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Kensho 36

Payments of merger-related restructuring costs

7

SEC-NUM

[Table of Contents](#i1852a2ea91e948d98ea7c44fc3e188ea_7)The following is a calculation of basic and diluted earnings per share: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended June 30, | | Six Months Ended June 30, | | | | (In millions, except per share amounts) | | 2022 | | 2021 | | 2022 | | 2021 | | | | | | | | | | | | | | | | | | | | Income (Numerator) | | | | | | | | | | | | | | Net income | | $ | 1,229 | | | $ | 30 | | | $ | 1,837 | | | $ | 156 | | | | | | | Less: dividends attributable to participating securities | | (1) | | | — | | | (3) | | | — | | | | | | | Less: Cimarex redeemable preferred stock dividends | | — | | | — | | | (1) | | | — | | | | | | | Net income available to common stockholders | | $ | 1,228 | | | $ | 30 | | | $ | 1,833 | | | $ | 156 | | | | | | | | | | | | | | | | | | | | | Shares (Denominator) | | | | | | | | | | | | | | Weighted-average shares - Basic | | 803 | | | 400 | | | 806 | | | 399 | | | | | | | Dilution effect of stock awards at end of period | | 5 | | | 3 | | | 3 | | | 3 | | | | | | | Weighted-average shares - Diluted | | 808 | | | 403 | | | 809 | | | 402 | | | | | | | | | | | | | | | | | | | | | Earnings per share: | | | | | | | | | | | | | | Basic | | $ | 1.53 | | | $ | 0.08 | | | $ | 2.28 | | | $ | 0.39 | | | | | | | Diluted | | $ | 1.52 | | | $ | 0.08 | | | $ | 2.27 | | | $ | 0.39 | | | | | | The following is a calculation of weighted-average shares excluded from diluted EPS due to anti-dilutive effect: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended June 30, | | Six Months Ended June 30, | | | | (In millions) | | 2022 | | 2021 | | 2022 | | 2021 | | | | | | | | | | | | | | | | | | | | Weighted-average stock awards excluded from diluted EPS due to the anti-dilutive effect calculated using the treasury stock method | | — | | | — | | | 1 | | | 1 | | | | | | | | | | | | | | | | | | | | 13. Related Party TransactionsFrom time to time, Helmerich & Payne, Inc. (“H&P”) provides contract drilling services to the Company. The Company incurred drilling costs of approximately $2 million and $5 million related to these services during the three and six months ended June 30, 2022, respectively.Hans Helmerich, a director of the Company, is the Chairman of the Board of Directors of H&P. 14. Restructuring CostsIn connection with the Merger, the Company incurred certain merger-related restructuring costs that are primarily related to workforce reductions and the associated employee severance benefits that were triggered by the Merger. The Company recognized $33 million of restructuring expenses during 2022 related to the accrual of employee-related severance and termination benefits associated with the expected termination of certain Cimarex employees.The following table summarizes the Company’s restructuring liabilities: | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | (In millions) | | Six Months Ended June 30, 2022 | | Balance at beginning of period | | $ | 43 | | | Additions to merger-related restructuring costs | | 33 | | | Payments of merger-related restructuring costs | | (7) | | | Balance at end of period | | $ | 69 | | 18

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Refund to customers related to claim of vendor fault in servicing nuclear plant for Entergy Gulf States Louisiana business

900,000

SEC-NUM

[Table of Contents](#i6266d2788e5849989ad57be380853c2d_7)Entergy Corporation and SubsidiariesNotes to Financial Statements In March 2019, Entergy Arkansas filed its annual redetermination of its energy cost rate pursuant to the energy cost recovery rider, which reflected a decrease from $0.01882 per kWh to $0.01462 per kWh and became effective with the first billing cycle in April 2019. In March 2019 the Arkansas Attorney General filed a response to Entergy Arkansas’s annual adjustment and included with its filing a motion for investigation of alleged overcharges to customers in connection with the FERC’s October 2018 order in the opportunity sales proceeding. Entergy Arkansas filed its response to the Attorney General’s motion in April 2019 in which Entergy Arkansas stated its intent to initiate a proceeding to address recovery issues related to the October 2018 FERC order. In May 2019, Entergy Arkansas initiated the opportunity sales recovery proceeding, discussed below, and requested that the APSC establish that proceeding as the single designated proceeding in which interested parties may assert claims related to the appropriate retail rate treatment of the FERC October 2018 order and related FERC orders in the opportunity sales proceeding. In June 2019 the APSC granted Entergy Arkansas’s request and also denied the Attorney General’s motion in the energy cost recovery proceeding seeking an investigation into Entergy Arkansas’s annual energy cost recovery rider adjustment and referred the evaluation of such matters to the opportunity sales recovery proceeding. In March 2020, Entergy Arkansas filed its annual redetermination of its energy cost rate pursuant to the energy cost recovery rider, which reflected a decrease from $0.01462 per kWh to $0.01052 per kWh. The redetermined rate became effective with the first billing cycle in April 2020 through the normal operation of the tariff. In March 2021, Entergy Arkansas filed its annual redetermination of its energy cost rate pursuant to the energy cost recovery rider, which reflected a decrease from $0.01052 per kWh to $0.00959 per kWh. The redetermined rate calculation also included an adjustment to account for a portion of the increased fuel costs resulting from the February 2021 winter storms. The redetermined rate became effective with the first billing cycle in April 2021 through the normal operation of the tariff. Entergy Louisiana Entergy Louisiana recovers electric fuel and purchased power costs for the billing month based upon the level of such costs incurred two months prior to the billing month. Entergy Louisiana’s purchased gas adjustments include estimates for the billing month adjusted by a surcharge or credit that arises from an annual reconciliation of fuel costs incurred with fuel cost revenues billed to customers, including carrying charges. In July 2014 the LPSC authorized its staff to initiate an audit of the fuel adjustment clause filings by Entergy Gulf States Louisiana, whose business was combined with Entergy Louisiana in 2015. The audit includes a review of the reasonableness of charges flowed through Entergy Gulf States Louisiana’s fuel adjustment clause for the period from 2010 through 2013. In January 2019 the LPSC staff consultant issued its audit report. In its report, the LPSC staff consultant recommended that Entergy Louisiana refund approximately $900,000, plus interest, to customers based upon the imputation of a claim of vendor fault in servicing its nuclear plant. Entergy Louisiana recorded a provision in the first quarter 2019 for the potential outcome of the audit. In August 2019, Entergy Louisiana filed direct testimony challenging the basis for the LPSC staff’s recommended disallowance and providing an alternative calculation of replacement power costs should it be determined that a disallowance is appropriate. Entergy Louisiana’s calculation would require no refund to customers. In July 2014 the LPSC authorized its staff to initiate an audit of Entergy Louisiana’s fuel adjustment clause filings. The audit includes a review of the reasonableness of charges flowed by Entergy Louisiana through its fuel adjustment clause for the period from 2010 through 2013. In January 2019 the LPSC staff issued its audit report recommending that Entergy Louisiana refund approximately $7.3 million, plus interest, to customers based upon the imputation of a claim of vendor fault in servicing its nuclear plant. Entergy Louisiana recorded a provision in the first quarter 2019 for the potential outcome of the audit. In August 2019, Entergy Louisiana filed direct testimony challenging the basis for the LPSC staff’s recommended disallowance and providing an alternative calculation of replacement power costs should it be determined that a disallowance is appropriate. Entergy Louisiana’s calculation 72

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Due in 1–2 years

2,208

SEC-NUM

[Table of Contents](#i98d6063bdf2440eba45e838b461fbea1_7) | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | Note 5 : | Restructuring and Other Charges | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended | | Nine Months Ended | | (In Millions) | | Oct 1, 2022 | | Sep 25, 2021 | | Oct 1, 2022 | | Sep 25, 2021 | | Employee severance and benefit arrangements | | $ | 607 | | | $ | 21 | | | $ | 650 | | | $ | 43 | | | | | | | | | | | | | Litigation charges and other | | 4 | | | 16 | | | (1,199) | | | 2,267 | | | Asset impairment charges | | 53 | | | 5 | | | 89 | | | 287 | | | Total restructuring and other charges | | $ | 664 | | | $ | 42 | | | $ | (460) | | | $ | 2,597 | | In the third quarter of 2022, the 2022 Restructuring Program was approved to rebalance our workforce and operations to create efficiencies and improve our product execution in alignment with our IDM 2.0 strategy. Restructuring charges are recorded as Corporate charges in the "all other" category presented in Note 2: Operating Segments within Notes to Consolidated Condensed Financial Statements and are primarily comprised of employee severance and benefits arrangements. As of October 1, 2022 we recorded $537 million as a current liability within Accrued compensation and benefits on the Consolidated Condensed Balance Sheets. We expect these actions to be substantially completed by the end of the first half of 2023, but they are subject to change. Any changes to the estimates or timing of executing the 2022 Restructuring Program will be reflected in our future results of operations.Litigation charges and other includes a $1.2 billion benefit in the first nine months of 2022 from the annulled penalty related to an EC fine that was recorded and paid in 2009, and a charge of $2.2 billion in the first nine months of 2021 related to the VLSI litigation. These were recorded as a Corporate benefit and charge in the "all other" category presented in "Note 2: Operating Segments" within Notes to Consolidated Condensed Financial Statements. Refer to "Note 12: Commitments and Contingencies" within Notes to Consolidated Condensed Financial Statements for further information on legal proceedings related to the EC fine and the VLSI litigation.Asset impairment charges includes $237 million of goodwill and other impairments related to the shutdown in the first nine months of 2021 of two of our non-strategic businesses, the results of which are included in the “all other” category presented in “Note 2: Operating Segments” within Notes to Consolidated Condensed Financial Statements. | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | Note 6 : | Investments | Short-term InvestmentsShort-term investments include marketable debt investments in corporate debt, government debt, and financial institution instruments. Government debt includes instruments such as non-U.S. government bonds and U.S. agency securities. Financial institution instruments include instruments issued or managed by financial institutions in various forms, such as commercial paper, fixed- and floating-rate bonds, money market fund deposits, and time deposits. As of October 1, 2022 and December 25, 2021, substantially all time deposits were issued by institutions outside the U.S.For certain of our marketable debt investments, we economically hedge market risks at inception with a related derivative instrument or the marketable debt investment itself is used to economically hedge currency exchange rate risk from remeasurement. These hedged investments are reported at fair value with gains or losses from the investments and the related derivative instruments recorded in Interest and other, net. The fair value of our hedged investments was $16.6 billion as of October 1, 2022 and $21.5 billion as of December 25, 2021. For hedged investments still held at the reporting date, we recorded net losses of $861 million in the third quarter of 2022 and net losses of $1.8 billion in the first nine months of 2022 ($144 million of net losses in the third quarter of 2021 and $329 million of net losses in the first nine months of 2021). We recorded net gains on the related derivatives of $916 million in the third quarter of 2022 and net gains of $1.8 billion in the first nine months of 2022 ($156 million of net gains in the third quarter of 2021 and $346 million of net gains in the first nine months of 2021). Our remaining unhedged marketable debt investments are reported at fair value, with unrealized gains or losses, net of tax, recorded in accumulated other comprehensive income (loss). The adjusted cost of these investments was $3.6 billion as of October 1, 2022 and $5.0 billion as of December 25, 2021, which approximated the fair value for these periods.The fair value of marketable debt investments, by contractual maturity, as of October 1, 2022, was as follows: | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | (In Millions) | | Fair Value | | Due in 1 year or less | | $ | 11,457 | | | Due in 1–2 years | | 2,208 | | | Due in 2–5 years | | 4,962 | | | Due after 5 years | | 720 | | | Instruments not due at a single maturity date | | 861 | | | Total | | $ | 20,208 | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | intc-20221001_g2.jpg | Financial Statements | Notes to Financial Statements | 11 |

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Other

3

SEC-NUM

[Table of Contents](#i3e760ad3c5f94c5892b7ddc949ade806_7)degree of uncertainty as to the final consideration amount. Significant judgment is used in the estimate of variable consideration of customer contracts that are long-term and include uncertain transactional volumes.Technology or service components from third parties are frequently included in or combined with the Company’s applications or service offerings. Whether the Company recognizes revenue based on the gross amount billed to the customer or the net amount retained involves judgment in determining whether the Company controls the good or service before it is transferred to the customer. This assessment is made at the performance obligation level.Allocation of Transaction PriceThe transaction price, once determined, is allocated between the various performance obligations in the contract based upon their relative standalone selling prices. The standalone selling prices are determined based on the prices at which the Company separately sells each good or service. For items that are not sold separately, the Company estimates the standalone selling prices using all information that is reasonably available, including reference to historical pricing data.COMPUTER SOFTWARE DEVELOPMENTThe Company capitalizes new product development costs incurred for software to be sold from the point at which technological feasibility has been established through the point at which the product is ready for general availability. Software development costs that are capitalized are evaluated on a product-by-product basis annually for impairment and are assigned an estimated economic life based on the type of product, market characteristics, and maturity of the market for that particular product. These costs are amortized based on current and estimated future revenue from the product or on a straight-line basis, whichever yields greater amortization expense. All of this amortization expense is included within components of operating income, primarily cost of revenue.The Company capitalizes development costs for internal use software beginning at the start of application development. Amortization begins on the date the software is placed in service and the amortization period is based on estimated useful life.CASH EQUIVALENTSThe Company considers all highly liquid investments with maturities of three months or less at the time of acquisition to be cash equivalents.ACCOUNTS RECEIVABLEReceivables are recorded at the time of billing. On July 1, 2020, the Company adopted FASB Accounting Standards Codification ("ASC") Topic 326, Financial Instruments - Credit Losses, ("CECL") (see "Recent Accounting Pronouncements" below). As a result, the Company changed its accounting policy for allowance for credit losses. The accounting policy pursuant to CECL is disclosed below. The adoption of CECL resulted in an immaterial cumulative effect adjustment recorded in retained earnings as of July 1, 2020.The Company monitors trade and other receivable balances and contract assets and estimates the allowance for lifetime expected credit losses. Estimates of expected credit losses are based on historical collection experience and other factors, including those related to current market conditions and events.The following table summarizes allowance for credit losses activity for the years ended June 30, 2022, and 2021: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | Year Ended June 30, | | | 2022 | | 2021 | | Allowance for credit losses - beginning balance | $ | 7,266 | | | $ | 6,719 | | | Cumulative effect of accounting standards update adoption | — | | | 493 | | | Current provision for expected credit losses | 1,740 | | | 2,130 | | | Write-offs charged against allowance | (1,389) | | | (2,070) | | | Recoveries of amounts previously written off | (1) | | | (3) | | | Other | — | | | (3) | | | Allowance for credit losses - ending balance | $ | 7,616 | | | $ | 7,266 | | PROPERTY AND EQUIPMENT AND INTANGIBLE ASSETSProperty and equipment is stated at cost and depreciated using the straight-line method over the estimated useful lives of the assets.42

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Preferred Stock, Value, Issued

1,000

SEC-NUM

relevant legal requirements. Investment managers are directed to maintain equity portfolios at a risk level approximately equivalent to that of the specific benchmark established for that portfolio. Assets invested in fixed income securities and pooled fixed-income portfolios are managed actively to pursue opportunities presented by changes in interest rates, credit ratings, or maturity premiums. | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | Other Post-Retirement Benefits | | Assumed Healthcare Cost Trend Rates at the Balance Sheet Date | 2022 | | 2021 | | | | | | | | | | | | Healthcare cost trend rate – initial (%) | | | | | Pre-65 | n/a | | n/a | | Post-65 | 4.6 | % | | 7.3 | % | | Healthcare cost trend rate – ultimate (%) | | | | | Pre-65 | n/a | | n/a | | Post-65 | 4.1 | % | | 4.4 | % | | Year in which ultimate rates are reached | | | | | Pre-65 | n/a | | n/a | | Post-65 | 2040 | | | 2035 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 13. EQUITY, REDEEMABLE PREFERRED STOCK, AND ACCUMULATED OTHER COMPREHENSIVE LOSS Description of Capital StockThe Company is authorized to issue 1.00 billion shares of its Common Stock and 100 million shares of preferred stock, par value $0.01 per share. In accordance with the Company’s amended and restated certificate of incorporation, each share of Common Stock has one vote, and the Common Stock votes together as a single class. Public Offerings of Common StockOn June 15, 2020, the Company completed a public offering of its Common Stock (the “June 2020 Equity Offering”), in which the Company sold 8 million shares of Common Stock at a price of $70.72 per share, net of underwriting discounts and commissions. The Company obtained total net proceeds from the June 2020 Equity Offering of $548 million after the payment of associated offering expenses. The net proceeds of the June 2020 Equity Offering were used to repay $200 million of prophylactic borrowings from the third quarter of fiscal 2020 under Operating Company's Revolving Credit Facility, with the remainder available for general corporate purposes. On July 10, 2020, the underwriter for the June 2020 Equity Offering exercised its over-allotment option on 1 million additional shares, resulting in net proceeds of $82 million from the June 2020 Equity Offering, which was recorded in the fiscal year ended June 30, 2021.On February 6, 2020, the Company completed a public offering of its Common Stock (the “February 2020 Equity Offering”), in which the Company sold 8 million shares of Common Stock at a price of $58.58 per share, net of underwriting discounts and commissions. The Company obtained total net proceeds from the February 2020 Equity Offering of $494 million. The net proceeds of the February 2020 Equity Offering were used to repay $100 million of borrowings earlier in the quarter under Operating Company's Revolving Credit Facility and the consideration for the MaSTherCell acquisition due at its closing, with the remainder available for general corporate purposes.Redeemable Preferred StockIn May 2019, the Company designated 1 million shares of its preferred stock, par value $0.01, as its “Series A Convertible Preferred Stock” (the “Series A Preferred Stock”), pursuant to a certificate of designation of preferences, rights, and limitations and issued and sold 650,000 shares of the Series A Preferred Stock for an aggregate price of $650 million, to affiliates of Leonard Green & Partners, L.P., each share having an stated value of $1,000.Proceeds from the offering of the Series A Preferred Stock, net of stock issuance costs, were $646 million, of which $40 million was allocated to the dividend-adjustment feature at its issuance and separately accounted for as a derivative liability. Each change in the fair value of derivative liability during a fiscal quarter was recorded as a non-operating expense in the consolidated statement of operations. 105

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Proceeds from sale of assets

4

SEC-NUM

[Table of Contents](#i1852a2ea91e948d98ea7c44fc3e188ea_7)COTERRA ENERGY INC.CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Six Months Ended June 30, | | (In millions) | | 2022 | | 2021 | | CASH FLOWS FROM OPERATING ACTIVITIES | | | | | | Net income | | $ | 1,837 | | | $ | 156 | | | Adjustments to reconcile net income to cash provided by operating activities: | | | | | | Depreciation, depletion and amortization | | 774 | | | 186 | | | | | | | | | Deferred income tax expense | | 101 | | | 15 | | | Loss on sale of assets | | 1 | | | — | | | | | | | | | Loss on derivative instruments | | 457 | | | 101 | | | Net cash (paid) received in settlement of derivative instruments | | (464) | | | 3 | | | | | | | | | | | | | | | Amortization of premium and debt issuance costs | | (19) | | | 1 | | | Stock-based compensation and other | | 38 | | | 14 | | | Changes in assets and liabilities: | | | | | | Accounts receivable, net | | (489) | | | 32 | | | Income taxes | | (200) | | | (16) | | | Inventories | | (9) | | | (2) | | | Other current assets | | (6) | | | (3) | | | Accounts payable and accrued liabilities | | 147 | | | (12) | | | Interest payable | | 1 | | | (3) | | | Other assets and liabilities | | 32 | | | (3) | | | | | | | | | Net cash provided by operating activities | | 2,201 | | | 469 | | | | | | | | | CASH FLOWS FROM INVESTING ACTIVITIES | | | | | | Capital expenditures | | (745) | | | (274) | | | | | | | | | Proceeds from sale of assets | | 4 | | | — | | | | | | | | | | | | | | | | | | | | | Net cash used in investing activities | | (741) | | | (274) | | | | | | | | | CASH FLOWS FROM FINANCING ACTIVITIES | | | | | | | | | | | | Repayments of debt | | — | | | (88) | | | Repayments of finance leases | | (3) | | | — | | | Treasury stock repurchases | | (487) | | | — | | | | | | | | | Dividends paid | | (940) | | | (84) | | | | | | | | | Cash received for stock option exercises | | 10 | | | — | | | Cash paid for conversion of redeemable preferred stock | | (10) | | | — | | | Tax withholdings on vesting of stock awards | | (7) | | | (6) | | | | | | | | | | | | | | | Net cash used in financing activities | | (1,437) | | | (178) | | | | | | | | | Net increase in cash, cash equivalents and restricted cash | | 23 | | | 17 | | | Cash, cash equivalents and restricted cash, beginning of period | | 1,046 | | | 152 | | | Cash, cash equivalents and restricted cash, end of period | | $ | 1,069 | | | $ | 169 | | | | | | | | | | | | | | | | | | | | The accompanying notes are an integral part of these condensed consolidated financial statements.5

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Average Grant Date Fair Value Per Share, Granted

71.75

SEC-NUM

Dividend equivalents are only paid on earned awards after the performance period has concluded. Compensation expense for performance shares is recognized over the service period based on the number of shares ultimately expected to be earned. Performance shares awards are accounted for as liabilities in accordance with ASC 718, Compensation - Stock Compensation, with compensation expense adjusted at the end of each reporting period to reflect the change in fair value of the awards. Information related to performance share payouts for the years ended September 30, 2020 and 2021 follows (shares in thousands): | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 2020 | | | 2021 | | Performance period | 2017 - 2019 | | 2018 - 2020 | | Percent payout | 107 | % | | 100 | % | | Total shares earned | 2,008 | | 1,535 | | Shares distributed in cash, primarily for tax withholding | 883 | | 672 | As of September 30, 2021, approximately 1,327,000 shares awarded primarily in 2019 were outstanding, contingent on the Company achieving its performance objectives through 2021. The objectives for these shares were met at the 101 percent level and the shares will be distributed in early 2022. Additionally, the rights to receive approximately 1,547,000 and 1,497,000 common shares awarded in 2021 and 2020, respectively, are outstanding and contingent upon the Company achieving its performance objectives through 2023 and 2022, respectively. Incentive shares plans also include restricted stock awards and restricted stock units. Restricted stock awards involve distribution of common stock to key management employees subject to cliff vesting at the end of service periods ranging from three to ten years while restricted stock units granted to employees cliff vest at the end of a three-year period. The fair value of restricted stock awards and restricted stock units is determined based on the average of the high and low market prices of the Company's common stock on the date of grant, with compensation expense recognized ratably over the applicable vesting period. In 2021, approximately 87,000 shares of restricted stock vested as a result of participants fulfilling the applicable service requirements. Consequently, approximately 57,000 shares were issued while 30,000 shares were withheld for income taxes in accordance with minimum withholding requirements. As of September 30, 2021, there were approximately 1,269,000 shares of unvested restricted stock and restricted stock units outstanding. In addition to the employee stock option and incentive shares plans, in 2021 the Company awarded approximately 19,000 shares of restricted stock and 2,000 restricted stock units under the restricted stock plan for non-management directors. As of September 30, 2021, approximately 99,000 shares were available for issuance under this plan. As of September 30, 2021, 5.1 million shares remained available for award under incentive shares plans. Changes in shares outstanding but not yet earned under incentive shares plans during the year ended September 30, 2021 follow (shares in thousands; assumes 100 percent payout of unvested awards): | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | Shares | | Average Grant DateFair Value Per Share | | Beginning of year | 5,916 | | | | $ | 67.22 | | | | Granted | 2,095 | | | | $ | 71.75 | | | | | | | | | | | Earned/vested | (1,867) | | | | $ | 63.28 | | | | Canceled | (503) | | | | $ | 67.54 | | | | End of year | 5,641 | | | | $ | 70.22 | | | 53

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Litigation Settlement, Expense

109

SEC-NUM

[Table of Contents](#i96cbbb599c964cb4a125b720672b6568_10)Unallocated Items, Eliminations and otherUnallocated items, eliminations and other include common internal services that support Boeing’s global business operations, intercompany guarantees provided to BCC and eliminations of certain sales between segments. Such sales include airplanes accounted for as operating leases and considered transferred to the BCC segment. We generally allocate costs to business segments based on the U.S. federal cost accounting standards. Components of Unallocated items, eliminations and other are shown in the following table. | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | Years ended December 31, | 2021 | | 2020 | | 2019 | | Share-based plans | ($174) | | | ($120) | | | ($65) | | | Deferred compensation | (126) | | | (93) | | | (174) | | | Amortization of previously capitalized interest | (107) | | | (95) | | | (89) | | | Research and development expense, net | (184) | | | (240) | | | (401) | | | Customer financing impairment | | | | | (250) | | | Litigation | | | | | (109) | | | Eliminations and other unallocated items | (676) | | | (1,807) | | | (985) | | | Unallocated items, eliminations and other | ($1,267) | | | ($2,355) | | | ($2,073) | | | | | | | | | | Pension FAS/CAS service cost adjustment | $882 | | | $1,024 | | | $1,071 | | | Postretirement FAS/CAS service cost adjustment | 291 | | | 359 | | | 344 | | | FAS/CAS service cost adjustment | $1,173 | | | $1,383 | | | $1,415 | | Pension and Other Postretirement Benefit ExpensePension costs, comprising GAAP service and prior service costs, are allocated to BCA and the commercial operations at BGS. Pension costs are allocated to BDS and BGS businesses supporting government customers using U.S. Government Cost Accounting Standards (CAS), which employ different actuarial assumptions and accounting conventions than GAAP. These costs are allocable to government contracts. Other postretirement benefit costs are allocated to business segments based on CAS, which is generally based on benefits paid. FAS/CAS service cost adjustment represents the difference between the Financial Accounting Standards (FAS) pension and postretirement service costs calculated under GAAP and costs allocated to the business segments. Non-operating pension and postretirement expenses represent the components of net periodic benefit costs other than service cost. These expenses are included in Other income, net.122

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Private equity, cumulative observable price change

72

SEC-NUM

[Table of Contents](#iafeb83384c73449bb49e90c3c5b8201e_7) | | | | | --- | --- | --- | | | | | | Fifth Third Bancorp and SubsidiariesNotes to Condensed Consolidated Financial Statements (unaudited) | respectively, and an immaterial amount recorded as negative fair value adjustments for both the three and six months ended June 30, 2021, recorded in other noninterest expense or other noninterest income in the Condensed Consolidated Statements of Income subsequent to their transfer into OREO. The fair value amounts are generally based on appraisals of the property values, resulting in a classification within Level 3 of the valuation hierarchy. In cases where the carrying amount exceeds the fair value, less costs to sell, an impairment loss is recognized. The previous tables reflect the fair value measurements of the properties before deducting the estimated costs to sell. Bank premises and equipmentThe Bancorp performs assessments of the recoverability of long-lived assets when events or changes in circumstances indicate that their carrying values may not be recoverable. These properties were written down to their lower of cost or market values. At least annually thereafter, the Bancorp will review these properties for market fluctuations. The fair value amounts were generally based on appraisals of the property values, resulting in a classification within Level 3 of the valuation hierarchy. For further information on bank premises and equipment, refer to Note 7. Operating lease equipmentThe Bancorp performs assessments of the recoverability of long-lived assets when events or changes in circumstances indicate that their carrying values may not be recoverable. When evaluating whether an individual asset is impaired, the Bancorp considers the current fair value of the asset, the changes in overall market demand for the asset and the rate of change in advancements associated with technological improvements that impact the demand for the specific asset under review. As part of this ongoing assessment, the Bancorp determined that the carrying values of certain operating lease equipment were not recoverable and, as a result, the Bancorp recorded an impairment loss equal to the amount by which the carrying value of the assets exceeded the fair value. The fair value amounts were generally based on appraised values of the assets, resulting in a classification within Level 3 of the valuation hierarchy. Private equity investmentsThe Bancorp accounts for its private equity investments using the measurement alternative to fair value, except for those accounted for under the equity method of accounting. Under the measurement alternative, the Bancorp carries each investment at its cost basis minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer. The Bancorp recognized gains of an immaterial amount and $4 million during the three and six months ended June 30, 2022, respectively, and gains of an immaterial amount during both the three and six months ended June 30, 2021, resulting from observable price changes. The carrying value of the Bancorp’s private equity investments still held as of June 30, 2022 includes a cumulative $72 million of positive adjustments as a result of observable price changes since January 1, 2018. Because these adjustments are based on observable transactions in inactive markets, they are classified in Level 2 of the fair value hierarchy. For private equity investments which are accounted for using the measurement alternative to fair value, the Bancorp qualitatively evaluates each investment quarterly to determine if impairment may exist. If necessary, the Bancorp then measures impairment by estimating the value of its investment and comparing that to the investment’s carrying value, whether or not the Bancorp considers the impairment to be temporary. These valuations are typically developed using a DCF method, but other methods may be used if more appropriate for the circumstances. These valuations are based on unobservable inputs and therefore are classified in Level 3 of the fair value hierarchy. The Bancorp recognized impairment charges of $1 million and $11 million for the three and six months ended June 30, 2022, respectively, and impairment charges of an immaterial amount for both the three and six months ended June 30, 2021. The carrying value of the Bancorp’s private equity investments still held as of June 30, 2022 includes a cumulative $35 million of impairment charges recognized since adoption of the measurement alternative to fair value on January 1, 2018. Fair Value OptionThe Bancorp elected to measure certain residential mortgage loans held for sale under the fair value option as allowed under U.S. GAAP. Electing to measure residential mortgage loans held for sale at fair value reduces certain timing differences and better matches changes in the value of these assets with changes in the value of derivatives used as economic hedges for these assets. Management’s intent to sell residential mortgage loans classified as held for sale may change over time due to such factors as changes in the overall liquidity in markets or changes in characteristics specific to certain loans held for sale. Consequently, these loans may be reclassified to loans held for investment and maintained in the Bancorp’s loan portfolio. In such cases, the loans will continue to be measured at fair value. Fair value changes recognized in earnings for residential mortgage loans held at June 30, 2022 and 2021 for which the fair value option was elected, as well as the changes in fair value of the underlying IRLCs, included losses of $9 million and gains of $59 million, respectively. These losses and gains are reported in mortgage banking net revenue in the Condensed Consolidated Statements of Income. Valuation adjustments related to instrument-specific credit risk for residential mortgage loans measured at fair value negatively impacted the fair value of those loans by an immaterial amount at both June 30, 2022 and December 31, 2021. Interest on loans measured at fair value is accrued as it is earned using the effective interest method and is reported as interest income in the Condensed Consolidated Statements of Income. 124

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Securitized Funds Allocation

2.1

SEC-NUM

[Table of Contents](#i0fa971ac9e834218957059819155291f_10)Combined Notes to Consolidated Financial Statements(Dollars in millions, except per share data unless otherwise noted) Note 3 — Regulatory Mattersconsolidated financial statements may be affected by a number of factors, including the impacts of customer and counterparty defaults and recoveries, any additional solutions to address the financial challenges caused by the event, and related litigation and contract disputes. During February and March 2021, various parties with differing interests, including generators and retail providers, filed requests with the PUCT to void the PUCT’s orders setting prices at $9,000 per MWh during firm load shedding events. Other requests were made for the PUCT to enforce its order and reduce prices for 33 hours between February 18 and February 19 after firm load shedding ceased, and to cap ancillary services at $9,000 per MWh. On March 2, 2021, a third party filed a notice of appeal in the Court of Appeals for the Third District of Texas challenging the validity of the PUCT’s actions. Generation intervened in that appeal and filed its initial brief on June 2, 2021 and reply brief on November 5, 2021. On April 19, 2021, Generation filed a declaratory action and request for judicial review of the PUCT’s orders setting prices at $9,000 per MWh in District Court of Travis County, Texas. Generation subsequently requested that the District Court of Travis County, Texas stay its proceeding pending action by the Court of Appeals in the third party proceeding. On May 17, 2021, Generation amended its petition for declaratory action and request for judicial review pending in the District Court of Travis County, Texas. Exelon cannot reasonably predict the outcome of these proceedings or the potential financial statement impact.Due to the event, a number of ERCOT market participants experienced bankruptcies or defaulted on payments to ERCOT, resulting in approximately a $3.0 billion payment shortfall in collections, which is allocated to the remaining ERCOT market participants. As of December 31, 2021, Exelon has recorded Generation's estimated portion of this obligation, net of legislative solutions, of approximately $17 million on a discounted basis, which is to be paid over a term of 83 years. ERCOT rules historically have limited recovery of default from market participants to $2.5 million per month market-wide. In February 2021, the PUCT gave ERCOT discretion to disregard those rules, but ERCOT has declined to exercise that discretion as to the imposition of uplift charges. On March 8, 2021, a third party filed a notice of appeal in the Court of Appeals for the Third District of Texas challenging the validity of the PUCT's order to ERCOT in February 2021. Generation intervened in that appeal and filed its initial brief on July 7, 2021. The case has been stayed until March 3, 2022 to afford time for the PUCT to respond to ERCOT's November 18, 2021 request that the PUCT withdraw its February 2021 order. On May 7, 2021, Generation filed a declaratory action and request for judicial review of the PUCT's order in the District Court of Travis County, Texas. Generation subsequently requested that the District Court of Travis County, Texas stay its proceeding pending action by the Court of Appeals in the third party proceeding. Exelon cannot reasonably predict the outcome of these proceedings or the potential financial statement impact. Additionally, several legislative proposals were introduced in the Texas legislature during February and March 2021 concerning the amount, timing and allocation of recovery of the $3.0 billion shortfall, as well as recovery of other costs associated with the PUCT's directive to set prices at $9,000 per MWh. Two of these proposals were enacted into law in June 2021 and establish financing mechanisms that ERCOT and certain market participants can utilize to fund amounts owed to ERCOT. Generation participated in proceedings before the PUCT addressing the proposed allocation of the $2.1 billion in securitized funds for reliability and ancillary service charges over $9,000 per MWh. In September 2021, Generation entered into a settlement agreement and stipulation to resolve the allocation issues. The PUCT approved the settlement agreement and stipulation on October 13, 2021.In addition, other legislative proposals were introduced in the Texas legislature during February and March 2021 addressing cold-weather preparation for power plants and natural gas production and transportation infrastructure and the market structure for reliability services. The Texas legislature addressed these proposals by enacting a bill with a broad set of market reforms that, among other things, directed the PUCT to establish weatherization standards for electric generators within six months of enactment and gave the PUCT authority to impose administrative penalties if the new proposed standards, once adopted, are not met. On October 21, 2021, the PUCT adopted a rule change requiring generators by December 1, 2021 to complete a number of specified winter readiness preparations and to submit to ERCOT a report describing and certifying the completion of those preparations. The PUCT described these requirements as the first phase of its actions with respect to winter preparedness, which Generation completed timely, and will be followed by a second phase consisting of a year-round set of weather preparedness standards to be informed by a weather study conducted by ERCOT and submitted to the PUCT on December 15, 2021. The legislation also directs the PUCT to evaluate whether additional ancillary services are needed for reliability in the ERCOT power region to provide adequate incentives for dispatchable generation. Throughout 2021, Exelon and others submitted various proposals to the PUCT with respect to a range of potential market reforms, 218

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Current liabilities held for sale

75,233

SEC-NUM

[Table of Contents](#i754bc30884284e56b9b1a914458fa36e_7)GLOBAL PAYMENTS INC.CONSOLIDATED BALANCE SHEETS(in thousands, except share data) | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | September 30, 2022 | | December 31, 2021 | | | (Unaudited) | | | | ASSETS | | | | | Current assets: | | | | | Cash and cash equivalents | $ | 1,993,840 | | | $ | 1,979,308 | | | Accounts receivable, net | 998,231 | | | 946,247 | | | Settlement processing assets | 1,740,844 | | | 1,143,539 | | | Current assets held for sale | 93,740 | | | 4,779 | | | Prepaid expenses and other current assets | 626,697 | | | 637,112 | | | Total current assets | 5,453,352 | | | 4,710,985 | | | Goodwill | 23,421,031 | | | 24,813,274 | | | Other intangible assets, net | 9,907,884 | | | 11,633,709 | | | Property and equipment, net | 1,759,235 | | | 1,687,586 | | | Deferred income taxes | 25,657 | | | 12,117 | | | Noncurrent assets held for sale | 1,038,806 | | | — | | | Other noncurrent assets | 2,332,784 | | | 2,422,042 | | | Total assets | $ | 43,938,749 | | | $ | 45,279,713 | | | LIABILITIES AND EQUITY | | | | | Current liabilities: | | | | | Settlement lines of credit | $ | 440,950 | | | $ | 484,202 | | | Current portion of long-term debt | 1,157,811 | | | 78,505 | | | Accounts payable and accrued liabilities | 2,207,551 | | | 2,542,256 | | | Settlement processing obligations | 1,795,140 | | | 1,358,051 | | | Current liabilities held for sale | 75,233 | | | — | | | Total current liabilities | 5,676,685 | | | 4,463,014 | | | Long-term debt | 12,289,826 | | | 11,414,809 | | | Deferred income taxes | 2,439,657 | | | 2,793,427 | | | Noncurrent liabilities held for sale | 4,494 | | | — | | | Other noncurrent liabilities | 655,132 | | | 739,046 | | | Total liabilities | 21,065,794 | | | 19,410,296 | | | Commitments and contingencies | | | | | Equity: | | | | | Preferred stock, no par value; 5,000,000 shares authorized and none issued | — | | | — | | | Common stock, no par value; 400,000,000 shares authorized at September 30, 2022 and December 31, 2021; 270,307,707 issued and outstanding at September 30, 2022 and 284,750,452 issued and outstanding at December 31, 2021 | — | | | — | | | Paid-in capital | 20,717,133 | | | 22,880,261 | | | Retained earnings | 2,547,947 | | | 2,982,122 | | | Accumulated other comprehensive loss | (604,501) | | | (234,182) | | | Total Global Payments shareholders’ equity | 22,660,579 | | | 25,628,201 | | | Noncontrolling interests | 212,376 | | | 241,216 | | | Total equity | 22,872,955 | | | 25,869,417 | | | Total liabilities and equity | $ | 43,938,749 | | | $ | 45,279,713 | | See Notes to Unaudited Consolidated Financial Statements. 6

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Senior revolving credit facility available capacity

495.5

SEC-NUM

The Company’s commercial paper program requires the Company to maintain liquidity facilities either in an available amount equal to any outstanding notes from the program or in an amount sufficient to maintain the ratings assigned to the notes issued from the program. The Company’s commercial paper is rated AMB-1 by A.M. Best, P-3 by Moody’s and A-2 by S&P. The Company’s subsidiaries do not maintain commercial paper or other borrowing facilities. This program is currently backed up by the Credit Facility, of which $495.5 million was available at December 31, 2021, and $4.5 million letters of credit were outstanding.The Company did not use the commercial paper program during the years ended December 31, 2021 or 2020 and there were no amounts relating to the commercial paper program outstanding as of December 31, 2021 or 2020. Covenants The Credit Facility contains restrictive covenants including:(i)Maintenance of a maximum consolidated total debt to capitalization ratio on the last day of any fiscal quarter of not greater than 0.35 to 1.0, subject to certain exceptions; and(ii)Maintenance of a consolidated adjusted net worth in an amount not less than a “Minimum Amount” equal to the sum of (a) $4.20 billion, (b) 25% of consolidated net income (if positive) for each fiscal quarter ending after December 31, 2021 and (c) 25% of the net cash proceeds received from any capital contribution to, or issuance of any capital stock, disqualified capital stock and hybrid securities.In the event of a breach of certain covenants, all obligations under the Credit Facility, including unpaid principal and accrued interest and outstanding letters of credit, may become immediately due and payable. Interest Rate DerivativesIn March 2018, the Company exercised a series of derivative transactions it had entered into in 2017 to hedge the interest rate risk related to expected borrowing to finance the TWG acquisition. The Company determined that the derivatives qualified for hedge accounting as effective cash flow hedges and recognized a deferred gain of $26.7 million upon settlement that was reported through other comprehensive income. The deferred gain is being recognized as a reduction in interest expense related to the 2023 Senior Notes, the 2028 Senior Notes and the 2048 Subordinated Notes on an effective yield basis. The amortization of the deferred gain was $3.0 million for the years ended December 31, 2021, 2020 and 2019. The remaining deferred gain as of December 31, 2021 and 2020 was $15.6 million and $18.6 million, respectively. 20. Equity Transactions Common StockChanges in the number of shares of common stock outstanding are as follows for the periods presented: | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | December 31, | | | 2021 | | 2020 | | 2019 | | Shares of common stock outstanding, beginning | 57,967,808 | | | 59,945,893 | | | 61,908,979 | | | Vested restricted stock and restricted stock units, net (1) | 214,116 | | | 213,569 | | | 248,333 | | | Issuance related to performance share units (1) | 91,845 | | | 157,155 | | | 117,581 | | | Issuance related to ESPP | 113,555 | | | 90,166 | | | 88,498 | | | Issuance related to MCPS | 2,703,911 | | | — | | | — | | | Shares of common stock repurchased | (5,337,122) | | | (2,438,975) | | | (2,417,498) | | | Shares of common stock outstanding, ending | 55,754,113 | | | 57,967,808 | | | 59,945,893 | | (1)Vested restricted stock, restricted stock units and performance share units are shown net of shares of common stock retired to cover participant income tax liabilities. The Company is authorized to issue 800,000,000 shares of common stock. In addition, 150,001 shares of Class B common stock and 400,001 shares of Class C common stock are authorized but have not been issued. Stock RepurchaseIn January and May 2021, the Company’s Board of Directors (the “Board”) authorized the Company to repurchase up to $600.0 million and $900.0 million, respectively, aggregate cost at purchase of its outstanding common stock. F-62

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Credit Agreement, covenant terms, maximum leverage ratio

