##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
 For the quarterly period ended March 31, 2007
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
 For the transition period from:  to
 Commission File Number 0-24720
 Business Objects S.A.
  Republic of France
    
    98-0355777(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification No.)
 157-159 rue Anatole France, 92300 Levallois-Perret, France
 (408) 953-6000
 þ o
  þ o o
 o þ




---



##### Table of Contents



Business Objects S.A.
Index
 PagePART I.
    
    FINANCIAL INFORMATION
    
    
    3Item 1.
    
    Financial Statements
    
    
    3Condensed Consolidated Balance Sheets as of March 31, 2007 and December 31, 2006
    
    
    3Condensed Consolidated Statements of Income for the Three Months Ended March 31, 2007 and 2006
    
    
    4Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2007 and 2006
    
    
    5Notes to Condensed Consolidated Financial Statements
    
    
    6Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    19Item 3.
    
    Quantitative and Qualitative Disclosures about Market Risk
    
    
    30Item 4.
    
    Controls and Procedures
    
    
    30PART II.
    
    OTHER INFORMATION
    
    
    31Item 1.
    
    Legal Proceedings
    
    
    31Item 1A.
    
    Risk Factors
    
    
    34Item 2.
    
    Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    51Item 6.
    
    Exhibits
    
    
    52SIGNATURES
    
    
    
    
    53EXHIBIT 2.1EXHIBIT 4.1EXHIBIT 10.82EXHIBIT 31.1EXHIBIT 31.2EXHIBIT 32.1
 2




---



##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 BUSINESS OBJECTS S.A.
 
 CONDENSED CONSOLIDATED BALANCE SHEETS
 (In thousands, except nominal value per ordinary share)
 March 31,
    
    
    December 31,2007
    
    
    2006 (1)(unaudited)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    631,479
    
    
    $
    506,792Restricted cash
    
    
    38,449
    
    
    
    42,997Short-term investments
    
    
    5,760
    
    
    
    5,736Accounts receivable, net
    
    
    309,063
    
    
    
    334,387Deferred tax assets
    
    
    12,483
    
    
    
    15,189Prepaid and other current assets
    
    
    68,341
    
    
    
    59,462Total current assets
    
    
    1,065,575
    
    
    
    964,563Goodwill
    
    
    1,270,181
    
    
    
    1,266,057Other intangible assets, net
    
    
    117,391
    
    
    
    128,635Property and equipment, net
    
    
    90,695
    
    
    
    91,091Deposits and other assets
    
    
    17,567
    
    
    
    20,897Long-term restricted cash
    
    
    11,169
    
    
    
    11,131Long-term deferred tax assets
    
    
    11,771
    
    
    
    12,616Total assets
    
    $
    2,584,349
    
    
    $
    2,494,990LIABILITIES AND SHAREHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    40,187
    
    
    $
    36,070Accrued payroll and related expenses
    
    
    85,321
    
    
    
    105,967Income taxes payable
    
    
    2,221
    
    
    
    96,088Deferred revenues
    
    
    332,003
    
    
    
    283,631Other current liabilities
    
    
    131,609
    
    
    
    106,776Escrows payable
    
    
    34,889
    
    
    
    34,539Total current liabilities
    
    
    626,230
    
    
    
    663,071Long-term escrows payable
    
    
    7,692
    
    
    
    7,654Other long-term liabilities
    
    
    7,103
    
    
    
    7,077Long-term income taxes payable
    
    
    99,292
    
    
    
    Long-term deferred tax liabilities
    
    
    2,521
    
    
    
    4,597Long-term deferred revenues
    
    
    8,760
    
    
    
    9,772Total liabilities
    
    
    751,598
    
    
    
    692,171Commitments and contingenciesShareholders equity:Ordinary
shares, 0.10 nominal value ($0.13
and $0.13, as of March 31, 2007 and December
31, 2006, respectively): authorized 266,637 and
263,533; issued 98,339 and 97,424; issued and
outstanding 95,650 and 94,932; respectively at
March 31, 2007 and December 31, 2006
    
    
    10,804
    
    
    
    10,707Additional paid-in capital
    
    
    1,347,994
    
    
    
    1,320,993Treasury, Business Objects Option LLC, and
Employee Benefit Sub-Plan Trust shares: 2,689
shares at March 31, 2007 and 2,492 shares at
December 31, 2006
    
    
    (6,039
    )
    
    
    (5,247
    )Retained earnings
    
    
    415,191
    
    
    
    417,709Accumulated other comprehensive income
    
    
    64,801
    
    
    
    58,657Total shareholders equity
    
    
    1,832,751
    
    
    
    1,802,819Total liabilities and shareholders equity
    
    $
    2,584,349
    
    
    $
    2,494,990
 
 (1)
    
    The balance sheet at December 31, 2006 has been derived from the audited consolidated
financial statements at that date.  3




---



##### Table of Contents



BUSINESS OBJECTS S.A.
 
 CONDENSED CONSOLIDATED STATEMENTS OF INCOME
 (In thousands, except per ordinary share and ADS data)
 Three Months EndedMarch 31,2007
    
    
    2006(unaudited)Revenues:Net license fees
    
    $
    137,393
    
    
    $
    125,894Services
    
    
    196,950
    
    
    
    152,377Total revenues
    
    
    334,343
    
    
    
    278,271Cost of revenues:Net license fees
    
    
    10,870
    
    
    
    7,976Services
    
    
    68,831
    
    
    
    60,767Total cost of revenues
    
    
    79,701
    
    
    
    68,743Gross profit
    
    
    254,642
    
    
    
    209,528Operating expenses:Sales and marketing
    
    
    137,341
    
    
    
    117,500Research and development
    
    
    52,341
    
    
    
    43,737General and administrative
    
    
    33,639
    
    
    
    30,363Legal contingency reserve
    
    
    25,700
    
    
    
    Total operating expenses
    
    
    249,021
    
    
    
    191,600Income from operations
    
    
    5,621
    
    
    
    17,928Interest and other income, net
    
    
    4,129
    
    
    
    2,855Income before provision for income taxes
    
    
    9,750
    
    
    
    20,783Provision for income taxes
    
    
    (4,168
    )
    
    
    (8,446
    )Net income
    
    $
    5,582
    
    
    $
    12,337Basic net income per ordinary share and ADS
    
    $
    0.06
    
    
    $
    0.13Diluted net income per ordinary share and ADS
    
    $
    0.06
    
    
    $
    0.13Ordinary shares and ADSs used in computing basic net income per ordinary share and ADS
    
    
    95,235
    
    
    
    92,552Ordinary shares and ADSs and equivalents used in computing diluted net income per
ordinary share and ADS
    
    
    97,094
    
    
    
    95,333
  4




---



##### Table of Contents



BUSINESS OBJECTS S.A.
 
