for legitimate business purposes (including, without limitation, the administration of the Plan). This authorization and consent is freely given by the Participant.
15. Compliance with Laws . The grant of RSUs and the issuance of shares of Common Stock hereunder shall be subject to, and shall comply with, any applicable requirements of any foreign and U.S. federal and state securities laws, rules and regulations (including, without limitation, the provisions of the Securities Act, the Exchange Act and in each case any respective rules and regulations promulgated thereunder) and any other law, rule regulation or exchange requirement applicable thereto. The Company shall not be obligated to issue the RSUs or any shares of Common Stock pursuant to this Agreement if any such issuance would violate any such requirements. As a condition to the settlement of the RSUs, the Company may require the Participant to satisfy any qualifications that may be necessary or appropriate to evidence compliance with any applicable law or regulation.
16. Binding Agreement; Assignment . This Agreement shall inure to the benefit of, be binding upon, and be enforceable by the Company and its successors and assigns. The Participant shall not assign (except in accordance with Section 6 hereof) any part of this Agreement without the prior express written consent of the Company.
17. Headings . The titles and headings of the various sections of this Agreement have been inserted for convenience of reference only and shall not be deemed to be a part of this Agreement.
18. Signatures . This Agreement is shall be made out in 2 (two) original copies, one for each of the Parties. All original copies hereof are identical and legally equal.
19. Further Assurances . Each party hereto shall do and perform (or shall cause to be done and performed) all such further acts and shall execute and deliver all such other agreements, certificates, instruments and documents as either party hereto reasonably may request in order to carry out the intent and accomplish the purposes of this Agreement and the Plan and the consummation of the transactions contemplated thereunder.
 
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20. Severability . The invalidity or unenforceability of any provisions of this Agreement in any jurisdiction shall not affect the validity, legality or enforceability of the remainder of this Agreement in such jurisdiction or the validity, legality or enforceability of any provision of this Agreement in any other jurisdiction, it being intended that all rights and obligations of the parties hereunder shall be enforceable to the fullest extent permitted by law.
21. Acquired Rights . The Participant acknowledges and agrees that: (a) the Company may terminate or amend the Plan at any time; (b) the Award of RSUs made under this Agreement is completely independent of any other award or grant and is made at the sole discretion of the Company; (c) no past grants or awards (including, without limitation, the RSUs awarded hereunder) give the Participant any right to any grants or awards in the future whatsoever; and (d) any benefits granted under this Agreement are not part of the Participant’s ordinary salary, and shall not be considered as part of such salary in the event of severance, redundancy or resignation.
[Remainder of Page Intentionally Left Blank]
 
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

ATENTO S.A.	
		
By:	 	 	
		
Name:	 	 	
		
Title:	 	 	

PARTICIPANT	

		
Name:	 	 	
 
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EXHIBIT A
[ attach form of Employee Non-Compete Agreement ]
 
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Exhibit 10.13
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated as of [            ], 2014, by and among Atento S.A. (the “ Company ”), Atalaya Luxco Pikco S.C.A. (“PikCo”), each of the Persons listed on the signature pages attached hereto (the “ Other Investors ”) and each other Person who executes a joinder hereto (collectively with PikCo and the Other Investors, the “ Holders ,” and each a “ Holder ”). Capitalized terms used herein but not otherwise defined shall have the meanings assigned to such terms in Section 1.
1. Definitions . As used herein, the following terms shall have the following meanings.
“ Business Day ” means any day of the year on which national banking institutions in New York are open to the public for conducting business and are not required or authorized to close.
“ Exchange Act ” means the Securities Exchange Act of 1934, as amended.
“ Free Writing Prospectus ” means a free-writing prospectus, as defined in Rule 405 of the Securities Act.
“ Holder ” has the meaning set forth in the preamble hereof.
“ Ordinary Shares ” means the Company’s ordinary shares, nominal value €1.00 per share of the Company or any successor security thereto.
“ Person ” means an individual, a partnership, a corporation, a limited liability company, an association, a joint stock company, a trust, a joint venture, an unincorporated organization or other entity, or a governmental entity (or any department, agency or political subdivision thereof).
“ Registrable Securities ” means (i) any Ordinary Shares issued or issuable to any Holder, (ii) any securities of the Company issued or issuable directly or indirectly with respect to the securities referred to in clause (i) immediately above and clause (iii) immediately below by way of dividend, split, combination, recapitalization, exchange, merger, consolidation or other reorganization, and (iii) any Ordinary Shares held by any Holder on the date hereof or thereafter. As to any particular Registrable Securities, such securities will cease to be Registrable Securities when they have been (a) distributed to the public pursuant to an offering registered under the Securities Act or (b) sold to the public through a broker, dealer or market maker in compliance with Rule 144. For purposes of this Agreement, a Person will be deemed to be a Holder whenever such Person has the right to acquire such Registrable Securities (upon conversion or exercise in connection with a transfer of securities or otherwise), whether or not such acquisition has actually been effected.
“ Registration Expenses ” has the meaning set forth in Section 6 below.
“ Rule 144 ” means Rule 144 under the Securities Act (or any similar rule then in force).

“ Securities Act ” means the Securities Act of 1933, as amended.
“ PikCo Registrable Securities ” means the Registrable Securities acquired by, issued or issuable to, or otherwise owned by PikCo and its Affiliates.
2. Demand Registrations.
(a) Requests for Registration . Subject to this Section 2, the Holders of a majority of the PikCo Registrable Securities may request registration, whether underwritten or otherwise, under the Securities Act of all or part of their Registrable Securities on Form S-1, Form F-1 or any similar long-form registration (“ Long-Form Registrations ”) or on Form S-3 or Form F-3 or any similar short-form registration (“ Short-Form Registrations ”), if available. All registrations requested pursuant to this Section 2 and any underwritten offerings with respect thereto, are referred to herein as “ Demand Registrations ”. Each request for a Long-Form Registration or Short-Form Registration shall specify the approximate number of Registrable Securities requested to be registered and the anticipated per share price range for such offering. Within twenty (20) days after receipt of any such request for a Long-Form Registration or Short-Form Registration, the Company will give written notice of such requested registration to all other Holders and will include (subject to the provisions of this Agreement including clause (d) below) in such registration (and in all related registrations or qualifications under blue sky laws or in compliance with other registration requirements and in any related underwriting) all Registrable Securities with respect to which the Company has received written requests for inclusion therein within five (5) days after the receipt of the Company’s notice. Each Holder agrees that such Holder shall treat as confidential the receipt of the notice of Demand Registration and shall not disclose or use the information contained in such notice of Demand Registration without the prior written consent of the Company until such time as the information contained therein is or becomes available to the public generally, other than as a result of disclosure by the Holder in breach of the terms of this agreement.
(b) Long-Form Registrations . The Holders of a majority of the PikCo Registrable Securities will be entitled to request unlimited Long-Form Registrations in which the Company will pay all Registration Expenses. A registration will not count as the permitted Long-Form Registration until it has become effective and unless the holders of PikCo Registrable Securities, are able to register and sell at least 90% of the PikCo Registrable Securities requested to be included in such registration; it being understood and agreed that the requisite Holders of PikCo Registrable Securities making a request for a Demand Registration hereunder may withdraw from such registration at any time prior to the effective date of such Demand Registration, in which case such request will not count as one of the permitted Demand Registrations for such Holders, irrespective of whether or not such registration is effected.
(c) Short-Form Registrations . The Holders of a majority of the PikCo Registrable Securities will be entitled to request an unlimited number of Short-Form Registrations in which the Company will pay all Registration Expenses. Demand Registrations will be Short-Form Registrations whenever the Company is permitted to use any applicable short form and if the managing underwriters (if any) agree to the use of a Short Form Registration. After the Company has become subject to the reporting requirements of the Exchange Act, the Company will use its best efforts to make Short-Form Registrations available for the sale of Registrable Securities.
 
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(d) Shelf Registration .
(i) Subject to the availability of required financial information, as promptly as practicable after the Company receives written notice of a request for a Shelf Registration, the Company shall file with the Securities and Exchange Commission a registration statement under the Securities Act for the Shelf Registration (a “ Shelf Registration Statement ”). The Company shall use its reasonable best efforts to cause any Shelf Registration Statement to be declared effective under the Securities Act as soon as practicable after the initial filing of such Shelf Registration Statement, and once effective, the Company shall cause such Shelf Registration Statement to remain continuously effective for such time period as is specified in such request, but for no time period longer than the period ending on the earliest of (A) the third anniversary of the date of filing of such Shelf Registration, (B) the date on which all Registrable Securities covered by such Shelf Registration have been sold pursuant to the Shelf Registration, and (C) the date as of which there are no longer any Registrable Securities covered by such Shelf Registration in existence.
(ii) In the event that a Shelf Registration Statement is effective, the holders of a majority of the Registrable Securities covered by such Shelf Registration Statement shall have the right at any time or from time to time to elect to sell pursuant to an offering (including an underwritten offering (an “ Underwritten Takedown ”)) Registrable Securities available for sale pursuant to such registration statement (“ Shelf Registrable Securities ”), so long as the Shelf Registration Statement remains in effect, and the Company shall pay all Registration Expenses in connection therewith. The holders of a majority of the Registrable Securities covered by such Shelf Registration Statement shall make such election by delivering to the Company a written request (a “ Shelf Offering Request ”) for such offering specifying the number of Shelf Registrable Securities that the holders desire to sell pursuant to such offering (the “ Shelf Offering ”). As promptly as practicable, but no later than two Business Days after receipt of a Shelf Offering Request, the Company shall give written notice (the “ Shelf Offering Notice ”) of such Shelf Offering Request to all other holders of Shelf Registrable Securities. The Company, subject to Sections 2(e) and 8 hereof, shall include in such Shelf Offering the Shelf Registrable Securities of any other holder of Shelf Registrable Securities that shall have made a written request to the Company for inclusion in such Shelf Offering (which request shall specify the maximum number of Shelf Registrable Securities intended to be disposed of by such Holder) within five days after the receipt of the Shelf Offering Notice. The Company shall, as expeditiously as possible (and in any event within 20 days after the receipt of a Shelf Offering Request, unless a longer period is agreed to by the holders of a majority of the Registrable Securities that made the Shelf Offering Request), use its reasonable best efforts to facilitate such Shelf Offering. Each Holder agrees that such Holder shall treat as confidential the receipt of the Shelf
 
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Offering Notice and shall not disclose or use the information contained in such Shelf Offering Notice without the prior written consent of the Company until such time as the information contained therein is or becomes available to the public generally, other than as a result of disclosure by the Holder in breach of the terms of this Agreement.
(iii) Notwithstanding the foregoing, if the holders of a majority of the PiKCo Registrable Securities wish to engage in an underwritten block trade off of a Shelf Registration Statement (either through filing an Automatic Shelf Registration Statement or through a take-down from an already existing Shelf Registration Statement), then notwithstanding the foregoing time periods, such Holders only need to notify the Company of the block trade Shelf Offering two Business Days prior to the day such offering is to commence (unless a longer period is agreed to by the holders of a majority of the PikCo Registrable Securities wishing to engage in the underwritten block trade) and the Company shall promptly notify other holders of Registrable Securities and such other holders of Registrable Securities must elect whether or not to participate by the next Business Day (i.e., one Business Day prior to the day such offering is to commence) (unless a longer period is agreed to by the holders of a majority of the PikCo Registrable Securities wishing to engage in the underwritten block trade) and the Company shall as expeditiously as possible use its reasonable best efforts to facilitate such offering (which may close as early as three Business Days after the date it commences); provided that the holders of a majority of the PikCo Registrable Securities shall use commercially reasonable efforts to work with the Company and the underwriters prior to making such request in order to facilitate preparation of the registration statement, prospectus and other offering documentation related to the underwritten block trade.
(iv) The Company shall, at the request of the holders of a majority of the Registrable Securities covered by a Shelf Registration Statement, file any prospectus supplement or, if the applicable Shelf Registration Statement is an Automatic Shelf Registration Statement, any post-effective amendments and otherwise take any action necessary to include therein all disclosure and language deemed necessary or advisable by the holders of a majority of the Registrable Securities to effect such Shelf Offering.
(e) Priority on Demand Registrations and Shelf Offerings . The Company will not include in any Demand Registration or Shelf Offering any securities which are not Registrable Securities without the prior written consent of the Holders of at least a majority of the PikCo Registrable Securities included in such registration (which consent shall be at their sole discretion). If a Demand Registration or a Shelf Offering is an underwritten offering and the managing underwriters advise the Company in writing that in their opinion the number of Registrable Securities and, if permitted hereunder, other securities requested to be included in such offering exceeds the number of Registrable Securities and other securities, if any, which can be sold therein without adversely affecting the marketability, proposed offering price, timing or method of distribution of the offering, the Company will include in such registration, subject to the first sentence of this clause (e), (i) first, the number of PikCo Registrable Securities requested
 
