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Operating Lease, Payments

36.9

SEC-NUM

INDIANA MICHIGAN POWER COMPANY AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWSFor the Six Months Ended June 30, 2022 and 2021 (in millions)(Unaudited) | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Six Months Ended June 30, | | | | 2022 | | 2021 | | OPERATING ACTIVITIES | | | | | | Net Income | | $ | 156.7 | | | $ | 128.0 | | | Adjustments to Reconcile Net Income to Net Cash Flows from Operating Activities: | | | | | | Depreciation and Amortization | | 268.6 | | | 218.1 | | | Rockport Plant, Unit 2 Operating Lease Amortization | | — | | | 33.9 | | | Deferred Income Taxes | | 0.3 | | | (8.2) | | | Deferral of Incremental Nuclear Refueling Outage Expenses, Net | | (38.3) | | | (14.3) | | | | | | | | | | | | | | | Allowance for Equity Funds Used During Construction | | (5.4) | | | (7.0) | | | Mark-to-Market of Risk Management Contracts | | (11.6) | | | (3.1) | | | Amortization of Nuclear Fuel | | 39.0 | | | 40.4 | | | | | | | | | Deferred Fuel Over/Under-Recovery, Net | | (17.5) | | | (5.7) | | | Change in Other Noncurrent Assets | | 3.3 | | | 11.7 | | | Change in Other Noncurrent Liabilities | | 22.2 | | | 26.2 | | | Changes in Certain Components of Working Capital: | | | | | | Accounts Receivable, Net | | 24.0 | | | (0.4) | | | Fuel, Materials and Supplies | | 4.5 | | | 27.1 | | | | | | | | | Accounts Payable | | 13.6 | | | 16.4 | | | | | | | | | Accrued Taxes, Net | | (2.4) | | | (5.3) | | | | | | | | | Rockport Plant, Unit 2 Operating Lease Payments | | — | | | (36.9) | | | Other Current Assets | | 15.2 | | | 2.0 | | | Other Current Liabilities | | (20.1) | | | (29.1) | | | Net Cash Flows from Operating Activities | | 452.1 | | | 393.8 | | | | | | | | | INVESTING ACTIVITIES | | | | | | Construction Expenditures | | (262.5) | | | (241.0) | | | Change in Advances to Affiliates, Net | | (1.0) | | | (86.6) | | | Purchases of Investment Securities | | (1,253.2) | | | (1,149.7) | | | Sales of Investment Securities | | 1,229.9 | | | 1,122.7 | | | Acquisitions of Nuclear Fuel | | (67.7) | | | (63.0) | | | | | | | | | Other Investing Activities | | 3.0 | | | 4.5 | | | Net Cash Flows Used for Investing Activities | | (351.5) | | | (413.1) | | | | | | | | | FINANCING ACTIVITIES | | | | | | | | | | | | Capital Contribution from Parent | | 1.3 | | | — | | | Issuance of Long-term Debt – Nonaffiliated | | 72.8 | | | 507.0 | | | Change in Advances from Affiliates, Net | | (42.8) | | | (103.0) | | | Retirement of Long-term Debt – Nonaffiliated | | (40.7) | | | (282.7) | | | Principal Payments for Finance Lease Obligations | | (40.1) | | | (3.3) | | | Dividends Paid on Common Stock | | (50.0) | | | (100.0) | | | Other Financing Activities | | 0.4 | | | 0.5 | | | Net Cash Flows from (Used for) Financing Activities | | (99.1) | | | 18.5 | | | | | | | | | Net Increase (Decrease) in Cash and Cash Equivalents | | 1.5 | | | (0.8) | | | Cash and Cash Equivalents at Beginning of Period | | 1.3 | | | 3.3 | | | Cash and Cash Equivalents at End of Period | | $ | 2.8 | | | $ | 2.5 | | | | | | | | | SUPPLEMENTARY INFORMATION | | | | | | Cash Paid for Interest, Net of Capitalized Amounts | | $ | 59.2 | | | $ | 52.2 | | | Net Cash Paid (Received) for Income Taxes | | (4.9) | | | 4.1 | | | Noncash Acquisitions Under Finance Leases | | 0.4 | | | 2.8 | | | Construction Expenditures Included in Current Liabilities as of June 30, | | 68.2 | | | 59.9 | | | | | | | | | | | | | | | | | | | | | See Condensed Notes to Condensed Financial Statements of Registrants beginning on page [138](#i06a79327713d4f6ab4e79d7445380253_346). | 102

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Receivables, net of allowances

194

SEC-NUM

[Table of Contents](#i210a9c6b74ef4ff89c48a86e24b71d45_7) Humana Inc.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)(Unaudited)3. ACQUISITIONS AND DIVESTITURES On August 11, 2022, we completed the sale of a 60% interest of Humana’s Kindred at Home Hospice subsidiary, or KAH Hospice, to Clayton, Dubilier & Rice, or CD&R, for cash proceeds of approximately $2.7 billion, net of cash disposed, including debt repayments from KAH Hospice to Humana of $1.9 billion. In connection with the sale we recognized a pre-tax gain, net of transaction costs, of $240 million which is reported as a gain on sale of KAH Hospice in the accompanying condensed consolidated statements of income for the three and nine months ended September 30, 2022. In June 2022, we classified KAH Hospice as held-for-sale and aggregated KAH Hospice’s assets and liabilities separately on the balance sheet. The assets, liabilities and noncontrolling interest disposed of on August 11, 2022 were as follows: | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | August 11, 2022 | | | (in millions) | | Assets | | | Cash and cash equivalents | $ | 66 | | | Receivables, net of allowances | 194 | | | Other current assets | 20 | | | Property and equipment, net | 44 | | | Goodwill | 2,331 | | | Other assets | 960 | | | Total assets | $ | 3,615 | | | Liabilities | | | Trade accounts payable and accrued expenses | $ | 245 | | | Other long-term liabilities | 281 | | | Total liabilities | $ | 526 | | | Noncontrolling interest | $ | 11 | | Other assets included $866 million identifiable intangibles consisting of Medicare licenses and certificates of need. Prior to the KAH Hospice disposition on August 11, 2022, as discussed above, KAH Hospice revenues for the three and nine months ended September 30, 2022 were $177 million and $958 million, respectively. Prior to the KAH Hospice disposition on August 11, 2022, KAH Hospice pretax earnings for the three and nine months ended September 30, 2022 were $24 million and $150 million, respectively. On August 17, 2021, we acquired the remaining 60% interest in Kindred at Home, or KAH, the nation’s largest home health and hospice provider, from TPG Capital, or TPG, and Welsh, Carson, Anderson & Stowe, or WCAS, two private equity funds for an enterprise value of $8.2 billion, which included our equity value of $2.4 billion associated with our 40% minority ownership interest. We paid the approximate $5.8 billion transaction price (net of our existing equity stake) through a combination of debt financing, the assumption of existing KAH indebtedness and parent company cash. During 2022 and 2021, we acquired various health and wellness related businesses which, individually or in the aggregate, have not had a material impact on our results of operations, financial condition, or cash flows. The results of operations and financial condition of these businesses acquired in 2022 and 2021 have been included in our condensed consolidated statements of income and condensed consolidated balance sheets from the respective acquisition dates. Acquisition-related costs recognized in 2022 and 2021 were not material to our results of operations. For asset acquisitions, the goodwill acquired is partially amortizable as deductible expenses for tax purposes. The pro forma financial information assuming the acquisitions had occurred as of the beginning of the 12

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Excess assets for U.S. Pension Plan

20.2

SEC-NUM

[Table of Contents](#i3d0ebbc4e2a2420f98ed7e6fe698936a_7) HASBRO, INC. AND SUBSIDIARIESNotes to Consolidated Financial Statements — (Continued) In February 2018, the Compensation Committee of the Company’s Board of Directors approved a resolution to terminate the Company’s U.S. defined benefit pension plan (“U.S. Pension Plan”). During the first quarter of 2018 the Company commenced the U.S. Pension Plan termination process and received regulatory approval during the fourth quarter of 2018. During the second quarter of 2019, the Company settled all remaining benefits directly with vested participants electing a lump sum payout, and purchased a group annuity contract from Massachusetts Mutual Life Insurance Company to administer all future payments to remaining U.S. Pension Plan participants. The U.S. Pension Plan's net funded asset position was sufficient to cover the lump sum payments and the purchase of the group annuity contract and settle all other remaining benefit obligations with no additional cost to the Company. After the settlement of the benefit obligations and payment of expenses, the Company had excess assets in the U.S. Pension Plan of approximately $20.2 million. The Company elected to utilize the remaining surplus after payment of administrative expenses for the Company's future matching contributions under the Company's 401(k) plan. The Company made a transfer of $19.5 million to the Company’s 401(k) plan which occurred in February 2020, with the remainder transferred in November 2021. Upon settlement of the pension liability, which occurred in May 2019, the Company recognized a non-operating settlement charge of $110.8 million, with an additional settlement charge of $0.2 million in December 2019, related to pension losses, reclassified from accumulated other comprehensive loss to other (income) expense in the Company's consolidated statements of operations, adjusted for market conditions and settlement costs at benefit distribution.During 2020, the Company merged its employee retirement agreements, which had beginning benefit liabilities of $14.8 million, with its remaining US pension plans. At December 26, 2021, the measurement date, the Company's remaining plans were unfunded with an aggregate accumulated and projected benefit obligation of $41.6 million. The Company also provides certain postretirement health care and life insurance benefits to eligible employees who retired prior to January 1, 2020 and have either attained age 65 with 5 years of service or age 55 with 10 years of service. The cost of providing these benefits on behalf of employees who retired prior to 1993 has been substantially borne by the Company. The cost of providing benefits to all eligible employees who retire after 1992 is borne by the employee. The plan is not funded. During the fourth quarter of 2019, with the approval of the Compensation Committee of the Company's Board of Directors, the Company announced the elimination of the contributory postretirement health and life insurance coverage for employees whose retirement eligibility begins after December 31, 2019.As of December 26, 2021, the Company had unrecognized losses related to its remaining U.S. pension and post retirement plans of $17.1 million. 114

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Divested balances

351

SEC-NUM

[Table of Contents](#i89c3c9328e454b30b2c14123b867f3f0_7)EQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Changes in the valuation allowance for deferred tax assets for the years ended December 31, 2021, 2020 and 2019 are as follows (in thousands): | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | 2021 | | 2020 | | 2019 | | Beginning balance | $ | 82,344 | | | $ | 57,812 | | | $ | 57,003 | | | Amounts from acquisitions | 964 | | | 5,777 | | | (2,707) | | | Divested balances | — | | | — | | | (351) | | | Amounts recognized into income | 595 | | | (390) | | | 2,870 | | | Current increase | 19,539 | | | 15,044 | | | 697 | | | Impact of foreign currency exchange | (2,696) | | | 4,101 | | | 300 | | | Ending balance | $ | 100,746 | | | $ | 82,344 | | | $ | 57,812 | | Our NOL carryforwards for federal, state and foreign tax purposes which expire, if not utilized, at various intervals from 2022, are outlined below (in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Expiration Date | | Federal (1) | | State | | Foreign (2) (3) | | Total | | 2022 | | $ | 20,808 | | | $ | — | | | $ | 754 | | | $ | 21,562 | | | 2023 to 2025 | | 26,838 | | | 112 | | | 25,876 | | | 52,826 | | | 2026 to 2028 | | 12,186 | | | — | | | 12,560 | | | 24,746 | | | 2029 to 2031 | | — | | | 767 | | | 32,849 | | | 33,616 | | | 2032 to 2034 | | 394 | | | 822 | | | — | | | 1,216 | | | 2035 to 2037 | | 6,739 | | | 2,491 | | | 3,838 | | | 13,068 | | | Thereafter | | 437,683 | | | 80,613 | | | 488,897 | | | 1,007,193 | | | | | $ | 504,648 | | | $ | 84,805 | | | $ | 564,774 | | | $ | 1,154,227 | | | | | | | --- | --- | --- | | | | | | | (1)The total amount of NOL carryforwards that will not be available to offset our future taxable income after the dividends paid deduction due to Section 382 limitations was $56.7 million for federal.(2)In certain jurisdictions, the net operating loss carryforwards can only be used to offset a percentage of taxable income in a given year. (3)If certain substantial changes in the entity's ownership occur or have determined to have occurred, there may be a limitation on the amount of the carryforwards that can be utilized.As of December 31, 2021, we had tax credit carryforwards of $7.2 million, which expire, if not utilized, from 2022 to 2031. We also had capital losses of $8.0 million, which can be carried forward indefinitely.The beginning and ending balances of our unrecognized tax benefits are reconciled below for the years ended December 31 (in thousands): | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | 2021 | | 2020 | | 2019 | | Beginning balance | $ | 207,759 | | | $ | 173,726 | | | $ | 150,930 | | | Gross increases related to prior year tax positions | 4,547 | | | 14,732 | | | — | | | Gross decreases related to prior year tax positions | (58,356) | | | — | | | (1,160) | | | Gross increases related to current year tax positions | 10,000 | | | 29,149 | | | 31,332 | | | Decreases resulting from expiration of statute of limitation | (10,561) | | | (6,518) | | | (2,112) | | | Decreases resulting from settlements | (5,089) | | | (3,330) | | | (5,264) | | | Ending balance | $ | 148,300 | | | $ | 207,759 | | | $ | 173,726 | | We recognize interest and penalties related to unrecognized tax benefits within income tax expense in the consolidated statements of operations. We accrued $13.6 million, $21.3 million, and $14.2 million for interest and penalties as of December 31, 2021, 2020 and 2019, respectively.F-56

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Vested (in shares)

152

SEC-NUM

| | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | [Table of Contents](#i091a03213a4e4cb7a2bb5f39154aefe4_7) | Alphabet Inc. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Nine Months Ended September 30, | | | 2021 | | 2022 | | | Class A | | Class B | | Class C | | Class A | | Class B | | Class C | | Basic net income per share: | | | | | | | | | | | | | Numerator | | | | | | | | | | | | | Allocation of undistributed earnings | $ | 24,867 | | | $ | 3,776 | | | $ | 26,748 | | | $ | 21,213 | | | $ | 3,137 | | | $ | 21,998 | | | | | | | | | | | | | | | | Denominator | | | | | | | | | | | | | Number of shares used in per share computation | 6,010 | | | 912 | | | 6,464 | | | 6,004 | | | 888 | | | 6,226 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Basic net income per share | $ | 4.14 | | | $ | 4.14 | | | $ | 4.14 | | | $ | 3.53 | | | $ | 3.53 | | | $ | 3.53 | | | Diluted net income per share: | | | | | | | | | | | | | Numerator | | | | | | | | | | | | | | | | | | | | | | | | | | Allocation of undistributed earnings for basic computation | $ | 24,867 | | | $ | 3,776 | | | $ | 26,748 | | | $ | 21,213 | | | $ | 3,137 | | | $ | 21,998 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Reallocation of undistributed earnings as a result of conversion of Class B to Class A shares | 3,776 | | | 0 | | | 0 | | | 3,137 | | | 0 | | | 0 | | | Reallocation of undistributed earnings | (424) | | | (56) | | | 424 | | | (204) | | | (26) | | | 204 | | | Allocation of undistributed earnings | $ | 28,219 | | | $ | 3,720 | | | $ | 27,172 | | | $ | 24,146 | | | $ | 3,111 | | | $ | 22,202 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Denominator | | | | | | | | | | | | | Number of shares used in basic computation | 6,010 | | | 912 | | | 6,464 | | | 6,004 | | | 888 | | | 6,226 | | | Weighted-average effect of dilutive securities | | | | | | | | | | | | | Add: | | | | | | | | | | | | | Conversion of Class B to Class A shares outstanding | 912 | | | 0 | | | 0 | | | 888 | | | 0 | | | 0 | | | | | | | | | | | | | | | | Restricted stock units and other contingently issuable shares | 0 | | | 0 | | | 202 | | | 0 | | | 0 | | | 111 | | | Number of shares used in per share computation | 6,922 | | | 912 | | | 6,666 | | | 6,892 | | | 888 | | | 6,337 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Diluted net income per share | $ | 4.08 | | | $ | 4.08 | | | $ | 4.08 | | | $ | 3.50 | | | $ | 3.50 | | | $ | 3.50 | | For the periods presented above, the net income per share amounts are the same for Class A, Class B, and Class C stock because the holders of each class are entitled to equal per share dividends or distributions in liquidation in accordance with the Amended and Restated Certificate of Incorporation of Alphabet Inc.Note 12. Compensation PlansStock-Based CompensationFor the three months ended September 30, 2021 and 2022, total stock-based compensation (SBC) expense was $3.9 billion and $5.0 billion, including amounts associated with awards we expect to settle in Alphabet stock of $3.8 billion and $4.8 billion, respectively. For the nine months ended September 30, 2021 and 2022, total SBC expense was $11.7 billion and $14.4 billion, including amounts associated with awards we expect to settle in Alphabet stock of $11.2 billion and $13.8 billion, respectively. Stock-Based Award ActivitiesThe following table summarizes the activities for unvested Alphabet restricted stock units (RSUs) for the nine months ended September 30, 2022 (in millions, except per share amounts): | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | Unvested Restricted Stock Units | | | Number ofShares | | Weighted-AverageGrant-DateFair Value | | Unvested as of December 31, 2021 | 338 | | | $ | 81.31 | | | Granted | 199 | | | $ | 131.77 | | | Vested | (152) | | | $ | 87.13 | | | Forfeited/canceled | (25) | | | $ | 96.04 | | | Unvested as of September 30, 2022 | 360 | | | $ | 105.70 | | As of September 30, 2022, there was $35.7 billion of unrecognized compensation cost related to unvested RSUs. This amount is expected to be recognized over a weighted-average period of 2.7 years. 31

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Operating Lease, Liability

99

SEC-NUM

millions): | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | Fiscal Year Ended June 30, 2022 | | Cash paid for amounts included in lease liabilities: | | | | | Financing cash flows used for finance leases | | | $ | 15 | | | Operating cash flows used for finance leases | | | 11 | | | Operating cash flows used for operating leases | | | 19 | | | | | | | | Non-cash transactions: | | | | | Right-of-use assets obtained in exchange for new finance lease liabilities | | | 59 | | | Right-of-use assets obtained in exchange for new operating lease liabilities | | | $ | 31 | | As of June 30, 2022, the Company expects that its future minimum lease payments will become due and payable as follows: | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | (Dollars in millions) | Financing Leases | | Operating Leases | | Total | | 2023 | $ | 29 | | | $ | 17 | | | $ | 46 | | | 2024 | 28 | | | 14 | | | 42 | | | 2025 | 25 | | | 11 | | | 36 | | | 2026 | 22 | | | 11 | | | 33 | | | 2027 | 22 | | | 11 | | | 33 | | | Thereafter | 238 | | | 74 | | | 312 | | | Total minimum lease payments | 364 | | | 138 | | | 502 | | | Less: interest | 130 | | | 39 | | | 169 | | | Total lease liabilities | $ | 234 | | | $ | 99 | | | $ | 333 | | 17. COMMITMENTS AND CONTINGENCIESContingent LossesFrom time to time, the Company may be involved in legal proceedings arising in the ordinary course of business, including, without limitation, inquiries and claims concerning environmental contamination as well as litigation and allegations in connection with acquisitions, product liability, manufacturing or packaging defects, and claims for reimbursement for the cost of lost or damaged active pharmaceutical ingredients, the cost of any of which could be significant. The Company intends to vigorously defend itself against any such litigation and does not currently believe that the outcome of any such litigation will have a material adverse effect on the Company’s financial statements. In addition, the healthcare industry is highly regulated and government agencies continue to scrutinize certain practices affecting government programs and otherwise.From time to time, the Company receives subpoenas or requests for information relating to the business practices and activities of customers or suppliers from various governmental agencies or private parties, including from state attorneys general, the U.S. Department of Justice, and private parties engaged in patent infringement, antitrust, tort, and other litigation. The Company generally responds to such subpoenas and requests in a timely and thorough manner, which responses sometimes require considerable time and effort and can result in considerable costs being incurred. The Company expects to incur costs in future periods in connection with future requests.18. SEGMENT AND GEOGRAPHIC INFORMATIONAs discussed in Note 1, Basis of Presentation and Summary of Significant Accounting Policies, the Company conducted its business within the following segments in fiscal 2022: Biologics, Softgel and Oral Technologies, Oral and Specialty Delivery, and Clinical Supply Services. The Company evaluates the performance of its segments based on segment earnings before other (income) expense, impairments, restructuring costs, interest expense, income tax expense, and depreciation and amortization (“Segment EBITDA”). Segment EBITDA is subject to important limitations as it is not defined under U.S. GAAP and is not a measure of operating income, operating performance, or liquidity presented in accordance with U.S. GAAP. These consolidated financial 114

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Unrecognized tax benefits that would reduce the valuation allowance if recognized

33.6

SEC-NUM

[Table of Contents](#ic5e280ddd1ef46fe9ace2a18e7a582b7_7) As of January 31, 2022, Autodesk had $41.0 million of cumulative U.S. federal tax loss carryforwards and $585.4 million of cumulative U.S. state tax loss carryforwards, which may be available to reduce future income tax liabilities in federal and state jurisdictions. The pre-fiscal 2019 U.S. federal tax loss carryforward will expire beginning fiscal 2035 through fiscal 2039. U.S. federal losses generated beginning in fiscal 2019 do not expire and are carried forward indefinitely. The U.S. state tax loss carryforward will expire beginning fiscal 2025 through fiscal 2042. In addition to U.S. federal and state tax loss carryforwards, the Netherlands, Norway, Singapore, and other foreign jurisdictions incurred tax losses totaling $164.0 million, which may be available to reduce future income tax liabilities. Our Norway and Singapore losses, of $28.7 million and $85.2 million, respectively, have an indefinite expiration period. The Netherlands losses of $41.3 million will expire beginning in fiscal 2026 through fiscal 2028, and have a full valuation allowance against them on our balance sheet as the Company has determined it is more likely than not that these losses will not be utilized. As of January 31, 2022, Autodesk had $190.8 million of cumulative U.S. federal research tax credit carryforwards, $106.5 million of cumulative California state research tax credit carryforwards, and $49.2 million and $1.4 million of cumulative Canadian federal research and Ontario minimum tax credit carryforwards, respectively, which may be available to reduce future income tax liabilities in the respective jurisdictions. The federal research tax credit carryforwards will expire beginning fiscal 2026 through fiscal 2042, the state research tax credit carryforwards may reduce future California income tax liabilities indefinitely, and the Canadian research tax credit carryforwards will expire beginning fiscal 2030 through fiscal 2042. Autodesk also has $119.3 million of cumulative U.S. federal foreign tax credit carryforwards, which may be available to reduce future U.S. tax liabilities. These foreign tax credits will expire beginning fiscal 2025 through fiscal 2032. As discussed above, the California and Canada cumulative assets have full valuation allowance against them on our balance sheet as the Company has determined it is more likely than not that these losses and credits will not be utilized. Utilization of net operating losses and tax credits may be subject to an annual limitation due to ownership change limitations provided in the Internal Revenue Code and similar state provisions. This annual limitation may result in the expiration of net operating losses and credits before utilization. No ownership change has occurred through the balance sheet date that would result in permanent losses of the U.S. federal and state tax attributes. As of January 31, 2022, the Company had $206.7 million of gross unrecognized tax benefits, of which $33.6 million would reduce our valuation allowance, if recognized. The remaining $173.1 million would impact the effective tax rate. It is possible that the amount of unrecognized tax benefits will decrease in the next 12 months for an audit settlement of approximately $7.8 million. A reconciliation of the beginning and ending amount of the gross unrecognized tax benefits is as follows: | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | Fiscal Year Ended January 31, | | | 2022 | | 2021 | | 2020 | | Gross unrecognized tax benefits at the beginning of the fiscal year | $ | 198.0 | | | $ | 220.6 | | | $ | 209.0 | | | Increases for tax positions of prior years | 9.0 | | | 12.7 | | | 2.8 | | | Decreases for tax positions of prior years | (6.6) | | | (41.1) | | | (0.4) | | | Increases for tax positions related to the current year | 6.7 | | | 6.4 | | | 11.1 | | | Decreases relating to settlements with taxing authorities | — | | | — | | | — | | | Reductions as a result of lapse of the statute of limitations | (0.4) | | | (0.6) | | | (1.9) | | | Gross unrecognized tax benefits at the end of the fiscal year | $ | 206.7 | | | $ | 198.0 | | | $ | 220.6 | | It is the Company’s continuing practice to recognize interest and/or penalties related to income tax matters in income tax expense. Autodesk had $6.5 million, $4.5 million, and $2.3 million, net of tax benefit, accrued for interest and penalties related to unrecognized tax benefits as of January 31, 2022, 2021, and 2020, respectively. There was $2.1 million, $2.2 million, and $(0.8) million of net expense for interest and penalties related to tax matters recorded through the consolidated statements of operations for the years ended January 31, 2022, 2021, and 2020, respectively. Autodesk’s U.S. and state income tax returns for fiscal 2002 through fiscal 2022 remain open to examination due to either net operating loss or credit carryforward. The Internal Revenue Service notified the Company of examination of the Company’s consolidated federal income tax returns for fiscal 2020 and 2021. This audit commenced in February, 2022. 96

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Capacity Of Facility Of Company Owned Solar Distribution Generation Facilities

360

SEC-NUM

[Table of Contents](#i59ca7ab3cc784e42904d434b0008a7a9_10)Notes to Consolidated Financial Statements(Dollars in millions, unless otherwise noted) Note 2 — Mergers, Acquisitions, and DispositionsThe following table summarizes the effects of the changes in our ownership interest in CENG in Members Equity: | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | For the Year Ended December 31, 2021 | | Net loss attributable to membership interest | | | | $ | (205) | | | Pre-tax increase in membership interest for purchase of EDF's 49.99% equity interest(a) | | | | 1,080 | | | Decrease in membership interest due to deferred tax liabilities resulting from purchase of EDF's 49.99% equity interest(a) | | | | (288) | | | Change from net loss attributable to membership interest and transfers from noncontrolling interest | | | | $ | 587 | | \_\_\_\_\_\_\_\_\_\_(a)Represents non-cash activity in the consolidated financial statements.Agreement for Sale of Our Solar Business On December 8, 2020, we entered into an agreement with an affiliate of Brookfield Renewable, for the sale of a significant portion of our solar business, including 360 MW of generation in operation or under construction across more than 600 sites across the United States. We will retain certain solar assets not included in this agreement, primarily Antelope Valley. Completion of the transaction contemplated by the sale agreement was subject to the satisfaction of several closing conditions that were satisfied in the first quarter of 2021. The sale was completed on March 31, 2021 for a purchase price of $810 million. We received cash proceeds of $675 million, net of $125 million long-term debt assumed by the buyer and certain working capital and other post-closing adjustments. We recognized a pre-tax gain of $68 million which is included in Gain on sales of assets and businesses in the Consolidated Statement of Operations and Comprehensive Income.See Note 17 — Debt and Credit Agreements for additional information on the SolGen nonrecourse debt included as part of the transaction.Agreement for Sale of Our Biomass FacilityOn April 28, 2021, we entered into a purchase agreement with ReGenerate, under which ReGenerate agreed to purchase our interest in the Albany Green Energy biomass facility. As a result, in the second quarter of 2021, we recorded a pre-tax impairment charge of $140 million in Operating and maintenance expense in the Consolidated Statement of Operations and Comprehensive Income. Completion of the transaction was subject to the satisfaction of various customary closing conditions that were satisfied in the second quarter of 2021. The sale was completed on June 30, 2021 for a net purchase price of $36 million. Disposition of Oyster Creek On July 31, 2018, we entered into an agreement with Holtec and its indirect wholly owned subsidiary, OCEP, for the sale and decommissioning of Oyster Creek located in Forked River, New Jersey, which permanently ceased generation operations on September 17, 2018. Completion of the transaction contemplated by the sale agreement was subject to the satisfaction of several closing conditions, including approval of the license transfer from the NRC and other regulatory approvals, and a private letter ruling from the IRS, which were satisfied in the second quarter of 2019. The sale was completed on July 1, 2019. We recognized a loss on the sale in the third quarter of 2019, which was immaterial.Under the terms of the transaction, we transferred to OCEP substantially all the assets associated with Oyster Creek, including assets held in NDT funds, along with the assumption of liability for all responsibility for the site, including full decommissioning and ongoing management of the SNF until it is moved offsite. The terms of the transaction also include various forms of performance assurance for the obligations of OCEP to timely complete the required decommissioning, including a parental guaranty from Holtec for all performance and payment obligations of OCEP, and a requirement for Holtec to deliver a letter of credit to us upon the occurrence of specified events. 94

string

Percentage of shares operated

62

SEC-NUM

[Table of Contents](#i31241139a24240ee889881d54ce4b5f1_7)Diamondback Energy, Inc. and Subsidiaries Condensed Notes to Consolidated Financial Statements - (Continued)(Unaudited) Williston Basin Divestiture On October 21, 2021, the Company completed the divestiture of its Williston Basin oil and natural gas assets, consisting of approximately 95,000 net acres, to Oasis Petroleum Inc., for net cash proceeds of approximately $586 million, after customary closing adjustments. This transaction did not result in a significant alteration of the relationship between the Company’s capitalized costs and proved reserves and, accordingly, the Company recorded the proceeds as a reduction of its full cost pool with no gain or loss recognized on the sale. The Company used its net proceeds from this transaction toward debt reduction. 2021 Drop Down Transaction On December 1, 2021, Diamondback completed the sale of certain water midstream assets to Rattler in exchange for cash proceeds of approximately $164 million, including post-closing adjustments, in a drop down transaction (the “Drop Down”). The midstream assets consist primarily of produced water gathering and disposal systems, produced water recycling facilities, and sourced water gathering and storage assets acquired by the Company through the Guidon Acquisition and the QEP Merger with a carrying value of approximately $164 million. The Company and Rattler have also mutually agreed to amend their commercial agreements covering produced water gathering and disposal and sourced water gathering services to add certain Diamondback leasehold acreage to Rattler’s dedication. The Drop Down transaction was accounted for as a transaction between entities under common control. Viper’s Swallowtail Acquisition On October 1, 2021, Viper acquired certain mineral and royalty interests from the Swallowtail entities pursuant to a definitive purchase and sale agreement for 15.25 million of Viper’s common units and approximately $225 million in cash (the “Swallowtail Acquisition”). The mineral and royalty interests acquired in the Swallowtail Acquisition represent approximately 2,313 net royalty acres primarily in the Northern Midland Basin, of which approximately 62% are operated by Diamondback as of December 31, 2021. The Swallowtail Acquisition had an effective date of August 1, 2021. The cash portion of this transaction was funded through a combination of Viper’s cash on hand and approximately $190 million of borrowings under Viper LLC’s revolving credit facility. 5. PROPERTY AND EQUIPMENT Property and equipment includes the following as of the dates indicated: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | June 30, | | December 31, | | | 2022 | | 2021 | | | (In millions) | | Oil and natural gas properties: | | | | | Subject to depletion | $ | 26,103 | | | $ | 24,418 | | | Not subject to depletion | 8,097 | | | 8,496 | | | Gross oil and natural gas properties | 34,200 | | | 32,914 | | | Accumulated depletion | (6,019) | | | (5,434) | | | Accumulated impairment | (7,954) | | | (7,954) | | | Oil and natural gas properties, net | 20,227 | | | 19,526 | | | Midstream assets | 1,139 | | | 1,076 | | | Other property, equipment and land | 190 | | | 174 | | | Accumulated depreciation, amortization, accretion and impairment | (187) | | | (157) | | | Total property and equipment, net | $ | 21,369 | | | $ | 20,619 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Under the full cost method of accounting, the Company is required to perform a ceiling test each quarter which determines a limit, or ceiling, on the book value of proved oil and natural gas properties. No impairment expense was recorded for the three and six months ended June 30, 2022 or 2021 based on the results of the respective quarterly ceiling tests. 13