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 (In thousands)
 Three Months EndedMarch 31,2007
    
    
    2006(unaudited)Operating activities:Net income
    
    $
    5,582
    
    
    $
    12,337Adjustments to reconcile net income to net cash provided by operating activities:Depreciation and amortization of property and equipment
    
    
    8,161
    
    
    
    7,881Amortization of other intangible assets
    
    
    12,074
    
    
    
    8,869Stock-based compensation expense
    
    
    11,597
    
    
    
    13,410Excess tax benefits from stock-based compensation
    
    
    
    
    
    
    (2,422
    )Deferred income taxes
    
    
    (729
    )
    
    
    (2,835
    )Changes in operating assets and liabilities:Accounts receivable, net
    
    
    27,609
    
    
    
    20,800Prepaid and other current assets
    
    
    (8,600
    )
    
    
    (5,826
    )Deposits and other assets
    
    
    3,360
    
    
    
    2,516Accounts payable
    
    
    (481
    )
    
    
    2,391Accrued payroll and related expenses
    
    
    (21,270
    )
    
    
    (17,607
    )Income taxes payable
    
    
    (96
    )
    
    
    6,163Deferred revenues
    
    
    45,466
    
    
    
    46,416Other liabilities
    
    
    24,737
    
    
    
    (3,824
    )Short-term investments classified as trading
    
    
    (25
    )
    
    
    (302
    )Net cash provided by operating activities
    
    
    107,385
    
    
    
    87,967Investing activities:Purchases of property and equipment
    
    
    (7,031
    )
    
    
    (10,018
    )Increase in escrow payable
    
    
    332
    
    
    
    191Transfer of cash (to) from restricted cash accounts
    
    
    4,510
    
    
    
    (191
    )Net cash used in investing activities
    
    
    (2,189
    )
    
    
    (10,018
    )Financing activities:Issuance of shares
    
    
    15,506
    
    
    
    11,820Excess tax benefits from stock-based compensation
    
    
    
    
    
    
    2,422Net cash provided by financing activities
    
    
    15,506
    
    
    
    14,242Effect of foreign exchange rate changes on cash and cash equivalents
    
    
    3,985
    
    
    
    781Net increase in cash and cash equivalents
    
    
    124,687
    
    
    
    92,972Cash and cash equivalents, beginning of the period
    
    
    506,792
    
    
    
    332,777Cash and cash equivalents, end of the period
    
    $
    631,479
    
    
    $
    425,749
  5




---



##### Table of Contents



Business Objects S.A.
 
 Notes to Condensed
Consolidated Financial Statements
March 31, 2007
 1. Basis of Presentation and Significant Accounting Policies
 Basis of Presentation
   Use of Estimates
  Other Current Liabilities
  Ordinary Shares, Treasury Shares, Business Objects Option LLC Shares and Employee Benefit Sub Plan
Trust Shares
 Treasury, Business
Objects Option LLC and Employee Benefit Sub-Plan Trust Shares.
  6




---



##### Table of Contents



Recent Accounting Pronouncements
 The Fair Value Option for Financial Assets
and Financial Liabilities, including an amendment of SFAS No. 115
 2. Derivative Financial Instruments
      Notional Amount
    
    Fair Value(in millions)U.S. dollar equivalent of derivatives not designated as hedges
    
    $
    65.2
    
    
    $
    0.9U.S. dollar equivalent of derivatives designated as cash flow hedges
    
    $
    66.1
    
    
    $
    (0.8
    )
  7




---



##### Table of Contents



3. Accounts Receivable
  4. Shareholders Equity
    StockFor the three months ended March 31, 2007
    
    Warrants
    
    
    Options
    
    
    RSUs
    
    
    IESPP
    
    
    ESPP
    
    
    TotalCost of license fees
    
    
    
    
    
    $
    9
    
    
    
    
    
    
    
    
    
    
    $
    1
    
    
    $
    10Cost of services
    
    
    
    
    
    
    966
    
    
    $
    123
    
    
    $
    287
    
    
    
    12
    
    
    
    1,388Sales and marketing
    
    
    
    
    
    
    3,077
    
    
    
    612
    
    
    
    631
    
    
    
    54
    
    
    
    4,374Research and development
    
    
    
    
    
    
    1,049
    
    
    
    51
    
    
    
    245
    
    
    
    84
    
    
    
    1,429General and administrative
    
    $
    265
    
    
    
    2,864
    
    
    
    1,101
    
    
    
    137
    
    
    
    29
    
    
    
    4,396Total compensation expense
    
    
    265
    
    
    
    7,965
    
    
    
    1,887
    
    
    
    1,300
    
    
    
    180
    
    
    
    11,597Income tax benefit
    
    
    
    
    
    
    (1,011
    )
    
    
    (355
    )
    
    
    
    
    
    
    
    
    
    
    (1,366
    )Total compensation expense, net of tax
    
    $
    265
    
    
    $
    6,954
    
    
    $
    1,532
    
    
    $
    1,300
    
    
    $
    180
    
    
    $
    10,231
 StockFor the three months ended March 31, 2006
    
    Warrants
    
    
    Options
    
    
    RSUs
    
    
    IESPP
    
    
    ESPP
    
    
    TotalCost of license fees
    
    
    
    
    
    $
    11
    
    
    
    
    
    
    $
    1
    
    
    
    
    
    
    $
    12Cost of services
    
    
    
    
    
    
    1,166
    
    
    
    
    
    
    
    166
    
    
    $
    5
    
    
    
    1,337Sales and marketing
    
    
    
    
    
    
    2,969
    
    
    $
    35
    
    
    
    493
    
    
    
    16
    
    
    
    3,513Research and development
    
    
    
    
    
    
    1,649
    
    
    
    10
    
    
    
    146
    
    
    
    32
    
    
    