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to be included in such registration which, in the opinion of such underwriters, can be sold without any such adverse effect, pro rata , if necessary, among the Holders based on the number of PikCo Registrable Securities requested to be included therein by each such Holder of PikCo Registrable Securities, and (ii) second, any other securities of the Company requested to be included in such registration which, in the opinion of such underwriters, can be sold without any such adverse effect, pro rata , if necessary, on the basis of the number of shares of such other securities requested to be included therein by each such Holder.
(f) Restrictions on Demand Registrations and Shelf Offerings .
(i) The Company shall not be obligated to effect any Demand Registration within 90 days after the effective date of a previous Demand Registration or a previous registration in which Registrable Securities were included pursuant to Section 3 and in which there was no reduction in the number of Registrable Securities requested to be included. The Company may, with the consent of the holders of a majority of the Registrable Securities, postpone, for up to 60 days from the date of the request, the filing or the effectiveness of a registration statement for a Demand Registration or suspend the use of a prospectus that is part of a Shelf Registration Statement for up to 60 days from the date of the Suspension Notice (as defined below) and therefore suspend sales of the Shelf Registrable Securities (such period, the “ Suspension Period ”) by providing written notice to the holders of Registrable Securities if (A) the Company’s board of directors determines in its reasonable good faith judgment that the offer or sale of Registrable Securities would reasonably be expected to have a material adverse effect on any proposal or plan by the Company or any of its subsidiaries to engage in any material acquisition of assets or stock (other than in the ordinary course of business) or any material merger, consolidation, tender offer, recapitalization, reorganization or other transaction involving the Company and (B) upon advice of counsel, the sale of Registrable Securities pursuant to the registration statement would require disclosure of non-public material information not otherwise required to be disclosed under applicable law, and (C) (x) the Company has a bona fide business purpose for preserving the confidentiality of such transaction or (y) disclosure would have a material adverse effect on the Company or the Company’s ability to consummate such transaction; provided that in such event, the holders of Registrable Securities shall be entitled to withdraw such request for a Demand Registration or underwritten Shelf Offering and the Company shall pay all Registration Expenses in connection with such Demand Registration or Shelf Offering. The Company may delay a Demand Registration hereunder only once in any twelve-month period, except with the consent of the holders of a majority of the Registrable Securities. The Company also may extend the Suspension Period for an additional consecutive 60 days with the consent of the holders of a majority of the Registrable Securities, which consent shall not be unreasonably withheld, conditioned or delayed.
(ii) In the case of an event that causes the Company to suspend the use of a Shelf Registration Statement as set forth in paragraph (f)(i) above or pursuant
 
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to Section 5(e) (a “ Suspension Event ”), the Company shall give a notice to the holders of Registrable Securities registered pursuant to such Shelf Registration Statement (a “ Suspension Notice ”) to suspend sales of the Registrable Securities and such notice shall state generally the basis for the notice and that such suspension shall continue only for so long as the Suspension Event or its effect is continuing. A Holder shall not affect any sales of the Registrable Securities pursuant to such Shelf Registration Statement (or such filings) at any time after it has received a Suspension Notice from the Company and prior to receipt of an End of Suspension Notice (as defined below). Each Holder agrees that such Holder shall treat as confidential the receipt of the Suspension Notice and shall not disclose or use the information contained in such Suspension Notice without the prior written consent of the Company until such time as the information contained therein is or becomes available to the public generally, other than as a result of disclosure by the Holder in breach of the terms of this Agreement. The Holders may recommence effecting sales of the Registrable Securities pursuant to the Shelf Registration Statement (or such filings) following further written notice to such effect (an “ End of Suspension Notice ”) from the Company, which End of Suspension Notice shall be given by the Company to the Holders and to the Holders’ counsel, if any, promptly following the conclusion of any Suspension Event and its effect.
(iii) Notwithstanding any provision herein to the contrary, if the Company shall give a Suspension Notice with respect to any Shelf Registration Statement pursuant to this Section 2(f), the Company agrees that it shall extend the period of time during which such Shelf Registration Statement shall be maintained effective pursuant to this Agreement by the number of days during the period from the date of receipt by the Holders of the Suspension Notice to and including the date of receipt by the Holders of the End of Suspension Notice and provide copies of any supplemented or amended prospectus necessary to resume sales, with respect to each Suspension Event; provided that such period of time shall not be extended beyond the date that there are no longer Registrable Securities covered by such Shelf Registration Statement.
(g) Selection of Underwriters . In the case of a Demand Registration, subject to Section 2(d)(iii) above, the Holders of a majority of the PikCo Registrable Securities included in such Demand Registration will have the right to select the investment banker(s) and manager(s) to administer the offering, which investment banker(s) and manager(s) will be nationally recognized and reasonably acceptable to the Company.
(h) Other Registration Rights . Except as provided in this Agreement, the Company will not grant to any Persons the right to request the Company to register any equity securities of the Company, without the prior written consent of a majority of the Holders of PikCo Registrable Securities.
 
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3. Piggyback Registrations.
(a) Right to Piggyback . Whenever the Company proposes to register or offer pursuant to a registration statement any of its Ordinary Shares in an underwritten offering under the Securities Act other than pursuant to (i) a Demand Registration (which will be governed by Section 2 above), or (ii) pursuant to a registration statement on Form S-8, S-4, F-4 or any similar or successor form, and the registration form to be used may be used for the registration of Registrable Securities (a “ Piggyback Registration ”), the Company will give prompt written notice to all Holders of its intention to effect such a registration or underwriting and will, subject to the provisions of this Agreement including clauses (c) and (d) below, include in such registration or underwriting (and in all related registrations or qualifications under blue sky laws or in compliance with other registration requirements and in any related underwriting) all Registrable Securities with respect to which the Company has received written requests for inclusion therein within five (5) days after the receipt of the Company’s notice thereof.
(b) Priority on Primary Registrations . If a Piggyback Registration is an underwritten primary registration on behalf of the Company, the Company will include in such registration all securities requested to be included in such registration; provided , that if the managing underwriters advise the Company in writing that in their opinion the number of securities requested to be included in such registration exceeds the number which can be sold in such offering without adversely affecting the marketability, proposed offering price, timing or method of distribution of the offering, the Company will include in such registration (i) first, the securities the Company proposes to sell, (ii) second, the number of PikCo Registrable Securities which, in the opinion of such underwriters, can be sold without any such adverse effect, (iii) third, the number of Registrable Securities requested to be included in such registration by the other Holders, which, in the opinion of such underwriters, can be sold without any such adverse effect, if necessary pro rata among the Holders on the basis of the number of such Registrable Securities requested to be included therein by such Holder, and (iv) fourth, other securities, if any, requested to be included in such registration which, in the opinion of such underwriters, can be sold without any such adverse effect.
(c) Priority on Secondary Registrations . If a Piggyback Registration is an underwritten secondary registration on behalf of Holders of the Company’s securities (which registration was granted in accordance with Section 2(h) above), the Company will include in such registration all securities requested to be included in such registration; provided , that if the managing underwriters advise the Company in writing that in their opinion the number of securities requested to be included in such registration exceeds the number which can be sold in such offering without adversely affecting the marketability, proposed offering price, timing or method of distribution of the offering, the Company will include in such registration (i) first, the securities requested to be included therein by the holders initially requesting such registration which, in the opinion of the underwriters, can be sold without any such adverse effect, pro rata among the holders of such securities on the basis of the number of securities owned by such holder, (ii) second, the Registrable Securities requested to be included in such registration which, in the opinion of the underwriters, can be sold without any such adverse effect, pro rata among the Holders of such securities on the basis of the number of securities owned by such Holder, and (iii) third, other securities requested to be included in such registration which, in the opinion of the underwriters, can be sold without any such adverse effect.
 
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(d) Selection of Underwriters . In case of a Piggyback Registration that is an underwritten offering, the Company will have the right to select the investment banker(s) and manager(s) to administer the offering, which investment banker(s) and manager(s) will be nationally recognized and reasonably acceptable to the Holders of a majority of the PikCo Registrable Securities included in such Piggyback Registration.
(e) Obligations of Seller . During such time as any Holder may be engaged in a distribution of securities pursuant to an underwritten Piggyback Registration, such Holder shall distribute any Registrable Securities held by such Holder only under the registration statement and solely in the manner described in the registration statement.
(f) Right to Terminate Registration . The Company shall have the right to terminate or withdraw any registration initiated by it under this Section 3 whether or not any holder of Registrable Securities has elected to include securities in such registration. The Registration Expenses of such withdrawn registration shall be borne by the Company in accordance with Section 6.
4. Holdback Agreements.
(a) In connection with all underwritten Demand Registrations and underwritten Piggyback Registrations other than the Company’s initial public offering, no Holder shall effect any such transfer, make any short sale of, grant any option for the purchase of, or enter into any hedging or similar transaction with the same economic effect as a sale (including sales pursuant to Rule 144) of any equity securities of the Company, or any securities convertible into or exchangeable or exercisable for any such equity securities for such period of time prior to and after (x) the effective date of such registration, or (y) the date of the offering document use, as the underwriters managing the offering require in their sole discretion (each a “ Following Holdback Period ”), except as part of such underwritten registration, provided that such time period shall not extend beyond 90 days after the pricing of the offering. The Company may impose stop-transfer instructions with respect to the Ordinary Shares (or other securities) subject to the foregoing restriction until the end of such period.
(b) The Company (i) shall not effect any public sale or distribution of its equity securities, or any securities convertible into or exchangeable or exercisable for such securities, during such period of time as may be required by the underwriters managing such underwritten registration following the effective date of any underwritten Demand Registration or any underwritten Piggyback Registration, and (ii) shall cause each holder of at least 5% (on a fully-diluted basis) of its Ordinary Shares, or any securities convertible into or exchangeable or exercisable for Ordinary Shares, purchased from the Company at any time after the date of this Agreement (other than in a registered public offering) to agree not to effect any public sale or distribution (including sales pursuant to Rule 144) of any such securities during such period, except as part of such underwritten registration, if otherwise permitted, unless the underwriters managing the registered public offering otherwise agree in writing.
 
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5. Registration Procedures . Whenever the Holders have requested that any Registrable Securities be registered pursuant to this Agreement, the Company will use its best efforts to effect the registration and the sale of such Registrable Securities in accordance with the intended method of disposition thereof, and pursuant thereto the Company will as expeditiously as possible:
(a) in accordance with the Securities Act and all applicable rules and regulations promulgated thereunder, prepare and file with the Securities and Exchange Commission a registration statement, and all amendments and supplements thereto and related prospectuses, with respect to such Registrable Securities and use its best efforts to cause such registration statement to become effective (provided that before filing a registration statement or prospectus or any amendments or supplements thereto, the Company will furnish to one counsel selected by the Holders of a majority of the Registrable Securities covered by such registration statement copies of all such documents proposed to be filed), which documents shall be subject to the review and comment of such counsel, and include in any Short-Form Registration such additional information reasonably requested by a majority of the Registrable Securities registered under the applicable registration statement, or the underwriters, if any, for marketing purposes, whether or not required by applicable securities laws;
(b) notify each Holder of the effectiveness of each registration statement filed hereunder and prepare and file with the Securities and Exchange Commission such amendments and supplements to such registration statement and the prospectus used in connection therewith as may be necessary to keep such registration statement effective for the lesser of (x) 180 days and (y) such shorter period which will terminate when all Registrable Securities covered by the registration statement have been sold and comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such registration statement during such period in accordance with the intended methods of disposition by the sellers thereof set forth in such registration statement;
(c) furnish to each seller of Registrable Securities thereunder such number of copies of such registration statement, each amendment and supplement thereto, the prospectus included in such registration statement (including each preliminary prospectus), each Free Writing Prospectus and such other documents as such seller may reasonably request in order to facilitate the disposition of the Registrable Securities owned by such seller;
(d) use its best efforts to register or qualify such Registrable Securities under such other securities or blue sky laws of such jurisdictions as any seller reasonably requests and do any and all other acts and things which may be reasonably necessary or advisable to enable such seller to consummate the disposition in such jurisdictions of the Registrable Securities owned by such seller (provided that the Company will not be required to (i) qualify generally to do business in any jurisdiction where it would not otherwise be required to qualify but for this subsection, (ii) subject itself to taxation in any such jurisdiction or (iii) consent to general service of process ( i.e ., service of process which is not limited solely to securities law violations) in any such jurisdiction);
(e) notify each seller of such Registrable Securities, (i) promptly after it receives notice thereof, of the date and time when such registration statement and each post-effective amendment thereto has become effective or a prospectus or supplement to any prospectus relating to a registration statement has been filed and when any registration or qualification has become effective under a state securities or blue sky law or any exemption
 
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thereunder has been obtained, (ii) promptly after receipt thereof, of any request by the Securities and Exchange Commission for the amendment or supplementing of such registration statement or prospectus or for additional information, and (iii) at any time when a prospectus relating thereto is required to be delivered under the Securities Act, of the happening of any event as a result of which the prospectus included in such registration statement contains an untrue statement of a material fact or omits any fact necessary to make the statements therein not misleading, and, at the request of any such seller, the Company will promptly prepare a supplement or amendment to such prospectus so that, as thereafter delivered to the purchasers of such Registrable Securities, such prospectus will not contain an untrue statement of a material fact or omit to state any fact necessary to make the statements therein not misleading;
(f) prepare and file promptly with the Securities and Exchange Commission, and notify such Holders prior to the filing of, such amendments or supplements to such registration statement or prospectus as may be necessary to correct any statements or omissions if, at the time when a prospectus relating to such securities is required to be delivered under the Securities Act, when any event has occurred as the result of which any such prospectus or any other prospectus as then in effect would include an untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading, and, in case any of such Holders or any underwriter for any such Holders is required to deliver a prospectus at a time when the prospectus then in circulation is not in compliance with the Securities Act or the rules and regulations promulgated thereunder, the Company shall use its best efforts to prepare promptly upon request of any such Holder or underwriter such amendments or supplements to such registration statement and prospectus as may be necessary in order for such prospectus to comply with the requirements of the Securities Act and such rules and regulations;
(g) cause all such Registrable Securities to be listed on each securities exchange on which similar securities issued by the Company are then listed;
(h) provide a transfer agent and registrar for all such Registrable Securities not later than the effective date of such registration statement;
(i) enter into and perform such customary agreements (including underwriting agreements in customary form) and take all such other actions as the Holders of a majority of the Registrable Securities being sold or the underwriters, if any, reasonably request in order to expedite or facilitate the disposition of such Registrable Securities (including, without limitation, effecting a share split or a combination of share);
(j) make available at reasonable times for inspection by any seller of Registrable Securities, any underwriter participating in any disposition pursuant to such registration statement and any attorney, accountant or other agent retained by any such seller or underwriter, all financial and other records, pertinent corporate documents and properties of the Company, and cause the Company’s officers, directors, employees and independent accountants to supply all information reasonably requested by any such seller, underwriter, attorney, accountant or agent in connection with such registration statement subject to the applicable person(s) executing a nondisclosure agreement in reasonable form and substance if reasonably required by the Company;
 