3.50

SEC-NUM

[Table of Contents](#i4552998170a04ab690e0e4bebd2d8dfd_7) FMC CORPORATIONNotes to Condensed Consolidated Financial Statements (unaudited) — (Continued) | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | (in Millions) | September 30, 2022 | | December 31, 2021 | | Short-term foreign debt (1) | $ | 80.1 | | | $ | 112.2 | | | Commercial paper (2) | 660.3 | | | 244.1 | | | Total short-term debt | $ | 740.4 | | | $ | 356.3 | | | Current portion of long-term debt | 85.9 | | | 84.5 | | | Total short-term debt and current portion of long-term debt (3) | $ | 826.3 | | | $ | 440.8 | | \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(1)At September 30, 2022, the average effective interest rate on the borrowings was 16.8 percent.(2)At September 30, 2022, the average effective interest rate on the borrowings was 3.52 percent.(3)Based on cash generated from operations, our existing liquidity facilities, which includes the revolving credit agreement with the option to increase capacity up to $2.75 billion, and our continued access to debt capital markets, we have adequate liquidity to meet any of the company's debt obligations in the near term. Long-term debt: | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | (in Millions) | September 30, 2022 | | | | | | Interest Rate Percentage | | MaturityDate | | September 30, 2022 | | December 31, 2021 | | Pollution control and industrial revenue bonds (less unamortized discounts of $0.1 and $0.1, respectively) | 6.45% | | 2032 | | $ | 49.9 | | | $ | 49.9 | | | Senior notes (less unamortized discount of $0.6 and $0.7, respectively) | 3.20% - 4.50% | | 2024 - 2049 | | 1,899.4 | | | 1,899.3 | | | | | | | | | | | | 2021 Term Loan Facility | 4.15% | | 2024 | | 800.0 | | | 800.0 | | | Revolving Credit Facility (1) | 5.80% | | 2027 | | — | | | — | | | | | | | | | | | | Foreign debt | 0% - 15.30% | | 2023 - 2024 | | 85.9 | | | 84.7 | | | Debt issuance cost | | | | | (16.8) | | | (17.7) | | | Total long-term debt | | | | | $ | 2,818.4 | | | $ | 2,816.2 | | | Less: debt maturing within one year | | | | | 85.9 | | | 84.5 | | | Total long-term debt, less current portion | | | | | $ | 2,732.5 | | | $ | 2,731.7 | | \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(1)Letters of credit outstanding under our Revolving Credit Facility totaled $160.0 million and available funds under this facility were $1,179.7 million at September 30, 2022. Revolving Credit Facility and Term Loan AmendmentsOn June 17, 2022, we amended our Revolving Credit Facility and on June 27, 2022 we amended our 2021 Term Loan Agreement. The Revolving Credit Facility Amendment primarily increased the borrowing capacity from $1.5 billion to $2 billion and extended the maturity date by an additional year to 2027. Both agreements were amended to transition from a reference rate using the LIBOR benchmark to a reference rate using a Term SOFR benchmark. Deferred financing fees totaling $1.5 million associated with both amendments have been deferred and are being recognized to interest expense over the life of the agreements. CovenantsAmong other restrictions, our Revolving Credit Facility and 2021 Term Loan Facility contain financial covenants applicable to FMC and its consolidated subsidiaries related to leverage (measured as the ratio of debt to adjusted earnings) and interest coverage (measured as the ratio of adjusted earnings to interest expense). Our actual leverage for the four consecutive quarters ended September 30, 2022 was 2.84, which is below the maximum leverage of 3.50 at September 30, 2022. As amended pursuant to the Revolving Credit Agreement discussed within our 2021 Form 10-K, the maximum leverage ratio stepped down to 3.50 for the period ending December 31, 2021 and future quarters thereafter. Our actual interest coverage for the four consecutive quarters ended September 30, 2022 was 9.35, which is above the minimum interest coverage of 3.50. We were in compliance with all covenants at September 30, 2022. 30

string

Issuance of ordinary shares

15

SEC-NUM

[Table of Contents](#i5ec3aabfaa534f9c8fa2d2a5b7677d19_7) APTIV PLCCONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Year Ended December 31, | | | Ordinary Shares | | Preferred Shares | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Number of Shares | | Amount of Shares | | Number of Shares | | Amount of Shares | | AdditionalPaid inCapital | | RetainedEarnings | | AccumulatedOtherComprehensive Loss | | Total AptivShareholders’Equity | | NoncontrollingInterest | | TotalShareholders’Equity | | 2021 | (in millions) | | Balance at January 1, 2021 | 270 | | | $ | 3 | | | 12 | | | $ | — | | | $ | 3,897 | | | $ | 4,550 | | | $ | (545) | | | $ | 7,905 | | | $ | 195 | | | $ | 8,100 | | | Net income | — | | | — | | | — | | | — | | | — | | | 590 | | | — | | | 590 | | | 19 | | | 609 | | | Other comprehensive loss | — | | | — | | | — | | | — | | | — | | | — | | | (127) | | | (127) | | | — | | | (127) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Mandatory convertible preferred share cumulative dividends | — | | | — | | | — | | | — | | | — | | | (63) | | | — | | | (63) | | | — | | | (63) | | | Taxes withheld on employees’ restricted share award vestings | — | | | — | | | — | | | — | | | (45) | | | — | | | — | | | (45) | | | — | | | (45) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Share-based compensation | 1 | | | — | | | — | | | — | | | 87 | | | — | | | — | | | 87 | | | — | | | 87 | | | | | | | | | | | | | | | | | | | | | | | | Balance at December 31, 2021 | 271 | | | $ | 3 | | | 12 | | | $ | — | | | $ | 3,939 | | | $ | 5,077 | | | $ | (672) | | | $ | 8,347 | | | $ | 214 | | | $ | 8,561 | | | | | | | | | | | | | | | | | | | | | | | | 2020 | | | | | | | | | | | | | | | | | | | | | Balance at January 1, 2020 | 255 | | | $ | 3 | | | — | | | $ | — | | | $ | 1,645 | | | $ | 2,890 | | | $ | (719) | | | $ | 3,819 | | | $ | 192 | | | $ | 4,011 | | | Net income | — | | | — | | | — | | | — | | | — | | | 1,804 | | | — | | | 1,804 | | | 18 | | | 1,822 | | | Other comprehensive income | — | | | — | | | — | | | — | | | — | | | — | | | 174 | | | 174 | | | 2 | | | 176 | | | Dividends on ordinary shares | — | | | — | | | — | | | — | | | 1 | | | (57) | | | — | | | (56) | | | — | | | (56) | | | Dividend payments of consolidated affiliates to minority shareholders | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (17) | | | (17) | | | Mandatory convertible preferred share cumulative dividends | — | | | — | | | — | | | — | | | — | | | (35) | | | — | | | (35) | | | — | | | (35) | | | Taxes withheld on employees’ restricted share award vestings | — | | | — | | | — | | | — | | | (33) | | | — | | | — | | | (33) | | | — | | | (33) | | | Repurchase of ordinary shares | (1) | | | — | | | — | | | — | | | (6) | | | (51) | | | — | | | (57) | | | — | | | (57) | | | Issuance of ordinary shares | 15 | | | — | | | — | | | — | | | 1,115 | | | — | | | — | | | 1,115 | | | — | | | 1,115 | | | Issuance of mandatory convertible preferred shares | — | | | — | | | 12 | | | — | | | 1,115 | | | — | | | — | | | 1,115 | | | — | | | 1,115 | | | | | | | | | | | | | | | | | | | | | | | | Share-based compensation | 1 | | | — | | | — | | | — | | | 60 | | | — | | | — | | | 60 | | | — | | | 60 | | | Adjustment for recently adopted accounting pronouncements | — | | | — | | | — | | | — | | | — | | | (1) | | | — | | | (1) | | | — | | | (1) | | | Balance at December 31, 2020 | 270 | | | $ | 3 | | | 12 | | | $ | — | | | $ | 3,897 | | | $ | 4,550 | | | $ | (545) | | | $ | 7,905 | | | $ | 195 | | | $ | 8,100 | | See notes to consolidated financial statements.68

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Risk-free rate

1.44

SEC-NUM

[Table of Contents](#i31241139a24240ee889881d54ce4b5f1_7)Diamondback Energy, Inc. and Subsidiaries Condensed Notes to Consolidated Financial Statements - (Continued)(Unaudited)Restricted Stock Units The following table presents the Company’s restricted stock unit activity during the six months ended June 30, 2022 under the Equity Plan: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | Restricted Stock Units | | Weighted Average Grant-DateFair Value | | Unvested at December 31, 2021 | 1,079,589 | | | $ | 62.09 | | | Granted | 319,035 | | | $ | 132.84 | | | Vested | (178,185) | | | $ | 92.82 | | | Forfeited | (39,231) | | | $ | 68.58 | | | Unvested at June 30, 2022 | 1,181,208 | | | $ | 76.35 | | The aggregate fair value of restricted stock units that vested during the six months ended June 30, 2022 was $17 million. As of June 30, 2022, the Company’s unrecognized compensation cost related to unvested restricted stock units was $70 million, which is expected to be recognized over a weighted-average period of 1.9 years. Performance Based Restricted Stock Units The following table presents the Company’s performance restricted stock units activity under the Equity Plan for the six months ended June 30, 2022: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | Performance Restricted Stock Units | | Weighted Average Grant-Date Fair Value | | Unvested at December 31, 2021 | 456,459 | | | $ | 100.17 | | | Granted | 126,905 | | | $ | 237.13 | | | | | | | | | | | | | Unvested at June 30, 2022(1) | 583,364 | | | $ | 129.96 | | (1)A maximum of 1,408,973 units could be awarded based upon the Company’s final TSR ranking. As of June 30, 2022, the Company’s unrecognized compensation cost related to unvested performance based restricted stock awards and units was $45 million, which is expected to be recognized over a weighted-average period of 1.6 years. In March 2022, eligible employees received performance restricted stock unit awards totaling 126,905 units from which a minimum of 0% and a maximum of 200% of the units could be awarded based upon the measurement of total stockholder return of the Company’s common stock as compared to a designated peer group during the 3-year performance period of January 1, 2022 to December 31, 2024 and cliff vest at December 31, 2024 subject to continued employment. The initial payout of the March 2022 awards will be further adjusted by a TSR modifier that may reduce the payout or increase the payout up to a maximum of 250%. The fair value of each performance restricted stock unit issuance is estimated at the date of grant using a Monte Carlo simulation, which results in an expected percentage of units to be earned during the performance period. The following table presents a summary of the grant-date fair values of performance restricted stock units granted and the related assumptions for the awards granted during the period presented: | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | 2022 | | | | | | Grant-date fair value | $ | 237.13 | | | | | | | | | | | | | | Risk-free rate | 1.44 | % | | | | | | Company volatility | 72.10 | % | | | | | 19

string

State operating loss carryforwards

812

SEC-NUM

The following table presents the tax effects of temporary differences that give rise to significant portions of the Company’s deferred tax assets and liabilities: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | December 31, | | (in millions) | 2021 | | 2020 | | Deferred tax assets: | | | | | Other comprehensive income | $227 | | | $29 | | | Allowance for credit losses | 448 | | | 622 | | | State net operating loss carryforwards | 50 | | | 71 | | | Accrued expenses not currently deductible | 676 | | | 77 | | | Investment and other tax credit carryforwards | 110 | | | 99 | | | | | | | | Total deferred tax assets | 1,511 | | | 898 | | | Valuation allowance | (103) | | | (98) | | | Deferred tax assets, net of valuation allowance | 1,408 | | | 800 | | | Deferred tax liabilities: | | | | | Leasing transactions | 331 | | | 459 | | | Amortization of intangibles | 379 | | | 376 | | | Depreciation | 256 | | | 262 | | | Pension and other employee compensation plans | 132 | | | 107 | | | Partnerships | 95 | | | 76 | | | Deferred Income | 85 | | | 62 | | | MSRs | 130 | | | 87 | | | Total deferred tax liabilities | 1,408 | | | 1,429 | | | Net deferred tax liability | $— | | | $629 | | Deferred tax assets are recognized for net operating loss carryforwards and tax credit carryforwards. Valuation allowances are recorded as necessary to reduce deferred tax assets to the amounts that management concludes are more likely than not to be realized.At December 31, 2021, the Company had state tax net operating loss carryforwards of $812 million. Limitations on the ability to realize these carryforwards are reflected in the associated valuation allowance. At December 31, 2021, the Company had a valuation allowance of $103 million against various deferred tax assets related to state net operating losses and state tax credits, as it is management’s current assessment that it is more likely than not that the Company will not recognize a portion of the deferred tax assets related to these items. The valuation allowance increased $5 million during the year ended December 31, 2021. Effective with the fiscal year ended September 30, 1997, the reserve method for bad debts was no longer permitted for tax purposes. The repeal of the reserve method required the recapture of the reserve balance in excess of certain base year reserve amounts attributable to years ended prior to 1988. At December 31, 2021, the Company’s base year loan loss reserves attributable to years ended prior to 1988, for which no deferred income taxes have been provided, was $557 million. This base year reserve may become taxable if certain distributions are made with respect to the stock of the Company or if the Company ceases to qualify as a bank for tax purposes. No actions are planned that would cause this reserve to become wholly or partially taxable. Citizens files income tax returns in the U.S. federal jurisdiction and in various state and local jurisdictions. With few exceptions, the Company is no longer subject to U.S. federal or state and local income tax examinations by major tax authorities for years before 2018. | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | Citizens Financial Group, Inc. | 144 |

string

Due after ten years, Amortized Cost

6,071

SEC-NUM

Residential mortgage-backed securities: An allowance for credit loss was established on certain residential mortgage-backed securities. Notification of maturity and coupon default, as well as a significant and sustained decline in fair value, were factors to indicate a credit loss. Unrealized losses on our other residential mortgage-backed securities were largely due to market conditions and rising interest rates; however, qualitative factors did not indicate a credit loss. We do not intend to sell these investments and it is likely we will not be required to sell these investments prior to maturity or recovery of amortized cost.As for the remaining securities shown in the table above, unrealized losses on these securities have not been recognized into income because we do not intend to sell these investments and it is likely that we will not be required to sell these investments prior to their anticipated recovery. The decline in fair value is largely due to changes in interest rates and other market conditions. We have evaluated these securities for any change in credit rating and have determined that no allowance is necessary. The fair value is expected to recover as the securities approach maturity.The table below presents a roll-forward by major security type of the allowance for credit losses on fixed maturity securities available-for-sale held at period end for the three months March 31, 2022 and 2021: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended March 31, 2022 | | | | | Foreign government securities | | Corporate securities | | Residential mortgage-backed securities | | Total | | | | | | | | Allowance for credit losses: | | | | | | | | | | | | | | | Beginning balance | $ | — | | | $ | 4 | | | $ | 2 | | | $ | 6 | | | | | | | | | Additions for securities for which no previous expected credit losses were recognized | 3 | | | 4 | | | — | | | 7 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Total allowance for credit losses, ending balance | $ | 3 | | | $ | 8 | | | $ | 2 | | | $ | 13 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended March 31, 2021 | | | | | Corporate securities | | Residential mortgage-backed securities | | Total | | | | | | | | Allowance for credit losses: | | | | | | | | | | | | | Beginning balance | $ | 7 | | | $ | — | | | $ | 7 | | | | | | | | | Additions for securities for which no previous expected credit losses were recognized | 1 | | | — | | | 1 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (Decreases) increases to the allowance for credit losses on securities | (2) | | | 2 | | | — | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Total allowance for credit losses, ending balance | $ | 6 | | | $ | 2 | | | $ | 8 | | | | | | | | The amortized cost and fair value of fixed maturity securities at March 31, 2022, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities because the issuers of the securities may have the right to prepay obligations. | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | AmortizedCost | | EstimatedFair Value | | Due in one year or less | $ | 1,257 | | | $ | 1,254 | | | Due after one year through five years | 6,686 | | | 6,569 | | | Due after five years through ten years | 9,225 | | | 8,905 | | | Due after ten years | 6,071 | | | 5,904 | | | Mortgage-backed securities | 4,344 | | | 4,183 | | | Total fixed maturity securities | $ | 27,583 | | | $ | 26,815 | | -14-

string

Contract With Customer, Asset, Foreign Currency Translation

16

SEC-NUM

[Table of Contents](#i3788981a52d64e719f4aa81d6ab63fcb_7) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months EndedSeptember 30, 2021 | | Nine Months EndedSeptember 30, 2021 | | | | | | (in millions) | | FS | | HS | | P&R | | CMT | | Total | | FS | | HS | | P&R | | CMT | | Total | | Revenues | | | | | | | | | | | | | | | | | | | | | | Geography: | | | | | | | | | | | | | | | | | | | | | | North America | | $ | 1,075 | | | $ | 1,162 | | | $ | 749 | | | $ | 500 | | | $ | 3,486 | | | $ | 3,137 | | | $ | 3,394 | | | $ | 2,190 | | | $ | 1,420 | | | $ | 10,141 | | | United Kingdom | | 140 | | | 44 | | | 125 | | | 121 | | | 430 | | | 395 | | | 129 | | | 347 | | | 332 | | | 1,203 | | | Continental Europe | | 187 | | | 118 | | | 145 | | | 34 | | | 484 | | | 565 | | | 356 | | | 380 | | | 121 | | | 1,422 | | | Europe - Total | | 327 | | | 162 | | | 270 | | | 155 | | | 914 | | | 960 | | | 485 | | | 727 | | | 453 | | | 2,625 | | | Rest of World | | 142 | | | 30 | | | 88 | | | 84 | | | 344 | | | 407 | | | 88 | | | 243 | | | 226 | | | 964 | | | Total | | $ | 1,544 | | | $ | 1,354 | | | $ | 1,107 | | | $ | 739 | | | $ | 4,744 | | | $ | 4,504 | | | $ | 3,967 | | | $ | 3,160 | | | $ | 2,099 | | | $ | 13,730 | | | | | | | | | | | | | | | | | | | | | | | | | Service line: | | | | | | | | | | | | | | | | | | | | | | Consulting and technology services | | $ | 1,049 | | | $ | 785 | | | $ | 715 | | | $ | 441 | | | $ | 2,990 | | | $ | 3,028 | | | $ | 2,299 | | | $ | 1,999 | | | $ | 1,259 | | | $ | 8,585 | | | Outsourcing services | | 495 | | | 569 | | | 392 | | | 298 | | | 1,754 | | | 1,476 | | | 1,668 | | | 1,161 | | | 840 | | | 5,145 | | | Total | | $ | 1,544 | | | $ | 1,354 | | | $ | 1,107 | | | $ | 739 | | | $ | 4,744 | | | $ | 4,504 | | | $ | 3,967 | | | $ | 3,160 | | | $ | 2,099 | | | $ | 13,730 | | | | | | | | | | | | | | | | | | | | | | | | | Type of contract: | | | | | | | | | | | | | | | | | | | | | | Time and materials | | $ | 922 | | | $ | 515 | | | $ | 468 | | | $ | 437 | | | $ | 2,342 | | | $ | 2,729 | | | $ | 1,548 | | | $ | 1,332 | | | $ | 1,256 | | | $ | 6,865 | | | Fixed-price | | 527 | | | 554 | | | 530 | | | 265 | | | 1,876 | | | 1,498 | | | 1,582 | | | 1,517 | | | 744 | | | 5,341 | | | Transaction or volume-based | | 95 | | | 285 | | | 109 | | | 37 | | | 526 | | | 277 | | | 837 | | | 311 | | | 99 | | | 1,524 | | | Total | | $ | 1,544 | | | $ | 1,354 | | | $ | 1,107 | | | $ | 739 | | | $ | 4,744 | | | $ | 4,504 | | | $ | 3,967 | | | $ | 3,160 | | | $ | 2,099 | | | $ | 13,730 | | | | | | | | | | | | | | | | | | | | | | | | Costs to FulfillCosts to fulfill, such as setup or transition activities, are recorded in "Other noncurrent assets" in our unaudited consolidated statements of financial position and the amortization expense of costs to fulfill is included in "Cost of revenues" in our unaudited consolidated statements of operations. Costs to obtain contracts were immaterial for the periods disclosed. The following table presents information related to the capitalized costs to fulfill for the nine months ended September 30: | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | (in millions) | | 2022 | | 2021 | | Beginning balance | | $ | 394 | | | $ | 467 | | | Costs capitalized | | 29 | | | 38 | | | Amortization expense | | (82) | | | (88) | | | Impairment charge | | — | | | (11) | | | Ending balance | | $ | 341 | | | $ | 406 | | Contract BalancesA contract asset is a right to consideration that is conditional upon factors other than the passage of time. Contract assets are presented in "Other current assets" in our unaudited consolidated statements of financial position and primarily relate to unbilled amounts on fixed-price contracts utilizing the cost-to-cost method of revenue recognition. The table below shows movements in contract assets for the nine months ended September 30: | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | (in millions) | | 2022 | | 2021 | | Beginning balance | | $ | 310 | | | $ | 315 | | | Revenues recognized during the period but not billed | | 377 | | | 298 | | | Amounts reclassified to trade accounts receivable | | (287) | | | (264) | | | Effect of foreign currency exchange movements | | (16) | | | — | | | Ending balance | | $ | 384 | | | $ | 349 | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | Cognizant Technology Solutions | 9 | September 30, 2022 Form 10-Q |

string

Other contractual commitments, Due in 2024

148

SEC-NUM

[Table of Contents](#i02bedaa3ef9a402693e3fc0f0d740b61_7) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Fiscal Quarter Ended | | Three Fiscal Quarters Ended | | | | July 31,2022 | | August 1,2021 | | July 31,2022 | | August 1,2021 | | | | | | | | | | | | | | (In millions) | | Net revenue: | | | | | | | | | | Semiconductor solutions | | $ | 6,624 | | | $ | 5,021 | | | $ | 18,726 | | | $ | 14,749 | | | Infrastructure software | | 1,840 | | | 1,757 | | | 5,547 | | | 5,294 | | | Total net revenue | | $ | 8,464 | | | $ | 6,778 | | | $ | 24,273 | | | $ | 20,043 | | | | | | | | | | | | | Operating income: | | | | | | | | | | Semiconductor solutions | | $ | 3,916 | | | $ | 2,720 | | | $ | 10,891 | | | $ | 7,828 | | | Infrastructure software | | 1,283 | | | 1,226 | | | 3,903 | | | 3,700 | | | Unallocated expenses | | (1,462) | | | (1,820) | | | (4,555) | | | (5,590) | | | Total operating income | | $ | 3,737 | | | $ | 2,126 | | | $ | 10,239 | | | $ | 5,938 | | 11. Commitments and ContingenciesCommitmentsThe following table summarizes contractual obligations and commitments as of July 31, 2022 that materially changed from the end of fiscal year 2021: | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | Fiscal Year: | | Purchase Commitments | | Other Contractual Commitments | | | | | | | | | | (In millions) | | 2022 (remainder) | | $ | 42 | | | $ | 554 | | | 2023 | | 178 | | | 185 | | | 2024 | | 159 | | | 148 | | | 2025 | | 79 | | | 36 | | | 2026 | | 9 | | | 50 | | | Thereafter | | 7 | | | 1 | | | Total | | $ | 474 | | | $ | 974 | | Purchase Commitments. Represent unconditional purchase obligations that are enforceable and legally binding on us and specify all significant terms, including fixed or minimum quantities to be purchased, price provisions, and the approximate timing of the transaction. These commitments include agreements to purchase inventory and other goods or services. Purchase obligations exclude agreements that are cancelable without penalty and unconditional purchase obligations with a remaining term of one year or less.Other Contractual Commitments. Represent amounts payable pursuant to agreements related to IT, human resources, and other service agreements.Due to the inherent uncertainty with respect to the timing of future cash outflows associated with our unrecognized tax benefits at July 31, 2022, we are unable to reliably estimate the timing of cash settlement with the respective taxing authorities. Therefore, $3,307 million of unrecognized tax benefits and accrued interest and penalties as of July 31, 2022 have been excluded from the table above.21

string

Total

112,280

SEC-NUM

NOTE 8. LEASES Maturities of operating lease liabilities were as follows: | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | (in thousands) | September 30, 2022 | | | | | 2022 (remainder of year) | $ | 4,472 | | | 2023 | 23,458 | | | 2024 | 19,693 | | | 2025 | 15,629 | | | 2026 | 13,098 | | | Thereafter | 53,809 | | | Total lease payments | 130,159 | | | Less imputed interest | (17,879) | | | Total | $ | 112,280 | | Total minimum future lease payments for leases that have not commenced as of September 30, 2022, are approximately $7.9 million, and those leases will commence between 2022 and 2024. Supplemental cash flow information for leases was as follows: | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | (in thousands) | | For the Nine Months EndedSeptember 30, 2022 | | For the Nine Months EndedSeptember 30, 2021 | | | | | | | | Cash paid for amounts included in the measurement of operating leases liabilities | | $ | 17,715 | | | $ | 17,232 | | | Right-of-use assets obtained in exchange for operating lease obligations, net of earlylease terminations | | $ | 26,040 | | | $ | 33,052 | | NOTE 9. OTHER CURRENT AND LONG-TERM ASSETS Other current assets consisted of the following: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | (in thousands) | September 30, 2022 | | December 31, 2021 | | | | | | | Customer acquisition costs | $ | 49,834 | | | $ | 48,942 | | | Contract assets, net (1) | 42,255 | | | 37,772 | | | Prepaid expenses | 39,696 | | | 41,997 | | | Taxes receivable | 22,570 | | | 19,464 | | | Foreign currency exchange contracts | 22,331 | | | 6,512 | | | Cross currency swap contracts | 15,994 | | | — | | | Deferred sales commissions | 6,438 | | | 6,475 | | | Other assets | 17,518 | | | 12,661 | | | Other current assets | $ | 216,636 | | | $ | 173,823 | | (1) Contract assets, net, are net of allowances for credit loss. Refer to "Note 6. Credit Losses."19

string

Related Party Transaction, Amounts of Transaction

24

SEC-NUM

[Table of Co](#i2c056a9f8317485ea6601862f5b0559f_7)[ntents](#i2c056a9f8317485ea6601862f5b0559f_7)Electric Transmission Maintenance and Construction AgreementsATXI entered into separate agreements with Ameren Missouri and Ameren Illinois in which Ameren Missouri or Ameren Illinois, as applicable, may perform certain maintenance and construction services related to ATXI’s electric transmission assets.Money PoolSee Note 4 – Short-term Debt and Liquidity for a discussion of affiliate borrowing arrangements.Software Licensing AgreementIn September 2019, Ameren Missouri purchased a license for advanced metering infrastructure software from Ameren Illinois. The amount of the $24 million cost-based transaction price over the $5 million remaining carrying value of the software was recorded as revenue by Ameren Illinois, with $14 million of revenue recorded at Ameren Illinois Electric Distribution and $5 million recorded at Ameren Illinois Natural Gas. The revenue recorded at Ameren Illinois Electric Distribution was reflected in formula ratemaking, which resulted in no impact to net income. Per authoritative accounting guidance for sales to rate-regulated entities, the revenue recognized by Ameren Illinois was not eliminated upon consolidation by Ameren. Ameren Missouri’s cost-based investment of $24 million was included in “Property, Plant, and Equipment, Net.”Tax Allocation AgreementSee Note 1 – Summary of Significant Accounting Policies for a discussion of the tax allocation agreement. The following table presents the affiliate balances related to income taxes for Ameren Missouri and Ameren Illinois as of December 31, 2021 and December 31, 2020: | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | 2021 | | | 2020 | | | Ameren Missouri | Ameren Illinois | | | Ameren Missouri | Ameren Illinois | | Income taxes payable to parent(a) | $ | — | | $ | 8 | | | | $ | — | | $ | 6 | | | Income taxes receivable from parent(b) | 27 | | 18 | | | | 9 | | 15 | | (a)Included in “Accounts payable – affiliates” on the balance sheet.(b)Included in “Accounts receivable – affiliates” on the balance sheet.Capital ContributionsThe following table presents cash capital contributions received from Ameren (parent) by Ameren Missouri and Ameren Illinois for the years ended December 31, 2021, 2020, and 2019: | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | 2021 | | 2020 | | 2019 | | | Ameren Missouri(a) | $ | 207 | | | $ | 491 | | | $ | 124 | | | | Ameren Illinois(a) | 262 | | | 464 | | | 15 | | | (a)Includes capital contributions made as a result of the tax allocation agreement.146

string

Unrecognized tax benefits that would impact the effective tax rate, net of tax benefits

465

SEC-NUM

[Table of Contents](#i43d04c9d26874e33802bdf64c458414a_7)Chile Tax Matters. In September 2014, the Chile legislature approved a tax reform package that implemented a dual tax system, which was amended in January 2016. Under previous rules, FCX’s share of income from Chile operations was subject to an effective 35 percent tax rate allocated between income taxes and dividend withholding taxes. Under the amended tax reform package, FCX’s Chile operation is subject to the “Partially-Integrated System,” resulting in FCX’s share of income from El Abra being subject to progressively increasing effective tax rates of 35 percent through 2019 and 44.5 percent in 2020 and thereafter. In November 2017, the progression of increasing tax rates was delayed by the Chile legislature so that the 35 percent rate continued through 2021, increasing to 44.5 percent in 2022 and thereafter. In January 2020, the Chile legislature approved a tax reform package that would further delay the 44.5 percent rate until 2027 and thereafter. In 2010, the Chile legislature approved an increase in mining royalty taxes to help fund earthquake reconstruction activities, education and health programs. Beginning in 2018, and through 2023 mining royalty rates at FCX’s El Abra mine are based on a sliding scale of 5 to 14 percent (depending on a defined operational margin). Uncertain Tax Positions. FCX accounts for uncertain income tax positions using a threshold and measurement criteria for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. FCX’s policy associated with uncertain tax positions is to record accrued interest in interest expense and accrued penalties in other (expense) income, net rather than in the provision for income taxes. A summary of the activities associated with FCX’s reserve for unrecognized tax benefits for the years ended December 31 follows. The balance at year-end December 31, 2019, was revised by $115 million and the balance at year-end December 31, 2020, was revised by $179 million to adjust for amounts paid on accruals not yet settled. | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | 2021 | | 2020 | | 2019 | | Balance at beginning of year | $ | 474 | | | $ | 491 | | | $ | 494 | | | Additions: | | | | | | | Prior year tax positions | 330 | | | 56 | | | 86 | | | Current year tax positions | 71 | | | 60 | | | 11 | | | | | | | | | | Decreases: | | | | | | | Prior year tax positions | (30) | | | (82) | | | (75) | | | | | | | | | | Settlements with taxing authorities | (37) | | | (51) | | | (25) | | | | | | | | | | | | | | | | | Balance at end of year | $ | 808 | | | $ | 474 | | | $ | 491 | | The total amount of accrued interest and penalties associated with unrecognized tax benefits was $620 million at December 31, 2021, primarily relating to unrecognized tax benefits associated with cost recovery methods and royalties and other related mining taxes, and $307 million at December 31, 2020, and $339 million at December 31, 2019. The reserve for unrecognized tax benefits of $808 million at December 31, 2021, included $694 million ($465 million net of income tax benefits and valuation allowances) that, if recognized, would reduce FCX’s provision for income taxes. Changes in the reserve for unrecognized tax benefits associated with current and prior-year tax positions were primarily related to uncertainties associated with FCX's tax treatment of cost recovery methods. There continues to be uncertainty related to the timing of settlements with taxing authorities, but if additional settlements are agreed upon during the year 2022, FCX could experience a change in its reserve for unrecognized tax benefits. FCX or its subsidiaries file income tax returns in the U.S. federal jurisdiction and various state and foreign jurisdictions. The tax years for FCX’s major tax jurisdictions that remain subject to examination are as follows: | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | Jurisdiction | | Years Subject to Examination | | Additional Open Years | | U.S. Federal | | 2017-2018 | | 2014-2016, 2019-2021 | | Indonesia | | 2011-2018 | | 2020-2021 | | Peru | | 2016 | | 2017-2021 | | Chile | | 2020 | | 2018-2019, 2021 | | | | | | | 146

string

Purchase of noncontrolling interests

11.2

SEC-NUM

EQUIFAX INC.CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Nine Months Ended September 30, | | | | 2022 | | 2021 | | | | (In millions) | | Operating activities: | | | | | | Consolidated net income | | $ | 591.1 | | | $ | 625.5 | | | Adjustments to reconcile consolidated net income to net cash provided by operating activities: | | | | | | | | | | | | Depreciation and amortization | | 424.1 | | | 354.9 | | | Stock-based compensation expense | | 50.4 | | | 44.8 | | | | | | | | | Deferred income taxes | | 47.9 | | | 12.6 | | | (Gain) loss on fair market value adjustment and gain on sale of equity investment | | (20.2) | | | 0.1 | | | Gain on divestiture | | — | | | (0.2) | | | Changes in assets and liabilities, excluding effects of acquisitions: | | | | | | Accounts receivable, net | | (133.6) | | | (54.9) | | | Other assets, current and long-term | | (32.0) | | | 5.1 | | | Current and long term liabilities, excluding debt | | (496.0) | | | (38.4) | | | Cash provided by operating activities | | 431.7 | | | 949.5 | | | Investing activities: | | | | | | Capital expenditures | | (468.4) | | | (332.9) | | | Acquisitions, net of cash acquired | | (437.5) | | | (1,108.9) | | | | | | | | | Cash received from divestitures | | 98.8 | | | 1.5 | | | | | | | | | Cash used in investing activities | | (807.1) | | | (1,440.3) | | | Financing activities: | | | | | | Net short-term (repayments) borrowings | | (162.1) | | | 499.2 | | | Payments on long-term debt | | — | | | (1,100.2) | | | Borrowings on long-term debt | | 749.3 | | | 1,697.3 | | | Treasury stock purchases | | — | | | (69.9) | | | Dividends paid to Equifax shareholders | | (143.3) | | | (142.6) | | | Dividends paid to noncontrolling interests | | (2.5) | | | (6.5) | | | Proceeds from exercise of stock options and employee stock purchase plan | | 13.5 | | | 33.4 | | | Payment of taxes related to settlement of equity awards | | (33.0) | | | (43.9) | | | | | | | | | Purchase of noncontrolling interests | | — | | | (11.2) | | | Debt issuance costs | | (5.4) | | | (13.2) | | | | | | | | | | | | | | | Cash provided by financing activities | | 416.5 | | | 842.4 | | | Effect of foreign currency exchange rates on cash and cash equivalents | | (24.1) | | | (10.7) | | | Decrease in cash and cash equivalents | | 17.0 | | | 340.9 | | | Cash and cash equivalents, beginning of period | | 224.7 | | | 1,684.6 | | | Cash and cash equivalents, end of period | | $ | 241.7 | | | $ | 2,025.5 | | See Notes to Consolidated Financial Statements.8

string

Business acquisition, share price (in usd per share)

95.00

SEC-NUM

[Table of Contents](#i8fbc3dcd16fb4e35b37f64f296545b43_13)ACTIVISION BLIZZARD, INC. AND SUBSIDIARIESNotes to Condensed Consolidated Financial Statements (Unaudited) 1. Description of Business and Basis of Consolidation and Presentation Activision Blizzard, Inc. is a leading global developer and publisher of interactive entertainment content and services. We develop and distribute content and services on video game consoles, personal computers (“PCs”), and mobile devices. We also operate esports leagues and offer digital advertising within some of our content. The terms “Activision Blizzard,” the “Company,” “we,” “us,” and “our” are used to refer collectively to Activision Blizzard, Inc. and its subsidiaries. Merger Agreement On January 18, 2022, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Microsoft Corporation (“Microsoft”) and Anchorage Merger Sub Inc. (“Merger Sub”), a wholly owned subsidiary of Microsoft. Subject to the terms and conditions of the Merger Agreement, Microsoft agreed to acquire the Company for $95.00 per issued and outstanding share of our common stock, par value $0.000001 per share, in an all-cash transaction. Pursuant to the Merger Agreement, following consummation of the merger of Merger Sub with and into the Company (the “Merger”), the Company will be a wholly-owned subsidiary of Microsoft. As a result of the Merger, we will cease to be a publicly traded company. We have agreed to various customary covenants and agreements, including, among others, agreements to conduct our business in the ordinary course during the period between the execution of the Merger Agreement and the effective time of the Merger (the “Effective Time”). We do not believe these restrictions will prevent us from meeting our debt service obligations, ongoing costs of operations, working capital needs or capital expenditure requirements. The consummation of the Merger remains subject to customary closing conditions, including satisfaction of certain regulatory approvals. On April 28, 2022, the Company’s stockholders adopted the Merger Agreement at a special meeting of stockholders. The Merger is currently expected to close in Microsoft’s fiscal year ending June 30, 2023. For additional information related to the Merger Agreement, please refer to the Definitive Proxy Statement on Schedule 14A filed with the SEC on March 21, 2022, as supplemented by the Current Report on Form 8-K filed with the SEC on April 15, 2022, as well as [P](http://www.sec.gov/ix?doc=/Archives/edgar/data/0000718877/000162828022003992/atvi-20211231.htm#i6918bdee1491433a92115eff89e52c46_142)[art I Item 1 “Business” of our Annual Report on](http://www.sec.gov/ix?doc=/Archives/edgar/data/0000718877/000162828022003992/atvi-20211231.htm#i6918bdee1491433a92115eff89e52c46_142) [Form 10-K for the year ended December 31, 2021](http://www.sec.gov/ix?doc=/Archives/edgar/data/0000718877/000162828022003992/atvi-20211231.htm#i6918bdee1491433a92115eff89e52c46_142), and other relevant materials in connection with the proposed transaction with Microsoft that we will file with the SEC and that will contain important information about the Company and the Merger. Our Segments Based upon our organizational structure, we conduct our business through three reportable segments, each of which is a leading global developer and publisher of interactive entertainment content and services based primarily on our internally-developed intellectual properties. (i) Activision Publishing, Inc. Activision Publishing, Inc. (“Activision”) delivers content through both premium and free-to-play offerings and primarily generates revenue from full-game and in-game sales, as well as by licensing software to third-party or related-party companies that distribute Activision products. Activision’s key product franchise is Call of Duty®, a first-person action franchise. Activision also includes the activities of the Call of Duty League™, a global professional esports league with city-based teams. (ii) Blizzard Entertainment, Inc. Blizzard Entertainment, Inc. (“Blizzard”) delivers content through both premium and free-to-play offerings and primarily generates revenue from full-game and in-game sales, subscriptions, and by licensing software to third-party or related-party companies that distribute Blizzard products. Blizzard also maintains a proprietary online gaming platform, Battle.net®, which facilitates digital distribution of Blizzard content and selected Activision content, online social connectivity, and the creation of user-generated content. Blizzard’s key product franchises include: Warcraft®, which includes World of Warcraft®, a subscription-based massive multi-player online role-playing game, and Hearthstone®, an online collectible card game based in the Warcraft universe; Diablo®, an action role-playing franchise; and Overwatch®, a team-based first-person action franchise. Blizzard also includes the activities of the Overwatch League™, a global professional esports league with city-based teams. 9

string

2026

1,850,000

SEC-NUM

[Table of Contents](#i754bc30884284e56b9b1a914458fa36e_7) At September 30, 2022, future maturities of long-term debt (excluding finance lease liabilities) are as follows by year (in thousands): | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | Year Ending December 31, | | | | | | 2022 | $ | 9,629 | | | 2023 | 1,139,549 | | | 2024 | 530,777 | | | 2025 | 1,000,000 | | | 2026 | 1,850,000 | | | 2027 | 1,250,000 | | | 2028 and thereafter | 7,700,000 | | | Total | $ | 13,479,955 | | Senior Notes We have $11.9 billion in aggregate principal amount of senior unsecured notes, as presented in the table above. Interest on the senior notes is payable semi-annually at various dates. Each series of the senior notes is redeemable, at our option, in whole or in part, at any time and from time-to-time at the redemption prices set forth in the related indenture. On August 22, 2022, we issued $2.5 billion aggregate principal amount of senior unsecured notes consisting of the following: (i) $500.0 million aggregate principal amount of 4.950% senior notes due August 2027; (ii) $500.0 million aggregate principal amount of 5.300% senior notes due August 2029; (iii) $750.0 million aggregate principal amount of 5.400% senior notes due August 2032; and (iv) $750.0 million aggregate principal amount of 5.950% senior notes due August 2052. We issued the senior notes at a total discount of $5.2 million, and we incurred debt issuance costs of $24.8 million, including underwriting fees, fees for professional services and registration fees, which were capitalized and reflected as a reduction of the related carrying amount of the notes in our consolidated balance sheet at September 30, 2022. Interest on the senior unsecured notes is payable semi-annually in arrears on February 15 and August 15 of each year, commencing February 15, 2023. The notes are unsecured and unsubordinated indebtedness and rank equally in right of payment with all of our other outstanding unsecured and unsubordinated indebtedness. The net proceeds from the offering have been or will be used to refinance the outstanding indebtedness under our credit facility, to make cash payments and pay transaction fees and expenses in connection with the pending acquisition of EVO, to refinance certain outstanding indebtedness of EVO in connection with the acquisition and for general corporate purposes. In the event that the EVO acquisition is not consummated, we will be required to redeem the notes due 2027 and 2029 at a redemption price equal to 101% of the principal amount of the notes due 2027 and 2029 then outstanding plus accrued and unpaid interest, if any. Convertible Notes On August 1, 2022, we entered into an investment agreement with Silver Lake Partners relating to the issuance of $1.5 billion in aggregate principal amount of 1.000% convertible unsecured senior notes (the "Convertible Notes”) due 2029 in a private placement, and the transaction closed on August 8, 2022. The net proceeds from this offering were approximately $1.45 billion, reflecting an issuance discount of $37.5 million and $10.4 million of debt issuance costs, which were capitalized and reflected as a reduction of the related carrying amount of the Convertible Notes in our consolidated balance sheet at September 30, 2022. The Convertible Notes bear interest at a rate of 1.000% per annum. Interest on the Convertible Notes is payable semi-annually in arrears on February 15 and August 15 of each year, beginning on February 15, 2023, to the holders of record on the preceding February 1 and August 1, respectively. The Convertible Notes mature on August 15, 2029, subject to earlier conversion or repurchase. 20

string

Common Stock, Par or Stated Value Per Share

5.00

SEC-NUM

[Table of](#i96cbbb599c964cb4a125b720672b6568_10) [Contents](#i96cbbb599c964cb4a125b720672b6568_10)The Boeing Company and SubsidiariesConsolidated Statements of Financial Position | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | (Dollars in millions, except per share data) | | | | | December 31, | 2021 | | 2020 | | Assets | | | | | Cash and cash equivalents | $8,052 | | | $7,752 | | | Short-term and other investments | 8,192 | | | 17,838 | | | Accounts receivable, net | 2,641 | | | 1,955 | | | Unbilled receivables, net | 8,620 | | | 7,995 | | | Current portion of customer financing, net | 117 | | | 101 | | | Inventories | 78,823 | | | 81,715 | | | Other current assets, net | 2,221 | | | 4,286 | | | Total current assets | 108,666 | | | 121,642 | | | Customer financing, net | 1,695 | | | 1,936 | | | Property, plant and equipment, net | 10,918 | | | 11,820 | | | Goodwill | 8,068 | | | 8,081 | | | Acquired intangible assets, net | 2,562 | | | 2,843 | | | Deferred income taxes | 77 | | | 86 | | | Investments | 975 | | | 1,016 | | | Other assets, net of accumulated amortization of $975 and $729 | 5,591 | | | 4,712 | | | Total assets | $138,552 | | | $152,136 | | | Liabilities and equity | | | | | Accounts payable | $9,261 | | | $12,928 | | | Accrued liabilities | 18,455 | | | 22,171 | | | Advances and progress billings | 52,980 | | | 50,488 | | | Short-term debt and current portion of long-term debt | 1,296 | | | 1,693 | | | Total current liabilities | 81,992 | | | 87,280 | | | Deferred income taxes | 218 | | | 1,010 | | | Accrued retiree health care | 3,528 | | | 4,137 | | | Accrued pension plan liability, net | 9,104 | | | 14,408 | | | Other long-term liabilities | 1,750 | | | 1,486 | | | Long-term debt | 56,806 | | | 61,890 | | | Total liabilities | 153,398 | | | 170,211 | | | Shareholders’ equity: | | | | | Common stock, par value $5.00 – 1,200,000,000 shares authorized; 1,012,261,159 shares issued | 5,061 | | | 5,061 | | | Additional paid-in capital | 9,052 | | | 7,787 | | | Treasury stock, at cost | (51,861) | | | (52,641) | | | Retained earnings | 34,408 | | | 38,610 | | | Accumulated other comprehensive loss | (11,659) | | | (17,133) | | | Total shareholders’ deficit | (14,999) | | | (18,316) | | | Noncontrolling interests | 153 | | | 241 | | | Total equity | (14,846) | | | (18,075) | | | Total liabilities and equity | $138,552 | | | $152,136 | | See Notes to the Consolidated Financial Statements on pages 64 – 123.60

string

Preferred stock, shares authorized (in shares)