    1,837General and administrative
    
    $
    178
    
    
    
    3,288
    
    
    
    3,159
    
    
    
    76
    
    
    
    10
    
    
    
    6,711Total compensation expense
    
    
    178
    
    
    
    9,083
    
    
    
    3,204
    
    
    
    882
    
    
    
    63
    
    
    
    13,410Income tax benefit
    
    
    
    
    
    
    (1,290
    )
    
    
    (29
    )
    
    
    
    
    
    
    
    
    
    
    (1,319
    )Total compensation expense, net of tax
    
    $
    178
    
    
    $
    7,793
    
    
    $
    3,175
    
    
    $
    882
    
    
    $
    63
    
    
    $
    12,091
 8




---



##### Table of Contents



Three Months Ended
    
    Three Months EndedMarch 31, 2007
    
    March 31, 2006Stock options
    
    RSUs
    
    IESPP
    
    ESPP
    
    Stock options
    
    RSUs
    
    IESPP
    
    ESPPExpected volatility
    
    
    51
    %
    
    
    N/A
    
    
    
    54
    %
    
    
    N/A
    
    
    
    47
    %
    
    
    N/A
    
    
    
    32
    %
    
    
    N/ARisk-free interest rate (1)
    
    
    4.05
    %
    
    
    N/A
    
    
    
    3.70
    %
    
    
    N/A
    
    
    
    3.53
    %
    
    
    N/A
    
    
    
    2.38
    %
    
    
    N/ATurnover rateFrance
    
    
    12
    %
    
    
    12
    %
    
    
    N/A
    
    
    
    N/A
    
    
    
    12
    %
    
    
    N/A
    
    
    
    N/A
    
    
    
    N/AOfficers / Directors
    
    
    14
    %
    
    
    14
    %
    
    
    12
    %
    
    
    N/A
    
    
    
    14
    %
    
    
    14
    %
    
    
    13
    %
    
    
    N/ARest of the world
    
    
    20
    %
    
    
    20
    %
    
    
    12
    %
    
    
    N/A
    
    
    
    20
    %
    
    
    20
    %
    
    
    13
    %
    
    
    N/ADividends
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Weighted average fair value in
    
    $
    15.72
    
    
    
    37.84
    
    
    
    11.17
    
    
    
    3.60
    
    
    
    15.03
    
    
    
    40.88
    
    
    
    8.41
    
    
    
    1.66Expected life (years)
    
    
    4.10
    
    
    
    1.98
    
    
    
    0.50
    
    
    
    N/A
    
    
    
    4.57
    
    
    
    N/A
    
    
    
    0.50
    
    
    
    N/A
 
 (1)
    
    The Company used the five to seven years IBoxx Eurozone interest rate for the stock
options and warrants with exercise prices denominated in Euro granted to French employees
and Directors, and the three to five years IBoxx Eurozone interest rate for the options with
exercise prices denominated in Euro granted to rest of the world. The Company used the
Euribor six month interest rate for the IESPP with a subscription price denominated in Euro.      Weighted-AverageWeighted
    
    
    
    
    
    RemainingNumber of Awards
    
    Average
    
    Aggregate
    
    ContractualStock
    
    
    
    
    
    Exercise Price
    
    Intrinsic
    
    Term (inWarrants
    
    Options
    
    RSUs
    
    (1)
    
    Value (2)
    
    years)Outstanding at January 1, 2007
    
    
    405
    
    
    
    12,187
    
    
    
    690
    
    
    $
    31.86
    
    
    $
    137,011
    
    
    
    6.28Granted (3)
    
    
    
    
    
    
    506
    
    
    
    160
    
    
    
    29.54
    
    
    
    6,037Cancelled / Expired
    
    
    
    
    
    
    (394
    )
    
    
    (24
    )
    
    
    35.96
    
    
    
    2,606Exercised
    
    
    (30
    )
    
    
    (609
    )
    
    
    (50
    )
    
    
    19.99
    
    
    
    12,045
    
    
    
    Outstanding at March 31, 2007
    
    
    375
    
    
    
    11,690
    
    
    
    776
    
    
    
    32.60
    
    
    
    99,256
    
    
    
    6.13Exercisable at March 31, 2007
    
    
    225
    
    
    
    6,759
    
    
    
    
    
    
    
    35.29
    
    
    
    50,702
    
    
    
    5.50Unvested expected to vest at
March 31, 2007
    
    
    150
    
    
    
    4,066
    
    
    
    560
    
    
    
    30.13
    
    
    
    33,485
    
    
    
    7.11
 
 (1)
    
    translated to U.S. dollars based on the noon buying rate as published by the Federal
Reserve Bank of New York for grants, exercises, cancellations and based on the closing rate
for the outstanding options.(2)
    
    computed as the difference between the closing quote on NASDAQ on January 1, 2007, at the
grant date, at the cancellation date, at the exercise date or at March 31, 2007 respectively,
and the option exercise price translated in U.S. dollars as per (1) above. The intrinsic value
cannot be negative and may equal zero when the option price exceeds the closing quote on the
NASDAQ.(3)
    
    as stock options are granted with an exercise price equal to the closing price on Euronext on
the grant date, the intrinsic value of grants is limited to RSUs. 9




---



##### Table of Contents



Number of
    
    Weighted-Awards (in
    
    Average Grantthousands)
    
    Date Fair ValueUnvested at January 1, 2007
    
    
    690
    
    
    $
    34.93Granted
    
    
    160
    
    
    
    37.84Vested
    
    
    (50
    )
    
    
    39.89Forfeited
    
    
    (24
    )
    
    
    36.39Unvested at March 31, 2007
    
    
    776
    
    
    
    35.16
    5. Goodwill and Other Intangible Assets
  10




---



##### Table of Contents



Three Months
    
    
    YearEnded
    
    
    EndedMarch 31,
    
    
    December 31,2007
    
    
    2006Balance, beginning of the year
    
    $
    1,266.0
    
    
    $
    1,166.0Goodwill acquired during the period
    
    
    2.3
    
    
    
    90.6Goodwill adjustments relating to prior year acquisitions
    
    
    1.5
    
    
    
    6.2Impact of foreign currency fluctuations on goodwill
    
    
    0.4
    
    
    