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(k) make available for inspection by any seller of Registrable Securities, any underwriter participating in any disposition pursuant to such registration statement and any attorney, accountant or other agent retained by any such seller or underwriter, all financial and other records, pertinent corporate documents and properties of the Company, and cause the Company’s officers, directors, employees and independent accountants to supply all information reasonably requested by any such seller, underwriter, attorney, accountant or agent in connection with such registration statement;
(l) otherwise use its reasonable best efforts to comply with all applicable rules and regulations of the Securities and Exchange Commission, and make available to its security holders, as soon as reasonably practicable, an earning statement covering the period of at least twelve months beginning with the first day of the Company’s first full calendar quarter after the effective date of the registration statement, which earning statement shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder;
(m) permit any Holder which Holder, in its sole and exclusive judgment, might be deemed to be an underwriter or a controlling person of the Company, to participate in the preparation of such registration or comparable statement and to require the insertion therein of material, furnished to the Company in writing, which in the reasonable judgment of such Holder and its counsel should be included;
(n) use its best efforts to prevent the issuance of any stop order suspending the effectiveness of a registration statement, or of any order suspending or preventing the use of any related prospectus or suspending the qualification of any Ordinary Shares included in such registration statement for sale in any jurisdiction, and in the event of the issuance of any such stop order or other such order the Company shall advise such Holders of such stop order or other such order promptly after it shall receive notice or obtain knowledge thereof and shall use its best efforts promptly to obtain the withdrawal of such order;
(o) use its reasonable best efforts to cause such Registrable Securities covered by such registration statement to be registered with or approved by such other governmental agencies or authorities as may be necessary to enable the sellers thereof to consummate the disposition of such Registrable Securities;
(p) cooperate with each holder of Registrable Securities covered by the registration statement and each underwriter or agent participating in the disposition of such Registrable Securities and their respective counsel in connection with any filings required to be made with FINRA;
(q) use its reasonable best efforts to make available the executive officers of the Company to participate with the holders of Registrable Securities and any underwriters in any “road shows” or other selling efforts that may be reasonably requested by the Holders in connection with the methods of distribution for the Registrable Securities;
(r) in the case of any underwritten, use its reasonable best efforts to obtain a “cold comfort” letter from the Company’s independent public accountants in customary form and covering such matters of the type customarily covered by “cold comfort” letters as the Holders being sold reasonably request;
 
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(s) if Registrable Securities are to be sold in an Underwritten Offering, to include in the registration statement to be used, or in the case of a Shelf Registration, the prospectus supplement to be used, all such information as may be reasonably requested by the underwriters for the marketing and sale of such Registrable Securities; and
(t) provide a legal opinion of one (or more if requested by the underwriters in such offering) of the Company’s outside counsel, dated the effective date of such registration statement (and, if such registration includes an underwritten public offering, dated the date of the closing under the underwriting agreement), with respect to the registration statement, each amendment and supplement thereto, the prospectus included therein (including the preliminary prospectus) and such other documents relating thereto in customary form and covering such matters of the type customarily covered by legal opinions of such nature;
(u) if the Company files an Automatic Shelf Registration Statement covering any Registrable Securities, use its reasonable best efforts to remain a WKSI (and not become an ineligible issuer (as defined in Rule 405 under the Securities Act)) during the period during which such Automatic Shelf Registration Statement is required to remain effective;
(v) if the Company does not pay the filing fee covering the Registrable Securities at the time an Automatic Shelf Registration Statement is filed, pay such fee at such time or times as the Registrable Securities are to be sold; and
(w) if the Automatic Shelf Registration Statement has been outstanding for at least three (3) years, at the end of the third year, file a new Automatic Shelf Registration Statement covering the Registrable Securities, and, if at any time when the Company is required to re-evaluate its WKSI status the Company determines that it is not a WKSI, use its reasonable best efforts to refile the Shelf Registration Statement on Form S-3 and, if such form is not available, Form S-1 and keep such registration statement effective during the period during which such registration statement is required to be kept effective.
If any such registration or comparable statement refers to any Holder by name or otherwise as the holder of any securities of the Company and if, in its sole and exclusive judgment, such Holder is or might be deemed to be a controlling person of the Company, such Holder shall have the right to require (i) the insertion therein of language, in form and substance satisfactory to such Holder and presented to the Company in writing, to the effect that the holding by such Holder of such securities is not to be construed as a recommendation by such Holder of the investment quality of the Company’s securities covered thereby and that such holding does not imply that such Holder will assist in meeting any future financial requirements of the Company, or (ii) in the event that such reference to such Holder by name or otherwise is not required by the Securities Act or any similar Federal statute then in force, the deletion of the reference to such Holder; provided , that with respect to this clause (ii) such Holder shall furnish to the Company an opinion of counsel to such effect, which opinion and counsel shall be reasonably satisfactory to the Company.
 
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6. Registration Expenses . All expenses incident to the Company’s performance of or compliance with this Agreement, including without limitation all registration, qualification and filing fees, fees and expenses of compliance with securities or blue sky laws, printing expenses, messenger and delivery expenses, fees and disbursements of custodians, and fees and disbursements of counsel for the Company and any and all counsel chosen by the Holders of a majority of the PikCo Registrable Securities and all independent certified public accountants, underwriters (excluding underwriting discounts and commissions) and other Persons retained by the Company and the expenses related to any “Road Show” for an underwritten offering, including travel, meals and lodging (all such expenses being herein called “ Registration Expenses ”), shall be borne by the Company. For the avoidance of doubt, the Company shall pay its internal expenses (including, without limitation, all salaries and expenses of its officers and employees performing legal or accounting duties), the expense of any annual audit or quarterly review, the expense of any liability insurance and the expenses and fees for listing the securities to be registered on each securities exchange on which similar securities issued by the Company are then listed. Notwithstanding anything contained herein, each Person that sells securities pursuant to a Demand Registration or Piggyback Registration hereunder shall bear and pay all underwriting discounts and commissions applicable to the securities sold for such Person’s account.
7. Indemnification.
(a) The Company agrees to indemnify and hold harmless, to the extent permitted by law, each Holder, its partners, members, officers, directors, employees, agents and representatives and each Person who controls such Holder (within the meaning of the Securities Act) against all losses, claims, damages, liabilities and expenses arising out of or based upon any untrue or alleged untrue statement of material fact contained in any registration statement, prospectus or preliminary prospectus or any amendment thereof or supplement thereto or any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, and shall reimburse such Holder, partners, members, director, officer or controlling person for any legal or other expenses reasonably incurred by such Holder, partner, member, director, officer, employee, agent, representative or controlling person in connection with the investigation or defense of such loss, claim, damage, liability or expense, except insofar as the same are caused by or contained in any information furnished in writing to the Company by such Holder expressly for use therein or by such Holder’s failure to deliver a copy of the registration statement or prospectus or any amendments or supplements thereto after the Company has furnished such Holder with a sufficient number of copies of the same. In connection with an underwritten offering, the Company will indemnify such underwriters, their officers and directors and each Person who controls such underwriters (within the meaning of the Securities Act) to the same extent as provided above with respect to the indemnification of the Holders.
(b) In connection with any registration statement in which a Holder is participating, each such Holder will furnish to the Company in writing such information and affidavits as the Company reasonably requests for use in connection with any such registration statement or prospectus and, to the extent permitted by law, will (i) indemnify the Company, its directors and officers and each Person who controls the Company (within the meaning of the Securities Act) against any losses, claims, damages, liabilities and expenses resulting from any
 
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untrue or alleged untrue statement of material fact relating to such Holder and provided by such Holder to the Company or the Company’s agent contained in the registration statement, prospectus or preliminary prospectus or any amendment thereof or supplement thereto or any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, but only to the extent that such untrue statement or omission is contained in, or based upon, any information or affidavit so furnished in writing by such Holder; provided , that the obligation to indemnify will be individual, not joint and several, to each Holder and will be limited to the net amount of proceeds received by such Holder from the sale of Registrable Securities pursuant to such registration statement, and (ii) reimburse the Company, its directors and officers and each Person who controls the Company (within the meaning of the Securities Act) for any legal or other expenses reasonably incurred by such Persons in connection with the investigation or defense of such loss, claim, damage, liability or expense, except insofar as the same are caused by or contained in any information furnished to such Holder by such Persons expressly for use therein. In connection with an underwritten offering in which a Holder is participating, each such Holder will indemnify such underwriters, their officers and directors and each Person who controls such underwriters (within the meaning of the Securities Act) to the same extent as provided above with respect to the indemnification of the Company, its directors and officers and each Person who controls the Company (within the meaning of the Securities Act).
(c) Any Person entitled to indemnification hereunder will (i) give prompt written notice to the indemnifying party of any claim with respect to which it seeks indemnification (provided that failure to give such notice shall not affect the right of such Person to indemnification hereunder unless such failure is prejudicial to the indemnifying party’s ability to defend such claim) and (ii) unless in such indemnified party’s reasonable judgment a conflict of interest between such indemnified and indemnifying parties may exist with respect to such claim, permit such indemnifying party to assume the defense of such claim with counsel reasonably satisfactory to the indemnified party. If such defense is assumed, the indemnifying party will not be subject to any liability for any settlement made by the indemnified party without its prior written consent (but such consent will not be unreasonably withheld). An indemnifying party who is not entitled to, or elects not to, assume the defense of a claim will not be obligated to pay the fees and expenses of more than one counsel for all parties indemnified by such indemnifying party with respect to such claim, unless in the reasonable judgment of any indemnified party a conflict of interest may exist between such indemnified party and any other of such indemnified parties with respect to such claim.
(d) The indemnification provided for under this Agreement will remain in full force and effect regardless of any investigation made by or on behalf of the indemnified party or any officer, director or controlling Person of such indemnified party and will survive the transfer of securities. The Company and each Holder also agree to make such provisions, as are reasonably requested by any indemnified party, for contribution to such party in the event the indemnification provided for herein is unavailable for any reason.
(e) If the indemnification provided for in this Section 7 is held by a court of competent jurisdiction to be unavailable to an indemnified party or is otherwise unenforceable with respect to any loss, claim, damage, liability or action referred to herein, then the indemnifying party, in lieu of indemnifying such indemnified party hereunder, shall contribute to
 
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the amounts paid or payable by such indemnified party as a result of such loss, claim, damage, liability or action in such proportion as is appropriate to reflect the relative fault of the indemnifying party on the one hand and of the indemnified party on the other hand in connection with the statements or omissions which resulted in such loss, claim, damage, liability or action as well as any other relevant equitable considerations; provided that the maximum amount of liability in respect of such contribution shall be limited, in the case of each seller of Registrable Securities, to an amount equal to the net proceeds actually received by such seller from the sale of Registrable Securities effected pursuant to such registration. The relative fault of the indemnifying party and of the indemnified party shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission to state a material fact relates to information supplied by the indemnifying party or by the indemnified party and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The parties hereto agree that it would not be just or equitable if the contribution pursuant to this Section 7(e) were to be determined by pro rata allocation or by any other method of allocation that does not take into account such equitable considerations. The amount paid or payable by an indemnified party as a result of the losses, claims, damages, liabilities or expenses referred to herein shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending against any action or claim which is the subject hereof. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who is not guilty of such fraudulent misrepresentation.
(f) No indemnifying party shall, except with the consent of the indemnified party, consent to the entry of any judgment or enter into any settlement that does not include as an unconditional term thereof giving by the claimant or plaintiff to such indemnified party of a release from all liability in respect to such claim or litigation.
(g) Notwithstanding the foregoing, to the extent that the provisions on indemnification and contribution contained in the underwriting agreement entered into in connection with an underwritten public offering conflict with the foregoing provisions, the provisions in the underwriting agreement shall control, unless such provisions expressly state otherwise.
8. Participation in Underwritten Registrations .
(a) No Person may participate in any registration hereunder which is underwritten unless such Person (i) agrees to sell such Person’s securities on the basis provided in any underwriting arrangements approved by the Person or Persons entitled hereunder to approve such arrangements (including pursuant to any over-allotment or “green shoe” option requested by the underwriters, provided that no Holder shall be required to sell more than the number of Registrable Securities such Holder has requested to include) and (ii) completes and executes all customary questionnaires, powers of attorney, indemnities, underwriting agreements, lockup agreements and other documents reasonably required under the terms of such underwriting arrangements; provided , that no Holder included in any underwritten registration shall be required to make any representations or warranties to the Company or the underwriters other than representations and warranties regarding such Holder and such Holder’s intended
 
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method of distribution. Each Holder agrees to execute and deliver such other agreements as may be reasonably requested by the Company and the lead managing underwriter(s) that are consistent with such Holder’s obligations under Section 4 or that are necessary to give further effect thereto
(b) Price and Underwriting Discounts . In the case of an underwritten Demand Registration or Underwritten Takedown requested by Holders pursuant to this Agreement, the price, underwriting discount and other financial terms of the related underwriting agreement for the Registrable Securities shall be determined by the Holders of a majority of the Registrable Securities included in such underwritten offering.
(c) Suspended Distributions . Each Person that is participating in any registration under this Agreement, upon receipt of any notice from the Company of the happening of any event of the kind described in Section 5(e), shall immediately discontinue the disposition of its Registrable Securities pursuant to the registration statement until such Person’s receipt of the copies of a supplemented or amended prospectus as contemplated by Section 5(e). In the event the Company has given any such notice, the applicable time period set forth in Section 5(b) during which a Registration Statement is to remain effective shall be extended by the number of days during the period from and including the date of the giving of such notice pursuant to this Section 8(c) to and including the date when each seller of Registrable Securities covered by such registration statement shall have received the copies of the supplemented or amended prospectus contemplated by Section 5(e).
9. Rule 144 Reporting . With a view to making available to the Holders the benefits of certain rules and regulations of the Securities and Exchange Commission which may permit the sale of the Registrable Securities to the public without registration, the Company agrees to use its best efforts to:
(a) make and keep current public information available, within the meaning of Rule 144 or any similar or analogous rule promulgated under the Securities Act, at all times after it has become subject to the reporting requirements of the Exchange Act;
(b) file with the Securities and Exchange Commission, in a timely manner, all reports and other documents required of the Company under the Securities Act and Exchange Act (after it has become subject to such reporting requirements); and
(c) so long as any party hereto owns any Registrable Securities, furnish to such Person forthwith upon request, a written statement by the Company as to its compliance with the reporting requirements of said Rule 144 (at any time commencing ninety (90) days after the effective date of the first registration statement filed by the Company for an offering of its securities to the general public), the Securities Act and the Exchange Act (at any time after it has become subject to such reporting requirements); a copy of the most recent annual or quarterly report of the Company; and such other reports and documents as such Person may reasonably request in availing itself of any rule or regulation of the Securities and Exchange Commission allowing it to sell any such securities without registration.
 