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Trading Symbol

CUSIP—718507BK1

SEC-NUM

| | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549FORM 10-Q(Mark One) | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | ☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | For the quarterly period ended June 30, 2022or | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | ☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | For the transition period from \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ to \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_Commission file number: 001-32395ConocoPhillips(Exact name of registrant as specified in its charter) | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | Delaware | 01-0562944 | | | | (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | | 925 N. Eldridge Parkway, Houston, TX 77079(Address of principal executive offices) (Zip Code)281-293-1000(Registrant's telephone number, including area code)Securities registered pursuant to Section 12(b) of the Act: | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | Title of each class | Trading symbols | Name of each exchange on which registered | | Common Stock, $.01 Par Value | COP | New York Stock Exchange | | 7% Debentures due 2029 | CUSIP—718507BK1 | New York Stock Exchange | Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐Emerging growth company ☐If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒The registrant had 1,273,033,365 shares of common stock, $.01 par value, outstanding at June 30, 2022.

string

Corridor approach percentage

10

SEC-NUM

| | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | Year Ended December 31, | | | 2021 | | 2020 | | 2019 | | Interest cost | $ | 14 | | | $ | 22 | | | $ | 28 | | | Estimated return on plan assets | (19) | | | (25) | | | (31) | | | Amortization of loss | 6 | | | 5 | | | 3 | | | Aggregate pension expense | $ | 1 | | | $ | 2 | | | $ | — | | We use a market-related value of plan assets when determining the estimated return on plan assets. Gains/losses on plan assets are amortized over a four-year period and accumulate in other comprehensive income. We recognize deferred gains and losses in future net income based on a “corridor” approach, where the corridor is equal to 10% of the greater of the benefit obligation or the market-related value of plan assets at the beginning of the year.The following shows the projected payments for the pension plan based on actuarial assumptions (in millions): | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | 2022 | $ | 49 | | | 2023 | 50 | | | 2024 | 49 | | | 2025 | 50 | | | 2026 | 49 | | | Next 5 years | 238 | | Supplemental Executive Retirement PlanWe have a U.S. nonqualified supplemental executive retirement plan, or SERP, which provides supplemental retirement benefits for certain employees. The future benefit accrual of the SERP plan is frozen. To provide for the future payments of these benefits, we have purchased insurance on the lives of certain of the participants through company-owned policies. As of December 31, 2021 and 2020, the cash surrender value of such policies was $61 million and $60 million, respectively, and is included in other non-current assets in the accompanying consolidated balance sheets. We also acquired a SERP through both the ICE NGX and CHX acquisitions. The following table provides a summary of the changes in the SERP benefit obligations (in millions): | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | As of December 31, | | | 2021 | | 2020 | | Change in benefit obligation: | | | | | Benefit obligation at beginning of year | $ | 38 | | | $ | 41 | | | | | | | | Interest cost | 1 | | | 1 | | | Actuarial (gain) loss | (1) | | | 1 | | | Benefits paid | (5) | | | (5) | | | Benefit obligation at year end | $ | 33 | | | $ | 38 | | | Funded status | $ | (33) | | | $ | (38) | | | Amounts recognized in the accompanying consolidated balance sheets: | | | | | Other current liabilities | $ | (4) | | | $ | (5) | | | Accrued employee benefits | (29) | | | (33) | | SERP plan expense in the accompanying consolidated statements of income was $1 million each year in 2021, 2020 and 2019 and primarily consisted of interest cost. The following table shows the projected payments for the SERP plan based on the actuarial assumptions (in millions): | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | Projected SERP Plan Payments | | | 2022 | $ | 4 | | | 2023 | 4 | | | 2024 | 3 | | | 2025 | 3 | | | 2026 | 3 | | | Next 5 years | 10 | | 135

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Shares available under the program to purchase outstanding common stock (in shares)

10

SEC-NUM

[Table of Contents](#ifb4765332bfb410ba6ce53d196f7d99d_7)Intangible AssetsThe Company held finite-lived intangible assets, including customer relationships and other intangible assets prior to the sale of HOS during the fourth quarter of 2021. All of the Company’s finite-lived intangible assets were sold as part of the HOS sale transaction. As a result, there was no gross carrying value or net book value of customer relationships and other intangible assets remaining as of December 31, 2021. The gross carrying value of customer relationships and other intangible assets as of December 31, 2020 was $78 million and $13 million, respectively. Accumulated amortization of customer relationships and other intangible assets was $29 million and $7 million, respectively, as of December 31, 2020. Intangible asset amortization expense amounted to $9 million, $12 million and $14 million for the years ended December 31, 2021, 2020 and 2019, respectively. Amortization expense related to customer relationships and other intangible assets was $7 million and $2 million, respectively, for the year ended December 31, 2021.Note 10: Shareholders’ EquityCommon StockUnder the Company’s dividend reinvestment and direct stock purchase plan (the “DRIP”), shareholders may reinvest cash common stock dividends and purchase additional shares of Company common stock, up to certain limits, through the plan administrator without paying brokerage commissions. Shares purchased by participants through the DRIP may be newly issued shares, treasury shares, or at the Company’s election, shares purchased by the plan administrator in the open market or in privately negotiated transactions. Purchases generally will be made and credited to DRIP accounts once each week. As of December 31, 2021, there were approximately 5.1 million shares available for future issuance under the DRIP.Anti-dilutive Stock Repurchase ProgramIn February 2015, the Company’s Board of Directors authorized an anti-dilutive stock repurchase program, which allows the Company to purchase up to 10 million shares of its outstanding common stock from time to time over an unrestricted period of time. The Company did not repurchase shares of common stock during the years ended December 31, 2021 and 2020. As of December 31, 2021, there were 5.1 million shares of common stock available for purchase under the program.Accumulated Other Comprehensive LossPresented in the table below are the changes in accumulated other comprehensive loss by component, net of tax, for the years ended December 31, 2021 and 2020: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Defined Benefit Plans | | Gain (Loss) on Cash Flow Hedge | | Accumulated Other Comprehensive Loss | | | Employee Benefit Plan Funded Status | | Amortization of Prior Service Cost | | Amortization of Actuarial Loss | | | | Beginning balance as of January 1, 2020 | $ | (94) | | | $ | 1 | | | $ | 60 | | | $ | (3) | | | $ | (36) | | | Other comprehensive income (loss) before reclassification | (12) | | | — | | | — | | | (4) | | | (16) | | | Amounts reclassified from accumulated other comprehensive loss | — | | | — | | | 3 | | | — | | | 3 | | | Net other comprehensive income (loss) | (12) | | | — | | | 3 | | | (4) | | | (13) | | | Ending balance as of December 31, 2020 | $ | (106) | | | $ | 1 | | | $ | 63 | | | $ | (7) | | | $ | (49) | | | Other comprehensive income (loss) before reclassification | (1) | | | — | | | — | | | 1 | | | — | | | Amounts reclassified from accumulated other comprehensive loss | — | | | — | | | 4 | | | — | | | 4 | | | Net other comprehensive income (loss) | (1) | | | — | | | 4 | | | 1 | | | 4 | | | Ending balance as of December 31, 2021 | $ | (107) | | | $ | 1 | | | $ | 67 | | | $ | (6) | | | $ | (45) | | The Company does not reclassify the amortization of defined benefit pension cost components from accumulated other comprehensive loss directly to net income in its entirety, as a portion of these costs have been deferred as a regulatory asset. These accumulated other comprehensive loss components are included in the computation of net periodic pension cost. See Note 16—Employee Benefits for additional information.The amortization of the gain (loss) on cash flow hedges is reclassified to net income during the period incurred and is included in interest, net in the accompanying Consolidated Statements of Operations.108

string

Penalty Paid to the US Treasury

80

SEC-NUM

[Table of Contents](#i6e014264141e49cfb6088f287bb6e6ad_13)second quarter of 2022, which would allow the case to proceed with discovery on a classwide basis under Canadian law. The preliminary certification decision has been appealed.Securities class action. The Company and certain officers have also been named as defendants in a putative class action pending in the MDL alleging violations of certain federal securities laws in connection with statements and alleged omissions in securities filings relating to our information security standards and practices. The complaint seeks certification of a class of all persons who purchased or otherwise acquired Capital One securities from July 23, 2015 to July 29, 2019, as well as unspecified monetary damages, costs and other relief. The court granted the Company’s motion to dismiss in September 2022. Governmental inquiries. We have received inquiries and requests for information relating to the Cybersecurity Incident from Congress, federal regulators, relevant Canadian regulators, the Department of Justice, and the offices of approximately fourteen state Attorneys General. We have cooperated with these offices and responded to their inquiries. In August 2020, we entered into consent orders with the Federal Reserve and the Office of the Comptroller of the Currency (“OCC”) resulting from regulatory reviews of the Cybersecurity Incident and relating to ongoing enhancements of our cybersecurity and operational risk management processes. We paid an $80 million penalty to the U.S. Treasury as part of the OCC agreement. The Federal Reserve agreement did not contain a monetary penalty. The OCC lifted its consent order on August 31, 2022.Taxi Medallion Finance InvestigationsBeginning in 2019, we have received subpoenas from the New York Attorney General’s office and from the U.S. Attorney’s Office for the Southern District of New York, Civil and Criminal Divisions, relating to investigations of the taxi medallion finance industry we exited beginning in 2015. The subpoenas seek, among other things, information regarding our lending counterparties and practices. We have cooperated with these investigations.U.K. PPI LitigationIn the U.K., we previously sold payment protection insurance (“PPI”). For several years leading up to the claims submission deadline of August 29, 2019 (as set by the U.K. Financial Conduct Authority), we received customer complaints and regulatory claims relating to PPI. COEP has materially resolved the PPI complaints and regulatory claims received prior to the deadline. Some of the claimants in the U.K. PPI regulatory claims process have subsequently initiated legal proceedings, seeking additional redress. We are responding to these proceedings as we receive them.Other Pending and Threatened LitigationIn addition, we are commonly subject to various pending and threatened legal actions relating to the conduct of our normal business activities. In the opinion of management, the ultimate aggregate liability, if any, arising out of all such other pending or threatened legal actions is not expected to be material to our consolidated financial position or our results of operations. | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | 125 | Capital One Financial Corporation (COF) |

string

Options canceled (in dollars per share)

9.55

SEC-NUM

[Table of Contents](#ie5b53d08516744208c4d15ed88453ce2_7)of 9,140,912 shares to the shares available for issuance under the 2014 Plan, as adjusted to give effect to the Stock Split. In fiscal 2020, in connection with our acquisition of Awake Security, we assumed the stock options outstanding under the Awake Security 2014 Equity Incentive Plan and registered an additional 461,352 shares to be available for future issuance, as adjusted to give effect to the Stock Split. As of December 31, 2021, there remained approximately 88.0 million shares available for issuance under the 2014 Plan. In February, 2022, our board of directors authorized an increase of 9,230,434 shares to shares available for future issuance under the 2014 Plan effective January 1, 2022.2014 Employee Stock Purchase PlanIn April 2014, the board of directors and stockholders approved the 2014 Employee Stock Purchase Plan (the “ESPP”). The ESPP became effective on the first day that our common stock was publicly traded. The number of shares reserved for issuance under the ESPP increases automatically on January 1 of each year by the number of shares equal to 1% of our shares outstanding immediately preceding December 31, but not to exceed 10,000,000 shares, unless the board of directors, in its discretion, determines to make a smaller increase. Effective January 1, 2021, our board of directors authorized an increase of 3,046,968 shares as adjusted to give effect to the Stock Split to shares available for issuance under the ESPP. As of December 31, 2021, there remained 18.0 million shares available for issuance under the ESPP. In February, 2022, our board of directors authorized an increase of 3,076,811 shares to shares available for issuance under the ESPP effective January 1, 2022.Under our ESPP, eligible employees are permitted to acquire shares of our common stock at 85% of the lower of the fair market value of our common stock on the first trading day of each offering period or on the exercise date. Each offering period lasts approximately two years starting on the first trading date after February 15 and August 15 of each year. Participants may purchase shares of common stock through payroll deductions up to 10% of their eligible compensation, subject to Internal Revenue Service mandated purchase limits. During the year ended December 31, 2021, we issued 458,284 shares at an average purchase price of $46.50 under our ESPP, as adjusted to give effect to the Stock Split. Stock Option ActivitiesThe following table summarizes the option activities and related information, as adjusted to give effect to the Stock Split (in thousands, except years and per share amounts): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Number of Shares UnderlyingOutstanding Options | | Weighted- Average Exercise Price per Share | | Weighted- Average Remaining Contractual Term (In Years) | | Aggregate Intrinsic Value | | Balance—December 31, 2020 | | 13,719 | | | $ | 11.29 | | | 3.6 | | $ | 841,659 | | | Options granted | | — | | | — | | | | | | | Options exercised | | (4,941) | | | 9.30 | | | | | | | Options canceled | | (93) | | | 9.55 | | | | | | | Balance—December 31, 2021 | | 8,685 | | | $ | 12.45 | | | 2.8 | | $ | 1,140,369 | | | Vested and exercisable—December 31, 2021 | | 6,650 | | | $ | 9.70 | | | 2.4 | | $ | 891,466 | | We did not grant any stock options in the year ended December 31, 2021. The weighted-average grant-date fair value of options granted during the years ended December 31, 2020 and 2019 was $46.24 and $26.86 per share, respectively, as adjusted to give effect to the Stock Split. The aggregate intrinsic value of options exercised during the years ended December 31, 2021, 2020 and 2019 was $410.9 million, $245.9 million and $323.1 million, respectively. The total fair value of options vested for the years ended December 31, 2021, 2020 and 2019 was approximately $25.3 million, $20.0 million and $23.0 million, respectively.94

string

Realized gains

0.2

SEC-NUM

[Table of Contents](#ie9658fba2baf4e3799b1175f69eaed46_7)BIOGEN INC. AND SUBSIDIARIESNOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(unaudited, continued) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | As of December 31, 2021 | | (In millions) | | AmortizedCost | | GrossUnrealizedGains | | GrossUnrealizedLosses | | FairValue | | Marketable debt securities | | | | | | | | | | Corporate debt securities: | | | | | | | | | | Current | | $ | 723.6 | | | $ | 0.1 | | | $ | (0.3) | | | $ | 723.4 | | | Non-current | | 385.4 | | | 0.2 | | | (0.8) | | | 384.8 | | | Government securities: | | | | | | | | | | Current | | 817.0 | | | — | | | (0.4) | | | 816.6 | | | Non-current | | 377.0 | | | 0.1 | | | (1.0) | | | 376.1 | | | Mortgage and other asset backed securities: | | | | | | | | | | Current | | 1.1 | | | — | | | — | | | 1.1 | | | Non-current | | 131.8 | | | — | | | (0.7) | | | 131.1 | | | Total marketable debt securities | | $ | 2,435.9 | | | $ | 0.4 | | | $ | (3.2) | | | $ | 2,433.1 | | | | | | | | | | | | | Marketable equity securities | | | | | | | | | | Marketable equity securities, current | | $ | 33.9 | | | $ | 9.9 | | | $ | — | | | $ | 43.8 | | | Marketable equity securities, non-current | | 1,133.1 | | | 151.0 | | | (279.4) | | | 1,004.7 | | | Total marketable equity securities | | $ | 1,167.0 | | | $ | 160.9 | | | $ | (279.4) | | | $ | 1,048.5 | | Summary of Contractual Maturities: Available-for-Sale Debt SecuritiesThe estimated fair value and amortized cost of our marketable debt securities available-for-sale by contractual maturity are summarized as follows: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | As of March 31, 2022 | | As of December 31, 2021 | | (In millions) | | EstimatedFair Value | | AmortizedCost | | EstimatedFair Value | | AmortizedCost | | Due in one year or less | | $ | 2,002.4 | | | $ | 2,006.0 | | | $ | 1,541.1 | | | $ | 1,541.7 | | | Due after one year through five years | | 982.9 | | | 993.7 | | | 868.2 | | | 870.2 | | | Due after five years | | 18.7 | | | 19.3 | | | 23.8 | | | 24.0 | | | Total marketable debt securities | | $ | 3,004.0 | | | $ | 3,019.0 | | | $ | 2,433.1 | | | $ | 2,435.9 | | The average maturity of our marketable debt securities available-for-sale as of March 31, 2022 and December 31, 2021, was approximately 10 months.Proceeds from Marketable Debt SecuritiesThe proceeds from maturities and sales of marketable debt securities and resulting realized gains and losses are summarized as follows: | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | For the Three Months Ended March 31, | | | | (In millions) | | 2022 | | 2021 | | | | | | Proceeds from maturities and sales | | $ | 543.6 | | | $ | 819.2 | | | | | | | Realized gains | | — | | | 0.2 | | | | | | | Realized losses | | 0.6 | | | 0.7 | | | | | | Realized losses for the three months ended March 31, 2022 and 2021, primarily relate to sales of corporate bonds, agency mortgage-backed securities and other asset-backed securities.21

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Operating loss carryforwards subject to expire by fiscal 2027

1.8

SEC-NUM

| | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | PART II | ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA | Table of Contents | Significant components of deferred tax assets (liabilities) consist of the following: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | February 28,2022 | | February 28,2021 | | (in millions) | | | | | Deferred tax assets | | | | | Intangible assets | $ | 2,188.8 | | | $ | 1,852.0 | | | Loss carryforwards | 349.8 | | | 233.1 | | | Stock-based compensation | 22.9 | | | 30.1 | | | Lease liabilities | 69.0 | | | 83.1 | | | Inventory | 51.8 | | | 26.6 | | | | | | | | | | | | | | | | | | | | | | | Investments in unconsolidated investees | 541.0 | | | 36.7 | | | Other accruals | 67.8 | | | 33.7 | | | Gross deferred tax assets | 3,291.1 | | | 2,295.3 | | | Valuation allowances | (552.1) | | | (78.6) | | | Deferred tax assets, net | 2,739.0 | | | 2,216.7 | | | | | | | | Deferred tax liabilities | | | | | Intangible assets | (522.1) | | | — | | | Property, plant, and equipment | (186.0) | | | (200.3) | | | Investments in unconsolidated investees | (58.9) | | | — | | | Provision for unremitted earnings | (26.0) | | | (23.0) | | | | | | | | | | | | | | | | | | Right-of-use assets | (59.8) | | | (70.6) | | | Other accruals | (50.5) | | | — | | | Total deferred tax liabilities | (903.3) | | | (293.9) | | | Deferred tax assets (liabilities), net | $ | 1,835.7 | | | $ | 1,922.8 | | In assessing the realizability of deferred tax assets, we consider whether it is more likely than not that some or all of the deferred tax assets will not be realized. In making this assessment, we consider the projected reversal of deferred tax liabilities and projected future taxable income as well as tax planning strategies. Based upon this assessment, we believe it is more likely than not that we will realize the benefits of these deductible differences, net of any valuation allowances. As of February 28, 2022, operating loss carryforwards, which are primarily state and foreign, totaling $3.2 billion are being carried forward in a number of jurisdictions where we are permitted to use tax operating losses from prior periods to reduce future taxable income. Of these operating loss carryforwards, $1.8 billion will expire by fiscal 2029, $900.0 million will expire between fiscal 2030 and fiscal 2042, and $500.0 million may be carried forward indefinitely in certain jurisdictions. We have recognized valuation allowances for operating loss carryforwards and other deferred tax assets when we believe it is more likely than not that these items will not be realized. The increase in our valuation allowances as of February 28, 2022, primarily related to the unrealized net gain (loss) from changes in fair value of our investment in Canopy and Canopy equity in earnings (losses). | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | Constellation Brands, Inc. FY 2022 Form 10-K | #WORTHREACHINGFOR I 98 |

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Proceeds from short-term borrowings, net

13.5

SEC-NUM

AMERICAN TOWER CORPORATION AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(in millions) | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Nine Months Ended September 30, | | | | 2022 | | 2021 | | CASH FLOWS FROM OPERATING ACTIVITIES | | | | | | Net income | | $ | 2,413.3 | | | $ | 2,126.4 | | | Adjustments to reconcile net income to cash provided by operating activities | | | | | | Depreciation, amortization and accretion | | 2,540.4 | | | 1,688.7 | | | Stock-based compensation expense | | 138.1 | | | 98.0 | | | Loss on early retirement of long-term obligations | | 0.4 | | | 25.7 | | | Other non-cash items reflected in statements of operations | | (1,112.2) | | | (340.8) | | | Increase in net deferred rent balances | | (350.4) | | | (324.3) | | | Right-of-use asset and Operating lease liability, net | | 0.6 | | | 13.9 | | | Changes in unearned revenue | | (710.9) | | | 995.1 | | | Increase in assets | | (309.3) | | | (201.6) | | | (Decrease) increase in liabilities | | (98.8) | | | 59.9 | | | Cash provided by operating activities | | 2,511.2 | | | 4,141.0 | | | CASH FLOWS FROM INVESTING ACTIVITIES | | | | | | Payments for purchase of property and equipment and construction activities | | (1,215.4) | | | (916.7) | | | Payments for acquisitions, net of cash acquired | | (359.1) | | | (9,595.3) | | | | | | | | | Proceeds from sale of short-term investments and other non-current assets | | 16.0 | | | 13.8 | | | Payment for investments in equity securities | | — | | | (25.0) | | | Deposits and other | | 52.3 | | | (1.3) | | | Cash used for investing activities | | (1,506.2) | | | (10,524.5) | | | CASH FLOWS FROM FINANCING ACTIVITIES | | | | | | Proceeds from short-term borrowings, net | | 13.5 | | | — | | | Borrowings under credit facilities | | 3,500.0 | | | 7,666.9 | | | Proceeds from issuance of senior notes, net | | 1,293.6 | | | 5,609.4 | | | Proceeds from term loans | | — | | | 2,347.0 | | | | | | | | | | | | | | | Repayments of notes payable, credit facilities, senior notes, secured debt, term loans and finance leases | | (8,595.7) | | | (10,752.8) | | | Distributions to noncontrolling interest holders | | (3.2) | | | (223.1) | | | | | | | | | Contributions from noncontrolling interest holders | | 2,548.5 | | | 3,078.2 | | | | | | | | | Proceeds from stock options and employee stock purchase plan | | 21.0 | | | 60.4 | | | Distributions paid on common stock | | (1,945.9) | | | (1,674.4) | | | | | | | | | Proceeds from the issuance of common stock, net | | 2,291.7 | | | 2,361.8 | | | | | | | | | Payment for early retirement of long-term obligations | | — | | | (61.9) | | | Deferred financing costs and other financing activities | | (84.0) | | | (126.2) | | | Purchase of redeemable noncontrolling interest | | — | | | (2.5) | | | | | | | | | Cash (used for) provided by financing activities | | (960.5) | | | 8,282.8 | | | Net effect of changes in foreign currency exchange rates on cash and cash equivalents, and restricted cash | | (138.2) | | | (61.4) | | | NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS, AND RESTRICTED CASH | | (93.7) | | | 1,837.9 | | | CASH AND CASH EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF PERIOD | | 2,343.3 | | | 1,861.4 | | | CASH AND CASH EQUIVALENTS, AND RESTRICTED CASH, END OF PERIOD | | $ | 2,249.6 | | | $ | 3,699.3 | | | CASH PAID FOR INCOME TAXES (NET OF REFUNDS OF $7.1 AND $35.2, RESPECTIVELY) | | $ | 244.5 | | | $ | 121.1 | | | CASH PAID FOR INTEREST | | $ | 852.5 | | | $ | 576.9 | | | NON-CASH INVESTING AND FINANCING ACTIVITIES: | | | | | | Purchases of property and equipment under finance leases and perpetual easements | | $ | 19.4 | | | $ | 42.2 | | | Decrease in accounts payable and accrued expenses for purchases of property and equipment and construction activities | | $ | (26.5) | | | $ | (0.4) | | | Settlement of third-party debt | | $ | — | | | $ | (9.0) | | | | | | | | | | | | | | | | | | | | See accompanying notes to unaudited consolidated and condensed consolidated financial statements. 4

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Increase (decrease) in plan assets

1,198

SEC-NUM

| | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | FINANCIAL STATEMENTS | EMPLOYEE BENEFIT PLANS | 15. EMPLOYEE BENEFIT PLANSDEFINED BENEFIT RETIREMENT PLANSDuke Energy and certain subsidiaries maintain, and the Subsidiary Registrants participate in, qualified and non-qualified, non-contributory defined benefit retirement plans. Duke Energy's policy is to fund amounts on an actuarial basis to provide assets sufficient to meet benefit payments to be paid to plan participants.The following table includes information related to the Duke Energy Registrants' contributions to its qualified defined benefit pension plans. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Nine Months Ended September 30, 2022 | | | | | Duke | | | Duke | | Duke | | Duke | | Duke | | | | | Duke | | Energy | | Progress | Energy | | Energy | | Energy | | Energy | | | | (in millions) | Energy | | Carolinas | | Energy | Progress | | Florida | | Ohio | | Indiana | | Piedmont | | Contributions made | $ | 58 | | | $ | 15 | | | $ | 13 | | $ | 8 | | | $ | 5 | | | $ | 3 | | | $ | 5 | | | $ | 2 | | Duke Energy uses a December 31 measurement date for its qualified non-contributory defined benefit retirement plan assets and obligations. However, because Duke Energy believes it is probable in 2022 that total lump-sum benefit payments will exceed the settlement threshold, which is defined as the sum of the service cost and interest cost on projected benefit obligation components of net periodic pension costs, Duke Energy remeasured the plan assets and plan obligations associated with one of its qualified pension plans as of September 30, 2022. The discount rate used for the remeasurement was 5.7% as of September 30, 2022. The cash balance interest crediting rate was 4.5% as of September 30, 2022. The interest rate for lump sum and annuity conversions was updated to reflect current market conditions. All other assumptions used for the September 30, 2022, remeasurement were consistent with the measurement as of December 31, 2021.As a result of the remeasurement, Duke Energy recognized a remeasurement loss of $276 million, of which $266 million was recorded in Regulatory Assets within Other Noncurrent Assets and $10 million was recorded in Accumulated Other Comprehensive Loss within the Condensed Consolidated Balance Sheets as of September 30, 2022. The remeasurement loss, which represents a decrease in funded status, reflects a decrease of $1,198 million in the fair value of plan assets and a decrease of $922 million in the projected benefit obligation. As the result of settlement accounting, Duke Energy recognized settlement charges of $66 million, of which $55 million was recorded to Regulatory Assets within Other Noncurrent Assets on the Condensed Consolidated Balance Sheets and $11 million was recorded to Other Income and Expenses, net, within the Condensed Consolidated Statement of Operations as of September 30, 2022. Settlement charges recognized by the Subsidiary Registrants as of September 30, 2022, were $28 million for Duke Energy Carolinas, $16 million for Duke Energy Progress, $5 million for Duke Energy Florida, $4 million for Duke Energy Indiana, $2 million for Duke Energy Ohio and $11 million for Piedmont. QUALIFIED PENSION PLANSThe following tables include the components of net periodic pension costs for qualified pension plans. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended September 30, 2022 | | | | | Duke | | | | Duke | | Duke | | Duke | | Duke | | | | | Duke | | Energy | | Progress | | Energy | | Energy | | Energy | | Energy | | | | (in millions) | Energy | | Carolinas | | Energy | | Progress | | Florida | | Ohio | | Indiana | | Piedmont | | Service cost | $ | 39 | | | $ | 12 | | | $ | 11 | | | $ | 6 | | | $ | 4 | | | $ | 1 | | | $ | 3 | | | $ | 1 | | | Interest cost on projected benefit obligation | 58 | | | 14 | | | 19 | | | 9 | | | 10 | | | 3 | | | 4 | | | 2 | | | Expected return on plan assets | (140) | | | (38) | | | (46) | | | (22) | | | (24) | | | (6) | | | (9) | | | (6) | | | Amortization of actuarial loss | 24 | | | 5 | | | 6 | | | 3 | | | 3 | | | 2 | | | 3 | | | 2 | | | Amortization of prior service credit | (5) | | | (1) | | | — | | | — | | | — | | | — | | | — | | | (2) | | | Amortization of settlement charges | 14 | | | 3 | | | 5 | | | 4 | | | 1 | | | 2 | | | 1 | | | 2 | | | Net periodic pension costs | $ | (10) | | | $ | (5) | | | $ | (5) | | | $ | — | | | $ | (6) | | | $ | 2 | | | $ | 2 | | | $ | (1) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended September 30, 2021 | | | | | Duke | | | | Duke | | Duke | | Duke | | Duke | | | | | Duke | | Energy | | Progress | | Energy | | Energy | | Energy | | Energy | | | | (in millions) | Energy | | Carolinas | | Energy | | Progress | | Florida | | Ohio | | Indiana | | Piedmont | | Service cost | $ | 43 | | | $ | 14 | | | $ | 13 | | | $ | 7 | | | $ | 5 | | | $ | 2 | | | $ | 2 | | | $ | 1 | | | Interest cost on projected benefit obligation | 55 | | | 13 | | | 17 | | | 8 | | | 10 | | | 2 | | | 5 | | | 2 | | | Expected return on plan assets | (139) | | | (36) | | | (47) | | | (21) | | | (25) | | | (7) | | | (10) | | | (5) | | | Amortization of actuarial loss | 33 | | | 7 | | | 10 | | | 5 | | | 5 | | | 2 | | | 3 | | | 2 | | | Amortization of prior service credit | (7) | | | (2) | | | (1) | | | — | | | (1) | | | — | | | — | | | (1) | | | Amortization of settlement charges | 2 | | | 1 | | | 1 | | | — | | | — | | | — | | | — | | | 1 | | | Net periodic pension costs | $ | (13) | | | $ | (3) | | | $ | (7) | | | $ | (1) | | | $ | (6) | | | $ | (1) | | | $ | — | | | $ | — | | 88

