2017 REGISTRATION DOCUMENT

BOURBON 2017 Registration Document 73 MANAGEMENT REPORT Risk factors 3 As a result, in the management’s opinion, to the best of its knowledge of the matter and of the local legal and tax environment, and supported by the opinion of its counsel, this is a contingent liability for which the likelihood of a significant payout is currently slight. These proceedings are mentioned in the notes to the consolidated financial statements (see section 3.20 on contingent liabilities) of this Registration Document. Apart from the proceedings described above, litigation for which provisions have already been recognized and/or those in which disclosure would be contrary to its legitimate interests, there are no other governmental, judicial or arbitration proceedings (including any pending or threatened proceedings, to the Company’s knowledge) that are likely to have or that have had in the last 12 months any material impact on the Group’s financial position or profitability. For each significant dispute, a provision has been established to meet the estimated risk if the probability of occurrence of that risk is considered to be high. Otherwise, no provision has been established. 5.4 ETHICAL AND NON-COMPLIANCE RISKS Unethical behavior and behavior which infringes anti-fraud, corruption or any other applicable legal provisions, is likely to expose BOURBON or its employees to criminal and civil penalties. Such events may damage the Group’s reputation and decrease the value of its shares. The Group’s policy is to conduct its activities with strict adherence to legal and ethical obligations as stated in the Group’s Compliance and Ethics Policy. In 2013, the Group decided to strengthen its policies, procedures and training with regard to ethics and compliance, especially anti- corruption. The Group has put in place a dedicated compliance program for all its entities. BOURBON’s compliance program is closely monitored and regularly updated to improve its effectiveness and to keep pace with regulatory change. The main measures used in this regard are outlined in the risk mapping part of the management report and in the “internal control and risk management procedures” section of the Chairman’s report. Because situations on the ground can be complex, BOURBON employees and stakeholders may need support in the application or interpretation of the Code of Conduct. BOURBON strengthened its ethical approach by providing its employees and stakeholders with an ethics alert line available 24/7 enabling anyone to report behavior contrary to the BOURBON Code of Conduct. 5.5 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICY The main risks to which the Group is exposed are credit/counterparty risks, liquidity risks and market risks. The Board of Directors has reviewed and approved the management policies of each of these risks. The policies are summarized below. 5.5.1 Credit/counterparty risk The Group’s policy is to verify the financial health of all customers seeking credit payment terms. Furthermore, the Group continually monitors client balances. The financial soundness of its clients enables BOURBON to avoid the use of COFACE-type credit insurance. Supermajor, major, national and independent oil companies account for nearly 65% of revenue. Nevertheless, the current crisis has impacted our customers, which has led to an increased risk of recoverability for certain receivables from smaller customers. The volume of business conducted with the top five clients represented €364 million (45.9% of revenue) while the top ten clients accounted for nearly 65.8% (€522 million). A statement of anteriority of credits and other debtors is presented in note 3.19.5. to the consolidated financial statements. In 2017, the portion of BOURBON’s revenue generated in countries at risk politically, such as Equatorial Guinea, Libya, and Myanmar, was very marginal (barely 1% of total revenue). Concerning the credit risk on the Group’s other financial assets, i.e . cash and cash equivalents, available-for-sale financial assets and certain derivative instruments, the Group works only with top-ranking banks, particularly with the major French banks, and pays particular attention to the choice of banking institutions. In addition, other counterparty risks are assessed on a case-by-case basis as part of long-term relationships maintained and encouraged by the Group, especially in view of the effects from the current crisis on certain local stakeholders to whom vendor loans were awarded during sales of vessels in past years. 5.5.2 Liquidity risks Financing comes under a Group policy implemented by the Finance and Administration Department. Historically, this policy consisted of financing the Group’s needs through a combination of operating cash flows, disposal of assets, bank borrowings and market transactions, and in the context of the industry downturn, through a strategy of cash flow preservation that led to redefining BOURBON’s financing platform for 2017 and the following years. To manage the cyclical downturn seen in the offshore oil and gas market, the Group undertook discussions with its financial partners in order to redefine its financing platform for the forthcoming years. These discussions resulted in the signature of an agreement on March 6, 2017 with a number of financial institutions and partners to restructure its principal debt in the amount of €910.8 million. At the same time as the negotiations that led to the restructuring of its principal debt, BOURBON also reached an agreement to reorganize lease payments on the vessels covered by the sale and bareboat chartering contracts concluded with ICBC Financing Leasing in 2013 and 2014. The agreement entered into with the Group’s principal financial partners – described in detail in the notes to the 2016 financial statements – thus restructured the repayments of its club deal loans, its bilateral loans, its finance leases, and its short-term loans, while also providing for a progressive increase in the loan margins over the extended payment schedule, as well as the granting of additional sureties.