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(d) The Company shall cooperate with the Holders in any sale and or transfer of Registrable Securities including by means not involving a registration statement.
10. Notices . All notices, demands or other communications to be given or delivered under or by reason of the provisions of this Agreement will be in writing and will be deemed to have been given when delivered personally, mailed by certified or registered mail, return receipt requested and postage prepaid, or sent via a nationally recognized overnight courier, or sent via facsimile to the recipient accompanied by a certified or registered mailing. Such notices, demands and other communications will be sent to the applicable parties hereto at such address or to the attention of such other person as is specified in the Company’s books and records or such other address or to the attention of such other Person as the recipient party shall have specified by prior written notice to the sending party.
11. Miscellaneous .
(a) No Inconsistent Agreements . The Company will not enter into any agreement which is inconsistent with or violates the rights granted to the Holders in this Agreement.
(b) Remedies . Any Person having rights under any provision of this Agreement will be entitled to enforce such rights specifically to recover damages caused by reason of any breach of any provision of this Agreement and to exercise all other rights granted by law. The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and that any party may in its sole discretion apply to any court of law or equity of competent jurisdiction (without posting any bond or other security) for specific performance and for other injunctive relief in order to enforce or prevent violation of the provisions of this Agreement.
(c) Amendments and Waivers . Except as otherwise provided herein, no modification, amendment or waiver to or of this Agreement or any provision hereof shall be effective against the Company or the other Persons party hereto unless such modification, amendment or waiver is approved in writing by the Company and the Holders of not less than a majority of the Registrable Securities. Notwithstanding anything to the contrary, no modification, amendment or waiver to or of this Agreement or any provision hereof that adversely affects the rights or obligations hereunder of any particular Holder or group of Holders while not similarly affecting the rights or obligations hereunder of all Holders shall be effective against such Holder or group of Holders unless approved in writing by such Holder or the Holders of a majority of the Registrable Securities held by such group of Holders, as the case may be. The failure of any party to enforce any of the provisions of this Agreement shall in no way be construed as a waiver of such provisions and shall not affect the right of such party thereafter to enforce each and every provision of this Agreement in accordance with its terms.
(d) Successors and Assigns . All covenants and agreements in this Agreement by or on behalf of any of the parties hereto will bind and inure to the benefit of the respective successors and assigns of the parties hereto whether so expressed or not. In addition, whether or not any express assignment has been made, the provisions of this Agreement which are for the benefit of purchasers or Holders are also for the benefit of, and enforceable by, any subsequent Holder.
 
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(e) Severability . Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be prohibited by or invalid under applicable law, such provision will be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of this Agreement.
(f) Counterparts . This Agreement may be executed simultaneously in two or more counterparts, any one of which need not contain the signatures of more than one party, but all such counterparts taken together will constitute one and the same Agreement.
(g) GOVERNING LAW . ALL QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY AND INTERPRETATION OF THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE DOMESTIC LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR CONFLICT OF LAW PROVISION OR RULE (WHETHER OF THE STATE OF NEW YORK OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF NEW YORK.
(h) Time is of the Essence; Computation of Time . Time is of the essence for each and every provision of this Agreement. Whenever the last day for the exercise of any privilege or the discharge of any duty hereunder shall fall upon a Saturday, Sunday, or any date on which banks in New York, New York are authorized to be closed, the party having such privilege or duty may exercise such privilege or discharge such duty on the next succeeding day which is a Business Day.
(i) Descriptive Headings . The descriptive headings of this Agreement are inserted for convenience only and do not constitute a part of this Agreement.
 
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IN WITNESS WHEREOF, the parties hereto have executed this Registration Rights Agreement as of the date first above written.

ATENTO S.A.	
		
By:	 	 	
Name:	 		
Title:	 		
	
ATALAYA LUXCO PIKCO S.C.A.	
		
By:	 	 	
Name:	 		
Title:	 		
 
19

			
[OTHER INVESTORS]	
		
By:	 	 	
Name:	 		
Title:	 		
 
20

Exhibit 10.14
CONSULTING SERVICES AND INFORMATION RIGHTS AGREEMENT
This Consulting Services and Information Rights Agreement (this “ Agreement ”) is made and entered into as of                  , 2014 by and between Atento S.A., a société anonyme incorporated and existing under the laws of the Grand Duchy of Luxembourg (the “ Company ”) on the one hand, and Bain Capital Europe, LLP and Portfolio Company Advisors Europe, LLP, each a limited liability partnership incorporated under the laws of England and Wales (and its successors and assigns) (the “ Consultants ”), on the other hand.
The parties hereto agree that this Agreement shall be deemed to take effect as from the termination of the Consulting Services Agreement, dated as of December 12, 2012 (the “ Effective Date ”).
WHEREAS, Consulting Services (as defined herein) have since the Effective Date been rendered by the Consultants to the Company, its Subsidiaries and Affiliates (each Subsidiary and Affiliate, a “ Beneficiary Affiliate ” and, together, the “ Beneficiary Affiliates ”) pursuant to the terms hereof and the Company hereby confirms its retention of the Consultants, and the Consultants confirm their wish to be retained, to provide the Consulting Services to the Company and to each of the Beneficiary Affiliates as required during the Term (defined below) and any extension thereof;
WHEREAS, the parties wish to establish a framework agreement to outline the terms of their overall relationship; and
NOW, THEREFORE, in consideration of the promises and mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Agreement hereby agree as follows:
1. Term . This Agreement shall be in effect for an initial term commencing on the Effective Date and ending on the third anniversary of the Effective Date (the “ Term ”), which initial term shall be automatically extended thereafter on a year-to-year basis unless the parties agree otherwise at least ninety (90) days prior to the expiration of the Term or any extension thereof. Notwithstanding anything to the contrary in this Agreement, this Agreement may be terminated prior to expiration of the Term or any extension thereof upon (i) a willful material breach of this Agreement by a party which is not cured within thirty (30) days of receipt of a written notice from the other party requiring cure, (ii) written agreement of the Company and the Consultants, or (iii) the Consultants delivering a written termination notice to the Company. The provisions of Section 6 to Section 19 (inclusive) shall survive any termination of this Agreement.
2. Consulting Services . The Consultants have performed and may perform certain consulting services, as further described below (collectively, the “ Consulting Services ”), for the benefit of the Company and/or the Beneficiary Affiliates. The Consulting Services may include, without limitation, support and advice in connection with the following and services of the following categories:
(a) general executive services;
(b) business development services;

(c) finance related services, including assistance in the preparation of financial projections;
(d) marketing, including monitoring of ongoing marketing plans and strategies;
(e) operations and project management;
(f) human resources including searching for and hiring of executives, other than in respect of specific transactions;
(g) advice relating to the restructuring of the businesses of the Company and/or any Beneficiary Affiliate; and
(h) other services for the Company and/or the Beneficiary Affiliates or their respective Subsidiaries upon which the Company, the Beneficiary Affiliates, and the Consultant agree.
Legal services have not been and will not be provided by the Consultants. The Consulting Services have been and will be conducted in support of the members of management and boards of directors of the Company and the Beneficiary Affiliates and, for the avoidance of doubt, the Consulting Services shall be considered provided by outside consultants and not managers of the Company and/or any of the Beneficiary Affiliates. The Consultant shall not have any authority or power to commit the Company and/or any Beneficiary Affiliate to any contract with any third party pursuant to this Agreement.
Subject to Section 3 and Section 8 , the Consulting Services shall be provided free-of-charge.
3. Consulting Expenses .
In consideration for the performance of the Consulting Services, the Company hereby agrees to pay (or to procure that one or more of the Beneficiary Affiliates shall pay), the following expenses.
(a) The Company shall pay to the Consultants (or, at the Consultant’s request, its designee(s)), all reasonable out-of-pocket expenses incurred by or on behalf of the Consultants and/or their Affiliates in rendering the Consulting Services, including irrecoverable VAT thereon (the “ Consulting Expenses ”).
(b) On the first Business Day of each calendar quarter the Company shall pay to the Consultants (or at the Consultant’s request, to the designee(s)) the Consulting Expenses incurred by the Consultants during the previous calendar quarter.
(c) Upon termination of this Agreement for any reason under Section 1 , the Company shall pay all amounts accrued but unpaid pursuant to this Agreement as of the
 
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date of such termination. Any amount payable pursuant to this Section 3(c) shall be paid no later than 31 January of the calendar year immediately following the calendar year in which this Agreement is terminated.
(d) All Consulting Expenses shall be paid by wire transfer in cash or other immediately available funds to the account(s) designated by the Consultants.
4. Recharge of Consulting Expenses and Other Matters . The Consultants acknowledge that the Company may recharge to the Beneficiary Affiliates such proportion of the Consulting Expenses as relates to the benefit provided to such Beneficiary Affiliates by the relevant Consulting Services. The Consultants shall, if requested, provide the Company and/or the Beneficiary Affiliates (as relevant) with such evidence as they may reasonably request of the Consulting Services provided for the benefit of the Company and/or such Beneficiary Affiliates (as the case may be).
5. Information Rights . The Company shall furnish to Consultants such financial information regarding the Company and its Affiliates as the Consultants may reasonably request, including monthly management reports and the annual budget, in each case as soon as practicable, and in any case, for the monthly management report, within 30 days of the end of the month.
(a) Each Consultant hereby acknowledges that (i) it is aware, and that it will advise each of its Affiliates and Consultant’s and its Affiliates’ respective representatives who are provided any Confidential Information (as defined in Section 6 hereof) of the Company, including the information provided pursuant to this Section 5 , that the U.S. securities laws prohibit any person who has received from an issuer material non-public information from purchasing or selling securities of such issuer or from communicating such information to any other person under circumstances in which it is reasonably foreseeable that such person is likely to purchase or sell such securities, and (ii) each Consultant is familiar with the Securities Exchange Act of 1934 (the “Exchange Act”) and the rules and regulations promulgated thereunder, and agrees that Consultant, its Affiliates and their respective representatives will not use, or communicate to any person under circumstances where it is reasonably likely that such person is likely to use or cause any person to use, any such information in contravention of the Exchange Act or any of its rules and regulations, including Rules 10b-5 and 14e-3.
6. Confidentiality .
(a) From and after the date hereof, each Consultant shall, and shall cause its Subsidiaries and controlled Affiliates to, maintain in confidence and use only in connection with its investment in the Company and for purposes of the business of the Company and its Subsidiaries, all Confidential Information. “Confidential Information” means all information concerning the Company or its Subsidiaries or the financial condition, business, operations or prospects of the Company or its Subsidiaries in the possession of or furnished to Consultant.
 