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Traditional life and health, interest rate, low end

2.5

SEC-NUM

[Table of Contents](#ic55317410763413da1d4be4008f977bd_658)Globe Life Inc.Notes to Consolidated Financial Statements(Dollar amounts in thousands, except per share data)$328 million and $306 million at December 31, 2021 and 2020, respectively, and was included in "Other assets" on the [Consolidated Balance Sheets](#ic55317410763413da1d4be4008f977bd_16). As of December 31, 2021, Globe Life was obligated under future commitments of $177 million, which are recorded in "Other liabilities". For guaranteed investments acquired prior to January 1, 2015, the Company utilizes the effective-yield method of amortization, while the proportional method of amortization is utilized for all non-guaranteed and guaranteed investments acquired on or after January 1, 2015. All amortization expense is recorded in "Income tax benefit (expense)" on the [Consolidated Statements of Operations](#ic55317410763413da1d4be4008f977bd_745). Property and Equipment: Property and equipment, included in “Other assets,” is reported at cost less accumulated depreciation. Depreciation is recorded primarily on the straight line method over the estimated useful lives of these assets which range from three to ten years for equipment and fifteen to forty years for buildings and improvements. Ordinary maintenance and repairs are charged to income as incurred. Impairments, if any, are recorded when certain events and circumstances become evident that the fair value of the asset is less than its carrying amount. Original cost of property and equipment was $378 million at December 31, 2021 and $350 million at December 31, 2020. Accumulated depreciation was $173 million at the end of 2021 and $164 million at the end of 2020. Depreciation expense was $20 million in 2021, $17 million in 2020, and $16 million in 2019. Internally generated software costs are expensed as incurred in the preliminary project phase and post-implementation phase, and are capitalized during the application development stage. Additionally, implementation costs incurred in a hosting arrangement that is a service contract are capitalized. Future Policy Benefits: The liability for future policy benefits for annuity and universal life-type products is represented by policy account value. The liability for future policy benefits for all other life and health products, approximately 90% of total liabilities for future policy benefits, is determined on the net level premium method. This method provides for the present value of expected future benefit payments less the present value of expected future net premiums, based on estimated investment yields, mortality, morbidity, persistency, and other assumptions which were considered appropriate at the time the policies were issued. For limited-payment contracts, a deferred profit liability is also recorded which causes profits to emerge over the life of the contract in proportion to the amount of insurance in force. Assumptions used for traditional life and health insurance products are based primarily on Company experience. Assumptions for interest rates range from 2.5% to 7.0% for Globe Life's insurance companies with an overall weighted average assumed rate of 5.7%. Mortality tables used for individual life insurance include various industry tables and reflect modifications of a variety of generally accepted actuarial tables based on Company experience. Morbidity assumptions for individual health are based on Company experience and industry data. Withdrawal and termination assumptions are based on Globe Life's experience. Once established, assumptions for these products are generally not changed. An additional provision is made on most products to allow for possible adverse deviation from the assumptions. These estimates are reviewed annually and compared with actual experience. If it is determined that existing contract liabilities, together with the present value of future gross premiums, will not be sufficient to cover the present value of future benefits and to recover unamortized deferred acquisition costs, then a premium deficiency exists. Such a deficiency would be recognized immediately by a charge to earnings and either a reduction of unamortized deferred acquisition costs or an increase in the liability for future policy benefits. From that point forward, the liability for future policy benefits would be based on revised assumptions. Reinsurance: In the normal course of business, Globe Life insurance subsidiaries will enter into reinsurance agreements to limit their exposure to the risk of loss as well as enhance their capital position. To qualify for reinsurance accounting in accordance with applicable guidance, the assuming company (reinsurer) must have the “reasonable possibility” that it may realize a “significant loss.” In instances where the ceding company does not transfer significant insurance risk to the reinsurer, deposit accounting is utilized. Deposits received are reported in Other Assets on the [Consolidated Balance Sheets](#ic55317410763413da1d4be4008f977bd_16) rather than income in the [Consolidated Statements of Operations](#ic55317410763413da1d4be4008f977bd_745). As amounts are paid or received in accordance with the agreements, the deposit balance will be adjusted. Any risk charges payable related to reinsurance agreements where deposit accounting is applicable are recorded as an Other Liability. Unearned and Advanced Premium: Premium collected from both life and health policies that have not been earned and recognized in accordance with applicable GAAP. Refer to Recognition of Premium Revenue below.69 GL 2021 FORM 10-K

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Debt Instrument, Redemption Price, Percentage

100

SEC-NUM

[Table of Contents](#i7f92822ddf844c24912627bf68509b56_7) Note 3—Fair Value MeasurementAssets and Liabilities Measured at Fair Value on a Recurring BasisThe table below presents information regarding the Company’s financial assets and financial liabilities that are measured at fair value on a recurring basis and indicate the level within the hierarchy reflecting the valuation techniques utilized to determine such fair value. | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | Level 2 | | | 2022 | | 2021 | | | | | | | Investment in government and agency securities(1) | $ | 529 | | | $ | 393 | | | | | | | | | | | | | | | | | | Forward foreign-exchange contracts, in asset position(2) | 34 | | | 17 | | | Forward foreign-exchange contracts, in (liability) position(2) | (2) | | | (2) | | | Total | $ | 561 | | | $ | 408 | | \_\_\_\_\_\_\_\_\_\_\_\_(1)At August 29, 2021, $12 cash and cash equivalents and $381 short-term investments are included in the consolidated balance sheets.(2)The asset and the liability values are included in other current assets and other current liabilities, respectively, in the consolidated balance sheets. At August 28, 2022, and August 29, 2021, the Company did not hold any Level 1 or 3 financial assets or liabilities that were measured at fair value on a recurring basis. There were no transfers between levels during 2022 or 2021.Assets and Liabilities Measured at Fair Value on a Nonrecurring BasisAssets and liabilities recognized and disclosed at fair value on a nonrecurring basis include items such as financial assets measured at amortized cost and long-lived nonfinancial assets. These assets are measured at fair value if determined to be impaired. There were no fair value adjustments to nonfinancial assets during 2022 and in 2021 they were immaterial.Note 4—DebtShort-Term BorrowingsThe Company maintains various short-term bank credit facilities, with a borrowing capacity of $1,257 and $1,050, in 2022 and 2021, respectively. Borrowings on these short-term facilities were immaterial during 2022 and 2021. Short-term borrowings outstanding were $88 and $41 at the end of 2022 and 2021.Long-Term DebtThe Company's long-term debt consists primarily of Senior Notes, described below. On December 1, 2021, the Company repaid, prior to maturity, the 2.300% Senior Notes at a redemption price plus accrued interest as specified in the Notes' agreement.The Company at its option may redeem the Senior Notes at any time, in whole or in part, at a redemption price plus accrued interest. The redemption price is equal to the greater of 100% of the principal amount or the sum of the present value of the remaining scheduled payments of principal and interest to maturity. Additionally, upon certain events, the holder has the right to require the Company to purchase this security at a price of 101% of the principal amount plus accrued and unpaid interest to the date of the event. Interest on all outstanding long-term debt is payable semi-annually. The estimated fair value of Senior Notes is valued using Level 2 inputs. Other long-term debt consists of Guaranteed Senior Notes issued by the Company's Japanese subsidiary, valued using Level 3 inputs.51

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Customer deposit liabilities acquired

197

SEC-NUM

New Accounting Pronouncements Recently issued ASUs effective after March 31, 2022 are not expected to have a material effect on DXC's consolidated financial statements. Note 2 - Acquisitions Fiscal 2021 Acquisitions AXA Bank Germany Acquisition On January 1, 2021, DXC completed its acquisition of AXA Bank Germany ("AXA Bank"), a German retail bank, from AXA Group for the total consideration of $101 million. In connection with its acquisition of AXA Bank, DXC received cash of $294 million which includes customer deposit liabilities totaling $197 million. DXC recorded goodwill associated with the acquisition of AXA Bank totaling $2 million. The AXA bank has been consolidated within FDB and will be part of the FDB sale previously disclosed. Fiscal 2020 Acquisitions Luxoft Acquisition On June 14, 2019, DXC completed the acquisition of Luxoft, a digital service provider whose offerings encompass strategic consulting, custom software development services, and digital solution engineering for total consideration of $2.0 billion. The acquisition combined Luxoft’s digital engineering capabilities with DXC’s expertise in IT modernization and integration. The purchase agreement was entered into by DXC and Luxoft on January 6, 2019 and the transaction was closed on June 14, 2019. The transaction between DXC and Luxoft is an acquisition, with DXC as the acquirer and Luxoft as the acquiree, based on the fact that DXC acquired 100% of the equity interests and voting rights in Luxoft, and that DXC is the entity that transferred the cash consideration. The Company's allocation of the purchase price to the assets acquired and liabilities assumed as of the Luxoft acquisition date is as follows: | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | (in millions) | | Fair Value | | Cash and cash equivalents | | $ | 113 | | | Accounts receivable | | 233 | | | Other current assets | | 15 | | | Total current assets | | 361 | | | Property and equipment | | 31 | | | Intangible assets | | 577 | | | Other assets | | 99 | | | Total assets acquired | | 1,068 | | | Accounts payable, accrued payroll, accrued expenses, and other current liabilities | | (121) | | | Deferred revenue | | (8) | | | Long-term deferred tax liabilities and income tax payable | | (106) | | | Other liabilities | | (72) | | | Total liabilities assumed | | (307) | | | Net identifiable assets acquired | | 761 | | | | | | | Goodwill | | 1,262 | | | Total consideration transferred | | $ | 2,023 | | 79

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Brazilian internal revenue authority, matter 2

50

SEC-NUM

COLGATE-PALMOLIVE COMPANY Notes to Condensed Consolidated Financial Statements (continued) (Dollars in Millions Except Share and Per Share Amounts)(Unaudited) subsidiary jointly and severally liable for any tax due from the Seller’s Brazilian subsidiary. The case has been pending since 2002, and the Lower Federal Court has not issued a decision. Although there can be no assurances, management believes, based on the opinion of its Brazilian legal counsel, that the Company should ultimately prevail in this action. The Company is challenging this action vigorously. In December 2005, the Brazilian internal revenue authority issued to the Company’s Brazilian subsidiary a tax assessment with interest, penalties and any court-mandated fees of approximately $50, at the current exchange rate, based on a claim that certain purchases of U.S. Treasury bills by the subsidiary and their subsequent disposition during the period 2000 to 2001 were subject to a tax on foreign exchange transactions. The Company had been disputing the assessment within the internal revenue authority’s administrative appeals process. However, in November 2015, the Superior Chamber of Administrative Tax Appeals denied the Company’s final administrative appeal, and the Company has filed a lawsuit in the Brazilian federal court. In the event the Company is unsuccessful in this lawsuit, further appeals are available within the Brazilian federal courts. Although there can be no assurances, management believes, based on the opinion of its Brazilian legal counsel, that the tax assessment is without merit and that the Company should ultimately prevail. The Company is challenging this assessment vigorously. Competition Matter Certain of the Company’s subsidiaries were historically subject to actions and, in some cases, fines, by governmental authorities in a number of countries related to alleged competition law violations. Substantially all of these matters also involved other consumer goods companies and/or retail customers. The Company’s policy is to comply with antitrust and competition laws and, if a violation of any such laws is found, to take appropriate remedial action and to cooperate fully with any related governmental inquiry. The status as of September 30, 2022 of such competition law matters pending against the Company during the nine months ended September 30, 2022 is set forth below. ▪In July 2014, the Greek competition law authority issued a statement of objections alleging a restriction of parallel imports into Greece. The Company responded to this statement of objections. In July 2017, the Company received the decision from the Greek competition law authority in which the Company was fined $11. The Company appealed the decision to the Greek courts. In April 2019, the Greek courts affirmed the judgment against the Company’s Greek subsidiary, but reduced the fine to $10.5 and dismissed the case against Colgate-Palmolive Company. The Company’s Greek subsidiary and the Greek competition authority have appealed the decision to the Greek Supreme Court. Talcum Powder Matters The Company has been named as a defendant in civil actions alleging that certain talcum powder products that were sold prior to 1996 were contaminated with asbestos and/or caused mesothelioma and other cancers. Many of these actions involve a number of co-defendants from a variety of different industries, including suppliers of asbestos and manufacturers of products that, unlike the Company’s products, were designed to contain asbestos. As of September 30, 2022, there were 224 individual cases pending against the Company in state and federal courts throughout the United States, as compared to 203 cases as of June 30, 2022 and 171 cases as of December 31, 2021. During the three months ended September 30, 2022, 33 new cases were filed and 12 cases were resolved by voluntary dismissal or settlement. During the nine months ended September 30, 2022, 72 cases were filed and 19 cases were resolved by voluntary dismissal or settlement. The values of the settlements in the quarter and year-to-date period presented were not material, either individually or in the aggregate, to the Company’s results of operations in either such period. A significant portion of the Company’s costs incurred in defending and resolving these claims has been, and the Company believes that a portion of such costs will continue to be, covered by insurance policies issued by several primary, excess and umbrella insurance carriers, subject to deductibles, exclusions, retentions, policy limits and insurance carrier insolvencies. While the Company and its legal counsel believe that these cases are without merit and intend to challenge them vigorously, there can be no assurances regarding the ultimate resolution of these matters. 17

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Cost, 5 years to 10 years

71

SEC-NUM

[Table of Co](#i2c056a9f8317485ea6601862f5b0559f_7)[ntents](#i2c056a9f8317485ea6601862f5b0559f_7)The following table presents the cost and fair value of investments in debt and equity securities in Ameren’s and Ameren Missouri’s nuclear decommissioning trust fund at December 31, 2021 and December 31, 2020: | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | Security Type | Cost | | Gross Unrealized Gain | | Gross Unrealized Loss | | Fair Value | | 2021 | | | | | | | | | Debt securities | $ | 320 | | | $ | 10 | | | $ | 2 | | | $ | 328 | | | Equity securities | 188 | | | 640 | | | 4 | | | 824 | | | Cash and cash equivalents | 4 | | | — | | | — | | | 4 | | | Other(a) | 3 | | | — | | | — | | | 3 | | | Total | $ | 515 | | | $ | 650 | | | $ | 6 | | | $ | 1,159 | | | 2020 | | | | | | | | | Debt securities | $ | 272 | | | $ | 25 | | | $ | — | | | $ | 297 | | | Equity securities | 198 | | | 491 | | | 9 | | | 680 | | | Cash and cash equivalents | 4 | | | — | | | — | | | 4 | | | Other(a) | 1 | | | — | | | — | | | 1 | | | Total | $ | 475 | | | $ | 516 | | | $ | 9 | | | $ | 982 | | (a)Represents net receivables and payables relating to pending securities sales, interest, and securities purchases.The following table presents the costs and fair values of investments in debt securities in Ameren’s and Ameren Missouri’s nuclear decommissioning trust fund according to their contractual maturities at December 31, 2021: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | Cost | | Fair Value | | Less than 5 years | $ | 155 | | | $ | 156 | | | 5 years to 10 years | 71 | | | 72 | | | Due after 10 years | 94 | | | 100 | | | Total | $ | 320 | | | $ | 328 | | InsuranceThe following table presents insurance coverage at Ameren Missouri’s Callaway Energy Center at January 1, 2022: | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | Type and Source of Coverage | Most RecentRenewal Date | Maximum Coverages | | Maximum Assessmentsfor Single Incidents | | | Public liability and nuclear worker liability: | | | | | | | American Nuclear Insurers | January 1, 2022 | $ | 450 | | | $ | — | | | | Pool participation | (a) | 13,073 | | (a) | 138 | | (b) | | | | $ | 13,523 | | (c) | $ | 138 | | | | Property damage: | | | | | | | NEIL and EMANI | April 1, 2021 | $ | 3,200 | | (d) | $ | 25 | | (e) | | Accidental outage: | | | | | | | NEIL | April 1, 2021 | $ | 490 | | (f) | $ | 7 | | (e) | (a)Provided through mandatory participation in an industrywide retrospective premium assessment program. The maximum coverage available is dependent on the number of United States commercial reactors participating in the program.(b)Retrospective premium under the Price-Anderson Act. This is subject to retrospective assessment with respect to a covered loss in excess of $450 million in the event of an incident at any licensed United States commercial reactor, payable at $21 million per year.(c)Limit of liability for each incident under the Price-Anderson liability provisions of the Atomic Energy Act of 1954, as amended. This limit is subject to change to account for the effects of inflation and changes in the number of licensed power reactors.(d)NEIL provides $2.7 billion in property damage, stabilization, decontamination, and premature decommissioning insurance for radiation events and $2.3 billion in property damage insurance for nonradiation events. EMANI provides $490 million in property damage insurance for both radiation and nonradiation events.(e)All NEIL-insured plants could be subject to assessments should losses exceed the accumulated funds from NEIL.(f)Accidental outage insurance provides for lost sales in the event of a prolonged accidental outage. Weekly indemnity up to $4.5 million for 52 weeks, which commences after the first 12 weeks of an outage, plus up to $3.6 million per week for a minimum of 71 weeks thereafter for a total not exceeding the policy limit of $490 million. Nonradiation events are limited to $328 million.The Price-Anderson Act is a federal law that limits the liability for claims from an incident involving any licensed United States commercial nuclear energy center. The limit is based on the number of licensed reactors. The limit of liability and the maximum potential annual payments are adjusted at least every five years for inflation to reflect changes in the Consumer Price Index. The most recent five-year inflationary adjustment became effective in November 2018. Owners of a nuclear reactor cover this exposure through a combination of private insurance and mandatory participation in a financial protection pool, as established by the Price-Anderson Act.133

string

Total debt, par value

2,045,645

SEC-NUM

[Table of Contents](#ic55317410763413da1d4be4008f977bd_658)Globe Life Inc.Notes to Consolidated Financial Statements(Dollar amounts in thousands, except per share data)Note 11—Debt The following table presents information about the terms and outstanding balances of Globe Life's debt. Selected Information about Debt Issues | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | As of December 31, | | | | | | | | | 2021 | | 2020 | | Instrument | Issue Date | | Maturity Date | | Coupon Rate | | ParValue | | Unamortized Discount & Issuance Costs | | BookValue | | FairValue | | BookValue | | Senior notes | 5/27/1993 | | 5/15/2023 | | 7.875% | | $ | 165,612 | | | $ | (396) | | | $ | 165,216 | | | $ | 180,444 | | | $ | 164,954 | | | Senior notes(1) | 9/24/2012 | | 9/15/2022 | | 3.800% | | 150,000 | | | (248) | | | 149,752 | | | 153,284 | | | 149,414 | | | Senior notes | 9/27/2018 | | 9/15/2028 | | 4.550% | | 550,000 | | | (5,051) | | | 544,949 | | | 625,801 | | | 544,328 | | | Senior notes | 8/21/2020 | | 8/15/2030 | | 2.150% | | 400,000 | | | (4,222) | | | 395,778 | | | 395,208 | | | 395,157 | | | Junior subordinated debentures(2) | — | | — | | — | | — | | | — | | | — | | | — | | | 290,652 | | | Junior subordinated debentures | 11/17/2017 | | 11/17/2057 | | 5.275% | | 125,000 | | | (1,604) | | | 123,396 | | | 128,856 | | | 123,381 | | | Junior subordinated debentures | 6/14/2021 | | 6/15/2061 | | 4.250% | | 325,000 | | | (7,845) | | | 317,155 | | | 336,700 | | | — | | | | | | | | | | 1,715,612 | | | (19,366) | | | 1,696,246 | | | 1,820,293 | | | 1,667,886 | | | Less current maturity of long-term debt(1) | | 150,000 | | | (248) | | | 149,752 | | | 153,284 | | | — | | | Total long-term debt | | 1,565,612 | | | (19,118) | | | 1,546,494 | | | 1,667,009 | | | 1,667,886 | | | | | | | | | | | | | | | | | | | | Current maturity of long-term debt(1) | | 150,000 | | | (248) | | | 149,752 | | | 153,284 | | | — | | | Commercial paper | | 330,033 | | | (141) | | | 329,892 | | | 329,892 | | | 254,918 | | | Total short-term debt | | 480,033 | | | (389) | | | 479,644 | | | 483,176 | | | 254,918 | | | | | | | | | | | | | | | | | | | | Total debt | | $ | 2,045,645 | | | $ | (19,507) | | | $ | 2,026,138 | | | $ | 2,150,185 | | | $ | 1,922,804 | | (1)An additional $150 million par value and book value is held by insurance subsidiaries that eliminates in consolidation. (2)The $300 million of 6.125% Junior subordinated debentures were redeemed on July 15, 2021. The commercial paper has the highest priority of all the debt, followed by senior notes then junior subordinated debentures. The senior notes due 2023 are noncallable, the remaining senior notes are callable under a make-whole provision, and the junior subordinated debentures are subject to an optional redemption five years from issuance. Interest on the 4.25% junior subordinated debentures is payable quarterly while all other long-term debt is payable semi-annually. Contractual Debt Obligations: The following table presents expected scheduled principal payments under our contractual debt obligations: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Year Ended December 31, | | | 2022 | | 2023 | | 2024 | | 2025 | | 2026 | | Thereafter | | Debt obligations | $ | 480,033 | | | $ | 165,612 | | | $ | — | | | $ | — | | | $ | — | | | $ | 1,400,000 | | Credit Facility: On September 30, 2021, Globe Life amended the credit agreement dated August 24, 2020, which provides for a $750 million revolving credit facility that may be increased to $1 billion. The amended credit facility matures September 30, 2026, and may be extended up to two one-year periods upon the Company's request. Pursuant to this agreement, the participating lenders have agreed to make revolving loans to Globe Life and to issue secured or unsecured letters of credit. The Company has not drawn on any of the credit to date.104 GL 2021 FORM 10-K

string

Net income from operations

321

SEC-NUM

EXTRA SPACE STORAGE INC.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)Amounts in thousands, except store and share data, unless otherwise statedOther Investments On June 1, 2022 the Company completed the acquisition of Bargold Storage Systems, LLC ("Bargold") for a purchase price of approximately $179.3 million. Bargold leases space in apartment buildings, primarily in New York City and its boroughs, builds out the space as storage units, and subleases the units to tenants. As of June 1, 2022, Bargold had approximately 17,000 storage units with an approximate occupancy of 97%. This acquisition is considered a business combination ASU 2017-01, "Business Combinations (Topic 805): Clarifying the Definition of a Business." The following table summarizes the total consideration transferred to acquire Bargold: | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Total cash paid by the company | $ | 157,302 | | | Fair value of Series D Units issued | 16,000 | | | Fair value of OP Units issued | 6,000 | | | Total consideration transferred | $ | 179,302 | | As part of this acquisition, we recorded an expense of $1,465 related to transaction costs. The following table summarizes the preliminary estimated fair values of the assets acquired and liabilities assumed at the acquisition date. | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | Cash and cash equivalents | $ | 175 | | | Fixed assets | 6,411 | | | Developed technology | 500 | | | Trademarks | 500 | | | Customer relationships | 1,870 | | | Other assets | 125 | | | Accounts payables and accrued liabilities assumed | (1,090) | | | Nets asset acquired | 8,491 | | | Goodwill | 170,811 | | | Total assets acquired | $ | 179,302 | | The following table summarizes the revenues and earnings related to Bargold since the acquisition date of June 1, 2022, which are included in the Company's consolidated statement of operations for the six months ended June 30, 2022: | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | Total revenues | $ | 1,309 | | | Net income from operations | $ | 321 | | Pro Forma Information As noted above, during the six months ended June 30, 2022, the Company acquired Bargold. The following pro forma financial information is based on the combined historical financial statements of the Company and Bargold, however, only includes revenue and presents the Company's results as if the acquisition had occurred on January 1, 2021. Net income was excluded as it was impracticable to report expenses due to the lack of historical accrual basis accounting. | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | For the Six Months Ended June 30, 2022 | | For the Year Ended December 31, 2021 | | | Pro Forma | | Pro Forma | | Total revenues | $ | 925,196 | | | $ | 1,592,021 | | 19

string

Accelerated depreciation

1

SEC-NUM

D. Restructuring and Other Charges | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | First quarter ended | | | | | March 31, | | | | | 2022 | | 2021 | | | | | | | | | | | | | | | (Reversals of) adjustments to previously recorded layoff reserves | $ | (1) | | | $ | 1 | | | | | | | Pension and Other post-retirement benefits - net settlements ([E](#ib58fce0f7c97431fb8cb1c861d028b02_58)) | 1 | | | 3 | | | | | | | | | | | | | | | | Net loss related to divestitures of assets and businesses ([P](#ib58fce0f7c97431fb8cb1c861d028b02_91)) | — | | | 4 | | | | | | | Other | 2 | | | 1 | | | | | | | Restructuring and other charges | $ | 2 | | | $ | 9 | | | | | | In the first quarter of 2022, the Company recorded Restructuring and other charges of $2, which were primarily due to exit related costs of $2 and charges for a U.S. pension plan settlement of $1, partially offset by a reversal of $1 for a layoff reserve related to a prior period.In the first quarter of 2021, the Company recorded Restructuring and other charges of $9, which included a $4 charge for impairment of assets associated with an agreement to sell a small manufacturing business in France, a $3 charge for U.S. pension plans' settlement accounting, a $1 adjustment related to a number of prior period program reserves and a $1 charge for exit costs including accelerated depreciation. | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | Layoff costs | | Other exit costs | | Total | | Reserve balances at December 31, 2021 | $ | 17 | | | $ | 2 | | | $ | 19 | | | Cash payments | (2) | | | (2) | | | (4) | | | Restructuring charges | — | | | 2 | | | 2 | | | Other(1) | (1) | | | — | | | (1) | | | Reserve balances at March 31, 2022 | $ | 14 | | | $ | 2 | | | $ | 16 | | (1)In the first quarter of 2022, Other for layoff costs included a $1 charge for a pension plan settlement.The majority of the layoff cost and other exit cost reserves is expected to be paid in cash during 2022, with small amounts to be paid through 2024.E. Pension and Other Postretirement BenefitsThe components of net periodic cost (benefit) were as follows: | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | First quarter ended | | | | | | March 31, | | | | | | 2022 | | 2021 | | | | | | | Pension benefits | | | | | | | | | | Service cost | $ | 1 | | | $ | 1 | | | | | | | | Interest cost | 12 | | | 12 | | | | | | | | Expected return on plan assets | (20) | | | (23) | | | | | | | | Recognized net actuarial loss | 13 | | | 14 | | | | | | | | | | | | | | | | | | Settlements | 1 | | | 3 | | | | | | | | | | | | | | | | | | | | | | | | | | | | Net periodic cost(1) | $ | 7 | | | $ | 7 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Other postretirement benefits | | | | | | | | | | Service cost | $ | — | | | $ | — | | | | | | | | Interest cost | 1 | | | 1 | | | | | | | | Recognized net actuarial loss | — | | | — | | | | | | | | Amortization of prior service benefit | (2) | | (1) | | | | | | | | | | | | | | | | | | | | | | | | | | | Net periodic benefit(1) | $ | (1) | | | $ | — | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (1)Service cost was included within Cost of goods sold, Selling, general administrative, and other expenses, and Research and 11

string

Foreign exchange option contracts, maximum maturities

24

SEC-NUM

| | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | [Table of Contents](#if498f6f02e5a474790944835d386b56b_7) | Alphabet Inc. | Non-marketable equity securitiesThe following is a summary of unrealized gains and losses recorded in other income (expense), net, which are included as adjustments to the carrying value of non-marketable equity securities held as of the end of the period (in millions): | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | Three Months Ended | | | | | March 31, | | | | | | | 2021 | | 2022 | | Unrealized gains on non-marketable equity securities | | | | | $ | 4,678 | | | $ | 838 | | | Unrealized losses on non-marketable equity securities (including impairment) | | | | | (2) | | | (378) | | | Total unrealized gain (loss) recognized on non-marketable equity securities | | | | | $ | 4,676 | | | $ | 460 | | During the three months ended March 31, 2022, included in the $28.7 billion of non-marketable equity securities held as of the end of the period, $3.1 billion were measured at fair value resulting in a net unrealized gain of $0.5 billion.Equity securities accounted for under the Equity MethodAs of December 31, 2021 and March 31, 2022, equity securities accounted for under the equity method had a carrying value of approximately $1.5 billion and $1.4 billion, respectively. Our share of gains and losses, including impairments, are included as a component of other income (expense), net, in the Consolidated Statements of Income. See Note 6 for further details on other income (expense), net.Derivative Financial InstrumentsWe enter into derivative instruments to manage risks relating to our ongoing business operations. The primary risk managed with derivative instruments is foreign exchange risk. We use foreign currency contracts to reduce the risk that our cash flows, earnings, and investment in foreign subsidiaries will be adversely affected by foreign currency exchange rate fluctuations. We also enter into derivative instruments to partially offset our exposure to other risks and enhance investment returns.We recognize derivative instruments as either assets or liabilities in the Consolidated Balance Sheets at fair value and classify the derivatives primarily within Level 2 in the fair value hierarchy. We present our collar contracts (an option strategy comprised of a combination of purchased and written options) at net fair values where both the purchased and written options are with the same counterparty. For other derivative contracts, we present at gross fair values. We primarily record changes in the fair value in the Consolidated Statements of Income as either other income (expense), net, or revenues, or in the Consolidated Balance Sheets in AOCI, as discussed below.We enter into master netting arrangements, which reduce credit risk by permitting net settlement of transactions with the same counterparty. Further, we enter into collateral security arrangements that provide for collateral to be received or pledged when the net fair value of certain financial instruments fluctuates from contractually established thresholds. Cash collateral received related to derivative instruments under our collateral security arrangements are included in other current assets with a corresponding liability. Cash and non-cash collateral pledged related to derivative instruments under our collateral security arrangements are included in other current assets.Cash Flow HedgesWe designate foreign currency forward and option contracts (including collars) as cash flow hedges to hedge certain forecasted revenue transactions denominated in currencies other than the U.S. dollar. These contracts have maturities of 24 months or less.Cash flow hedge amounts included in the assessment of hedge effectiveness are deferred in AOCI and subsequently reclassified to revenue when the hedged item is recognized in earnings. We exclude the change in forward points and time value from our assessment of hedge effectiveness. The initial value of the excluded component is amortized on a straight-line basis over the life of the hedging instrument and recognized in revenues. The difference between fair value changes of the excluded component and the amount amortized to revenues is recorded in AOCI. If the hedged transactions become probable of not occurring, the corresponding amounts in AOCI are reclassified to other income (expense), net in the period of de-designation.As of March 31, 2022, the net accumulated gain on our foreign currency cash flow hedges before tax effect was $356 million, which is expected to be reclassified from AOCI into earnings within the next 12 months.15

string

Dividend payable (in dollars per share)