100,000,000

SEC-NUM

[Table of Contents](#id353055757fb42afb305a023bc295188_7)CELANESE CORPORATION AND SUBSIDIARIESUNAUDITED CONSOLIDATED BALANCE SHEETS | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | As of June 30, 2022 | | As of December 31,2021 | | | (In $ millions, except share data) | | ASSETS | | | | | Current Assets | | | | | Cash and cash equivalents | 783 | | | 536 | | | Trade receivables - third party and affiliates | 1,317 | | | 1,161 | | | Non-trade receivables, net | 510 | | | 506 | | | Inventories | 1,713 | | | 1,524 | | | | | | | | Marketable securities | 7 | | | 10 | | | | | | | | Other assets | 129 | | | 70 | | | Total current assets | 4,459 | | | 3,807 | | | Investments in affiliates | 935 | | | 823 | | | Property, plant and equipment (net of accumulated depreciation - 2022: $3,497; 2021: $3,484) | 4,158 | | | 4,193 | | | Operating lease right-of-use assets | 264 | | | 236 | | | Deferred income taxes | 232 | | | 248 | | | Other assets | 642 | | | 521 | | | Goodwill | 1,348 | | | 1,412 | | | Intangible assets, net | 675 | | | 735 | | | Total assets | 12,713 | | | 11,975 | | | LIABILITIES AND EQUITY | | | | | Current Liabilities | | | | | Short-term borrowings and current installments of long-term debt - third party and affiliates | 809 | | | 791 | | | Trade payables - third party and affiliates | 1,250 | | | 1,160 | | | Other liabilities | 419 | | | 473 | | | | | | | | Income taxes payable | 117 | | | 81 | | | Total current liabilities | 2,595 | | | 2,505 | | | Long-term debt, net of unamortized deferred financing costs | 3,022 | | | 3,176 | | | Deferred income taxes | 589 | | | 555 | | | Uncertain tax positions | 285 | | | 280 | | | Benefit obligations | 514 | | | 558 | | | Operating lease liabilities | 220 | | | 200 | | | Other liabilities | 263 | | | 164 | | | Commitments and Contingencies | | | | | Stockholders' Equity | | | | | Preferred stock, $0.01 par value, 100,000,000 shares authorized (2022 and 2021: 0 issued and outstanding) | — | | | — | | | Common stock, $0.0001 par value, 400,000,000 shares authorized (2022: 170,050,081 issued and 108,346,035 outstanding; 2021: 169,760,024 issued and 108,023,735 outstanding) | — | | | — | | | | | | | | Treasury stock, at cost (2022: 61,704,046 shares; 2021: 61,736,289 shares) | (5,492) | | | (5,492) | | | Additional paid-in capital | 344 | | | 333 | | | Retained earnings | 10,466 | | | 9,677 | | | Accumulated other comprehensive income (loss), net | (438) | | | (329) | | | Total Celanese Corporation stockholders' equity | 4,880 | | | 4,189 | | | Noncontrolling interests | 345 | | | 348 | | | Total equity | 5,225 | | | 4,537 | | | Total liabilities and equity | 12,713 | | | 11,975 | | See the accompanying notes to the unaudited interim consolidated financial statements.5

string

Total unused lines of credit

560

SEC-NUM

Long-Term Debt Long-term debt was as follows: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Year Ended December 31, | | | | 2021 | | 2020 | | | | Principal | | Interest | | Principal | | Interest | | (in millions except percentages) | | Balance | | Rate | | Balance | | Rate | | | | | | | | | | | | Fixed rate senior notes $450 million due August 2021 | | $ | — | | | — | % | | $ | 296 | | | 4.1 | % | | Private placement notes 70 million euros due October 2024 | | 79 | | | 1.0 | % | | 85 | | | 1.0 | % | | Private placement notes 25 million Swiss franc due December 2025 | | 27 | | | 0.9 | % | | 28 | | | 0.9 | % | | Private placement notes 97 million euros due December 2025 | | 110 | | | 2.1 | % | | 118 | | | 2.1 | % | | Private placement notes 26 million euros due February 2026 | | 30 | | | 2.1 | % | | 32 | | | 2.1 | % | | Private placement notes 58 million Swiss franc due August 2026 | | 64 | | | 1.0 | % | | 65 | | | 1.0 | % | | Private placement notes 106 million euros due August 2026 | | 121 | | | 2.3 | % | | 129 | | | 2.3 | % | | Private placement notes 70 million euros due October 2027 | | 80 | | | 1.3 | % | | 85 | | | 1.3 | % | | Private placement notes 8 million Swiss franc due December 2027 | | 8 | | | 1.0 | % | | 8 | | | 1.0 | % | | Private placement notes 15 million euros due December 2027 | | 17 | | | 2.2 | % | | 18 | | | 2.2 | % | | Private placement notes 140 million Swiss franc due August 2028 | | 153 | | | 1.2 | % | | 158 | | | 1.2 | % | | Private placement notes 70 million euros due October 2029 | | 79 | | | 1.5 | % | | 85 | | | 1.5 | % | | Fixed rate senior notes 750 million due June 2030 | | 750 | | | 3.3 | % | | 750 | | | 3.3 | % | | Private placement notes 70 million euros due October 2030 | | 80 | | | 1.6 | % | | 85 | | | 1.6 | % | | Private placement notes 45 million euros due February 2031 | | 51 | | | 2.5 | % | | 55 | | | 2.5 | % | | Private placement notes 65 million Swiss franc due August 2031 | | 71 | | | 1.3 | % | | 73 | | | 1.3 | % | | Private placement notes 12.6 billion Japanese yen due September 2031 | | 109 | | | 1.0 | % | | 122 | | | 1.0 | % | | Private placement notes 70 million euros due October 2031 | | 80 | | | 1.7 | % | | 85 | | | 1.7 | % | | Other borrowings, various currencies and rates | | 13 | | | | | 7 | | | | | | | $ | 1,922 | | | | | $ | 2,284 | | | | | Less: Current portion | | | | | | | | | | (included in “Notes payable and current portion of long-term debt” in the Consolidated Balance Sheets) | | 1 | | | | | 296 | | | | | Less: Long-term portion of deferred financing costs | | 8 | | | | | 10 | | | | | Long-term portion | | $ | 1,913 | | | | | $ | 1,978 | | | | At December 31, 2021, the Company had $560 million borrowings available under unused lines of credit, including lines available under its short-term arrangements and revolving credit agreement. The Company’s revolving credit facility, term loans and senior notes contain certain affirmative and negative covenants relating to the Company's operations and financial condition. At December 31, 2021, the Company was in compliance with all debt covenants. The table below reflects the contractual maturity dates of the various long-term borrowings as follows: | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | (in millions) | | December 31, 2021 | | 2022 | | $ | 3 | | | 2023 | | 11 | | | 2024 | | 84 | | | 2025 | | 138 | | | 2026 | | 213 | | | 2027 and beyond | | 1,473 | | | | | $ | 1,922 | | 97

string

Estimated refund outstanding

32

SEC-NUM

[Table of Contents](#i2ba0bd92bcb14d27a1d59d9667569d45_7)THE ESTÉE LAUDER COMPANIES INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTSFiscal 2020On December 18, 2019, the Company acquired the remaining 66.66% equity interest in Have&Be Co. Ltd. (“Have & Be”), the global skin care company behind Dr.Jart+ and men’s grooming brand Do The Right Thing, for $1,268 million in cash. Based on the final purchase price and working capital adjustments, the Company estimated a refund receivable of $32 million that was outstanding as of June 30, 2020 and was received in fiscal 2021. The Company originally acquired a minority interest in Have & Be in December 2015, and that investment structure included a formula-based call option for the remaining equity interest. The original minority interest was accounted for as an equity method investment, which had a carrying value of $133 million at the acquisition date. The acquisition of the remaining equity interest in Have & Be was considered a step acquisition, whereby the Company remeasured the previously held equity method investment to its fair value of $660 million, resulting in the recognition of a gain of $530 million. The acquisition of the remaining equity interest also resulted in the recognition of a previously unrealized foreign currency gain of $4 million, which was reclassified from accumulated OCI. The total gain on the Company’s previously held equity method investment of $534 million is included in Other income, net in the accompanying consolidated statements of earnings for fiscal 2020. The fair value of the previously held equity method investment was determined based upon a valuation of the acquired business, as of the date of acquisition, using an equal weighting of the income and market approaches, utilizing estimated cash flows and a terminal value, discounted at a rate of return that reflects the relative risk of the cash flows, as well as valuation multiples derived from comparable publicly traded companies. The accounting for the Have & Be business combination was finalized as of June 30, 2020. The amount paid at closing was funded by cash on hand including the proceeds from the issuance of debt. In anticipation of the closing, the Company transferred cash to a foreign subsidiary for purposes of making the closing payment. As a result, the Company recognized a foreign currency gain of $23 million, which is also included in Other income, net in the accompanying consolidated statements of earnings for the year ended June 30, 2020. NOTE 6 – GOODWILL AND OTHER INTANGIBLE ASSETS As previously discussed in Note 5 – Acquisition of Businesses, in May 2021 the Company increased its investment in DECIEM, which resulted in the inclusion of additional goodwill of $1,296 million, amortizable intangible assets (customer lists) of $701 million with amortization periods of 7 years to 14 years, and non-amortizable intangible assets (trademarks) of $1,216 million. Goodwill associated with the acquisition is primarily attributable to the future revenue growth opportunities associated with sales growth in the skin care category, as well as the value associated with DECIEM's assembled workforce. As such, the goodwill has been allocated to the Company’s skin care product category. The goodwill recorded in connection with this acquisition is not deductible for tax purposes. The intangible assets acquired in connection with the acquisition of DECIEM is classified as level 3 in the fair value hierarchy. The estimate of the fair values of the acquired amortizable intangible assets were determined using a multi-period excess earnings income approach by discounting the incremental after-tax cash flows over multiple periods. Fair value was determined under this approach by estimating future cash flows over multiple periods, as well as a terminal value, and discounting such cash flows at a rate of return that reflects the relative risk of the cash flows. The estimate of the fair values of the acquired intangible assets not subject to amortization were determined using an income approach, specifically the relief-from-royalty method. This method assumes that, in lieu of ownership, a third party would be willing to pay a royalty in order to obtain the rights to use the comparable asset. F-25

string

Property, plant and equipment

4.4

SEC-NUM

The following summarizes the allocation of purchase price for the Itiviti acquisition (in millions): | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | Itiviti | | | | | Accounts receivable | $ | 38.9 | | | Other current assets | 14.2 | | | Property, plant and equipment | 4.4 | | | Intangible assets | 904.6 | | | Goodwill | 1,928.7 | | | Other non-current assets | 48.3 | | | Payables and accrued expenses | (72.0) | | | Current contract liabilities | (55.4) | | | Deferred taxes | (200.2) | | | | | | Other long term liabilities | (31.2) | | | Consideration paid, net of cash acquired | $ | 2,580.4 | | Unaudited Pro Forma Financial InformationThe unaudited pro forma condensed consolidated results of operations in the table below are provided for illustrative purposes only and summarize the combined results of operations of Broadridge and Itiviti. For purposes of this pro forma presentation, the acquisition of Itiviti is assumed to have occurred on July 1, 2019. The pro forma financial information for all periods presented also includes the estimated business combination accounting effects resulting from this acquisition, notably amortization expense from the acquired intangible assets, interest expense from recent debt financing, the proceeds of which were used to fund the acquisition, and certain other integration related impacts. This unaudited pro forma financial information should not be relied upon as being indicative of the historical results that would have been obtained if the acquisition had actually occurred on July 1, 2019, nor of the results of operations that may be obtained in the future. | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Years ended June 30, | | | | 2021 | | 2020 | | | | (in millions) | | Revenues | | $ | 5,221.7 | | | $ | 4,723.4 | | | Net earnings | | $ | 514.9 | | | $ | 367.5 | | | | | | | | | Basic earnings per share | | $ | 4.45 | | | $ | 3.21 | | | Diluted earnings per share | | $ | 4.37 | | | $ | 3.14 | | AdvisorStreamIn June 2021, the Company acquired AdvisorStream, a leading provider of digital engagement and marketing solutions for the global wealth and insurance industries. AdvisorStream's advisor marketing platform enables advisors to drive revenue and growth by providing personalized and consistent client communications. AdvisorStream is included in the Company’s GTO reportable segment.•The contingent consideration liability is payable through fiscal year 2024 upon the achievement by the acquired business of certain revenue targets, and has a maximum potential pay-out of $12.0 million upon the achievement in full of the defined financial targets by the acquired business.•The fair value of the contingent consideration liability at June 30, 2022 is $8.0 million. •Goodwill is not tax deductible. •Intangible assets acquired consist primarily of customer relationships and software technology, which are being amortized over a five-year life and five-year life, respectively.70

string

Cash collateral received

109

SEC-NUM

The effect on the Consolidated Statements of Operations of derivative instruments not designated as hedges is summarized as follows (in millions): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | GAINS (LOSSES) FOR THE YEARS ENDED | | Derivatives Not Designated as Hedging Instruments | | Line Item in Statements of Operations | | July 30, 2022 | | July 31, 2021 | | July 25, 2020 | | Foreign currency derivatives | | Other income (loss), net | | $ | (237) | | | $ | 2 | | | $ | (5) | | | Total return swaps—deferred compensation | | Operating expenses and other | | (92) | | | 157 | | | 15 | | | Equity derivatives | | Other income (loss), net | | 9 | | | 20 | | | 9 | | | Total | | | | $ | (320) | | | $ | 179 | | | $ | 19 | | The notional amounts of our outstanding derivatives are summarized as follows (in millions): | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | July 30, 2022 | | July 31, 2021 | | Foreign currency derivatives | $ | 4,521 | | | $ | 4,139 | | | Interest rate derivatives | 1,500 | | | 2,000 | | | Total return swaps—deferred compensation | 651 | | | 730 | | | Total | $ | 6,672 | | | $ | 6,869 | | (b)Offsetting of Derivative InstrumentsWe present our derivative instruments at gross fair values in the Consolidated Balance Sheets. However, our master netting and other similar arrangements with the respective counterparties allow for net settlement under certain conditions, which are designed to reduce credit risk by permitting net settlement with the same counterparty.To further limit credit risk, we also enter into collateral security arrangements related to certain derivative instruments whereby cash is posted as collateral between the counterparties based on the fair market value of the derivative instrument. Under these collateral security arrangements, the net cash collateral provided for was $14 million as of July 30, 2022 and the net cash collateral received was $109 million as of July 31, 2021. Including the effects of collateral, this results in a net derivative asset of $3 million and a net derivative liability of $3 million as of July 30, 2022 and July 31, 2021, respectively.(c)Foreign Currency Exchange RiskWe conduct business globally in numerous currencies. Therefore, we are exposed to adverse movements in foreign currency exchange rates. To limit the exposure related to foreign currency changes, we enter into foreign currency contracts. We do not enter into such contracts for speculative purposes.We hedge forecasted foreign currency transactions related to certain revenues, operating expenses and service cost of sales with currency options and forward contracts. These currency options and forward contracts, designated as cash flow hedges, generally have maturities of less than 24 months. The derivative instrument’s gain or loss is initially reported as a component of accumulated other comprehensive income (AOCI) and subsequently reclassified into earnings when the hedged exposure affects earnings.We enter into foreign exchange forward and option contracts to reduce the short-term effects of foreign currency fluctuations on assets and liabilities such as foreign currency receivables, long-term customer financings and payables. These derivatives are not designated as hedging instruments. Gains and losses on the contracts are included in other income (loss), net, and substantially offset foreign exchange gains and losses from the remeasurement of intercompany balances, other current assets, or liabilities denominated in currencies other than the functional currency of the reporting entity.We hedge certain net investments in our foreign operations with forward contracts to reduce the effects of foreign currency fluctuations on our net investment in those foreign subsidiaries. These derivative instruments generally have maturities of up to six months.88

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Proceeds from senior term loans

300,000

SEC-NUM

[Table of Contents](#i36695dc5143241f795c32e47bf5f4b3d_7)CBRE GROUP, INC.CONSOLIDATED STATEMENTS OF CASH FLOWS(Dollars in thousands) | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | Year Ended December 31, | | | 2021 | | 2020 | | 2019 | | CASH FLOWS FROM FINANCING ACTIVITIES: | | | | | | | Proceeds from senior term loans | — | | | — | | | 300,000 | | | Repayment of senior term loans | (300,000) | | | — | | | (300,000) | | | Proceeds from revolving credit facility | 26,599 | | | 835,671 | | | 3,609,000 | | | Repayment of revolving credit facility | — | | | (835,671) | | | (3,609,000) | | | Repayment of 5.25% senior notes (including premium) | — | | | (499,652) | | | — | | | Repayment of debt assumed in acquisition of Telford Homes | — | | | — | | | (110,687) | | | Sale of non-controlling interest - special purpose acquisition company | — | | | 393,661 | | | — | | | Redemption of non-controlling interest-special purpose acquisition company and payment of deferred underwriting commission | (205,110) | | | — | | | — | | | Proceeds from notes payable on real estate | 78,428 | | | 90,552 | | | 6,694 | | | Repayment of notes payable on real estate | (109,461) | | | (24,704) | | | — | | | Proceeds from issuance of 2.500% senior notes | 492,255 | | | — | | | — | | | Repurchase of common stock | (368,603) | | | (50,028) | | | (145,137) | | | Acquisition of businesses (cash paid for acquisitions more than three months after purchase date) | (17,769) | | | (44,700) | | | (42,147) | | | Units repurchased for payment of taxes on equity awards | (38,864) | | | (43,835) | | | (18,426) | | | Non-controlling interest contributions | 862 | | | 2,173 | | | 46,612 | | | Non-controlling interest distributions | (4,572) | | | (4,330) | | | (3,957) | | | Other financing activities, net | (44,396) | | | (41,893) | | | (4,901) | | | Net cash used in financing activities | (490,631) | | | (222,756) | | | (271,949) | | | Effect of currency exchange rate changes on cash and cash equivalents and restricted cash | (92,116) | | | 81,564 | | | (606) | | | NET INCREASE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | 500,534 | | | 945,502 | | | 229,801 | | | CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, AT BEGINNING OF YEAR | 2,039,247 | | | 1,093,745 | | | 863,944 | | | CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, AT END OF YEAR | $ | 2,539,781 | | | $ | 2,039,247 | | | $ | 1,093,745 | | | SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: | | | | | | | Cash paid during the year for: | | | | | | | Interest | $ | 41,068 | | | $ | 67,463 | | | $ | 86,666 | | | Income tax payments, net | $ | 330,426 | | | $ | 51,681 | | | $ | 365,065 | | | Non-cash investing and financing activities: | | | | | | | Deferred purchase consideration - Turner & Townsend | $ | 485,414 | | | $ | — | | | $ | — | | | Non-controlling interest as part of Turner & Townsend Acquisition | 774,122 | | | — | | | — | | | Investment in alignment shares and private placement warrants of Altus Power, Inc. | 141,871 | | | — | | | — | | | Reduction in redeemable non-controlling interest - special purpose acquisition company | 211,501 | | | — | | | — | | | Reduction of trust account - special purpose acquisition company | 189,801 | | | — | | | — | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | The accompanying notes are an integral part of these consolidated financial statements.62

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Recoveries of amounts previously written off

1

SEC-NUM

Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations. Residential mortgage backed securities, commercial mortgage backed securities and asset backed securities are not due at a single maturity date. As such, these securities were not included in the maturities distribution. 7. Financing Receivables Financing receivables are comprised of commercial loans, consumer loans, and deposit receivables. See Note 2 for information regarding the Company’s accounting policies related to financing receivables and the allowance for credit losses.Allowance for Credit Losses The following tables present a rollforward of the allowance for credit losses: | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | Commercial Loans | | Consumer Loans | | Total | | (in millions) | | | | | | | | | | | | | | | | Balance, January 1, 2021 | $ | 66 | | | $ | 2 | | | $ | 68 | | | Provisions | (13) | | | 2 | | | (11) | | | Charge-offs | (8) | | | (2) | | | (10) | | | Recoveries | — | | | 1 | | | 1 | | | Other | 2 | | | — | | | 2 | | | Balance, December 31, 2021 | $ | 47 | | | $ | 3 | | | $ | 50 | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | Commercial Loans | | Consumer Loans | | Total | | (in millions) | | Balance, December 31, 2019 (1) | $ | 51 | | | $ | — | | | $ | 51 | | | Cumulative effect of adoption of current expected credit losses guidance | 2 | | | 3 | | | 5 | | | Balance, January 1, 2020 | 53 | | | 3 | | | 56 | | | Provisions | 19 | | | 2 | | | 21 | | | Charge-offs | (6) | | | (3) | | | (9) | | | | | | | | | | Balance, December 31, 2020 | $ | 66 | | | $ | 2 | | | $ | 68 | | (1) Prior to January 1, 2020, the allowance for credit losses was based on an incurred loss model that did not require estimating expected credit losses over the expected life of the asset. | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | Commercial Loans | | | | | | (in millions) | | | | | | Balance at January 1, 2019 | $ | 49 | | | | | | | Provisions | 5 | | | | | | | Charge-offs | (4) | | | | | | | Recoveries of amounts previously written off | 1 | | | | | | | Balance at December 31, 2019 | $ | 51 | | | | | | The decrease in the allowance for credit losses provision for commercial loans reflects the sale of certain commercial mortgage loans and syndicated loans in conjunction with the fixed deferred and immediate annuity reinsurance transaction discussed in Note 1.Accrued interest on commercial loans was $13 million and $16 million as of December 31, 2021 and 2020, respectively, and is recorded in Receivables and excluded from the amortized cost basis of commercial loans.Purchases and SalesDuring the year ended December 31, 2021, the Company sold $746 million of commercial mortgage loans.During the years ended December 31, 2021, 2020 and 2019, the Company purchased $37 million, $173 million and $162 million, respectively, of syndicated loans, and sold $354 million, $17 million and $54 million, respectively, of syndicated loans. During the years ended December 31, 2021 and 2020, the Company purchased $33 million and $22 million, respectively, of residential mortgage loans, and sold $1 million and nil, respectively, of residential mortgage loans. The allowance for credit losses for residential mortgage loans was not material as of both December 31, 2021 and 2020.The Company has not acquired any loans with deteriorated credit quality as of the acquisition date. 101

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Debt instrument, face amount

1,250

SEC-NUM

EOG RESOURCES, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (Unaudited) 9. Pension and Postretirement Benefits Pension Plans. EOG has a defined contribution pension plan in place for most of its employees in the United States. EOG's contributions to the pension plan are based on various percentages of compensation and, in some instances, are based upon the amount of the employees' contributions. EOG's total costs recognized for the pension plan were $37 million and $36 million for the nine months ended September 30, 2022 and 2021. In addition, EOG's Trinidadian subsidiary maintains a contributory defined benefit pension plan and a matched savings plan, both of which are available to most of the employees of the Trinidadian subsidiary, the costs of which are not material. Postretirement Health Care. EOG has postretirement medical and dental benefits in place for eligible United States and Trinidad employees and their eligible dependents, the costs of which are not material. 10. Long-Term Debt and Common Stock Long-Term Debt. EOG had no outstanding commercial paper borrowings at September 30, 2022 and December 31, 2021, and did not utilize any commercial paper borrowings during the nine months ended September 30, 2022 and 2021. At September 30, 2022, the $1,250 million aggregate principal amount of EOG's 2.625% Senior Notes due 2023 were classified as Current Portion of Long-Term Debt on the Condensed Consolidated Balance Sheets. EOG currently has a $2.0 billion senior unsecured Revolving Credit Agreement (Agreement) with domestic and foreign lenders (Banks). The Agreement has a scheduled maturity date of June 27, 2024, and includes an option for EOG to extend, on up to two occasions, the term for successive one-year periods subject to certain terms and conditions. The Agreement (i) commits the Banks to provide advances up to an aggregate principal amount of $2.0 billion at any one time outstanding, with an option for EOG to request increases in the aggregate commitments to an amount not to exceed $3.0 billion, subject to certain terms and conditions and (ii) includes a swingline subfacility and a letter of credit subfacility. Advances under the Agreement will accrue interest based, at EOG's option, on either LIBOR plus an applicable margin (Eurodollar rate) or the base rate (as defined in the Agreement) plus an applicable margin. The Agreement contains representations, warranties, covenants and events of default that EOG believes are customary for investment-grade, senior unsecured commercial bank credit agreements, including a financial covenant for the maintenance of a ratio of total debt-to-capitalization (as such terms are defined in the Agreement) of no greater than 65%. At September 30, 2022, EOG was in compliance with this financial covenant. At September 30, 2022 and December 31, 2021, there were no borrowings or letters of credit outstanding under the Agreement. The Eurodollar rate and base rate (inclusive of the applicable margin), had there been any amounts borrowed under the Agreement at September 30, 2022, would have been 4.04% and 6.25%, respectively. Common Stock. On February 24, 2022, the Board declared a quarterly cash dividend on the common stock of $0.75 per share paid on April 29, 2022, to stockholders of record as of April 15, 2022. The Board also declared on such date a special dividend of $1.00 per share paid on March 29, 2022, to stockholders of record as of March 15, 2022. On May 5, 2022, the Board declared a quarterly cash dividend on the common stock of $0.75 per share paid on July 29, 2022, to stockholders of record as of July 15, 2022. The Board also declared on such date a special dividend of $1.80 per share paid on June 30, 2022, to stockholders of record as of June 15, 2022. On August 4, 2022, the Board declared a special dividend on the common stock of $1.50 per share paid on September 29, 2022, to stockholders of record as of September 15, 2022. On September 29, 2022, the Board declared a quarterly cash dividend on the common stock of $0.75 per share payable on October 31, 2022, to stockholders of record as of October 17, 2022. At September 30, 2022, this quarterly cash dividend was accrued as Dividends Payable on the Condensed Consolidated Balance Sheets. On November 3, 2022, the Board (i) increased the quarterly cash dividend on the common stock from the previous $0.75 per share to $0.825 per share, effective beginning with the dividend payable on January 31, 2023, to stockholders of record as of January 17, 2023, and (ii) declared a special cash dividend on the common stock of $1.50 per share, payable on December 30, 2022, to stockholders of record as of December 15, 2022. -16-

string

Amount of natural gas to be purchased under futures contracts (in MMBtu)

8.9

SEC-NUM

Derivative Contracts at Fair Value with Offsetting Regulatory AmountsCommodity Supply and Price Risk Management: As required by regulation, CL&P, along with UI, has capacity-related contracts with generation facilities. CL&P has a sharing agreement with UI, with 80 percent of the costs or benefits of each contract borne by or allocated to CL&P and 20 percent borne by or allocated to UI. The combined capacities of these contracts as of both December 31, 2021 and 2020 were 675 MW. The capacity contracts extend through 2026 and obligate both CL&P and UI to make or receive payments on a monthly basis to or from the generation facilities based on the difference between a set capacity price and the capacity market price received in the ISO-NE capacity markets. As of December 31, 2020, Eversource had New York Mercantile Exchange (NYMEX) financial contracts for natural gas futures in order to reduce variability associated with the price of 8.9 million MMBtu of natural gas. These contracts were classified as Level 2 in the fair value hierarchy. NSTAR Gas terminated its financial contracts swap program in April 2021. For the years ended December 31, 2021, 2020 and 2019, there were losses of $7.1 million, $21.2 million and $20.7 million, respectively, deferred as regulatory costs, which reflect the change in fair value associated with Eversource's derivative contracts. Fair Value Measurements of Derivative InstrumentsThe fair value of derivative contracts classified as Level 3 utilizes significant unobservable inputs. The fair value is modeled using income techniques, such as discounted cash flow valuations adjusted for assumptions related to exit price. Significant observable inputs for valuations of these contracts include energy-related product prices in future years for which quoted prices in an active market exist. Fair value measurements categorized in Level 3 of the fair value hierarchy are prepared by individuals with expertise in valuation techniques, pricing of energy-related products, and accounting requirements. The future capacity prices for periods that are not quoted in an active market or established at auction are based on available market data and are escalated based on estimates of inflation in order to address the full term of the contract. Valuations of derivative contracts using a discounted cash flow methodology include assumptions regarding the timing and likelihood of scheduled payments and also reflect non-performance risk, including credit, using the default probability approach based on the counterparty's credit rating for assets and the Company's credit rating for liabilities. Valuations incorporate estimates of premiums or discounts that would be required by a market participant to arrive at an exit price, using historical market transactions adjusted for the terms of the contract. The following is a summary of Level 3 derivative contracts and the range of the significant unobservable inputs utilized in the valuations over the duration of the contracts: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | As of December 31, | | | 2021 | | 2020 | | CL&P | Range | | Weighted Average (1) | | | | Period Covered | | Range | | Weighted Average (1) | | | | Period Covered | | Capacity Prices | $2.61 | | $ | 2.61 | | | per kW-Month | | 2025 - 2026 | | $ | 4.30 | | | — | | $5.30 | | $ | 4.63 | | | per kW-Month | | 2024 - 2026 | | | | | | | | | | | | | | | | | | | | | | | | | | | Forward Reserve | $ | 0.50 | | | — | | $1.15 | | $ | 0.82 | | | per kW-Month | | 2022 - 2024 | | $ | 0.54 | | | — | | $0.90 | | $ | 0.72 | | | per kW-Month | | 2021 - 2024 | (1) Unobservable inputs were weighted by the relative future capacity and forward reserve prices and contractual MWs over the periods covered. Exit price premiums of 5.0 percent through 9.3 percent, or a weighted average of 8.2 percent, are also applied to these contracts and reflect the uncertainty and illiquidity premiums that would be required based on the most recent market activity available for similar type contracts. The risk premium was weighted by the relative fair value of the net derivative instruments. Significant increases or decreases in future capacity or forward reserve prices in isolation would decrease or increase, respectively, the fair value of the derivative liability. Any increases in risk premiums would increase the fair value of the derivative liability. Changes in these fair values are recorded as a regulatory asset or liability and do not impact net income. The following table presents changes in the Level 3 category of derivative assets and derivative liabilities measured at fair value on a recurring basis. The derivative assets and liabilities are presented on a net basis. | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | CL&P(Millions of Dollars) | For the Years Ended December 31, | | 2021 | | 2020 | | Derivatives, Net: | | | | | Fair Value as of Beginning of Period | $ | (293.1) | | | $ | (329.2) | | | Net Realized/Unrealized Losses Included in Regulatory Assets | (8.5) | | | (17.9) | | | Settlements | 52.4 | | | 54.0 | | | Fair Value as of End of Period | $ | (249.2) | | | $ | (293.1) | | 101

string

Initial term

5

SEC-NUM

THE CHARLES SCHWAB CORPORATIONNotes to Consolidated Financial Statements(Tabular Amounts in Millions, Except Per Share Data, Option Price Amounts, Ratios, or as Noted) The following table summarizes the purchase price, fair values of the assets acquired and liabilities assumed, and resulting goodwill as of the May 26, 2020 acquisition date, adjusted for the post-closing adjustments described above. | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | Purchase price | $ | 1,581 | | | Fair value of assets acquired: | | | Cash segregated and on deposit for regulatory purposes | 4,392 | | | Receivables from brokerage clients | 80 | | | Acquired intangible assets | 1,109 | | | Total assets acquired | 5,581 | | | Fair value of liabilities assumed: | | | Payables to brokerage clients | 4,472 | | | Total liabilities assumed | 4,472 | | | Fair value of net identifiable assets acquired | $ | 1,109 | | | Goodwill | $ | 472 | | The identifiable intangible assets of $1.1 billion are subject to amortization. The following table summarizes the major classes of intangible assets acquired and their respective fair values and weighted-average useful lives: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | Fair Value | | Weighted-Average Useful Life (Years) | | Customer relationships | $ | 962 | | | 18 | | Brokerage referral agreement (1) | 142 | | | 20 | | Royalty-free license | 5 | | | 7 | | Total acquired intangible assets | $ | 1,109 | | | | (1) The brokerage referral agreement has an initial term of 5 years and is automatically renewable for one-year increments thereafter. Goodwill recorded of $472 million, primarily attributable to the additional scale and anticipated synergies from the USAA-IMCO acquisition, was assigned to the Investor Services segment and is deductible for tax purposes. The Company’s consolidated statements of income include total net revenues and net loss attributable to the USAA-IMCO acquisition of $235 million and $51 million, respectively, for the period May 26, 2020 through December 31, 2020. In connection with the acquisition, the Company agreed to reimburse USAA for certain contract termination and other fees and severance costs incurred by USAA. These costs totaled $21 million for the year ended December 31, 2020 and are included in other expense on the consolidated statements of income. Additionally, the Company incurred various professional fees and other costs related to the USAA-IMCO acquisition, such as advisory, legal, and accounting fees. In total, the Company incurred acquisition costs of $54 million and $14 million for the years ended December 31, 2020 and 2019, respectively, which are primarily included in professional services, other expense, and compensation and benefits on the consolidated statements of income. Pro Forma Financial Information (Unaudited) The following table presents unaudited pro forma financial information as if the TD Ameritrade and USAA-IMCO acquisitions had occurred on January 1, 2019. The unaudited pro forma results reflect after-tax adjustments for acquisition costs, amortization and depreciation of acquired intangible and tangible assets, the impact of the amended IDA agreement which reduced the service fee on client cash deposits held at the TD Depository Institutions to 15 basis points from the 25 basis points paid by TD Ameritrade under its previous IDA agreement, and other immaterial adjustments for the effects of purchase accounting, and do not reflect potential revenue growth or cost savings that may be realized as a result of the acquisitions. Pro forma net income for the year ended December 31, 2020 excludes after-tax acquisition costs for both Schwab and the acquirees of $156 million. These costs and after-tax acquisition costs of $40 million incurred in 2019 by Schwab and the acquirees are included in pro forma net income for the year ended December 31, 2019. - 78 -

string

Less: Reinsurance, including disposal groups

46

SEC-NUM

Activity in the unpaid claims and claim expenses for the divested international businesses and our interest in a joint venture in Türkiye is presented in the following table. Liabilities associated with Other Operations are excluded because they pertain to obligations for long-duration insurance contracts or, if short-duration, the liabilities have been largely reinsured. | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | Nine Months Ended | | | | (In millions) | September 30, 2022 (1) | | September 30, 2021 | | | | | | | | | | | Beginning balance | $ | 447 | | | $ | 452 | | | | | Less: Reinsurance | 46 | | | 45 | | | | | Beginning balance, net | 401 | | | 407 | | | | | Incurred claims related to: | | | | | | | Current year | 497 | | | 746 | | | | | Prior years | 4 | | | (1) | | | | | | | | | | | | | | | | | | | Total incurred | 501 | | | 745 | | | | | Paid claims related to: | | | | | | | Current year | 313 | | | 526 | | | | | Prior years | 187 | | | 211 | | | | | Total paid | 500 | | | 737 | | | | | | | | | | | | | | | | | | | Foreign currency | (28) | | | (31) | | | | | Divestiture of international businesses | (369) | | | — | | | | | Ending balance, net | 5 | | | 384 | | | | | Add: Reinsurance | 1 | | | 46 | | | | | Ending balance | $ | 6 | | | $ | 430 | | | | (1) Beginning balance includes unpaid claims amounts classified as Liabilities of businesses held for sale. Reinsurance in the table above reflects amounts due from reinsurers related to unpaid claims liabilities. See Note 10 for additional information on reinsurance.21

string

Cash paid for acquisition of business, net of cash acquired

576

SEC-NUM

Ameriprise Financial, Inc.Consolidated Statements of Cash Flows | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | Years Ended December 31, | | 2021 | | 2020 | | 2019 | | (in millions) | | Cash Flows from Operating Activities | | | | | | | Net income | $ | 2,760 | | | $ | 1,534 | | | $ | 1,893 | | | Adjustments to reconcile net income to net cash provided by operating activities: | | | | | | | Depreciation, amortization and accretion, net | 98 | | | 207 | | | 183 | | | Deferred income tax expense (benefit) | (87) | | | (321) | | | (308) | | | Share-based compensation | 152 | | | 146 | | | 135 | | | Gain on disposal of business before affinity partner payment | — | | | — | | | (313) | | | Net realized investment (gains) losses | (632) | | | (22) | | | (16) | | | Net trading (gains) losses | 5 | | | (10) | | | (10) | | | Loss from equity method investments | 75 | | | 66 | | | 95 | | | Impairments and provision for loan and credit losses | 4 | | | 24 | | | 22 | | | Net (gains) losses of consolidated investment entities | (20) | | | 7 | | | 9 | | | Changes in operating assets and liabilities, net of effects from acquisitions: | | | | | | | Restricted and segregated investments | 25 | | | (500) | | | 124 | | | Deferred acquisition costs | (156) | | | 49 | | | (112) | | | Policyholder account balances, future policy benefits and claims, net | 2,086 | | | 3,054 | | | 358 | | | Derivatives, net of collateral | (570) | | | (141) | | | 415 | | | Receivables | (520) | | | (648) | | | 324 | | | Brokerage deposits | 26 | | | 346 | | | (519) | | | Accounts payable and accrued expenses | 300 | | | 129 | | | 46 | | | Current income tax, net | (308) | | | 25 | | | 32 | | | Deferred taxes, net | 4 | | | 334 | | | (18) | | | Other operating assets and liabilities of consolidated investment entities, net | 20 | | | (15) | | | (12) | | | Other, net | 63 | | | 359 | | | 13 | | | Net cash provided by (used in) operating activities | 3,325 | | | 4,623 | | | 2,341 | | | | | | | | | | Cash Flows from Investing Activities | | | | | | | Available-for-Sale securities: | | | | | | | Proceeds from sales | 556 | | | 1,708 | | | 242 | | | Maturities, sinking fund payments and calls | 11,501 | | | 9,554 | | | 8,202 | | | Purchases | (14,718) | | | (13,525) | | | (11,911) | | | Proceeds from sales, maturities and repayments of mortgage loans | 299 | | | 217 | | | 272 | | | Funding of mortgage loans | (263) | | | (165) | | | (354) | | | Proceeds from sales, maturities and collections of other investments | 173 | | | 198 | | | 276 | | | Purchase of other investments | (97) | | | (284) | | | (288) | | | Purchase of investments by consolidated investment entities | (1,603) | | | (957) | | | (644) | | | Proceeds from sales, maturities and repayments of investments by consolidated investment entities | 1,047 | | | 606 | | | 684 | | | Purchase of land, buildings, equipment and software | (120) | | | (147) | | | (143) | | | Proceeds from disposal of business, net of cash and cash equivalents sold | — | | | — | | | 934 | | | Cash paid for written options with deferred premiums | (552) | | | (338) | | | (308) | | | Cash received from written options with deferred premiums | 106 | | | 133 | | | 170 | | | Cash paid for acquisition of business, net of cash acquired | (576) | | | — | | | — | | | Cash paid for deposit receivables | (377) | | | (4) | | | (349) | | | Cash received for deposit receivables | 254 | | | 93 | | | 98 | | | Other, net | (10) | | | 17 | | | (115) | | | Net cash provided by (used in) investing activities | $ | (4,380) | | | $ | (2,894) | | | $ | (3,234) | | | See Notes to Consolidated Financial Statements. | 74

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Notes classified as equity

102.2

SEC-NUM

[Table of Conten](#i207805ce14724a60909000a6c8cb9e11_7)[t](#i207805ce14724a60909000a6c8cb9e11_7)[s](#i207805ce14724a60909000a6c8cb9e11_7)Credit Facilities Delayed-Draw Term LoanOn December 16, 2021, we entered into a term loan credit agreement, which provides for a 364-day delayed-draw term loan facility up to an aggregate principal amount of $1.0 billion. Borrowings under the Delayed-Draw Term Loan facility may be Base Rate Loans, Daily Floating London Interbank Offered Rate (“LIBOR”) Loans or Eurodollar Rate Loans and bear interest as follows: (1) Eurodollar Rate Loans bear interest at a variable rate equal to the London inter-bank offered rate plus a margin of between 60.0 and 80.0 basis points, depending on the Company’s long-term debt credit rating; (2) Daily Floating LIBOR Rate Loans, like Eurodollar Rate Loans, bear interest at a variable rate equal to the London inter-bank offered rate plus a margin of between 60.0 and 80.0 basis points, depending on the Company’s long-term debt credit rating; and (3) Base Rate Loans bear interest at a variable rate equal to the highest of (a) the Federal funds rate (as published by the Federal Reserve Bank of New York from time to time) plus 1/2 of 1%, (b) Bank of America’s prime rate as publicly announced from time to time and (c) the Eurodollar Rate (as defined in the Credit Agreement) plus 1%; provided that in no event will the Eurodollar Rate be less than 0.0%.We immediately drew down the full $1.0 billion available under the facility as a daily floating LIBOR rate loan (“Delayed-Draw Term Loan”) with repayment of the principal due December 15, 2022. The Delayed-Draw Term Loan bears interest at a variable rate equal to the daily LIBOR rate plus a spread of 60 basis points, based on Fortive’s current credit rating. Borrowings under the Delayed-Draw Term Loan facility are prepayable at the Company’s option in whole or in part without premium or penalty and amounts borrowed may not be reborrowed once repaid.Debt-for-Equity ExchangeOn January 19, 2021, we completed the Debt-for-Equity Exchange of 33.5 million shares of common stock of Vontier, representing all of the Retained Vontier Shares, for $1.1 billion in aggregate principal amount of indebtedness of the Company held by Goldman Sachs & Co., including (i) all $400.0 million of the Term Loan due March 2021 and (ii) $683.2 million of the Term Loan due May 2021. We recorded a loss on extinguishment of the debt included in the Debt-for-Equity Exchange of $94.4 million in the year ended December 31, 2021. Term Loan due May 2021On January 21, 2021, we repaid the remaining $316.8 million outstanding of the Term Loan due May 2021 from the cash proceeds received from Vontier in the Vontier Separation. The fees associated with the prepayment were immaterial. Our credit facility agreements require, among others, that we maintain certain financial covenants and we were in compliance with all of our financial covenants on December 31, 2021.Convertible Senior NotesOn February 22, 2019, we issued $1.4 billion in aggregate principal amount of our 0.875% Convertible Senior Notes due 2022 (the “Convertible Notes”), including $187.5 million in aggregate principal amount resulting from an exercise in full of an over-allotment option. The Convertible Notes were issued in a private placement to certain initial purchasers for resale to qualified institutional buyers pursuant to Rule 144A under the Securities Act. The Convertible Notes bear interest at a rate of 0.875% per year, payable semiannually in arrears on February 15 and August 15 of each year, beginning on August 15, 2019. Of the $1.4 billion in principal amount from the issuance of the Convertible Notes, $1.3 billion was classified as debt and $102.2 million was classified as equity, using an assumed effective interest rate of 3.38%. Debt issuance costs of $24.3 million were proportionately allocated to debt and equity.On February 9, 2021, we repurchased $281 million of the Convertible Notes using the remaining cash proceeds received from Vontier in the Separation and other cash on hand. In connection with the repurchase, we recorded a loss on debt extinguishment during 2021 of $10.5 million. In addition, upon repurchase we recorded $11.6 million as a reduction to additional paid-in capital related to the equity component of the repurchased Convertible Notes. We recognized $45 million in interest expense during the year ended December 31, 2021, of which $10 million related to the contractual coupon rate of 0.875%, $6 million was attributable to the amortization of debt issuance costs, and $29 million was attributable to the amortization of the discount. Additionally, we recognized $0.3 million interest expense related to the Delayed- Draw Term Loan. We recognized $54 million in interest expense during the year ended December 31, 2020, of which $13 million related to the contractual coupon rate of 0.875%, $8 million was attributable to the amortization of debt issuance costs, and $34 million was attributable to the amortization of the discount. The discount at issuance was $102 million and is being amortized over a three-year period. The unamortized discount at December 31, 2021 was $4 million.77