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(b) Each Consultant may disclose Confidential Information to its Subsidiaries, Affiliates, counsel, advisers, consultants, outside contractors, bankers, financing sources, and other agents, on the condition that such Persons agree to keep the Confidential Information confidential to the same extent as such disclosing party is required to keep the Confidential Information confidential, solely to the extent it is reasonably necessary or appropriate to fulfill its obligations or to exercise its rights under this Agreement; provided that the disclosing party shall remain liable with respect to any breach of this Section 6 by any such Subsidiaries, Affiliates, counsel, advisers, consultants, bankers, financing sources, outside contractors and other agents.
(c) Notwithstanding Section 6(a) or Section 6(b) above, each Consultant may disclose such Confidential Information (i) to the extent necessary or advisable in order to perform the Consulting Services hereunder, provided that the Person to which disclosure the Confidentiality Information is made is under a duty to maintain the confidentiality of such information, (ii) to the extent Consultant is legally compelled (by oral questions, interrogatories, request for information or documents, subpoena, civil investigative demand or similar process) to disclose any of the Confidential Information, (iii) for purposes of reporting to its members, partners or stockholders the performance of the Company and its Subsidiaries and for purposes of including applicable information in its financial statements, (iv) to the extent required to be disclosed by applicable law, rule or regulation; provided that in connection with any such disclosure (A) a disclosing party shall only disclose such Confidential Information as is required to be disclosed in connection with the foregoing, (B) to the extent reasonably practicable, a disclosing party shall provide the Company with prompt and advance written notice of any such intended disclosure so that the Company has a reasonable opportunity to limit such disclosure, or (if applicable, and to the extent reasonably practicable) seek a protective order or other appropriate remedy to prevent such disclosure, and (C) a disclosing party shall use its reasonable efforts to seek confidential treatment (consistent with the terms hereof) by the Person to whom such disclosure is made. Consultants acknowledge that money damages would not be a sufficient remedy for any breach of the provisions of this Section 6 and that the Company shall be entitled to equitable relief in a court of law in the event of, or to prevent, a breach or threatened breach of this Section 6 .
(d) The obligation not to disclose Confidential Information shall not apply to any part of such Confidential Information that (i) is or becomes patented, published, or otherwise part of the public domain other than by acts of Consultant in contravention of this Agreement, (ii) is disclosed to a Consultant by a third party, unless such Confidential Information was obtained by such third party directly or indirectly from Consultant hereto on a confidential basis, (iii) prior to disclosure under this Agreement, was already in the possession of a Consultant, unless such Confidential Information was obtained directly or indirectly from Consultant on a confidential basis, or (iv) is independently acquired or developed by a Consultant other than by acts of a Consultant in contravention of this Agreement.
7. Liability . Neither Consultant nor any of their Affiliates, partners, members, agents, advisors and controlling Persons (nor their respective directors, officers
 
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and employees) (collectively, the “ Consultant’s Group ”) shall be liable to any of the Company and/or any Beneficiary Affiliate for any Loss arising out of or in connection with the performance of the Consulting Services. Consultants make no representations or warranties, express or implied, in respect of the Consulting Services to be provided by any member of the Consultant’s Group. Except as Consultants may otherwise elect in writing after the date hereof: (a) each member of the Consultant’s Group shall have the right to, and shall have no duty (contractual or otherwise) not to, directly or indirectly (i) engage in the same or similar business activities or lines of business as the Company and the Beneficiary Affiliates or (ii) do business with any client or customer of the Company and the Beneficiary Affiliates; (b) no member of the Consultant’s Group shall be liable to the Company and/or any Beneficiary Affiliate for breach of any duty (contractual or otherwise) by reason of any of the activities referred to in the foregoing sub-section (a) or of such member’s participation therein; and (c) in the event that any member of the Consultant’s Group acquires knowledge of a potential transaction or matter that may be a constitute an opportunity (or potential opportunity) for the Company and/or any Beneficiary Affiliate, no member of the Consultant’s Group shall have any duty (contractual or otherwise) to communicate or present such corporate opportunity to the Company and/or any Beneficiary Affiliate, and, notwithstanding any provision of this Agreement to the contrary, no member of the Consultant’s Group shall be liable to the Company and/or any Beneficiary Affiliate for breach of any duty (contractual or otherwise) by reason of the fact that any member of the Consultant’s Group directly or indirectly pursues or acquires such opportunity for itself, directs such opportunity to another Person, or does not present such opportunity to the Company and/or any Beneficiary Affiliate. In no event will any member of the Consultant’s Group be liable to any of the Company and/or any Beneficiary Affiliate for any indirect, special, incidental or consequential damages, including lost profits or savings, whether or not such damages are foreseeable, or in respect of any liabilities relating to any third party claims (whether based in contract, tort or otherwise). This Section 7 does not limit or exclude any liability for fraud or any liability for a breach of Section 6 (Confidentiality) hereof.
8. Indemnity . In consideration of the execution and delivery of this Agreement by the Consultants, the Company shall indemnify, exonerate and hold each member of the Consultant’s Group (collectively, the “ Indemnitees ”), each of whom is an intended third party beneficiary of this Agreement and may specifically enforce the Company’s obligations hereunder (including but not limited to the obligations specified in this Section 8 ), free and harmless from and against any and all Loss arising from any Claim (collectively, the “ Indemnified Liabilities ”), incurred by the Indemnitees or any of them as a result of, arising out of, or in any way relating to the execution, delivery, performance, enforcement or existence of this Agreement or the Consulting Services, or non-performance by the Company, except for any such Indemnified Liabilities arising from such Indemnitee’s gross negligence, willful misconduct or breach of Section 6 (Confidentiality) hereof, and if and to the extent that the foregoing undertaking may be unavailable or unenforceable for any reason, the Company hereby agrees to make the maximum contribution to the payment and satisfaction of each of the Indemnified Liabilities that is permissible under applicable law. For purposes of this Section 8 , none of the circumstances described in the limitations contained in the immediately preceding sentence shall be deemed to apply absent a final non-appealable judgment of a court of
 
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competent jurisdiction to such effect, in which case to the extent any such limitation is so determined to apply to any Indemnitee as to any previously advanced indemnity payments made by the Company, then such payments shall be promptly repaid by such Indemnitee to the Company. The rights of any Indemnitee to indemnification hereunder will be in addition to any other rights any such Person may have under any other agreement or instrument referenced above or any other agreement or instrument to which such Indemnitee is or becomes a party or is or otherwise becomes a beneficiary or under law or regulation. The Company hereby agrees that the Company is the indemnitor of first resort (i.e., its obligations to Indemnitees under this Agreement are primary and any obligation of the Consultant (or any Affiliate thereof) to provide advancement or indemnification for the same Indemnified Liabilities (including all interest, assessments and other charges paid or payable in connection with or in respect of such Indemnified Liabilities) incurred by Indemnitees are secondary), and if the Consultant or any Affiliate thereof pays or causes to be paid, for any reason, any amounts otherwise indemnifiable hereunder or under any other indemnification agreement (whether pursuant to contract or constitutional documents) with any director or officer of the Company, then (i) the Consultant (or any such Affiliate, as the case may be) shall be fully subrogated to all rights of Indemnitee with respect to such payment and (ii) the Company shall reimburse the Consultant (or any such Affiliate, as the case may be) for the payments actually made and waives any right of subrogation, reimbursement, exoneration, contribution or indemnification and any right to participate in any Claim or remedy of any Indemnitee against any Indemnitee, whether such Claim, remedy or right arises in equity or under contract, statute, common law or otherwise, including any right to claim, take or receive from any Indemnitee, directly or indirectly, in cash or other property or by set-off or in any other manner, any payment or security or other credit support on account of such Claim, remedy or right.
9. Severability . Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal, or unenforceable in any respect under applicable law or rule in any jurisdiction, such invalidity, illegality, or unenforceability shall not effect the validity, legality, or enforceability of any other provision of this Agreement in such jurisdiction or affect the validity, legality, or enforceability of any provision in any other jurisdiction. Instead, this Agreement shall be reformed, construed and enforced in such jurisdiction as if such invalid, illegal, or unenforceable provision had never been contained herein.
10. Notices . All notices, demands or other communications to be given or delivered under or by reason of the provisions of this Agreement shall be in writing and shall be deemed to have been given (a) when delivered personally to the recipient, (b) when telecopied to the recipient (with hard copy sent to the recipient by internationally reputable overnight courier service (charges prepaid) that same day) if telecopied before 5:00 p.m., local time in the jurisdiction of recipient on a Business Day, and otherwise on the next Business Day, (c) two (2) Business Days after being sent to the recipient by internationally reputable overnight courier service (charges prepaid), or (d) by e-mail. Such notices, demands and other communications shall be sent to the parties hereto at the addresses set forth below.
 
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To the Company :
Atento S.A.
[ — ]

Facsimile:	  	 	[	— ] 	
E-mail:	  	 	[	— ] 	
Attention:	  	 	[	— ] 	
To the Consultants :
Bain Capital Europe, LLP
Devonshire House
Mayfair Place
London W1J 9AJ
UK
E-mail: mbethell@baincapital.com
Attention: Melissa Bethell
11. Certain Definitions . For purposes of this Agreement:
(a) “ Affiliate ” means, with respect to any Person, (i) any other Person which directly or indirectly through one or more intermediaries controls, or is controlled by, or is under common control with, such Person (for the purposes of this definition, “control” (including, with correlative meanings, the terms “controlling,” “controlled by” and “under common control with”), as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise), or (ii) if such Person or other Person is an investment fund, any other investment fund the primary investment advisor to which is the primary investment advisor to either Person or an Affiliate thereof;
(b) “ Agreement ” has the meaning set forth in the preamble;
(c) “ Beneficiary Affiliate ” and “ Beneficiary Affiliates ” have the meanings set forth in the preamble;
(d) “ Business Day ” means any day from Monday to Friday (inclusive) other than public bank holidays during normal working hours in New York, New York, United States of America, London, England, the Grand Duchy of Luxembourg and Spain;
(e) “ Claims ” means any action, claim, cause of action, suit or similar (excluding regarding taxes);
 
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(f) “ Company ” has the meaning set forth in the preamble;
(g) “ Confidential Information ” has the meaning set forth in Section 6 ;
(h) “ Consultant ” has the meaning set forth in the preamble;
(i) “ Consultant’s Group ” has the meaning set forth in Section 7 ;
(j) “ Consulting Expenses ” has the meaning set forth in Section 3(a);
(k) “ Consulting Services ” has the meaning set forth in Section 2 ;
(l) “ Effective Date ” has the meaning set forth in the preamble;
(m) “ Exchange Act ” has the meaning set forth in Section 5 ;
(n) “ Indemnitees ” has the meaning set forth in Section 8 ;
(o) “ Indemnified Liabilities ” has the meaning set forth in Section 8 ;
(p) “ Loss ” means losses, liabilities, damages, costs and/or expenses in connection therewith, including without limitation all reasonable attorneys’ fees, retainers, court costs, transcript costs, fees and costs of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, and all other disbursements or expenses of the types customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in, responding to a subpoena, or otherwise participating in, any proceeding including, but not limited to, litigation expenses incurred after the date on which none of the Consultant, its Affiliates or members of the Consultant’s Group, or associated investment funds own an interest in the Company, the premium for appeal bonds, attachment bonds or similar bonds and all interest, assessments and other charges paid or payable in connection with or in respect of any such expenses;
(q) “ Person ” means an individual, a partnership, a corporation, a limited liability company, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof;
(r) “ Subsidiary ” and “ Subsidiaries ” means, with respect to any Person, any corporation, limited liability company, partnership, association or other business entity of which (i) if a corporation, a majority of the total voting power of shares of stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof, or (ii) if a limited liability company, partnership, association or other business entity, a majority of the limited liability company, partnership or other similar ownership interest thereof is at the time owned or controlled, directly or
 
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indirectly, by any Person or one or more Subsidiaries of that Person or a combination thereof. For purposes hereof, a Person or Persons shall be deemed to have a majority ownership interest in a limited liability company, partnership, association or other business entity if such Person or Persons shall be allocated a majority of limited liability company, partnership, association or other business entity gains or losses or shall be or control the managing director or general partner of such limited liability company, partnership, association or other business entity;
(s) “ Tax ” means any tax, assessment or other central or local government charge of any nature whatsoever of any jurisdiction;
(t) “ Term ” has the meaning set forth in Section 1 ; and
(u) “ VAT ” means any value added, sales, turnover, consumption or similar Tax of any jurisdiction.
12. Assignment . No party may assign any obligations hereunder to any other Person without the prior written consent of the other party (which consent shall not be unreasonably withheld or delayed); provided that the Consultant may, without the consent of the Company, assign any of its rights and/or obligations under this Agreement to any member of the Consultant’s Group or to any of its affiliated investment funds, whereupon, in each case, the assignor nevertheless shall remain liable for the performance of its obligations hereunder.
13. Amendment and Waiver . Except as otherwise provided herein, no modification, amendment, or waiver of any provision of this Agreement shall be effective against any party hereto unless such modification, amendment, or waiver has been approved in writing by such party. No course of dealing or the failure of any party to enforce any of the provisions of this Agreement shall in any way operate as a waiver of such provisions and shall not affect the right of such party thereafter to enforce each and every provision of this Agreement in accordance with its terms.
14. Successors . This Agreement and all the obligations and benefits hereunder shall bind and inure to the benefit of and be enforceable by the parties hereto and the respective successors and assigns of each of them.
15. Contracts (Rights of Third Parties) Act 1999 . This Agreement does not confer any rights on any person under the Contracts (Rights of Third Parties) Act 1999, except that each Indemnitee is intended to benefit from the provisions of Section 8 , and may enforce those provisions under section 1 of the Contracts (Rights of Third Parties) Act 1999. This letter may be varied, rescinded or terminated by the parties without the consent of any person referred to in the preceding sentence
16. Counterparts . This Agreement may be executed in multiple counterparts, each of which shall be an original and all of which taken together shall constitute one and the same agreement.
 
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17. Entire Agreement . Except as otherwise expressly set forth herein, this Agreement embodies the complete agreement and understanding among the parties hereto with respect to the subject matter hereof and supersedes and preempts any prior understandings, agreements or representations by or among the parties, written or oral, which may have related to the subject matter hereof in any way.
18. Governing Law . This Agreement and any non-contractual obligations arising out of or in connection with it shall be governed and construed in accordance with the laws of England. Each party to this Agreement irrevocably agrees to submit to the exclusive jurisdiction of the courts of England over any claim or matter arising out of or in connection with this Agreement (including a dispute relating to any non-contractual obligation arising out of or in connection with this letter).
19. No Strict Construction . The language used in this Agreement shall be deemed to be the language chosen by the parties hereto to express their mutual intent, and no rule of strict construction shall be applied against any party.
* * * * *
 
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IN WITNESS WHEREOF, the parties hereto have executed this Consulting Services and Information Rights Agreement as of the date first written above.