0.65

SEC-NUM

[Table of Contents](#i1852a2ea91e948d98ea7c44fc3e188ea_7)10. Capital StockDividendsCommon StockIn February 2022, the Company’s Board of Directors approved an increase in the quarterly base dividend on the Company’s common stock from $0.125 to $0.15 per share. The following table summarizes the dividends the Company has paid on its common stock during the six months ended June 30, 2022 and 2021: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Rate per share | | | | | | Fixed | | Variable | | Total | | Total Dividends Paid (In millions) | | 2022: | | | | | | | | | | First quarter | | $ | 0.15 | | | $ | 0.41 | | | $ | 0.56 | | | $ | 455 | | | Second quarter | | 0.15 | | 0.45 | | 0.60 | | 484 | | | | | | | | | | | | | | | | | | | | | | | Total year-to-date | | $ | 0.30 | | | $ | 0.86 | | | $ | 1.16 | | | $ | 939 | | | 2021: | | | | | | | | | | First quarter | | $ | 0.10 | | | $ | — | | | $ | 0.10 | | | $ | 40 | | | Second quarter | | 0.11 | | — | | | 0.11 | | 44 | | | | | | | | | | | | | | | | | | | | | | | Total year-to-date | | $ | 0.21 | | | $ | — | | | $ | 0.21 | | | $ | 84 | | Subsequent Event. In August 2022, the Company’s Board of Directors approved the quarterly base dividend of $0.15 per share and a variable dividend of $0.50 per share, resulting in a base-plus-variable dividend of $0.65 per share on the Company’s common stock. Treasury StockIn February 2022, the Company’s Board of Directors terminated the previously authorized share repurchase program and authorized a new share repurchase program. This new share repurchase program authorizes the Company to purchase up to $1.25 billion of the Company’s common stock in the open market or in negotiated transactions. During the six months ended June 30, 2022, the Company repurchased 20 million shares for $513 million under the new share repurchase program, including repurchases of $27 million that were purchased prior to June 30, 2022 and settled in July 2022. As of June 30, 2022, 99 million shares were held as treasury stock, with $737 million remaining under the Company’s current share repurchase program.Cimarex Redeemable Preferred StockIn May 2022, the holders of 21,900 shares of Cimarex redeemable preferred stock elected to convert their Cimarex redeemable preferred stock into Coterra common stock and cash. As a result of the conversion, the holders received 809,846 shares of Coterra common stock and $10 million in cash according to the terms of the Certificate of Designations for the Cimarex redeemable preferred stock. The book value of the converted shares was $39 million, and upon conversion the excess of carrying value over cash paid was credited to additional paid-in capital. There was no gain or loss recognized on the transaction because it was completed in accordance with the original terms of the Certificate of Designations for the Cimarex redeemable preferred stock. At June 30, 2022, there were 6,125 shares of Cimarex redeemable preferred stock outstanding with a carrying value of $11 million. 11. Stock-Based CompensationGeneralThe Company grants certain stock-based compensation awards, including restricted stock awards, restricted stock units, performance share awards and stock options. Stock-based compensation expense associated with these awards was $21 million and $4 million in the second quarter of 2022 and 2021, respectively, and $44 million and $16 million for the six months ended 16

string

Redemption of Equity Instruments

47.4

SEC-NUM

[Table of Contents](#i3d0ebbc4e2a2420f98ed7e6fe698936a_7)HASBRO, INC. AND SUBSIDIARIESConsolidated Statements of Cash FlowsFiscal Years Ended in December(Millions of Dollars) | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | 2021 | | 2020 | | 2019 | | Cash flows from operating activities | | | | | | | Net earnings | $ | 435.3 | | | 225.4 | | | 520.5 | | | Adjustments to reconcile net earnings to net cash provided by operating activities: | | | | | | | Depreciation of property, plant and equipment | 163.3 | | | 120.2 | | | 133.5 | | | Loss on disposal of business | 108.8 | | | — | | | — | | | Impairment of intangibles and production assets | — | | | 71.5 | | | — | | | Loss on Discovery investment | 74.1 | | | — | | | — | | | Fair value adjustment on Discovery Option | (20.1) | | | (1.5) | | | (1.2) | | | Non-cash pension settlement | — | | | — | | | 111.0 | | | Amortization of intangible assets | 116.8 | | | 144.7 | | | 47.3 | | | Program cost amortization | 628.6 | | | 387.1 | | | 85.6 | | | Deferred income taxes | 36.0 | | | 30.3 | | | (15.0) | | | Stock-based compensation | 97.8 | | | 49.7 | | | 28.0 | | | Other non-cash items | (1.5) | | | 9.0 | | | (53.0) | | | Changes in operating assets and liabilities, net of acquired and disposed balances: | | | | | | | (Increase) decrease in accounts receivable | (159.5) | | | 210.8 | | | (211.5) | | | (Increase) decrease in inventories | (173.9) | | | 62.8 | | | (4.6) | | | (Increase) decrease in prepaid expenses and other current assets | (30.6) | | | (7.5) | | | 18.1 | | | Program spend, net | (697.3) | | | (438.9) | | | (33.9) | | | Increase in accounts payable and accrued liabilities | 313.2 | | | 49.3 | | | 62.3 | | | Change in net deemed repatriation tax | (18.4) | | | (18.4) | | | (14.6) | | | Other | (54.7) | | | 81.8 | | | (19.4) | | | Net cash provided by operating activities | 817.9 | | | 976.3 | | | 653.1 | | | Cash flows from investing activities | | | | | | | Additions to property, plant and equipment | (132.7) | | | (125.8) | | | (133.6) | | | Investments and acquisitions, net of cash acquired | — | | | (4,412.9) | | | (8.8) | | | Proceeds from sale of business, net of cash | 378.5 | | | — | | | — | | | Net gains on derivative contracts | — | | | — | | | 80.0 | | | Other | (3.8) | | | 38.5 | | | 1.5 | | | Net cash provided (utilized) by investing activities | 242.0 | | | (4,500.2) | | | (60.9) | | | Cash flows from financing activities | | | | | | | Net proceeds from borrowings | 144.0 | | | 1,112.6 | | | 2,355.0 | | | Repayments of borrowings | (1,220.1) | | | (275.5) | | | — | | | Net repayments of other short-term borrowings | (5.6) | | | (8.6) | | | (8.8) | | | Purchases of common stock | — | | | — | | | (61.4) | | | Stock-based compensation transactions | 30.6 | | | 16.6 | | | 31.8 | | | Dividends paid | (374.5) | | | (372.7) | | | (336.6) | | | Payments related to tax withholding for share-based compensation | (13.7) | | | (6.0) | | | (13.1) | | | Redemption of equity instruments | — | | | (47.4) | | | — | | | Deferred acquisition payments | — | | | — | | | (100.0) | | | Proceeds from issuance of common stock | — | | | — | | | 975.2 | | | Debt extinguishment costs | (9.1) | | | — | | | — | | | Debt acquisition costs | — | | | — | | | (26.7) | | | Other | (11.4) | | | (13.1) | | | (4.8) | | | Net cash (utilized) provided by financing activities | (1,459.8) | | | 405.9 | | | 2,810.6 | | | Effect of exchange rate changes on cash | (30.6) | | | (12.7) | | | (4.8) | | | (Decrease) increase in cash, cash equivalents and restricted cash | (430.5) | | | (3,130.7) | | | 3,398.0 | | | Cash, cash equivalents and restricted cash at beginning of year | 1,449.7 | | | 4,580.4 | | | 1,182.4 | | | Cash, cash equivalents and restricted cash at end of year | $ | 1,019.2 | | | 1,449.7 | | | 4,580.4 | | | Supplemental information | | | | | | | Interest paid | $ | 171.9 | | | 182.9 | | | 82.2 | | | Income taxes paid | $ | 160.5 | | | 81.6 | | | 103.1 | | See accompanying notes to consolidated financial statements.76

string

Number of Scientists, Engineers, and Technicians

18,900

SEC-NUM

[Table of Contents](#i5ec3aabfaa534f9c8fa2d2a5b7677d19_7) APTIV PLCNOTES TO CONSOLIDATED FINANCIAL STATEMENTS1. GENERALGeneral and basis of presentation—“Aptiv,” the “Company,” “we,” “us” and “our” refer to Aptiv PLC (formerly known as Delphi Automotive PLC), a public limited company formed under the laws of Jersey on May 19, 2011, which completed an initial public offering on November 22, 2011, and its consolidated subsidiaries. On December 4, 2017, following the spin-off of Delphi Technologies, the Company changed its name to Aptiv PLC and its NYSE symbol to “APTV.”The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).Nature of operations—Aptiv is a leading global technology and mobility architecture company primarily serving the automotive sector. We deliver end-to-end mobility solutions enabling our customers' transition to more electrified, software-defined vehicles. We design and manufacture vehicle components and provide electrical, electronic and active safety technology solutions to the global automotive and commercial vehicle markets. Aptiv is one of the largest vehicle technology suppliers and our customers include the 25 largest automotive original equipment manufacturers (“OEMs”) in the world. Aptiv operates 127 major manufacturing facilities and 12 major technical centers utilizing a regional service model that enables the Company to efficiently and effectively serve its global customers from best cost countries. Aptiv has a presence in 46 countries and has approximately 18,900 scientists, engineers and technicians focused on developing market relevant product solutions for its customers. 2. SIGNIFICANT ACCOUNTING POLICIESConsolidation—The consolidated financial statements include the accounts of Aptiv and the subsidiaries in which Aptiv holds a controlling financial or management interest and variable interest entities of which Aptiv has determined that it is the primary beneficiary. Aptiv’s share of the earnings or losses of non-controlled affiliates, over which Aptiv exercises significant influence (generally a 20% to 50% ownership interest), is included in the consolidated operating results using the equity method of accounting. When Aptiv does not have the ability to exercise significant influence (generally when ownership interest is less than 20%), investments in non-consolidated affiliates without readily determinable fair value are measured at cost, less impairments, adjusted for observable price changes in orderly transactions for identical or similar investments of the same issuer, while investments in publicly traded equity securities are measured at fair value based on quoted prices for identical assets on active market exchanges as of each reporting date. The Company monitors its investments in affiliates for indicators of other-than-temporary declines in value on an ongoing basis. If the Company determines that such a decline has occurred, an impairment loss is recorded, which is measured as the difference between carrying value and estimated fair value. Estimated fair value is generally determined using an income approach based on discounted cash flows or negotiated transaction values.Intercompany transactions and balances between consolidated Aptiv businesses have been eliminated.During the years ended December 31, 2021, 2020 and 2019, Aptiv received dividends of $6 million, $9 million and $9 million, respectively, from its equity method investments. The dividends were recognized as a reduction to the investment and represented a return on investment included in cash flows from operating activities.Aptiv's equity investments without readily determinable fair value totaled $30 million and $113 million as of December 31, 2021 and 2020, respectively, and are classified within other long-term assets in the consolidated balance sheets. Aptiv's investments in publicly traded equity securities totaled $66 million as of December 31, 2021 and are classified within other long-term assets in the consolidated balance sheet. There were no publicly traded equity securities held as of December 31, 2020. Refer to Note 5. Investments in Affiliates for further information regarding Aptiv's equity investments.Use of estimates—Preparation of consolidated financial statements in conformity with U.S. GAAP requires the use of estimates and assumptions that affect amounts reported therein. Generally, matters subject to estimation and judgment include amounts related to accounts receivable realization, inventory obsolescence, asset impairments, useful lives of intangible and fixed assets, deferred tax asset valuation allowances, income taxes, pension benefit plan assumptions, accruals related to litigation, warranty costs, environmental remediation costs, contingent consideration arrangements, worker’s compensation accruals and healthcare accruals. Due to the inherent uncertainty involved in making estimates, including the duration and severity of the impacts of the COVID-19 pandemic and the ongoing global supply chain disruptions, actual results reported in future periods may be based upon amounts that differ from those estimates.Revenue recognition—Revenue is measured based on consideration specified in a contract with a customer. Customer contracts generally are represented by a combination of a current purchase order and a current production schedule issued by the customer. The Company recognizes revenue when it satisfies a performance obligation by transferring control over a product or service to a customer. From time to time, Aptiv enters into pricing agreements with its customers that provide for 70

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Preferred stock, shares authorized

10,000

SEC-NUM

[Table of Contents](#i2c45b01857824b67a12ec5acf3b2e95b_7)PART I. FINANCIAL INFORMATION Item 1.Financial StatementsF5, INC.CONSOLIDATED BALANCE SHEETS(unaudited, in thousands) | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | December 31,2021 | | September 30,2021 | | ASSETS | | | | | | Current assets | | | | | | Cash and cash equivalents | | $ | 512,406 | | | $ | 580,977 | | | Short-term investments | | 346,548 | | | 329,630 | | | Accounts receivable, net of allowances of $3,262 and $3,696 | | 419,282 | | | 340,536 | | | Inventories | | 20,795 | | | 22,055 | | | Other current assets | | 388,942 | | | 337,902 | | | Total current assets | | 1,687,973 | | | 1,611,100 | | | Property and equipment, net | | 185,355 | | | 191,164 | | | Operating lease right-of-use assets | | 237,341 | | | 244,934 | | | Long-term investments | | 76,991 | | | 132,778 | | | Deferred tax assets | | 148,333 | | | 128,193 | | | Goodwill | | 2,260,407 | | | 2,216,553 | | | Other assets, net | | 490,508 | | | 472,558 | | | Total assets | | $ | 5,086,908 | | | $ | 4,997,280 | | | LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | Current liabilities | | | | | | Accounts payable | | $ | 58,253 | | | $ | 62,096 | | | Accrued liabilities | | 314,845 | | | 341,487 | | | Deferred revenue | | 1,039,515 | | | 968,669 | | | Current portion of long-term debt | | 19,275 | | | 19,275 | | | Total current liabilities | | 1,431,888 | | | 1,391,527 | | | Deferred tax liabilities | | 2,723 | | | 2,414 | | | Deferred revenue, long-term | | 536,984 | | | 521,173 | | | Operating lease liabilities, long-term | | 287,596 | | | 296,945 | | | Long-term debt | | 344,954 | | | 349,772 | | | Other long-term liabilities | | 77,402 | | | 75,236 | | | Total long-term liabilities | | 1,249,659 | | | 1,245,540 | | | Commitments and contingencies (Note 9) | | | | | | Shareholders' equity | | | | | | Preferred stock, no par value; 10,000 shares authorized, no shares outstanding | | — | | | — | | | Common stock, no par value; 200,000 shares authorized, 60,711 and 60,652 shares issued and outstanding | | 145,189 | | | 192,458 | | | Accumulated other comprehensive loss | | (21,215) | | | (20,073) | | | Retained earnings | | 2,281,387 | | | 2,187,828 | | | Total shareholders' equity | | 2,405,361 | | | 2,360,213 | | | Total liabilities and shareholders' equity | | $ | 5,086,908 | | | $ | 4,997,280 | | The accompanying notes are an integral part of these consolidated financial statements. 4

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Balance at December 31, 2020

815

SEC-NUM

[Table](#i433d81903e814837b268e57261b357cb_7) [of Contents](#i433d81903e814837b268e57261b357cb_7)net notional value of $1.7 billion. As of December 31, 2021 and 2020, we had net forward assets of $3 million ($12 million gross forward asset) recorded in prepaid expenses and other current assets and $14 million ($23 million gross forward liability) recorded in accrued expenses and other current liabilities. We recorded $1 million, $74 million and $(8) million in net gains (losses) from foreign currency forward contracts in 2021, 2020 and 2019.The following table reconciles, in millions, the beginning and ending balances of Level 3 equity investment in GBT for which we have elected the fair value option. There was no internal movements to or from Level 3 from Level 1 or 2 for the year ended December 31, 2021. | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | Balance at December 31, 2020 | $ | — | | | Additions | 815 | | Balance at December 31, 2021 | $ | 815 | | In connection with our disposition of Egencia as discussed in NOTE 16 – Acquisitions and Divestiture, we received an indirect equity interest in GBT. The initial fair value estimate as of November 1 , 2021 was based on a blended analysis of the present value of future discounted cash flows and market value approach, Level 3 inputs. The unobservable inputs used in the discounted cash flows model included projected EBITDA margin growth rates of approximately 24%, a long term growth rate of 2.5%, and a weighted average cost of capital of 9%. Our significant estimates in the market approach model included identifying similar companies with comparable business factors that could be reasonably considered investment alternatives and assessing comparable valuation multiples while applying a control premium in estimating the fair value of the investment. The unobservable inputs to the market approach included a revenue multiple of 3.5x and a control premium of 20%. Significant increases or decreases in the inputs to the discounted cash flow or market value approach would result in a significant higher or lower fair value measurements. As of December 31, 2021, we concluded that there was no change in valuation.Assets Measured at Fair Value on a Non-recurring BasisOur non-financial assets, such as goodwill, intangible assets and property and equipment, as well as equity method investments, are adjusted to fair value when an impairment charge is recognized or the underlying investment is sold. Such fair value measurements are based predominately on Level 3 inputs. We measure our minority investments that do not have readily determinable fair values at cost less impairment, adjusted by observable price changes with changes recorded within other, net on our consolidated statements of operations.Goodwill. During 2021, we recognized a goodwill impairment charge of $14 million in our B2B segment resulting from valuing a component of our Egencia reporting unit that remained after the sale on November 1, 2021. During 2020, due to the severe and persistent negative effect COVID-19 had on global economies, the travel industry and our business, as well as the uncertainty and high variability in anticipated versus actual rates of recovery, in addition to our annual assessment on October 1, 2020, we deemed it necessary to perform various interim assessments of goodwill. As a result of assessments during 2020, we recognized goodwill impairment charges of $799 million, of which $559 million related to our Retail segment, primarily our Vrbo reporting unit, and $240 million related to our trivago segment. Our assessments compared the fair value of the reporting units to their carrying value. The fair value estimates for all reporting units, except trivago, were based on a blended analysis of the present value of future discounted cash flows and market value approach, Level 3 inputs. The significant estimates used in the discounted cash flows model included our weighted average cost of capital, projected cash flows and the long-term rate of growth. Our assumptions were based on the actual historical performance of the reporting unit and took into account operating result trends, the anticipated duration of COVID-19 impacts and rates of recovery, and implied risk premiums based on market prices of our equity and debt as of the assessment dates. Our significant estimates in the market approach model included identifying similar companies with comparable business factors such as size, growth, profitability, risk and return on investment and assessing comparable revenue and earnings multiples in estimating the fair value of the reporting unit. The fair value estimate for the trivago reporting unit was based on trivago’s stock price, a Level 1 input, adjusted for an estimated control premium. The excess of the reporting unit's carrying value over our estimate of the fair value was recorded as goodwill impairment charges during 2020. As of December 31, 2020, the applicable reporting units within our Retail segment had $2.3 billion goodwill remaining after the impairments incurred in 2020 and our trivago segment had $337 million goodwill remaining. Intangible and Long-term Assets. During 2021, we recognized long-term asset impairment charges of $6 million in our B2B segment resulting from the write-off of capitalized software of a component of our Egencia reporting unit that remained after the sale on November 1, 2021. During 2020, we recognized intangible asset impairment charges of $175 million within our Retail segment, of which $119 million related to indefinite-lived trade names that resulted from changes in estimated future revenues of the related brands as well as $35 million related to definite-lived intangible assets and $21 million related to other long-lived assets. F- 22

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Leverage ratio of total debt less available cash to EBITDA expressed in percentage

0.04

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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Amortization period for the loss on settlement of interest rate swap agreement

12

SEC-NUM

[Table of Contents](#ie3b4dd133255408488aec6011c49b801_10)APPLIED MATERIALS, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)Note 5 Derivative Instruments and Hedging ActivitiesDerivative Financial InstrumentsApplied conducts business in a number of foreign countries, with certain transactions denominated in local currencies, such as the Japanese yen, Israeli shekel, euro and Taiwanese dollar. Applied uses derivative financial instruments, such as forward exchange contracts and currency option contracts, to hedge certain forecasted foreign currency denominated transactions expected to occur typically within the next 24 months. The purpose of Applied’s foreign currency management is to mitigate the effect of exchange rate fluctuations on certain foreign currency denominated revenues, costs and eventual cash flows. The terms of currency instruments used for hedging purposes are generally consistent with the timing of the transactions being hedged.Applied does not use derivative financial instruments for trading or speculative purposes. Derivative instruments and hedging activities, including foreign currency exchange and interest rate contracts, are recognized on the balance sheet at fair value. Changes in the fair value of derivatives that do not qualify for hedge accounting treatment are recognized currently in earnings. All of Applied’s derivative financial instruments are recorded at their fair value in other current assets or in accounts payable and accrued expenses. Hedges related to anticipated transactions are designated and documented at the inception of the hedge as cash flow hedges and foreign exchange derivatives are typically entered into once per month. Cash flow hedges are evaluated for effectiveness quarterly. The effective portion of the gain or loss on these hedges is reported as a component of AOCI in stockholders’ equity and is reclassified into earnings when the hedged transaction affects earnings. The majority of the after-tax net income or loss related to foreign exchange derivative instruments included in AOCI at October 31, 2021 is expected to be reclassified into earnings within 12 months. Changes in fair value caused by changes in time value of option contracts designated as cash flow hedges are excluded from the assessment of effectiveness. The initial value of this excluded component is amortized on a straight-line basis over the life of the hedging instrument and recognized in the financial statement line item to which the hedge relates. If the transaction being hedged is probable not to occur, Applied promptly recognizes the gain or loss on the associated financial instrument in the consolidated condensed statement of operations. The amount recognized due to discontinuance of cash flow hedges that were probable of not occurring by the end of the originally specified time period was not significant for fiscal years 2021, 2020 or 2019.Foreign currency forward contracts are generally used to hedge certain foreign currency denominated assets or liabilities. Accordingly, changes in the fair value of these hedges are recorded in earnings to offset the changes in the fair value of the assets or liabilities being hedged.As of October 31, 2021 and October 25, 2020, the total outstanding notional amount of foreign exchange contracts was $2.1 billion and $1.6 billion, respectively. The fair values of foreign exchange derivative instruments at October 31, 2021 and October 25, 2020 were not material.Applied is also exposed to interest rate risk associated with its potential future borrowings. During fiscal 2020, Applied entered into a series of interest rate contracts to hedge against the variability of cash flows due to changes in the benchmark interest rate of fixed rate debt. These instruments were designated as cash flow hedges at inception and were settled in conjunction with the issuance of debt in May 2020.The gain (loss) on derivatives in cash flow hedging relationships recognized in AOCI for derivatives designated as hedging instruments for the indicated periods were as follows: | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | Derivatives in Cash Flow Hedging Relationships | | | 2021 | | 2020 | | 2019 | | | (In millions) | | Foreign exchange contracts | $ | 36 | | | $ | 3 | | | $ | (14) | | | Interest rate contracts | — | | | (151) | | | — | | | Total | $ | 36 | | | $ | (148) | | | $ | (14) | | 80

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Acquired lease costs

4.3

SEC-NUM

Table of ContentsConsolidated Statements of Cash Flows—Supplemental DisclosuresThe following tables provide supplemental disclosures related to the Consolidated Statements of Cash Flows: | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | Six Months Ended | | | | | June 30, | | | | | 2022 | | 2021 | | | | | (In thousands) | | SUPPLEMENTAL DISCLOSURES: | | | | | | | Total interest costs incurred | $ | 72,824 | | | $ | 76,284 | | | | | Interest capitalized | (9,177) | | | (13,022) | | | | | Interest expense | $ | 63,647 | | | $ | 63,262 | | | | | Cash paid for interest, net of amounts capitalized | $ | 61,973 | | | $ | 60,782 | | | | | Cash paid for income taxes | $ | 607 | | | $ | 320 | | | | | NON-CASH INVESTING AND FINANCING TRANSACTIONS: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | DownREIT operating partnership units redeemed for common shares | $ | 1,385 | | | $ | 5,121 | | | | | Shares issued under dividend reinvestment plan | $ | 866 | | | $ | 866 | | | | | 5.417% Series 1 Cumulative Convertible Preferred Shares redeemed for common shares | $ | 175 | | | $ | — | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | June 30, | | December 31, | | | | | 2022 | | 2021 | | | | | (In thousands) | | RECONCILIATION OF CASH, CASH EQUIVALENTS, AND RESTRICTED CASH: | | | | | | | Cash and cash equivalents | $ | 176,559 | | | $ | 162,132 | | | | | Restricted cash (1) | 17,998 | | | 13,031 | | | | | Total cash, cash equivalents, and restricted cash | $ | 194,557 | | | $ | 175,163 | | | | (1)Restricted cash balances are included in "prepaid expenses and other assets" on our consolidated balance sheets. NOTE 3—REAL ESTATEOn April 20, 2022, we acquired the fee interest in Kingstowne Towne Center, a 227,000 square foot shopping center located in Kingstowne, Virginia for $100.0 million. Approximately $4.3 million and $0.1 million of net assets acquired were allocated to other assets for "acquired lease costs" and "above market leases," respectively, and $10.5 million of net assets acquired were allocated to other liabilities for "below market leases." NOTE 4—DEBTOn June 29, 2022, we repaid the $16.1 million mortgage loan on one of the buildings at our Hoboken property, at par.During both the three and six months ended June 30, 2022, the maximum amount of borrowings outstanding under our $1.0 billion revolving credit facility was $114.0 million. The weighted average amount of borrowings outstanding was $57.7 million and $30.9 million, respectively, and the weighted average interest rate, before amortization of debt fees, was 2.0% and 1.9%, respectively, for the three and six months ended June 30, 2022. At June 30, 2022, our revolving credit facility had no balance outstanding.Effective April 1, 2022, as a result of the change in our credit rating, the spread over LIBOR on our revolving credit facility increased from 77.5 basis points to 82.5 basis, and the spread over LIBOR on our unsecured term loan increased from 80 basis points to 85 basis points.Our revolving credit facility, term loan, and certain notes require us to comply with various financial covenants, including the maintenance of minimum shareholders' equity and debt coverage ratios and a maximum ratio of debt to net worth. As of June 30, 2022, we were in compliance with all default related debt covenants. 15

string

Forfeited/canceled (in shares)