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Assets held for sale

4,337

SEC-NUM

CAESARS ENTERTAINMENT, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)continue to leverage the World Series of Poker (“WSOP”) brand, and license the WSOP trademarks for a variety of products and services. Extensive usage of digital platforms, continued legalization in additional states, and growing bettor demand are driving the market for online sports betting platforms in the U.S. and the William Hill Acquisition positioned us to address this growing market. On September 8, 2021, the Company entered into an agreement to sell William Hill International to 888 Holdings Plc for approximately £2.2 billion. The sale is subject to satisfaction of customary conditions, including receipt of the approval of shareholders and regulatory approvals, and is expected to close in the second quarter of 2022. The Company previously held an equity interest in William Hill PLC and William Hill US (see Note 5). Accordingly, the acquisition is accounted for as a business combination achieved in stages, or a “step acquisition.”The estimated purchase consideration in the acquisition was determined with reference to its acquisition date fair value. | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | (In millions) | Consideration | | Cash for outstanding William Hill common stock | $ | 3,909 | | | Fair value of William Hill equity awards | 30 | | | Settlement of preexisting relationships (net of receivable/payable) | 7 | | | Settlement of preexisting relationships (net of previously held equity investment and off-market settlement) | (34) | | | Total purchase consideration | $ | 3,912 | | Preliminary Purchase Price AllocationThe purchase price allocation for William Hill is preliminary as it relates to determining the fair value of certain assets and liabilities, including goodwill, and is subject to change. The fair values are based on management’s analysis including preliminary work performed by third-party valuation specialists, which are subject to finalization over the one-year measurement period. The following table summarizes the preliminary allocation of the purchase consideration to the identifiable assets acquired and liabilities assumed of William Hill, with the excess recorded as goodwill as of December 31, 2021: | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | (In millions) | Fair Value | | Other current assets | $ | 164 | | | Assets held for sale | 4,337 | | | Property and equipment, net | 55 | | | Goodwill | 1,148 | | | Intangible assets (a) | 565 | | | Other noncurrent assets | 317 | | | Total assets | $ | 6,586 | | | | | | Other current liabilities | $ | 242 | | | Liabilities related to assets held for sale (b) | 2,142 | | | Deferred income taxes | 245 | | | Other noncurrent liabilities | 35 | | | Total liabilities | 2,664 | | | Noncontrolling interests | 10 | | | Net assets acquired | $ | 3,912 | | \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(a)Intangible assets consist of gaming rights valued at $80 million, trademarks valued at $27 million, developed technology valued at $110 million, reacquired rights valued at $280 million and customer relationships valued at $68 million.(b)Includes debt of $1.1 billion related to William Hill International at the acquisition date.The preliminary purchase price allocation is subject to a measurement period and has since been revised. Assets and liabilities held for sale noted above are substantially all related to William Hill International and during the fourth quarter ended December 31, 2021, management has revised the estimated fair value of the William Hill International operations which has resulted in changes in net assets and the allocation of goodwill. The net impact of these changes was an increase of $4 million to other current assets, a $38 million decrease to assets held for sale, a $46 million increase to goodwill, a $10 million increase to other noncurrent assets, a $7 million decrease to other current liabilities, a $12 million increase to liabilities related to assets held for sale, and a $17 million increase to deferred income taxes. The effect of these revisions during the quarter did not have an impact on our Statements of Operations.[Table of Contents](#i37dfc5eabc12461dbfc5ef573d80947e_7)74

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Business Acquisition, VMware's Termination Fee - Specified Circumstances

1.5

SEC-NUM

[Table of Contents](#i02bedaa3ef9a402693e3fc0f0d740b61_7)Effective upon the effective time of the VMware Merger, one member of the VMware Board of Directors, to be mutually agreed by us and VMware, will be added to our Board of Directors.In connection with the execution of the VMware Merger Agreement, we entered into a commitment letter on May 26, 2022, with certain financial institutions that committed to provide, subject to the terms and conditions of the commitment letter, a senior unsecured bridge facility in an aggregate principal amount of $32 billion.The VMware Merger, which is expected to be completed in our fiscal year ending October 29, 2023, is subject to satisfaction or waiver of customary closing conditions, including (i) adoption of the VMware Merger Agreement by VMware stockholders, (ii) the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvement Act of 1976 and clearance under the antitrust laws of the European Union and certain other jurisdictions, and (iii) the effectiveness of the registration statement on Form S-4 that we filed on July 15, 2022, as may be amended from time to time, registering approximately 59 million shares of our common stock. We and VMware each have termination rights under the VMware Merger Agreement and, under specified circumstances, upon termination of the agreement, we and VMware would be required to pay the other a termination fee of $1.5 billion.4. Supplemental Financial InformationCash EquivalentsCash equivalents included $2,576 million and $4,668 million of time deposits and $1,747 million and $1,607 million of money-market funds as of July 31, 2022 and October 31, 2021, respectively. For time deposits, carrying value approximates fair value due to the short-term nature of the instruments. The fair value of money-market funds, which was consistent with their carrying value, was determined using unadjusted prices in active, accessible markets for identical assets, and as such, they were classified as Level 1 assets in the fair value hierarchy.Accounts Receivable FactoringWe sell certain of our trade accounts receivable on a non-recourse basis to third-party financial institutions pursuant to factoring arrangements. We account for these transactions as sales of receivables and present cash proceeds as cash provided by operating activities in the condensed consolidated statements of cash flows. Total trade accounts receivable sold under the factoring arrangements were $900 million and $3,000 million during the fiscal quarter and three fiscal quarters ended July 31, 2022, respectively, and $1,000 million and $2,827 million during the fiscal quarter and three fiscal quarters ended August 1, 2021, respectively. Factoring fees for the sales of receivables were recorded in other income (expense), net and were not material for any of the periods presented.Inventory | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | July 31,2022 | | October 31,2021 | | | | | | | | | | (In millions) | | Finished goods | | $ | 641 | | | $ | 423 | | | Work-in-process | | 994 | | | 680 | | | Raw materials | | 203 | | | 194 | | | Total inventory | | $ | 1,838 | | | $ | 1,297 | | Other Current Assets | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | July 31,2022 | | October 31,2021 | | | | | | | | | | (In millions) | | Prepaid expenses | | $ | 728 | | | $ | 539 | | | Other | | 310 | | | 516 | | | Total other current assets | | $ | 1,038 | | | $ | 1,055 | | 11

string

2026

148

SEC-NUM

[Table of Contents](#i2ba0bd92bcb14d27a1d59d9667569d45_7)THE ESTÉE LAUDER COMPANIES INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTSOther Intangible Assets Other intangible assets include trademarks and patents, as well as license agreements and other intangible assets resulting from or related to businesses and assets purchased by the Company. Indefinite-lived intangible assets (e.g., trademarks) are not subject to amortization and are assessed at least annually for impairment during the fiscal fourth quarter or more frequently if certain events or circumstances exist. Other intangible assets (e.g., customer lists) are amortized on a straight-line basis over their expected period of benefit, approximately 7 years to 20 years. Intangible assets related to license agreements were amortized on a straight-line basis over their useful lives based on the terms of the respective agreements. The costs incurred and expensed by the Company to extend or renew the term of acquired intangible assets during fiscal 2022 and 2021 were not significant to the Company’s results of operations.Other intangible assets consist of the following: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | June 30, 2022 | | June 30, 2021 | | (In millions) | | GrossCarryingValue | | AccumulatedAmortization | | Total NetBook Value | | GrossCarryingValue | | AccumulatedAmortization | | Total NetBook Value | | Amortizable intangible assets: | | | | | | | | | | | | | | Customer lists and other | | $ | 2,061 | | | $ | 625 | | | $ | 1,436 | | | $ | 2,273 | | | $ | 544 | | | $ | 1,729 | | | License agreements | | 3 | | | 3 | | | — | | | 43 | | | 43 | | | — | | | | | $ | 2,064 | | | $ | 628 | | | 1,436 | | | $ | 2,316 | | | $ | 587 | | | 1,729 | | | Non-amortizable intangible assets: | | | | | | | | | | | | | | Trademarks and other | | | | | | 1,992 | | | | | | | 2,366 | | | Total intangible assets | | | | | | $ | 3,428 | | | | | | | $ | 4,095 | | The aggregate amortization expense related to amortizable intangible assets for fiscal 2022, 2021 and 2020 was $160 million, $110 million and $73 million, respectively. The estimated aggregate amortization expense for each of the next five fiscal years is as follows: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Fiscal | | (In millions) | | 2023 | | 2024 | | 2025 | | 2026 | | 2027 | | Estimated aggregate amortization expense | | $ | 149 | | | $ | 148 | | | $ | 148 | | | $ | 148 | | | $ | 131 | | F-27

string

Weighted-average remaining life

3.3

SEC-NUM

[Table of Contents](#iafeb83384c73449bb49e90c3c5b8201e_7) | | | | | --- | --- | --- | | | | | | Fifth Third Bancorp and SubsidiariesNotes to Condensed Consolidated Financial Statements (unaudited) | commodity contracts to hedge such items as natural gas and various other derivative contracts. The Bancorp may economically hedge significant exposures related to these derivative contracts entered into for the benefit of customers by entering into offsetting contracts with approved, reputable, independent counterparties with substantially matching terms. The Bancorp hedges its interest rate exposure on commercial customer transactions by executing offsetting swap agreements with primary dealers. Revaluation gains and losses on interest rate, foreign exchange, commodity and other commercial customer derivative contracts are recorded as a component of commercial banking revenue or other noninterest income in the Condensed Consolidated Statements of Income. The Bancorp enters into risk participation agreements, under which the Bancorp assumes credit exposure relating to certain underlying interest rate derivative contracts. The Bancorp only enters into these risk participation agreements in instances in which the Bancorp has participated in the loan that the underlying interest rate derivative contract was designed to hedge. The Bancorp will make payments under these agreements if a customer defaults on its obligation to perform under the terms of the underlying interest rate derivative contract. The total notional amount of the risk participation agreements was $3.7 billion and $3.8 billion at June 30, 2022 and December 31, 2021, respectively, and the fair value was a liability of $8 million at both June 30, 2022 and December 31, 2021 which is included in other liabilities in the Condensed Consolidated Balance Sheets. As of June 30, 2022, the risk participation agreements had a weighted-average remaining life of 3.3 years. The Bancorp’s maximum exposure in the risk participation agreements is contingent on the fair value of the underlying interest rate derivative contracts in an asset position at the time of default. The Bancorp monitors the credit risk associated with the underlying customers in the risk participation agreements through the same risk grading system currently utilized for establishing loss reserves in its loan and lease portfolio. Risk ratings of the notional amount of risk participation agreements under this risk rating system are summarized in the following table as of: | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | ($ in millions) | June 30,2022 | December 31,2021 | | Pass | $ | 3,687 | | 3,733 | | | Special mention | — | | 13 | | | Substandard | 34 | | 34 | | | Total | $ | 3,721 | | 3,780 | | The net gains (losses) recorded in the Condensed Consolidated Statements of Income relating to free-standing derivative instruments used for customer accommodation are summarized in the following table: | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | Condensed ConsolidatedStatements of Income Caption | For the three months endedJune 30, | | For the six months endedJune 30, | | ($ in millions) | 2022 | 2021 | | 2022 | 2021 | | Interest rate contracts: | | | | | | | | Interest rate contracts for customers (contract revenue) | Commercial banking revenue | $ | 10 | | 12 | | | 26 | | 19 | | | | | | | | | | | Interest rate contracts for customers (credit portion of fair value adjustment) | Other noninterest expense | 3 | | 1 | | | 9 | | 16 | | | Interest rate lock commitments | Mortgage banking net revenue | 11 | | 57 | | | 11 | | 89 | | | Commodity contracts: | | | | | | | | Commodity contracts for customers (contract revenue) | Commercial banking revenue | 9 | | 6 | | | 18 | | 11 | | | Commodity contracts for customers (credit portion of fair value adjustment) | Other noninterest expense | (1) | | (1) | | | (2) | | — | | | | | | | | | | | Foreign exchange contracts: | | | | | | | | Foreign exchange contracts for customers (contract revenue) | Commercial banking revenue | 20 | | 16 | | | 36 | | 30 | | | Foreign exchange contracts for customers (contract revenue) | Other noninterest income | 8 | | (2) | | | 10 | | (1) | | | Foreign exchange contracts for customers (credit portion of fair value adjustment) | Other noninterest expense | (2) | | — | | | (2) | | — | | Offsetting Derivative Financial InstrumentsThe Bancorp’s derivative transactions are generally governed by ISDA Master Agreements and similar arrangements, which include provisions governing the setoff of assets and liabilities between the parties. When the Bancorp has more than one outstanding derivative transaction with a single counterparty, the setoff provisions contained within these agreements generally allow the non-defaulting party the right to reduce its liability to the defaulting party by amounts eligible for setoff, including the collateral received as well as eligible offsetting 104

string

Stock Repurchase Program, Remaining Authorized Repurchase Amount

13

SEC-NUM

[Table of Contents](#i5ec3aabfaa534f9c8fa2d2a5b7677d19_7) Weighted Average SharesThe following table illustrates net income per share attributable to ordinary shareholders and the weighted average shares outstanding used in calculating basic and diluted income per share: | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Year Ended December 31, | | | | | | | | 2021 | | 2020 | | 2019 | | | | | | | | (in millions, except per share data) | | Numerator, basic: | | | | | | | | | | | | Net income attributable to ordinary shareholders | | | | | | $ | 527 | | | $ | 1,769 | | | $ | 990 | | | Numerator, diluted: | | | | | | | | | | | | Net income attributable to Aptiv | | | | | | $ | 590 | | | $ | 1,804 | | | $ | 990 | | | | | | | | | | | | | | | | | | | | | | | | | | | MCPS dividends (1) | | | | | | (63) | | | — | | | — | | | Numerator, diluted | | | | | | $ | 527 | | | $ | 1,804 | | | $ | 990 | | | Denominator: | | | | | | | | | | | | Weighted average ordinary shares outstanding, basic | | | | | | 270.46 | | | 263.43 | | | 256.81 | | | Dilutive shares related to RSUs | | | | | | 0.76 | | | 0.44 | | | 0.58 | | | Weighted average MCPS converted shares (1) | | | | | | — | | | 6.83 | | | — | | | Weighted average ordinary shares outstanding, including dilutive shares | | | | | | 271.22 | | | 270.70 | | | 257.39 | | | | | | | | | | | | | | | Net income per share attributable to ordinary shareholders: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Basic | | | | | | $ | 1.95 | | | $ | 6.72 | | | $ | 3.85 | | | | | | | | | | | | | | | | | | | | | | | | | | | Diluted | | | | | | $ | 1.94 | | | $ | 6.66 | | | $ | 3.85 | | (1)For purposes of calculating net income per share under the if-converted method, the Company has included the impact of the MCPS dividends for the year ended December 31, 2021 as the impact was more dilutive to net income per share than the impact of assuming the conversion of the MCPS into ordinary shares on a weighted average basis. The Company has excluded the impact of the MCPS dividends for the year ended December 31, 2020, as the assumed conversion of the MCPS into ordinary shares on a weighted average basis was more dilutive to net income per share than the impact of the MCPS dividends.Share Repurchase ProgramsIn April 2016, the Board of Directors authorized a share repurchase program of up to $1.5 billion of ordinary shares, which commenced in September 2016. This share repurchase program provides for share purchases in the open market or in privately negotiated transactions, depending on share price, market conditions and other factors, as determined by the Company.There were no shares repurchased during the year ended December 31, 2021. A summary of the ordinary shares repurchased during the years ended December 31, 2020 and 2019 is as follows: | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | Year Ended December 31, | | | | | | | 2020 | | 2019 | | | | Total number of shares repurchased | | | 1,059,075 | | | 5,387,533 | | | | | Average price paid per share | | | $ | 53.73 | | | $ | 77.93 | | | | | Total (in millions) | | | $ | 57 | | | $ | 420 | | | | As of December 31, 2021, approximately $13 million of share repurchases remained available under the April 2016 share repurchase program, which is in addition to the share repurchase program of up to $2.0 billion that was previously announced in January 2019. This program, which will commence following the completion of the April 2016 share repurchase program, provides for share purchases in the open market or in privately negotiated transactions, depending on share price, market conditions and other factors, as determined by the Company. All repurchased shares were retired, and are reflected as a reduction of ordinary share capital for the par value of the shares, with the excess applied as reductions to additional paid-in-capital and retained earnings.100

string

Recognition period

1.72

SEC-NUM

[Table of Contents](#i6266d2788e5849989ad57be380853c2d_7)Entergy Corporation and SubsidiariesNotes to Financial Statements A summary of stock option activity for the year ended December 31, 2021 and changes during the year are presented below: | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | Numberof Options | | Weighted-AverageExercisePrice | | AggregateIntrinsicValue | | Weighted-AverageContractual Life | | Options outstanding as of January 1, 2021 | 2,399,379 | | | $89.63 | | | | | | Options granted | 508,704 | | | $95.87 | | | | | | Options exercised | (72,138) | | | $80.54 | | | | | | Options forfeited/expired | (16,301) | | | $117.89 | | | | | | Options outstanding as of December 31, 2021 | 2,819,644 | | | $90.82 | | $71,110,949 | | 6.34 years | | Options exercisable as of December 31, 2021 | 1,788,702 | | | $81.91 | | $58,164,228 | | 5.16 years | | Weighted-average grant-date fair value of options granted during 2021 | $12.27 | | | | | | | The weighted-average grant-date fair value of options granted during the year was $11.45 for 2020 and $8.32 for 2019. The total intrinsic value of stock options exercised was $2 million during 2021, $26 million during 2020, and $29 million during 2019. The intrinsic value, which has no effect on net income, of the outstanding stock options exercised is calculated by the positive difference between the weighted average exercise price of the stock options granted and Entergy Corporation’s common stock price as of December 31, 2021. The aggregate intrinsic value of the stock options outstanding as of December 31, 2021 was $71.1 million. Stock options outstanding as of December 31, 2021 includes 501,316 out of the money options with an intrinsic value of zero. Entergy recognizes compensation cost over the vesting period of the options based on their grant-date fair value. The total fair value of options that vested was approximately $5 million during 2021, $5 million during 2020, and $5 million during 2019. Cash received from option exercises was $6 million for the year ended December 31, 2021. The tax benefits realized from options exercised was $0.5 million for the year ended December 31, 2021. The following table summarizes information about stock options outstanding as of December 31, 2021: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Options Outstanding | | Options Exercisable | | Range of Exercise Price | | As of December 31, 2021 | | Weighted-Average Remaining Contractual Life-Yrs. | | Weighted Average Exercise Price | | Number Exercisable as of December 31, 2021 | | Weighted Average Exercise Price | | | | | | | | | | | | | | | $51 | - | $64.99 | | 240,200 | | | 1.72 | | $63.69 | | 240,200 | | | $63.69 | | $65 | - | $78.99 | | 915,839 | | | 5.19 | | $73.80 | | 915,839 | | | $73.80 | | $79 | - | $91.99 | | 653,585 | | | 6.21 | | $89.35 | | 465,577 | | | $89.41 | | $92 | - | $131.72 | | 1,010,020 | | | 8.58 | | $113.66 | | 167,086 | | | $131.72 | | $51 | - | $131.72 | | 2,819,644 | | | 6.34 | | $90.82 | | 1,788,702 | | | $81.91 | Stock-based compensation cost related to non-vested stock options outstanding as of December 31, 2021 not yet recognized is approximately $7 million and is expected to be recognized over a weighted-average period of 1.72 years. Restricted Stock Awards Entergy grants restricted stock awards earned under its stock benefit plans in the form of stock units. One-third of the restricted stock awards will vest upon each anniversary of the grant date and are expensed ratably over 191

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Auditor Firm ID

238

SEC-NUM

ITEM 9A. Controls and Procedures. Evaluation of Disclosure Controls and Procedures. James D. Farley, Jr., our Chief Executive Officer (“CEO”), and John T. Lawler, our Chief Financial Officer (“CFO”), have performed an evaluation of the Company’s disclosure controls and procedures, as that term is defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended (“Exchange Act”), as of December 31, 2021, and each has concluded that such disclosure controls and procedures are effective to ensure that information required to be disclosed in our periodic reports filed under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified by SEC rules and forms, and that such information is accumulated and communicated to the CEO and CFO to allow timely decisions regarding required disclosures. Management’s Report on Internal Control Over Financial Reporting. Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or because the degree of compliance with policies or procedures may deteriorate. Under the supervision and with the participation of our management, including our CEO and CFO, we conducted an assessment of the effectiveness of our internal control over financial reporting as of December 31, 2021. The assessment was based on criteria established in the framework Internal Control - Integrated Framework (2013), issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this assessment, management concluded that our internal control over financial reporting was effective as of December 31, 2021. The effectiveness of the Company’s internal control over financial reporting as of December 31, 2021 has been audited by PricewaterhouseCoopers LLP (PCAOB ID 238), an independent registered public accounting firm, as stated in its report included herein. Changes in Internal Control Over Financial Reporting. There were no changes in internal control over financial reporting during the quarter ended December 31, 2021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. ITEM 9B. Other Information. None. ITEM 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections. Not applicable. 97

string

Risk-free interest rate (as a percent)

0.2

SEC-NUM

[Table of Contents](#ifd0dff1f28084ac0b92d7f0a49d14a91_7)The following assumptions were used to estimate the fair value of performance share units granted during the nine month periods ended September 30, 2022 and 2021 using the Monte Carlo simulation pricing model. | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | For the Nine Month Period Ended September 30, | | Assumptions | 2022 | | 2021 | | Expected term (in years) | 2.9 - 5.0 | | 2.9 | | Risk-free interest rate | 1.7% - 3.4% | | 0.2 | % | | Assumed volatility | 35.0% - 36.4% | | 36.9 | % | | Expected dividend rate | 0.2 | % | | — | % | Note 11. Accumulated Other Comprehensive LossThe Company’s other comprehensive income (loss) consists of (i) unrealized foreign currency net gains and losses on the translation of the assets and liabilities of its foreign operations; (ii) realized and unrealized foreign currency gains and losses on certain hedges of net investments in foreign operations, net of income taxes; (iii) unrealized gains and losses on cash flow hedges (consisting of interest rate swap and cap contracts), net of income taxes; and (iv) pension and other postretirement prior service cost and actuarial gains or losses, net of income taxes. See Note 8 “[Benefit Plans](#ifd0dff1f28084ac0b92d7f0a49d14a91_67)” and Note 12 “[Hedging Activities, Derivative Instruments and Fair Value Measurements](#ifd0dff1f28084ac0b92d7f0a49d14a91_85).”The before tax income (loss) and related income tax effect are as follows. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | For the Three Month Period Ended September 30, | | | 2022 | | 2021 | | | Before-Tax Amount | | Tax Benefit or (Expense) | | Net of Tax Amount | | Before-Tax Amount | | Tax Benefit or (Expense) | | Net of Tax Amount | | Foreign currency translation adjustments, net | $ | (207.9) | | | $ | — | | | $ | (207.9) | | | $ | (52.1) | | | $ | 4.5 | | | $ | (47.6) | | | Unrecognized gains on cash flow hedges | 26.1 | | | (6.5) | | | 19.6 | | | — | | | — | | | — | | | Pension and other postretirement benefit prior service cost and gain or loss, net | 7.0 | | | (1.7) | | | 5.3 | | | 2.4 | | | (0.6) | | | 1.8 | | | Other comprehensive loss | $ | (174.8) | | | $ | (8.2) | | | $ | (183.0) | | | $ | (49.7) | | | $ | 3.9 | | | $ | (45.8) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | For the Nine Month Period Ended September 30, | | | 2022 | | 2021 | | | Before-Tax Amount | | Tax Benefit or (Expense) | | Net of Tax Amount | | Before-Tax Amount | | Tax Benefit or (Expense) | | Net of Tax Amount | | Foreign currency translation adjustments, net | $ | (413.0) | | | $ | (35.8) | | | $ | (448.8) | | | $ | (108.3) | | | $ | 10.0 | | | $ | (98.3) | | | Unrecognized gains on cash flow hedges | 19.8 | | | (5.6) | | | 14.2 | | | — | | | — | | | — | | | Pension and other postretirement benefit prior service cost and gain or loss, net | 2.9 | | | (0.7) | | | 2.2 | | | 5.4 | | | (1.1) | | | 4.3 | | | Other comprehensive loss | $ | (390.3) | | | $ | (42.1) | | | $ | (432.4) | | | $ | (102.9) | | | $ | 8.9 | | | $ | (94.0) | | The tables above include only the other comprehensive loss, net of tax, attributable to Ingersoll Rand Inc. Other comprehensive income (loss), net of tax, attributable to noncontrolling interest holders was $(1.9) million and $0.2 million for the three month periods ended September 30, 2022 and 2021, respectively, and $(6.1) million and $(2.1) million for the nine month periods ended September 30, 2022 and 2021, respectively, and related entirely to foreign currency translation adjustments.23

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Maximum priority debt to total assets ratio (percent)

15

SEC-NUM

[T](#ic6799676e16f4a73b9fbe61f891b870d_7)[able of Contents](#ic6799676e16f4a73b9fbe61f891b870d_7)NOTE 4: FINANCING ARRANGEMENTSThe components of our short-term and long-term debt and the associated interest rates were as follows (dollars in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Average interest rate as of | | | | Carrying value as of | | | | December 31, 2021 | | December 31, 2020 | | Maturity | | December 31, 2021 | | December 31, 2020 | | Revolving credit facility | | 1.23 | % | | — | % | | October 2023 | | $ | 525,000 | | | $ | — | | | Senior Notes, Series A | | 3.97 | % | | 3.97 | % | | August 2023 | | 175,000 | | | 175,000 | | | Senior Notes, Series B | | 4.26 | % | | 4.26 | % | | August 2028 | | 150,000 | | | 150,000 | | | Senior Notes, Series C | | 4.60 | % | | 4.60 | % | | August 2033 | | 175,000 | | | 175,000 | | | Receivables securitization facility (1) | | 0.73 | % | | — | % | | November 2023 | | 299,481 | | | — | | | Senior Notes (1) | | 4.20 | % | | 4.20 | % | | April 2028 | | 594,168 | | | 593,301 | | | Total debt | | 1,918,649 | | | 1,093,301 | | | Less: Current maturities and short-term borrowing | | (525,000) | | | — | | | Long-term debt | | $ | 1,393,649 | | | $ | 1,093,301 | | \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ (1) Net of unamortized discounts and issuance costs.SENIOR UNSECURED REVOLVING CREDIT FACILITYWe have a senior unsecured revolving credit facility (the “Credit Agreement”) with a total availability of $1 billion and a maturity date of October 24, 2023. Borrowings under the Credit Agreement generally bear interest at a variable rate determined by a pricing schedule or the base rate (which is the highest of (a) the administrative agent's prime rate, (b) the federal funds rate plus 0.50 percent, or (c) the sum of one-month LIBOR plus a specified margin). As of December 31, 2021, the variable rate equaled LIBOR plus 1.13 percent. In addition, there is a commitment fee on the average daily undrawn stated amount under each letter of credit issued under the facility ranging from 0.075 percent to 0.200 percent. The recorded amount of borrowings outstanding approximates fair value because of the short maturity period of the debt; therefore, we consider these borrowings to be a Level 2 financial liability. The Credit Agreement contains various restrictions and covenants that require us to maintain certain financial ratios, including a maximum leverage ratio of 3.50 to 1.00. The Credit Agreement also contains customary events of default. If an event of default under the Credit Agreement occurs and is continuing, then the administrative agent may declare any outstanding obligations under the Credit Agreement to be immediately due and payable. In addition, if we become the subject of voluntary or involuntary proceedings under any bankruptcy, insolvency, or similar law, then any outstanding obligations under the Credit Agreement will automatically become immediately due and payable. On November 19, 2021, we amended the Credit Agreement to among other things, facilitate the terms of the Receivables Securitization Facility and include provisions for benchmark replacements to LIBOR. NOTE PURCHASE AGREEMENTOn August 23, 2013, we entered into a Note Purchase Agreement with certain institutional investors (the “Purchasers”). On August 27, 2013, the Purchasers purchased an aggregate principal amount of $500 million of our Senior Notes, Series A, Senior Notes Series B, and Senior Notes Series C, collectively (the “Notes”). Interest on the Notes is payable semi-annually in arrears. The fair value of the Notes approximated $543.5 million at December 31, 2021. We estimate the fair value of the Notes primarily using an expected present value technique, which is based on observable market inputs using interest rates currently available to companies of similar credit standing for similar terms and remaining maturities, and considering our own risk. If the Notes were recorded at fair value, they would be classified as Level 2. The Note Purchase Agreement contains various restrictions and covenants that require us to maintain certain financial ratios, including a maximum leverage ratio of 3.00 to 1.00, a minimum interest coverage ratio of 2.00 to 1.00, and a maximum consolidated priority debt to consolidated total asset ratio of 15 percent. The Note Purchase Agreement provides for customary events of default. The occurrence of an event of default would permit certain Purchasers to declare certain Notes then outstanding to be immediately due and payable. Under the terms of the Note Purchase Agreement, the Notes are redeemable, in whole or in part, at 100 percent of the principal amount being redeemed together with a “make-whole amount” (as defined in the Note Purchase Agreement), and accrued and unpaid interest with respect to each Note. The obligations of the company under the Note Purchase Agreement and the Notes are guaranteed by C.H. Robinson Company, a Delaware corporation and a wholly-owned subsidiary of the company, and by C.H. Robinson 50

string

Payment on debt

250.0

SEC-NUM

[Table of Contents](#ie0ad6752ee3c4f669c939c9f55a2eff4_10) FRANKLIN RESOURCES, INC.CONSOLIDATED STATEMENTS OF CASH FLOWSUnaudited[Table continued from previous page] | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Nine Months Ended June 30, | | (in millions) | | 2022 | | 2021 | | | | | | | | Issuance of common stock | | $ | 13.6 | | | $ | 11.0 | | | Dividends paid on common stock | | (437.1) | | | (418.6) | | | Repurchase of common stock | | (154.0) | | | (135.8) | | | Proceeds from issuance of debt | | — | | | 748.3 | | | Payment of debt issuance costs | | — | | | (6.7) | | | Payment on debt | | — | | | (250.0) | | | Proceeds from debt of consolidated investment products | | 4,345.2 | | | 1,636.2 | | | Payments on debt of consolidated investment products | | (2,469.3) | | | (488.7) | | | Payments on contingent consideration liabilities | | (4.1) | | | — | | | Noncontrolling interests | | 194.9 | | | 447.2 | | | Net cash provided by financing activities | | 1,489.2 | | | 1,542.9 | | | Effect of exchange rate changes on cash and cash equivalents | | (68.1) | | | 25.1 | | | Increase (decrease) in cash and cash equivalents | | (168.5) | | | 371.3 | | | Cash and cash equivalents, beginning of period | | 4,647.2 | | | 3,989.8 | | | Cash and Cash Equivalents, End of Period | | $ | 4,478.7 | | | $ | 4,361.1 | | | | | | | | | Supplemental Disclosure of Cash Flow Information | | | | | | Cash paid for income taxes | | $ | 456.7 | | | $ | 434.6 | | | Cash paid for interest | | 61.8 | | | 76.2 | | | Cash paid for interest by consolidated investment products | | 107.0 | | | 75.7 | | See Notes to Consolidated Financial Statements. 9

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Equity Method Investment, Ownership Percentage

27

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[Table of Contents](#i8b61521b6679450490d14f6570be754a_7)Goodwill activity consisted of the following for the periods ended June 30, 2022 and December 31, 2021: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (in millions) | | Balance at December 31, 2021 | | Deconsolidation (1) | | | | OtherActivity (2) | | Balance at June 30, 2022 | | CBOT Holdings | | $ | 5,066.4 | | | $ | — | | | | | $ | — | | | $ | 5,066.4 | | | NYMEX Holdings | | 2,462.2 | | | — | | | | | — | | | 2,462.2 | | | NEX | | 2,959.0 | | | — | | | | | (43.9) | | | 2,915.1 | | | Other | | 40.4 | | | — | | | | | — | | | 40.4 | | | Total Goodwill | | $ | 10,528.0 | | | $ | — | | | | | $ | (43.9) | | | $ | 10,484.1 | | | (in millions) | | Balance at December 31, 2020 | | Deconsolidation (1) | | | | OtherActivity (2) | | Balance at December 31, 2021 | | CBOT Holdings | | $ | 5,066.4 | | | $ | — | | | | | $ | — | | | $ | 5,066.4 | | | NYMEX Holdings | | 2,462.2 | | | — | | | | | — | | | 2,462.2 | | | NEX | | 3,229.8 | | | (246.2) | | | | | (24.6) | | | 2,959.0 | | | Other | | 40.4 | | | — | | | | | — | | | 40.4 | | | Total Goodwill | | $ | 10,798.8 | | | $ | (246.2) | | | | | $ | (24.6) | | | $ | 10,528.0 | | \_\_\_\_\_\_\_\_\_\_(1) The activity from deconsolidation includes goodwill as part of the contribution of the net assets of the optimization business to OSTTRA.(2) Other activity includes currency translation adjustments.6. Long-Term InvestmentsIn June 2022, the company invested $410.0 million in S&P/Dow Jones Indices LLC (S&P/DJI), which S&P/DJI used as part of the consideration for its acquisition of the IHS Markit index business. Following the additional contribution, the company's ownership interest remained at 27%. At June 30, 2022, the company's investment in S&P/DJI was $1.4 billion. 7. DebtShort-term debt consisted of the following at June 30, 2022 and December 31, 2021: | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | (in millions) | | June 30, 2022 | | December 31, 2021 | | $750.0 million fixed rate notes due September 2022, stated rate of 3.00% (1) | | — | | | 749.4 | | | Total short-term debt | | $ | — | | | $ | 749.4 | | (1)The company maintained a forward-starting interest rate swap agreement that modified the interest obligation associated with these notes so that the interest payable on the notes effectively became fixed at a rate of 3.32%.Long-term debt consisted of the following at June 30, 2022 and December 31, 2021: | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | (in millions) | | June 30, 2022 | | December 31, 2021 | | €15.0 million fixed rate notes due May 2023, stated rate of 4.30% | | 15.6 | | | 16.8 | | | $750.0 million fixed rate notes due March 2025, stated rate of 3.00% (1) | | 748.1 | | | 747.7 | | | $500.0 million fixed rate notes due June 2028, stated rate of 3.75% | | 497.4 | | | 497.2 | | | $750.0 million fixed rate notes due March 2032, stated rate of 2.65% | | 741.3 | | | — | | | $750.0 million fixed rate notes due September 2043, stated rate of 5.30% (2) | | 743.5 | | | 743.4 | | | $700.0 million fixed rate notes due June 2048, stated rate of 4.15% | | 690.8 | | | 690.6 | | | Total long-term debt | | $ | 3,436.7 | | | $ | 2,695.7 | | (1)The company maintained a forward-starting interest rate swap agreement that modified the interest obligation associated with these notes so that the interest payable on the notes effectively became fixed at a rate of 3.11%.(2)The company maintained a forward-starting interest rate swap agreement that modified the interest obligation associated with these notes so that the interest payable on the notes effectively became fixed at a rate of 4.73%. 18

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Business combination, consideration transferred

15,942

SEC-NUM

(2)Includes charges related to legal settlement costs.(3)Includes lease impairment charges incurred from the Merger with N&B.Charges by SegmentThe following table summarizes the total amount of costs incurred in connection with these restructuring programs by segment: | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | December 31, | | (DOLLARS IN MILLIONS) | 2021 | | 2020 | | 2019 | | Nourish | $ | 32 | | | $ | 10 | | | $ | 17 | | | Health & Biosciences | 5 | | | — | | | 1 | | | Scent | 3 | | | 7 | | | 12 | | | Pharma Solutions | 1 | | | — | | | — | | | Total Restructuring and other charges | $ | 41 | | | $ | 17 | | | $ | 30 | | NOTE 3. ACQUISITIONSTransaction with Nutrition & Biosciences, Inc.On February 1, 2021, IFF completed the Merger with N&B. Pursuant to the transaction related agreements, DuPont transferred its N&B Business to N&B, a wholly-owned subsidiary of DuPont, and N&B merged with and into a wholly owned subsidiary of IFF in exchange for 141,740,461 shares of IFF common stock, par value $0.125 per share (“IFF Common Stock”).The Company completed its Merger with N&B in a Reverse Morris Trust transaction (the “Transactions”), pursuant to which the Company acquired the N&B Business of DuPont. In the Transactions, among other steps (i) DuPont transferred the N&B Business to N&B (the “Separation”); (ii) N&B made a cash distribution to DuPont of approximately $7.359 billion, subject to certain adjustments (the “Special Cash Payments”); (iii) DuPont distributed to its stockholders all of the issued and outstanding shares of N&B common stock by way of an exchange offer (the “Distribution”), and; (iv) N&B merged with and into a wholly owned subsidiary of IFF. As a result of the Merger, the existing shares of N&B common stock were automatically converted into the right to receive a number of shares of IFF Common Stock. Immediately after the Merger, holders of DuPont’s common stock that received shares of N&B common stock in the Distribution owned approximately 55.4% of the outstanding shares of IFF Common Stock on a fully diluted basis and existing holders of IFF Common Stock owned approximately 44.6% of the outstanding shares of IFF on a fully diluted basis.The Merger was accounted for using the purchase method of accounting in accordance with ASC Topic 805, Business Combinations, with IFF identified as the acquirer. As a result of the Merger, N&B’s assets, liabilities and the operating results of N&B were included in the Company’s financial statements from the Closing Date. N&B contributed net sales of approximately $6.084 billion and net income of approximately $11 million for the year ended December 31, 2021, which includes the effects of purchase accounting adjustments, primarily related to changes in amortization of intangible assets, depreciation of property, plant and equipment and amortization of stepped up inventory.Prior to the Distribution, N&B incurred new indebtedness in the form of term loans and senior notes in an aggregate principal amount of $7.500 billion to pay the Special Cash Payments made to DuPont stockholders. See Note 9 for additional information regarding the new term loans and senior notes incurred by N&B and subsequently assumed by IFF.Purchase PriceThe following table summarizes the aggregate purchase price consideration paid to acquire N&B (in millions, except share and per share data): | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | (DOLLARS IN MILLIONS) | | | Fair value of common stock issued to DuPont stockholders(1) | $ | 15,929 | | | Fair value attributable to pre-merger service for replacement equity awards(2) | 25 | | | Pension funding adjustment(3) | (12) | | | Total purchase consideration | $ | 15,942 | | \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ (1)The fair value of common stock issued to DuPont stockholders represents 141,740,461 shares of the Company's common stock determined based on the number of fully diluted shares of IFF common stock, immediately prior to the Closing Date, multiplied by the quotient of 55.4%/44.6% and IFF common stock closing share price of $112.38 on the New York Stock Exchange on the Closing Date. 65

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Lessee, Operating Lease, Liability, Payments, Due Year Five