    3.2Balance, end of the period
    
    $
    1,270.2
    
    
    $
    1,266.0
   March 31,
    
    
    December 31,2007
    
    
    2006Developed technology
    
    $
    174.7
    
    
    $
    173.5Maintenance and support contracts
    
    
    56.2
    
    
    
    57.0Trade names
    
    
    10.5
    
    
    
    9.3License contracts and relationships
    
    
    2.9
    
    
    
    2.8Workforce
    
    
    1.5
    
    
    
    1.5Total other intangible assets, at cost
    
    
    245.8
    
    
    
    244.1Accumulated amortization on other intangible assets
    
    
    (128.4
    )
    
    
    (115.5
    )Other intangible assets, net
    
    $
    117.4
    
    
    $
    128.6
   Three Months EndedMarch 31,2007
    
    
    2006Amortization of:Developed technology (included in cost of net license fees)
    
    $
    8.5
    
    
    $
    6.0Maintenance and support contracts (included in cost of services revenues)
    
    
    2.7
    
    
    
    2.6Trade names (included in operating expenses)
    
    
    0.5
    
    
    
    0.3License contracts & relationships (included in cost of net license fees)
    
    
    0.3
    
    
    
    Workforce (included in operating expenses)
    
    
    0.1
    
    
    
    Total other intangibles amortization expense
    
    $
    12.1
    
    
    $
    8.9
  Remainder of 2007
    
    $
    36.42008
    
    
    45.32009
    
    
    16.22010
    
    
    13.82011
    
    
    5.5Thereafter
    
    
    0.2Total
    
    $
    117.4
 11




---



##### Table of Contents



6. Net Income per Share
  Three Months EndedMarch 31,2007
    
    
    2006(in thousands, except per share data)Basic net income per share:Numerator:Net income
    
    $
    5,582
    
    
    $
    12,337Denominator:Weighted average ordinary shares and ADSs outstanding  basic
    
    
    95,235
    
    
    
    92,552Net income per share  basic
    
    $
    0.06
    
    
    $
    0.13Diluted net income per share:Numerator:Net income
    
    $
    5,582
    
    
    $
    12,337Denominator:Weighted average ordinary shares and ADSs outstanding  basic
    
    
    95,235
    
    
    
    92,552Incremental ordinary shares and ADSs attributable to shares
exercisable under employee stock option plans, RSUs and
warrants (treasury stock method)
    
    
    1,859
    
    
    
    2,781Weighted average ordinary shares and ADSs outstanding  diluted
    
    
    97,094
    
    
    
    95,333Net income per share  diluted
    
    $
    0.06
    
    
    $
    0.13
   7. Comprehensive Income
  Three Months EndedMarch 31,2007
    
    
    2006(in thousands)Net income
    
    $
    5,582
    
    
    $
    12,337Other comprehensive income:Foreign currency translation adjustments
    
    
    4,921
    
    
    
    3,027Unrealized net gains (losses) on cash flow hedges, net of tax
    
    
    83
    
    
    
    (634
    )Realized net (gains) losses on cash flow hedges, net of tax, reclassified into earnings
    
    
    757
    
    
    
    (131
    )Other
    
    
    383
    
    
    
    Total comprehensive income
    
    $
    11,726
    
    
    $
    14,599
 8. Business Segment Information
   Three Months EndedMarch 31,2007
    
    
    2006United States
    
    $
    161.7
    
    
    $
    136.5Europe, Middle East and Africa (EMEA), excluding France
    
    
    108.1
    
    
    
    87.6France
    
    
    29.1
    
    
    
    24.4Americas, excluding the United States
    
    
    11.1
    
    
    
    10.7Asia Pacific
    
    
    24.3
    
    
    
    19.1Total revenues
    
    $
    334.3
    
    
    $
    278.3
 12




---



##### Table of Contents



9. Commitments and Contingencies
 Commitments
  Legal matters
     13




---



##### Table of Contents



14




---



##### Table of Contents



Decision Warehouse Consultoria E Importacao Ltda. Business Objects Do Brasil, Ltda
 Business Objects Do Brasil, Ltda. Decision
Warehouse.
 15




---



##### Table of Contents



10. Escrows Payable and Restricted Cash
        11. Credit Agreement
  16




---



##### Table of Contents



12. Accounting for and Disclosure of Guarantees
 Guarantors Accounting for Guarantees
    Product Warranties.
 Environmental Liabilities. Accounting for Asset Retirement
Obligations
 17




---



##### Table of Contents



Other Liabilities and Other Claims.
 13. Income Taxes
        14. Subsequent Events
 Intent to Acquire Cartesis S.A.
  Stock Repurchase Program.
  18




---



##### Table of Contents



Autorite des Marches Financiers
 Convertible Bond Offering.
 Autorité des Marchés Financiers
     
 Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
 The following discussion and analysis should be read together with our Condensed Consolidated
Financial Statements and the notes to those statements included elsewhere in this Quarterly Report
on Form 10-Q . This discussion contains forward-looking statements based on our current
expectations, assumptions, estimates and projections about Business Objects and our industry. These
forward-looking statements include, but are not limited to, statements concerning risks and
uncertainties. Our actual results could differ materially from those indicated in these
forward-looking statements as a result of certain factors, as more fully described in the Risk
Factors section of this Quarterly Report on Form 10-Q . We undertake no obligation to update
publicly any forward-looking statements for any reason, even if new information becomes available
or other events occur.
 Overview
  19




---



##### Table of Contents



Recent Developments
 Intent to Acquire Cartesis S.A.
  Stock Repurchase Program.
  Convertible Bond Offering.
      Key Performance Indicators
 Three Months EndedMarch 31,(In millions, except for percentages and diluted net income per share)
    
    2007
    
    2006Revenues
    
    $
    334.3
    
    
    $
    278.3Growth in revenues (compared to prior year comparative period)
    
    
    20
    %
    
    
    12
    %Income from operations
    
    $
    5.6
    
    
    $
    17.9Income from operations as percentage of total revenues
    
    
    2
    %
    
    
    6
    %Diluted net income per share
    
    $
    0.06
    
    
    $
    0.13
  20




---



##### Table of Contents



Results of Operations
  Three Months EndedMarch 31,2007
    
    2006Net license fees
    
    
    41
    %
    
    
    45
    %Services revenues:Maintenance and technical support
    
    
    43
    
    
    