ATENTO S.A.	
		
By:	 	 	
Name:	
Title:	

BAIN CAPITAL EUROPE, LLP	
		
By:	 	 	
Name:	
Title:	

PORTFOLIO COMPANY ADVISORS
EUROPE, LLP	
		
By:	 	 	
Name:	
Title:	
 
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Exhibit 10.15
INDEMNIFICATION AGREEMENT
This Indemnification Agreement (this “ Agreement ”) is made as of [                    ], 2014 by and between Atento S.A., a société anonyme incorporated and existing under the laws of the Grand Duchy of Luxembourg, having its registered office at 4, rue Lou Hemmer, L-1748 Luxembourg and being registered with the Luxembourg Trade and Companies’ Register under number B 185.761 (the “ Company ”), in its own name and on behalf of its direct and indirect subsidiaries, and [            ], an individual (“ Indemnitee ”).
RECITALS : 
WHEREAS , directors, officers, employees, controlling persons, fiduciaries and other agents (“ Representatives ”) in service to companies or business enterprises are being increasingly subjected to expensive and time-consuming litigation relating to, among other things, matters that traditionally would have been brought only against the company or business enterprise itself;
WHEREAS , highly competent persons have become more reluctant to serve as Representative unless they are provided with adequate protection through insurance and adequate indemnification against inordinate risks of claims and actions against them arising out of their service to and activities on behalf of the company or business enterprise;
WHEREAS , the board of directors of the Company (the “ Board ”) has determined that the increased difficulty in attracting and retaining highly competent persons is detrimental to the best interests of the Company and its shareholders and that the Company should act to assure such persons that there will be increased certainty of protection against inordinate risks of claims and actions against them arising out of their service to and activities on behalf of the Company;
WHEREAS , (a) the amended and restated articles of association of the Company as at [***] 2014 (the “ Articles of Association ”) requires indemnification of the officers and directors of the Company, (b) Indemnitee may also be entitled to indemnification pursuant to the the law of 10 August 1915 on commercial companies, as amended (the “ Luxembourg Law ”) and (c) the Articles of Association and the Luxembourg Law expressly provide that the indemnification provisions set forth therein are not exclusive and thereby contemplate that contracts may be entered into between the Company and its Representatives with respect to indemnification;
WHEREAS , this Agreement is a supplement to and in furtherance of the Articles of Association and any resolutions adopted pursuant thereto, and shall not be deemed a substitute therefore, nor to diminish or abrogate any rights of Indemnitee thereunder, and
WHEREAS , (a) Indemnitee does not regard the protection available under the Articles of Association and insurance as adequate in the present circumstances, (b) Indemnitee may not be willing to serve or continue to serve as a Representative without adequate protection, (c) the Company desires Indemnitee to serve in such capacity and (d) Indemnitee is willing to serve, continue to serve and to take on additional service for or on behalf of the Company on the condition that [he/she] be so indemnified.

AGREEMENT : 
NOW, THEREFORE , in consideration of the premises and the covenants contained herein, the Company and Indemnitee do hereby covenant and agree as follows:
Section 1. Definitions.
(a) As used in this Agreement:
“ Agreement ” shall have the meaning ascribed to such term in the Preamble hereto.
“ Articles of Association ” shall have the meaning ascribed to such term in the Recitals hereto.
“ Board ” shall have the meaning ascribed to such term in the Recitals hereto.
“ Company ” shall have the meaning ascribed to such term in the Preamble hereto.
“ Corporate Status ” describes the status of an individual who is or was a Representative of an Enterprise.
“ Enterprise ” shall mean the Company and any other Person, employee benefit plan, joint venture or other enterprise of which Indemnitee is or was serving at the request of the Company as a Representative.
“ Exchange Act ” shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder.
“ Expenses ” shall mean all reasonable costs, expenses, fees and charges, including, without limitation, attorneys’ fees, retainers, court costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, and all other disbursements or expenses of the types customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in, or otherwise participating in, a Proceeding. Expenses also shall include, without limitation, (i) expenses incurred in connection with any appeal resulting from, incurred by Indemnitee in connection with, arising out of, in respect of or relating to, any Proceeding, including, without limitation, the premium, security for, and other costs relating to any cost bond, supersedes bond, or other appeal bond or its equivalent, (ii) for purposes of Section 11(d) only, expenses incurred by Indemnitee in connection with the interpretation, enforcement or defense of Indemnitee’s rights under this Agreement, by litigation or otherwise, (iii) any federal, state, local or foreign taxes imposed on Indemnitee as a result of the actual or deemed receipt of any payments under this Agreement (on a grossed up basis) and (iv) any interest, assessments or other charges in respect of the foregoing.
“ Indemnitee ” shall have the meaning ascribed to such term in the Preamble hereto.
“ Indemnity Obligations ” shall mean all obligations of the Company to Indemnitee under this Agreement, including, without limitation, the Company’s obligations to provide indemnification to Indemnitee and advance Expenses to Indemnitee under this Agreement.
“ Independent Counsel ” shall mean a law firm, or a member of a law firm, that is experienced in matters of company law and neither presently is, nor in the past five (5) years has been, retained to represent: (i) the Company or Indemnitee in any matter material to either such party (other than with respect to matters concerning Indemnitee under this Agreement, or of other indemnitees under similar indemnification agreements)
 
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or (ii) any other party to the Proceeding giving rise to a claim for indemnification; provided , however , that the term “Independent Counsel” shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement.
“ Liabilities ” shall mean all claims, liabilities, damages, losses, judgments, orders, fines, penalties and other amounts payable in connection with, arising out of, in respect of or relating to or occurring as a direct or indirect consequence of any Proceeding, including, without limitation, amounts paid in whole or partial settlement of any Proceeding, all Expenses in complying with any judgment, order or decree issued or entered in connection with any Proceeding or any settlement agreement, stipulation or consent decree entered into or issued in settlement of any Proceeding, and any consequential damages resulting from any Proceeding or the settlement, judgment, or result thereof.
“ Luxembourg Law ” shall have the meaning ascribed to such term in the Recitals hereto.
“ Person ” shall mean any individual, company, partnership, limited partnership, limited liability company, trust, governmental agency or body or any other legal entity.
“ Proceeding ” shall mean any threatened, pending or completed action, claim, suit, arbitration, alternate dispute resolution mechanism, formal or informal hearing, inquiry or investigation, litigation, administrative hearing or any other actual, threatened or completed judicial, administrative or arbitration proceeding (including, without limitation, any such proceeding under the Securities Act of 1933, as amended, or the Exchange Act or any other federal law, state law, statute or regulation), whether brought in the right of the Company or otherwise, and whether of a civil, criminal, administrative or investigative nature, in which Indemnitee was, is or will be, or is threatened to be, involved as a party or witness or otherwise involved, affected or injured (i) by reason of the fact that Indemnitee is or was a Representative of the Company, (ii) by reason of any actual or alleged action taken by Indemnitee or of any action on Indemnitee’s part while acting as Representative of the Company or (iii) by reason of the fact that Indemnitee is or was serving at the request of the Company as a Representative of another Person, whether or not serving in such capacity at the time any liability or Expense is incurred for which indemnification, reimbursement, or advancement of Expenses can be provided under this Agreement.
“ Representative ” shall have the meaning ascribed to such term in the Preamble hereto.
“ Sponsor Entities ” shall mean the funds advised by Bain Capital Partners, LLC (“Bain Capital”) or any other Person controlling, controlled by or under common control with Bain Capital; provided , however , that neither the Company nor any of its subsidiaries shall be considered Sponsor Entities hereunder.
“ Submission Date ” shall have the meaning ascribed to such term in Section 9(b).
(b) For the purpose hereof, references to “fines” shall include any excise tax assessed with respect to any employee benefit plan; references to “serving at the request of the Company” shall include, without limitation, any service as a Representative of the Company which imposes duties on, or involves services by, such Representative with respect to an employee benefit plan, its participants or beneficiaries; and a Person who acted in good faith and in a manner he
 
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reasonably believed to be in the best interests of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in manner “not opposed to the best interests of the Company” as referred to in this Agreement.
Section 2. Indemnity in Third-Party Proceedings. The Company shall indemnify and hold harmless Indemnitee, to the fullest extent permitted by applicable law, from and against all Liabilities and Expenses suffered or incurred by Indemnitee or on Indemnitee’s behalf in connection with or as a consequence of any Proceeding (other than any Proceeding brought by or in the right of the Company to procure a judgment in its favor which shall be governed by the provisions set forth in Section 3 below) or any claim, issue or matter therein, if Indemnitee acted in good faith and in a manner he reasonably believed to be in, or not opposed to, the best interests of the Company and, in the case of a criminal proceeding, had no reasonable cause to believe that his conduct was unlawful. For the avoidance of doubt, a finding, admission or stipulation that an Indemnitee has acted with gross negligence or recklessness shall not, of itself, create a presumption that such Indemnitee has failed to meet the standard or conduct required for indemnification in this Section 2.
Section 3. Indemnity in Proceedings by or in the Right of the Company. The Company shall indemnify and hold harmless Indemnitee, to the fullest extent permitted by applicable law, from and against all Liabilities and Expenses suffered or incurred by Indemnitee or on Indemnitee’s behalf in connection with or as a consequence of any Proceeding brought by or in the right of the Company to procure a judgment in its favor, or any claim, issue or matter therein, if Indemnitee acted in good faith and in a manner he reasonably believed to be in, or not opposed, to the best interests of the Company. No indemnification for Liabilities and Expenses shall be made under this Section 3 in respect of any claim, issue or matter as to which Indemnitee shall have been finally adjudged by a court to be liable to the Company, unless and only to the extent that the [Luxembourg Court] or any court in which the Proceeding was brought shall determine upon application that, despite the adjudication of liability, but in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnification. For the avoidance of doubt, a finding, admission or stipulation that an Indemnitee has acted with gross negligence or recklessness shall not, of itself, create a presumption that such Indemnitee has failed to meet the standard or conduct required for indemnification in this Section 3.
Section 4. Indemnification for Expenses of a Party Who is Wholly or Partly Successful. Notwithstanding any other provisions of this Agreement, and without limiting the rights of Indemnitee under any other provision hereof, to the extent that (a) Indemnitee is a party to (or a participant in) any Proceeding, (b) the Company is not permitted by applicable law to indemnify Indemnitee with respect to any claim brought in such Proceeding if such claim is asserted successfully against Indemnitee and (c) Indemnitee is not wholly successful in such Proceeding, but is successful, on the merits or otherwise (including, without limitation, settlement thereof), as to one or more but less than all claims, issues or matters in such Proceeding, then the Company shall indemnify Indemnitee, to the fullest extent permitted by applicable law, against all Liabilities and Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf, in connection with or as a consequence of each successfully resolved claim, issue or matter. For purposes of this Section 4 and without limitation, the termination of any claim, issue or matter in such a Proceeding by settlement, entry of a plea of nolo contendere or by dismissal, with or without prejudice, shall be deemed to be a successful result as to such claim, issue or matter.
Section 5. Indemnification For Expenses of a Witness. Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of Indemnitee’s Corporate Status, a witness in any Proceeding to which Indemnitee is not a party, Indemnitee shall be indemnified to the fullest extent permitted by applicable law against all Liabilities and Expenses suffered or incurred by him or on his behalf in connection therewith.
 
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Section 6. Additional Indemnification. Notwithstanding any limitation in Sections 2, 3 or 4, the Company shall indemnify Indemnitee to the fullest extent permitted by applicable law if Indemnitee is a party to, or threatened to be made a party to, any Proceeding (including, without limitation, a Proceeding by or in the right of the Company to procure a judgment in its favor), against all Liabilities and Expenses suffered or incurred by Indemnitee in connection with such Proceeding:
(a) to the fullest extent permitted by the provision of the [Luxembourg Law] that authorizes or contemplates additional indemnification by agreement, or the corresponding provision of any amendment to, or replacement of, the [Luxembourg Law], and
(b) to the fullest extent authorized or permitted by any amendments to, or replacements of, the [Luxembourg Law]adopted after the date of this Agreement that increase the extent to which a company may indemnify its officers and directors.
Section 7. Advances of Expenses. In furtherance of the requirement of Article 25 of the Articles of Association shall have the meaning ascribed to such term in the Recitals hereto. and notwithstanding any provision of this Agreement to the contrary, the Company shall advance, to the fullest extent permitted by law, Expenses incurred by Indemnitee in connection with any Proceeding, and such advancement shall be made within ten (10) days after the receipt by the Company of a statement or statements requesting such advances from time to time, whether prior to, or after, final disposition of any Proceeding. Advances shall be unsecured and interest free. Advances shall be made without regard to Indemnitee’s ability to repay Expenses and without regard to Indemnitee’s ultimate entitlement to indemnification under the other provisions of this Agreement. Advances shall include any and all Expenses incurred pursuing an action to enforce this right of advancement, including, without limitation, Expenses incurred preparing and forwarding statements to the Company to support the advances claimed. Indemnitee shall qualify for advances upon the execution and delivery to the Company of this Agreement, which shall constitute an undertaking, providing that Indemnitee undertakes to repay the advance to the extent that it is ultimately determined that Indemnitee is not entitled to be indemnified by the Company.
Section 8. Procedure for Notification and Defense of Claim.
(a) Indemnitee shall notify the Company in writing of any Proceeding with respect to which Indemnitee intends to seek indemnification or advancement of Expenses hereunder as soon as reasonably practicable following the receipt by Indemnitee of written notice thereof. The written notification to the Company shall include a description of the nature of the Proceeding and the facts underlying the Proceeding. To obtain indemnification under this Agreement, Indemnitee shall submit to the Company a written request, including therein or therewith such documentation and information as is reasonably available to Indemnitee and is reasonably necessary to determine whether and to what extent Indemnitee is entitled to indemnification following the final disposition of such Proceeding. Any delay or failure by Indemnitee to notify the Company hereunder will not relieve the Company from any liability which it may have to Indemnitee hereunder or otherwise than under this Agreement, and any delay or failure in so notifying the Company shall not constitute a waiver by Indemnitee of any rights under this Agreement.
(b) In the event Indemnitee is entitled to indemnification and/or advancement of Expenses with respect to any Proceeding, Indemnitee may, at Indemnitee’s option, (i) retain legal counsel selected by Indemnitee and approved by the Company (which approval shall not to be unreasonably withheld, conditioned or delayed) to defend Indemnitee in such Proceeding, at the sole expense of the Company or (ii) have the Company assume the defense of Indemnitee in the Proceeding, in which case the Company shall assume the defense of such Proceeding with legal
 