38

SEC-NUM

[Table of Contents](#i5ec3aabfaa534f9c8fa2d2a5b7677d19_7) Supplemental balance sheet information related to leases was as follows: | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | December 31, | | | | | 2021 | | 2020 | | | | | | | | | | | | (dollars in millions) | | Operating leases: | | | | | | | Operating lease right-of-use assets | | | $ | 383 | | | $ | 380 | | | Accrued liabilities (Note 8) | | | $ | 92 | | | $ | 100 | | | Long-term operating lease liabilities | | | 304 | | | 300 | | | Total operating lease liabilities | | | $ | 396 | | | $ | 400 | | | | | | | | | | Finance leases: | | | | | | | Property and equipment | | | $ | 26 | | | $ | 31 | | | Less: accumulated depreciation | | | (15) | | | (13) | | | Total property, net | | | $ | 11 | | | $ | 18 | | | Short-term debt (Note 11) | | | $ | 3 | | | $ | 4 | | | Long-term debt (Note 11) | | | 10 | | | 14 | | | Total finance lease liabilities | | | $ | 13 | | | $ | 18 | | | | | | | | | | Weighted average remaining lease term: | | | | | | | Operating leases | | | 6 years | | 6 years | | Finance leases | | | 5 years | | 6 years | | | | | | | | | Weighted average discount rate: | | | | | | | Operating leases | | | 3.00 | % | | 3.25 | % | | Finance leases | | | 3.50 | % | | 3.50 | % | Maturities of lease liabilities were as follows: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | OperatingLeases | | Finance Leases | | | | | | | | (in millions) | | As of December 31, 2021 | | | | | 2022 | $ | 103 | | | $ | 3 | | | 2023 | 86 | | | 3 | | | 2024 | 62 | | | 3 | | | 2025 | 50 | | | 2 | | | 2026 | 38 | | | 2 | | | Thereafter | 92 | | | 2 | | | Total lease payments | 431 | | | 15 | | | Less: imputed interest | (35) | | | (2) | | | Total | $ | 396 | | | $ | 13 | | | | | | | As of December 31, 2021, the Company has entered into additional operating leases, primarily for real estate, that have not yet commenced of approximately $15 million. These operating leases are anticipated to commence primarily in 2022 with lease terms of approximately 10 years. 125

string

Realized gain on equity securities

14

SEC-NUM

CAESARS ENTERTAINMENT, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)determined on an individual asset basis based upon quoted prices of identical assets available in active markets (Level 1), quoted prices of identical assets in inactive markets, or quoted prices for similar assets in active and inactive markets (Level 2), and represent the amounts the Company would expect to receive if the Company sold these marketable securities.The Company held common shares of Flutter Entertainment PLC (“Flutter”), which is a publicly traded company with a readily determinable share price. The Flutter shares contained certain restrictions which expired in December 2020. As such, the shares were transferred from a Level 3 investment to a Level 1 investment. There were no other transfers between Level 1, Level 2 and Level 3 investments. During the year ended December 31, 2020, the Company sold a portion of these shares for $24 million and recorded a gain of $14 million. As of December 31, 2020, the fair value of shares held was $10 million, and was included in Prepayments and other current assets on the Balance Sheets. On July 7, 2021, the Company sold these shares for $9 million and recorded a loss of $1 million during the year ended December 31, 2021. Gains and losses have been included in Other income (loss) on the Statements of Operations.Derivative InstrumentsThe Company does not purchase or hold any derivative financial instruments for trading purposes.5% Convertible Notes - Derivative LiabilityOn October 6, 2017, Former Caesars issued $1.1 billion aggregate principal amount of 5% convertible senior notes maturing in 2024 (“5% Convertible Notes”) which contained a derivative liability. On June 29, 2021, all outstanding 5% Convertible Notes were converted as a result of our mandatory conversion. See Note 12 for further discussion. The derivative liability associated with the conversion feature no longer exists following the mandatory conversion.Forward contractsThe Company has entered into several foreign exchange forward contracts with third parties to hedge the risk of fluctuations in the foreign exchange rates between USD and GBP and to fix the exchange rate for a portion of the funds used in the William Hill Acquisition, repayment of related debt, and expected proceeds of the sale of the international operations. Three of these forward contracts to purchase £724 million at a contracted exchange rate were settled on June 11, 2021 and December 31, 2021, resulting in total gains of $38 million, which were recorded in the Other income (loss) on the Statements of Operations. As of December 31, 2021, the Company is contracted to sell a total of £790 million at fixed exchange rates. These contracts are to hedge the risk of fluctuations in the foreign exchange rate related to a portion of the expected proceeds from the sale of William Hill International. The forward term of these contracts ends in March 2022. The Company recorded a loss of $15 million during the year ended December 31, 2021, related to these forward contracts, which was recorded in the Other income (loss) on the Statements of Operations. Interest Rate Swap DerivativesWe assumed Former Caesars’ interest rate swaps to manage the mix of assumed debt between fixed and variable rate instruments. As of December 31, 2021, we have four interest rate swap agreements to fix the interest rate on $1.3 billion of variable rate debt related to the CRC Credit Agreement. The interest rate swaps are designated as cash flow hedging instruments. The difference to be paid or received under the terms of the interest rate swap agreements is accrued as interest rates change and recognized as an adjustment to interest expense at settlement. Changes in the variable interest rates to be received pursuant to the terms of the interest rate swap agreements will have a corresponding effect on future cash flows.The major terms of the interest rate swap agreements as of December 31, 2021 were as follows: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Effective Date | | Notional Amount(In millions) | | Fixed Rate Paid | | Variable Rate Received as of December 31, 2021 | | | | Maturity Date | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1/1/2019 | | 250 | | 2.274% | | 0.09038% | | | | 12/31/2022 | | | | | | | | | | | | | | | | | | | | | | | | | | 1/1/2019 | | 200 | | 2.828% | | 0.09038% | | | | 12/31/2022 | | 1/1/2019 | | 200 | | 2.828% | | 0.09038% | | | | 12/31/2022 | | 1/1/2019 | | 600 | | 2.739% | | 0.09038% | | | | 12/31/2022 | | | | | | | | | | | | | Valuation MethodologyThe estimated fair values of our interest rate swap derivative instruments are derived from market prices obtained from dealer quotes for similar, but not identical, assets or liabilities. Such quotes represent the estimated amounts we would receive or pay [Table of Contents](#i37dfc5eabc12461dbfc5ef573d80947e_7)89

string

Number Of Encumbered Units Held For Sale

23

SEC-NUM

INVITATION HOMES INC. Schedule III Real Estate and Accumulated Depreciation As of December 31, 2021 (dollar amounts in thousands) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Initial Cost to Company | | Cost Capitalized Subsequent to Acquisition | | Gross Amount at Close of Period | | | | | | | | | | | | Market | | Number ofProperties(1) | | Number ofEncumberedProperties(2) | | Encumbrances(2) | | Land | | DepreciableProperties | | Land | | DepreciableProperties | | Land | | DepreciableProperties | | Total(3) | | AccumulatedDepreciation | | Date ofConstruction | | DateAcquired | | DepreciablePeriod | | Atlanta | | 12,654 | | | 5,394 | | | $ | 449,672 | | | $ | 329,677 | | | $ | 1,650,049 | | | $ | — | | | $ | 295,913 | | | $ | 329,677 | | | $ | 1,945,962 | | | $ | 2,275,639 | | | $ | (411,684) | | | 1920-2021 | | 2012-2021 | | 7 | - | 28.5 years | | Carolinas | | 5,253 | | | 1,944 | | | 189,851 | | | 191,336 | | | 827,923 | | | — | | | 116,675 | | | 191,336 | | | 944,598 | | | 1,135,934 | | | (165,821) | | | 1900-2021 | | 2012-2021 | | 7 | - | 28.5 years | | Chicago | | 2,562 | | | — | | | — | | | 129,440 | | | 318,687 | | | — | | | 112,061 | | | 129,440 | | | 430,748 | | | 560,188 | | | (112,709) | | | 1877-2015 | | 2012-2017 | | 7 | - | 28.5 years | | Dallas | | 2,855 | | | 972 | | | 111,574 | | | 133,738 | | | 498,266 | | | — | | | 43,051 | | | 133,738 | | | 541,317 | | | 675,055 | | | (66,097) | | | 1952-2021 | | 2017-2021 | | 7 | - | 28.5 years | | Denver | | 2,658 | | | 1,179 | | | 183,917 | | | 235,501 | | | 646,090 | | | — | | | 58,147 | | | 235,501 | | | 704,237 | | | 939,738 | | | (82,030) | | | 1885-2021 | | 2017-2021 | | 7 | - | 28.5 years | | Houston | | 2,130 | | | 583 | | | 49,094 | | | 63,316 | | | 308,550 | | | — | | | 21,557 | | | 63,316 | | | 330,107 | | | 393,423 | | | (49,921) | | | 1954-2014 | | 2017-2021 | | 7 | - | 28.5 years | | Jacksonville | | 1,902 | | | 843 | | | 82,990 | | | 88,837 | | | 231,394 | | | — | | | 60,061 | | | 88,837 | | | 291,455 | | | 380,292 | | | (81,905) | | | 1955-2021 | | 2012-2021 | | 7 | - | 28.5 years | | Las Vegas | | 3,100 | | | 1,864 | | | 236,798 | | | 137,948 | | | 601,198 | | | — | | | 59,527 | | | 137,948 | | | 660,725 | | | 798,673 | | | (107,885) | | | 1953-2019 | | 2012-2021 | | 7 | - | 28.5 years | | Minneapolis | | 1,118 | | | 55 | | | 8,276 | | | 66,254 | | | 136,962 | | | — | | | 54,842 | | | 66,254 | | | 191,804 | | | 258,058 | | | (56,072) | | | 1886-2015 | | 2013-2015 | | 7 | - | 28.5 years | | Northern California | | 4,400 | | | 1,881 | | | 273,321 | | | 361,348 | | | 797,449 | | | — | | | 126,809 | | | 361,348 | | | 924,258 | | | 1,285,606 | | | (195,571) | | | 1900-2017 | | 2012-2021 | | 7 | - | 28.5 years | | Orlando | | 6,366 | | | 2,452 | | | 223,805 | | | 227,319 | | | 916,287 | | | — | | | 166,090 | | | 227,319 | | | 1,082,377 | | | 1,309,696 | | | (219,046) | | | 1947-2021 | | 2012-2021 | | 7 | - | 28.5 years | | Phoenix | | 8,742 | | | 3,687 | | | 365,443 | | | 370,676 | | | 1,190,732 | | | — | | | 208,281 | | | 370,676 | | | 1,399,013 | | | 1,769,689 | | | (260,224) | | | 1925-2021 | | 2012-2021 | | 7 | - | 28.5 years | | Seattle | | 4,027 | | | 1,131 | | | 138,819 | | | 328,674 | | | 727,263 | | | — | | | 167,256 | | | 328,674 | | | 894,519 | | | 1,223,193 | | | (165,607) | | | 1890-2021 | | 2012-2021 | | 7 | - | 28.5 years | | South Florida | | 8,229 | | | 1,897 | | | 238,158 | | | 713,672 | | | 1,479,921 | | | — | | | 232,684 | | | 713,672 | | | 1,712,605 | | | 2,426,277 | | | (395,281) | | | 1922-2021 | | 2012-2021 | | 7 | - | 28.5 years | | Southern California | | 7,860 | | | 3,608 | | | 633,175 | | | 1,011,995 | | | 1,506,186 | | | — | | | 238,975 | | | 1,011,995 | | | 1,745,161 | | | 2,757,156 | | | (392,605) | | | 1900-2014 | | 2012-2021 | | 7 | - | 28.5 years | | Tampa | | 8,445 | | | 2,771 | | | 282,238 | | | 348,207 | | | 1,259,266 | | | — | | | 212,291 | | | 348,207 | | | 1,471,557 | | | 1,819,764 | | | (310,601) | | | 1923-2021 | | 2012-2021 | | 7 | - | 28.5 years | | Total | | 82,301 | | | 30,261 | | | $ | 3,467,131 | | | $ | 4,737,938 | | | $ | 13,096,223 | | | $ | — | | | $ | 2,174,220 | | | $ | 4,737,938 | | | $ | 15,270,443 | | | $ | 20,008,381 | | | $ | (3,073,059) | | | | | | | | | | | | | | | --- | --- | --- | | | | | | | (1)Number of properties represents 82,381 total properties owned less 80 properties classified as held for sale and recorded in other assets, net on the consolidated balance sheet as of December 31, 2021.(2)Number of encumbered properties and encumbrances include the number of properties secured by first priority mortgages under the mortgage loans and the Secured Term Loan, as well as the aggregate value of outstanding debt attributable to such properties. Excluded from this is original issue discount, deferred financing costs, and 23 held for sale properties with an encumbered balance of $3,789.(3)The gross aggregate cost of total real estate in the table above for federal income tax purposes was approximately $18.2 billion (unaudited) as of December 31, 2021. F-45

string

Common stock, shares authorized (in shares)

120,000

SEC-NUM

CHARLES RIVER LABORATORIES INTERNATIONAL, INC.CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)(in thousands, except per share amounts) | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | September 24, 2022 | | December 25, 2021 | | | Assets | | | | | | Current assets: | | | | | | Cash and cash equivalents | $ | 193,701 | | | $ | 241,214 | | | | Trade receivables and contract assets, net of allowances for credit losses of $9,827 and $7,180, respectively | 770,776 | | | 642,881 | | | | Inventories | 261,522 | | | 199,146 | | | | Prepaid assets | 92,266 | | | 93,543 | | | | Other current assets | 97,087 | | | 97,311 | | | | Total current assets | 1,415,352 | | | 1,274,095 | | | | Property, plant and equipment, net | 1,380,568 | | | 1,291,068 | | | | Operating lease right-of-use assets, net | 373,410 | | | 292,941 | | | | Goodwill | 2,776,005 | | | 2,711,881 | | | | Client relationships, net | 909,899 | | | 981,398 | | | | Other intangible assets, net | 58,121 | | | 79,794 | | | | Deferred tax assets | 39,721 | | | 40,226 | | | | Other assets | 429,693 | | | 352,889 | | | | Total assets | $ | 7,382,769 | | | $ | 7,024,292 | | | | Liabilities, Redeemable Noncontrolling Interests and Equity | | | | | | Current liabilities: | | | | | | Current portion of long-term debt and finance leases | $ | 2,079 | | | $ | 2,795 | | | | Accounts payable | 181,629 | | | 198,130 | | | | Accrued compensation | 200,365 | | | 246,119 | | | | Deferred revenue | 251,473 | | | 219,703 | | | | Accrued liabilities | 196,754 | | | 228,797 | | | | Other current liabilities | 181,894 | | | 137,641 | | | | Total current liabilities | 1,014,194 | | | 1,033,185 | | | | Long-term debt, net and finance leases | 2,937,056 | | | 2,663,564 | | | | Operating lease right-of-use liabilities | 368,851 | | | 252,972 | | | | Deferred tax liabilities | 196,014 | | | 239,720 | | | | Other long-term liabilities | 194,710 | | | 242,859 | | | | Total liabilities | 4,710,825 | | | 4,432,300 | | | | Commitments and contingencies (Notes 2, 9, 11 and 13) | | | | | | Redeemable noncontrolling interests | 39,206 | | | 53,010 | | | | Equity: | | | | | | Preferred stock, $0.01 par value; 20,000 shares authorized; no shares issued and outstanding | — | | | — | | | | Common stock, $0.01 par value; 120,000 shares authorized; 51,006 shares issued and 50,877 shares outstanding as of September 24, 2022, and 50,480 shares issued and outstanding as of December 25, 2021 | 510 | | | 505 | | | | Additional paid-in capital | 1,780,876 | | | 1,718,304 | | | | Retained earnings | 1,279,567 | | | 980,751 | | | | Treasury stock, at cost, 129 and 0 shares, as of September 24, 2022 and December 25, 2021, respectively | (38,492) | | | — | | | | Accumulated other comprehensive loss | (395,608) | | | (164,740) | | | | Total equity attributable to common shareholders | 2,626,853 | | | 2,534,820 | | | | Noncontrolling interest | 5,885 | | | 4,162 | | | | Total equity | 2,632,738 | | | 2,538,982 | | | | Total liabilities, redeemable noncontrolling interests and equity | $ | 7,382,769 | | | $ | 7,024,292 | | | | See Notes to Unaudited Condensed Consolidated Financial Statements. | | 5

string

2022

306.6

SEC-NUM

Note 5. Goodwill and Other Intangible AssetsIn connection with the change in the Company's reporting structure that is discussed in Note 1, the Company reallocated goodwill among the impacted reporting units using a relative fair value approach and assessed impairment before and after goodwill was reallocated. The following is a summary of the changes in the carrying value of goodwill, by reportable segment, for the nine months ended June 30, 2022: | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | (in thousands) | | U. S. Healthcare Solutions | | International Healthcare Solutions | | Total | | Goodwill as of September 30, 2021 (as revised) | | $ | 6,260,374 | | | $ | 2,770,157 | | | $ | 9,030,531 | | | Purchase accounting adjustments | | — | | | 27,186 | | | 27,186 | | | Goodwill recognized in connection with acquisition | | 18,409 | | | — | | | 18,409 | | | Goodwill derecognized in connection with disposal | | (1,224) | | | — | | | (1,224) | | | Goodwill impairment | | — | | | (75,936) | | | (75,936) | | | Foreign currency translation | | (2,662) | | | (364,180) | | | (366,842) | | | Goodwill as of June 30, 2022 | | $ | 6,274,897 | | | $ | 2,357,227 | | | $ | 8,632,124 | | As a result of a prolonged decline in Profarma’s stock price, the Company performed an impairment assessment over the Profarma reporting unit as of June 30, 2022 and recorded a goodwill impairment of $75.9 million in the three months ended June 30, 2022. The Company determined the fair value of the Profarma reporting unit based upon Profarma’s publicly-traded stock price, plus an estimated control premium. This represents a level 2 nonrecurring fair value measurement. In connection with the Profarma impairment assessment, the Company first performed a recoverability assessment of Profarma’s long-lived assets by comparing the undiscounted cash flows to the carrying value of the Profarma asset group, and it was determined to be recoverable. However, the forecasted undiscounted cash flows used to perform the recoverability assessment are inherently uncertain and include assumptions that could differ from actual results in future periods.The following is a summary of other intangible assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | June 30, 2022 | | September 30, 2021 | | (in thousands) | | Weighted Average Remaining Useful Life | | GrossCarryingAmount | | AccumulatedAmortization | | NetCarryingAmount | | GrossCarryingAmount | | AccumulatedAmortization | | NetCarryingAmount | | Indefinite-lived trade names | | | | $ | 668,085 | | | $ | — | | | $ | 668,085 | | | $ | 668,119 | | | $ | — | | | $ | 668,119 | | | Finite-lived: | | | | | | | | | | | | | | | | Customer relationships | | 16 years | | 4,420,018 | | | (884,950) | | | 3,535,068 | | | 4,838,549 | | | (718,750) | | | 4,119,799 | | | Trade names and other | | 11 years | | 568,811 | | | (163,990) | | | 404,821 | | | 609,050 | | | (140,041) | | | 469,009 | | | Total other intangible assets | | | | $ | 5,656,914 | | | $ | (1,048,940) | | | $ | 4,607,974 | | | $ | 6,115,718 | | | $ | (858,791) | | | $ | 5,256,927 | | The decreases in the gross amounts of finite-lived intangible assets since September 30, 2021 were primarily due to foreign currency translation.Amortization expense for finite-lived intangible assets was $74.9 million and $44.8 million in the three months ended June 30, 2022 and 2021, respectively. Amortization expense for finite-lived intangible assets was $234.1 million and $95.9 million in the nine months ended June 30, 2022 and 2021, respectively. Amortization expense for finite-lived intangible assets is estimated to be $306.6 million in fiscal 2022, $288.5 million in fiscal 2023, $287.2 million in fiscal 2024, $286.2 million in fiscal 2025, $282.0 million in fiscal 2026, and $2,723.5 million thereafter. 13

string

Change in awards based on performance (in shares)

20,356

SEC-NUM

[Table of](#ia143979d54ef4089bc700f871e6b0e92_7) [Contents](#ia143979d54ef4089bc700f871e6b0e92_7) | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | 2009 Planshares | | Weighted averageexercise priceper share | | Options Outstanding at December 31, 2021 | | 299,149 | | | $ | 178.71 | | | Granted (1) | | 9,793 | | | 236.14 | | | Exercised | | (4,304) | | | 141.41 | | | Forfeited | | (4,015) | | | 180.32 | | | Options Outstanding at June 30, 2022 | | 300,623 | | | $ | 181.09 | | | Options Exercisable at June 30, 2022 | | 7,058 | | | $ | 135.62 | | \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(1)Grants are from recipient elections to receive a portion of earned restricted stock awards in the form of stock options. Performance Awards: | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Performance awards | | Weighted average grant date fair value per award (1) | | Outstanding at December 31, 2021 | | 284,522 | | | $ | 214.73 | | | Granted (2) | | 72,369 | | | 255.01 | | | Change in awards based on performance (3) | | (20,356) | | | 200.92 | | | Converted to shares of common stock | | (54,053) | | | 217.33 | | | Forfeited | | (1,295) | | | 226.73 | | | Outstanding at June 30, 2022 | | 281,187 | | | $ | 225.54 | | \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(1)Weighted average grant date fair value per award includes the impact of post grant modifications.(2)The shares of common stock that may be earned is based on the total shareholder return metrics for the Company's common stock for 39,744 performance awards and financial metrics related to operating performance and leverage metrics of the Company for 32,625 performance awards.(3)Represents the change in the number of performance awards earned based on performance achievement. The Company used a Monte Carlo model to assess the compensation cost associated with the portion of the performance awards granted for which achievement will be determined by using total shareholder return measures. For the awards granted in 2022, the assumptions used are as follows: | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | 2022 | | Dividend yield | | 2.7% | | Estimated volatility over the life of the plan (1) | | 16.1% - 36.8% | | Risk free rate | | 0.72% - 1.68% | | Estimated performance award value based on total shareholder return measure | | $271.98 | \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(1)Estimated volatility over the life of the plan is using 50% historical volatility and 50% implied volatility. For the portion of the performance awards granted in 2022 for which achievement will be determined by using financial metrics, the compensation cost was based on a weighted average grant date value of $234.15, and the Company's estimate of corporate achievement for the financial metrics. 20

string

Deferred Revenue Adjustment

14

SEC-NUM

electric grid. The Company recognized goodwill of $967 (none of which is expected to be tax deductible), identifiable intangible assets of $783, primarily intellectual property and customer relationships with a weighted-average useful life of approximately 11 years, and deferred tax liabilities of $193. Results of operations for the year ended September 30, 2021 included first year pretax acquisition accounting charges related to backlog amortization and deferred revenue of $30 and $14, respectively, and fees of $6. In 2020, the Company acquired three businesses, two in the Automation Solutions segment and one in the Climate Technologies segment, for $126, net of cash acquired. These three businesses had combined annual sales of approximately $50. The Company acquired eight businesses in 2019, all in the Automation Solutions segment, for $469, net of cash acquired. These eight businesses had combined annual sales of approximately $300. The Company recognized goodwill of $209 ($155 of which is expected to be tax deductible) and other identifiable intangible assets of $158, primarily customer relationships and intellectual property with a weighted-average useful life of approximately nine years. As previously disclosed, the Company sold its network power systems business (rebranded as Vertiv, now a publicly traded company, symbol VRT) in 2017 and retained a subordinated interest contingent upon the equity holders first receiving a threshold return on their initial investment. Subsequent to September 30, 2021, the equity holders received a return on their investment in excess of the threshold. Based on the terms of the agreement and the current calculation, the Company could receive approximately $600 on a pretax basis through periodic distributions over the next two years, of which $438 was received in November 2021. However, the remaining distributions are contingent on the timing and price at which Vertiv shares are sold by the equity holders and therefore, there can be no assurance as to the amount or timing of the remaining distributions to the Company. As of September 30, 2021, no amounts have been recognized in the financial statements related to this gain contingency. (5) OTHER DEDUCTIONS, NET | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | Other deductions, net are summarized below: | | | | | | | | 2019 | | | 2020 | | | 2021 | | | Amortization of intangibles (intellectual property and customer relationships) | $ | 238 | | | 239 | | | 300 | | | Restructuring costs | 95 | | | 284 | | | 150 | | | Other | (8) | | | 9 | | | (132) | | | Total | $ | 325 | | | 532 | | | 318 | | The increase in intangibles amortization expense for 2021 was due to the OSI acquisition, including backlog amortization of $30. Other is composed of several items, including acquisition/divestiture costs, foreign currency transaction gains and losses, litigation, pension expense and other items. The change in 2021 was primarily due to a favorable impact from pensions and investment-related gains, including gains in the first quarter of fiscal 2021 of $21 from an investment sale and $17 from the acquisition of full ownership of an equity investment, and a gain in the second quarter of $31 from the sale of an equity investment. The change in 2020 was primarily due to special advisory fees of $13. (6) RESTRUCTURING COSTSEach year the Company incurs costs to size its businesses to levels appropriate for current economic conditions and to continually improve its cost structure and operational efficiency, deploy assets globally, and remain competitive on a worldwide basis. Costs result from numerous individual actions implemented across the Company's various operating units on an ongoing basis and can include costs for moving facilities to best-cost locations, restarting plants after relocation or geographic expansion to better serve local markets, reducing forcecount or the number of facilities, exiting certain product lines, and other costs resulting from asset deployment decisions (such as contract termination costs, asset write-downs and vacant facility costs). Restructuring expenses were $150, $284 and $95 for 2021, 2020 and 2019, respectively. The Company expects fiscal year 2022 restructuring expense to be approximately $150.41

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Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net

5

SEC-NUM

[Table of Contents](#ib75a44f638b042a5a7472d3f3be80b22_7)The preliminary purchase price allocation was as follows: | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | In millions | | | | Cash and cash equivalents | | $ | 18 | | | Accounts and notes receivable, net | | 24 | | | Inventories | | 15 | | | Property, plant and equipment | | 70 | | | Intangible assets | | 164 | | | | | | | | | | | | | | | Goodwill | | 108 | | | Accounts payable (principally trade) | | (21) | | | Net deferred taxes | | (27) | | | Other, net | | (5) | | | Total purchase price | | $ | 346 | | | | | | The estimated fair values (all considered Level 3 measurements) of the identifiable intangible assets acquired, their weighted-average useful lives, the related valuation methodology and key assumptions are as follows: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Fair Value (in millions) | | Weighted-Average Useful Life (in years) | | Valuation Methodology | | Key Assumptions | | | | | | | Customer relationships | | $ | 108 | | | 9 | | Multi-period excess earnings | | Rate of return, renewal rates | | | | | | | | | | | Technology | | 31 | | | 7 | | Relief-from-royalty | | Royalty rate, rate of return, obsolescence factor | | | | | | | | | | | Trade name | | 25 | | | 14 | | Relief-from-royalty | | Royalty rate, rate of return | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Annual amortization of the intangible assets for the next five years is expected to approximate $18 million per year.Goodwill was determined based on the residual difference between the fair value of consideration transferred and the value assigned to tangible and intangible assets and liabilities. Approximately $9 million of the goodwill is deductible for tax purposes. Among the factors contributing to a purchase price resulting in the recognition of goodwill are Jacob’s expected future customers, new versions of technologies, an acquired workforce and other economic benefits that are anticipated to arise from future product sales and operational synergies from combining the business with Cummins.Included in our results for the three and nine months ended September 30, 2022, were revenues of $43 million and $80 million, respectively, and loss of $2 million and break-even, respectively, related to this business. The results of this business were reported in our Components segment. Pro forma financial information for the acquisition was not presented as the effects are not material to our Condensed Consolidated Financial Statements.Cummins Westport Joint VentureOn February 7, 2022, we purchased Westport Fuel System Inc.'s stake in the Cummins Westport Joint Venture. We will continue to operate the business as the sole owner. The purchase price was $42 million and was allocated primarily to cash, warranty and deferred revenue related to extended coverage contracts. The results of the business were reported in our Engine segment. Pro forma financial information for the acquisition was not presented as the effects are not material to our Condensed Consolidated Financial Statements.Pending AcquisitionPrior to our acquisition of Meritor, Meritor signed an agreement with Siemens to purchase its Commercial Vehicles business for approximately €190 million, subject to working capital and other customary adjustments. This business develops, designs and produces electric drive systems including electric motors, inverters, software and related services for the transit, off-highway and specialty markets. We expect the acquisition to close in the fourth quarter of 2022. This acquisition will be included in our New Power segment.28

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Proceeds from borrowings under secured revolving credit facility

122

SEC-NUM

[Table of Contents](#if58bf2b7da5f49b78db442640b215d13_7) | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | INTUIT INC.CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) | | | | | | | | Nine Months Ended | | (In millions) | April 30,2022 | | April 30,2021 | | Cash flows from operating activities: | | | | | Net income | $ | 2,122 | | | $ | 1,682 | | | Adjustments to reconcile net income to net cash provided by operating activities: | | | | | Depreciation | 142 | | | 122 | | | Amortization of acquired intangible assets | 396 | | | 128 | | | Non-cash operating lease cost | 62 | | | 45 | | | | | | | | Share-based compensation expense | 962 | | | 509 | | | | | | | | Deferred income taxes | 106 | | | 69 | | | | | | | | | | | | | Other | (21) | | | (49) | | | Total adjustments | 1,647 | | | 824 | | | Originations of loans held for sale | — | | | (41) | | | Sale and principal payments of loans held for sale | — | | | 144 | | | Changes in operating assets and liabilities: | | | | | Accounts receivable | (323) | | | (267) | | | Income taxes receivable | 117 | | | 68 | | | Prepaid expenses and other assets | (88) | | | (7) | | | Accounts payable | 86 | | | 194 | | | Accrued compensation and related liabilities | (392) | | | (122) | | | Deferred revenue | (2) | | | (13) | | | Income taxes payable | 195 | | | 206 | | | Operating lease liabilities | (62) | | | (45) | | | Other liabilities | 250 | | | 85 | | | Total changes in operating assets and liabilities | (219) | | | 99 | | | Net cash provided by operating activities | 3,550 | | | 2,708 | | | Cash flows from investing activities: | | | | | Purchases of corporate and customer fund investments | (583) | | | (904) | | | Sales of corporate and customer fund investments | 1,448 | | | 152 | | | Maturities of corporate and customer fund investments | 177 | | | 401 | | | Purchases of property and equipment | (168) | | | (101) | | | Acquisitions of businesses, net of cash acquired | (5,682) | | | (3,064) | | | | | | | | Originations of term loans to small businesses | (613) | | | (135) | | | Principal repayments of term loans from small businesses | 320 | | | 86 | | | Other | (9) | | | 37 | | | Net cash used in investing activities | (5,110) | | | (3,528) | | | Cash flows from financing activities: | | | | | Proceeds from issuance of long-term debt | 4,700 | | | — | | | Repayments on borrowings under unsecured revolving credit facility | — | | | (1,000) | | | Proceeds from borrowings under secured revolving credit facility | 122 | | | — | | | Repayment of debt | — | | | (338) | | | Proceeds from issuance of stock under employee stock plans | 116 | | | 137 | | | Payments for employee taxes withheld upon vesting of restricted stock units | (465) | | | (245) | | | Cash paid for purchases of treasury stock | (1,337) | | | (542) | | | Dividends and dividend rights paid | (580) | | | (482) | | | Net change in customer fund deposits | 82 | | | (107) | | | Other | (9) | | | (2) | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | Intuit Q3 Fiscal 2022 Form 10-Q | 9 | |

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Litigation Settlement, Amount Awarded from Other Party

6

SEC-NUM

28 | Notes to Condensed Consolidated Financial Statements—(Continued) | September 30, 2022 and 2021In August 2020, AES Andes reached an agreement with Minera Escondida and Minera Spence to early terminate two PPAs of the Angamos coal-fired plant in Chile, further accelerating AES Andes' decarbonization strategy. As a result of the termination payment, Angamos recognized a contract liability of $655 million, of which $55 million was derecognized each month through the end of the remaining performance obligation in August 2021.A significant financing arrangement exists for our Mong Duong plant in Vietnam. The plant was constructed under a build, operate, and transfer contract and will be transferred to the Vietnamese government after the completion of a 25 year PPA. The performance obligation to construct the facility was substantially completed in 2015. Contract consideration related to the construction, but not yet collected through the 25 year PPA, was reflected on the Condensed Consolidated Balance Sheet. As of September 30, 2022 and December 31, 2021, Mong Duong met the held-for-sale criteria and the loan receivable balance of approximately $1.2 billion net of CECL reserve of $29 million and $30 million, respectively, was classified as held-for-sale assets. Of the loan receivable balance, $96 million and $91 million was classified as Current held-for-sale assets, respectively, and $1.1 billion was classified as Noncurrent held-for-sale assets.Remaining Performance Obligations — The transaction price allocated to remaining performance obligations represents future consideration for unsatisfied (or partially unsatisfied) performance obligations at the end of the reporting period. As of September 30, 2022, the aggregate amount of transaction price allocated to remaining performance obligations was $10 million, primarily consisting of fixed consideration for the sale of renewable energy credits (“RECs”) in long-term contracts in the U.S. We expect to recognize revenue on approximately one-fifth of the remaining performance obligations in 2022 and 2023, with the remainder recognized thereafter. 14. OTHER INCOME AND EXPENSEOther income generally includes gains on insurance recoveries in excess of property damage, gains on asset sales and liability extinguishments, favorable judgments on contingencies, allowance for funds used during construction, and other income from miscellaneous transactions. Other expense generally includes losses on asset sales and dispositions, losses on legal contingencies, defined benefit plan non-service costs, and losses from other miscellaneous transactions. The components are summarized as follows (in millions): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended September 30, | | Nine Months Ended September 30, | | | | 2022 | | 2021 | | 2022 | | 2021 | | Other Income | Gain on remeasurement of investment (1) | $ | — | | | $ | — | | | $ | 26 | | | $ | — | | | | Insurance proceeds (2) | — | | | — | | | 16 | | | — | | | | AFUDC (US Utilities) | 4 | | | 2 | | | 9 | | | 6 | | | | Legal settlements | — | | | — | | | 6 | | | — | | | | | | | | | | | | | | Gain on acquired customer contracts | — | | | — | | | 5 | | | — | | | | Gain on remeasurement of contingent consideration (3) | — | | | 32 | | | 3 | | | 32 | | | | Gain on remeasurement to acquisition-date fair value (4) | — | | | 8 | | | — | | | 220 | | | | Other | — | | | 6 | | | 15 | | | 16 | | | | Total other income | $ | 4 | | | $ | 48 | | | $ | 80 | | | $ | 274 | | | | | | | | | | | | | Other Expense | Allowance for lease receivable (5) | $ | — | | | $ | — | | | $ | 20 | | | $ | — | | | | Loss on sale and disposal of assets | — | | | 6 | | | 9 | | | 13 | | | | | | | | | | | | | | | | | | | | | | | | Loss on commencement of sales-type leases (6) | — | | | — | | | — | | | 13 | | | | Legal contingencies and settlements | 8 | | | 2 | | | 8 | | | 2 | | | | | | | | | | | | | | Other | 2 | | | 4 | | | 14 | | | 4 | | | | Total other expense | $ | 10 | | | $ | 12 | | | $ | 51 | | | $ | 32 | | \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(1) Related to the remeasurement of our existing investment in 5B, accounted for using the measurement alternative.(2) Primarily related to insurance recoveries associated with property damage at TermoAndes. (3) Related to the remeasurement of contingent consideration on the Great Cove Solar acquisition at AES Clean Energy. See Note 18—Acquisitions for further information.(4) For the three months ended September 30, 2021, primarily related to the $6 million remeasurement of our existing equity interest in Gas Natural Atlántico II, S. de. R.L.’s assets to their acquisition-date fair value. See Note 6—Investments in and Advances to Affiliates for further information. For the nine months ended September 30, 2021, primarily related to the $214 million remeasurement of our existing equity interest in sPower’s development platform as part of the step acquisition to form AES Clean Energy Development. See Note 18—Acquisitions for further information.(5) Related to a full allowance recognized on a sales-type lease receivable at AES Gilbert due to a fire incident in April 2022.(6) Related to a loss recognized at commencement of a sales-type lease at AES Renewable Holdings. See Note 9—Leases for further information.

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Estimated volatility over the life of the plan, minimum (as a percent)

16.1

SEC-NUM

[Table of](#ia143979d54ef4089bc700f871e6b0e92_7) [Contents](#ia143979d54ef4089bc700f871e6b0e92_7) | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | 2009 Planshares | | Weighted averageexercise priceper share | | Options Outstanding at December 31, 2021 | | 299,149 | | | $ | 178.71 | | | Granted (1) | | 9,793 | | | 236.14 | | | Exercised | | (4,304) | | | 141.41 | | | Forfeited | | (4,015) | | | 180.32 | | | Options Outstanding at June 30, 2022 | | 300,623 | | | $ | 181.09 | | | Options Exercisable at June 30, 2022 | | 7,058 | | | $ | 135.62 | | \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(1)Grants are from recipient elections to receive a portion of earned restricted stock awards in the form of stock options. Performance Awards: | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Performance awards | | Weighted average grant date fair value per award (1) | | Outstanding at December 31, 2021 | | 284,522 | | | $ | 214.73 | | | Granted (2) | | 72,369 | | | 255.01 | | | Change in awards based on performance (3) | | (20,356) | | | 200.92 | | | Converted to shares of common stock | | (54,053) | | | 217.33 | | | Forfeited | | (1,295) | | | 226.73 | | | Outstanding at June 30, 2022 | | 281,187 | | | $ | 225.54 | | \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(1)Weighted average grant date fair value per award includes the impact of post grant modifications.(2)The shares of common stock that may be earned is based on the total shareholder return metrics for the Company's common stock for 39,744 performance awards and financial metrics related to operating performance and leverage metrics of the Company for 32,625 performance awards.(3)Represents the change in the number of performance awards earned based on performance achievement. The Company used a Monte Carlo model to assess the compensation cost associated with the portion of the performance awards granted for which achievement will be determined by using total shareholder return measures. For the awards granted in 2022, the assumptions used are as follows: | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | 2022 | | Dividend yield | | 2.7% | | Estimated volatility over the life of the plan (1) | | 16.1% - 36.8% | | Risk free rate | | 0.72% - 1.68% | | Estimated performance award value based on total shareholder return measure | | $271.98 | \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(1)Estimated volatility over the life of the plan is using 50% historical volatility and 50% implied volatility. For the portion of the performance awards granted in 2022 for which achievement will be determined by using financial metrics, the compensation cost was based on a weighted average grant date value of $234.15, and the Company's estimate of corporate achievement for the financial metrics. 20

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Number of share held as investment under 401(k) Plan

1.1

SEC-NUM

[Table of Contents](#i36695dc5143241f795c32e47bf5f4b3d_7)CBRE GROUP, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)A summary of the status of our non-vested stock awards is presented in the table below: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | Shares/Units | | Weighted AverageMarket ValuePer Share | | Balance at December 31, 2018 | 7,182,360 | | | $ | 41.04 | | | Granted | 2,000,977 | | | 50.07 | | | Performance award achievement adjustments | 166,007 | | | 37.36 | | | Vested | (1,323,351) | | | 37.43 | | | Forfeited | (316,294) | | | 42.09 | | | Balance at December 31, 2019 | 7,709,699 | | | 43.89 | | | Granted | 1,605,934 | | | 56.45 | | | Performance award achievement adjustments | 560,563 | | | 39.89 | | | Vested | (2,780,377) | | | 39.81 | | | Forfeited | (412,407) | | | 48.27 | | | Balance at December 31, 2020 | 6,683,412 | | | 47.99 | | | Granted | 2,531,959 | | | 92.16 | | | Performance award achievement adjustments | (189,930) | | | 49.76 | | | Vested | (1,883,652) | | | 46.34 | | | Forfeited | (292,998) | | | 55.80 | | | Balance at December 31, 2021 | 6,848,791 | | | 64.10 | | Total compensation expense related to non-vested stock awards was $184.9 million, $60.4 million and $127.7 million for the years ended December 31, 2021, 2020 and 2019, respectively. At December 31, 2021, total unrecognized estimated compensation cost related to non-vested stock awards was approximately $269.4 million, which is expected to be recognized over a weighted average period of approximately 3.2 years.BonusesWe have bonus programs covering select employees, including senior management. Awards are based on the position and performance of the employee and the achievement of pre-established financial, operating and strategic objectives. The amounts charged to expense for bonuses were $871.7 million, $557.6 million and $554.6 million for the years ended December 31, 2021, 2020 and 2019, respectively.401(k) PlanOur CBRE 401(k) Plan (401(k) Plan) is a defined contribution savings plan that allows participant deferrals under Section 401(k) of the Internal Revenue Code (IRC). Most of our U.S. employees, other than qualified real estate agents having the status of independent contractors under section 3508 of the IRC of 1986, as amended, and non-plan electing union employees, are eligible to participate in the plan. The 401(k) Plan provides for participant contributions as well as a company match. A participant is allowed to contribute to the 401(k) Plan from 1% to 75% of his or her compensation, subject to limits imposed by applicable law. Effective January 1, 2007, all participants hired post January 1, 2007 vest in company match contributions 20% per year for each plan year they are employed. All participants hired before January 1, 2007 are immediately vested in company match contributions. Effective October 1, 2021, all active participants vest in company match contributions at 33% per year for each plan year they are employed. For 2021, 2020 and 2019, we contributed a 67% match on the first 6% of annual compensation for participants with an annual base salary of less than $100,000 and we contributed a 50% match on the first 6% of annual compensation for participants with an annual base salary of $100,000 or more, or who are commissioned employees (up to $150,000 of compensation). Effective January 1, 2022, we will contribute 67% on the first 6% of eligible compensation contributed to the plan (up to $150,000 of eligible pay) for all employees regardless of base compensation or commissioned status. In connection with the 401(k) Plan, we charged to expense $72.4 million, $83.5 million and $59.9 million for the years ended December 31, 2021, 2020 and 2019, respectively.Participants are entitled to invest up to 25% of their 401(k) account balance in shares of our common stock. As of December 31, 2021, approximately 1.1 million shares of our common stock were held as investments by participants in our 401(k) Plan.103

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Contingent value right, monthly reduction (in cents per share)

8.3

SEC-NUM

The following table summarizes revenue by geographical area: | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended June 30, | | Six Months Ended June 30, | | | 2022 | | 2021 | | 2022 | | 2021 | | Revenue—to unaffiliated customers(1): | | | | | | | | | U.S. | $ | 3,934.8 | | | $ | 3,704.2 | | | $ | 9,109.4 | | | $ | 7,645.5 | | | Europe | 1,101.1 | | | 1,209.8 | | | 2,168.4 | | | 2,531.0 | | | Japan | 454.4 | | | 665.4 | | | 864.6 | | | 1,237.2 | | | China | 352.1 | | | 522.5 | | | 758.5 | | | 884.7 | | | Other foreign countries | 645.7 | | | 638.1 | | | 1,397.2 | | | 1,247.3 | | | Revenue | $ | 6,488.0 | | | $ | 6,740.1 | | | $ | 14,298.0 | | | $ | 13,545.7 | | Numbers may not add due to rounding.(1) Revenue is attributed to the countries based on the location of the customer. Note 3: AcquisitionsWe engage in various forms of business development activities to enhance our product pipeline, including acquisitions, collaborations, investments, and licensing arrangements. In connection with these arrangements, our partners may be entitled to future royalties and/or commercial milestones based on sales should products be approved for commercialization and/or milestones based on the successful progress of compounds through the development process.In January 2021, we completed the acquisition of Prevail Therapeutics Inc. (Prevail). This transaction, as further discussed below in Acquisition of a Business, was accounted for as a business combination under the acquisition method of accounting. Under this method, the assets acquired and liabilities assumed were recorded at their respective fair values as of the acquisition date in our consolidated condensed financial statements. The determination of estimated fair value required management to make significant estimates and assumptions. The excess of the purchase price over the fair value of the acquired net assets, where applicable, has been recorded as goodwill. The results of operations of this acquisition is included in our consolidated condensed financial statements from the date of acquisition.We also acquired assets in development which are further discussed below in Asset Acquisitions. Upon each acquisition, the cost allocated to acquired IPR&D is immediately expensed if the compound has no alternative future use. Milestone payment obligations incurred prior to regulatory approval of the compound are expensed when the event triggering an obligation to pay the milestone occurs. We recognized acquired IPR&D and development milestone charges of $440.4 million and $606.0 million for the three and six months ended June 30, 2022, respectively, and $42.8 million and $354.8 million for the three and six months ended June 30, 2021, respectively. Acquisition of a BusinessPrevail AcquisitionOverview of TransactionIn January 2021, we acquired all shares of Prevail for a purchase price that included $22.50 per share in cash (or an aggregate of $747.4 million, net of cash acquired) plus one non-tradable contingent value right (CVR) per share. The CVR entitles Prevail stockholders up to an additional $4.00 per share in cash (or an aggregate of approximately $160 million) payable, subject to certain terms and conditions, upon the first regulatory approval of a Prevail product in one of the following countries: U.S., Japan, United Kingdom, Germany, France, Italy or Spain. To achieve the full value of the CVR, such regulatory approval must occur by December 31, 2024. If such regulatory approval occurs after December 31, 2024, the value of the CVR will be reduced by approximately 8.3 cents per month until December 1, 2028, at which point the CVR will expire without payment.Under the terms of the agreement, we acquired potentially disease-modifying AAV9-based gene therapies for patients with neurodegenerative diseases. The acquisition established a new modality for drug discovery and development, extending our research efforts through the creation of a gene therapy program that is being anchored by Prevail's portfolio of assets. The lead gene therapies in clinical development that we acquired were PR001 for patients with Parkinson's disease with GBA1 mutations and neuronopathic Gaucher disease and PR006 for patients with frontotemporal dementia with GRN mutations. Both PR001 and PR006 were granted Fast Track designation from the U.S. Food and Drug Administration (FDA). 15

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Purchase of non-controlling interest reclassified to APIC

