1. LEANER MANAGEMENT

Running a multinational group is easy - if you have the right partner. Our innovative organisational business model allows you to distribute your services globally - smoothly, without any fuss.

A new legal framework

1. Following the takeover, your statutory rights and obligations as shareholder will be replaced with a single licensing agreement that will from then on govern all key aspects of our relationship.

2. All transactions with your remaining group members will be replaced with a single royalty payment unilaterally set by you every year.

3. Your local directors will remain in office - to continue to supervise the employees taken over and act as your dedicated points of contact with Technomorph CC.

Which is super light

1. The operations taken over will disappear from your balance sheet.  

2. Our unilateral royalty payment will be made directly to your licensing entity abroad. There will be no dividend to distribute, no loan to repay. 

3. Local laws and regulations will no longer apply directly to you. Your services will be distributed independently and transparently, with a much lower risk of political interferences.

And super flexible

1. Critically, you will always remain free to re-integrate the operations taken over into your group - unilaterally, for any reason.

2. Just as importantly, you will also remain free to amend the terms of our licensing agreement - unilaterally, at any time.

3. In the end, therefore, you will always retain full flexibility to determine not just what we do, but also how we do it. 

2. A fresh FOCUS ON INNOVATION

Our unilateral royalty payment is not just a remuneration. It is above all else an incentive mechanism. Which gives us the strongest incentive to exceed your expectations - and innovate. Thinking of something ? We'll think of something better.

HOW DOES IT WORK ?

Every year, you tell us how much profit you think we can make. That's your royalty payment. That's what you'll get. And if we do better, we'll keep the difference. Year after year, the same rule applies. You adjust your estimate and we try to beat it again. Naturally, we can only beat it if we innovate - which is what this unilateral royalty payment is all about.

In effect, we are both engaged in a virtuous circle, where you constantly adjust your expectations and we constantly seek to exceed them - all this in the endless pursuit of innovation.

MORE THAN THAT :

This unilateral royalty payment can be fixed or variable, positive or negative - it's all up to you. Most importantly, it keeps our incentives perfectly aligned. Our incentive is to run our business just like you would - without any bias. It is also resilient. It is not dependent on the profitability of your business. And it is not dependent on external market factors either. It is dependent solely on your expectations and our ability to exceed your expectations.

3. A MOTIVATED WORKFORCE

Our model gives you full access to local talents and opportunities. But there is more to it. Following the takeover, you will also benefit from a workforce of co-owners - eager to exceed your expectations and innovate.

A workforce of co-owners

As a cooperative company, 80% of the shares of Technomorph CC are held by its employees. They participate in its profits in proportion to their remunerations as employees.

Eager to exceed your expectations

As shareholders, they have the exact same financial incentives as Technomorph CC. They too have the strongest incentives to increase gross profits, exceed your expectations and innovate.

Independently managed

The remaining 20% of the shares of Technomorph CC are held by Technomorph MGMT, the independent management company responsible for the commercial development of Technomorph CC, the provision of shared services to Technomorph CC and the protection of the interests of Technomorph CC's clients.

Technomorph MGMT has the same financial incentives as Technomorph CC's employees - but without the collective action issues arising from dispersed share ownership. Technomorph MGMT also acts as the sole director of Technomorph CC. It is the cornerstone of our organisational business model. It is in control. And it has a vested interest in the success of our relationship. It has the most to gain if you are happy. And the most to lose if you are not.

4. Secured, CENTRALISED OWNERSHIP

All intangibles - including goodwill - will stay with your remaining group members. On top of this, we maintain stringent controls to keep your secrets secret and look after your human capital.

NO CHATTING

Technomorph CC is structured as a group of independent entreprises, each assigned to a particular client. All entreprises are ring fenced - hierarchically and physically. Information may go up - to Technomorph MGMT or to the client concerned - but never down or sideways.

NO ROAMING

Since we work with a multitude of clients, we are able to monitor our employees much more effectively than in the open labour market. Although we cannot prevent them from leaving, we can prevent our other clients from hiring them. By controlling one side of the market, we control the market - and prevent abuses.

5. UNIQUE NEW SYNERGIES

With many clients come many opportunities. Economies of scale, cross sales, network effects... Those opportunities are endless. And if you are fine with it, we will seek to make the most of them. Think of us as a supermarket for technological services. Or a cartel. Or both.

Think of us as shared, standardised, efficient, low cost distribution structure that offers reach and convenience. But in a controlled environment - that manages competition and protects profits. 

This service is provided as part of our normal distribution service. It is included in our normal remuneration - in the form of the unexpected profit those opportunities will generate. Importantly, this service is entirely optional. 

6. STRONGER CASH FLOWS

Financially, the takeover achieves the same result as a sale and leaseback transaction. It gives you the opportunity to increase your liquidity - at a very low cost.

The takeover allows you to unlock the value built up in your local marketing operations. Its proceeds can be returned to your shareholders - or redirected to new projects with a better ROI.

Our profit margin is low. Because profits follow risks. And we do not take risks. All our risks are segregated - and either passed on to our clients or hedged with external investors.

7. SIMPLER TAX STRUCTURE

Lastly, our model allows you to drastically reduce your exposure to foreign taxes. Your tax structure is simpler, cleaner and more efficient.

Permanent establishments

As a mere distributor, we will not cause you to recognise permanent establishments in the countries in which we operate.

Transfer pricing

As an unrelated party, the amount or calculation of our unilateral royalty payment will not be subject to transfer pricing review. You may even use it as a comparable uncontrolled price to validate similar arrangements among remaining group members.

Withholding taxes

As a resident of Luxembourg, our unilateral royalty payment will not be subject to any withholding taxes. 

Capital gains & exit taxes

Properly structured, the takeover should be tax neutral. And since it does not involve any intra entity transfer of assets, exit taxes will not be an issue either.

Digital services taxes

Digital services taxes may apply - depending on your particular line of business and the satisfaction of certain thresholds. To the extent they apply, digital services taxes will be payable by us. If you are below the appliable thresholds, our relationship will be reconfigured as an independent agency, to keep you out of scope.

 GLOBE

By converting sales into royalties, our arrangement naturally will reduce your revenues. This may allow you to stay below the  EUR 750m revenue threshold of GLOBE.

Amounts A, B & C

Similarly, our arrangement may allow you to stay below the EUR 20 billion revenue threshold of Amount A. 

Furthermore, even if you exceed that threshold, our arrangement will reduce the share of Amount A attributable to the countries where we operate. 

In any event, Amounts B & C will not be in issue. Since following the takeover, your local taxable presence will cease.  

Common Consolidated Corporate Tax Base

As an independent entreprise, our payroll, assets or sales factors will not affect yours if or when the CCCTB is implemented.

Special considerations for US clients

We are structured to qualify for IRC 954(6)'s related CFC exception.

Technomorph CC