5

counsel selected by the Company and approved by Indemnitee (which approval shall not be unreasonably withheld, conditioned or delayed) within ten (10) days of the Company’s receipt of written notice of Indemnitee’s election to cause the Company to do so. If the Company is required to assume the defense of any such Proceeding, it shall engage legal counsel for such defense, and shall be solely responsible for all Expenses of such legal counsel and otherwise of such defense. Such legal counsel may represent both Indemnitee and the Company (and/or any other party or parties entitled to be indemnified by the Company with respect to such matter) unless, in the reasonable opinion of legal counsel to Indemnitee, there is a conflict of interest between Indemnitee and the Company (or any other such party or parties) or there are legal defenses available to Indemnitee that are not available to the Company (or any such other party or parties). Notwithstanding either party’s assumption of responsibility for defense of a Proceeding, each party shall have the right to engage separate legal counsel at its own expense. The party having responsibility for defense of a Proceeding shall provide the other party and its legal counsel with all copies of pleadings and material correspondence relating to the Proceeding. Indemnitee and the Company shall reasonably cooperate in the defense of any Proceeding with respect to which indemnification is sought hereunder, regardless of whether the Company or Indemnitee assumes the defense thereof. Indemnitee may not settle or compromise any Proceeding without the prior written consent of the Company (which consent shall not be unreasonably withheld, conditioned or delayed). The Company may not settle or compromise any proceeding without the prior written consent of Indemnitee (which consent shall not be unreasonably withheld, conditioned or delayed).
Section 9. Procedure Upon Application for Indemnification.
(a) Upon written request by Indemnitee for indemnification pursuant to Section 8(a), the Company shall advance Expenses necessary to defend against a Claim pursuant to Section 7 hereof. If any determination by the Company is required by applicable law with respect to Indemnitee’s ultimate entitlement to indemnification, such determination shall be made (i) if Indemnitee shall request such determination be made by the Independent Counsel, by the Independent Counsel and (ii) in all other circumstances in any manner permitted by the [Luxembourg Law]. Indemnitee shall cooperate with the Person(s) making such determination with respect to Indemnitee’s entitlement to indemnification, including, without limitation, providing to such Person(s), upon reasonable advance request, any documentation or information which is not privileged or otherwise protected from disclosure and which is reasonably available to Indemnitee and reasonably necessary to such determination. Any Expenses incurred by Indemnitee in so cooperating with the Person(s) making such determination shall be borne by the Company (irrespective of the determination as to Indemnitee’s entitlement to indemnification) and the Company hereby indemnifies and agrees to hold Indemnitee harmless therefrom. The Company will not deny any written request for indemnification hereunder made in good faith by Indemnitee unless a determination as to Indemnitee’s entitlement to such indemnification described in this Section 9(a) has been made. The Company agrees to pay Expenses of the Independent Counsel referred to above and to fully indemnify the Independent Counsel against any and all Expenses, claims, liabilities and damages arising out of or relating to this Agreement or its engagement pursuant hereto.
(b) In the event that the determination of entitlement to indemnification is to be made by the Independent Counsel pursuant to Section 9(a) hereof, (i) the Independent Counsel shall be selected by the Company within ten (10) days of the Submission Date, (ii) the Company shall give written notice to Indemnitee advising it of the identity of the Independent Counsel so selected and (iii) Indemnitee may, within ten (10) days after such written notice of selection shall have been given, deliver to the Company Indemnitee’s written objection to such selection.
 
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Absent a timely objection, the Person so selected shall act as the Independent Counsel. If a timely objection is made by Indemnitee, the Person so selected may not serve as the Independent Counsel unless and until such objection is withdrawn. If no Independent Counsel shall have been selected (whether due to a failure of the Company to appoint such Independent Counsel, an un-withdrawn objection from Indemnitee with respect to the person so appointed or otherwise) before the later of (i) thirty (30) days after the submission by Indemnitee of a written request for indemnification pursuant to Section 9(a) hereof (the date of such submission, the “ Submission Date ”) and (ii) ten (10) days after the final disposition of the Proceeding for which indemnity is sought, then (x) each of the Company and Indemnitee shall select a Person meeting the qualifications to serve as the Independent Counsel and (y) such Persons shall (collectively) select the Independent Counsel. Upon the due commencement of any judicial proceeding or arbitration pursuant to Section 11(a) of this Agreement, the Independent Counsel shall be discharged and relieved of any further responsibility in such capacity (subject to the applicable standards of professional conduct then prevailing).
Section 10. Presumptions and Effect of Certain Proceedings.
(a) In making a determination with respect to entitlement to indemnification hereunder, the Person(s) making such determination shall, to the fullest extent permitted by law, presume that Indemnitee is entitled to indemnification under this Agreement if Indemnitee has submitted a request for indemnification in accordance with Section 8(a) of this Agreement, and the Company shall, to the fullest extent permitted by law, have the burden of proof to overcome that presumption in connection with the making by any Person(s) of any determination contrary to that presumption. Neither the failure of the Company (including, without limitation, by its directors or independent legal counsel) to have made a determination prior to the commencement of any action pursuant to this Agreement that indemnification is proper in the circumstances because Indemnitee has met the applicable standard of conduct, nor an actual determination by the Company (including, without limitation, by its directors or independent legal counsel) that Indemnitee has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that Indemnitee has not met the applicable standard of conduct.
(b) Subject to Section 11(e), if the Person(s) empowered or selected under Section 9 hereof to determine whether Indemnitee is entitled to indemnification shall not have made a determination within sixty (60) days after receipt by the Company of the request therefore, the requisite determination of entitlement to indemnification shall, to the fullest extent permitted by law, be deemed to have been made and Indemnitee shall be entitled to such indemnification, absent a prohibition of such indemnification under applicable law; provided , however , that such sixty (60) day period may be extended for a reasonable time, not to exceed an additional thirty (30) days, if (i) the determination is to be made by the Independent Counsel and Indemnitee objects to the Company’s selection of the Independent Counsel and (ii) the Independent Counsel ultimately selected requires such additional time for the obtaining or evaluating of documentation and/or information relating thereto.
(c) The termination of any Proceeding or of any claim, issue or matter therein, by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, shall not (except as otherwise expressly provided in this Agreement) adversely affect the right of Indemnitee to indemnification or create a presumption that Indemnitee did not act in good faith and in a manner which he reasonably believed to be in, or not opposed to, the best interests of the Company or, with respect to any criminal Proceeding, that Indemnitee had reasonable cause to believe that Indemnitee’s conduct was unlawful.
 
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(d) Effect of Settlement . To the fullest extent permitted by law, settlement of any Proceeding without any finding of responsibility, wrongdoing or guilt on the part of Indemnitee with respect to claims asserted in such Proceeding shall constitute a conclusive determination that Indemnitee is entitled to indemnification hereunder with respect to such Proceeding.
(e) Reliance as Safe Harbor . For purposes of any determination of good faith, Indemnitee shall be deemed to have acted in good faith if Indemnitee’s action is based on the records or books of account of the Enterprise, including financial statements, or on information supplied to Indemnitee by the officers of the Enterprise in the course of their duties, or on the advice of legal counsel for the Enterprise, or on information or records given or reports made to the Enterprise by an independent certified public accountant or by an appraiser or other expert selected with reasonable care by the Enterprise. The provisions of this Section 10(e) shall not be deemed to be exclusive or to limit in any way the other circumstances in which Indemnitee may be deemed to have met the applicable standard of conduct set forth in this Agreement.
(f) Actions of Others . The knowledge and/or actions, or failure to act, of any Representative (other than Indemnitee) of the Enterprise shall not be imputed to Indemnitee for purposes of determining the right to indemnification under this Agreement.
Section 11. Remedies of Indemnitee.
(a) Subject to Section 11(e), in the event that (i) a determination is made pursuant to Section 10 of this Agreement that Indemnitee is not entitled to indemnification under this Agreement, (ii) advancement of Expenses is not timely made pursuant to Section 7 of this Agreement, (iii) no determination of entitlement to indemnification shall have been made pursuant to Section 9(a) of this Agreement within ninety (90) days after the Submission Date, (iv) payment of indemnification is not made pursuant to Section 4, 5 or 9(a) of this Agreement within ten (10) days after receipt by the Company of a written request therefore, (v) payment of indemnification pursuant to Section 2, 3 or 6 of this Agreement is not made within ten (10) days after a determination has been made that Indemnitee is entitled to indemnification or (vi) in the event that the Company or any other person takes or threatens to take any action to declare this Agreement void or unenforceable, or institutes any litigation or other action or Proceeding designed to deny, or to recover from, Indemnitee, the benefits provided or intended to be provided to Indemnitee hereunder, Indemnitee shall be entitled to an adjudication by a court of Indemnitee’s entitlement to such indemnification and/or advancement of Expenses. Alternatively, Indemnitee, at Indemnitee’s option, may seek an award in arbitration to be conducted by a single arbitrator pursuant to the Commercial Arbitration Rules of the American Arbitration Association. The Company shall not oppose Indemnitee’s right to seek any such adjudication or award in arbitration.
(b) In the event that a determination shall have been made pursuant to Section 9(a) of this Agreement that Indemnitee is not entitled to indemnification, any judicial proceeding or arbitration commenced pursuant to this Section 11 shall be conducted in all respects as a de novo trial, or arbitration, on the merits and Indemnitee shall not be prejudiced by reason of that adverse determination. In any judicial proceeding or arbitration commenced pursuant to this Section 11, the Company shall have the burden of proving Indemnitee is not entitled to indemnification or advancement of Expenses, as the case may be.
(c) If a determination shall have been made pursuant to Section 9(a) of this Agreement that Indemnitee is entitled to indemnification, the Company shall be bound by such determination in any judicial proceeding or arbitration commenced pursuant to this Section 11,
 
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absent (i) a misstatement by the Indemnitee of a material fact, or an omission by the Indemnitee of a material fact necessary to make the Indemnitee’s statement not materially misleading, in connection with the request for indemnification, or (ii) a prohibition of such indemnification under applicable law.
(d) The Company shall, to the fullest extent permitted by law, be precluded from asserting in any judicial proceeding or arbitration commenced pursuant to this Section 11 that the procedures and presumptions of this Agreement are not valid, binding and enforceable and shall stipulate in any such court or before any such arbitrator that the Company is bound by all the provisions of this Agreement. It is the intent of the Company that Indemnitee not be required to incur legal fees or other Expenses associated with the interpretation, enforcement or defense of Indemnitee’s rights under this Agreement by litigation or otherwise because the cost and expense thereof would substantially detract from the benefits intended to be extended to Indemnitee hereunder. In addition, the Company shall indemnify Indemnitee against any and all such Expenses and, if requested by Indemnitee, shall (within ten (10) days after receipt by the Company of a written request therefore) advance, to the fullest extent permitted by law, such Expenses to Indemnitee, which are incurred by Indemnitee in connection with any action brought by Indemnitee for indemnification or advance of Expenses from the Company under this Agreement or under any directors’ and officers’ liability insurance policies maintained by the Company, regardless of whether Indemnitee ultimately is determined to be entitled to such indemnification, advancement of Expenses or insurance recovery, as the case may be.
(e) Notwithstanding anything in this Agreement to the contrary, no determination as to entitlement to indemnification under this Agreement shall be required to be made prior to the final disposition of the Proceeding; provided that , in absence of any such determination with respect to such Proceeding, the Company shall pay Liabilities and advance Expenses with respect to such Proceeding as if Indemnitee had been determined to be entitled to indemnification and advancement of Expenses with respect to such Proceeding.
Section 12. Non-Exclusivity; Survival of Rights; Insurance; Subrogation.
(a) The rights of indemnification and to receive advancement of Expenses as provided by this Agreement shall not be deemed exclusive of any other rights to which Indemnitee may at any time be entitled under applicable law, the Articles of Associations, any agreement, a vote of shareholders, a resolution of directors or otherwise. No amendment, alteration or repeal of this Agreement or of any provision hereof shall limit or restrict any right of Indemnitee under this Agreement in respect of any action taken or omitted by such Indemnitee in Indemnitee’s Corporate Status prior to such amendment, alteration or repeal. To the extent that a change in applicable law, whether by statute or judicial decision, permits greater indemnification or advancement of Expenses than would be afforded currently under the Articles of Association and/or this Agreement, it is the intent of the parties hereto that Indemnitee shall enjoy by this Agreement the greater benefits so afforded by such change. No right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right and remedy shall be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other right or remedy.
(b) The Company hereby acknowledges that Indemnitee may have certain rights to indemnification, advancement of Expenses and/or insurance provided by one or more Persons with whom or which Indemnitee may be associated (including, without limitation, any Sponsor
 
