Basis of Presentation

3 Months Ended

Mar. 31, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation and Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of Diebold Nixdorf, Incorporated and its subsidiaries (collectively, the Company) have been prepared in accordance with the instructions to Form 10-Q and therefore do not include all information and footnotes necessary for a fair presentation of financial position, results of operations and cash flows in conformity with accounting principles generally accepted in the United States (U.S. GAAP); however, such information reflects all adjustments (consisting solely of normal recurring adjustments) that are, in the opinion of management, necessary for a fair statement of the results for the interim periods presented.

The condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. In addition, some of the Company’s statements in this Quarterly Report on Form 10-Q may involve risks and uncertainties that could significantly impact expected future results. The results of operations for the three months ended March 31, 2023 are not necessarily indicative of results to be expected for the full year.

The Company has reclassified the presentation of certain prior-year information to conform to the current presentation.

Going Concern Assessment

The Company's condensed consolidated financial statements included herein have been prepared using the going concern basis of accounting, which contemplates continuity of operations, realization of assets, and satisfaction of liabilities in the normal course of business. Pursuant to the requirements of ASC Topic 205-40, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, management must evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern for one year from the date the consolidated financial statements are issued. As part of this assessment, based on conditions that are known and reasonably knowable to us, the Company considers various scenarios, forecasts, projections, and estimates, and makes certain key assumptions, including the timing and nature of projected cash expenditures or programs, and the Company’s ability to delay or curtail those expenditures or programs, if necessary, among other factors. This evaluation does not take into consideration the potential mitigating effect of management’s plans that have not been fully implemented or are not within control of the Company as of the date the condensed consolidated financial statements are issued.

As previously disclosed, the Company is currently working to improve its operating performance and its cash, liquidity and financial position. In addition, the Company has been in discussions with its lenders with respect to a long-term solution for the Company’s capital structure, leverage ratio and liquidity needs. As a result of these discussions, on May 30, 2023, the Company and certain of its direct and indirect subsidiaries (collectively, the Company Parties) entered into a Restructuring Support Agreement (the Restructuring Support Agreement) with certain holders (collectively, the Consenting Creditors) of: (i) obligations under the Superpriority Credit Agreement (as defined in Note 9); (ii) term loan obligations under the New Term Loan Credit Agreement (as defined in Note 9); (iii) the 2025 Senior Notes (as defined in Note 9); and (iv) the 2L Notes (as defined in Note 9). The Consenting Creditors collectively hold the following approximate amounts of the Company’s outstanding secured debt obligations: (a) approximately 80% of the Company’s Superpriority Credit Agreement obligations; (b) approximately 79% of the Company’s New Term Loan Credit Agreement obligations; (c) approximately 78% of the Company’s 2025 Senior Notes obligations; and (d) approximately 59% of the Company’s 2L Notes obligations.

The Company’s ability to continue as a going concern is contingent upon, among other things, successful implementation of the Restructuring Transactions (as defined in Note 9) contemplated in the Restructuring Support Agreement, subject to the approval of the Bankruptcy Court (as defined in Note 9) and the Dutch Court (as defined in Note 9). There can be no certainty that the Restructuring Transactions will be effected or that disruption from the Chapter 11 Cases (as defined in Note 9) and Dutch Scheme Proceedings (as defined in Note 9) contemplated by the Restructuring Support Agreement (as defined below) will not interfere with the Company’s business. As of March 31, 2023 substantial doubt exists regarding our ability to continue as a going concern.

The inclusion of the “going concern” uncertainty paragraph in the independent registered public accounting firm’s report in the Company's annual report on Form 10-K for the year ended December 31, 2023, covering the Company's audited consolidated

financial statements would have constituted a default under the agreements governing the ABL Facility (as defined in Note 9), the Superpriority Facility (as defined in Note 9) and the New Term Loans (as defined in Note 9); however, the requisite lenders under each of these facilities have waived such default.

The consolidated financial statements do not include any adjustments to the carrying amounts and classification of assets, liabilities, and reported expenses that may be necessary if the Company were unable to continue as a going concern.

Recently Issued Accounting Guidance

The Company considers the applicability and impact of all Accounting Standards Updates (ASUs) issued by the Financial Accounting Standards Board (FASB).

In March 2020, the FASB issued guidance that provides optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions affected by the transition away from reference rates expected to be discontinued to alternative reference rates. The guidance was effective upon issuance and may be applied prospectively to contract modifications made and hedging relationships entered into on or before December 31, 2024. The standard does not materially impact the Company's consolidated financial statements.

Although there are other new accounting pronouncements issued by the FASB, the Company does not believe these pronouncements will have a material impact on its consolidated financial statements.