25

SEC-NUM

| | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | [Table of Contents](#i091a03213a4e4cb7a2bb5f39154aefe4_7) | Alphabet Inc. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Nine Months Ended September 30, | | | 2021 | | 2022 | | | Class A | | Class B | | Class C | | Class A | | Class B | | Class C | | Basic net income per share: | | | | | | | | | | | | | Numerator | | | | | | | | | | | | | Allocation of undistributed earnings | $ | 24,867 | | | $ | 3,776 | | | $ | 26,748 | | | $ | 21,213 | | | $ | 3,137 | | | $ | 21,998 | | | | | | | | | | | | | | | | Denominator | | | | | | | | | | | | | Number of shares used in per share computation | 6,010 | | | 912 | | | 6,464 | | | 6,004 | | | 888 | | | 6,226 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Basic net income per share | $ | 4.14 | | | $ | 4.14 | | | $ | 4.14 | | | $ | 3.53 | | | $ | 3.53 | | | $ | 3.53 | | | Diluted net income per share: | | | | | | | | | | | | | Numerator | | | | | | | | | | | | | | | | | | | | | | | | | | Allocation of undistributed earnings for basic computation | $ | 24,867 | | | $ | 3,776 | | | $ | 26,748 | | | $ | 21,213 | | | $ | 3,137 | | | $ | 21,998 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Reallocation of undistributed earnings as a result of conversion of Class B to Class A shares | 3,776 | | | 0 | | | 0 | | | 3,137 | | | 0 | | | 0 | | | Reallocation of undistributed earnings | (424) | | | (56) | | | 424 | | | (204) | | | (26) | | | 204 | | | Allocation of undistributed earnings | $ | 28,219 | | | $ | 3,720 | | | $ | 27,172 | | | $ | 24,146 | | | $ | 3,111 | | | $ | 22,202 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Denominator | | | | | | | | | | | | | Number of shares used in basic computation | 6,010 | | | 912 | | | 6,464 | | | 6,004 | | | 888 | | | 6,226 | | | Weighted-average effect of dilutive securities | | | | | | | | | | | | | Add: | | | | | | | | | | | | | Conversion of Class B to Class A shares outstanding | 912 | | | 0 | | | 0 | | | 888 | | | 0 | | | 0 | | | | | | | | | | | | | | | | Restricted stock units and other contingently issuable shares | 0 | | | 0 | | | 202 | | | 0 | | | 0 | | | 111 | | | Number of shares used in per share computation | 6,922 | | | 912 | | | 6,666 | | | 6,892 | | | 888 | | | 6,337 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Diluted net income per share | $ | 4.08 | | | $ | 4.08 | | | $ | 4.08 | | | $ | 3.50 | | | $ | 3.50 | | | $ | 3.50 | | For the periods presented above, the net income per share amounts are the same for Class A, Class B, and Class C stock because the holders of each class are entitled to equal per share dividends or distributions in liquidation in accordance with the Amended and Restated Certificate of Incorporation of Alphabet Inc.Note 12. Compensation PlansStock-Based CompensationFor the three months ended September 30, 2021 and 2022, total stock-based compensation (SBC) expense was $3.9 billion and $5.0 billion, including amounts associated with awards we expect to settle in Alphabet stock of $3.8 billion and $4.8 billion, respectively. For the nine months ended September 30, 2021 and 2022, total SBC expense was $11.7 billion and $14.4 billion, including amounts associated with awards we expect to settle in Alphabet stock of $11.2 billion and $13.8 billion, respectively. Stock-Based Award ActivitiesThe following table summarizes the activities for unvested Alphabet restricted stock units (RSUs) for the nine months ended September 30, 2022 (in millions, except per share amounts): | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | Unvested Restricted Stock Units | | | Number ofShares | | Weighted-AverageGrant-DateFair Value | | Unvested as of December 31, 2021 | 338 | | | $ | 81.31 | | | Granted | 199 | | | $ | 131.77 | | | Vested | (152) | | | $ | 87.13 | | | Forfeited/canceled | (25) | | | $ | 96.04 | | | Unvested as of September 30, 2022 | 360 | | | $ | 105.70 | | As of September 30, 2022, there was $35.7 billion of unrecognized compensation cost related to unvested RSUs. This amount is expected to be recognized over a weighted-average period of 2.7 years. 31

string

Performance Bonds and Other Performance Guarantees

118

SEC-NUM

[Table of Contents](#ib75a44f638b042a5a7472d3f3be80b22_7)We have arrangements with certain suppliers that require us to purchase minimum volumes or be subject to monetary penalties. At September 30, 2022, if we were to stop purchasing from each of these suppliers, the aggregate amount of the penalty would be approximately $138 million. These arrangements enable us to secure supplies of critical components and IT services. We do not currently anticipate paying any penalties under these contracts.We enter into physical forward contracts with suppliers of platinum and palladium to purchase certain volumes of the commodities at contractually stated prices for various periods, which generally fall within two years. At September 30, 2022, the total commitments under these contracts were $42 million. These arrangements enable us to guarantee the prices of these commodities, which otherwise are subject to market volatility.We have guarantees with certain customers that require us to satisfactorily honor contractual or regulatory obligations, or compensate for monetary losses related to nonperformance. These performance bonds and other performance-related guarantees were $118 million at September 30, 2022.Indemnifications Periodically, we enter into various contractual arrangements where we agree to indemnify a third-party against certain types of losses. Common types of indemnities include:•product liability and license, patent or trademark indemnifications;•asset sale agreements where we agree to indemnify the purchaser against future environmental exposures related to the asset sold; and •any contractual agreement where we agree to indemnify the counterparty for losses suffered as a result of a misrepresentation in the contract.We regularly evaluate the probability of having to incur costs associated with these indemnities and accrue for expected losses that are probable. Because the indemnifications are not related to specified known liabilities and due to their uncertain nature, we are unable to estimate the maximum amount of the potential loss associated with these indemnifications.Accounts Receivable Factoring We assumed an accounts receivable factoring program from the acquisition of Meritor for trade receivables as follows: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Current Expiration | | Total Facility Size at September 30, 2022 | | Utilized at September 30, 2022 | | In millions | | | EUR | | USD | | EUR | | USD | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Off-balance sheet arrangements | | | | | | | | | | | | Committed Swedish factoring facility(1)(2) | | March 2024 | | € | 155 | | | $ | 151 | | | € | 144 | | | $ | 139 | | | Committed U.S. factoring facility(1) | | February 2023 | | N/A | | 75 | | | — | | | 76 | | | Uncommitted U.K. factoring facility(3) | | February 2025 | | 25 | | | 24 | | | 2 | | | 2 | | | Uncommitted Italy factoring facility | | June 2025 | | 30 | | | 29 | | | 11 | | | 11 | | | Other uncommitted factoring facilities(4) | | None | | N/A | | N/A | | 7 | | | 7 | | | Total off-balance sheet arrangements | | | | € | 210 | | | $ | 279 | | | € | 164 | | | $ | 235 | | | | | | | | | | | | | | | | | (1) Actual amounts may exceed the bank's commitment at the bank's discretion. | | (2) The factoring program is supported by a 364-day committed credit facility through June 22, 2023. | | (3) The U.K. factoring facility enables the factoring of British pound and Euro denominated accounts receivable. | | (4) There is no explicit facility size under the agreement, but the counterparty approves the purchase of receivable tranches as its discretion. | | | | | | | | | | | | | | | We received $108 million of proceeds from receivables sold, and costs associated with all of the off-balance sheet arrangements described above were $1 million since the August 3, 2022, acquisition date. 22

string

Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months

3

SEC-NUM

| | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | [Table of Contents](#i0cc44b9a01a5457791ad0e0574b4c522_7) | | Note 6 - Derivatives | THE HARTFORD FINANCIAL SERVICES GROUP, INC.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | Offsetting Derivative Assets and Liabilities | | | (i) | (ii) | (iii) = (i) - (ii) | (iv) | (v) = (iii) - (iv) | | | | | Net Amounts Presented in the Statement of Financial Position | Collateral Disallowed for Offset in the Statement of Financial Position | | | | Gross Amounts of Recognized Assets (Liabilities) | Gross Amounts Offset in the Statement of Financial Position | Derivative Assets [1] (Liabilities) [2] | Accrued Interest and Cash Collateral (Received) [3] Pledged [2] | Financial Collateral (Received) Pledged [4] | Net Amount | | As of September 30, 2022 | | | | | | | | Other investments | $ | 102 | | $ | 98 | | $ | 12 | | $ | (8) | | $ | 3 | | $ | 1 | | | Other liabilities | $ | (16) | | $ | (5) | | $ | 74 | | $ | (85) | | $ | (9) | | $ | (2) | | | As of December 31, 2021 | | | | | | | | Other investments | $ | 17 | | $ | 13 | | $ | 7 | | $ | (3) | | $ | 4 | | $ | — | | | Other liabilities | $ | (59) | | $ | (10) | | $ | (49) | | $ | — | | $ | (47) | | $ | (2) | | [1]Included in other investments in the Company's Condensed Consolidated Balance Sheets.[2]Included in other liabilities in the Company's Condensed Consolidated Balance Sheets and is limited to the net derivative payable associated with each counterparty.[3]Included in other investments in the Company's Condensed Consolidated Balance Sheets and is limited to the net derivative receivable associated with each counterparty.[4]Excludes collateral associated with exchange-traded derivative instruments.CASH FLOW HEDGESFor derivative instruments that are designated and qualify as cash flow hedges, the gain or loss on the derivative is reported as a component of OCI and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. All components of each derivative’s gain or loss were included in the assessment of hedge effectiveness. | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | Gain (Loss) Recognized in OCI | | | | Three Months Ended September 30, | | Nine Months Ended September 30, | | | | | 2022 | 2021 | | 2022 | 2021 | | Interest rate swaps | | | $ | 8 | | $ | 2 | | | $ | 2 | | $ | 8 | | | Foreign currency swaps | | | 43 | | 8 | | | 93 | | 19 | | | Total | | | $ | 51 | | $ | 10 | | | $ | 95 | | $ | 27 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Gain (Loss) Reclassified from AOCI into Income | | | | | | | | Three months ended September 30, | | Nine Months Ended September 30, | | | | | 2022 | 2021 | 2022 | | 2021 | | | | | Net Investment Income | Interest Expense | Net Investment Income | Interest Expense | | Net Investment Income | Interest Expense | | Net Investment Income | Interest Expense | | | Interest rate swaps | | $ | (1) | | $ | — | | $ | 11 | | $ | (3) | | | $ | 13 | | $ | (4) | | | $ | 31 | | $ | (8) | | | | Foreign currency swaps | | 3 | | — | | 1 | | — | | | 7 | | — | | | 3 | | — | | | | Total | | $ | 2 | | $ | — | | $ | 12 | | $ | (3) | | | $ | 20 | | $ | (4) | | | $ | 34 | | $ | (8) | | | | | | | | | | | | | | | | | | Total amounts presented on the Condensed Consolidated Statement of Operations | | $ | 487 | | $ | 50 | | $ | 650 | | $ | 58 | | | $ | 1,537 | | $ | 163 | | | $ | 1,740 | | $ | 172 | | As of September 30, 2022, the before tax deferred net losses on derivative instruments recorded in AOCI that are expected to be reclassified to earnings during the next twelve months are $3. This expectation is based on the anticipated interest payments on hedged investments in fixed maturity securities and long-term debt that will occur over the next twelve months. At that time, the Company will recognize the deferred net gains (losses) as an adjustment to net investment income or interest expense, as applicable, over the term of the hedged instrument cash flows. During the three and nine months ended September 30, 2022 and 2021, the Company had no net reclassifications from AOCI to earnings resulting from the discontinuance of cash-flow hedges due to forecasted transactions that were no longer probable of occurring.33

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Amount funded for venture capital investments

125.1

SEC-NUM

CHARLES RIVER LABORATORIES INTERNATIONAL, INC.NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)The composition of other current assets is as follows: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | September 24, 2022 | | December 25, 2021 | | | (in thousands) | | Prepaid income tax | $ | 87,038 | | | $ | 84,725 | | | Short-term investments | 950 | | | 1,063 | | | Restricted cash | 1,376 | | | 4,023 | | | Other receivables | 7,723 | | | 7,500 | | | Other current assets | $ | 97,087 | | | $ | 97,311 | | The composition of other assets is as follows: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | September 24, 2022 | | December 25, 2021 | | | (in thousands) | | Venture capital investments | $ | 131,515 | | | $ | 149,640 | | | Strategic equity investments | 158,582 | | | 51,712 | | | Life insurance policies | 39,938 | | | 51,048 | | | Long-term pension assets | 33,491 | | | 39,582 | | | Other long-term income tax assets | 15,088 | | | 18,690 | | | Restricted cash | 1,100 | | | 1,077 | | | Other | 49,979 | | | 41,140 | | | Other assets | $ | 429,693 | | | $ | 352,889 | | The composition of other current liabilities is as follows: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | September 24, 2022 | | December 25, 2021 | | | (in thousands) | | Current portion of operating lease right-of-use liabilities | $ | 44,613 | | | $ | 33,267 | | | Customer contract deposits | 76,904 | | | 59,512 | | | Accrued income taxes | 47,036 | | | 26,161 | | | Other | 13,341 | | | 18,701 | | | Other current liabilities | $ | 181,894 | | | $ | 137,641 | | The composition of other long-term liabilities is as follows: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | September 24, 2022 | | December 25, 2021 | | | (in thousands) | | Long-term pension liability, accrued executive supplemental life insurance retirement plan and deferred compensation plans | $ | 100,552 | | | $ | 104,944 | | | U.S. Transition Tax | 32,324 | | | 43,057 | | | Long-term deferred revenue | 24,161 | | | 20,578 | | | Other | 37,673 | | | 74,280 | | | Other long-term liabilities | $ | 194,710 | | | $ | 242,859 | | 6. VENTURE CAPITAL AND STRATEGIC EQUITY INVESTMENTSVenture capital investments were $131.5 million and $149.6 million as of September 24, 2022 and December 25, 2021, respectively. The Company’s total commitment to the venture capital funds as of September 24, 2022 was $190.3 million, of which the Company funded $125.1 million through that date. The Company received distributions totaling $3.7 million and $10.2 million for the three months ended September 24, 2022 and September 25, 2021, respectively. The Company received distributions totaling $7.7 million and $37.7 million for the nine months ended September 24, 2022 and September 25, 2021, respectively. The Company recognized net gains on venture capital investments of $3.0 million and net losses of $10.3 million for the three months ended September 24, 2022 and September 25, 2021, respectively, both of which were driven primarily by publicly-held investments. The Company recognized net losses on venture capital investments of $20.1 million for the nine months ended 19

string

Expected volatility, maximum (as a percent)

47

SEC-NUM

[Table of Contents](#i300266b18f874ae1b9a15c90da441bb4_7) In February 2021, we modified the metrics and reduced the maximum potential payouts for our performance stock units granted in 2019 and 2020. The PSU granted in 2019 vested on January 2, 2022 and the PSU granted in 2020 vests at the end of the three-year period ending on January 1, 2023. The modifications affected 52 employees with units granted in 2019, which resulted in total incremental share-based compensation expense of approximately $41 million, and 72 employees with units granted in 2020, which resulted in total incremental share-based compensation expense of approximately $65 million.The assumptions used and the resulting estimate of weighted-average fair value per share for stock purchased under the ESPP during YTD 2022 were as follows: | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | Employee Stock Purchase Rights | | | | Risk-free interest rate | 0.06% - 0.78% | | | | Expected volatility | 37% - 47% | | | | Expected term | 0.5 - 1.0 year | | | | Expected dividends | 0 | % | | | | Weighted-average grant-date fair value per share | $ | 91.27 | | | | As of July 3, 2022, approximately $639 million of total unrecognized compensation cost related to restricted stock, stock options and ESPP shares issued to date was expected to be recognized over a weighted-average period of approximately 2.5 years. | | | | | --- | --- | --- | | | | | | 6. SUPPLEMENTAL BALANCE SHEET DETAILS | Accounts Receivable | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | In millions | July 3,2022 | | January 2,2022 | | Trade accounts receivable, gross | $ | 646 | | | $ | 651 | | | Allowance for credit losses | (4) | | | (3) | | | Total accounts receivable, net | $ | 642 | | | $ | 648 | | Inventory | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | In millions | July 3,2022 | | January 2,2022 | | Raw materials | $ | 202 | | | $ | 144 | | | Work in process | 366 | | | 333 | | | Finished goods | 32 | | | 32 | | | Inventory, gross | 600 | | | 509 | | | Inventory reserve | (82) | | | (78) | | | Total inventory, net | $ | 518 | | | $ | 431 | | Intangible Assets and GoodwillWe recorded a developed technology intangible asset of $23 million, with a useful life of 7 years, and a database intangible asset of $12 million, with a useful life of 7 years, as a result of an acquisition in Q2 2022. We are still finalizing the allocation of the purchase price as additional information is received to complete our analysis. We expect to finalize the valuation as soon as practicable, but no later than one year after the acquisition date.21

string

Incremental term loan, maximum aggregate amount available

200

SEC-NUM

Note C – Capitalization In June 2022, Con Edison redeemed at maturity $293 million of 8.71 percent senior unsecured notes. The carrying amounts and fair values of long-term debt at June 30, 2022 and December 31, 2021 were: | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | (Millions of Dollars) | 2022 | 2021 | | Long-Term Debt (including current portion) (a) | CarryingAmount | FairValue | CarryingAmount | FairValue | | Con Edison | $22,683 | $21,125 | $23,044 | $26,287 | | CECONY | $18,386 | $17,018 | $18,382 | $21,382 | (a)Amounts shown are net of unamortized debt expense and unamortized debt discount of $219 million and $188 million for Con Edison and CECONY, respectively, as of June 30, 2022 and $226 million and $193 million for Con Edison and CECONY, respectively, as of December 31, 2021. The fair values of the Companies' long-term debt have been estimated primarily using available market information and at June 30, 2022 are classified as Level 2 liabilities (see Note O). Note D – Short-Term BorrowingAt June 30, 2022, Con Edison had $2,244 million of commercial paper outstanding of which $2,060 million was outstanding under CECONY’s program. The weighted average interest rate at June 30, 2022 was 2.0 percent for both Con Edison and CECONY. At December 31, 2021, Con Edison had $1,488 million of commercial paper outstanding of which $1,361 million was outstanding under CECONY’s program. The weighted average interest rate at December 31, 2021 was 0.3 percent for both Con Edison and CECONY. At June 30, 2022 and December 31, 2021, no loans were outstanding under the Companies' December 2016 credit agreement (Credit Agreement). An immaterial amount of letters of credit were outstanding under the Credit Agreement as of June 30, 2022 and December 31, 2021. In March 2022, CECONY entered into a 364-Day Revolving Credit Agreement (the CECONY Credit Agreement) under which banks are committed to provide loans up to $750 million on a revolving credit basis. The CECONY Credit Agreement expires on March 30, 2023 and supports CECONY’s commercial paper program. Loans issued under the CECONY Credit Agreement may also be used for other general corporate purposes. The banks’ commitments under the CECONY Credit Agreement are subject to certain conditions, including that there be no event of default and that CECONY shall have received the required regulatory approval. The commitments are not subject to maintenance of credit rating levels or the absence of a material adverse change. Upon a change of control of, or upon an event of default by CECONY, the banks may terminate their commitments and declare the loans, accrued interest and any other amounts due by CECONY immediately due and payable. Events of default include CECONY exceeding at any time a ratio of consolidated debt to consolidated total capital of 0.65 to 1; having liens on its assets in an aggregate amount exceeding five percent of its consolidated total capital, subject to certain exceptions; CECONY failing to make one or more payments in respect of material financial obligations (in excess of an aggregate $150 million of debt); cross default to other financial obligations of $150 million or more of CECONY which would permit the holder to accelerate the obligations; and other customary events of default. In June 2022, Con Edison entered into and borrowed $400 million under a 364-Day Senior Unsecured Term Loan Credit Agreement dated June 30,2022 (the June 2022 Term Loan Credit Agreement) under which a bank is committed, until November 30, 2022, to provide to Con Edison one or more tranches of incremental term loans in an aggregate amount not to exceed $200 million, in addition to the $400 million borrowed on June 30, 2022. The bank’s commitments under the agreement are subject to certain conditions, including that there be no event of default. The commitments are not subject to maintenance of credit rating levels or the absence of a material adverse change. Upon a change of control of, or upon an event of default by Con Edison, the bank may terminate its commitments and declare the loans, accrued interest and any other amounts due by Con Edison immediately due and payable. Events of default include Con Edison exceeding at any time a ratio of consolidated debt to consolidated total capital of 0.65 to 1; Con Edison or its subsidiaries having liens on its or their assets in an aggregate amount exceeding 5 percent of Con Edison’s consolidated total capital, subject to certain exceptions; Con Edison or its material subsidiaries failing to make one or more payments in respect of material financial obligations (in excess of an aggregate $150 million of debt or derivative obligations other than non-recourse debt); the occurrence of an event or condition which results in the acceleration of the maturity of any material debt (in 30

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Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Long-term Debt

6

SEC-NUM

The Company accounted for the Acorda transaction using the acquisition method in accordance with ASC 805. The Company funded the entire purchase price with cash on hand and allocated the purchase price among the acquired assets, recognizing property, plant, and equipment of $79 million, inventory of $2 million, and goodwill of $2 million. The remainder of the purchase price was allocated to other current and non-current assets and liabilities assumed in the acquisition. Delphi Genetics SA Acquisition In February 2021, the Company acquired 100% of the equity interest in Delphi Genetics SA (“Delphi”) for $50 million. Delphi is a pDNA cell and gene therapy contract development and manufacturing organization based in Gosselies, Belgium. The facility and operations acquired became part of the Company’s Biologics segment. Results of the business acquired were not material to the Company's statement of operations, financial position, or cash flows for the fiscal years ended June 30, 2022 and 2021. The Company accounted for the Delphi transaction using the acquisition method in accordance with ASC 805. The Company funded the entire purchase price with cash on hand and allocated the purchase price among the acquired assets, recognizing property, plant, and equipment of $4 million, intangible assets of $7 million, other current assets of $3 million, assumed debt of $6 million, other current liabilities of $1 million and goodwill of $43 million. Hepatic Cell Therapy Support SA Asset Acquisition In April 2021, the Company acquired 100% of the equity interest in Hepatic Cell Therapy Support SA (“Hepatic”) for approximately $15 million, net of cash acquired and debt assumed. Hepatic operates a manufacturing facility at the same location where Skeletal operates a cell therapy manufacturing facility in Gosselies, Belgium. The facility acquired expands the Company’s cell therapy capacity for clinical and commercial supply in its Biologics segment. The Company accounted for the Hepatic transaction as an asset acquisition in accordance with ASC 805. The Company funded the entire purchase price with cash on hand and allocated the purchase price to the assets acquired and liabilities assumed, recognizing property, plant, and equipment of $13 million, other current and non-current assets of $3 million, and assumed debt of $1 million. RheinCell Therapeutics GmbH Acquisition In August 2021, the Company acquired 100% of the equity interest in RheinCell Therapeutics GmbH (“RheinCell”) for approximately $26 million, net of cash acquired. RheinCell is a developer and manufacturer of development and cGMP-grade iPSCs based in Lagenfeld, Germany. The operations became part of the Company’s Biologics segment and builds upon Catalent’s existing custom cell therapy process development and manufacturing capabilities with proprietary cGMP cell lines for iPSC-based therapies. The Company accounted for the RheinCell transaction using the acquisition method in accordance with ASC 805. The Company funded the entire purchase price with cash on hand and allocated the purchase price among the assets acquired, recognizing $4 million of current liabilities, $1 million of other liabilities, $14 million of intangible assets, and goodwill of $17 million. Results of this business were not material to the Company's statement of operations, financial position, or cash flows for the fiscal year ended June 30, 2022. Bettera Holdings, LLC Acquisition In October 2021, the Company acquired 100% of the equity interest in Bettera Wellness for approximately $1 billion, which was funded in part with net proceeds of the Company’s issuance of $650 million aggregate principal amount of 3.500% Senior Notes due 2030 (the “2030 Notes”) and in part with net proceeds from the Incremental Term B-3 Loans (as defined in Note 7, Long-Term Obligations and Short-Term Borrowings). Bettera Wellness is a manufacturer of nutraceuticals and nutritional supplements in gummy, soft chew, and lozenge delivery formats. The Company accounted for the Bettera Wellness transaction using the acquisition method in accordance with ASC 805. The Company estimated fair values at the date of acquisition for the allocation of consideration to the net tangible and intangible assets acquired and liabilities assumed. 82

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Allowance for doubtful accounts receivable, write-offs

134

SEC-NUM

[Table of Contents](#id0d7a71b05ce452ea9fdb54f3cb359c7_7)eBay Inc.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)Note 9 — Balance Sheet Components Contract Balances Timing of revenue recognition may differ from the timing of invoicing to customers. Accounts receivable represents amounts invoiced and revenue recognized prior to invoicing when we have satisfied our performance obligation and have the unconditional right to payment. The allowance for doubtful accounts and authorized credits is estimated based upon our assessment of various factors including historical experience, the age of the accounts receivable balances, current economic conditions reasonable and supportable forecasts and other factors that may affect our customers’ ability to pay. The allowance for doubtful accounts and authorized credits was $74 million and $136 million as of December 31, 2021 and December 31, 2020, respectively. As of December 31, 2021, we reported allowances for doubtful accounts of $42 million reflecting a decrease of $55 million, net of write-offs of $134 million for the year ended December 31, 2021. Deferred revenue consists of fees received related to unsatisfied performance obligations at the end of the period. Due to the generally short-term duration of contracts, the majority of the performance obligations are satisfied in the following reporting period. The amount of revenue recognized during the year ended December 31, 2021 that was included in the deferred revenue balance at the beginning of the period was $47 million. The amount of revenue recognized during the year ended December 31, 2020 that was included in the deferred revenue balance at the beginning of the period was $64 million. Cash, cash equivalents and restricted cash | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | December 31, | | 2021 | | 2020 | | (In millions) | | Cash and cash equivalents | $ | 1,379 | | | $ | 1,101 | | | Customer accounts | 5 | | | — | | | Restricted cash included in short-term investments | 22 | | | 137 | | | Cash, cash equivalents and restricted cash | $ | 1,406 | | | $ | 1,238 | | Customer accounts and funds receivable | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | December 31, | | | 2021 | | 2020 | | | (In millions) | | Cash and cash equivalents | $ | 5 | | | $ | — | | | Funds receivable | 676 | | | 290 | | | Customer accounts and funds receivable | $ | 681 | | | $ | 290 | | Other Current Assets | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | December 31, | | 2021 | | 2020 | | (In millions) | | Payment processor advances | $ | 453 | | | $ | 363 | | | Prepaid expenses | 114 | | | 109 | | | Other | 442 | | | 308 | | | Other current assets | $ | 1,009 | | | $ | 780 | | 94

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Parent Ownership Interest In ETT

50

SEC-NUM

ETT Rate Matters (Applies to AEP) ETT Interim Transmission Rates AEP has a 50% equity ownership interest in ETT. Predominantly all of ETT’s revenues are based on interim rate changes that can be filed twice annually and are subject to review and possible true-up in the next base rate proceeding. Through June 30, 2022, AEP’s share of ETT’s cumulative revenues that are subject to review is approximately $1.4 billion. A base rate review could produce a refund if ETT incurs a disallowance of the transmission investment on which an interim increase was based. A revenue decrease, including a refund of interim transmission rates, could reduce future net income and cash flows and impact financial condition. Management is unable to determine a range of potential losses, if any, that are reasonably possible of occurring. ETT is required to file for a comprehensive rate review no later than February 1, 2023, during which the $1.4 billion of cumulative revenues above will be subject to review. I&M Rate Matters (Applies to AEP and I&M) Michigan Power Supply Cost Recovery (PSCR) Reconciliation In April 2022, an Administrative Law Judge (ALJ) issued a Proposal for Decision (PFD) for I&M’s PSCR reconciliation for the 12-month period ending December 31, 2020, recommending the MPSC disallow approximately $8 million of purchased power costs that I&M incurred under the Inter-Company Power Agreement with OVEC and the Unit Power Agreement with AEGCo. In May 2022, I&M submitted exceptions to the ALJ’s PFD related to the recommended disallowance of purchased power costs described above. I&M anticipates that the MPSC will issue a final decision in the second half of 2022. Management is unable to predict the impact, if any, that the MPSC’s final decision may have on future results of operations, financial condition and cash flows. Indiana Earnings Test Filings I&M is required by Indiana law to submit an earnings test evaluation for the most recent one-year and five-year periods as part of I&M’s semi-annual Indiana FAC filings. These earnings test evaluations require I&M to include a credit in the FAC factor computation for periods in which I&M earned above its authorized return for both the one-year and five-year periods. The credit is determined as 50% of the lower of the one-year or five-year earnings above the authorized level. In the third quarter of 2022, I&M will submit its FAC filing and earnings test evaluation for the period ended May 2022. As of June 30, 2022, I&M’s financial statements adequately reflect the estimated impact of I&M’s upcoming Indiana earnings test filings. If it is determined that I&M’s over-earnings exceed what has been recorded, it could reduce future net income and cash flows and impact financial condition. 2022 Michigan Integrated Resource Plan (IRP) Filing In February 2022, I&M filed a request with the MPSC for approval of its 2022 IRP. Included in that filing were requests for approval and deferral of costs associated with resources commencing construction within three years of the Commission’s order in the filing. These resources include the new generation resources expected to be in-service by 2028, and demand-side resources, including load management programs and conservation voltage reduction investments. I&M is also requesting MPSC approval of I&M’s Rockport Unit 2 transition plan consistent with that approved by the IURC, including certain cost recovery related to remaining net book value of investments made during the term of the Rockport Unit 2 lease and future use of Rockport Unit 2 as a capacity resource. In addition, I&M has made requests for approval of a financial incentive on certain power purchase agreements and load management programs. In June 2022, intervening parties recommended various adjustments to I&M’s proposals, including the process I&M would use to receive approval of new generation resources, changes to or denial of requested financial incentives and requests for deferral and pre-approval of costs. Specific to I&M’s Rockport Unit 2 transition plan, certain intervening parties recommended that the MPSC order I&M to credit back to Michigan ratepayers the jurisdictional 161

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Rental expense for operating leases

169

SEC-NUM

[Table of Contents](#i769337f517694ce29a72abc52f207787_10) Notes to Consolidated Financial Statements — (Continued)Becton, Dickinson and Company Tax Holidays and PaymentsThe approximate tax impacts related to tax holidays in various countries in which the Company does business are provided below. The tax holidays expire at various dates through 2028. The Company’s income tax payments, net of refunds are also provided below. | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | (Millions of dollars, except per share amounts) | 2021 | | 2020 | | 2019 | | Tax impact related to tax holidays | $ | 248 | | | $ | 136 | | | $ | (43) | | | Impact of tax holiday on diluted earnings per share | 0.85 | | | 0.48 | | | (0.16) | | | Income tax payments, net of refunds | 670 | | | 518 | | | 536 | | Note 17 — LeasesThe Company leases real estate, vehicles and other equipment which are used in the Company’s manufacturing, administrative and research and development activities. The Company identifies a contract that contains a lease as one which conveys a right, either explicitly or implicitly, to control the use of an identified asset in exchange for consideration. The Company’s lease arrangements are generally classified as operating leases. These arrangements have remaining terms ranging from less than one year to approximately 25 years and the weighted-average remaining lease term of the Company’s leases is approximately 6.9 years. An option to renew or terminate the current term of a lease arrangement is included in the lease term if the Company is reasonably certain to exercise that option.The Company does not recognize a right-of-use asset and lease liability for short-term leases, which have terms of 12 months or less, on its consolidated balance sheet. For the longer-term lease arrangements that are recognized on the Company’s consolidated balance sheet, the right-of-use asset and lease liability is initially measured at the commencement date based upon the present value of the lease payments due under the lease. These payments represent the combination of the fixed lease and fixed non-lease components that are due under the arrangement. The costs associated with the Company’s short-term leases, as well as variable costs relating to the Company’s lease arrangements, are not material to its consolidated financial results.The implicit interest rates of the Company’s lease arrangements are generally not readily determinable and as such, the Company applies an incremental borrowing rate, which is established based upon the information available at the lease commencement date, to determine the present value of lease payments due under an arrangement. The weighted-average incremental borrowing rate that has been applied to measure the Company’s lease liabilities is 2.2%.The Company’s lease costs recorded in its consolidated statements of income for the years ended September 30, 2021 and 2020 were $132 million and $131 million, respectively, under the new lease accounting standard. Rental expense for all operating leases amounted to $169 million in 2019 under the previous accounting standard. Cash payments arising from the Company’s lease arrangements are reflected on its consolidated statement of cash flows as outflows used for operating activities. The right-of-use assets and lease liabilities recognized on the Company’s consolidated balance sheet as of September 30, 2021 and 2020 were as follows: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | (Millions of dollars) | 2021 | | 2020 | | Right-of-use assets recorded in Other Assets | $ | 446 | | | $ | 418 | | | Current lease liabilities recorded in Accrued expenses | 126 | | | 106 | | | Non-current lease liabilities recorded in Deferred Income Taxes and Other Liabilities | 344 | | | 336 | | 100