8.2

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[Table of Contents](#ic085909a172f44ef92ae922b1099b569_7)Hologic, Inc.Consolidated Statements of Stockholders' Equity(In millions, except number of shares, which are reflected in thousands) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Common Stock | | AdditionalPaid-in-Capital | | RetainedEarnings / (Accumulated Deficit) | | AccumulatedOtherComprehensiveLoss | | Treasury Stock | | | | TotalStockholders’Equity | | | | Number ofShares | | Par Value | | Number ofShares | | Amount | | Noncontrolling Interest | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Balance at September 26, 2020 | | 295,107 | | | $ | 2.9 | | | $ | 5,904.8 | | | $ | (1,573.2) | | | $ | (49.7) | | | 37,609 | | | $ | (1,579.6) | | | $ | 2.1 | | | $ | 2,707.3 | | | Exercise of stock options | | 490 | | | — | | | 18.4 | | | — | | | — | | | — | | | — | | | — | | | 18.4 | | | Vesting of restricted stock units, net | | 936 | | | 0.1 | | | (46.5) | | | — | | | — | | | — | | | — | | | — | | | (46.4) | | | | | | | | | | | | | | | | | | | | | | | Stock-based compensation | | — | | | — | | | 18.6 | | | — | | | — | | | — | | | — | | | — | | | 18.6 | | | Net income (loss) | | — | | | — | | | — | | | 654.4 | | | — | | | — | | | — | | | (1.0) | | | 653.4 | | | Other comprehensive income activity | | — | | | — | | | — | | | — | | | 19.0 | | | — | | | — | | | — | | | 19.0 | | | Repurchase of common stock | | — | | | — | | | — | | | — | | | — | | | 1,469 | | | (101.3) | | | — | | | (101.3) | | | Balance at December 26, 2020 | | 296,533 | | | $ | 3.0 | | | $ | 5,895.3 | | | $ | (918.8) | | | $ | (30.7) | | | 39,078 | | | $ | (1,680.9) | | | $ | 1.1 | | | $ | 3,269.0 | | | Exercise of stock options | | 146 | | | — | | | 5.8 | | | — | | | — | | | — | | | — | | | — | | | 5.8 | | | Vesting of restricted stock units, net | | 17 | | | — | | | (0.3) | | | — | | | — | | | — | | | — | | | — | | | (0.3) | | | Common stock issued under the employee stock purchase plan | | 191 | | | — | | | 9.2 | | | — | | | — | | | — | | | — | | | — | | | 9.2 | | | Stock-based compensation | | — | | | — | | | 17.1 | | | — | | | — | | | — | | | — | | | — | | | 17.1 | | | Net income (loss) | | — | | | — | | | — | | | 619.9 | | | — | | | — | | | — | | | (0.5) | | | 619.4 | | | Other comprehensive income activity | | — | | | — | | | — | | | — | | | (5.1) | | | — | | | — | | | — | | | (5.1) | | | Repurchase of common stock | | — | | | — | | | — | | | — | | | — | | | 1,604 | | | (120.1) | | | — | | | (120.1) | | | Balance at March 27, 2021 | | 296,887 | | | $ | 3.0 | | | $ | 5,927.1 | | | $ | (298.9) | | | $ | (35.8) | | | 40,682 | | | $ | (1,801.0) | | | $ | 0.6 | | | $ | 3,795.0 | | | Exercise of stock options | | 53 | | | — | | | 2.1 | | | — | | | — | | | — | | | — | | | — | | | 2.1 | | | Vesting of restricted stock units, net | | 5 | | | — | | | (0.2) | | | — | | | — | | | — | | | — | | | — | | | (0.2) | | | | | | | | | | | | | | | | | | | | | | | Stock-based compensation | | — | | | — | | | 15.4 | | | — | | | — | | | — | | | — | | | — | | | 15.4 | | | Net income (loss) | | — | | | — | | | — | | | 268.4 | | | — | | | — | | | — | | | (0.3) | | | 268.1 | | | Other comprehensive income activity | | — | | | — | | | — | | | — | | | (6.4) | | | — | | | — | | | — | | | (6.4) | | | Repurchase of common stock | | — | | | — | | | — | | | — | | | — | | | 2,971 | | | (188.4) | | | — | | | (188.4) | | | Purchase of non-controlling interest | | — | | | — | | | (8.2) | | | — | | | — | | | — | | | — | | | (0.3) | | | (8.5) | | | Balance at June 26, 2021 | | 296,945 | | | $ | 3.0 | | | $ | 5,936.2 | | | $ | (30.5) | | | $ | (42.2) | | | 43,653 | | | $ | (1,989.4) | | | $ | — | | | $ | 3,877.1 | | | Exercise of stock options | | 168 | | | — | | | 6.6 | | | — | | | — | | | — | | | — | | | — | | | 6.6 | | | Vesting of restricted stock units, net | | 22 | | | — | | | (0.6) | | | — | | | — | | | — | | | — | | | — | | | (0.6) | | | Common stock issued under the employee stock purchase plan | | 171 | | | — | | | 9.7 | | | — | | | — | | | — | | | — | | | — | | | 9.7 | | 6

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Maximum exposure to credit risk in the event of non performance by counterparties, gross fair value of contracts in asset positions

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[Table of Contents](#i2ba0bd92bcb14d27a1d59d9667569d45_7)THE ESTÉE LAUDER COMPANIES INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTSCash Flow HedgesThe Company enters into foreign currency forward contracts, and may enter into foreign currency option contracts, to hedge anticipated transactions and receivables and payables denominated in foreign currencies, for periods consistent with the Company’s identified exposures. The purpose of the hedging activities is to minimize the effect of foreign exchange rate movements on the cash flows that the Company receives from foreign subsidiaries. The foreign currency forward contracts entered into to hedge anticipated transactions have been designated as cash flow hedges and have varying maturities through the end of March 2024. Hedge effectiveness of the foreign currency forward contracts is based on the forward method, which includes time value in the effectiveness assessment. At June 30, 2022, the Company had cash flow hedges outstanding with a notional amount totaling $1,405 million.The Company may enter into interest rate forward contracts to hedge anticipated issuance of debt for periods consistent with the Company’s identified exposures. The purpose of the hedging activities is to minimize the effect of interest rate movements on the cost of debt issuance.For hedge contracts that are no longer deemed highly effective, hedge accounting is discontinued and gains and losses in AOCI are reclassified to sales when the underlying forecasted transaction occurs. If it is probable that the forecasted transaction will no longer occur, then any gains or losses in AOCI are reclassified to current-period sales. As of June 30, 2022, the Company’s foreign currency cash flow hedges were highly effective.The estimated net gain on the Company’s derivative instruments designated as cash flow hedges as of June 30, 2022 that is expected to be reclassified from AOCI into earnings, net of tax, within the next twelve months is $36 million. The accumulated net gain (loss) on derivative instruments in AOCI was $90 million and $(1) million as of June 30, 2022 and 2021, respectively. Fair Value Hedges The Company enters into interest rate derivative contracts to manage the exposure to interest rate fluctuations on its funded indebtedness. The Company has interest rate swap agreements, with notional amounts totaling $250 million, $700 million and $300 million to effectively convert the fixed rate interest on its 2022 Senior Notes, 2030 Senior Notes and 2031 Senior Notes, respectively, to variable interest rates based on three-month LIBOR plus a margin. These interest rate swap agreements are designated as fair value hedges of the related long-term debt, and the changes in the fair value of the interest rate swap agreements are exactly offset by the change in the fair value of the underlying long-term debt. Net Investment Hedges The Company enters into foreign currency forward contracts, designated as net investment hedges, to hedge a portion of its net investment in certain foreign operations. The net gain or loss on these contracts is recorded within translation adjustments, as a component of AOCI on the Company’s consolidated balance sheets. The purpose of the hedging activities is to minimize the effect of foreign exchange rate movements on the Company’s net investment in these foreign operations. The net investment hedge contracts have varying maturities through the end of July 2022. Hedge effectiveness of the net investment hedge contracts is based on the spot method. At June 30, 2022, the Company had net investment hedges outstanding with a notional amount totaling $1,372 million. Credit RiskAs a matter of policy, the Company enters into derivative contracts only with counterparties that have a long-term credit rating of at least A- or higher by at least two nationally recognized rating agencies. The counterparties to these contracts are major financial institutions. Exposure to credit risk in the event of nonperformance by any of the counterparties is limited to the gross fair value of contracts in asset positions, which totaled $215 million at June 30, 2022. To manage this risk, the Company has strict counterparty credit guidelines that are continually monitored. Accordingly, management believes risk of loss under these hedging contracts is remote. F-49

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Debt instrument, discount percentage

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exposure on the portion of the 2021 Senior Notes that were redeemed in September 2019. The $2.6 million loss was reclassified out of accumulated other comprehensive income and recorded through interest expense. In connection with the issuance of the 2030 Senior Notes, the Company recognized $3.0 million of interest expense related to premiums paid for a series of derivative transactions that were entered into in July 2019 to hedge the related interest rate risk. In March 2018, the Company issued the following three series of senior notes with an aggregate principal amount of $900.0 million:•2021 Senior Notes: The first series of senior notes was $300.0 million in principal amount, bore a floating interest rate equal to three-month LIBOR plus 1.25% and was to mature in March 2021. Interest on the 2021 Senior Notes was payable quarterly. Commencing on or after March 2019, the Company could redeem the 2021 Senior Notes at any time in whole or from time to time in part at a redemption price equal to 100% of the principal amount being redeemed plus accrued and unpaid interest. In August 2019, the Company redeemed $250.0 million of the $300.0 million then outstanding aggregate principal amount of the 2021 Senior Notes, plus accrued and unpaid interest to the redemption date. In January 2021, the Company redeemed the remaining $50.0 million outstanding aggregate principal amount of the 2021 Senior Notes, plus accrued and unpaid interest to the redemption date, in advance of the original maturity in March 2021.•2023 Senior Notes: The second series of senior notes is $300.0 million in principal amount, bears interest at 4.20% per year, matures in September 2023 and was issued at a 0.233% discount to the public (the “2023 Senior Notes”). Interest on the 2023 Senior Notes is payable semi-annually. Prior to August 2023, the Company may redeem the 2023 Senior Notes at any time in whole or from time to time in part at a make-whole premium plus accrued and unpaid interest. On or after that date, the Company may redeem the 2023 Senior Notes at any time in whole or from time to time in part at a redemption price equal to 100% of the principal amount being redeemed plus accrued and unpaid interest.•2028 Senior Notes: The third series of senior notes is $300.0 million in principal amount, bears interest at 4.90% per year, matures in March 2028 and was issued at a 0.383% discount to the public (the “2028 Senior Notes”). Interest on the 2028 Senior Notes is payable semi-annually. Prior to December 2027, the Company may redeem the 2028 Senior Notes at any time in whole or from time to time in part at a make-whole premium plus accrued and unpaid interest. On or after that date, the Company may redeem the 2028 Senior Notes at any time in whole or from time to time in part at a redemption price equal to 100% of the principal amount being redeemed plus accrued and unpaid interest.The interest rate payable on each of the 2023 Senior Notes, 2028 Senior Notes, 2030 Senior Notes and 2032 Senior Notes will be subject to adjustment from time to time, if either Moody’s Investor Service, Inc. (“Moody’s”) or S&P Global Ratings, a division of S&P Global Inc. (“S&P”) downgrades the credit rating assigned to such series of senior notes to Ba1 or below or to BB+ or below, respectively, or subsequently upgrades the credit ratings once the senior notes are at or below such levels. The following table details the increase in interest rate over the issuance rate by rating with the impact equal to the sum of the number of basis points next to such rating for a maximum increase of 200 basis points over the issuance rate: | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | Rating Agencies | | | | Rating Levels | | Moody’s (1) | | S&P (1) | | Interest Rate Increase (2) | | 1 | | Ba1 | | BB+ | | 25 basis points | | 2 | | Ba2 | | BB | | 50 basis points | | 3 | | Ba3 | | BB- | | 75 basis points | | 4 | | B1 or below | | B+ or below | | 100 basis points | (1)Including the equivalent ratings of any substitute rating agency. (2)Applies to each rating agency individually. In March 2013, the Company issued two series of senior notes, one of which was repaid at maturity in March 2018. The second series was $350.0 million in aggregate principal amount, was issued at a 0.365% discount to the public, bore interest at 4.00% per year and was to mature in March 2023 (the “2023 Senior Notes”). In July 2021, we used the proceeds from the issuance of the 2032 Senior Notes, along with cash on hand, to redeem all of the $350.0 million outstanding aggregate principal amount of the 2023 Senior Notes. A loss on extinguishment of debt of $20.7 million was reported for the year ended December 31, 2021.In February 2004, the Company issued senior notes with an aggregate principal amount of $475.0 million at a 0.61% discount to the public, which bear interest at 6.75% per year and matures in February 2034. Interest is payable semi-annually. F-60

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Accrued interest paid

5

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The Company incurred capital expenditures which remained unpaid at March 31, 2022 and March 31, 2021 of $29 and $28, respectively, and will result in cash outflows within investing activities in the Statement of Consolidated Cash Flows in subsequent periods.M. LeasesOperating lease cost, which included short-term leases and variable lease payments and approximates cash paid, was $16 and $17 in the first quarter of 2022 and 2021, respectively.Operating lease right-of-use assets and lease liabilities in the Consolidated Balance Sheet were as follows: | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | March 31, 2022 | | December 31, 2021 | | | | Right-of-use assets classified in Other noncurrent assets | $ | 105 | | | $ | 108 | | | | | | | | | | | | Current portion of lease liabilities classified in Other current liabilities | $ | 32 | | | $ | 33 | | | | | Long-term portion of lease liabilities classified in Other noncurrent liabilities | 78 | | | 81 | | | | | Total lease liabilities | $ | 110 | | | $ | 114 | | | | N. Debt | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | March 31, 2022 | | December 31, 2021 | | | | | | | | | | | | | | | | | 5.125% Notes, due 2024 | $ | 1,150 | | | $ | 1,150 | | | 6.875% Notes, due 2025 | 600 | | | 600 | | | 5.900% Notes, due 2027 | 625 | | | 625 | | | 6.750% Bonds, due 2028 | 300 | | | 300 | | | 3.000% Notes, due 2029 | 700 | | | 700 | | | 5.950% Notes, due 2037 | 625 | | | 625 | | | 4.750% Iowa Finance Authority Loan, due 2042 | 250 | | | 250 | | | Other(1) | (19) | | | (18) | | | | 4,231 | | | 4,232 | | | Less: amount due within one year | 3 | | | 5 | | | Total long-term debt | $ | 4,228 | | | $ | 4,227 | | (1)Includes various financing arrangements related to subsidiaries, unamortized debt discounts and unamortized debt issuance costs related to outstanding notes and bonds listed in the table above.Public DebtOn January 15, 2021, the Company completed the early redemption of all the remaining $361 of its 5.400% Notes due 2021 at par and paid $5 in accrued interest.Credit FacilityOn September 28, 2021, the Company amended and restated its Credit Agreement. The Credit Agreement provides a $1,000 senior unsecured revolving credit facility that matures on September 28, 2026, unless extended or earlier terminated in accordance with the provisions of the Credit Agreement. Capitalized terms used in this “Credit Facility” section but not otherwise defined shall have the meanings given to such terms in the Credit Agreement.Under the Credit Agreement, the Company’s ratio of Consolidated Net Debt to Consolidated EBITDA as of the end of each fiscal quarter for the period of the four fiscal quarters of the Company most recently ended, is required to be no greater than 3.50 to 1.00; provided, however, that during the Covenant Relief Period through December 31, 2022 (unless the Company elects to terminate the Covenant Relief Period earlier in accordance with the Credit Agreement), the Company’s Consolidated Net Debt to Consolidated EBITDA ratio cannot exceed the levels set forth below: | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | No greater than | | | | | | | | | | | | | | (i) for the quarter ending March 31, 2022 | 4.50 to 1.00 | | (ii) for the quarter ending June 30, 2022 | 4.50 to 1.00 | | (iii) for the quarter ending September 30, 2022 | 4.25 to 1.00 | | (iv) for the quarter ending December 31, 2022 | 3.75 to 1.00 | | | | 16

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The threshold ownership percentage on Residual value of customers TOBs for which the reimbursement agreement applied

25

SEC-NUM

Citigroup also provides liquidity services to many customer and non-customer trusts. If a trust is unwound early due to an event other than a credit event on the underlying municipal bonds, the underlying municipal bonds are sold out of the trust and bond sale proceeds are used to redeem the outstanding trust certificates. If this results in a shortfall between the bond sale proceeds and the redemption price of the tendered Floaters, the Company, pursuant to the liquidity agreement, would be obligated to make a payment to the trust to satisfy that shortfall. For certain customer TOB trusts, Citigroup has also executed a reimbursement agreement with the holder of the Residual, pursuant to which the Residual holder is obligated to reimburse the Company for any payment the Company makes under the liquidity arrangement. These reimbursement agreements may be subject to daily margining based on changes in the market value of the underlying municipal bonds. In cases where a third party provides liquidity to a non-customer TOB trust, a similar reimbursement arrangement may be executed, whereby the Company (or a consolidated subsidiary of the Company), as Residual holder, would absorb any losses incurred by the liquidity provider.For certain other non-customer TOB trusts, Citi serves as tender option provider. The tender option provider arrangement allows Floater holders to put their interests directly to the Company at any time, subject to the requisite notice period requirements, at a price of par.At December 31, 2021 and 2020, liquidity agreements provided with respect to customer TOB trusts totaled $1.5 billion and $1.6 billion, respectively, of which $0.6 billion and $0.8 billion, respectively, were offset by reimbursement agreements. For the remaining exposure related to TOB transactions, where the residual owned by the customer was at least 25% of the bond value at the inception of the transaction, no reimbursement agreement was executed. Citi considers both customer and non-customer TOB trusts to be VIEs. Customer TOB trusts are not consolidated by the Company, as the power to direct the activities that most significantly impact the trust’s economic performance rests with the customer Residual holder, which may unilaterally cause the sale of the trust’s bonds.Non-customer TOB trusts generally are consolidated because the Company holds the Residual interest and thus has the unilateral power to cause the sale of the trust’s bonds.The Company also provides other liquidity agreements or letters of credit to customer-sponsored municipal investment funds, which are not variable interest entities, and municipality-related issuers that totaled $2 billion as of December 31, 2021 and $3.6 billion as of December 31, 2020. These liquidity agreements and letters of credit are offset by reimbursement agreements with various term-out provisions. Municipal InvestmentsMunicipal investment transactions include debt and equity interests in partnerships that finance the construction and rehabilitation of low-income housing, facilitate lending in new or underserved markets or finance the construction or operation of renewable municipal energy facilities. Citi generally invests in these partnerships as a limited partner and earns a return primarily through the receipt of tax credits and grants earned from the investments made by the partnership. The Company may also provide construction loans or permanent loans for the development or operation of real estate properties held by partnerships. These entities are generally considered VIEs. The power to direct the activities of these entities is typically held by the general partner. Accordingly, these entities are not consolidated by Citigroup. Client IntermediationClient intermediation transactions represent a range of transactions designed to provide investors with specified returns based on the returns of an underlying security, referenced asset or index. These transactions include credit-linked notes and equity-linked notes. In these transactions, the VIE typically obtains exposure to the underlying security, referenced asset or index through a derivative instrument, such as a total-return swap or a credit-default swap. In turn, the VIE issues notes to investors that pay a return based on the specified underlying security, referenced asset or index. The VIE invests the proceeds in a financial asset or a guaranteed insurance contract that serves as collateral for the derivative contract over the term of the transaction. The Company’s involvement in these transactions includes being the counterparty to the VIE’s derivative instruments and investing in a portion of the notes issued by the VIE. In certain transactions, the investor’s maximum risk of loss is limited and the Company absorbs risk of loss above a specified level. Citi does not have the power to direct the activities of the VIEs that most significantly impact their economic performance and thus it does not consolidate them.Citi’s maximum risk of loss in these transactions is defined as the amount invested in notes issued by the VIE and the notional amount of any risk of loss absorbed by Citi through a separate instrument issued by the VIE. The derivative instrument held by the Company may generate a receivable from the VIE (e.g., where the Company purchases credit protection from the VIE in connection with the VIE’s issuance of a credit-linked note), which is collateralized by the assets owned by the VIE. These derivative instruments are not considered variable interests and any associated receivables are not included in the calculation of maximum exposure to the VIE. Investment FundsThe Company is the investment manager for certain investment funds and retirement funds that invest in various asset classes including private equity, hedge funds, real estate, fixed income and infrastructure. Citigroup earns a management fee, which is a percentage of capital under management, and may earn performance fees. In addition, for some of these funds the Company has an ownership interest in the investment funds. Citi has also established a number of investment funds as opportunities for qualified colleagues to invest in private equity investments. The Company acts as investment manager for these funds and may provide colleagues with financing on both recourse and non-recourse bases for a portion of the colleagues’ investment commitments. 245

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Assets held-in-trust

14

SEC-NUM

CAESARS ENTERTAINMENT, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)contributed to, and held in, the trust was $14 million, which is included within Treasury stock. The Company recognized a loss on the change in fair value of the derivative liability of $16 million recorded in Other income (loss) and a $23 million loss on extinguishment of debt, related to the unamortized discount, on the Statement of Operations. CRC NotesOn October 16, 2017, CRC issued $1.7 billion aggregate principal amount of 5.25% senior notes due 2025 (the “CRC Notes”). During the year ended December 31, 2021, the Company purchased or redeemed all $1.7 billion of the CRC Notes and recognized a $199 million loss on the early extinguishment of debt.CEI Senior Notes due 2027On July 6, 2020, the Escrow Issuer issued $1.8 billion in aggregate principal amount of 8.125% Senior Notes due 2027 pursuant to an indenture, dated July 6, 2020 (the “CEI Senior Notes”), by and between the Escrow Issuer and U.S. Bank National Association, as trustee. The Company assumed the rights and obligations under the CEI Senior Notes and the indenture governing such notes on July 20, 2020. The CEI Secured Notes will mature on July 1, 2027 with interest payable semi-annually in cash in arrears on January 1 and July 1 of each year. In September 2021, the Company began to repurchase CEI Senior Notes on the open market and, as of December 31, 2021, a total of $100 million in principal amount of CEI Senior Notes was purchased and the Company recognized a $14 million loss on the early extinguishment of debt.Senior Notes due 2029On September 24, 2021, the Company issued $1.2 billion in aggregate principal amount of 4.625% Senior Notes due 2029 (the “Senior Notes”) pursuant to an indenture dated as of September 24, 2021 between the Company and U.S. Bank National Association, as Trustee. The Senior Notes will mature on October 15, 2029 with interest payable on April 15 and October 15 of each year, commencing April 15, 2022. Proceeds from the issuance of the Senior Notes, as well as cash on hand, was used to repay the CRC Notes, as described above. Net amortization of the debt issuance costs and the discount and/or premium associated with the Company’s indebtedness totaled $177 million, $80 million and $8 million for the years ended December 31, 2021, 2020 and 2019, respectively. Amortization of debt issuance costs is computed using the effective interest method and is included in interest expense. | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | Summary of Debt and Revolving Credit Facility Cash Flows from Financing Activities in 2021 | | (In millions) | Proceeds | | Repayments | | Debt issuance and extinguishment costs | | | | | | | | | | | | | | | | Senior Notes | $ | 1,200 | | | $ | — | | | $ | 17 | | | CRC Notes | — | | | 1,700 | | | 24 | | | CEI Senior Notes | — | | | 100 | | | 13 | | | CRC Term Loan | — | | | 47 | | | — | | | | | | | | | | CRC Incremental Term Loan | 108 | | | 126 | | | 2 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Baltimore Term Loan | — | | | 2 | | | — | | | Special Improvement District Bonds | — | | | 2 | | | — | | | Total | $ | 1,308 | | | $ | 1,977 | | | $ | 56 | | Debt Covenant ComplianceThe CRC Credit Agreement, the CEI Revolving Credit Facility, the Baltimore Term Loan and the indentures governing the CEI Senior Secured Notes, the CEI Senior Notes, the CRC Senior Secured Notes, and the Senior Notes contain covenants which are standard and customary for these types of agreements. These include negative covenants, which, subject to certain exceptions and baskets, limit the Company’s and its subsidiaries’ ability to (among other items) incur additional indebtedness, make investments, make restricted payments, including dividends, grant liens, sell assets and make acquisitions.The CRC Revolving Credit Facility and the CEI Revolving Credit Facility include a maximum first-priority net senior secured leverage ratio financial covenant of 6.35:1, which is applicable solely to the extent that certain testing conditions are satisfied. The Baltimore Revolving Credit Facility includes a senior secured leverage ratio financial covenant of 5.0:1. Failure to comply with such covenants could result in an acceleration of the maturity of indebtedness outstanding under the relevant debt document.As of December 31, 2021, the Company was in compliance with all of the applicable financial covenants described above. [Table of Contents](#i37dfc5eabc12461dbfc5ef573d80947e_7)99

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Finance Lease, Liability, Payment, Due

659

SEC-NUM

FORD MOTOR COMPANY AND SUBSIDIARIESNOTES TO THE FINANCIAL STATEMENTSNOTE 18. LEASE COMMITMENTS (Continued) Lease right-of-use assets and liabilities at December 31 were as follows (in millions): | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | 2020 | | 2021 | | Operating leases | | | | | | Other assets, non-current | | $ | 1,287 | | | $ | 1,337 | | | | | | | | | Other liabilities and deferred revenue, current | | $ | 323 | | | $ | 345 | | | Other liabilities and deferred revenue, non-current | | 991 | | | 1,048 | | | Total operating lease liabilities | | $ | 1,314 | | | $ | 1,393 | | | | | | | | | Finance leases | | | | | | Property and equipment, gross | | $ | 540 | | | $ | 715 | | | Accumulated depreciation | | (50) | | | (68) | | | Property and equipment, net | | $ | 490 | | | $ | 647 | | | | | | | | | Company excluding Ford Credit debt payable within one year | | $ | 46 | | | $ | 76 | | | Company excluding Ford Credit long-term debt | | 368 | | | 489 | | | Total finance lease liabilities | | $ | 414 | | | $ | 565 | | The amounts contractually due on our lease liabilities as of December 31, 2021 were as follows (in millions): | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Operating Leases (a) | | Finance Leases | | 2022 | | $ | 385 | | | $ | 94 | | | 2023 | | 307 | | | 88 | | | 2024 | | 223 | | | 70 | | | 2025 | | 161 | | | 62 | | | 2026 | | 128 | | | 57 | | | Thereafter | | 335 | | | 288 | | | Total | | 1,539 | | | 659 | | | Less: Present value discount | | 146 | | | 94 | | | Total lease liabilities | | $ | 1,393 | | | $ | 565 | | \_\_\_\_\_\_\_\_\_\_(a) Excludes approximately $252 million in future lease payments for various operating leases commencing in a future period.153

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Expected volatility

33.2

SEC-NUM

INVITATION HOMES INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(dollar amounts in thousands) Summary of Total Share-Based AwardsThe following table summarizes activity related to non-vested time-vesting RSUs and PRSUs, other than Outperformance Awards, during the years ended December 31, 2021, 2020, and 2019: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Time-Vesting Awards | | PRSUs | | Total Share-Based Awards(1) | | | | Number | | WeightedAverage GrantDate Fair Value(Actual $) | | Number | | WeightedAverage GrantDate Fair Value(Actual $) | | Number | | WeightedAverage GrantDate Fair Value(Actual $) | | Balance, December 31, 2018 | | 1,595,644 | | | $ | 21.63 | | | 888,733 | | | $ | 22.09 | | | 2,484,377 | | | $ | 21.79 | | | Granted | | 242,224 | | | 23.44 | | | 369,419 | | | 24.27 | | | 611,643 | | | 23.94 | | | Vested(2) | | (1,076,025) | | | (21.46) | | | (83,938) | | | (21.21) | | | (1,159,963) | | | (21.45) | | | Forfeited / canceled | | (76,774) | | | (22.03) | | | (249,138) | | | (21.75) | | | (325,912) | | | (21.81) | | | Balance, December 31, 2019 | | 685,069 | | | 22.48 | | | 925,076 | | | 23.13 | | | 1,610,145 | | | 22.86 | | | Granted | | 225,760 | | | 28.25 | | | 428,114 | | | 29.61 | | | 653,874 | | | 29.14 | | | Vested(2) | | (339,448) | | | (22.81) | | | (353,156) | | | (22.04) | | | (692,604) | | | (22.42) | | | Forfeited / canceled | | (11,258) | | | (25.59) | | | (24,223) | | | (23.56) | | | (35,481) | | | (24.20) | | | Balance, December 31, 2020 | | 560,123 | | | 24.54 | | | 975,811 | | | 26.36 | | | 1,535,934 | | | 25.70 | | | Granted | | 252,249 | | | 30.30 | | | 626,325 | | | 27.44 | | | 878,574 | | | 28.26 | | | Vested(2) | | (396,185) | | | (23.44) | | | (436,493) | | | (23.31) | | | (832,678) | | | (23.37) | | | Forfeited / canceled | | (19,102) | | | (29.83) | | | (68,106) | | | (23.25) | | | (87,208) | | | (24.69) | | | Balance, December 31, 2021 | | 397,085 | | | $ | 29.05 | | | 1,097,537 | | | $ | 28.38 | | | 1,494,622 | | | $ | 28.56 | | | | | | | --- | --- | --- | | | | | | | (1)Total share-based awards excludes Outperformance Awards.(2)All vested share-based awards are included in basic EPS for the periods after each award’s vesting date. The estimated fair value of share-based awards that fully vested during the years ended December 31, 2021, 2020, and 2019 was $18,214, $12,625 and $30,526, respectively. During the years ended December 31, 2021, 2020, and 2019, 1,033, 2,109, and 295,459 RSUs, respectively, were accelerated pursuant to the terms and conditions of the Omnibus Incentive Plan and related award agreements.Grant-Date Fair ValuesThe grant-date fair values of the time-vesting RSUs and PRSUs with performance condition vesting criteria are generally based on the closing price of our common stock on the grant date. However, the grant-date fair values for share-based awards with market condition vesting criteria are based on Monte-Carlo option pricing models. The following table summarizes the significant inputs utilized in these models for such awards granted during the years ended December 31, 2021, 2020, and 2019: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | For the Years Ended December 31, | | | | | | | | | | | | | | | | 2021 | | 2020 | | 2019 | | Expected volatility(1) | | 33.2% | | 17.2 | % | — | 17.3% | | 17.2 | % | — | 17.4% | | Risk-free rate | | 0.31% | | 0.85% | | 2.25 | % | — | 2.42% | | Expected holding period (years) | | 2.84 | | 2.09 | — | 2.84 | | 2.84 | — | 2.92 | | | | | | | | | | | | | | | | | | --- | --- | --- | | | | | | | (1)Expected volatility was estimated based on the historical volatility of INVH’s realized returns and the applicable index.F-38

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Common Stock, Par or Stated Value Per Share

15

SEC-NUM

PUBLIC SERVICE COMPANY OF OKLAHOMACONDENSED BALANCE SHEETSLIABILITIES AND COMMON SHAREHOLDER’S EQUITYJune 30, 2022 and December 31, 2021(Unaudited) | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | June 30, | | December 31, | | | | 2022 | | 2021 | | | | (in millions) | | CURRENT LIABILITIES | | | | | | Advances from Affiliates | | $ | 283.4 | | | $ | 72.3 | | | Accounts Payable: | | | | | | General | | 229.8 | | | 157.4 | | | Affiliated Companies | | 88.3 | | | 51.0 | | | Long-term Debt Due Within One Year – Nonaffiliated | | 625.5 | | | 125.5 | | | Risk Management Liabilities | | — | | | 3.7 | | | Customer Deposits | | 58.8 | | | 56.2 | | | Accrued Taxes | | 54.3 | | | 27.0 | | | | | | | | | Obligations Under Operating Leases | | 8.1 | | | 6.9 | | | | | | | | | | | | | | | Other Current Liabilities | | 73.5 | | | 62.7 | | | TOTAL CURRENT LIABILITIES | | 1,421.7 | | | 562.7 | | | | | | | | | NONCURRENT LIABILITIES | | | | | | Long-term Debt – Nonaffiliated | | 1,788.3 | | | 1,788.0 | | | | | | | | | Deferred Income Taxes | | 785.4 | | | 782.3 | | | Regulatory Liabilities and Deferred Investment Tax Credits | | 830.7 | | | 835.3 | | | Asset Retirement Obligations | | 73.7 | | | 57.5 | | | | | | | | | Obligations Under Operating Leases | | 100.4 | | | 62.2 | | | Deferred Credits and Other Noncurrent Liabilities | | 18.7 | | | 19.4 | | | TOTAL NONCURRENT LIABILITIES | | 3,597.2 | | | 3,544.7 | | | | | | | | | TOTAL LIABILITIES | | 5,018.9 | | | 4,107.4 | | | | | | | | | Rate Matters (Note 4) | | | | | | Commitments and Contingencies (Note 5) | | | | | | | | | | | | COMMON SHAREHOLDER’S EQUITY | | | | | | Common Stock – Par Value – $15 Per Share: | | | | | | Authorized – 11,000,000 Shares | | | | | | Issued – 10,482,000 Shares | | | | | | Outstanding – 9,013,000 Shares | | 157.2 | | | 157.2 | | | Paid-in Capital | | 1,041.2 | | | 1,039.0 | | | Retained Earnings | | 1,144.2 | | | 1,095.4 | | | | | | | | | TOTAL COMMON SHAREHOLDER’S EQUITY | | 2,342.6 | | | 2,291.6 | | | | | | | | | TOTAL LIABILITIES AND COMMON SHAREHOLDER’S EQUITY | | $ | 7,361.5 | | | $ | 6,399.0 | | | | | | | | | See Condensed Notes to Condensed Financial Statements of Registrants beginning on page [138](#i06a79327713d4f6ab4e79d7445380253_346). | 124

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Price equal to percentage on face value

101.5

SEC-NUM

[Table of Contents](#i36695dc5143241f795c32e47bf5f4b3d_7)CBRE GROUP, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)On August 13, 2015, CBRE Services issued $600.0 million in aggregate principal amount of 4.875% senior notes due March 1, 2026 at a price equal to 99.24% of their face value. The 4.875% senior notes are unsecured obligations of CBRE Services, senior to all of its current and future subordinated indebtedness, but effectively subordinated to all of its current and future secured indebtedness. The 4.875% senior notes are guaranteed on a senior basis by us. Interest accrues at a rate of 4.875% per year and is payable semi-annually in arrears on March 1 and September 1, with the first interest payment made on March 1, 2016. The 4.875% senior notes are redeemable at our option, in whole or in part, prior to December 1, 2025 at a redemption price equal to the greater of (1) 100% of the principal amount of the 4.875% senior notes to be redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest thereon to December 1, 2025 (not including any portions of payments of interest accrued as of the date of redemption) discounted to the date of redemption on a semi-annual basis at the Adjusted Treasury Rate (as defined in the indenture governing these notes). In addition, at any time on or after December 1, 2025, the 4.875% senior notes may be redeemed by us, in whole or in part, at a redemption price equal to 100% of the principal amount, plus accrued and unpaid interest, if any, to (but excluding) the date of redemption. If a change of control triggering event (as defined in the indenture governing these notes) occurs, we are obligated to make an offer to purchase the then outstanding 4.875% senior notes at a redemption price of 101% of the principal amount, plus accrued and unpaid interest, if any, to the date of purchase. The amount of the 4.875% senior notes, net of unamortized discount and unamortized debt issuance costs, included in the accompanying consolidated balance sheets was $595.5 million and $594.5 million at December 31, 2021 and 2020, respectively.On September 26, 2014, CBRE Services issued $300.0 million in aggregate principal amount of 5.25% senior notes due March 15, 2025. On December 12, 2014, CBRE Services issued an additional $125.0 million in aggregate principal amount of 5.25% senior notes due March 15, 2025 at a price equal to 101.5% of their face value, plus interest deemed to have accrued from September 26, 2014. The 5.25% senior notes were unsecured obligations of CBRE Services, senior to all of its current and future subordinated indebtedness, but effectively subordinated to all of its current and future secured indebtedness. The 5.25% senior notes were jointly and severally guaranteed on a senior basis by us and each domestic subsidiary of CBRE Services that guaranteed our 2019 Credit Agreement. Interest accrued at a rate of 5.25% per year and was payable semi-annually in arrears on March 15 and September 15. We redeemed these notes in full on December 28, 2020 and incurred charges of $75.6 million, including a premium of $73.6 million and the write-off of $2.0 million of unamortized premium and debt issuance costs. We funded this redemption using cash on hand. The indenture governing our 4.875% senior notes and 2.500% senior notes contain restrictive covenants that, among other things, limit our ability to create or permit liens on assets securing indebtedness, enter into sale/leaseback transactions and enter into consolidations or mergers. In addition, these indentures require that the 4.875% senior notes and 2.500% senior notes be jointly and severally guaranteed on a senior basis by CBRE Group, Inc. and any domestic subsidiary that guarantees the 2021 Credit Agreement. In addition, our 2021 Credit Agreement also requires us to maintain a minimum coverage ratio of consolidated EBITDA (as defined in the 2021 Credit Agreement) to consolidated interest expense of 2.00x and a maximum leverage ratio of total debt less available cash to consolidated EBITDA (as defined in the 2021 Credit Agreement) of 4.25x (and in the case of the first four full fiscal quarters following consummation of a qualified acquisition (as defined in the 2021 Credit Agreement), 4.75x) as of the end of each fiscal quarter. Our coverage ratio of consolidated EBITDA to consolidated interest expense was 54.94x for the year ended December 31, 2021, and our leverage ratio of total debt less available cash to consolidated EBITDA was (0.04)x as of December 31, 2021.Short-Term BorrowingsWe had short-term borrowings of $1.3 billion and $1.4 billion as of December 31, 2021 and 2020, respectively, with related weighted average interest rates of 1.6% and 1.7%, respectively, which are included in the accompanying consolidated balance sheets.Revolving Credit FacilitiesThe revolving credit facility under the 2021 Credit Agreement allows for borrowings outside of the U.S., with a $200.0 million sub-facility available to CBRE Services, one of our Canadian subsidiaries, one of our Australian subsidiaries and one of our New Zealand subsidiaries and a $320.0 million sub-facility available to CBRE Services and one of our U.K. subsidiaries. Borrowings under the revolving credit facility bear interest at varying rates, based at our option, on either (1) the applicable fixed rate plus 0.68% to 1.075% or (2) the daily rate plus 0.0% to 0.075%, in each case as determined by reference to our Credit Rating (as defined in the 2021 Credit Agreement). The 2021 Credit Agreement requires us to pay a fee based on the total amount of the revolving credit facility commitment (whether used or unused). 95

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Accumulated earnings attributable to foreign subsidiaries, permanently reinvested outside of the United States

460.2

SEC-NUM

The Provision for income taxes and effective tax rates for the fiscal year ended June 30, 2022 were $133.1 million and 19.8%, compared to $148.7 million and 21.4%, for the fiscal year ended June 30, 2021, respectively. The decrease in the effective tax rate for the fiscal year ended June 30, 2022 compared to the fiscal year ended June 30, 2021 was primarily driven by higher total discrete benefits, in addition to higher ETB of $18.1 million for the fiscal year ended June 30, 2022 compared to $16.9 million for the fiscal year ended June 30, 2021.The Provision for income taxes and effective tax rates for the fiscal year ended June 30, 2021 were $148.7 million and 21.4%, compared to $117.0 million and 20.2%, for the fiscal year ended June 30, 2020, respectively. The increase in the effective tax rate for the fiscal year ended June 30, 2021 compared to the fiscal year ended June 30, 2020 was primarily driven by lower discrete benefits, partially offset by higher ETB of $16.9 million for the fiscal year ended June 30, 2021 compared to $15.6 million for the fiscal year ended June 30, 2020.As of June 30, 2022, the Company had approximately $735.7 million of accumulated earnings and profits attributable to foreign subsidiaries. The Company considers $460.2 million of accumulated earnings attributable to foreign subsidiaries to be permanently reinvested outside the U.S. and has not determined the cost to repatriate such earnings since it is not practicable to calculate the amount of income taxes payable in the event all such foreign earnings are repatriated. The Company does not consider the remaining $275.4 million of accumulated earnings to be permanently reinvested outside the U.S. The Company has accrued approximately $14.7 million of foreign income and withholding taxes, state income taxes, and tax on exchange gain attributable to such earnings. 87

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Reductions to tax positions due to statute expiration

3.0

SEC-NUM

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) The following table is a reconciliation of the U.S. statutory income tax rate to the effective income tax rate from continuing operations included in the accompanying consolidated statements of earnings: | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | Fiscal Year Ended | | | May 29, 2022 | | May 30, 2021 | | May 31, 2020 | | U.S. statutory rate | 21.0 | % | | 21.0 | % | | 21.0 | % | | State and local income taxes, net of federal tax benefits | 2.5 | | | 2.7 | | | 3.7 | | | | | | | | | | Benefit of federal income tax credits | (9.8) | | | (11.1) | | | 47.3 | | | Stock-based compensation tax benefit | (0.9) | | | (1.9) | | | 5.0 | | | Nondeductible goodwill impairment | — | | | — | | | (16.4) | | | Deferred revaluation (1) | — | | | — | | | 6.3 | | | Federal net operating loss | — | | | (20.6) | | | — | | | Other, net | (0.1) | | | 0.2 | | | 2.5 | | | Effective income tax rate (2) | 12.7 | % | | (9.7) | % | | 69.4 | % | (1)In fiscal 2020, we amended tax returns that were subject to a 35.0 percent or 29.4 percent statutory rate. Corresponding deferred tax balances were revalued at 21.0 percent.(2)Our effective income tax rate of 12.7 percent for fiscal 2022 represents income tax expense as we generated pre-tax income from continuing operations in fiscal 2022. Our effective income tax rate of (9.7) percent for fiscal 2021 represents an income tax benefit as we generated pre-tax income from continuing operations in fiscal 2021. Our effective income tax rate of 69.4 percent for fiscal 2020 represents an income tax benefit as we generated a pre-tax loss from continuing operations in fiscal 2020. As of May 29, 2022, we had estimated current prepaid federal income taxes of $274.8 million, which is included on our accompanying consolidated balance sheets as prepaid income taxes and estimated current state and federal income taxes payable of $28.5 million and $3.6 million, respectively, which is included on our accompanying consolidated balance sheets as accrued income taxes. As of May 29, 2022, we had unrecognized tax benefits of $22.2 million, which represents the aggregate tax effect of the differences between tax return positions and benefits recognized in our consolidated financial statements, all of which would favorably affect the effective tax rate if resolved in our favor. Included in the balance of unrecognized tax benefits at May 29, 2022, is $5.8 million related to tax positions for which it is reasonably possible that the total amounts could change during the next 12 months based on the outcome of examinations. Of the $5.8 million, $3.7 million relates to items that would impact our effective income tax rate.A reconciliation of the beginning and ending amount of unrecognized tax benefits follows: | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | (in millions) | | | Balances at May 30, 2021 | $ | 51.8 | | | Additions related to current-year tax positions | 4.0 | | | | | | Reductions related to prior-year tax positions | (26.1) | | | Net reductions due to settlements with taxing authorities | (4.5) | | | Reductions to tax positions due to statute expiration | (3.0) | | | Balances at May 29, 2022 | $ | 22.2 | | Interest included in income tax expense in our consolidated statements of earnings is as follows: | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | Fiscal Year Ended | | (in millions) | May 29, 2022 | | May 30, 2021 | | May 31, 2020 | | Interest recorded on unrecognized tax benefits | $ | 1.3 | | | $ | 0.7 | | | $ | 1.8 | | | Interest recorded on income tax receivables | $ | (3.1) | | | $ | — | | | $ | — | | | Total (Benefit) Expense | $ | (1.8) | | | $ | 0.7 | | | $ | 1.8 | | 69

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Additional amount deposited against products-related show cause notice