    39Professional services
    
    
    16
    
    
    
    16Total services revenues
    
    
    59
    
    
    
    55Total revenues
    
    
    100
    
    
    
    100Cost of net license fees
    
    
    3
    
    
    
    3Cost of service revenues
    
    
    21
    
    
    
    22Total cost of revenues
    
    
    24
    
    
    
    25Gross margin
    
    
    76
    
    
    
    75Operating expenses:Sales and marketing
    
    
    41
    
    
    
    42Research and development
    
    
    16
    
    
    
    16General and administrative
    
    
    10
    
    
    
    11Legal contingency reserve
    
    
    7
    
    
    
    Total operating expenses
    
    
    74
    
    
    
    69Income from operations (operating margin)
    
    
    2
    
    
    
    6Interest and other income (expense), net
    
    
    1
    
    
    
    1Income before provision for income taxes
    
    
    3
    
    
    
    7Provision for income taxes
    
    
    (1
    )
    
    
    (3
    )Net income
    
    
    2
    %
    
    
    4
    %
 Seasonality
  Impact of Foreign Currency Exchange Rate Fluctuations on Results of Operations
    Three Months Ended March 31,2007
    
    2006Total revenues
    
    $
    16.2
    
    
    $
    (13.9
    )Total cost of revenues
    
    
    3.6
    
    
    
    (3.2
    )Sales and marketing expenses
    
    
    4.7
    
    
    
    (3.0
    )Research and development expenses
    
    
    1.8
    
    
    
    (1.5
    )General and administrative expenses
    
    
    1.1
    
    
    
    (0.6
    )
 21




---



##### Table of Contents



Revenues
 Three Months EndedMarch 31,2007
    
    
    2006(in millions)Net license fees
    
    $
    137.4
    
    
    $
    125.9Services revenues:Maintenance and technical support
    
    $
    143.7
    
    
    $
    108.6Professional services
    
    
    53.2
    
    
    
    43.8Total services revenues
    
    
    196.9
    
    
    
    152.4Total revenues
    
    $
    334.3
    
    
    $
    278.3
 Net License Fees .
   22




---



##### Table of Contents



Services Revenues .
   Geographic Revenues Mix
  Three Months EndedMarch 31,2007
    
    
    2006(in millions)Americas (1)
    
    $
    172.8
    
    
    $
    147.2Europe, Middle East and Africa (EMEA) (2)
    
    
    137.2
    
    
    
    112.0Asia Pacific
    
    
    24.3
    
    
    
    19.1Total revenues
    
    $
    334.3
    
    
    $
    278.3
 
 (1)
    
    Includes revenues in the United States of $161.7 million and $136.5 million for the three
months ended March 31, 2007 and 2006, respectively.(2)
    
    Includes revenues in France of $29.1 million and $24.4 million for the three months ended
March 31, 2007 and 2006, respectively.    Cost of Revenues
 Three Months EndedMarch 31,2007
    
    
    2006(in millions)Cost of revenues:Net license fees
    
    $
    10.9
    
    
    $
    8.0Services
    
    
    68.8
    
    
    
    60.7Total cost of revenues
    
    $
    79.7
    
    
    $
    68.7
  23




---



##### Table of Contents



Cost of net license fees .
 Cost of services revenues .
  Operating Expenses
 Three Months EndedMarch 31,2007
    
    
    2006(in millions)Sales and marketing
    
    $
    137.4
    
    
    $
    117.5Research and development
    
    
    52.3
    
    
    
    43.7General and administrative
    
    
    33.6
    
    
    
    30.4Legal contingency reserve
    
    
    25.7
    
    
    
    Total operating expenses
    
    $
    249.0
    
    
    $
    191.6
  Sales and Marketing Expenses .
  Research and Development Expenses .
  General and Administrative Expenses .
  24




---



##### Table of Contents



Legal Contingency Reserve .
  Interest and Other Income, Net
  Three Months EndedMarch 31,2007
    
    
    2006(in millions)Net interest income
    
    $
    4.3
    
    
    $
    3.0Net foreign exchange losses
    
    
    (0.3
    )
    
    
    (0.4
    )Other income
    
    
    0.1
    
    
    
    0.3Interest and other income, net
    
    $
    4.1
    
    
    $
    2.9
 Net Interest Income
  Net Foreign Exchange Losses
  Income Taxes
  Liquidity and Capital Resources
  Three Months EndedMarch 31,2007
    
    
    2006(in millions)Cash flow provided by operating activities
    
    $
    107.4
    
    
    $
    88.0Cash flow used in investing activities
    
    
    (2.2
    )
    
    
    (10.0
    )Cash flow provided by financing activities
    
    
    15.5
    
    
    
    14.2Effect of foreign exchange rate changes on cash and cash equivalents
    
    
    4.0
    
    
    
    0.8Net increase in cash and cash equivalents
    
    $
    124.7
    
    
    $
    93.0
   25




---



##### Table of Contents



Operating Activities
    Investing Activities .
 Financing Activities
 Future Liquidity Requirements
   26




---



##### Table of Contents



Contractual Obligations
 Convertible Bond Obligations
 Autorité des marchés financiers
     27




---



##### Table of Contents



Lease Obligations
  Guarantees
 Guarantors Accounting for Guarantees
    Product Warranties
 Environmental Liabilities Accounting for Asset Retirement Obligations
 Other Liabilities and Other Claims
 28




---



##### Table of Contents



Off-Balance Sheet Arrangements
  Critical Accounting Estimates
  
    
    Business combinations;
    
    Impairment of goodwill, intangible assets and long-lived assets;
    
    Contingencies and litigation;
    
    Accounting for income taxes; and
    
    Stock-based compensation
     29




---



##### Table of Contents



Managements
Discussion and Analysis of Financial Condition and Results of Operations
 Recent Accounting Pronouncements
  Factors Affecting Future Operating Results
  
 Item 3. Quantitative and Qualitative Disclosures About Market Risk
 Quantitative and
Qualitative Disclosures About Market Risk
 
 Item 4. Controls and Procedures
   30




---



##### Table of Contents



Part II. OTHER INFORMATION
 
 Item 1. Legal Proceedings
      31




---



##### Table of Contents



32




---



##### Table of Contents



Decision Warehouse Consultoria E Importacao Ltda. Business Objects Do Brasil, Ltda
 Business Objects Do Brasil, Ltda. Decision
Warehouse.
  33