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Granted (in shares)

23.4

SEC-NUM

FORD MOTOR COMPANY AND SUBSIDIARIESNOTES TO THE FINANCIAL STATEMENTSNOTE 6. SHARE-BASED COMPENSATION (Continued) During 2021, activity for RSUs and RSSs was as follows (in millions, except for weighted-average fair value): | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | Shares | | Weighted-Average Fair Value | | | | Outstanding, beginning of year | 72.2 | | | $ | 8.35 | | | | | Granted (a) | 23.4 | | | 13.02 | | | | | Vested (a) | (24.1) | | | 9.01 | | | | | Forfeited | (9.0) | | | 10.73 | | | | | Outstanding, end of year (b) | 62.5 | | | 10.31 | | | | \_\_\_\_\_\_\_\_\_\_(a)Includes shares awarded to non-employee directors.(b)Excludes 821,082 non-employee director shares that were vested but unissued at December 31, 2021. Stock Options For the years ended December 31, 2020 and 2021, stock options outstanding were 26.9 million and 11.9 million, respectively, and stock options exercisable were 20.3 million and 7.5 million, respectively. During 2021, there were 11 million stock options exercised, with a weighted-average exercise price of $12.07. The exercised options prices ranged from $6.19 to $15.37 during 2021. We received approximately $133 million in proceeds with an equivalent of about $197 million in new issues used to settle the exercised options. For options exercised during the year ended December 31, 2021, the difference between the fair value of the Common Stock issued and the respective exercise price was $64 million. As of December 31, 2021, the intrinsic value for vested and unvested stock options was $51.6 million and $63.2 million, respectively. The average remaining terms for fully vested stock options and unvested stock options were 2.3 years and 8.5 years, respectively. Compensation cost for stock options for the year ended December 31, 2021 was $2 million. As of December 31, 2021, there was no unrecognized compensation cost related to non-vested stock options. During 2021, no new stock options were granted. NOTE 7. INCOME TAXES We recognize income tax-related penalties in Provision for/(Benefit from) income taxes on our consolidated income statements. We recognize income tax-related interest income and interest expense in Other income/(loss), net on our consolidated income statements. We account for U.S. tax on global intangible low-taxed income in the period incurred. Valuation of Deferred Tax Assets and Liabilities Deferred tax assets and liabilities are recognized based on the future tax consequences attributable to temporary differences that exist between the financial statement carrying value of assets and liabilities and their respective tax bases, and operating loss and tax credit carryforwards on a taxing jurisdiction basis. We measure deferred tax assets and liabilities using enacted tax rates that will apply in the years in which we expect the temporary differences to be recovered or paid. Our accounting for deferred tax consequences represents our best estimate of the likely future tax consequences of events that have been recognized on our consolidated financial statements or tax returns and their future probability. In assessing the need for a valuation allowance, we consider both positive and negative evidence related to the likelihood of realization of the deferred tax assets. If, based on the weight of available evidence, it is more likely than not that the deferred tax assets will not be realized, we record a valuation allowance.125

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Contract term

20-year

SEC-NUM

As required by 2018 regulation, CL&P and UI each entered into PURA-approved ten-year contracts in 2019 to purchase a combined total of approximately 9 million MWh annually from the Millstone Nuclear Power Station generation facility, which represents a combined amount of approximately 50 percent of the facility's output (approximately 40 percent by CL&P). The Millstone Nuclear Power Station has a 2,112 MW nameplate capacity. Energy deliveries and payments under these contracts began in 2019. Also as required by 2018 regulation, CL&P and UI each entered into PURA-approved eight-year contracts in 2019 to purchase a combined amount of approximately 18 percent of the Seabrook Nuclear Power Plant’s output (approximately 15 percent by CL&P) beginning January 1, 2022. The Seabrook Nuclear Power Plant has an approximate 1,250 MW nameplate capacity. The total estimated remaining future cost of the Millstone Nuclear Power Station and Seabrook Nuclear Power Plant energy purchase contracts are $3.3 billion and are reflected in the table above. CL&P sells the energy purchased under these contracts into the market and uses the proceeds from these energy sales to offset the contract costs. As the net costs under these contracts are recovered from customers in future rates, the contracts do not have an impact on the net income of CL&P. These contracts do not meet the definition of a derivative, and accordingly, the costs of these contracts are being accounted for as incurred. Excluded from the table above are long-term commitments of NSTAR Electric pertaining to the Massachusetts Clean Energy 83D contract, for which construction was suspended prior to December 31, 2021. Should the project attain feasibility and construction recommence, the estimated costs under the contract may potentially begin in 2023 and range between $150 million and $415 million per year under a 20-year contract, totaling approximately $6.7 billion. The contractual obligations table above does not include long-term commitments signed by CL&P and NSTAR Electric, as required by the PURA and DPU, respectively, for the purchase of renewable energy and related products that are contingent on the future construction of energy facilities. Natural Gas Procurement: Eversource's natural gas distribution businesses have long-term contracts for the purchase, transportation and storage of natural gas as part of its portfolio of supplies, which extend through 2045. Purchased Power and Capacity: These contracts include capacity CfDs of CL&P through 2026, and various IPP contracts or purchase obligations for electricity which extend through 2024 for CL&P, 2031 for NSTAR Electric and 2023 for PSNH. 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. CL&P's portion of the costs and benefits of these contracts will be paid by, or refunded to, CL&P's customers. The contractual obligations table above does not include CL&P's, NSTAR Electric's or PSNH's standard/basic service contracts for the purchase of energy supply, the amounts of which vary with customers' energy needs. Peaker CfDs: CL&P, along with UI, has three peaker CfDs for a total of approximately 500 MW of peaking capacity through 2042. CL&P has a sharing agreement with UI, whereby CL&P is responsible for 80 percent and UI for 20 percent of the net costs or benefits of these CfDs. The Peaker CfDs pay the generation facility owner the difference between capacity, forward reserve and energy market revenues and a cost-of-service payment stream for 30 years. The ultimate cost or benefit to CL&P under these contracts will depend on the costs of plant operation and the prices that the projects receive for capacity and other products in the ISO-NE markets. CL&P's portion of the amounts paid or received under the Peaker CfDs are recovered from, or refunded to, CL&P's customers. Transmission Support Commitments: Along with other New England utilities, CL&P, NSTAR Electric and PSNH entered into a series of agreements in the 1980’s to support the costs of, and receive rights to use, transmission and terminal facilities that were built to import electricity from the Hydro-Québec system in Canada. CL&P, NSTAR Electric and PSNH were obligated to pay, over a 30-year period that ended in 2020, their proportionate shares of the annual operation and maintenance expenses and capital costs of those facilities. On December 18, 2020, the parties to these agreements submitted to FERC an offer of settlement and amendments to these agreements implementing the terms of an extension for an additional 20-year period ending in 2040. On May 20, 2021, FERC approved this settlement, effective January 1, 2021. The total costs incurred under these agreements were as follows: | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | Eversource | For the Years Ended December 31, | | (Millions of Dollars) | 2021 | | 2020 | | 2019 | | Renewable Energy | $ | 609.2 | | | $ | 584.2 | | | $ | 320.8 | | | Natural Gas Procurement | 712.7 | | | 453.4 | | | 448.5 | | | Purchased Power and Capacity | 56.4 | | | 62.7 | | | 62.1 | | | Peaker CfDs | 24.3 | | | 22.7 | | | 13.0 | | | Transmission Support Commitments | 15.4 | | | 22.1 | | | 21.8 | | 121

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Value of consideration not acquired

15.7

SEC-NUM

CHARLES RIVER LABORATORIES INTERNATIONAL, INC.NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)through cGMP production. The purchase price of Cognate was $877.9 million, net of $70.5 million in cash and includes $15.7 million of consideration for an approximate 2% ownership interest not acquired, which was redeemed in April 2022 with the ultimate payout tied to performance in 2021. The acquisition was funded through a combination of available cash and proceeds from the Company’s Credit Facility and senior notes (Senior Notes) issued in fiscal 2021. This business is reported as part of the Company’s Manufacturing reportable segment. Distributed Bio, Inc.On December 31, 2020, the Company acquired Distributed Bio, Inc. (Distributed Bio), a next-generation antibody discovery company with technologies specializing in enhancing the probability of success for delivering high-quality, readily formattable antibody fragments to support antibody and cell and gene therapy candidates to biopharmaceutical clients. The acquisition of Distributed Bio expands the Company’s capabilities with an innovative, large-molecule discovery platform, and creates an integrated, end-to-end platform for therapeutic antibody and cell and gene therapy discovery and development. The purchase price of Distributed Bio was $97.0 million, net of $0.8 million in cash. The total consideration includes $80.8 million cash paid, settlement of $3.0 million in convertible promissory notes previously issued by the Company during prior fiscal years, and $14.1 million of contingent consideration, which was estimated using a Monte Carlo Simulation model (the maximum contingent contractual payments are up to $21.0 million based on future performance and milestone achievements over a one-year period). The acquisition was funded through a combination of available cash and proceeds from the Company’s Credit Facility. This business is reported as part of the Company’s DSA reportable segment. During the nine months ended September 24, 2022, $7.0 million of contingent consideration was paid as certain operational milestones were achieved. As of September 24, 2022, other financial targets associated with the contingent consideration were not met and the fair value of the remaining contingent consideration is zero.Other AcquisitionOn March 3, 2021, the Company acquired certain assets from a distributor that supports the Company’s DSA reportable segment. The purchase price was $35.4 million, which includes $19.5 million in cash paid ($5.5 million of which was paid in fiscal 2020), and $15.9 million of contingent consideration, which was estimated using a Monte Carlo Simulation model (the maximum contingent contractual payments are up to $17.5 million based on future performance over a three-year period). The fair value of the net assets acquired included $17.3 million of goodwill, $15.2 million attributed to supplier relationships (to be amortized over a 4-year period), and $3.0 million of property, plant, and equipment. The business is reported as part of the Company’s DSA reportable segment. As of September 24, 2022, the fair value of the contingent consideration was zero as certain operational targets were not achieved.11

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Legal settlement term (in years)

18

SEC-NUM

Note 10. Legal Matters and ContingenciesIn the ordinary course of its business, the Company becomes involved in lawsuits, administrative proceedings, government subpoenas, government investigations, stockholder demands, and other disputes, including antitrust, commercial, product liability, intellectual property, regulatory, employment discrimination, and other matters. Significant damages or penalties may be sought from the Company in some matters, and some matters may require years for the Company to resolve. The Company records a reserve for these matters when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated.For those matters for which the Company has not recognized a liability, the Company cannot predict the outcome of their impact on the Company as uncertainty remains with regard to whether such matters will proceed to trial, whether settlements will be reached, and the amount and terms of any such settlements. Outcomes may include settlements in significant amounts that are not currently estimable, limitations on the Company's conduct, the imposition of corporate integrity agreement obligations, consent decrees, and/or other civil and criminal penalties. From time to time, the Company is also involved in disputes with its customers, which the Company generally seeks to resolve through commercial negotiations. If negotiations are unsuccessful, the parties may litigate the dispute or otherwise attempt to settle the matter.With respect to the specific legal proceedings and claims described below, unless otherwise noted, the amount or range of possible losses is not reasonably estimable. There can be no assurance that the settlement, resolution, or other outcome of one or more matters, including the matters set forth below, during any subsequent reporting period will not have a material adverse effect on the Company's results of operations or cash flows for that period or on the Company's financial condition.Opioid Lawsuits and InvestigationsA significant number of counties, municipalities, and other governmental entities in a majority of U.S. states and Puerto Rico, as well as numerous states and tribes, have filed lawsuits in various federal, state and other courts against pharmaceutical wholesale distributors (including the Company and certain subsidiaries, such as AmerisourceBergen Drug Corporation ("ABDC") and H.D. Smith), pharmaceutical manufacturers, retail pharmacy chains, medical practices, and physicians relating to the distribution of prescription opioid pain medications. Other lawsuits regarding the distribution of prescription opioid pain medications have been filed by: third-party payors and similar entities; hospitals; hospital groups; and individuals, including cases styled as putative class actions. The lawsuits, which have been and continue to be filed in federal, state, and other courts, generally allege violations of controlled substance laws and various other statutes as well as common law claims, including negligence, public nuisance, and unjust enrichment, and seek equitable relief and monetary damages. An initial group of cases was consolidated for Multidistrict Litigation ("MDL") proceedings before the United States District Court for the Northern District of Ohio (the "Court") in December 2017. Additional cases were added to the MDL from 2018 through 2022. In April 2018, the Court issued an order creating a litigation track, which includes dispositive motion practice, discovery, and trials in certain bellwether jurisdictions. In December 2018, the Court issued an order selecting two cases for a second bellwether discovery and trial track. In November 2019 and January 2020, the Court filed Suggestions of Remand with the Judicial Panel on Multidistrict Litigation that identified four cases filed against the Company, including the two cases in the second bellwether trial track, for potential transfer from the MDL back to federal courts in California, Oklahoma, and West Virginia for the completion of discovery, motion practice, and trial. All four cases were remanded to those federal district courts. Trial in the two consolidated cases in West Virginia commenced in May 2021 and concluded in July 2021. On July 4, 2022, the court entered judgment in favor of the defendants, including the Company. The plaintiffs filed an appeal of the court's decision on August 2, 2022. The Oklahoma case, in which the plaintiff was the Cherokee Nation, was resolved through a settlement with the Cherokee Nation, as announced on September 28, 2021. The California case, in which the plaintiff was the City and County of San Francisco, was resolved pursuant to the comprehensive settlement reached with the majority of U.S. states, including California, as described below, and all claims against the Company have been dismissed in both cases. On July 21, 2021, the Company announced that it and the two other national pharmaceutical distributors had negotiated a comprehensive settlement agreement that, if all conditions were satisfied, would result in the resolution of a substantial majority of opioid lawsuits filed by state and local governmental entities. On April 2, 2022, the settlement agreement became effective as to the Company and 46 settling states (the "Settling States"), as well as over 98% by population of the eligible political subdivisions in the Settling States. The States of Washington and Oklahoma intend to join the comprehensive settlement after certain conditions have been met in those states. Pursuant to the comprehensive settlement agreement and related agreements with Settling States, including previously disclosed settlement agreements with Florida, New York, Ohio, Rhode Island and Texas, the Company will pay approximately $5.9 billion over 18 years and comply with other requirements, including establishment of a clearinghouse that will consolidate data from all three national distributors. The exact payment amount will depend on several factors, including the extent to which states take action to foreclose opioid lawsuits by subdivisions (e.g., laws barring opioid lawsuits by subdivisions), and the extent to which subdivisions in Settling States file 17

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Direct financing lease, net investment in lease, before allowance for credit loss

39.2

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

string

Total liabilities assumed

30,426

SEC-NUM

[Table of](#i090043fcb1da400aaac214abf3d3ee98_7) [Contents](#i090043fcb1da400aaac214abf3d3ee98_7)Remaining Performance ObligationsRevenue allocated to remaining performance obligations represents the transaction price allocated to the performance obligations that are unsatisfied, or partially unsatisfied, which includes unearned revenue and amounts that will be invoiced and recognized as revenue in future periods. Cadence has elected to exclude the potential future royalty receipts from the remaining performance obligations. Contracted but unsatisfied performance obligations were approximately $4.4 billion as of January 1, 2022, which included $119.5 million of non-cancellable IPAA commitments from customers where actual product selection and quantities of specific products or services are to be determined by customers at a later date. As of January 1, 2022, Cadence expected to recognize approximately 55% of the contracted but unsatisfied performance obligations, excluding non-cancellable IPAA commitments, as revenue over the next 12 months and the remainder thereafter.Cadence recognized revenue of $47.1 million, $51.2 million and $40.4 million during fiscal 2021, 2020 and 2019, respectively, from performance obligations satisfied in previous periods. These amounts represent royalties earned during the period and exclude contracts with nonrefundable prepaid royalties. Nonrefundable prepaid royalties are recognized upon delivery of the IP because Cadence’s right to the consideration is not contingent upon customers’ future shipments.NOTE 6. ACQUISITIONS 2021 AcquisitionsOn February 23, 2021, Cadence acquired all of the outstanding equity of Belgium-based Numerical Mechanics Applications International SA (“NUMECA”). The addition of NUMECA’s technologies and talent supports Cadence’s Intelligent System Design™ strategy, servicing the computational fluid dynamics (“CFD”) market segment as part of System Design and Analysis. The aggregate cash consideration for Cadence’s acquisition of NUMECA, net of cash acquired of $9.6 million, was $188.6 million. Cadence expects to recognize expense for consideration paid to certain former NUMECA shareholders that is subject to service and other conditions, through the first quarter of fiscal 2023.The total purchase consideration was allocated to the assets acquired and liabilities assumed with Cadence’s acquisition of NUMECA based on their respective estimated fair values on the acquisition date as follows: | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | Acquisition Date Fair Value | | | (In thousands) | | Current assets | $ | 16,423 | | | Goodwill | 133,077 | | | Acquired intangibles | 72,200 | | | Other long-term assets | 6,928 | | | Total assets acquired | 228,628 | | | Current liabilities | 9,951 | | | Long-term liabilities | 20,475 | | | Total liabilities assumed | 30,426 | | | Total purchase consideration | $ | 198,202 | | The recorded goodwill is attributed to intangible assets that do not qualify for separate recognition, including the acquired assembled workforce and expected synergies from combining operations of NUMECA with Cadence. Cadence expects all of the goodwill related to the acquisition of NUMECA to be deductible for tax purposes.On April 14, 2021, Cadence acquired all of the outstanding equity of Pointwise, Inc. (“Pointwise”), a leader in mesh generation for CFD for cash consideration of approximately $31.4 million, net of cash acquired. The addition of Pointwise’s technologies and experienced team supports Cadence’s Intelligent System Design strategy and further broadens its System Design and Analysis portfolio, complementing its acquisition of NUMECA. The total purchase consideration was allocated to the assets acquired and liabilities assumed based on their respective estimated fair values on the acquisition dates. Cadence recorded $16.7 million of definite-lived intangible assets and $16.7 million of goodwill with its acquisition of Pointwise. All of the goodwill related to Cadence’s acquisition of Pointwise is expected to be deductible for tax purposes.Cadence completed two additional acquisitions during fiscal 2021. These acquisitions are not material to the consolidated financial statements.64

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Gain (loss) on sale of business, pre-tax

1.7

SEC-NUM

Note 4 – Mergers, Acquisitions and Divestitures A.Divestiture of International Businesses On July 1, 2022, the Company completed the sale of its life, accident and supplemental benefits businesses in six countries (Hong Kong, Indonesia, New Zealand, South Korea, Taiwan and Thailand) to Chubb for approximately $5.4 billion in cash. The Company recognized a gain of $1.7 billion pre-tax ($1.4 billion after-tax), which includes recognition of previously unrealized capital losses on investments sold and translation loss on foreign currencies (see Note 14 for further information). Also see Note 5 for further information regarding the assets and liabilities of these divested businesses. B.Acquisition of MDLIVE On April 19, 2021, Cigna acquired 97% of MDLIVE, Inc. ("MDLIVE"), a 24/7 virtual care platform. Combined with Cigna's previously held equity investment, Cigna now owns 100% of MDLIVE. The Company's 2021 Form 10-K includes detailed disclosures of merger consideration, purchase price allocation and intangible assets identified in this transaction. In accordance with GAAP, the total consideration transferred has been allocated to the tangible and intangible net assets acquired based on management's estimates of their fair values and was finalized as of March 31, 2022 with immaterial changes to the purchase price allocation. The results of MDLIVE have been included in the Company's Consolidated Financial Statements from the date of the acquisition. We remain on track and are nearly complete with MDLIVE integration activities. Revenues from MDLIVE and their results of operations were not material to Cigna's consolidated results of operations for the three and nine months ended September 30, 2021. The pro forma effects of this acquisition for prior periods were not material to our consolidated results of operations.C.Integration and Transaction-related CostsIn the first nine months of 2022 and 2021, the Company incurred costs related to the acquisition of MDLIVE, the sale of the U.S. Group Disability and Life business and the terminated merger with Elevance Health, Inc. ("Elevance"), formerly known as Anthem, Inc. In the first nine months of 2022, the Company also incurred costs related to the Chubb transaction. These costs were $24 million pre-tax ($23 million after-tax) for the three months ended and $112 million pre-tax ($86 million after-tax) for the nine months ended September 30, 2022, compared with $13 million pre-tax ($(35) million after-tax) for the three months ended and $58 million pre-tax ($1 million after-tax) for the nine months ended September 30, 2021. These costs consisted primarily of certain projects to separate or integrate the Company's systems, products and services, fees for legal, advisory and other professional services and certain employment-related costs. After-tax costs for the three and nine months ended September 30, 2021 included a tax benefit from the resolution of a tax matter related to the sold Group Disability and Life business. 13

string

Payments to Acquire Noncontrolling Interest

1,050

SEC-NUM

[Table of Contents](#i7f92822ddf844c24912627bf68509b56_7) COSTCO WHOLESALE CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS(amounts in millions, except share, per share, and warehouse count data)Note 1—Summary of Significant Accounting PoliciesDescription of BusinessCostco Wholesale Corporation (Costco or the Company), a Washington corporation, and its subsidiaries operate membership warehouses based on the concept that offering members low prices on a limited selection of nationally-branded and private-label products in a wide range of merchandise categories will produce high sales volumes and rapid inventory turnover. At August 28, 2022, Costco operated 838 warehouses worldwide: 578 in the United States (U.S.) located in 46 states, Washington, D.C., and Puerto Rico, 107 in Canada, 40 in Mexico, 31 in Japan, 29 in the United Kingdom (U.K.), 17 in Korea, 14 in Taiwan, 13 in Australia, four in Spain, two each in France and China, and one in Iceland. The Company operates e-commerce websites in the U.S., Canada, U.K., Mexico, Korea, Taiwan, Japan, and Australia.Basis of PresentationThe consolidated financial statements include the accounts of Costco, its wholly-owned subsidiaries, and subsidiaries in which it has a controlling interest. The Company reports noncontrolling interests in consolidated entities as a component of equity separate from the Company’s equity. All material inter-company transactions between and among the Company and its consolidated subsidiaries have been eliminated in consolidation. During 2022, the Company paid a cash dividend of $208 and purchased the equity interest of its Taiwan operations from its former joint-venture partner for $842, totaling $1,050 in the aggregate. The remaining noncontrolling interest represents the portion of equity interests in a consolidated joint venture that is not 100% owned by the Company. Unless otherwise noted, references to net income relate to net income attributable to Costco.Fiscal Year EndThe Company operates on a 52/53-week fiscal year basis with the year ending on the Sunday closest to August 31. References to 2022, 2021, and 2020 relate to the 52-week fiscal years ended August 28, 2022, August 29, 2021, and August 30, 2020, respectively. Use of EstimatesThe preparation of financial statements in conformity with U.S. generally accepted accounting principles (U.S. GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates and assumptions take into account historical and forward-looking factors that the Company believes are reasonable. Actual results could differ from those estimates and assumptions.ReclassificationReclassifications were made to our 2021 and 2020 consolidated statements of income and cash flows to conform with current year presentation.Cash and Cash EquivalentsThe Company considers as cash and cash equivalents all cash on deposit, highly liquid investments with a maturity of three months or less at the date of purchase, and proceeds due from credit and debit card transactions with settlement terms of up to four days. Credit and debit card receivables were $2,010 and $1,816 at the end of 2022 and 2021.41

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Derivatives

4

SEC-NUM

of the UK where the applicable tax rates are higher than the UK statutory tax rate. The fiscal year 2020 foreign tax rate differential reflects a benefit related to Swiss tax law changes, which was mostly offset by current period tax charges related to true-up adjustments. Refer to the section "Swiss Tax Reform" in this footnote for a discussion of the impacts of the Swiss tax law changes which the Company recognized in the last three fiscal years. Significant components of deferred tax assets and liabilities are as follows: | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | June 30, | | ($ in millions) | | 2022 | | 2021 | | Deferred tax assets | | | | | | Inventories | | $ | 15 | | | $ | 22 | | | Accrued employee benefits | | 62 | | | 101 | | | Provisions | | 18 | | | 10 | | | Net operating loss carryforwards | | 325 | | | 293 | | | Tax credit carryforwards | | 39 | | | 40 | | | Accruals and other | | 48 | | | 63 | | | Total deferred tax assets | | 507 | | | 529 | | | Valuation allowance | | (407) | | | (403) | | | Net deferred tax assets | | 100 | | | 126 | | | Deferred tax liabilities | | | | | | Property, plant, and equipment | | (319) | | | (325) | | | Other intangible assets, including gross impacts from Swiss tax reform | | (304) | | | (326) | | | Trade receivables | | — | | | (7) | | | Derivatives | | (4) | | | — | | | Undistributed foreign earnings | | (20) | | | (25) | | | Total deferred tax liabilities | | (647) | | | (683) | | | Net deferred tax liability | | (547) | | | (557) | | | Balance sheet location: | | | | | | Deferred tax assets | | 130 | | | 139 | | | Deferred tax liabilities | | (677) | | | (696) | | | Net deferred tax liability | | $ | (547) | | | $ | (557) | | The Company maintains a valuation allowance on net operating losses and other deferred tax assets in jurisdictions for which it does not believe it is more likely than not to realize those deferred tax assets based upon all available positive and negative evidence, including historical operating performance, carry-back periods, reversal of taxable temporary differences, tax planning strategies, and earnings expectations. The Company's valuation allowance increased by $4 million, by $40 million, and by $73 million for fiscal year 2022, 2021, and 2020, respectively. As of June 30, 2022 and 2021, the Company had total net operating loss carry forwards, including capital losses, in the amount of $1,178 million and $1,085 million, respectively, and tax credits in the amount of $39 million and $40 million, respectively. The vast majority of the losses and tax credits do not expire. The Company considers the following factors, among others, in evaluating its plans for indefinite reinvestment of its subsidiaries' earnings: (i) the forecasts, budgets, and financial requirements of the Company and its subsidiaries, both for the long-term and for the short-term; and (ii) the tax consequences of any decision to repatriate or reinvest earnings of any subsidiary. As of June 30, 2022, the Company has not provided deferred taxes on approximately $1,093 million of earnings in certain foreign subsidiaries because such earnings are indefinitely reinvested in its international operations. Upon distribution of such earnings in the form of dividends or otherwise, the Company may be subject to incremental foreign tax. It is not practicable to estimate the amount of foreign tax that might be payable. As of June 30, 2022, a cumulative deferred tax liability of $20 million has been recorded attributable to undistributed earnings that the Company has deemed are no longer indefinitely reinvested. The remaining undistributed earnings of the Company's subsidiaries are not deemed to be indefinitely reinvested and can be repatriated at no tax cost. Accordingly, there is no provision for income or withholding taxes on these earnings. 91

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Preferred stock, fixed dividend rate

5

SEC-NUM

Preferred stock outstanding comprises $5,694 million of GE Series D preferred stock, in addition to $245 million of existing GE Series A, B and C preferred stock. The total carrying value of GE preferred stock at December 31, 2021 was $5,935 million and will increase to $5,940 million by the respective call dates through periodic accretion. Dividends on GE preferred stock are payable semi-annually in June and December and accretion is recorded on a quarterly basis. Dividends on GE preferred stock totaled $237 million, including cash dividends of $220 million, $474 million, including cash dividends of $295 million, and $460 million, including cash dividends of $295 million, for the years ended December 31, 2021, 2020 and 2019, respectively. On January 21, 2021, the GE Series D preferred stock became callable and its dividends converted from 5% fixed rate to 3-month LIBOR plus 3.33%. As of the filing date of this Form 10-K for the year ended December 31, 2021, the GE Series D preferred stock has not been called. GE has 50 million authorized shares of preferred stock ($1.00 par value), of which 5,939,875 shares are outstanding as of December 31, 2021, 2020 and 2019. GE's authorized common stock consists of 1,650 million shares having a par value of $0.01 each, with 1,462 million shares issued. To facilitate settlement of employee compensation programs, we repurchased shares of 0.5 million and 0.1 million, for a total of $35.8 million and $15.3 million for the years ended December 31, 2021 and 2020, respectively. Redeemable noncontrolling interests, presented within All other liabilities in our Statement of Financial Position, include common shares issued by our affiliates that are redeemable at the option of the holder of those interests and amounted to $148 million and $487 million as of December 31, 2021 and 2020, respectively. The decrease of $339 million was primarily due to a redeemable noncontrolling interest in our Aviation segment, which was converted into a mandatorily redeemable instrument and reclassified to All other current liabilities. NOTE 16. SHARE-BASED COMPENSATION. We grant stock options, restricted stock units and performance share units to employees under the 2007 Long-Term Incentive Plan. Grants made under all plans must be approved by the Management Development and Compensation Committee of GE’s Board of Directors, which is composed entirely of independent directors. We record compensation expense for awards expected to vest over the vesting period. We estimate forfeitures based on experience and adjust expense to reflect actual forfeitures. When options are exercised, restricted stock units vest, and performance share awards are earned, we issue shares from treasury stock. Where applicable, the disclosures below have been adjusted to reflect the 1-for-8 reverse stock split effective July 30, 2021. Stock options provide employees the opportunity to purchase GE shares in the future at the market price of our stock on the date the award is granted (the strike price). The options become exercisable over the vesting period, typically three years, and expire 10 years from the grant date if not exercised. Restricted stock units (RSU) provide an employee with the right to receive one share of GE stock when the restrictions lapse over the vesting period. Upon vesting, each RSU is converted into one share of GE common stock for each unit. Performance share units (PSU) and performance shares provide an employee with the right to receive shares of GE stock based upon achievement of certain performance or market metrics. Upon vesting, each PSU earned is converted into shares of GE common stock. We value stock options using a Black-Scholes option pricing model, RSUs using market price on grant date, and PSUs and performance shares using market price on grant date and a Monte Carlo simulation as needed based on performance metrics. | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | WEIGHTED AVERAGE GRANT DATE FAIR VALUE | | 2021 | 2020 | 2019 | | Stock options | | $ | 40.64 | | $ | 28.64 | | $ | 27.84 | | | RSUs | | 104.98 | | 63.28 | | 80.96 | | | PSUs/Performance shares | | 108.51 | | 63.28 | | 85.84 | Key assumptions used in the Black-Scholes valuation for stock options include: risk free rates of 1.1%, 1.0%, and 2.5%, dividend yields of 0.3%, 0.4%, and 0.4%, expected volatility of 40%, 36%, and 33%, expected lives of 6.2 years, 6.1 years, and 6.0 years, and strike prices of $105.12, $84.48, and $80.00 for 2021, 2020, and 2019, respectively. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | STOCK-BASED COMPENSATION ACTIVITY | Stock options | | RSUs | | Shares (in thousands) | Weighted average exercise price | Weighted average contractual term (in years) | Intrinsic value (in millions) | | Shares (in thousands) | Weighted average grant date fair value | Weighted average contractual term (in years) | Intrinsic value (in millions) | | Outstanding at January 1, 2021 | 50,046 | | $ | 145.26 | | | | | 7,561 | | $ | 72.35 | | | | | Granted | 494 | | 105.12 | | | | | 2,972 | | 104.98 | | | | | Exercised | (1,252) | | 74.19 | | | | | (1,639) | | 97.91 | | | | | Forfeited | (933) | | 80.31 | | | | | (837) | | 82.81 | | | | | Expired | (9,941) | | 159.46 | | | | | N/A | N/A | | | | Outstanding at December 31, 2021 | 38,414 | | $ | 144.97 | | 4.2 | $ | 193 | | | 8,057 | | $ | 77.90 | | 1.6 | $ | 761 | | | Exercisable at December 31, 2021 | 33,551 | | 153.11 | | 3.6 | 148 | | | N/A | N/A | N/A | N/A | | Expected to vest | 4,557 | | $ | 88.70 | | 7.9 | $ | 42 | | | 6,830 | | $ | 78.75 | | 1.5 | $ | 645 | | Total outstanding PSUs and performance shares at December 31, 2021 were 3,215 thousand shares with a weighted average fair value of $75.66. The intrinsic value and weighted average contractual term of PSUs and performance shares outstanding were $304 million and 2.3 years, respectively. 2021 FORM 10-K 75