10

SEC-NUM

[Table of Contents](#i43adbcd383bc4dc48977980bcb999d17_79) HP INC. AND SUBSIDIARIESNotes to Consolidated Financial Statements (Continued)Note 14: Litigation and Contingencies (Continued) claims are pending against HPE. Because the court granted plaintiffs’ motion for preliminary certification of the putative nationwide ADEA collectives, a third-party administrator has notified eligible former employees of their right to opt into the ADEA collective. Former employees must opt in by February 15, 2022. Plaintiffs seek monetary damages, punitive damages, and other relief. India Directorate of Revenue Intelligence Proceedings. On April 30 and May 10, 2010, the India Directorate of Revenue Intelligence (the “DRI”) issued show cause notices to Hewlett-Packard India Sales Private Limited (“HP India”), a subsidiary of HP, seven HP India employees and one former HP India employee alleging that HP India underpaid customs duties while importing products and spare parts into India and seeking to recover an aggregate of approximately $370 million, plus penalties and interest. Prior to the issuance of the notices, HP India deposited approximately $16 million with the DRI and agreed to post a provisional bond in exchange for the DRI’s agreement to not seize HP India products and spare parts or interrupt business by HP India.On April 11, 2012, the Bangalore Commissioner of Customs issued an order on the products-related notice affirming certain duties and penalties against HP India and the named individuals of approximately $386 million, of which HP India had already deposited $9 million. On December 11, 2012, HP India voluntarily deposited an additional $10 million in connection with the products-related notice. The differential duty demand is subject to interest. On April 20, 2012, the Commissioner issued an order on the parts-related notice affirming certain duties and penalties against HP India and certain of the named individuals of approximately $17 million, of which HP India had already deposited $7 million. After the order, HP India deposited an additional $3 million in connection with the parts-related notice so as to avoid certain penalties.HP India filed appeals of the Commissioner’s orders before the Customs, Excise and Service Tax Appellate Tribunal (the “Customs Tribunal”) along with applications for waiver of the pre-deposit of remaining demand amounts as a condition for hearing the appeals. The Customs Department has also filed cross-appeals before the Customs Tribunal. On January 24, 2013, the Customs Tribunal ordered HP India to deposit an additional $24 million against the products order, which HP India deposited in March 2013. On February 7, 2014, the Customs Tribunal granted HP India’s application for extension of the stay of deposit until disposal of the appeals. On October 27, 2014, the Customs Tribunal commenced hearings on the cross-appeals of the Commissioner’s orders and rejected HP India’s request to remand the matter to the Commissioner on procedural grounds. The Customs Tribunal cancelled hearings to reconvene in 2015, 2016, and January 2019. On January 20, 2021, the Customs Tribunal held a virtual hearing during which the judge allowed HP’s application for a physical hearing on the merits as soon as practicable, which will be scheduled when physical hearings resume at court. Pursuant to the separation and distribution agreement, Hewlett Packard Enterprise has agreed to indemnify HP in part, based on the extent to which any liability arises from the products and spare parts of Hewlett Packard Enterprise’s businesses.Philips Patent Litigation. In September 2020, Koninklijke Philips N.V. and Philips North America LLC (collectively, “Philips”) filed a complaint against HP for patent infringement in federal court for the District of Delaware and filed a companion complaint with the U.S. International Trade Commission (“ITC”) pursuant to Section 337 of the Tariff Act against HP and 8 other sets of respondents. Both complaints allege that certain digital video-capable devices and components thereof infringe four of Philips patents. In October 2020, the ITC instituted an investigation, and Philips later withdrew two of the four patents. On October 21, 2021, the ITC rendered an initial determination that there is no violation of Section 337. The ITC is expected to render a final decision by February 22, 2022. In the ITC proceeding, Philips seeks an order enjoining respondents from importing, or selling after importation, the accused products. In the district court case, Philips seeks unspecified damages and an injunction against HP, and the case has been stayed pending resolution of the ITC proceeding.Caltech Patent Litigation. On November 11, 2020, the California Institute of Technology (“Caltech”) filed a complaint against HP for patent infringement in the federal court for the Western District of Texas. On March 19, 2021, Caltech filed an amendment to this same complaint. The complaint as amended alleges infringement of five of Caltech’s patents, U.S. Patent Nos. 7,116,710; 7,421,032; 7,716,552; 7,916,781; and 8,284,833. The accused products are HP commercial and consumer PCs as well as wireless printers that comply with the IEEE 802.11n, 802.11ac, and/or 802.11ax standards. Caltech seeks unspecified damages and other relief. The court has stayed the case pending the decision by the U.S. Court of Appeals for the Federal Circuit in The California Inst. of Tech. v. Broadcom Ltd et al., Case No. 2020-2222. In re HP Inc. Securities Litigation (Electrical Workers Pension Fund, Local 103, I.B.E.W. v. HP Inc., et al.). On February 19, 2020, Electrical Workers Pension Fund, Local 103, I.B.E.W. filed a putative class action complaint against HP, Dion Weisler, Catherine Lesjak, and Steven Fieler in U.S. District Court in the Northern District of California. The court appointed the State of Rhode Island, Office of the General Treasurer, on behalf of the Employees’ Retirement System of Rhode Island and Iron Workers Local 580 Joint Funds as Lead Plaintiffs. Lead Plaintiffs filed an amended complaint, which 107

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Cash flow hedge gain (loss) to be reclassified within twelve months

1.1

SEC-NUM

The future minimum commitments at June 30, 2022 for the aforementioned Amended IT Services Agreement, the Amended EU IT Services Agreement, the Private Cloud Agreement, the AWS Cloud Agreement, software license agreements including hosted software arrangements, and software and hardware maintenance and support agreements are as follows: | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | Years Ending June 30, | | (in millions) | | 2023 | | $ | 138.2 | | | 2024 | | 125.8 | | | 2025 | | 110.8 | | | 2026 | | 106.4 | | | 2027 | | 78.8 | | | Thereafter | | 69.6 | | | Total | | $ | 629.7 | | OtherIt is not the Company’s business practice to enter into off-balance sheet arrangements. However, the Company is exposed to market risk from changes in foreign currency exchange rates that could impact its financial position, results of operations, and cash flows. The Company manages its exposure to these market risks through its regular operating and financing activities and, when deemed appropriate, through the use of derivative financial instruments. In January 2022, the Company entered into a series of cross-currency swap transactions which were designated as a new investment hedge against a portion of the Company’s net investment in its Euro functional subsidiaries. The Company was not a party to any outstanding derivative financial instruments at June 30, 2021. In January 2022, the Company executed a series of cross-currency swap derivative contracts with an aggregate notional amount of EUR 880 million which are designated as net investment hedges to hedge a portion of its net investment in its subsidiaries whose functional currency is the Euro. The cross-currency swap derivative contracts are agreements to pay fixed-rate interest in Euros and receive fixed-rate interest in U.S. Dollars, thereby effectively converting a portion of the Company’s U.S. Dollar denominated fixed-rate debt into Euro denominated fixed-rate debt. The cross-currency swaps mature in May 2031 to coincide with the maturity of the Fiscal 2021 Senior Notes. Accordingly, foreign currency transaction gains or losses on the qualifying net investment hedge instruments are recorded as foreign currency translation within other comprehensive income (loss), net in the Consolidated Statements of Comprehensive Income and will remain in Accumulated other comprehensive income (loss) in the Consolidated Balance Sheets until the sale or complete liquidation of the underlying foreign subsidiary. At June 30, 2022, the Company’s position on the cross-currency swaps was an asset of $101.4 million, and is recorded as part of Other non-current assets on the Consolidated Balance Sheets with the offsetting amount recorded as part of Accumulated other comprehensive income (loss), net of tax. The Company has elected the spot method of accounting whereby the net interest savings from the cross-currency swaps is recognized as a reduction in interest expense in the Company’s Consolidated Statements of Earnings. In connection with the acquisition of Itiviti in March 2021 the Company entered into two derivative instruments designed to mitigate the Company’s exposure to the impact of (i) changes in foreign exchange rates on the acquisition of Itiviti purchase consideration, and (ii) changes in interest rates on the Fiscal 2021 Senior Notes. In March 2021, the Company executed a forward foreign exchange derivative instrument (“Forward”) with an aggregate notional amount of EUR 1.955 billion. The Forward acted as an economic hedge against the impact of changes in the Euro on the Company’s purchase consideration for the acquisition of Itiviti. The Company recorded changes in fair value of the Forward as part of Other non-operating income (expenses), net in the Consolidated Statement of Earnings. In May 2021, the Company settled the Forward derivative for a cumulative pre-tax gain of $66.7 million. In March 2021, the Company also executed a forward treasury lock agreement (“Treasury Lock”), designated as a cash flow hedge, in the aggregate notional amount of $1.0 billion to manage exposure to fluctuations in the benchmark interest rate associated with the Fiscal 2021 Senior Notes, which were used to pay down a portion of the Term Credit Agreement associated with the Itiviti acquisition. Accordingly, changes in the fair value of the Treasury Lock were recorded as part of Other comprehensive income (loss), net each period up to when the Treasury Lock was settled. In May 2021, the Treasury Lock was settled for a pre-tax loss of $11.0 million, after which the final settlement loss will be amortized into Interest expense, net ratably over the ten year term of the Fiscal 2021 Senior Notes. The expected amount of the existing loss that will be amortized into earnings before income taxes within the next twelve months is approximately $1.1 million.92

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Deferred tax liabilities not recognized relating to bad debt reserved

75

SEC-NUM

Unrecognized Tax BenefitsThe following is a rollforward of the Company’s unrecognized tax benefits: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | In millions of dollars | 2021 | 2020 | 2019 | | Total unrecognized tax benefits at January 1 | $ | 861 | | $ | 721 | | $ | 607 | | | Net amount of increases for current year’s tax positions | 97 | | 51 | | 50 | | | Gross amount of increases for prior years’ tax positions | 515 | | 217 | | 151 | | | Gross amount of decreases for prior years’ tax positions | (107) | | (74) | | (44) | | | Amounts of decreases relating to settlements | (64) | | (40) | | (21) | | | Reductions due to lapse of statutes of limitation | (2) | | (13) | | (23) | | | Foreign exchange, acquisitions and dispositions | (4) | | (1) | | 1 | | | Total unrecognized tax benefits at December 31 | $ | 1,296 | | $ | 861 | | $ | 721 | | The portions of the total unrecognized tax benefits at December 31, 2021, 2020 and 2019 that, if recognized, would affect Citi’s tax expense are $1.0 billion, $0.7 billion and $0.6 billion, respectively. The remaining uncertain tax positions have offsetting amounts in other jurisdictions or are temporary differences.Interest and penalties (not included in unrecognized tax benefits above) are a component of Provision for income taxes. | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | 2021 | 2020 | 2019 | | In millions of dollars | Pretax | Net of tax | Pretax | Net of tax | Pretax | Net of tax | | Total interest and penalties on the Consolidated Balance Sheet at January 1 | $ | 118 | | $ | 96 | | $ | 100 | | $ | 82 | | $ | 103 | | $ | 85 | | | Total interest and penalties in the Consolidated Statement of Income | 32 | | 24 | | 14 | | 10 | | (4) | | (4) | | | Total interest and penalties on the Consolidated Balance Sheet at December 31(1) | 214 | | 164 | | 118 | | 96 | | 100 | | 82 | | (1)Includes $3 million, $4 million and $3 million for non-U.S. penalties in 2021, 2020 and 2019, respectively. Also includes $0 million, $1 million and $1 million for state penalties in 2021, 2020 and 2019, respectively. As of December 31, 2021, Citi was under audit by the Internal Revenue Service and other major taxing jurisdictions around the world. It is thus reasonably possible that significant changes in the gross balance of unrecognized tax benefits may occur within the next 12 months. The potential range of amounts that could affect Citi’s effective tax rate is between $0 and $500 million.The following are the major tax jurisdictions in which the Company and its affiliates operate and the earliest tax year subject to examination: | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | Jurisdiction | Tax year | | United States | 2016 | | Mexico | 2016 | | New York State and City | 2009 | | United Kingdom | 2016 | | India | 2017 | | | | | Singapore | 2019 | | Hong Kong | 2015 | | Ireland | 2017 | Non-U.S. EarningsNon-U.S. pretax earnings approximated $12.9 billion in 2021, $13.8 billion in 2020 and $16.7 billion in 2019. As a U.S. corporation, Citigroup and its U.S. subsidiaries are currently subject to U.S. taxation on all non-U.S. pretax earnings of non-U.S. branches. Beginning in 2018, there is a separate foreign tax credit (FTC) basket for branches. Also, dividends from a non-U.S. subsidiary or affiliate are effectively exempt from U.S. taxation. The Company provides income taxes on the book over tax basis differences of non-U.S. subsidiaries except to the extent that such differences are indefinitely reinvested outside the U.S. At December 31, 2021, $6.5 billion of basis differences of non-U.S. entities was indefinitely invested. At the existing tax rates (including withholding taxes), additional taxes (net of U.S. FTCs and valuation allowances) of $1.8 billion would have to be provided if such assertions were reversed.Income taxes are not provided for the Company’s “savings bank base year bad debt reserves” that arose before 1988, because under current U.S. tax rules, such taxes will become payable only to the extent that such amounts are distributed in excess of limits prescribed by federal law. At December 31, 2021, the amount of the base year reserves totaled approximately $358 million (subject to a tax of $75 million).184

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Estimated Return On Equity Complaint Refund

60

SEC-NUM

[Table of Contents](#i6266d2788e5849989ad57be380853c2d_7)Entergy Corporation and SubsidiariesNotes to Financial Statements period, based on their respective interpretations and applications of the Opinion No. 569-A methodology, the LPSC argues for an authorized return on equity for System Energy of 7.97%; the MPSC and APSC argue for an authorized return on equity of 9.24%; and the FERC trial staff argues for an authorized return on equity of 9.49%. For the second refund period and on a prospective basis, based on their respective interpretations and applications of the Opinion No. 569-A methodology, the LPSC argues for an authorized return on equity for System Energy of 7.78%; the MPSC and APSC argue that an authorized return on equity of 9.15% may be appropriate if the second complaint is not dismissed; and the FERC trial staff argues for an authorized return on equity of 9.09% if the second complaint is not dismissed. Pursuant to the revised procedural schedule, in July 2020, System Energy filed supplemental testimony addressing Opinion No. 569-A. System Energy argues that strict application of the Opinion No. 569-A methodology produces results inconsistent with investor requirements and does not provide a sound basis on which to evaluate System Energy’s authorized return on equity. As its primary recommendation, System Energy argues for the use of a methodology that incorporates four separate financial models, including the constant growth form of the discounted cash flow model and the empirical capital asset pricing model. Based on application of its recommended methodology, System Energy argues for an authorized return on equity of 10.12% for the first refund period, which also falls within the presumptively just and reasonable range calculated for the second refund period and prospectively. Under the Opinion No. 569-A methodology, System Energy calculates an authorized return on equity of 9.44% for the first refund period, which also falls within the presumptively just and reasonable range calculated for the second refund period and prospectively. The parties and FERC trial staff filed final rounds of testimony in August 2020. The hearing before a FERC ALJ occurred in late-September through early-October 2020, post-hearing briefing took place in November and December 2020. In March 2021 the FERC ALJ issued an initial decision. With regard to System Energy’s authorized return on equity, the ALJ determined that the existing return on equity of 10.94% is no longer just and reasonable, and that the replacement authorized return on equity, based on application of the Opinion No. 569-A methodology, should be 9.32%. The ALJ further determined that System Energy should pay refunds for a fifteen-month refund period (January 2017-April 2018) based on the difference between the current return on equity and the replacement authorized return on equity. The ALJ determined that the April 2018 complaint concerning the authorized return on equity should be dismissed, and that no refunds for a second fifteen-month refund period should be due. With regard to System Energy’s capital structure, the ALJ determined that System Energy’s actual equity ratio is excessive and that the just and reasonable equity ratio is 48.15% equity, based on the average equity ratio of the proxy group used to evaluate the return on equity for the second complaint. The ALJ further determined that System Energy should pay refunds for a fifteen-month refund period (September 2018-December 2019) based on the difference between the actual equity ratio and the 48.15% equity ratio. If the ALJ’s initial decision is upheld, the estimated refund for this proceeding is approximately $60 million, which includes interest through December 31, 2021, and the estimated resulting annual rate reduction would be approximately $45 million. The estimated refund will continue to accrue interest until a final FERC decision is issued. Based on the course of the proceeding to date, System Energy has recorded a provision of $37 million, including interest, as of December 31, 2021. The ALJ initial decision is an interim step in the FERC litigation process, and an ALJ’s determinations made in an initial decision are not controlling on the FERC. In April 2021, System Energy filed its brief on exceptions, in which it challenged the initial decision’s findings on both the return on equity and capital structure issues. Also in April 2021 the LPSC, APSC, MPSC, City Council, and the FERC trial staff filed briefs on exceptions. Reply briefs opposing exceptions were filed in May 2021 by System Energy, the FERC trial staff, the LPSC, APSC, MPSC, and the City Council. Refunds, if any, that might be required will only become due after the FERC issues its order reviewing the initial decision. 96

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Associated future global development costs , if elected to co-develop (as a percent)

35

SEC-NUM

[Table of Contents](#ie2ffba3ee5384c86becdb38ff117ca9a_7)In addition, in 2017 we purchased 10.0 million shares of Agenus Inc.’s common stock for an aggregate purchase price of $60.0 million in cash, or $6.00 per share. In 2020, we sold an aggregate of approximately 3.7 million shares of Agenus Inc.’s common stock resulting in gross proceeds of approximately $17.2 million. In 2021, we sold an aggregate of approximately 2.0 million shares of Agenus Inc.’s common stock resulting in gross proceeds of approximately $10.5 million. The fair market value of our long term investment in Agenus Inc. at September 30, 2022 and December 31, 2021 was $24.8 million and $38.9 million, respectively.We intend to hold the investment in Agenus Inc. for the foreseeable future and therefore, are accounting for our shares held in Agenus Inc. at fair value whereby the investment is marked to market through earnings in each reporting period. Given our intent to hold the investment for the foreseeable future, we have classified the investment within long term investments on the accompanying condensed consolidated balance sheets. For the three and nine months ended September 30, 2022, we recorded an unrealized gain of $1.3 million and an unrealized loss of $14.1 million, respectively, based on the change in fair value of Agenus Inc.’s common stock during the respective periods. For the three and nine months ended September 30, 2021, we recorded an unrealized loss of $2.8 million and an unrealized gain of $29.1 million, respectively, based on the change in fair value of Agenus Inc.’s common stock during the respective periods. MerusIn December 2016, we entered into a Collaboration and License Agreement with Merus N.V. (“Merus”). Under this agreement, the parties have agreed to collaborate with respect to the research, discovery and development of bispecific antibodies utilizing Merus’ technology platform. The collaboration encompasses up to ten independent programs. In January 2022, we decided to opt-out of the continued development of MCLA-145, a bispecific antibody targeting PD-L1 and CD137. We continue to collaborate with Merus and leverage the Merus platform to develop a pipeline of novel agents, as we continue to hold worldwide exclusive development and commercialization rights to up to ten additional programs. Of these ten additional programs, Merus retained the option, subject to certain conditions, to co-fund development of up to two such programs. If Merus exercises its co-funding option for a program, Merus would be responsible for funding 35% of the associated future global development costs and, for certain of such programs, would be responsible for reimbursing us for certain development costs incurred prior to the option exercise. Merus will also have the right to participate in a specified proportion of detailing activities in the United States for one of those co-developed programs. All costs related to the co-funded collaboration programs are subject to joint research and development plans and overseen by a joint development committee, but we will have final determination as to such plans in cases of dispute. We will be responsible for all research, development and commercialization costs relating to all other programs. For each program as to which Merus does not have commercialization or development co-funding rights, Merus is eligible to receive up to $100.0 million in future contingent development and regulatory milestones, and up to $250.0 million in commercialization milestones as well as tiered royalties ranging from 6% to 10% of global net sales. For each program as to which Merus exercises its option to co-fund development, Merus is eligible to receive a 50% share of profits (or sustain 50% of any losses) in the United States and be eligible to receive tiered royalties ranging from 6% to 10% of net sales of products outside of the United States. If Merus opts to cease co-funding a program as to which it exercised its co-development option, then Merus will no longer receive a share of profits in the United States but will be eligible to receive the same milestones from the co-funding termination date and the same tiered royalties described above with respect to programs where Merus does not have a right to co-fund development and, depending on the stage at which Merus chose to cease co-funding development costs, Merus will be eligible to receive additional royalties ranging up to 4% of net sales in the United States. As of September 30, 2022, we have paid Merus milestones totaling $3.0 million.In addition, in 2016 we entered into a Share Subscription Agreement with Merus, pursuant to which we purchased 3.2 million common shares of Merus for an aggregate purchase price of $80.0 million in cash, or $25.00 per share. In January 2021, we purchased 350,000 common shares in Merus’ underwritten public offering of 4,848,485 common shares at the public offering price of $24.75 per share, or an aggregate purchase price of $8.7 million. The fair market value of our total long term investment in Merus at September 30, 2022 and December 31, 2021 was $71.1 million and $112.9 million, respectively. As of September 30, 2022, we owned approximately 8% of the outstanding common shares of Merus.16

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Long-term fixed rate debt, including current portion, at Carrying Value

399,733

SEC-NUM

[Table of Contents](#i988317c7021a4a8fa66f2208a2958f7e_10)NOTE 10 – Fair Value Measurements The following table summarizes the carrying values and fair values of the Company’s financial instruments that were not carried at fair value in the consolidated balance sheets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | July 31, 2022 | | July 31, 2021 | | (In thousands) | Carrying Value Total | | | | Fair Value Total | | Carrying Value Total | | | | Fair Value Total | | Assets | | | | | | | | | | | | | Cash equivalents | $ | 1,236,990 | | | | | $ | 1,237,337 | | | $ | 754,300 | | | | | $ | 754,304 | | | | | | | | | | | | | | | | Total Assets | $ | 1,236,990 | | | | | $ | 1,237,337 | | | $ | 754,300 | | | | | $ | 754,304 | | | Liabilities | | | | | | | | | | | | | | | | | | | | | | | | | | Long-term fixed rate debt, including current portion | $ | — | | | | | $ | — | | | $ | 399,733 | | | | | $ | 432,027 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Total Liabilities | $ | — | | | | | $ | — | | | $ | 399,733 | | | | | $ | 432,027 | | During the year ended July 31, 2022, no transfers were made between any levels within the fair value hierarchy. The fair value of the Senior Notes is based on the discounted value of each interest and principal payment calculated utilizing market interest rates of similar types of borrowing arrangements and was classified within Level II of the fair value hierarchy. See Note 1 — Summary of Significant Accounting Policies and Note 9 — Long-Term Debt. NOTE 11 — Net Income Per Share The table below reconciles basic weighted average shares outstanding to diluted weighted average shares outstanding: | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | Year Ended July 31, | | (In thousands) | | 2022 | | 2021 | | 2020 | | Weighted average common shares outstanding | | 237,419 | | | 236,252 | | | 233,202 | | | Effect of dilutive securities | | 3,732 | | | 4,038 | | | 5,454 | | | Weighted average common and dilutive potential common shares outstanding | | 241,151 | | | 240,290 | | | 238,656 | | There were no material adjustments to net income required in calculating diluted net income per share. Excluded from the dilutive earnings per share calculation were 3,722,762; 4,090,250; and 1,575,167 options to purchase the Company’s common stock for the years ended July 31, 2022, 2021 and 2020, respectively, because their inclusion would have been anti-dilutive. NOTE 12 — Stockholders’ Equity General The Company has authorized the issuance of 400 million shares of common stock, with a par value of $0.0001, of which 238,040,974 shares were issued and outstanding at July 31, 2022. As of July 31, 2022 and 2021, the Company had reserved 14,378,120 and 15,326,030 shares of common stock, respectively, for the issuance of options, restricted stock or restricted stock units granted under the Company’s stock option plans and 1,100,458 and 1,194,213 shares of common stock, respectively, for the issuance of shares under the Copart, Inc. Employee Stock Purchase Plan (“ESPP”). The Company has authorized the issuance of five million shares of preferred stock, with a par value of $0.0001, none of which were issued or outstanding at July 31, 2022 or 2021, which have the rights and preferences as the Company’s Board of Directors shall determine, from time to time. Stock Repurchases On September 22, 2011, the Company’s Board of Directors approved an 80 million share increase in the stock repurchase program, bringing the total current authorization to 196 million shares. The repurchases may be effected through solicited or unsolicited transactions in the open market or in privately negotiated transactions. No time limit has been placed on the duration of the stock repurchase program. Subject to applicable securities laws, such repurchases will be made at such times and in such amounts as the Company deems appropriate and may be discontinued at any time. For fiscal 2022 and 2021, the Company did not repurchase any shares of its common stock under the program. As of July 31, 2022, the total number of shares repurchased under the program was 114,549,198, and 81,450,802 shares were available for repurchase under the program. 75

string

Atchison Renewable Energy Center purchase price

500

SEC-NUM

[Table of Co](#i2c056a9f8317485ea6601862f5b0559f_7)[ntents](#i2c056a9f8317485ea6601862f5b0559f_7)Property, Plant, and EquipmentIn January 2021, Ameren Missouri acquired a 300-MW wind generation project located in northwestern Missouri. As of June 30, 2021, Ameren Missouri had placed the project in service as the Atchison Renewable Energy Center. The purchase price of the energy center was approximately $500 million, including an immaterial amount of transaction costs. In December 2020, Ameren Missouri acquired a 400-MW wind generation project located in northeastern Missouri for approximately $615 million, and placed the assets in service as the High Prairie Renewable Energy Center. The purchase price included $564 million of cash, a deferred purchase price obligation withheld as credit support in relation to certain potential claims, contingent consideration, and transaction costs. Both renewable energy centers support Ameren Missouri’s compliance with the Missouri renewable energy standard.Asset Retirement ObligationsThe following table provides a reconciliation of the beginning and ending carrying amount of AROs for the years ended December 31, 2021 and 2020: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | December 31, 2021 | | | December 31, 2020 | | | AmerenMissouri | | AmerenIllinois | | | | Ameren | | | | AmerenMissouri | | AmerenIllinois | | Ameren | | | Beginning balance at January 1 | $ | 751 | | | $ | 5 | | | | (a) | $ | 756 | | (b) | | | $ | 687 | | | $ | 4 | | | $ | 691 | | | | Liabilities incurred | 18 | | (c) | — | | | | | 18 | | (c) | | | 36 | | (c) | — | | | 36 | | (c) | | Liabilities settled | (36) | | | (1) | | | | | (37) | | | | | (58) | | | — | | | (58) | | | | Accretion(d) | 31 | | | — | | | | | 31 | | | | | 29 | | | 1 | | | 30 | | | | Change in estimates | (4) | | (e) | — | | | | | (4) | | (e) | | | 57 | | (f) | — | | | 57 | | (f) | | Ending balance at December 31 | $ | 760 | | (g) | $ | 4 | | | | (a) | $ | 764 | | (b)(g) | | | $ | 751 | | | $ | 5 | | (a) | $ | 756 | | (b) | (a)Included in “Other deferred credits and liabilities” on the balance sheet.(b)Balance included $7 million and $60 million in “Other current liabilities” on the balance sheet as of December 31, 2021 and 2020, respectively.(c)Ameren Missouri recorded AROs related to the decommissioning of the Atchison Renewable and High Prairie Renewable energy centers in 2021 and 2020, respectively.(d)Accretion expense attributable to Ameren Missouri and Ameren Illinois was recorded as a decrease to regulatory liabilities and an increase to regulatory assets, respectively.(e)Ameren Missouri changed its fair value estimate primarily due to a decrease in the cost estimate for closure of certain CCR storage facilities, partially offset by an increase due to the planned accelerated retirement of the Rush Island Energy Center.(f)Ameren Missouri changed its fair value estimate primarily due to an update to the decommissioning of the Callaway Energy Center to reflect the cost study and funding analysis filed with the MoPSC in November 2020 and an increase in the cost estimate for closure of certain CCR storage facilities.(g)The balance as of December 31, 2021, included an ARO related to the decommissioning of the Callaway Enter Center of $574 million.Noncontrolling InterestsAs of December 31, 2021 and 2020, Ameren’s noncontrolling interests included the preferred stock of Ameren Missouri and Ameren Illinois.Deferred CompensationAs of December 31, 2021, and 2020, the present value of benefits to be paid for deferred compensation obligations was $91 million and $90 million, respectively, which was primarily reflected in “Other deferred credits and liabilities” on Ameren’s consolidated balance sheet.Excise TaxesAmeren Missouri and Ameren Illinois collect from their customers excise taxes, including municipal and state excise taxes and gross receipts taxes, that are levied on the sale or distribution of natural gas and electricity. The following table presents the excise taxes recorded on a gross basis in “Operating Revenues – Electric,” “Operating Revenues – Natural gas” and “Operating Expenses – Taxes other than income taxes” on the statements of income for the years ended December 31, 2021, 2020, and 2019: | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | 2021 | | 2020 | | 2019 | | | Ameren Missouri | $ | 150 | | | $ | 139 | | | $ | 147 | | | | Ameren Illinois | 125 | | | 115 | | | 117 | | | | Ameren | $ | 275 | | | $ | 254 | | | $ | 264 | | | 152

string

Contract with customer, liability, revenue recognized

123.2

SEC-NUM

[Table of Contents](#i3d0ebbc4e2a2420f98ed7e6fe698936a_7) HASBRO, INC. AND SUBSIDIARIESNotes to Consolidated Financial Statements — (Continued) (2) Revenue RecognitionContract Assets and LiabilitiesIn the ordinary course of business, the Company’s Consumer Products and Entertainment segments enter into contracts to license certain of the Company’s intellectual property, providing licensees right-to-use access for use in the production and sale of consumer products and digital game development, and for use within content for distribution over streaming platforms and for television and film. The Company also licenses owned television and film content for distribution to third parties in formats that include broadcast, digital streaming and theatrical. Through these arrangements, the Company may receive advanced royalty payments from licensees, either in advance of a licensees’ subsequent sales to customers or, prior to the completion of the Company’s performance obligation. In addition, the Company’s Wizards of the Coast and Digital Gaming segment may receive advanced payments from end users of its digital games at the time of the initial purchase or through in-application purchases. These digital gaming revenues are recognized over a period of time, determined based on player usage patterns or the estimated playing life of the user or when additional downloadable content is made available. The Company defers revenues on all licensee and digital gaming advanced payments until the respective performance obligations are satisfied. The Company records the aggregate deferred revenues as contract liabilities, with the current portion recorded within Accrued Liabilities and the long-term portion recorded as Other Non-current Liabilities in the Company’s consolidated balance sheets. The Company records contract assets in the case of (1) minimum guarantees being recognized in advance of contractual invoicing, which are recognized ratably over the terms of the respective license periods, and (2) film and television distribution revenues recorded for content delivered, where payment will occur over the license term. The current portion of contract assets is recorded in Prepaid Expenses and Other Current Assets, respectively, and the long-term portion is recorded within Other Long-Term Assets.At December 26, 2021 and December 27, 2020, the Company had the following contract assets and liabilities in its consolidated balance sheets: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | (In millions) | December 26, 2021 | | December 27, 2020 | | Assets | | | | | Contract assets - current | $ | 286.9 | | | 284.4 | | | Contract assets - long term | 104.2 | | | 77.0 | | | Total | $ | 391.1 | | | 361.4 | | | | | | | | Liabilities | | | | | Contract liabilities - current | $ | 114.1 | | | 161.0 | | | Contract liabilities - long term | 7.1 | | | 18.2 | | | Total | $ | 121.2 | | | 179.2 | | For the year ended December 26, 2021, the Company recognized $49.4 million of the contract assets and $123.2 million of contract liabilities that were included in the December 27, 2020 balances.Unsatisfied Performance ObligationsUnsatisfied performance obligations relate primarily to in-production television content to be delivered in the future under existing agreements with partnering content providers such as broadcasters, distributors, television networks and subscription video on demand services. As of December 26, 2021, unrecognized revenue attributable to unsatisfied performance obligations expected to be recognized in the future was $304.1 million. Of this amount, we expect to recognize approximately $238.1 million in 2022, $53.9 million in 2023, and $12.1 million in 2024. These amounts include only fixed consideration. Accounts Receivable and Allowance for Credit LossesThe Company’s balance for accounts receivable on the consolidated balance sheets as of December 26, 2021 and December 27, 2020 are primarily from contracts with customers. In the year ended December 29, 2019, the Company recorded a charge for credit losses for accounts receivable of approximately $49.0 million related to Toys“R”Us. The Company had no other material expense for credit losses in the years ended December 26, 2021, December 27, 2020, or December 29, 2019.88

string

Weighted-average discount rate

4.0

SEC-NUM

[Table of Contents](#i4552998170a04ab690e0e4bebd2d8dfd_7) FMC CORPORATIONNotes to Condensed Consolidated Financial Statements (unaudited) — (Continued)real estate leases requiring additional payments for property taxes and occupancy-related costs. Leases for real estate typically have initial terms ranging from one to 20 years, with some leases having terms greater than 20 years. Leases for non-real estate (transportation, IT) typically have initial terms ranging from one to 10 years. We have elected not to record short-term leases on the balance sheet whose term is 12 months or less and does not include a purchase option or extension that is reasonably certain to be exercised.We rent or sublease a small number of assets including equipment and office space to third party companies. These third-party arrangements include a small number of TSA arrangements from recent acquisitions. Rental income from all subleases is not material to our business.The ROU asset and lease liability balances as of September 30, 2022 and December 31, 2021 were as follows: | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | (in Millions) | Classification | September 30, 2022 | | December 31, 2021 | | Assets | | | | | | | | | | | | Operating lease ROU assets | Other assets including long-term receivables, net | $ | 123.9 | | | $ | 135.2 | | | | | | | | | Liabilities | | | | | | | | | | | | Operating lease current liabilities | Accrued and other liabilities | $ | 22.5 | | | $ | 23.5 | | | | | | | | | | | | | | | | | | | | | Operating lease noncurrent liabilities | Other long-term liabilities | 127.5 | | | 140.0 | | | | | | | | | | | | | | The components of lease expense for the three and nine months ended September 30, 2022 and 2021 were as follows: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended September 30, | | Nine Months Ended September 30, | | (in Millions) | Lease Cost Classification | 2022 | | 2021 | | 2022 | | 2021 | | Lease Cost | | | | | | | | | | Operating lease cost | Costs of sales and services / Selling, general and administrative expenses | $ | 8.5 | | | $ | 8.3 | | | $ | 25.3 | | | $ | 25.6 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Variable lease cost | Costs of sales and services / Selling, general and administrative expenses | 1.8 | | | 1.2 | | | 4.4 | | | 3.6 | | | | | | | | | | | | | Total lease cost | | $ | 10.3 | | | $ | 9.5 | | | $ | 29.7 | | | $ | 29.2 | | | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | September 30, 2022 | | Operating Lease Term and Discount Rate | | | Weighted-average remaining lease term (years) | 8.6 | | | | | | | | Weighted-average discount rate | 4.0 | % | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended September 30, | | Nine Months Ended September 30, | | (in Millions) | 2022 | | 2021 | | 2022 | | 2021 | | Other Information | | | | | | | | | | | | | | | | | | Cash paid for amounts included in the measurement of lease liabilities: | | | | | | | | | Operating cash flows from operating leases | $ | (8.1) | | | $ | (7.9) | | | $ | (25.2) | | | $ | (25.5) | | | | | | | | | | | | | | | | | | | | | Supplemental non-cash information on lease liabilities arising from obtaining right-of-use assets: | | | | | | | | | Right-of-use assets obtained in exchange for new operating lease liabilities | $ | 5.4 | | | $ | 0.8 | | | $ | 15.5 | | | $ | 16.7 | | | | | | | | | | | 37

string

Change in tax rates from change in tax law

1.2

SEC-NUM

CAESARS ENTERTAINMENT, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)Note 17. Income Taxes The components of the Company’s provision for income taxes for the years ended December 31, 2021, 2020 and 2019 are presented below. | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | Components of Income (Loss) Before Income Taxes | Years Ended December 31, | | (In millions) | 2021 | | 2020 | | 2019 | | United States | $ | (1,272) | | | $ | (1,608) | | | $ | 125 | | | Outside of the U.S. | 3 | | | 2 | | | — | | | | $ | (1,269) | | | $ | (1,606) | | | $ | 125 | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | Income Tax Provision (Benefit) | Years Ended December 31, | | (In millions) | 2021 | | 2020 | | 2019 | | United States | | | | | | | Current | | | | | | | Federal | $ | (1) | | | $ | (43) | | | $ | 31 | | | State & Local | (2) | | | (24) | | | 14 | | | Deferred | | | | | | | Federal | (219) | | | 208 | | | 5 | | | State & Local | (106) | | | (11) | | | (6) | | | Outside of the U.S. | | | | | | | Current | 2 | | | 2 | | | — | | | Deferred | 43 | | | — | | | — | | | | $ | (283) | | | $ | 132 | | | $ | 44 | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | Allocation of Income Tax Provision (Benefit) | Years Ended December 31, | | (In millions) | 2021 | | 2020 | | 2019 | | Income tax provision (benefit) applicable to: | | | | | | | Income from operations | $ | (283) | | | $ | 132 | | | $ | 44 | | | Discontinued operations | 19 | | | (9) | | | — | | | Other comprehensive income | 3 | | | 8 | | | — | | The following is a reconciliation of the statutory federal income tax rate to the Company’s effective tax rate for the years ended December 31, 2021, 2020 and 2019: | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | Effective Income Tax Rate Reconciliation | Years Ended December 31, | | | 2021 | | 2020 | | 2019 | | Federal statutory rate | 21.0 | % | | 21.0 | % | | 21.0 | % | | State and local taxes | 4.2 | % | | 5.4 | % | | 5.5 | % | | Stock compensation | 0.5 | % | | (0.1) | % | | 1.8 | % | | Goodwill impairment and dispositions | — | % | | (1.6) | % | | 7.4 | % | | Nondeductible transaction expenses | — | % | | (0.5) | % | | — | % | | Nondeductible convertible notes costs | (3.3) | % | | (1.0) | % | | — | % | | Decrease in uncertain tax positions | 0.4 | % | | 0.9 | % | | — | % | | Change in tax rates from change in tax law | (1.2) | % | | — | % | | — | % | | Deferred tax benefit of foreign subsidiaries held for sale | — | % | | 1.0 | % | | — | % | | Valuation allowance | 2.6 | % | | (33.9) | % | | 1.8 | % | | Deferred tax recognition on life insurance | (1.3) | % | | — | % | | — | % | | Tax credits | 0.4 | % | | 0.1 | % | | (1.1) | % | | Other | (1.0) | % | | 0.5 | % | | (1.2) | % | | Effective income tax rate | 22.3 | % | | (8.2) | % | | 35.2 | % | [Table of Contents](#i37dfc5eabc12461dbfc5ef573d80947e_7)109

string

Unrecognized tax benefits, decrease from settlements

1.6

SEC-NUM

AMERICAN TOWER CORPORATION AND SUBSIDIARIESNOTES TO CONSOLIDATED AND CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(tabular amounts in millions, unless otherwise noted)8. INCOME TAXES The Company provides for income taxes at the end of each interim period based on the estimated effective tax rate (“ETR”) for the full fiscal year. Cumulative adjustments to the Company’s estimate are recorded in the interim period in which a change in the estimated annual ETR is determined. Under the provisions of the Internal Revenue Code of 1986, as amended, the Company may deduct amounts distributed to stockholders against the income generated by its real estate investment trust (“REIT”) operations. The Company continues to be subject to income taxes on the income of its domestic taxable REIT subsidiaries and income taxes in foreign jurisdictions where it conducts operations. In addition, the Company is able to offset certain income by utilizing its net operating losses, subject to specified limitations. The Company provides valuation allowances if, based on the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. Management assesses the available evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets.The decreases in the income tax provision during the three and nine months ended September 30, 2022 were primarily attributable to fewer additions to reserves for the Company’s existing tax positions and reduced earnings in certain foreign jurisdictions. The decrease in the income tax provision during the nine months ended September 30, 2022 also included the reversal of valuation allowances of $79.7 million in certain jurisdictions, as compared to a reversal of $8.8 million during the nine months ended September 30, 2021. These valuation allowance reversals were recognized as a reduction to the income tax provision as the net related deferred tax assets were deemed realizable based on changes in facts and circumstances relevant to the assets’ recoverability.As of September 30, 2022 and December 31, 2021, the total unrecognized tax benefits that would impact the ETR, if recognized, were approximately $99.7 million and $94.8 million, respectively. The amount of unrecognized tax benefits during the three and nine months ended September 30, 2022 includes (i) additions to the Company’s existing tax positions of $2.2 million and $11.8 million, respectively, including remeasurements of acquired liabilities of $3.5 million for the nine months ended September 30, 2022, (ii) reductions due to foreign currency exchange rate fluctuations of $3.9 million and $6.3 million, respectively, and (iii) reductions due to settlements of $1.6 million. Unrecognized tax benefits are expected to change over the next 12 months if certain tax matters ultimately settle with the applicable taxing jurisdiction during this time frame, as described in note 12 to the Company’s consolidated financial statements included in the 2021 Form 10-K. The impact of the amount of these changes to previously recorded uncertain tax positions could range from zero to $23.3 million.The Company recorded the following penalties and income tax-related interest expense during the three and nine months ended September 30, 2022 and 2021: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended September 30, | | Nine Months Ended September 30, | | | | 2022 | | 2021 | | 2022 | | 2021 | | Penalties and income tax-related interest expense (1) | | $ | 3.7 | | | $ | 9.6 | | | $ | 15.2 | | | $ | 43.1 | | \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(1)Nine months ended September 30, 2021 reflects an increase of $16.6 million due to a reclassification of unrecognized tax benefits to penalties and income tax-related interest expense.As of September 30, 2022 and December 31, 2021, the total amount of accrued income tax related interest and penalties included in the consolidated balance sheets were $52.8 million and $42.3 million, respectively. 9. STOCK-BASED COMPENSATION Summary of Stock-Based Compensation Plans—The Company maintains equity incentive plans that provide for the grant of stock-based awards to its directors, officers and employees. The Company’s 2007 Equity Incentive Plan, as amended (the “2007 Plan”), provides for the grant of non-qualified and incentive stock options, as well as restricted stock units, restricted stock and other stock-based awards. Exercise prices for non-qualified and incentive stock options are not less than the fair value of the underlying common stock on the date of grant. Equity awards typically vest ratably, generally over four years for time-based restricted stock units (“RSUs”) and stock options and three years for performance-based restricted stock units (“PSUs”). Stock options generally expire ten years from the date of grant. As of September 30, 2022, the Company had the ability to grant stock-based awards with respect to an aggregate of 5.2 million shares of common stock under the 2007 Plan. In connection with the CoreSite Acquisition, the Company assumed the remaining shares previously available for issuance under a plan approved by the CoreSite shareholders, which converted into 1.4 million shares of the Company’s common stock. These shares will be available for issuance under the 2007 Plan, however, will only be available for grants to certain employees and will not be available for issuance beyond the period 18

string

System-Wide Offer Cap

5,000

SEC-NUM

[Table of Contents](#i0fa971ac9e834218957059819155291f_10)Combined Notes to Consolidated Financial Statements(Dollars in millions, except per share data unless otherwise noted) Note 3 — Regulatory Mattersincluding the implementation of additional ancillary service products as well as changes to the high system-wide offer cap and operating reserve demand curve, which remain pending. On December 2, 2021, the PUCT reduced ERCOT’s high system-wide offer cap to $5,000 per MWh.In February 2021, more than 70 local distribution companies (LDCs) and natural gas pipelines in multiple states throughout the mid-continent region, where Generation serves natural gas customers, issued operational flow orders (OFOs), curtailments or other limitations on natural gas transportation or use to manage the operational integrity of the applicable LDC or pipeline system. When in effect, gas transportation or use above these limitations is subject to significant penalties according to the applicable LDCs’ and natural gas pipelines’ tariffs. Gas transportation and supply in many states became restricted due to wells freezing and pipeline compression disruption, while demand was increasing due to the extreme cold temperatures, resulting in extremely high natural gas prices. Due to the extraordinary circumstances, many LDCs and natural gas pipelines have either voluntarily waived or have sought applicable regulatory approvals to waive the tariff penalties associated with the extreme weather event. During March 2021, three natural gas pipelines filed individual petitions with FERC requesting approval to waive OFO penalties. Generation also filed motions in March 2021 to intervene and filed comments in support of these FERC waiver requests. On March 25, 2021, FERC issued an order on one of the petitions approving a pipeline’s request for a limited waiver of penalties for February 15, 2021. On April 23, 2021, Generation and several other entities filed a request at FERC for rehearing of this order which was denied on May 24, 2021. Generation and the other entities filed an appeal of the rehearing of the order with the U.S. Court of Appeals for the D.C. Circuit on July 21, 2021. Additionally, Generation and the other entities filed a complaint requesting that FERC expand the order to include additional days of the weather event in February, from February 16 through February 19, 2021. On October 21, 2021, FERC denied the complaint finding that a pipeline has the discretion whether to waive penalties under its tariff, and on December 6, 2021 the related D.C. Circuit petition for review was withdrawn. During April 2021, FERC issued orders on the remaining petitions approving the requests to waive the penalties. During May 2021, an LDC filed a motion with the Kansas Corporation Commission (KCC) requesting the KCC to grant a waiver from the tariff and allow the LDC to reduce the amounts assessed by permitting the removal of a multiplier from the penalty calculation. On January 20, 2022, a unanimous settlement that was filed with the KCC that amended previously filed October 8, 2021 and November 30, 2021 nonunanimous settlements that, if approved, would resolve this matter. Exelon cannot predict the outcome of the KCC proceeding.Illinois Regulatory MattersClean Energy Law. See Clean Energy Law above for additional information related to Generation. See Note 7 – Early Plant Retirements for additional information on Generation’s Illinois nuclear plants.New Jersey Regulatory MattersNew Jersey Clean Energy Legislation. On May 23, 2018, New Jersey enacted legislation that established a ZEC program that provides compensation for nuclear plants that demonstrate to the NJBPU that they meet certain requirements, including that they make a significant contribution to air quality in the state and that their revenues are insufficient to cover their costs and risks. Under the legislation, the NJBPU will issue ZECs to qualifying nuclear power plants and the electric distribution utilities in New Jersey, including ACE, will be required to purchase those ZECs. On April 18, 2019, the NJBPU approved the award of ZECs to Salem 1 and Salem 2. Upon approval, Generation began recognizing revenue for the sale of New Jersey ZECs in the month they are generated. On March 19, 2021, a three-judge panel of the Superior Court of New Jersey Appellate Division unanimously affirmed the NJBPU’s April 2019 order awarding ZECs for the first eligibility period. On April 8, 2021, New Jersey Rate Counsel filed a notice asking the New Jersey Supreme Court to hear the appeal of the Superior Court’s order. On July 9, 2021, the New Jersey Supreme Court declined to hear the appeal. On October 1, 2020, PSEG and Generation filed applications seeking ZECs for the second eligibility period (June 2022 through May 2025). On April 27, 2021, the NJBPU approved the award of ZECs to Salem 1 and Salem 2 for the second eligibility period. On May 11, 2021, the New Jersey Rate Counsel appealed the April 27, 2021 decision to the Superior Court of New Jersey Appellate Division. Briefing on the appeal is expected to conclude in the first half of 2022. Exelon cannot reasonably predict the outcome of this proceeding. 219