9

Entity). The Company hereby acknowledges and agrees that (i) the Company shall be the indemnitor of first resort with respect to any Proceeding, Expense, Liability or matter that is the subject of the Indemnity Obligations, (ii) the Company shall be primarily liable for all Indemnity Obligations and any indemnification afforded to Indemnitee in respect of any Proceeding, Expense, Liability or matter that is the subject of Indemnity Obligations, whether created by law, organizational or constituent documents, contract (including, without limitation, this Agreement) or otherwise, (iii) any obligation of any other Persons with whom or which Indemnitee may be associated (including, without limitation, any Sponsor Entity) to indemnify Indemnitee and/or advance Expenses to Indemnitee in respect of any proceeding shall be secondary to the obligations of the Company hereunder, (iv) the Company shall be required to indemnify Indemnitee and advance Expenses to Indemnitee hereunder to the fullest extent provided herein without regard to any rights Indemnitee may have against any other Person with whom or which Indemnitee may be associated (including, without limitation, any Sponsor Entity) or insurer of any such Person and (v) the Company irrevocably waives, relinquishes and releases any other Person with whom or which Indemnitee may be associated (including, without limitation, any Sponsor Entity) from any claim of contribution, subrogation or any other recovery of any kind in respect of amounts paid by the Company hereunder. In the event that any other Person with whom or which Indemnitee may be associated (including, without limitation, any Sponsor Entity) or their insurers advances or extinguishes any liability or loss which is the subject of any Indemnity Obligation owed by the Company or payable under any insurance policy provided under this Agreement, the payor shall have a right of subrogation against the Company or its insurer or insurers for all amounts so paid which would otherwise be payable by the Company or its insurer or insurers under this Agreement. In no event will payment of an Indemnity Obligation of the Company under this Agreement by any other Person with whom or which Indemnitee may be associated (including, without limitation, any Sponsor Entity) or their insurers, affect the obligations of the Company hereunder or shift primary liability for any Indemnity Obligation to any other Person with whom or which Indemnitee may be associated (including, without limitation, any Sponsor Entity). Any indemnification and/or insurance or advancement of Expenses provided by any other Person with whom or which Indemnitee may be associated (including, without limitation, any Sponsor Entity), with respect to any liability arising as a result of Indemnitee’s Corporate Status or capacity as an officer or director of any Person, is specifically in excess of any Indemnity Obligation of the Company or valid and any collectible insurance (including, without limitation, any malpractice insurance or professional errors and omissions insurance) provided by the Company under this Agreement, and any obligation to provide indemnification and/or insurance or advance Expenses provided by any other Person with whom or which Indemnitee may be associated (including, without limitation, any Sponsor Entity) shall be reduced by any amount that Indemnitee collects from the Company as an indemnification payment or advancement of Expenses pursuant to this Agreement.
(c) To the extent that the Company maintains an insurance policy or policies providing liability insurance for Representatives of the Company or of any other Enterprise, Indemnitee shall be covered by such policy or policies in accordance with its or their terms to the maximum extent of the coverage available for any such Representative under such policy or policies. If, at the time of the receipt of a notice of a claim pursuant to the terms hereof, the Company maintains an insurance policy or policies providing liability insurance for Representatives of the Company or of any other Enterprise, the Company shall give prompt notice of the commencement of such proceeding to the insurers in accordance with the procedures set forth in the respective policy or policies. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such policies.
 
10

(d) In the event of any payment under this Agreement, the Company shall not be subrogated to, and hereby waives any rights to be subrogated to, any rights of recovery of Indemnitee, including, without limitation, rights of indemnification provided to Indemnitee from any other Person or entity with whom Indemnitee may be associated (including, without limitation, any Sponsor Entity) as well as any rights to contribution that might otherwise exist; provided , however , that the Company shall be subrogated to the extent of any such payment of all rights of recovery of Indemnitee under insurance policies of the Company or any of its subsidiaries.
(e) The indemnification and contribution provided for in this Agreement will remain in full force and effect regardless of any investigation made by or on behalf of Indemnitee.
Section 13. Duration of Agreement; Not Employment Contract. This Agreement shall continue until and terminate upon the latest of: (a) ten (10) years after the date that Indemnitee shall have ceased to serve as a Representative of the Company or any other Enterprise and (b) one (1) year after the final termination of any Proceeding then pending in respect of which Indemnitee is granted rights of indemnification or advancement of Expenses hereunder and of any proceeding commenced by Indemnitee pursuant to Section 11 of this Agreement relating thereto. This Agreement shall be binding upon the Company and its successors and assigns and shall inure to the benefit of Indemnitee and Indemnitee’s heirs, executors and administrators. This Agreement shall not be deemed an employment contract between the Company (or any of its subsidiaries or any Enterprise) and Indemnitee. Indemnitee specifically acknowledges that Indemnitee’s employment with the Company (or any of its subsidiaries or any Enterprise), if any, is at will, and Indemnitee may be discharged at any time for any reason, with or without cause, except as may be otherwise provided in any written employment contract between Indemnitee and the Company (or any of its subsidiaries or any Enterprise), other applicable formal severance policies duly adopted by the Board, or, with respect to service as a Representative of the Company, by the Articles of Association and the [Luxembourg Law].
Section 14. Severability. If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever: (a) the validity, legality and enforceability of the remaining provisions of this Agreement (including, without limitation, each portion of any Section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and shall remain enforceable to the fullest extent permitted by law; (b) such provision or provisions shall be deemed reformed to the extent necessary to conform to applicable law and to give the maximum effect to the intent of the parties hereto; and (c) to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any Section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested thereby.
Section 15. Enforcement.
(a) The Company expressly confirms and agrees that it has entered into this Agreement and assumed the obligations imposed on it hereby in order to induce Indemnitee to serve as a Representative of the Company, and the Company acknowledges that Indemnitee is relying upon this Agreement in serving as a Representative of the Company.
(b) This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral, written and implied, between the parties hereto with respect to the subject matter hereof; provided , however , that this Agreement is a supplement to and in furtherance of the Articles of Association and applicable law, and shall not be deemed a substitute therefore, nor to diminish or abrogate any rights of Indemnitee thereunder.
 
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Section 16. Modification and Waiver. No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by the parties thereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions of this Agreement nor shall any waiver constitute a continuing waiver. The failure of any party to enforce any of the provisions of this Agreement shall in no way be construed as a waiver of such provisions and shall not affect the right of such party thereafter to enforce each and every provision of this Agreement in accordance with its terms.
Section 17. Notices. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed to have been duly given if (a) delivered by hand and receipted for by the party to whom said notice or other communication shall have been directed, (b) mailed by certified or registered mail with postage prepaid, on the third business day after the date on which it is so mailed, (c) mailed by reputable overnight courier and receipted for by the party to whom said notice or other communication shall have been directed or (d) sent by facsimile transmission, with receipt of oral confirmation that such transmission has been received:
(a) If to Indemnitee, at the address indicated on the signature page of this Agreement, or such other address as Indemnitee shall provide to the Company.
(b) If to the Company to:
Atento S.A.
Santiago de Compostela 94, 9ª planta
Madrid 28035
Spain
Fax: +34 917407403
Attention: Chief Financial Officer and Legal and Regulatory Compliance
Director
with copies to (which shall not constitute notice to the Company):
Kirkland & Ellis LLP
601 Lexington Avenue
New York, NY 10022
United States of America
Fax: (212) 446-6460
Attention: Joshua N. Korff, Esq. and
                    Christopher A. Kitchen, Esq.
or to any other address as may have been furnished to Indemnitee by the Company.
Section 18. Contribution. To the fullest extent permissible under applicable law, if the indemnification provided for in this Agreement is unavailable to Indemnitee for any reason whatsoever, the Company, in lieu of indemnifying Indemnitee, shall contribute to the amount incurred by Indemnitee, whether for judgments, fines, penalties, excise taxes, amounts paid or to be paid in settlement and/or for Expenses, in connection with any claim relating to an indemnifiable event under this Agreement, in such proportion as is deemed fair and reasonable in light of all of the circumstances of the Proceeding in order to reflect (a) the relative benefits received by the Company and Indemnitee as a result of the event(s) and/or transaction(s) giving cause to such Proceeding; and/or (b) the relative fault of the Company (and its directors, officers, employees and agents) and Indemnitee in connection with such event(s) and/or transaction(s).
 
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Section 19. Applicable Law and Consent to Jurisdiction. This Agreement and the legal relations among the parties shall be governed by, and construed and enforced in accordance with, the laws of the [Grand Duchy of Luxembourg], without regard to its conflict of laws rules. The Company and Indemnitee hereby irrevocably and unconditionally (a) agree that any action or proceeding arising out of or in connection with this Agreement shall be brought only in the [Luxembourg court], and not in any other state or federal court in the United States of America or any court in any other country, (b) consent to submit to the exclusive jurisdiction of the [Luxembourg court] for purposes of any action or proceeding arising out of or in connection with this Agreement, (c) waive any objection to the laying of venue of any such action or proceeding in the [Luxembourg court] and (d) waive, and agree not to plead or to make, any claim that any such action or proceeding brought in the [Luxembourg court] has been brought in an improper or inconvenient forum. [Arendt to suggest proper venue]
Section 20. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall for all purposes be deemed to be an original but all of which together shall constitute one and the same Agreement. Only one such counterpart signed by the party against whom enforceability is sought needs to be produced to evidence the existence of this Agreement.
Section 21. Third-Party Beneficiaries. The Sponsor Entities are intended third-party beneficiaries of this Agreement.
Section 22. Miscellaneous. Use of the masculine pronoun shall be deemed to include usage of the feminine pronoun where appropriate. The headings of the paragraphs of this Agreement are inserted for convenience only and shall not be deemed to constitute part of this Agreement or to affect the construction thereof.
[SIGNATURE PAGE FOLLOWS]
 
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IN WITNESS WHEREOF, the parties have caused this Agreement to be signed as of the day and year first above written.

ATENTO S.A.	

Name:	 		
Title:	 	director and authorized signatory	
	
INDEMNITEE:	

[                ]	 		
 
[Signature Page to Indemnification Agreement]

Exhibit 21.1
Atento Group Post-Acquisition Structure

ATALAYA LUXCO MIDCO, S.à.r.l.	  	Luxembourg	
		
ATENTO LUXCO 1, S.A.	  	Luxembourg	
		
ATALAYA LUXCO 2, S.à.r.l.	  	Luxembourg	
		
ATALAYA LUXCO 3, S.à.r.l.	  	Luxembourg	
		
CENTRO DE CONTACTO SALTA, S.A.	  	Argentina	
		
ATENTO SPAIN HOLDCO, S.L.U.	  	Spain	
		
ATENTO SPAIN HOLDCO 4, S.A.U	  	Spain	
		
ATENTO BRASIL, S.A.	  	Brazil	
		
ATENTO SPAIN HOLDCO 5, S.L.U.	  	Spain	
		
ATENTO MEXICO HOLDCO, S. DE R.L. DE C.V.	  	Mexico	
		
ATENTO MEXICANA, SA de CV	  	Mexico	
		
CONTACT US TELESERVICES INC.	  	USA	
		
ATENTO ATENCIÓN Y SERVICIOS S.A. de CV	  	Mexico	
		
ATENTO SERVICIOS S.A. de CV	  	Mexico	
		
ATENTO CENTROAMÉRICA S.A.	  	Guatemala	
		
ATENTO GUATEMALA, S.A.	  	Guatemala	
		
ATENTO EL SALVADOR SA DE CV	  	El Salvador	
		
ATENTO DE PUERTO RICO, INC.	  	Puerto Rico	
		
ATENTO PANAMÁ, S.A.	  	Panama	
		
ATENTO CESKA REPUBLIKA, A.S.	  	Czech Republic	
		
ATENTO SPAIN HOLDCO 6, S.L.U.	  	Spain	
		
ATENTO SPAIN HOLDCO 2, S.A.U.	  	Spain	

			
		
GLOBAL ROSSOLIMO, S.L.U.	  	Spain	
		
ATENTO TELESERVICIOS ESPAÑA, S.A.U.	  	Spain	
		
ATENTO SERVICIOS TÉCNICOS Y CONSULTORÍA, S.A.U.	  	Spain	
		
ATENTO IMPULSA, S.A.U.	  	Spain	
		
ATENTO SERVICIOS AUXILIARES DE CONTACT CENTER, S.A.U.	  	Spain	
		
ATENTO MAROC, S.A.	  	Morocco	
		
ATENTO BV	  	Netherlands	
		
ATENTO HOLDING CHILE, S.A.	  	Chile	
		
ATENTO CHILE, S.A.	  	Chile	
		
ATENTO CENTRO DE FORMACIÓN TÉCNICA LIMITADA (CHILE)	  	Chile	
		
ATENTO EDUCACIÓN LIMITADA (CHILE)	  	Chile	
		
TELEATENTO DEL PERÚ, S.A.C.	  	Peru	
		
ATENTO COLOMBIA, S.A.	  	Colombia	
		
WOKNAL, S.A.	  	Uruguay	
 
2

Exhibit 23.1
Consent of Independent Registered Public Accounting Firm
We consent to the reference to our firm under the caption “Experts” and to the use of our reports dated April 30, 2014 with respect to the combined carve-out financial statements of Atalaya Luxco Midco Predecessor, and April 30, 2014 with respect to the consolidated financial statements of Atalaya Luxco Midco S.à.r.l. and subsidiaries, in the Registration Statement (Form F-1) and related Prospectus of Atento S.A. for the registration of ordinary shares.
Ernst & Young, S.L.
/s/ Carlos Hidalgo Andres
Carlos Hidalgo Andres
Madrid, Spain
September 12, 2014