---



##### Table of Contents



Item 1A. Risk Factors.
 We operate in a rapidly changing environment that involves numerous uncertainties and risks.
The following risks and uncertainties may have a material and adverse effect on our business,
financial condition or results of operations. You should consider these risks and uncertainties
carefully, together with all of the other information included or incorporated by reference in this
Quarterly Report on Form 10-Q before you decide whether to purchase any of our securities. If any
of the risks or uncertainties we face were to occur, the trading price of our securities could
decline, and you may lose all or part of your investment.
 Risks Related to Our Business
 Our quarterly operating results have been and will continue to be subject to fluctuation.
  
    
    we typically record a substantial amount of our revenues in the last weeks of a quarter,
rather than evenly throughout the quarter;
    
    our customers typically wait until their fourth quarter, the end of their annual budget
cycle, before deciding whether to purchase new software;
    
    economic activity in Europe and certain other countries generally slows during the summer
months;
    
    customers may delay purchase decisions in anticipation of (i) changes to our product
line, (ii) new products or platforms, (iii) product enhancements or (iv) in response to
announced pricing changes by us or our competitors;
    
    the mix of products and services and the amount of consulting services that our customers
order, and the associated revenue, varies from quarter to quarter, and we expect this
revenue mix to continue for the foreseeable future;
    
    we depend, in part, on large orders and any delay in closing a large order, such as the
delays we experienced in the three months ended June 30, 2006, may result in the realization
of potentially significant net license fees being postponed from one quarter to the next;
and
    
    we experience longer payment cycles for sales in certain foreign countries.
   34




---



##### Table of Contents



We may pursue strategic acquisitions and investments that could have an adverse effect on our
business if they are unsuccessful.
  
    
    The acquisitions may not enhance our business strategy;
    
    We may apply overly optimistic valuation assumptions and models for the acquired businesses;
    
    We may not integrate acquired businesses, technologies, products, personnel and operations effectively;
    
    Managements attention may be diverted from our day-to-day operations, resulting in
disruption of our ongoing business;
    
    We may not adopt an appropriate business model for integrated businesses, particularly
with respect to our go-to-market strategy;
    
    Customer demand for the acquired companys products may not meet our expectations;
    
    We may incur higher than anticipated costs for the support and development of acquired products;
    
    The acquired products may not be compatible with our existing products, making
integration of acquired products difficult and costly and potentially delaying the
release of other, internally developed products;
    
    We may have insufficient revenue to offset the increased expenses associated with acquisitions;
    
    We may not retain key employees, customers, distributors and vendors of the companies we acquire;
    
    Ineffective internal controls of the acquired company may require remediation as part of the integration process;
    
    We may be required to assume pre-existing contractual relationships which would be
costly for us to terminate and disruptive for our customers; and
    
    The acquisitions may result in infringement, trade secret, product liability or other
litigation.
  We are subject to claims and lawsuits that may result in adverse outcomes, which could harm
our results of operations or financial condition and cause our stock
price to decline.
  We are subject to frequent tax audits, where the ultimate resolution may result in additional
taxes.
  35




---



##### Table of Contents



If we overestimate revenues and are unable to reduce our expenses sufficiently in any quarter,
this could have a negative impact on our quarterly results of operations.
   Our revenues may be unpredictable due to the release of our BusinessObjects XI, release 2,
product, and the expected end of life of our separate, existing Business Objects and Crystal
Decisions products.
    Since we are required to report our consolidated financial results under both the U.S. GAAP
and International Financial Reporting Standards (IFRS) rules, we may incur increased operating
expenses, we may not fulfill the reporting requirements of one or both of these reporting
standards, we may be subject to inconsistent determinations with respect to our accounting policies
under these standards and investors may perceive our operating results to be drastically different
under these regimes.
 Document de Rèfèrence 2006 Document de Rèfèrence 2006
  36




---



##### Table of Contents



Changes to current accounting policies could have a significant effect on our reported
financial results or the way in which we conduct our business.
  
    
    Recognition of revenues;
    
    Business combinations;
    
    Impairment of goodwill, intangible assets and long-lived assets;
    
    Contingencies and litigation;
    
    Accounting for income taxes; and
    
    Stock-based compensation
  Changes in our stock-based compensation policy have adversely affected our ability to attract
and retain employees.
  Our market is highly competitive, which could harm our ability to sell products and services
and reduce our market share.
   Some of our competitors may have greater financial, technical, sales, marketing and other
resources than we do. In addition, acquisitions of, or other strategic transactions by our
competitors could weaken our competitive position or reduce our revenues.
  37




---



##### Table of Contents



We depend on strategic relationships and business alliances for continued growth of our
business.
    38




---



##### Table of Contents



We sell products only in the business intelligence software market; if sales of our products
in this market decline, our operating results will be harmed.
  If the market in which we sell business intelligence software does not grow as anticipated,
our future profitability could be negatively affected.
  
    
    not fully value the benefits of using business intelligence products;
    
    not achieve favorable results using business intelligence products;
    
    experience technical difficulty in implementing business intelligence products; or
    
    decide to use other technologies, such as search engines, to obtain the required business intelligence for their users.
  Our SaaS offerings carry a number of risks, some of which may be harmful to our business.
  
    
    We have limited experience in the on-demand services market;
    
    We may not be able to deliver these products or any enhancements to these products in the
manner we have conveyed to customers;
    
    Customers may question the viability or security of our on-demand offerings;
    
    We may not be able to provide sufficient, continuous customer support for
crystalreports.com and the nSite application platform;
    
    We may incur higher than anticipated costs as we expand further into the on demand
market;
 39




---



##### Table of Contents




    
    We could experience service interruptions with respect to our on demand offerings, which
could potentially impact our revenues and damage our customers businesses and result in
warranty claims or litigation;
    
    We may not be able to comply in a timely or cost effective manner with data privacy, data
security, export control and other regulatory requirements that apply to these products,
resulting in potential regulatory exposure as well as misappropriation of customer
confidential information and other claims;
    
    We may not realize anticipated market demand and acceptance of these on demand offerings;
and
    