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Number of maturity days from date of issuance

397

SEC-NUM

10. SECURED AND UNSECURED SENIOR DEBT (continued) The following table summarizes our secured and unsecured senior debt and amounts outstanding under our unsecured senior line of credit and commercial paper program as of September 30, 2022 (dollars in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Fixed-Rate Debt | | Variable-Rate Debt | | | | | | Weighted-Average | | | | | | | | | | Interest | | Remaining Term(in years) | | | | | | Total | | Percentage | | Rate(1) | | | | Secured notes payable | $ | 650 | | | $ | 39,944 | | | $ | 40,594 | | | 0.4 | % | | 5.36 | % | | 4.3 | | | Unsecured senior notes payable | 10,098,588 | | | — | | | 10,098,588 | | | 95.9 | | | 3.51 | | | 13.5 | | | Unsecured senior line of credit and commercial paper program | — | | | 386,666 | | | 386,666 | | (2) | 3.7 | | | 3.48 | (2) | 5.3 | (3) | | Total/weighted average | $ | 10,099,238 | | | $ | 426,610 | | | $ | 10,525,848 | | | 100.0 | % | | 3.52 | % | | 13.2 | (3) | | Percentage of total debt | 95.9 | % | | 4.1 | % | | 100.0 | % | | | | | | | | (1)Represents the weighted-average interest rate as of the end of the applicable period, including expense/income related to the amortization of loan fees, amortization of debt premiums (discounts), and other bank fees.(2)As of September 30, 2022, we had no outstanding balance on our unsecured senior line of credit. Our unsecured senior line of credit has aggregate commitments of $4.0 billion and bears an interest rate of SOFR plus 0.875%. In addition, the rate is subject to a sustainability adjustment of +/- four basis points based upon our ability to achieve certain annual sustainability targets. As of September 30, 2022, we had $386.7 million of commercial paper notes outstanding with a weighted-average interest rate of 3.48%.(3)We calculate the weighted-average remaining term of our commercial paper notes by using the maturity date of our unsecured senior line of credit. Using the maturity date of our outstanding commercial paper, the consolidated weighted-average maturity of our debt is 13.0 years. The commercial paper notes sold during the three months ended September 30, 2022 were issued at a weighted-average yield to maturity of 2.69% and had a weighted-average maturity term of 13 days. Unsecured senior notes payable In February 2022, we opportunistically issued $1.8 billion of unsecured senior notes payable with a weighted-average interest rate of 3.28% and a weighted-average maturity of 22.0 years. The unsecured senior notes consisted of $800.0 million of 2.95% green unsecured senior notes due 2034 and $1.0 billion of 3.55% unsecured senior notes due 2052. Amendment of our unsecured senior line of credit On September 22, 2022, we amended our unsecured senior line of credit and the key changes are summarized below: | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | New Agreement | | Change | | Commitments available for borrowing | | | $4.0 billion | | | Up $1.0 billion | | Maturity date | | | January 22, 2028 | | | Extended by 2 years | | Interest rate | | | SOFR+0.875% | | | Converted to SOFR from LIBOR | | | | | | | | | In addition, the interest rate under our amended unsecured senior line of credit is subject to upward or downward adjustments of up to four basis points based upon our ability to achieve certain annual sustainability targets. As of September 30, 2022, we had no outstanding balance on our unsecured senior line of credit. $2.0 billion commercial paper program In September 2022, we increased the aggregate amount we may issue from time to time under our commercial paper program to $2.0 billion from $1.5 billion. Our commercial paper program provides us with the ability to issue up to $2.0 billion of commercial paper notes that bear interest at short-term fixed rates with a maturity of generally 30 days or less and with a maximum maturity of 397 days from the date of issuance. Our commercial paper program is backed by our unsecured senior line of credit, and at all times we expect to retain a minimum undrawn amount of borrowing capacity under our unsecured senior line of credit equal to any outstanding notes issued under our commercial paper program. We use the net proceeds from the issuances of the notes for general working capital and other general corporate purposes. General corporate purposes may include, but are not limited to, the repayment of other debt and selective development, redevelopment, or acquisition of properties. As of September 30, 2022, we had an outstanding balance of $386.7 million under our commercial paper program with a weighted-average interest rate of 3.48%. Extinguishment of secured notes payable In April 2022, we repaid two secured notes payable aggregating $195.0 million due in 2024 with an effective interest rate of 3.40% and recognized a loss on early extinguishment of debt of $3.3 million, including a prepayment penalty and the write-off of unamortized loan fees. 37

string

Income Taxes Receivable

93

SEC-NUM

EOG RESOURCES, INC.CONDENSED CONSOLIDATED BALANCE SHEETS(In Millions, Except Share Data)(Unaudited) | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | September 30,2022 | | December 31,2021 | | ASSETS | | Current Assets | | | | | Cash and Cash Equivalents | $ | 5,272 | | | $ | 5,209 | | | Accounts Receivable, Net | 3,343 | | | 2,335 | | | Inventories | 872 | | | 584 | | | Income Taxes Receivable | 93 | | | — | | | Other | 621 | | | 456 | | | Total | 10,201 | | | 8,584 | | | Property, Plant and Equipment | | | | | Oil and Gas Properties (Successful Efforts Method) | 67,065 | | | 67,644 | | | Other Property, Plant and Equipment | 4,659 | | | 4,753 | | | Total Property, Plant and Equipment | 71,724 | | | 72,397 | | | Less: Accumulated Depreciation, Depletion and Amortization | (42,623) | | | (43,971) | | | Total Property, Plant and Equipment, Net | 29,101 | | | 28,426 | | | Deferred Income Taxes | 18 | | | 11 | | | Other Assets | 1,167 | | | 1,215 | | | Total Assets | $ | 40,487 | | | $ | 38,236 | | | LIABILITIES AND STOCKHOLDERS' EQUITY | | Current Liabilities | | | | | Accounts Payable | $ | 2,718 | | | $ | 2,242 | | | Accrued Taxes Payable | 542 | | | 518 | | | Dividends Payable | 437 | | | 436 | | | Liabilities from Price Risk Management Activities | 243 | | | 269 | | | Current Portion of Long-Term Debt | 1,282 | | | 37 | | | Current Portion of Operating Lease Liabilities | 235 | | | 240 | | | Other | 289 | | | 300 | | | Total | 5,746 | | | 4,042 | | | | | | | | Long-Term Debt | 3,802 | | | 5,072 | | | Other Liabilities | 2,573 | | | 2,193 | | | Deferred Income Taxes | 4,517 | | | 4,749 | | | Commitments and Contingencies (Note 8) | | | | | | | | | | Stockholders' Equity | | | | | Common Stock, $0.01 Par, 1,280,000,000 Shares Authorized and 587,891,710 Shares Issued at September 30, 2022 and 585,521,512 Shares Issued at December 31, 2021 | 206 | | | 206 | | | Additional Paid in Capital | 6,155 | | | 6,087 | | | Accumulated Other Comprehensive Loss | (6) | | | (12) | | | Retained Earnings | 17,563 | | | 15,919 | | | Common Stock Held in Treasury, 646,861 Shares at September 30, 2022 and 257,268 Shares at December 31, 2021 | (69) | | | (20) | | | Total Stockholders' Equity | 23,849 | | | 22,180 | | | Total Liabilities and Stockholders' Equity | $ | 40,487 | | | $ | 38,236 | | The accompanying notes are an integral part of these condensed consolidated financial statements.-4-

string

Due in one year or less, cost or amortized cost, net of allowance

15.3

SEC-NUM

| | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | December 31, 2021 | | | Cost orAmortizedCost, Net of Allowance | | Fair Value | | Due in one year or less | $ | 15.3 | | | $ | 15.1 | | | Due after one year through five years | 443.2 | | | 436.6 | | | Due after five years through ten years | 602.9 | | | 591.3 | | | Due after ten years | 369.8 | | | 360.3 | | | Total | 1,431.2 | | | 1,403.3 | | | Asset-backed | 269.8 | | | 267.5 | | | Commercial mortgage-backed | 280.1 | | | 276.8 | | | Residential mortgage-backed | 105.7 | | | 104.0 | | | Total | $ | 2,086.8 | | | $ | 2,051.6 | | The Company has entered into commercial mortgage loans, collateralized by the underlying real estate, on properties located throughout the U.S. As of December 31, 2021, approximately 38% of the outstanding principal balance of commercial mortgage loans was concentrated in the states of California, Texas and Illinois. Although the Company has a diversified loan portfolio, an economic downturn could have an adverse impact on the ability of its debtors to repay their loans. The outstanding balance of commercial mortgage loans range in size from $0.1 million to $9.6 million as of December 31, 2021 and from $0.1 million to $9.9 million as of December 31, 2020. Credit quality indicators for commercial mortgage loans are loan-to-value and debt-service coverage ratios. The loan-to-value ratio compares the principal amount of the loan to the fair value of the underlying property collateralizing the loan, and is commonly expressed as a percentage. The debt-service coverage ratio compares a property’s net operating income to its debt-service payments and is commonly expressed as a ratio. The loan-to-value and debt-service coverage ratios are generally updated annually in the fourth quarter.The following table presents the amortized cost basis of commercial mortgage loans, excluding allowance for credit losses, by origination year for certain key credit quality indicators at December 31, 2021 and 2020, respectively. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | December 31, 2021 | | | Origination Year | | | 2021 | | 2020 | | 2019 | | 2018 | | 2017 | | Prior | | Total | | % of Total | | Loan to value ratios (1): | | | | | | | | | | | | | | | | | 70% and less | $ | 71.7 | | | $ | 5.6 | | | $ | — | | | $ | — | | | $ | 4.0 | | | $ | 99.8 | | | $ | 181.1 | | | 70.3 | % | | 71% to 80% | 61.8 | | | — | | | — | | | 4.7 | | | — | | | 1.0 | | | 67.5 | | | 26.2 | % | | 81% to 95% | — | | | — | | | — | | | — | | | — | | | 1.1 | | | 1.1 | | | 0.4 | % | | Greater than 95% | — | | | — | | | — | | | — | | | 5.8 | | | 2.1 | | | 7.9 | | | 3.1 | % | | Total | $ | 133.5 | | | $ | 5.6 | | | $ | — | | | $ | 4.7 | | | $ | 9.8 | | | $ | 104.0 | | | $ | 257.6 | | | 100.0 | % | | | | | | | | | | | | | | | | | | | | December 31, 2021 | | | Origination Year | | | 2021 | | 2020 | | 2019 | | 2018 | | 2017 | | Prior | | Total | | % of Total | | Debt service coverage ratios (2): | | | | | | | | | | | | | | | | | Greater than 2.0 | $ | 59.3 | | | $ | 5.6 | | | $ | — | | | $ | — | | | $ | — | | | $ | 70.5 | | | $ | 135.4 | | | 52.6 | % | | 1.5 to 2.0 | 34.1 | | | — | | | — | | | 4.7 | | | 4.0 | | | 17.5 | | | 60.3 | | | 23.4 | % | | 1.0 to 1.5 | 40.1 | | | — | | | — | | | — | | | — | | | 9.9 | | | 50.0 | | | 19.4 | % | | Less than 1.0 | — | | | — | | | — | | | — | | | 5.8 | | | 6.1 | | | 11.9 | | | 4.6 | % | | Total | $ | 133.5 | | | $ | 5.6 | | | $ | — | | | $ | 4.7 | | | $ | 9.8 | | | $ | 104.0 | | | $ | 257.6 | | | 100.0 | % | F-35

string

Finance lease term (in years)

15

SEC-NUM

[Table of Contents](#i89c3c9328e454b30b2c14123b867f3f0_7)EQUINIX, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) 10. LeasesSignificant Lease TransactionsThe following table summarizes the significant lease transactions during the year ended December 31, 2021 (in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Renewal/Termination Options Excluded (1) | | | | Net Incremental (2) | | Lease | | Quarter | | Transaction | | | | | Lease Classification | | ROU assets | | ROU liabilities | | Silicon Valley 8 ("SV8") data center lease extended (3) | | Q1 | | Extended lease term by 16 years | | | | Two 10-year renewal options | | Finance Lease | | $98,141 | | $100,043 | | | | | | | | Operating Lease | | (13,685) | | (15,586) | | Hong Kong 3 ("HK3") data center lease extended (3) | | Q1 | | Extended lease by 10 years, which included a 5-year renewal option | | | | N/A | | Finance Lease - Building | | 37,987 | | 37,987 | | Operating Lease - Land | | 6,592 | | 6,592 | | Osaka 3 ("OS3") new data center and office lease | | Q2 | | New lease-15 year term | | | | 2-year renewal option on a rolling basis | | Finance Lease | | 144,122 | | 144,122 | | | | | | | | --- | --- | --- | | | | | | | (1) These renewal/termination options are not included in determining the lease terms as we are not reasonably certain to exercise them at this time.(2) The net incremental amounts represent the adjustments to the right of use ("ROU") assets and liabilities recorded during the quarter that the transactions were entered.(3) These leases had components previously classified as operating leases.Lease ExpensesThe components of lease expenses are as follows (in thousands): | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | Years Ended December 31, | | | 2021 | | 2020 | | Finance lease cost | | | | | Amortization of right-of-use assets (1) | $ | 157,057 | | | $ | 120,169 | | | Interest on lease liabilities | 117,896 | | | 113,699 | | | Total finance lease cost | 274,953 | | | 233,868 | | | | | | | | Operating lease cost | 221,776 | | | 217,299 | | | Variable lease cost | 33,066 | | | 13,588 | | | Total lease cost | $ | 529,795 | | | $ | 464,755 | | | | | | | --- | --- | --- | | | | | | | (1) Amortization of right-of-use assets is included within depreciation expense, and is recorded within cost of revenues, sales and marketing and general and administrative expenses in the consolidated statements of operations.F-42

string

Non-controlling interests

279

SEC-NUM

IQVIA HOLDINGS INC. AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETS | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | December 31, | | (in millions, except per share data) | | 2021 | | 2020 | | ASSETS | | | | | | Cash and cash equivalents | | $ | 1,366 | | | $ | 1,814 | | | Trade accounts receivable and unbilled services, net | | 2,551 | | | 2,410 | | | Prepaid expenses | | 156 | | | 159 | | | Income taxes receivable | | 58 | | | 56 | | | Investments in debt, equity and other securities | | 111 | | | 88 | | | Other current assets and receivables | | 521 | | | 563 | | | Total current assets | | 4,763 | | | 5,090 | | | Property and equipment, net | | 497 | | | 482 | | | Operating lease right-of-use assets | | 406 | | | 471 | | | Investments in debt, equity and other securities | | 76 | | | 78 | | | Investments in unconsolidated affiliates | | 88 | | | 84 | | | Goodwill | | 13,301 | | | 12,654 | | | Other identifiable intangibles, net | | 4,943 | | | 5,205 | | | Deferred income taxes | | 124 | | | 114 | | | Deposits and other assets | | 491 | | | 386 | | | Total assets | | $ | 24,689 | | | $ | 24,564 | | | LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | | | Current liabilities: | | | | | | Accounts payable and accrued expenses | | $ | 2,981 | | | $ | 2,813 | | | Unearned income | | 1,825 | | | 1,252 | | | Income taxes payable | | 137 | | | 102 | | | Current portion of long-term debt | | 91 | | | 149 | | | Other current liabilities | | 207 | | | 242 | | | Total current liabilities | | 5,241 | | | 4,558 | | | Long-term debt, less current portion | | 12,034 | | | 12,384 | | | Deferred income taxes | | 410 | | | 338 | | | Operating lease liabilities | | 313 | | | 371 | | | Other liabilities | | 649 | | | 633 | | | Total liabilities | | 18,647 | | | 18,284 | | | Commitments and contingencies (Note 1 and 12) | | | | | | Stockholders’ equity: | | | | | | Common stock and additional paid-in capital, 400.0 shares authorized as of December 31, 2021 and 2020, $0.01 par value, 255.8 shares issued and 190.6 shares outstanding as of December 31, 2021; 254.7 shares issued and 191.2 shares outstanding as of December 31, 2020 | | 10,777 | | | 11,095 | | | Retained earnings | | 2,243 | | | 1,277 | | | Treasury stock, at cost, 65.2 and 63.5 shares as of December 31, 2021 and 2020, respectively | | (6,572) | | | (6,166) | | | Accumulated other comprehensive loss | | (406) | | | (205) | | | Equity attributable to IQVIA Holdings Inc.’s stockholders | | 6,042 | | | 6,001 | | | Non-controlling interests | | — | | | 279 | | | Total stockholders’ equity | | 6,042 | | | 6,280 | | | Total liabilities and stockholders’ equity | | $ | 24,689 | | | $ | 24,564 | | The accompanying notes are an integral part of these consolidated financial statements.68

string

Debt Securities, Available-for-sale, Maturity, Allocated and Single Maturity Date, within One Year, Fair Value

68

SEC-NUM

Debt SecuritiesOur debt securities consisted of the following (in millions): | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | Gross Unrealized | EstimatedFair Value | | | Cost | Gains | Losses | | April 1, 2022 | | | | | | Trading securities | $ | 41 | | $ | — | | $ | (1) | | $ | 40 | | | Available-for-sale securities | 1,933 | | 25 | | (165) | | 1,793 | | | Total debt securities | $ | 1,974 | | $ | 25 | | $ | (166) | | $ | 1,833 | | | December 31, 2021 | | | | | | Trading securities | $ | 39 | | $ | 1 | | $ | — | | $ | 40 | | | Available-for-sale securities | 1,648 | | 33 | | (132) | | 1,549 | | | Total debt securities | $ | 1,687 | | $ | 34 | | $ | (132) | | $ | 1,589 | | The carrying values of our debt securities were included in the following line items in our consolidated balance sheets (in millions): | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | April 1, 2022 | | December 31, 2021 | | | Trading Securities | Available-for-Sale Securities | | Trading Securities | Available-for-Sale Securities | | | | | | | | | Marketable securities | $ | 40 | | $ | 1,542 | | | $ | 40 | | $ | 1,283 | | | Other noncurrent assets | — | | 251 | | | — | | 266 | | | Total debt securities | $ | 40 | | $ | 1,793 | | | $ | 40 | | $ | 1,549 | | The contractual maturities of these available-for-sale debt securities as of April 1, 2022 were as follows (in millions): | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | Cost | Estimated Fair Value | | | | | Within 1 year | $ | 70 | | $ | 68 | | | | | | After 1 year through 5 years | 1,649 | | 1,504 | | | | | | After 5 years through 10 years | 43 | | 57 | | | | | | After 10 years | 171 | | 164 | | | | | | Total | $ | 1,933 | | $ | 1,793 | | | | | The Company expects that actual maturities may differ from the contractual maturities above because borrowers have the right to call or prepay certain obligations.The sale and/or maturity of available-for-sale debt securities resulted in the following realized activity (in millions): | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | Three Months Ended | | | | | | April 1,2022 | April 2,2021 | | Gross gains | | | | $ | 1 | | $ | 1 | | | Gross losses | | | | (5) | | (4) | | | Proceeds | | | | 231 | | 158 | | Captive Insurance CompaniesIn accordance with local insurance regulations, our consolidated captive insurance companies are required to meet and maintain minimum solvency capital requirements. The Company elected to invest a majority of its solvency capital in a portfolio of marketable equity and debt securities. These securities are included in the disclosures above. The Company uses one of our consolidated captive insurance companies to reinsure group annuity insurance contracts that cover the obligations of certain of our European and Canadian pension plans. This captive’s solvency capital funds included total equity and debt securities of $1,580 million and $1,670 million as of April 1, 2022 and December 31, 2021, respectively, which are classified in the line item other noncurrent assets in our consolidated balance sheets because the assets are not available to satisfy our current obligations.9

string

Common stock, par value (usd per share)

0.001

SEC-NUM

DAVITA INC.CONSOLIDATED BALANCE SHEETS(unaudited)(dollars and shares in thousands, except per share data) | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | June 30, 2022 | | December 31, 2021 | | ASSETS | | | | | Cash and cash equivalents | $ | 262,605 | | | $ | 461,900 | | | Restricted cash and equivalents | 93,132 | | | 93,060 | | | Short-term investments | 100,489 | | | 22,310 | | | Accounts receivable | 2,093,830 | | | 1,957,583 | | | Inventories | 109,522 | | | 107,428 | | | Other receivables | 502,921 | | | 427,321 | | | Prepaid and other current assets | 63,539 | | | 72,517 | | | Income tax receivable | 38,070 | | | 25,604 | | | Total current assets | 3,264,108 | | | 3,167,723 | | | Property and equipment, net of accumulated depreciation of $4,989,142 and $4,763,135, respectively | 3,304,596 | | | 3,479,972 | | | Operating lease right-of-use assets | 2,771,757 | | | 2,824,787 | | | Intangible assets, net of accumulated amortization of $44,985 and $60,730, respectively | 184,740 | | | 177,693 | | | Equity method and other investments | 253,457 | | | 238,881 | | | Long-term investments | 44,562 | | | 49,514 | | | Other long-term assets | 257,577 | | | 136,677 | | | Goodwill | 7,019,778 | | | 7,046,241 | | | | $ | 17,100,575 | | | $ | 17,121,488 | | | LIABILITIES AND EQUITY | | | | | Accounts payable | $ | 402,308 | | | $ | 402,049 | | | Other liabilities | 752,717 | | | 709,345 | | | Accrued compensation and benefits | 559,791 | | | 659,960 | | | Current portion of operating lease liabilities | 398,421 | | | 394,357 | | | Current portion of long-term debt | 197,510 | | | 179,030 | | | Income tax payable | — | | | 53,792 | | | Total current liabilities | 2,310,747 | | | 2,398,533 | | | Long-term operating lease liabilities | 2,606,391 | | | 2,672,713 | | | Long-term debt | 9,064,916 | | | 8,729,150 | | | Other long-term liabilities | 105,137 | | | 119,158 | | | Deferred income taxes | 852,389 | | | 830,954 | | | Total liabilities | 14,939,580 | | | 14,750,508 | | | Commitments and contingencies | | | | | Noncontrolling interests subject to put provisions | 1,385,821 | | | 1,434,832 | | | Equity: | | | | | Preferred stock ($0.001 par value, 5,000 shares authorized; none issued) | — | | | — | | | Common stock ($0.001 par value, 450,000 shares authorized; 98,179 and 92,206 shares issued and outstanding at June 30, 2022, respectively, and 97,289 shares issued and outstanding at December 31, 2021) | 98 | | | 97 | | | Additional paid-in capital | 578,272 | | | 540,321 | | | Retained earnings | 741,268 | | | 354,337 | | | Treasury stock (5,973 and zero shares, respectively) | (603,058) | | | — | | | Accumulated other comprehensive loss | (111,796) | | | (139,247) | | | Total DaVita Inc. shareholders' equity | 604,784 | | | 755,508 | | | Noncontrolling interests not subject to put provisions | 170,390 | | | 180,640 | | | Total equity | 775,174 | | | 936,148 | | | | $ | 17,100,575 | | | $ | 17,121,488 | | See notes to condensed consolidated financial statements.3

string

Total Finance and Operating Lease 2025

8

SEC-NUM

NOTE 8 – Long-Term Debt and Lease ObligationsThis table summarizes the principal amounts of our long-term debt excluding unamortized discounts, none of which are encumbered by rating triggers: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (Dollars in millions) | | | | Book value | | Principal amount | | Interest rate | | Year of issue | | | | At December 31, | | At December 31, | | | | | | 2021 | | 2020 | | 2021 | | 2020 | | 6.900% | | 1998 | | Senior debentures, due 2028 | | $ | 27 | | | $ | 27 | | | $ | 28 | | | $ | 28 | | | 6.920% | | 2005 | | Senior debentures, due 2028 | | 391 | | | 391 | | | 391 | | | 391 | | | 6.125% | | 2004 | | Senior notes, due 2034 | | 371 | | | 370 | | | 374 | | | 374 | | | | | | | Total | | $ | 789 | | | $ | 788 | | | $ | 793 | | | $ | 793 | | | | | | | | | | | | | | | | The finance lease term for equipment and autos is three to six years while the operating lease term for real estate properties is typically five years. Lease obligations totaled $54 million and $57 million in 2021 and 2020, respectively. Below are the lease obligations we expect to pay through years 2027 and thereafter including $3 million of interest for finance and operating leases: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (Dollars in millions) | Years ended December 31, | | | | | 2022 | | 2023 | | 2024 | | 2025 | | 2026 | | 2027 and thereafter | | Finance lease obligations | $ | 14 | | | $ | 12 | | | $ | 8 | | | $ | 6 | | | $ | 3 | | | $ | 2 | | | Operating lease obligations | 4 | | | 2 | | | 2 | | | 2 | | | 1 | | | 1 | | | Total lease obligations | $ | 18 | | | $ | 14 | | | $ | 10 | | | $ | 8 | | | $ | 4 | | | $ | 3 | | | | | | | | | | | | | | | The following table provides lease cost and other information: | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | (Dollars in millions) | | Years ended December 31, | | | | 2021 | | 2020 | | 2019 | | Lease cost: | | | | | | | | Finance lease cost | | $ | 15 | | | $ | 15 | | | $ | 9 | | | Operating lease cost | | 4 | | | 4 | | | 4 | | | Total lease cost | | $ | 19 | | | $ | 19 | | | $ | 13 | | | | | | | | | | | Other information finance leases: | | | | | | | | Finance cash outflows | | $ | 15 | | | $ | 15 | | | $ | 15 | | | Weighted average discount rate | | 2.46 | % | | 2.62 | % | | 2.96 | % | | Weighted average remaining lease term in years | | 3.45 | | 3.67 | | 3.65 | | | | | | | | | | Other information operating leases: | | | | | | | | Operating cash outflows | | $ | 4 | | | $ | 8 | | | $ | 8 | | | Weighted average discount rate | | 2.86 | % | | 3.65 | % | | 3.69 | % | | Weighted average remaining lease term in years | | 4.37 | | 4.84 | | 4.71 | | | | | | | | | Cincinnati Financial Corporation - 2021 10-K - Page 154

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Preferred stock, shares authorized (in shares)