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Cash and cash equivalents classified as held for sale

75

SEC-NUM

Amcor plc and SubsidiariesConsolidated Statements of Cash Flows($ in millions) | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | For the years ended June 30, | | 2022 | | 2021 | | 2020 | | Cash flows from operating activities: | | | | | | | | Net income | | $ | 815 | | | $ | 951 | | | $ | 616 | | | Adjustments to reconcile net income to net cash provided by operating activities: | | | | | | | | Depreciation, amortization, and impairment | | 625 | | | 574 | | | 652 | | | Russia and Ukraine impairment | | 138 | | | — | | | — | | | Net periodic benefit cost | | 12 | | | 15 | | | 10 | | | Amortization of debt discount and deferred financing costs | | 2 | | | 10 | | | 8 | | | | | | | | | | | Net gain on disposal of property, plant, and equipment | | (3) | | | (10) | | | (4) | | | Net gain on disposal of businesses | | — | | | (44) | | | — | | | | | | | | | | | Equity in (income)/loss of affiliated companies | | — | | | (19) | | | 14 | | | Net foreign exchange (gain)/loss | | (14) | | | 21 | | | (16) | | | Share-based compensation | | 63 | | | 58 | | | 34 | | | Other, net | | 106 | | | (83) | | | — | | | Loss from highly inflationary accounting for Argentine subsidiaries | | 22 | | | 27 | | | 38 | | | Deferred income taxes, net | | (33) | | | 4 | | | (114) | | | Dividends received from affiliated companies | | — | | | 4 | | | 7 | | | Changes in operating assets and liabilities, excluding effect of acquisitions, divestitures, and currency: | | | | | | | | Trade receivables | | (272) | | | (189) | | | 133 | | | Inventories | | (626) | | | (112) | | | 26 | | | Prepaid expenses and other current assets | | (67) | | | (90) | | | (23) | | | Trade payables | | 711 | | | 342 | | | (48) | | | Other current liabilities | | 123 | | | 11 | | | 8 | | | Accrued employee costs | | (20) | | | 29 | | | 81 | | | Employee benefit obligations | | (35) | | | (40) | | | (33) | | | Other, net | | (21) | | | 2 | | | (5) | | | Net cash provided by operating activities | | 1,526 | | | 1,461 | | | 1,384 | | | Cash flows from investing activities: | | | | | | | | Issuance of loans to affiliated companies | | (5) | | | — | | | — | | | Investments in affiliated companies and other | | (12) | | | (5) | | | — | | | | | | | | | | | Purchase of property, plant, and equipment, and other intangible assets | | (527) | | | (468) | | | (400) | | | (Payments)/proceeds from divestitures | | (1) | | | 214 | | | 425 | | | Proceeds from sales of property, plant, and equipment, and other intangible assets | | 18 | | | 26 | | | 13 | | | Net cash (used in)/provided by investing activities | | (527) | | | (233) | | | 38 | | | Cash flows from financing activities: | | | | | | | | Proceeds from issuance of shares | | 114 | | | 30 | | | 1 | | | | | | | | | | | Purchase of treasury shares | | (143) | | | (8) | | | (67) | | | Proceeds from/(purchase of) non-controlling interest | | — | | | (8) | | | 4 | | | Proceeds from issuance of long-term debt | | 1,066 | | | 790 | | | 3,194 | | | Repayment of long-term debt | | (1,243) | | | (530) | | | (4,225) | | | Net borrowing/(repayment) of commercial paper | | 638 | | | (235) | | | 1,742 | | | Net borrowing/(repayment) of short-term debt | | 15 | | | (123) | | | (585) | | | Repayment of lease liabilities | | (5) | | | (2) | | | (2) | | | Share buyback/cancellations | | (601) | | | (351) | | | (537) | | | Dividends paid | | (732) | | | (742) | | | (761) | | | Net cash used in financing activities | | (891) | | | (1,179) | | | (1,236) | | | | | | | | | | | Effect of exchange rates on cash and cash equivalents | | (108) | | | 58 | | | (45) | | | Cash and cash equivalents classified as held for sale | | (75) | | | — | | | — | | | | | | | | | | | Net increase/(decrease) in cash and cash equivalents | | (75) | | | 107 | | | 141 | | | Cash and cash equivalents balance at beginning of the fiscal year | | 850 | | | 743 | | | 602 | | | | | | | | | | | Cash and cash equivalents balance at end of the fiscal year | | $ | 775 | | | $ | 850 | | | $ | 743 | | See accompanying notes to consolidated financial statements, including Note 23, "Supplemental Cash Flow Information."52

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Payments on terminated derivative instruments

30

SEC-NUM

| | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | DENTSPLY SIRONA INC. AND SUBSIDIARIES | | | | | | | CONSOLIDATED STATEMENTS OF CASH FLOWS | | | | | | | (in millions) | Year Ended December 31, | | | 2021 | | 2020 | | 2019 | | Cash flows from operating activities: | | | | | | | | | | | | | | Net income (loss) | $ | 421 | | | $ | (83) | | | $ | 263 | | | | | | | | | | Adjustments to reconcile net income (loss) to net cash provided by operating activities: | | | | | | | Depreciation | 124 | | | 142 | | | 133 | | | Amortization of intangible assets | 222 | | | 192 | | | 190 | | | | | | | | | | Fixed asset impairment | — | | | 3 | | | 33 | | | Goodwill impairment | — | | | 157 | | | — | | | Indefinite-lived intangible asset impairment | — | | | 39 | | | 9 | | | | | | | | | | Deferred income taxes | (20) | | | (64) | | | (37) | | | Stock based compensation expense | 48 | | | 47 | | | 66 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Other non-cash (income) expense | 34 | | | 2 | | | (6) | | | | | | | | | | | | | | | | | (Gain) loss on sale on non-strategic businesses and product lines | (14) | | | 1 | | | 2 | | | | | | | | | | Changes in operating assets and liabilities, net of acquisitions: | | | | | | | Accounts and notes receivable-trade, net | (109) | | | 126 | | | (91) | | | Inventories, net | (63) | | | 124 | | | 14 | | | Prepaid expenses and other current assets, net | (35) | | | 42 | | | 13 | | | Other noncurrent assets | (10) | | | 1 | | | (9) | | | Accounts payable | (46) | | | (23) | | | 26 | | | Accrued liabilities | 78 | | | (17) | | | 45 | | | Income taxes | 17 | | | (39) | | | (16) | | | Other noncurrent liabilities | 10 | | | (15) | | | (2) | | | | | | | | | | Net cash provided by operating activities | 657 | | | 635 | | | 633 | | | | | | | | | | Cash flows from investing activities: | | | | | | | | | | | | | | Cash paid for acquisitions of businesses and equity investments, net of cash acquired | (248) | | | (1,078) | | | (3) | | | | | | | | | | Cash received on sale of non-strategic businesses or product lines | 28 | | | 1 | | | 11 | | | | | | | | | | | | | | | | | | | | | | | | Capital expenditures | (142) | | | (87) | | | (123) | | | | | | | | | | | | | | | | | Cash received on derivative contracts | 2 | | | 58 | | | 40 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Other investing activities, net | 2 | | | — | | | 6 | | | | | | | | | | Net cash used in investing activities | (358) | | | (1,106) | | | (69) | | | | | | | | | | Cash flows from financing activities: | | | | | | | | | | | | | | Proceeds from long-term borrowings, net of deferred financing costs | 16 | | | 1,448 | | | 120 | | | | | | | | | | Repayments on long-term borrowings | (297) | | | (701) | | | (251) | | | Net borrowings (repayments) on short-term borrowings | 179 | | | 2 | | | (69) | | | Payments on terminated derivative instruments | — | | | (30) | | | — | | | Proceeds from exercised stock options | 51 | | | 11 | | | 109 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Cash paid for treasury stock | (200) | | | (140) | | | (260) | | | Cash dividends paid | (92) | | | (88) | | | (81) | | | Other financing activities, net | (36) | | | (12) | | | (34) | | | | | | | | | | | | | | | | | Net cash (used in) provided by financing activities | (379) | | | 490 | | | (466) | | | | | | | | | | Effect of exchange rate changes on cash and cash equivalents | (19) | | | 14 | | | (3) | | | | | | | | | | Net (decrease) increase in cash and cash equivalents | (99) | | | 33 | | | 95 | | | | | | | | | | Cash and cash equivalents at beginning of period | 438 | | | 405 | | | 310 | | | | | | | | | | Cash and cash equivalents at end of period | $ | 339 | | | $ | 438 | | | $ | 405 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Supplemental disclosures of cash flow information: | | | | | | | Interest paid, net of amounts capitalized | $ | 64 | | | $ | 45 | | | $ | 30 | | | Income taxes paid, net of refunds | 148 | | | 82 | | | 112 | | | Non-cash investing activities: | | | | | | | Property, plant and equipment in accounts payable at end of period | $ | 33 | | | $ | 14 | | | $ | 14 | | | Exchange of inventory for naming rights | 2 | | | 4 | | | 3 | | The accompanying notes are an integral part of these consolidated financial statements.59

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Assets held for sale - area of real estate

334,144

SEC-NUM

14. NONCONTROLLING INTERESTS Noncontrolling interests represent the third-party interests in certain entities in which we have a controlling interest. These entities owned 63 properties as of September 30, 2022 and are included in our consolidated financial statements. Noncontrolling interests are adjusted for additional contributions and distributions, the proportionate share of the net earnings or losses, and other comprehensive income or loss. Distributions, profits, and losses related to these entities are allocated in accordance with the respective operating agreements. During the nine months ended September 30, 2022 and 2021, we distributed $139.5 million and $81.9 million, respectively, to our consolidated real estate joint venture partners. Certain of our noncontrolling interests have the right to require us to redeem their ownership interests in the respective entities. We classify these ownership interests in the entities as redeemable noncontrolling interests outside of total equity in our consolidated balance sheets. Redeemable noncontrolling interests are adjusted for additional contributions and distributions, the proportionate share of the net earnings or losses, and other comprehensive income or loss. If the amount of a redeemable noncontrolling interest is less than the maximum redemption value at the balance sheet date, such amount is adjusted to the maximum redemption value. Subsequent declines in the redemption value are recognized only to the extent that previous increases have been recognized. Refer to the “Formation of consolidated real estate joint ventures and sales of partial interests” section in Note 4 – “Consolidated and unconsolidated real estate joint ventures” to our unaudited consolidated financial statements for additional information. 15. ASSETS CLASSIFIED AS HELD FOR SALE As of September 30, 2022, we had one property aggregating 334,144 RSF that was classified as held for sale in our consolidated financial statements. The disposal of properties classified as held for sale does not represent a strategic shift and therefore does not meet the criteria for classification as a discontinued operation. We cease depreciation of our properties upon their classification as held for sale. Refer to the “Real estate sales” subsection of the “Investments in real estate” section within Note 2 – “Summary of significant accounting policies” for additional information. The following is a summary of net assets as of September 30, 2022 and December 31, 2021 for our real estate investments that were classified as held for sale as of each respective date (in thousands): | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | September 30, 2022 | | December 31, 2021 | | Total assets | $ | 14,169 | | | $ | 17,749 | | | Total liabilities | (1,179) | | | (1,083) | | | Total accumulated other comprehensive income (loss) | 1,839 | | | (1,750) | | | Net assets classified as held for sale | $ | 14,829 | | | $ | 14,916 | | 16. SUBSEQUENT EVENTS Real estate assets acquired in October 2022 In October 2022, we completed the acquisition of two properties for an aggregate purchase price of $108.0 million. Refer to the “Acquisitions” section in Note 3 – “Investments in real estate” for additional information.41

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Other asset impairment charges

28.9

SEC-NUM

[Table of Contents](#ic5e280ddd1ef46fe9ace2a18e7a582b7_7) Based on the quoted market prices, the approximate fair value of the notes as of January 31, 2022, were as follows: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | Aggregate Principal Amount | | Fair value | | 2012 Notes | $ | 350.0 | | | $ | 355.8 | | | 2015 Notes | 300.0 | | | 320.4 | | | 2017 Notes | 500.0 | | | 525.8 | | | 2020 Notes | 500.0 | | | 503.3 | | | 2021 Notes | 1,000.0 | | | 956.7 | | The expected future principal payments for all borrowings as of January 31, 2022, were as follows: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Fiscal year ending | | | | | | | 2023 | $ | 350.0 | | | | | | | | | 2024 | — | | | | | | | | | 2025 | — | | | | | | | | | 2026 | 300.0 | | | | | | | | | 2027 | — | | | | | | | | | Thereafter | 2,000.0 | | | | | | | | | Total principal outstanding | $ | 2,650.0 | | | | | | | | 9. Leases Autodesk has operating leases for real estate, vehicles and certain equipment. Leases have remaining lease terms of less than 1 year to 68 years, some of which include options to extend the lease with renewal terms from 1 year to 10 years and some of which include options to terminate the leases from less than 1 year to 8 years. Options to extend the lease are included in the lease liability if they are reasonably certain of being exercised. Options to terminate are considered in determining the lease liability if they are reasonably certain of being exercised. Payments under our lease arrangements are primarily fixed, however, certain lease agreements contain variable payments, which are expensed as incurred and not included in the operating lease assets and liabilities. These amounts include payments affected by the Consumer Price Index, payments for common area maintenance that are subject to annual reconciliation, and payments for maintenance and utilities. The Company’s leases do not contain residual value guarantees or material restrictive covenants. Short-term leases are recognized in the Consolidated Statement of Operations on a straight-line basis over the lease term. Short-term lease expense was not material for the periods presented. Changes in operating lease right-of-use assets and operating lease liabilities are presented net in the “accounts payable and other liabilities” line in the Consolidated Statements of Cash Flows with the exception of “Lease-related asset impairments” which is presented in “Adjustments to reconcile net income to net cash provided by operating activities”. During the fiscal year ended January 31, 2022, Autodesk vacated certain leased office facilities in connection with Autodesk’s move to a more hybrid workforce. Autodesk recorded total impairment and accelerated depreciation charges of $103.7 million, consisting of operating lease right-of-use assets of $74.8 million and computer equipment, software, furniture, and leasehold improvements of $28.9 million. Autodesk assessed the asset groupings for disaggregation based on the proposed changes in use of the facilities. For asset groups where impairment was triggered, Autodesk utilized an income approach to value the asset groups by developing discounted cash flow models. The significant assumptions used in the discounted cash flow models for each of the asset groups included projected sublease income over the remaining lease terms, expected downtime prior to the commencement of future subleases, expected lease incentives offered to future tenants, and discount rates that reflected the level of risk associated with these future cash flows. These significant assumptions are considered Level 1 and Level 2 inputs in accordance with the fair value hierarchy described in Note 1, “Business and Summary of Significant Accounting Policies.” The operating lease right-of-use assets and other lease-related assets charges are included in “general and administrative” in the Company’s Consolidated Statements of Operations. 101

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Less imputed interest

12,807

SEC-NUM

Other assets include ROU assets, other current liabilities include short-term operating lease liabilities, and other non-current liabilities include long-term lease liabilities at December 31, 2021 and 2020 is as follows (in thousands): | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | 2021 | | 2020 | | ROU assets | | $ | 84,777 | | | $ | 76,797 | | | Short term lease liabilities | | $ | 20,296 | | | $ | 17,047 | | | Long term lease liabilities | | $ | 79,905 | | | $ | 75,350 | | The Company does not recognize ROU assets and lease liabilities for short-term leases that have a term of twelve months or less. The effect of short-term leases would not be material to the ROU assets and lease liabilities.Under ASC 842, a Company discounts future lease obligations by the rate implicit in the contract, unless the rate cannot be readily determined. As most of our leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the lease commencement date in determining the present value of the lease payments. In determining the borrowing rate, the Company considered the applicable lease terms, the Company's cost of borrowing, and for leases denominated in a foreign currency, the collateralized borrowing rate that the Company would obtain to borrow in the same currency in which the lease is denominated. Total lease costs for the year ended December 31, 2021 and 2020 were $22.6 million and $20.7 million, respectively.The supplementary cash and non-cash disclosures for the year ended December 31, 2021 and 2020 are as follows (in thousands): | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | 2021 | | 2020 | | Cash paid for operating lease liabilities | | $ | 23,803 | | | $ | 20,068 | | | ROU assets obtained in exchange for new operating lease obligations | | $ | 29,428 | | | $ | 7,134 | | | Weighted-average remaining lease term (years) | | 5.99 | | 7.07 | | Weighted-average discount rate | | 3.80% | | 4.18% | Maturities of lease liabilities as of December 31, 2021 were as follows (in thousands): | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | 2022 | | $ | 1,535 | | | 2023 | | 22,924 | | | 2024 | | 20,725 | | | 2025 | | 19,101 | | | 2026 | | 16,734 | | | Thereafter | | 31,989 | | | Total lease payments | | 113,008 | | | Less imputed interest | | 12,807 | | | Present value of lease liabilities | | $ | 100,201 | | 15. Commitments and ContingenciesIn the ordinary course of business, the Company is involved in various pending or threatened legal actions, arbitration proceedings, claims, subpoenas, and matters relating to compliance with laws and regulations (collectively, "legal proceedings"). Based on our current knowledge, management presently does not believe that the liabilities arising from these legal proceedings will have a material adverse effect on our consolidated financial condition, results of operations or cash flows. However, it is possible that the ultimate resolution of these legal proceedings could have a material adverse effect on our results of operations and financial condition for any particular period.Derivative LawsuitsOn July 10, 2017, a shareholder derivative complaint was filed against the Company and certain of the Company’s directors and officers in the United States District Court for the Northern District of Georgia (“Federal Derivative Action”) seeking recovery on behalf of the Company. The Federal Derivative Action alleges that the defendants issued a false and misleading 84

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Total contractual obligations, Payments Due in Fiscal 2025

1,367

SEC-NUM

[Table of Contents](#i2ba0bd92bcb14d27a1d59d9667569d45_7)THE ESTÉE LAUDER COMPANIES INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTSNOTE 16 – COMMITMENTS AND CONTINGENCIES Contractual ObligationsThe following table summarizes scheduled maturities of the Company’s contractual obligations for which cash flows are fixed and determinable as of June 30, 2022: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Payments Due in Fiscal | | | | (In millions) | | Total | | 2023 | | 2024 | | 2025 | | 2026 | | 2027 | | Thereafter | | Debt service (1) | | $ | 8,151 | | | $ | 429 | | | $ | 170 | | | $ | 665 | | | $ | 161 | | | $ | 661 | | | $ | 6,065 | | | Unconditional purchase obligations (2) | | 4,742 | | | 2,852 | | | 705 | | | 637 | | | 132 | | | 133 | | | 283 | | | Gross unrecognized tax benefits and interest – current (3) | | 2 | | | 2 | | | — | | — | | — | | — | | — | | Transition Tax payable(4) | | 215 | | | 27 | | | 42 | | | 65 | | | 81 | | | — | | | — | | | Total contractual obligations(5) | | $ | 13,110 | | | $ | 3,310 | | | $ | 917 | | | $ | 1,367 | | | $ | 374 | | | $ | 794 | | | $ | 6,348 | | | | | | | | | | | | | | | | | | (1)Includes long-term and current debt and the related projected interest costs. Refer to Note 7 – Leases for information regarding future minimum lease payments relating to the Company’s finance leases. Interest costs on long-term and current debt in fiscal 2023, 2024, 2025, 2026, 2027 and thereafter are projected to be $174 million, $170 million, $165 million, $161 million, $161 million and $1,765 million, respectively. Projected interest costs on variable rate instruments were calculated using market rates at June 30, 2022.(2)Unconditional purchase obligations primarily include: royalty payments pursuant to license agreements, inventory commitments, information technology contract commitments, capital expenditure commitments, advertising commitments and third-party distribution commitments. Future royalty and advertising commitments were estimated based on planned future sales for the term that was in effect at June 30, 2022, without consideration for potential renewal periods.(3)Refer to Note 9 – Income Taxes for information regarding unrecognized tax benefits. As of June 30, 2022, the noncurrent portion of the Company’s unrecognized tax benefits, including related accrued interest and penalties, was $73 million. At this time, the settlement period for the noncurrent portion of the unrecognized tax benefits, including related accrued interest and penalties, cannot be determined and therefore was not included.(4)The Transition Tax may be paid over an eight-year period and this amount represents the remaining liability as of June 30, 2022.(5)Refer to Note 7 – Leases for information regarding future minimum lease payments relating to the Company’s operating leases. Legal Proceedings The Company is involved, from time to time, in litigation and other legal proceedings incidental to its business, including product liability matters (including asbestos-related claims), advertising, regulatory, employment, intellectual property, real estate, environmental, trade relations, tax and privacy. Management believes that the outcome of current litigation and legal proceedings will not have a material adverse effect upon the Company’s business, results of operations, financial condition or cash flows. However, management’s assessment of the Company’s current litigation and other legal proceedings could change in light of the discovery of facts with respect to legal actions or other proceedings pending against the Company not presently known to the Company or determinations by judges, juries or other finders of fact which are not in accord with management’s evaluation of the possible liability or outcome of such litigation or proceedings. Reasonably possible losses in addition to the amounts accrued for such litigation and legal proceedings are not material to the Company’s consolidated financial statements. F-63

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Total lease payments

315

SEC-NUM

[Table of Contents](#ie3b4dd133255408488aec6011c49b801_10)APPLIED MATERIALS, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) As of October 31, 2021, the maturities of lease liabilities are as follows: | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | Operating Leases | | Fiscal | (In millions) | | 2022 | $ | 78 | | | 2023 | 71 | | | 2024 | 61 | | | 2025 | 48 | | | 2026 | 18 | | | Thereafter | 39 | | | Total lease payments | 315 | | | Less imputed interest | (14) | | | Total | $ | 301 | | Note 13 Severance and Related ChargesFiscal 2021 Severance PlanIn the first quarter of fiscal 2021, Applied enacted a severance plan to realign its workforce. Under this plan, Applied implemented a one-time voluntary retirement program and other workforce reduction actions. The voluntary retirement program was available to certain U.S. employees who met minimum age and length of service requirements, as well as other business-specific criteria. The payments under this plan are paid at the time of termination and the related costs were not allocated to the segments. In addition, Applied implemented other workforce reduction actions globally across the Display and Adjacent Markets business. These costs were recorded under the Display and Adjacent Markets segment.During fiscal 2021, Applied recognized $157 million of severance and related charges in connection with the Fiscal 2021 Severance Plan, of which $17 million remains outstanding as of October 31, 2021. Severance and related charges by segment were as follows: | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | 2021 | | | | | | | (In millions) | | Display and Adjacent Markets | $ | 8 | | | | | | | Corporate and Other | 149 | | | | | | | Total | $ | 157 | | | | | | Changes in severance and related charges reserves related to the Fiscal 2021 Severance Plan described above were as follows: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | Severance and Related Charges Reserves | | | | | | | | | | | | | | (In millions) | | Balance as of October 25, 2020 | $ | — | | | | | | | | | Provision for severance | 158 | | | | | | | | | Adjustment to provision for severance | (1) | | | | | | | | | Consumption of reserves | (140) | | | | | | | | | Balance as of October 31, 2021 | $ | 17 | | | | | | | | 90

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Employee compensation-related shares (including stock options) (in shares)

1

SEC-NUM

| | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 2021 | 2020 | 2019 | | Compensation expense (after-tax)(a)(b) | $ | 361 | | $ | 353 | | $ | 400 | | | Cash received from stock options exercised | 93 | | 6 | | 69 | | | Intrinsic value of stock options exercised and RSU/PSUs vested | 217 | | 81 | | 154 | | (a)Unrecognized compensation cost related to unvested equity awards as of December 31, 2021 was $491 million, which will be amortized over a weighted average period of 1.1 years. (b)Income tax benefit recognized in earnings was $9 million, $10 million and $20 million in 2021, 2020, and 2019, respectively. NOTE 17. EARNINGS PER SHARE INFORMATION. In the second quarter of 2021, we announced that we would proceed with the 1-for-8 reverse stock split, as approved by shareholders, and filed an amendment to our certificate of incorporation to effectuate the reverse stock split after the close of trading on July 30, 2021. GE common stock began trading on a split-adjusted basis on August 2, 2021. Our shares of outstanding common stock and earnings per share calculation have been retroactively restated for all periods presented. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (Earnings for per-share calculation, | 2021 | | 2020 | | 2019 | | per-share amounts in dollars) | Diluted | Basic | | Diluted | Basic | | Diluted | Basic | | | | | | | | | | | | | | | | | | | Earnings from continuing operations | $ | (3,326) | | $ | (3,326) | | | $ | 6,601 | | $ | 6,601 | | | $ | (614) | | $ | (614) | | | Preferred stock dividends | (237) | | (237) | | | (474) | | (474) | | | (460) | | (460) | | | Accretion of redeemable noncontrolling interests, net of tax(a) | (9) | | (9) | | | (151) | | (151) | | | — | | — | | | Earnings from continuing operations attributable to GE common shareholders | (3,571) | | (3,571) | | | 5,975 | | 5,975 | | | (1,074) | | (1,074) | | | Earnings (loss) from discontinued operations | (3,195) | | (3,195) | | | (909) | | (909) | | | (4,367) | | (4,367) | | | Net earnings attributable to GE common shareholders | (6,766) | | (6,766) | | | 5,066 | | 5,066 | | | (5,440) | | (5,440) | | | | | | | | | | | | | Shares of GE common stock outstanding | 1,098 | | 1,098 | | | 1,094 | | 1,094 | | | 1,091 | | 1,091 | | | Employee compensation-related shares (including stock options) | — | | — | | | 1 | | — | | | — | | — | | | Total average equivalent shares | 1,098 | | 1,098 | | | 1,095 | | 1,094 | | | 1,091 | | 1,091 | | | | | | | | | | | | | Earnings (loss) from continuing operations | $ | (3.25) | | $ | (3.25) | | | $ | 5.46 | | $ | 5.46 | | | $ | (0.98) | | $ | (0.98) | | | Earnings (loss) from discontinued operations | (2.91) | | (2.91) | | | (0.83) | | (0.83) | | | (4.00) | | (4.00) | | | Net earnings (loss) | (6.16) | | (6.16) | | | 4.63 | | 4.63 | | | (4.99) | | (4.99) | | | | | | | | | | | | | Potentially dilutive securities(b) | 41 | | | | 56 | | | | 55 | | | (a) Represents accretion adjustment of redeemable noncontrolling interests in our Additive business within our Aviation segment.(b) Outstanding stock awards not included in the computation of diluted earnings per share because their effect was antidilutive. Our unvested restricted stock unit awards that contain non-forfeitable rights to dividends or dividend equivalents are considered participating securities and, therefore, are included in the computation of earnings per share pursuant to the two-class method. For the year ended December 31, 2021, as a result of the loss from continuing operations, losses were not allocated to the participating securities. For the year ended December 31, 2020, application of this treatment had an insignificant effect. For the year ended December 31, 2019, as a result of the loss from continuing operations, losses were not allocated to the participating securities. NOTE 18. OTHER INCOME | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | 2021 | 2020 | 2019 | | Purchases and sales of business interests(a) | $ | (40) | | $ | 12,468 | | $ | 3 | | | Licensing and royalty income | 192 | | 161 | | 256 | | | Equity method income | (96) | | 7 | | 264 | | | Net interest and investment income (loss)(b) | 2,270 | | (1,447) | | 1,507 | | | Other items | 497 | | 207 | | 449 | | | Total other income | $ | 2,823 | | $ | 11,396 | | $ | 2,479 | | (a)Included a pre-tax loss of $170 million on the sale of our boiler manufacturing business in China in 2021. Included a pre-tax gain of $12,362 million on the sale of BioPharma in 2020. Included a pre-tax gain of $224 million on the sale of ServiceMax partially offset by charges to the valuation allowance on businesses classified as held for sale of $245 million in 2019. See Note 2 for further information.(b)Included a pre-tax realized and unrealized gain of $938 million, pre-tax realized and unrealized loss of $2,037 million and pre-tax unrealized gain of $793 million related to our interest in Baker Hughes in 2021, 2020 and 2019, respectively. Included a pre-tax unrealized gain of $711 million related to our interest in AerCap in 2021. Included interest income associated with customer advances of $167 million, $146 million and $143 million in 2021, 2020 and 2019, respectively. See Notes 3, 8 and 24 for further information.2021 FORM 10-K 76

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Decrease in Unrecognized Tax Benefits is Reasonably Possible

5

SEC-NUM

[Table of Contents](#i5ec3aabfaa534f9c8fa2d2a5b7677d19_7) Cumulative Undistributed Foreign EarningsNo income taxes have been provided on indefinitely reinvested earnings of certain foreign subsidiaries at December 31, 2021.Withholding taxes of $65 million have been accrued on undistributed earnings that are not indefinitely reinvested and are primarily related to China, Honduras, Morocco and Germany. There are no other material liabilities for income taxes on the undistributed earnings of foreign subsidiaries, as the Company has concluded that such earnings are either indefinitely reinvested or should not give rise to additional income tax liabilities as a result of the distribution of such earnings.Uncertain Tax PositionsThe Company recognizes tax benefits only for tax positions that are more likely than not to be sustained upon examination by tax authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement. Unrecognized tax benefits are tax benefits claimed in the Company’s tax returns that do not meet these recognition and measurement standards.A reconciliation of the gross change in the unrecognized tax benefits balance, excluding interest and penalties is as follows: | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | Year Ended December 31, | | | 2021 | | 2020 | | 2019 | | | (in millions) | | Balance at beginning of year | $ | 231 | | | $ | 217 | | | $ | 209 | | | | | | | | | | Additions related to current year | 12 | | | 35 | | | 20 | | | Additions related to prior years | 20 | | | 31 | | | 51 | | | Reductions related to prior years | (36) | | | (20) | | | (46) | | | Reductions due to expirations of statute of limitations | (3) | | | (28) | | | (11) | | | Settlements | — | | | (4) | | | (6) | | | | | | | | | | Balance at end of year | $ | 224 | | | $ | 231 | | | $ | 217 | | A portion of the Company’s unrecognized tax benefits would, if recognized, reduce its effective tax rate. The remaining unrecognized tax benefits relate to tax positions that, if recognized, would result in an offsetting change in valuation allowance and for which only the timing of the benefit is uncertain. Recognition of these tax benefits would reduce the Company’s effective tax rate only through a reduction of accrued interest and penalties. As of December 31, 2021 and 2020, the amounts of unrecognized tax benefit that would reduce the Company’s effective tax rate were $207 million and $213 million, respectively. For the year ended December 31, 2019, the Company recorded approximately $26 million of additional reserves for uncertain tax positions, primarily related to prior year net operating loss and other carryforwards on which full valuation allowances have been recorded. For 2021 and 2020, respectively, $105 million and $103 million of reserves for uncertain tax positions would be offset by the write-off of a related deferred tax asset, if recognized.The Company recognizes interest and penalties relating to unrecognized tax benefits as part of income tax expense. Total accrued liabilities for interest and penalties were $28 million and $25 million at December 31, 2021 and 2020, respectively. Total interest and penalties recognized as part of income tax expense were expenses of $4 million, $13 million and $7 million for the years ended December 31, 2021, 2020 and 2019, respectively.The Company files tax returns in multiple jurisdictions and is subject to examination by taxing authorities throughout the world. Taxing jurisdictions significant to Aptiv include Barbados, China, Germany, Ireland, Luxembourg, Mexico, South Korea, the U.K. and the U.S. Open tax years related to these taxing jurisdictions remain subject to examination and could result in additional tax liabilities. In general, the Company’s affiliates are no longer subject to income tax examinations by foreign tax authorities for years before 2002. It is reasonably possible that audit settlements, the conclusion of current examinations or the expiration of the statute of limitations in several jurisdictions could impact the Company’s unrecognized tax benefits. A reversal of approximately $5 million is reasonably possible in the next 12 months, due to the running of statutes of limitations in various taxing jurisdictions. 98

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Total

20,837,246

SEC-NUM

5. LEASESRefer to the “Lease accounting” section in Note 2 – “Summary of significant accounting policies” to our unaudited consolidated financial statements for information about lease accounting standards that set principles for the recognition, measurement, presentation, and disclosure of leases for both parties to a lease agreement (i.e., lessees and lessors). Leases in which we are the lessor As of September 30, 2022, we had 431 properties aggregating 41.1 million operating RSF located in key clusters, including Greater Boston, the San Francisco Bay Area, New York City, San Diego, Seattle, Maryland, and Research Triangle. We focus on developing Class A properties in AAA innovation cluster locations, which we consider to be highly desirable for tenancy by life science, agtech, and technology entities. Such locations are generally characterized by high barriers to entry for new landlords, high barriers to exit for tenants, and a limited supply of available space. As of September 30, 2022, all leases in which we are the lessor were classified as operating leases, with the exception of one direct financing lease. Our leases are described below. Operating leases As of September 30, 2022, our 431 properties were subject to operating lease agreements. Two of these properties, representing two land parcels, are subject to lease agreements that each contain an option for the lessee to purchase the underlying asset from us at fair market value during each of the 30-day periods commencing on the dates that are 15 years, 30 years, and 74.5 years after the rent commencement date of October 1, 2017. The remaining lease term related to each of the two land parcels is 70.2 years. Our leases generally contain options to extend lease terms at prevailing market rates at the time of expiration. Certain operating leases contain early termination options that require advance notification and payment of a penalty, which in most cases is substantial enough to be deemed economically disadvantageous by a tenant to exercise. Future lease payments to be received under the terms of our operating lease agreements, excluding expense reimbursements, in effect as of September 30, 2022 are outlined in the table below (in thousands): | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | Year | | Amount | | 2022 | | $ | 413,509 | | | 2023 | | 1,743,452 | | | 2024 | | 1,831,621 | | | 2025 | | 1,816,651 | | | 2026 | | 1,771,008 | | | Thereafter | | 13,261,005 | | | Total | | $ | 20,837,246 | | Refer to Note 3 – “Investments in real estate” to our unaudited consolidated financial statements for additional information about our owned real estate assets, which are the underlying assets under our operating leases. Direct financing and sales-type leases As of September 30, 2022, we had one direct financing lease agreement, with a net investment balance of $39.2 million, for a parking structure with a remaining lease term of 70.2 years. The lessee has an option to purchase the underlying asset at fair market value during each of the 30-day periods commencing on the dates that are 15 years, 30 years, and 74.5 years after the rent commencement date of October 1, 2017. The components of our aggregate net investment in our direct financing and sales-type leases as of September 30, 2022 and December 31, 2021 are summarized in the table below (in thousands): | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | September 30, 2022 | | December 31, 2021 | | Gross investment in direct financing and sales-type leases | $ | 255,641 | | | $ | 403,388 | | | Add: estimated unguaranteed residual value of the underlying assets | — | | | 31,839 | | | Less: unearned income on direct financing lease | (213,640) | | | (215,557) | | | Less: effect of discounting on sales-type leases | — | | | (146,175) | | | Less: allowance for credit losses | (2,839) | | | (2,839) | | | Net investment in direct financing and sales-type leases | $ | 39,162 | | | $ | 70,656 | | In May 2022, we completed the sale of land at 9609, 9613, and 9615 Medical Center Drive in our Rockville submarket, which was subject to long-term sales-type leases, for the sales price of $47.8 million and recognized a gain of $11.9 million classified in gain on sales of real estate within our unaudited consolidated statements of operations for the nine months ended September 30, 2022. As of September 30, 2022, we had no sales-type leases. 27

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Preliminary adjustment for excess cash balances remaining

202

SEC-NUM

[Table of Conten](#i207805ce14724a60909000a6c8cb9e11_7)[t](#i207805ce14724a60909000a6c8cb9e11_7)[s](#i207805ce14724a60909000a6c8cb9e11_7)Acquisitions SummaryThe following summarizes the estimated fair values of the assets acquired and liabilities assumed for all acquisitions consummated during the years ended December 31. Balances presented for 2020 and 2019 reflect final measurement period adjustments ($ in millions): | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | 2021 | | 2020 | | 2019 | | Accounts receivable | $ | 49.8 | | | $ | 0.1 | | | $ | 44.1 | | | Inventories | $ | 11.5 | | | 26.9 | | | 186.9 | | | Property, plant and equipment | $ | 5.2 | | | 5.0 | | | 54.3 | | | Goodwill | $ | 1,840.8 | | | 30.9 | | | 2,220.3 | | | Other intangible assets, primarily customer relationships, trade names and technology | $ | 929.4 | | | 9.5 | | | 1,659.5 | | | Prepaid acquisition asset related to ASP Non-Principal Countries | $ | — | | | — | | | 34.7 | | | Trade accounts payable | $ | (10.4) | | | (1.1) | | | (7.5) | | | Other assets and liabilities, net | $ | (256.2) | | | (41.8) | | | (287.3) | | | Net cash consideration | $ | 2,570.1 | | | $ | 29.5 | | | $ | 3,905.0 | | NOTE 4. DISCONTINUED OPERATIONS AND DISPOSITIONS Vontier SeparationOn October 9, 2020, we completed the Vontier Separation, by distributing 80.1% of the outstanding shares of Vontier to Fortive stockholders on a pro rata basis. To effect the Separation, we distributed to our stockholders two shares of Vontier common stock for every five shares of our common stock outstanding held on September 25, 2020, the record date for the distribution. We retained 19.9% of the shares of Vontier common stock immediately following the Separation (the “Retained Vontier Shares”).On September 29, 2020, Vontier entered into a credit agreement (the “Credit Agreement”) with a syndicate of banks, consisting of a three-year, $800 million senior unsecured delayed draw term loan facility (the “Three-Year Term Loans”), a two-year, $1 billion senior unsecured delayed draw term loan facility (the “Two-Year Term Loans” and together with the Three-Year Term Loans, the “Term Loans”) and a three-year, $750 million senior unsecured multi-currency revolving credit facility (the “Revolving Credit Facility” and, together with the Term Loans, the “Credit Facilities”). On the Distribution Date, Vontier drew down the full $1.8 billion available under the Term Loans. Vontier used the proceeds from the Term Loans to make payments to the Company, with $1.6 billion used as part of the consideration for the contribution of certain assets and liabilities to Vontier by the Company in connection with the Separation and $202 million used as an adjustment for excess cash balances remaining with Vontier (collectively, the “Cash Consideration”). We applied the Cash Consideration to repay certain outstanding indebtedness, interest on certain debt instruments, and to pay certain of the Company’s regular, quarterly cash dividends. Refer to Note 11 for the description of the debt repayments made subsequent to the Distribution Date. Interest expense and extinguishment costs related to the debt retired during the fourth quarter of 2020 using the Cash Consideration was allocated to discontinued operations for all periods presented.The accounting requirements for reporting the Vontier business as a discontinued operation were met when the Vontier Separation was completed. Accordingly, the consolidated financial statements reflect the results of the Vontier business as a discontinued operation for all periods presented.On January 19, 2021, we completed the Debt-for-Equity Exchange of 33.5 million shares of common stock of Vontier, representing all of the Retained Vontier Shares, for $1.1 billion in aggregate principal amount of indebtedness of the Company held by Goldman Sachs & Co., including (i) all $400.0 million of the Term Loan due March 2021 and (ii) $683.2 million of the Term Loan due May 2021. We recorded a loss on extinguishment of the debt included in the Debt-for-Equity Exchange of $94.4 million in the year ended December 31, 2021. 69

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Finance Lease, Liability, to be Paid, Year One

1.2

SEC-NUM

| | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | March 31, 2022 | December 31, 2021 | | | | | | Weighted Average Remaining Lease Term | | | | Operating leases - in years | 7 | 8 | | Finance leases - in years | 15 | 15.5 | | | | | | Weighted Average Discount Rate | | | | Operating leases | 3.1 | % | 3.3 | % | | Finance leases | 6.2 | % | 6.3 | % | Maturities of lease liabilities were as follows (in millions): | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Year Ending December 31, | Operating Leases | | Finance Leases | | | | | | | 2022 (excluding the three months ended March 31, 2022) | $ | 31.6 | | | $ | 1.2 | | | 2023 | 39.6 | | | 1.2 | | | 2024 | 33.1 | | | 1.1 | | | 2025 | 29.7 | | | 1.1 | | | 2026 | 24.4 | | | 1.1 | | | Thereafter | 76.6 | | | 12.7 | | | Total lease payments | 235.0 | | | 18.4 | | | Less imputed interest | (28.5) | | | (7.5) | | | Total | $ | 206.5 | | | $ | 10.9 | | The value of our operating lease portfolio is principally for facilities with longer durations than the lesser value vehicles, and other equipment with shorter terms and higher-turn over. As of March 31, 2022, operating leases that have not commenced are not material. Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThis discussion should be read in conjunction with the information contained in both our consolidated financial statements for the year ended December 31, 2021 and the condensed consolidated financial statements for the three and nine months ended March 31, 2022. Overview. We are a multinational manufacturer and worldwide distributor of our own life science research and clinical diagnostics products. Our business is organized into two reportable segments, Life Science and Clinical Diagnostics, with the mission to provide scientists with specialized tools needed for biological research and health care specialists with products needed for clinical diagnostics. We sell more than 12,000 products and services to a diverse client base comprised of scientific research, healthcare, education and government customers worldwide. We do not disclose quantitative information about our different products and services as it is impractical to do so based primarily on the numerous products and services that we sell and the global markets that we serve. We manufacture and supply our customers with a range of reagents, apparatus and equipment to separate complex chemical and biological materials and to identify, analyze and purify components. As our customers require standardization for their experiments and test results, much of our revenues are recurring in nature.

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