    Sales of our sharing platforms bundled with license sales may delay the timing of revenue
recognition for license arrangements that would otherwise have been recorded at the time of
delivery.
  Our software may have defects and errors that could lead to a loss of revenues or product
liability claims.
  
    
    potential customers may delay purchases;
    
    customers may react negatively, which could reduce future sales;
    
    our reputation in the marketplace may be damaged;
    
    we may have to defend product liability claims;
    
    we may be required to indemnify our customers, distributors, original equipment manufacturers or other resellers;
    
    we may incur additional service and warranty costs; and
    
    we may have to divert additional development resources to correct the defects and errors,
which may result in the delay of new product releases or upgrades.
  We may have long sales cycles and may have difficulty providing and managing large scale
customer deployments, which could cause a decline or delay in recognition of our revenues and an
increase in our expenses.
   40




---



##### Table of Contents



Business disruptions could seriously harm our operations and financial condition and increase
our costs and expenses.
     We cannot be certain that our internal control over financial reporting will be effective or
sufficient in the future.
    The software market in which we operate is subject to rapid technological change and new
product introductions, which could negatively affect our product sales.
  
    
    adapting third party technology, including open source software;
    
    successful education and training of sales, marketing and consulting personnel;
    
    effective marketing and market acceptance;
    
    proper positioning and pricing; and
    
    product quality, including possible defects.
 41




---



##### Table of Contents



Failure to structure our business model properly for mid-market customers could have a
material adverse effect on our business and results of operations.
  We have committed to undertake certain internal practices in connection with handling of
employee information.
  The protection of our intellectual property rights is crucial to our business and, if third
parties use our intellectual property without our consent, our business could be damaged.
  
    
    policing unauthorized copying or use of our products is difficult and expensive;
    
    software piracy is a persistent problem in the software industry;
    
    our patents may not cover the full scope of our product offerings and may be challenged,
invalidated or circumvented, or may be enforceable only in certain jurisdictions; and
    
    our shrink-wrap licenses may be unenforceable under the laws of certain jurisdictions.
 42




---



##### Table of Contents



Third parties have asserted that our technology infringes upon their proprietary rights, and
others may do so in the future, which has resulted, and may in the future result, in costly
litigation and could adversely affect our ability to distribute our products.
   
    
    we would need to commit management resources in defense of the claim;
    
    we may incur substantial litigation costs in defense of the claim;
    
    we may have to expend significant development resources to redesign our products;
    
    we may be required to enter into royalty and licensing agreements with such third party under unfavorable terms; and
    
    we could be forced to cease selling or delay shipping our products should an adverse judgment be rendered against us.
  43




---



##### Table of Contents



Our loss of rights to use software licensed from third parties could harm our business.
  Our executive officers and key employees are crucial to our business, and we may not be able
to recruit, integrate and retain the personnel we need to succeed.
  We have multinational operations that are subject to risks inherent in international operations.
  
    
    technical difficulties and costs associated with product localization;
    
    challenges associated with coordinating product development efforts among geographically dispersed development centers;
    
    potential loss of proprietary information due to piracy, misappropriation or laws that
may be less protective of our intellectual property rights;
    
    lack of experience in certain geographic markets;
 44




---



##### Table of Contents




    
    the significant presence of some of our competitors in some international markets;
    
    potentially adverse tax consequences;
    
    import and export restrictions and tariffs may prevent us from shipping products to
particular jurisdictions or providing services to a particular market and may increase our
operating costs;
    
    failure to comply with foreign and domestic laws and other government controls applicable
to our multinational operations, such as trade and employment restrictions;
    
    potential fines and penalties resulting from failure to comply with laws and regulations
applicable to our international operations;
    
    management, staffing, legal and other costs of operating an enterprise spread over
various countries;
    
    the recent addition of a number of employees in offshore locations for which attrition
rates traditionally are believed to be higher than is generally true for North America and
Europe;
    
    political instability in the countries where we are doing business;
    
    fears concerning travel or health risks that may adversely affect our ability to sell our
products and services in any country in which the business sales culture encourages face to
face interactions; and
    
    different business practices and regulations, which may lead to the need for increased
employee education and supervision.
  Fluctuations in exchange rates between the euro, the U.S. dollar and the Canadian dollar, as
well as other currencies in which we do business, may adversely affect our operating results.
   Our effective tax rate may increase or fluctuate, which could increase our income tax expense
and reduce our net income.
  45




---



##### Table of Contents




    
    changes in forecasted annual operating income;
    
    changes in relative proportions of revenues and income before taxes in the various jurisdictions in which we operate;
    
    changes to the valuation allowance on net deferred tax assets;
    
    changes to actual or forecasted permanent differences between book and tax reporting,
including the tax effects of purchase accounting for acquisitions and non-recurring charges
which may cause fluctuations between reporting periods;
    
    impacts from any future tax settlements with state, federal or foreign tax authorities;
    
    impacts from changes in tax laws, regulations and interpretations in the jurisdictions in
which we operate, as well as the requirements of certain tax rulings;
    
    impacts from acquisitions and related integration activities; or
    
    impacts from new FASB or IFRS requirements.
  We will increase our indebtedness substantially by the issuance of the bonds.
  
    
    make it difficult for us to obtain any necessary future financing for working
capital, capital expenditures or debt service requirements;
    
    require us to dedicate a substantial portion of our expected cash flow from
operations to service our indebtedness, which would reduce the amount of our expected
cash flow available for other purposes, including working capital and capital
expenditures;
    
    limit our flexibility in planning for, or reacting to changes in, our business; and
    
    make us more vulnerable in the event of a downturn in our business, including but
not limited to a redemption at the option of the bond holders on the fifth, tenth or
fifteenth anniversary of the issuance of the bonds.
  We may not be able to pay our debt and other obligations.
  46




---



##### Table of Contents



Risks Related to Ownership of Our Ordinary Shares, our ADSs or our Bonds
 Provisions of our articles of association and French law could have anti-takeover effects and
could deprive shareholders who do not comply with such provisions of some or all of their voting
rights.
 AMF
    Our Board of Directors has the authority to implement certain anti-takeover measures which may
delay or discourage an acquisition of Business Objects.
  47




---



##### Table of Contents



We cannot be certain that these anti-takeover measures will be effective.
  Holders of our shares have limited rights to call shareholders meetings or submit shareholder
proposals, which could adversely affect their ability to participate in governance of Business
Objects.
  Interests of our shareholders will be diluted if they are not able to exercise preferential
subscription rights for our shares.
 (droits préférentiels de
souscription)
  It may be difficult for holders of our ADSs rather than our ordinary shares to exercise some
of their rights as shareholders.
  48




---



##### Table of Contents



Fluctuation in the value of the U.S. dollar relative to the euro may cause the price of our
ordinary shares to deviate from the price of our ADSs.
  The market price of our shares is susceptible to changes in our operating results and to stock
market fluctuations.
  
    
    announcements of our quarterly operating results and expected results of the future periods;
    
    our failure to achieve the operating results anticipated by analysts or investors;
    
    announcements of technological innovations or new products by us, our customers or competitors;
    
    releases or reports by or changes in security and industry analysts recommendations;
    
    announcements of our competitors or customers quarterly operating results, and expected results of future periods;
    
    addition of significant new customers or loss of current customers;
    
    sales or the perception in the market of possible sales of a large number of our shares
by our directors, officers, employees or principal stockholders; and
    
    developments or disputes concerning patents or proprietary rights or other events.
  An active trading market for the Bonds may not develop, and holders may not be able to sell
their Bonds at attractive prices or at all.
   49




---



##### Table of Contents



Bondholders will not be able to exercise their conversion right until the first anniversary of
the date of issuance of the bonds, at the earliest, and in the event an effective registration
statement is not available to register the shares during the second year following issuance,
bondholders will have to wait until the second anniversary of issuance before they may exercise
their conversion right, provided other conditions are met.
  Bondholders may not be able to exercise their conversion right until May 11, 2022, and the
value of the Bonds could be less than the value of the underlying shares.
  We may not have the ability to redeem the Bonds for cash pursuant to their terms.
  Under the terms and conditions of the Bonds, a majority of the bondholders may commit all
bondholders, which may negatively affect the value of the Bonds in the future.
  Any change in the laws from those currently in effect may require the terms and conditions to
be modified, which may have a material adverse affect the value of the Bonds.
  Fluctuations in exchange rates may substantially affect the value of the Bonds.
  50




---



##### Table of Contents



Any adverse rating of the Bonds may cause their trading price to fall.
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  51




---



##### Table of Contents



Item 6. Exhibits
 Exhibit 2.1
    
    Share Purchase Agreement, dated April 20, 2007, by and
among Sistecar S.A.S., Business Objects S.A. and certain
other parties.Exhibit 3.1
    
    Amended and Restated Bylaws of Business Objects, as
amended March 30, 2007 (English translation), is
incorporated herein by reference to Exhibit 3.1 filed with
our Current Report on Form 8-K filed with the SEC on April
5, 2007 (File No. 000-24720).Exhibit 4.1
    
    Extract from the Note DOperation containing
the
Terms and Conditions of the Bonds as filed with the Autorité
des Marchés Financiers on May 3, 2007 (English translation)Exhibit 10.35.3
    
    Agreement between Société Générale and Business Objects,
effective March 1, 2006, is incorporated herein by
reference to Exhibit 10.35.3 filed with our Current Report
on Form 8-K filed with the SEC on March 7, 2006 (File No.
000-24720).Exhibit 10.35.4
    
    Amendment Letter, signed February 28, 2007, between
Société Générale and Business Objects, is incorporated
herein by reference to Exhibit 10.35.4 filed with our
Annual Report on Form 10-K filed with the SEC on March 1,
2007 (File No. 000-24720).Exhibit 10.81
    
    Employment Agreement of Susan J. Wolfe, dated February
28, 2007, is incorporated herein by reference to Exhibit
10.81 filed with our Annual Report on Form 10-K filed with
the SEC on March 1, 2007 (File No. 000-24720).Exhibit 10.82
    
    Employment Agreement, dated April 4, 2007, between
Business Objects Americas and David Kennedy.31.1
    
    Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.31.2
    
    Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.32.1
    
    Certification of Chief Executive Officer and of Chief Financial Officer furnished pursuant to
Rule 13a-14(b) of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the United
States Code (18 U.S.C. 1350).
 52




---



##### Table of Contents



SIGNATURES
  Business Objects S.A.
(Registrant)Date: May 10, 2007
    
    By:
    
    /s/ John G. SchwarzJohn G. SchwarzChief Executive OfficerDate: May 10, 2007
    
    By:
    
    /s/ James R. TolonenJames R. TolonenChief Financial Officer and Senior Group VicePresident
 53




---



##### Table of Contents



EXHIBIT INDEX
 Exhibit 2.1
    
    Share Purchase Agreement, dated April 20, 2007, by and among Sistecar S.A.S., Business Objects S.A. and certain
other parties.Exhibit 3.1
    
    Amended and Restated Bylaws of Business Objects, as amended March 30, 2007 (English translation), is
incorporated herein by reference to Exhibit 3.1 filed with our Current Report on Form 8-K filed with the SEC on
April 5, 2007 (File No. 000-24720).Exhibit 4.1
    
    Extract from the Note DOperation containing the
Terms and Conditions of the Bonds as filed with the Autorité
des Marchés Financiers on May 3, 2007 (English translation).Exhibit 10.35.3
    
    Agreement between Société Générale and Business Objects, effective March 1, 2006, is incorporated herein by
reference to Exhibit 10.35.3 filed with our Current Report on Form 8-K filed with the SEC on March 7, 2006
(File No. 000-24720).Exhibit 10.35.4
    
    Amendment Letter, signed February 28, 2007, between Société Générale and Business Objects, is incorporated
herein by reference to Exhibit 10.35.4 filed with our Annual Report on Form 10-K filed with the SEC on March 1,
2007 (File No. 000-24720).Exhibit 10.81
    
    Employment Agreement of Susan J. Wolfe, dated February 28, 2007, is incorporated herein by reference to
Exhibit 10.81 filed with our Annual Report on Form 10-K filed with the SEC on March 1, 2007 (File No.
000-24720).Exhibit 10.82
    
    Employment Agreement, dated April 4, 2007, between Business Objects Americas and David Kennedy.31.1
    
    Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1
    
    Certification of Chief Executive Officer and of Chief Financial Officer furnished pursuant to
Rule 13a-14(b) of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the United
States Code (18 U.S.C. 1350).