5,000,000

SEC-NUM

FMC CORPORATIONCONDENSED CONSOLIDATED BALANCE SHEETS | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | (in Millions, Except Share and Par Value Data) | September 30, 2022 | | December 31, 2021 | | ASSETS | (unaudited) | | Current assets | | | | | Cash and cash equivalents | $ | 363.8 | | | $ | 516.8 | | | Trade receivables, net of allowance of $34.5 in 2022 and $37.4 in 2021 | 2,599.9 | | | 2,583.7 | | | Inventories | 1,731.5 | | | 1,521.9 | | | Prepaid and other current assets | 415.4 | | | 431.4 | | | | | | | | | | | | | Total current assets | $ | 5,110.6 | | | $ | 5,053.8 | | | Investments | 10.3 | | | 9.2 | | | Property, plant and equipment, net | 789.6 | | | 817.0 | | | Goodwill | 1,574.1 | | | 1,463.3 | | | Other intangibles, net | 2,472.7 | | | 2,521.9 | | | Other assets including long-term receivables, net | 623.3 | | | 613.8 | | | Deferred income taxes | 184.1 | | | 194.1 | | | | | | | | Total assets | $ | 10,764.7 | | | $ | 10,673.1 | | | LIABILITIES AND EQUITY | | | | | Current liabilities | | | | | Short-term debt and current portion of long-term debt | $ | 826.3 | | | $ | 440.8 | | | Accounts payable, trade and other | 1,045.7 | | | 1,135.0 | | | Advance payments from customers | 3.3 | | | 630.7 | | | Accrued and other liabilities | 611.4 | | | 631.2 | | | | | | | | Accrued customer rebates | 857.7 | | | 406.7 | | | Guarantees of vendor financing | 184.2 | | | 206.2 | | | Accrued pension and other postretirement benefits, current | 4.3 | | | 4.3 | | | Income taxes | 99.3 | | | 65.4 | | | | | | | | Total current liabilities | $ | 3,632.2 | | | $ | 3,520.3 | | | Long-term debt, less current portion | 2,732.5 | | | 2,731.7 | | | Accrued pension and other postretirement benefits, long-term | 38.8 | | | 41.8 | | | Environmental liabilities, continuing and discontinued | 356.5 | | | 415.9 | | | Deferred income taxes | 351.7 | | | 342.4 | | | Other long-term liabilities | 449.4 | | | 477.3 | | | | | | | | Commitments and contingent liabilities (Note 19) | | | | | Equity | | | | | Preferred stock, no par value, authorized 5,000,000 shares; no shares issued in 2022 or 2021 | $ | — | | | $ | — | | | Common stock, $0.10 par value, authorized 260,000,000 shares; 185,983,792 issued shares in 2022 and 2021 | 18.6 | | | 18.6 | | | Capital in excess of par value of common stock | 903.3 | | | 880.4 | | | Retained earnings | 5,354.8 | | | 5,092.9 | | | Accumulated other comprehensive income (loss) | (542.0) | | | (325.5) | | | Treasury stock, common, at cost - 2022: 60,017,869 shares, 2021: 60,284,313 shares | (2,546.5) | | | (2,542.1) | | | Total FMC stockholders’ equity | $ | 3,188.2 | | | $ | 3,124.3 | | | Noncontrolling interests | 15.4 | | | 19.4 | | | Total equity | $ | 3,203.6 | | | $ | 3,143.7 | | | Total liabilities and equity | $ | 10,764.7 | | | $ | 10,673.1 | | The accompanying notes are an integral part of these condensed consolidated financial statements.5

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Future amortization expense, year five

1.4

SEC-NUM

Finite-lived intangible assets are amortized over their legal or estimated useful life. The following summarizes the gross carrying value and accumulated amortization for each major category of intangible assets as of December 31 ($ in millions): | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | 2021 | | 2020 | | | GrossCarryingAmount | | AccumulatedAmortization | | GrossCarryingAmount | | AccumulatedAmortization | | Finite-lived intangibles: | | | | | | | | | Patents and technology | $ | 14,377 | | | $ | (2,281) | | | $ | 12,526 | | | $ | (1,539) | | | Customer relationships, trade names and other intangibles | 9,547 | | | (3,748) | | | 9,355 | | | (3,235) | | | Total finite-lived intangibles | 23,924 | | | (6,029) | | | 21,881 | | | (4,774) | | | Indefinite-lived intangibles: | | | | | | | | | Trademarks and trade names | 4,948 | | | — | | | 4,175 | | | — | | | Total intangibles | $ | 28,872 | | | $ | (6,029) | | | $ | 26,056 | | | $ | (4,774) | | During 2021, the Company acquired finite-lived intangible assets, consisting primarily of developed technology, customer relationships and trade names, with a weighted average life of 13 years primarily as a result of the Aldevron Acquisition. During 2020, the Company acquired finite-lived intangible assets, consisting primarily of developed technology, customer relationships and trade names, with a weighted average life of 17 years primarily as a result of the Cytiva Acquisition. Refer to Note 2 for additional information on the intangible assets acquired.The Company reviews identified intangible assets for impairment whenever events or changes in circumstances indicate that the related carrying amounts may not be recoverable. Indefinite-lived intangibles are subject to impairment testing at least annually or more frequently if events or changes in circumstances indicate that potential impairment exists. The Company identified impairment triggers during the first quarter of 2021 in the Diagnostics segment and the first and third quarters of 2020 in the Diagnostics and Environmental & Applied Solutions segments which resulted in the impairment of certain long-lived assets, including trade names and other intangible assets. In 2021 and 2020, the Company recorded impairment charges totaling $10 million and $22 million, respectively, related to these long-lived assets in selling, general and administrative expenses in the Consolidated Statements of Earnings. Total intangible amortization expense in 2021, 2020 and 2019 was $1,450 million, $1,138 million and $625 million, respectively. The increase in intangible amortization expense in 2021 and 2020 was primarily as a result of the Aldevron and Cytiva acquisitions and the amortization of the associated finite-lived intangible assets. Based on the intangible assets recorded as of December 31, 2021, amortization expense is estimated to be approximately $1.5 billion during 2022, $1.5 billion during 2023, $1.5 billion during 2024, $1.5 billion during 2025 and $1.4 billion during 2026. NOTE 12. FAIR VALUE MEASUREMENTS Accounting standards define fair value based on an exit price model, establish a framework for measuring fair value where the Company’s assets and liabilities are required to be carried at fair value and provide for certain disclosures related to the valuation methods used within a valuation hierarchy as established within the accounting standards. This hierarchy prioritizes the inputs into three broad levels as follows. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets in markets that are not active, or other observable characteristics for the asset or liability, including interest rates, yield curves and credit risks, or inputs that are derived principally from, or corroborated by, observable market data through correlation. Level 3 inputs are unobservable inputs based on the Company’s assumptions. A financial asset or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement in its entirety.90

string

Present value of minimum lease payments

314

SEC-NUM

The components of lease revenue for the years ended December 31, 2021, 2020 and 2019 were: | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | (in millions) | 2021 | | 2020 | | 2019 | | Sales-type lease revenue | $ | 27 | | | $ | 38 | | | $ | 35 | | | Operating lease revenue | 136 | | | 84 | | | 61 | | | Variable lease revenue | 79 | | | 80 | | | 85 | | | Total lease revenue | $ | 242 | | | $ | 202 | | | $ | 181 | | The components of our net investment in sales-type leases as of December 31, 2021 and 2020 were: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | (in millions) | 2021 | | 2020 | | Minimum lease payments | $ | 111 | | | $ | 122 | | | Unguaranteed residual values | 4 | | | 12 | | | Net investment in leases | $ | 115 | | | $ | 134 | | Our net investment in sales-type leases is classified as follows in the accompanying consolidated balance sheets: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | (in millions) | December 31, 2021 | | December 31, 2020 | | Accounts receivable, net | $ | 40 | | | $ | 39 | | | Other non-current assets | 75 | | | 95 | | | Total | $ | 115 | | | $ | 134 | | Our net investment in sales-type leases was $115 million as of December 31, 2021, of which $13 million originated in 2017 and prior, $24 million in 2018, $24 million in 2019, $32 million in 2020 and $22 million in 2021.Maturities of sales-type and operating leases as of December 31, 2021 were: | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | (in millions) | Sales-type Leases | Operating Leases | | 2022 | $ | 43 | | $ | 87 | | | 2023 | 32 | | 79 | | | 2024 | 22 | | 75 | | | 2025 | 12 | | 60 | | | 2026 | 5 | | 11 | | | Thereafter | 1 | | 2 | | | Total minimum lease payments | 115 | | $ | 314 | | | Less: imputed interest | (4) | | | | Present value of minimum lease payments | $ | 111 | | | NOTE 7 | | | | | --- | --- | --- | | | | | | COMMITMENTS AND CONTINGENCIES | Refer to Note 2 for information regarding our unfunded contingent payments associated with collaborative and other arrangements.IndemnificationsDuring the normal course of business, we make indemnities, commitments and guarantees pursuant to which we may be required to make payments related to specific transactions. Indemnifications include: (i) intellectual property indemnities to customers in connection with the use, sales or license of products and services; (ii) indemnities to customers in connection with losses incurred while performing services on their premises; (iii) indemnities to vendors and service providers pertaining to claims based on negligence or willful misconduct; (iv) indemnities involving the representations and warranties in certain contracts; and (v) contractual indemnities for our directors and certain of our executive officers for services provided to or at the request of us. In addition, under our Amended and Restated Certificate of Incorporation, and consistent with Delaware General Corporation Law, we have agreed 74

string

Expected term

10

SEC-NUM

[Table of Contents](#i16ebb68f4bd84ff99a771b20ec27c3fc_7)Contributions to and reimbursements by us of expenses of the plan were recorded in the accompanying consolidated income statements as follows: | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | Year Ended | | | | January 29, | | January 30, | | February 1, | | (in millions) | | 2022 | | 2021 | | 2020 | | Cost of sales | | $ | 8.2 | | | $ | 7.4 | | | $ | 8.1 | | | Selling, general and administrative expenses | | 20.6 | | | 19.0 | | | 17.0 | | | Total | | $ | 28.8 | | | $ | 26.4 | | | $ | 25.1 | | All eligible employees are immediately vested in any company match contributions under the 401(k) plan.Note 10 - Stock-Based Compensation PlansFixed Stock-Based Compensation PlansThe 2011 Omnibus Incentive Plan permitted us to grant to our employees, consultants and directors up to 4.0 million shares of our Common Stock plus any shares available under former plans which were previously approved by the shareholders. The plan permitted us to grant equity awards in the form of incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock awards, restricted stock units (“RSUs”), performance bonuses, performance share units (“PSUs”), non-employee director stock options and other equity-related awards. As of March 17, 2021, the plan was no longer available for new grants of awards, but all outstanding awards that were granted under the plan prior to March 17, 2021 continue to be governed by the terms and conditions of the plan and applicable award agreements. Effective June 10, 2021, the 2011 Omnibus Incentive Plan was replaced and superseded by the 2021 Omnibus Incentive Plan (“Omnibus Plan”). The Omnibus Plan permits us to grant up to 6.5 million shares of our Common Stock to our employees, consultants and directors. The form of equity awards authorized for grant under the Omnibus Plan are substantially the same as those permitted by the predecessor plan. Stock appreciation rights may be awarded alone or in tandem with stock options. When the stock appreciation rights are exercisable, the holder may surrender all or a portion of the unexercised stock appreciation right and receive in exchange an amount equal to the excess of the fair market value at the date of exercise over the fair market value at the date of the grant. No stock appreciation rights have been granted to date.Any restricted stock, RSUs or PSUs awarded are subject to certain general restrictions. The restricted stock shares or units may not be sold, transferred, pledged or disposed of until the restrictions on the shares or units have lapsed or have been removed under the provisions of the plan. In addition, if a holder of restricted shares or units ceases to be employed by us, any shares or units in which the restrictions have not lapsed will be forfeited.The 2013 Director Deferred Compensation Plan permits any of our directors who receive a retainer or other fees for Board or Board committee service to defer all or a portion of such fees until a future date, at which time they may be paid in cash or shares of our common stock, or receive all or a portion of such fees in non-statutory stock options. Deferred fees that are paid out in cash will earn interest at the 30-year Treasury Bond Rate. If a director elects to be paid in common stock, the number of shares will be determined by dividing the deferred fee amount by the closing market price of a share of our common stock on the date of deferral. The number of options issued to a director will equal the deferred fee amount divided by 33% of the price of a share of our common stock. The exercise price will equal the fair market value of our common stock at the date the option is issued. The options are fully vested when issued and have a term of 10 years.In conjunction with the acquisition of Family Dollar in 2015, we assumed the Family Dollar Stores, Inc. 2006 Incentive Plan (the “2006 Plan”). The 2006 Plan permitted the granting of a variety of compensatory award types, including stock options and performance share rights. 62

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Estimated impact of the CCR and ELG rules

562

SEC-NUM

[Table of Contents](#ie1b09d57e49a40aaa81f572e6311eac9_10)DTE Energy Company — DTE Electric CompanyCombined Notes to Consolidated Financial Statements (Unaudited) — (Continued)Compliance schedules for individual facilities and individual waste streams are determined through issuance of new NPDES permits by the State of Michigan. The State of Michigan has issued an NPDES permit for the Belle River power plant establishing compliance deadlines based on the 2020 Reconsideration Rule. On October 11, 2021, in consideration of the deadlines above, DTE Electric submitted the appropriate documentation titled the Notice of Planned Participation (NOPP) to the State of Michigan that formally announced the intent to pursue compliance subcategories as ELG compliance options: the cessation of coal at the Belle River power plant no later than December 31, 2028 and the VIP for FGD wastewater at Monroe power plant by December 31, 2028.On July 27, 2021, the EPA announced they will revisit some of the compliance requirements that were established in the 2020 Reconsideration Rule and plan to release a new proposed rule in Fall of 2022. The 2020 Reconsideration Rule remains in effect until that time.DTE Electric continues to evaluate compliance strategies, technologies and system designs for both FGD wastewater and bottom ash transport water system to achieve compliance with the EPA rules at the Monroe power plant.DTE Electric has estimated the impact of the CCR and ELG rules to be $562 million of capital expenditures, including $457 million for 2022 through 2026.DTE GasContaminated and Other Sites — DTE Gas owns or previously owned 14 former MGP sites. Investigations have revealed contamination related to the by-products of gas manufacturing at each site. Cleanup of eight of the MGP sites is complete, and the sites are closed. DTE Gas has also completed partial closure of four additional sites. Cleanup activities associated with the remaining sites will continue over the next several years. The MPSC has established a cost deferral and rate recovery mechanism for investigation and remediation costs incurred at former MGP sites. In addition to the MGP sites, DTE Gas is also in the process of cleaning up other contaminated sites, including gate stations, gas pipeline releases, and underground storage tank locations. As of March 31, 2022 and December 31, 2021, DTE Gas had $24 million accrued for remediation. These costs are not discounted to their present value. Any change in assumptions, such as remediation techniques, nature and extent of contamination, and regulatory requirements, could impact the estimate of remedial action costs for the sites and affect DTE Gas' financial position and cash flows. DTE Gas anticipates the cost amortization methodology approved by the MPSC, which allows for amortization of the MGP costs over a ten-year period beginning with the year subsequent to the year the MGP costs were incurred, will prevent the associated investigation and remediation costs from having a material adverse impact on DTE Gas' results of operations.Non-utilityDTE Energy's non-utility businesses are subject to a number of environmental laws and regulations dealing with the protection of the environment from various pollutants.In March 2019, the EPA issued an FOV to EES Coke Battery, LLC ("EES Coke"), the Michigan coke battery facility that is a wholly-owned subsidiary of DTE Energy, alleging that the 2008 and 2014 permits issued by EGLE did not comply with the Clean Air Act. In September 2020, the EPA issued another FOV alleging EES Coke's 2018 and 2019 SO2 emissions exceeded projections and hence violated non-attainment new source review requirements. EES Coke evaluated the EPA's alleged violations and believes that the permits approved by EGLE complied with the Clean Air Act. EES Coke also responded to the EPA's September 2020 allegations demonstrating its actual emissions are compliant with non-attainment new source review requirements. Discussions with the EPA are ongoing. At the present time, DTE Energy cannot predict the outcome or financial impact of this FOV.Additionally, in December 2021, EGLE issued a Notice of Violation to EES Coke alleging excess visible emissions from pushing operations. In January 2022, EES Coke provided EGLE a response describing the corrective actions taken to prevent future recurrences. At the present time, EES Coke cannot predict the outcome or financial impact of this matter.OtherIn 2010, the EPA finalized a new one-hour SO2 ambient air quality standard that requires states to submit plans and associated timelines for non-attainment areas that demonstrate attainment with the new SO2 standard in phases. Phase 1 addresses non-attainment areas designated based on ambient monitoring data. Phase 2 addresses non-attainment areas with large sources of SO2 and modeled concentrations exceeding the National Ambient Air Quality Standards for SO2. Phase 3 addresses smaller sources of SO2 with modeled or monitored exceedances of the new SO2 standard.47

string

Adjustment for MCPS dividends for dilutive MCPS

78

SEC-NUM

[Table of Contents](#ia72a687f7b8a4bb1b43219ab5b663314_7)Information related to the calculation of net earnings per common share from continuing operations for the years ended December 31 is summarized as follows ($ and shares in millions, except per share amounts): | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | 2021 | | 2020 | | 2019 | | Numerator: | | | | | | | Net earnings from continuing operations | $ | 6,347 | | | $ | 3,646 | | | $ | 2,432 | | | MCPS dividends | (164) | | | (136) | | | (68) | | | Net earnings from continuing operations attributable to common stockholders for Basic EPS | 6,183 | | | 3,510 | | | 2,364 | | | Adjustment for interest on convertible debentures | — | | | 1 | | | 2 | | | Adjustment for MCPS dividends for dilutive MCPS | 78 | | | — | | | — | | | Net earnings from continuing operations attributable to common stockholders after assumed conversions for Diluted EPS | $ | 6,261 | | | $ | 3,511 | | | $ | 2,366 | | | | | | | | | | Denominator: | | | | | | | Weighted average common shares outstanding used in Basic EPS | 714.6 | | | 706.2 | | | 715.0 | | | Incremental common shares from: | | | | | | | Assumed exercise of dilutive options and vesting of dilutive RSUs and PSUs | 11.2 | | | 11.4 | | | 8.9 | | | Assumed conversion of the convertible debentures | — | | | 1.1 | | | 1.6 | | | Weighted average MCPS converted shares | 11.0 | | | — | | | — | | | Weighted average common shares outstanding used in Diluted EPS | 736.8 | | | 718.7 | | | 725.5 | | | | | | | | | | Basic EPS from continuing operations | $ | 8.65 | | | $ | 4.97 | | | $ | 3.31 | | | Diluted EPS from continuing operations | $ | 8.50 | | | $ | 4.89 | | | $ | 3.26 | | 78

string

Expected future benefit payments, 2025

29

SEC-NUM

Excluding cash, during 2021 we held approximately 87% of our pension portfolio in domestic common equity investments. The remainder of the portfolio consisted of 8% in United States government fixed-maturity investments, 3% in domestic corporate fixed-maturity investments and 2% in states, municipalities and taxable political subdivisions fixed-maturity investments. Our common equity portfolio consisted of 32% in the information technology sector, 20% in the financial sector, 13% in the healthcare sector, and 12% in the industrial sector, at year-end 2021. No additional sectors accounted for 10% or more of our common equity portfolio balance at year-end 2021. Investments in securities are valued based on the fair value hierarchy outlined in Note 3, Fair Value Measurements. The pension plan did not have any liabilities carried at fair value during the years ended December 31, 2021 and 2020. The following table shows the fair value hierarchy for those assets measured at fair value on a recurring basis at December 31, 2021 and 2020. Excluded from the table below is cash on hand of $16 million and $31 million at December 31, 2021 and 2020, respectively. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (Dollars in millions) | | Quoted prices inactive markets foridentical assets (Level 1) | | Significant otherobservable inputs (Level 2) | | Significantunobservableinputs (Level 3) | | Total | | At December 31, 2021 | | | | | | Fixed maturities, available for sale: | | | | | | | | | | United States government | | $ | 31 | | | $ | — | | | $ | — | | | $ | 31 | | | Corporate | | — | | | 11 | | | — | | | 11 | | | States, municipalities and political subdivisions | | — | | | 7 | | | — | | | 7 | | | Total fixed maturities, available for sale | | 31 | | | 18 | | | — | | | 49 | | | Common equities | | 332 | | | — | | | — | | | 332 | | | Total | | $ | 363 | | | $ | 18 | | | $ | — | | | $ | 381 | | | | | | | | | | | | | At December 31, 2020 | | | | | | | | | | Fixed maturities, available for sale: | | | | | | | | | | United States government | | $ | 31 | | | $ | — | | | $ | — | | | $ | 31 | | | Corporate | | — | | | 20 | | | — | | | 20 | | | States, municipalities and political subdivisions | | — | | | 9 | | | — | | | 9 | | | Total fixed maturities, available for sale | | 31 | | | 29 | | | — | | | 60 | | | Common equities | | 266 | | | — | | | — | | | 266 | | | Total | | $ | 297 | | | $ | 29 | | | $ | — | | | $ | 326 | | | | | | | | | | | | Our pension plan assets included 202,337 shares of the company’s common stock at both December 31, 2021 and 2020, which had a fair value of $23 million and $18 million at December 31, 2021 and 2020, respectively. The defined benefit pension plan did not purchase any of our common stock during 2021 or 2020. The defined benefit pension plan did not sell any shares during 2021 and sold 29,776 shares of our common stock during 2020. The company paid less than $1 million in both 2021 and 2020 in cash dividends on our common stock to the pension plan. We estimate $6 million of benefit payments from the SERP during 2022. We expect to make the following benefit payments for our qualified plan and SERP, reflecting expected future service: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (Dollars in millions) | | Years ended December 31, | | | | 2022 | | 2023 | | 2024 | | 2025 | | 2026 | | 2027 - 2031 | | Expected future benefit payments | | $ | 29 | | | $ | 25 | | | $ | 27 | | | $ | 29 | | | $ | 34 | | | $ | 162 | | | | | | | | | | | | | | | | Cincinnati Financial Corporation - 2021 10-K - Page 165

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Debt instrument, term (in months)

45

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[Table of Contents](#ifa3dff468a15495db7b57c65ada0de74_7)During the three months ended March 31, 2022, in conjunction with the Company’s acquisitions of real estate, the Company acquired intangible assets of $4 million and intangible liabilities of $5 million. The intangible assets and liabilities acquired had a weighted average amortization period at acquisition of 9 years and 12 years, respectively.During the year ended December 31, 2021, in conjunction with the Company’s acquisitions of real estate, the Company acquired intangible assets of $109 million and intangible liabilities of $57 million. The intangible assets and intangible liabilities acquired had a weighted average amortization period at acquisition of 9 years.NOTE 9. Debt | | | | | --- | --- | --- | | | | | | | Bank Line of Credit and Term Loan On May 23, 2019, the Company executed a $2.5 billion unsecured revolving line of credit facility, with a maturity date of May 23, 2023 and two six-month extension options, subject to certain customary conditions. Also in May 2019, the Company entered into a $250 million unsecured term loan facility, with a maturity date of May 23, 2024 (the “2019 Term Loan”). In July 2021, the Company repaid the $250 million 2019 Term Loan. In September 2021, the Company executed an amended and restated unsecured revolving line of credit (the “Revolving Facility”) to increase total revolving commitments from $2.5 billion to $3.0 billion and extend the maturity date to January 20, 2026. This maturity date may be further extended pursuant to two six-month extension options, subject to certain customary conditions. Borrowings under the Revolving Facility accrue interest at LIBOR plus a margin that depends on the credit ratings of the Company’s senior unsecured long-term debt. The Company also pays a facility fee on the entire revolving commitment that depends on its credit ratings. Based on the Company’s credit ratings at March 31, 2022, the margin on the Revolving Facility was 0.78% and the facility fee was 0.15%. At March 31, 2022 and December 31, 2021, the Company had no balance outstanding under the Revolving Facility.The Revolving Facility includes a feature that allows the Company to increase the borrowing capacity by an aggregate amount of up to $750 million, subject to securing additional commitments. Further, the Revolving Facility includes customary LIBOR replacement language, including, but not limited to, the use of rates based on the secured overnight financing rate administered by the Federal Reserve Bank of New York. The Revolving Facility also includes a sustainability-linked pricing component whereby the applicable margin may be reduced by up to 0.025% based on the Company’s achievement of specified sustainability-linked metrics, subject to certain conditions. The Revolving Facility also contains certain financial restrictions and other customary requirements, including financial covenants and cross-default provisions to other indebtedness. Among other things, these covenants, using terms defined in the agreement: (i) limit the ratio of Enterprise Total Indebtedness to Enterprise Gross Asset Value to 60%; (ii) limit the ratio of Enterprise Secured Debt to Enterprise Gross Asset Value to 40%; (iii) limit the ratio of Enterprise Unsecured Debt to Enterprise Unencumbered Asset Value to 60%; (iv) require a minimum Fixed Charge Coverage ratio of 1.5 times; and (v) require a minimum Consolidated Tangible Net Worth of $7.7 billion. The Company believes it was in compliance with each of these covenants at March 31, 2022.Commercial Paper ProgramIn September 2019, the Company established an unsecured commercial paper program (the “Commercial Paper Program”). Under the terms of the Commercial Paper Program, the Company may issue, from time to time, unsecured short-term debt securities with varying maturities. Amounts available under the Commercial Paper Program may be borrowed, repaid, and re-borrowed from time to time. During 2021, the Company increased the maximum aggregate face or principal amount that can be outstanding at any one time from $1.0 billion to $1.5 billion. Amounts borrowed under the Commercial Paper Program will be sold on terms that are customary for the U.S. commercial paper market and will be at least equal in right of payment with all of the Company’s other unsecured and unsubordinated indebtedness. The Company uses its Revolving Facility as a liquidity backstop for the repayment of unsecured short-term debt securities issued under the Commercial Paper Program. At March 31, 2022, the Company had $1.33 billion of securities outstanding under the Commercial Paper Program, with original maturities of approximately 45 days and a weighted average interest rate of 0.93%. At December 31, 2021, the Company had $1.17 billion of securities outstanding under the Commercial Paper Program, with original maturities of approximately two months and a weighted average interest rate of 0.32%.Senior Unsecured NotesAt each of March 31, 2022 and December 31, 2021, the Company had senior unsecured notes outstanding with an aggregate principal balance of $4.7 billion. The senior unsecured notes contain certain covenants including limitations on debt, maintenance of unencumbered assets, cross-acceleration provisions and other customary terms. The Company believes it was in compliance with these covenants at March 31, 2022.18

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Sales and settlements

1

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The following table shows how the fair value of the Level 3 assets changed during each of the last two years. There were no transfers of assets between Level 3 and either of the other two levels. | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | Level 3 | | Balance as of April 30, 2020 | | | | | | | $ | 2 | | | Return on assets held at end of year | | | | | | | 1 | | | | | | | | | | | | | | | | | | | | | Sales and settlements | | | | | | | (1) | | | Balance as of April 30, 2021 | | | | | | | 2 | | | Return on assets held at end of year | | | | | | | — | | | | | | | | | | | | | | | | | | | | | Sales and settlements | | | | | | | — | | | Balance as of April 30, 2022 | | | | | | | $ | 2 | | The following table shows how the total fair value of all pension plan assets changed during each of the last two years. (We do not have assets set aside for postretirement medical or life insurance benefits.) | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | Pension Benefits | | Medical and LifeInsurance Benefits | | | 2021 | | 2022 | | 2021 | | 2022 | | Assets at beginning of year | $ | 749 | | | $ | 836 | | | $ | — | | | $ | — | | | Actual return on assets | 124 | | | (25) | | | — | | | — | | | Retiree contributions | — | | | — | | | 1 | | | 1 | | | Company contributions | 16 | | | 12 | | | 3 | | | 3 | | | Benefits paid | (53) | | | (82) | | | (4) | | | (4) | | | Assets at end of year | $ | 836 | | | $ | 741 | | | $ | — | | | $ | — | | We currently expect to contribute $13 to our pension plans and $3 to our postretirement medical and life insurance benefit plans during 2023.Funded status. The funded status of a plan refers to the difference between its assets and its obligations. The following table shows the funded status of our plans. | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | Pension Benefits | | Medical and LifeInsurance Benefits | | April 30, | 2021 | | 2022 | | 2021 | | 2022 | | Assets | $ | 836 | | | $ | 741 | | | $ | — | | | $ | — | | | Obligations | (1,012) | | | (846) | | | (49) | | | (43) | | | Funded status | $ | (176) | | | $ | (105) | | | $ | (49) | | | $ | (43) | | The funded status is recorded on the accompanying consolidated balance sheets as follows: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Pension Benefits | | Medical and LifeInsurance Benefits | | April 30, | | 2021 | | 2022 | | 2021 | | 2022 | | Other assets | | $ | 4 | | | $ | 46 | | | $ | — | | | $ | — | | | Accounts payable and accrued expenses | | (7) | | | (8) | | | (3) | | | (3) | | | Accrued pension and other postretirement benefits | | (173) | | | (143) | | | (46) | | | (40) | | | Net liability | | $ | (176) | | | $ | (105) | | | $ | (49) | | | $ | (43) | | | Accumulated other comprehensive income (loss), before tax: | | | | | | | | | | Net actuarial gain (loss) | | $ | (298) | | | $ | (201) | | | $ | (9) | | | $ | (3) | | | Prior service credit (cost) | | (5) | | | (4) | | | 4 | | | 2 | | | | | $ | (303) | | | $ | (205) | | | $ | (5) | | | $ | (1) | | 68

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Goodwill impairment

29

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HUNTINGTON INGALLS INDUSTRIES, INC.CONSOLIDATED STATEMENTS OF CASH FLOWS | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | Year Ended December 31 | | ($ in millions) | | 2021 | | 2020 | | 2019 | | Operating Activities | | | | | | | | Net earnings | | $ | 544 | | | $ | 696 | | | $ | 549 | | | Adjustments to reconcile to net cash provided by (used in) operating activities | | | | | | | | Depreciation | | 207 | | | 191 | | | 180 | | | Amortization of purchased intangibles | | 86 | | | 56 | | | 47 | | | Amortization of debt issuance costs | | 8 | | | 7 | | | 3 | | | Provision for doubtful accounts | | 7 | | | (1) | | | (6) | | | Stock-based compensation | | 33 | | | 23 | | | 30 | | | Deferred income taxes | | 98 | | | 23 | | | 97 | | | | | | | | | | | Goodwill impairment | | — | | | — | | | 29 | | | Loss on early extinguishment of debt | | — | | | 21 | | | — | | | Loss (gain) on investments in marketable securities | | (19) | | | (17) | | | (11) | | | Asset impairments | | — | | | 13 | | | 6 | | | Change in | | | | | | | | Accounts receivable | | 58 | | | (70) | | | (51) | | | Contract assets | | (126) | | | 22 | | | 32 | | | Inventoried costs | | (25) | | | 11 | | | (11) | | | Prepaid expenses and other assets | | (88) | | | (62) | | | (93) | | | Accounts payable and accruals | | 45 | | | 344 | | | 4 | | | Retiree benefits | | (78) | | | (176) | | | 80 | | | Other non-cash transactions, net | | 10 | | | 12 | | | 11 | | | Net cash provided by operating activities | | 760 | | | 1,093 | | | 896 | | | Investing Activities | | | | | | | | Capital expenditures | | | | | | | | Capital expenditure additions | | (331) | | | (353) | | | (530) | | | Grant proceeds for capital expenditures | | 20 | | | 17 | | | 94 | | | Acquisitions of businesses, net of cash received | | (1,643) | | | (417) | | | (195) | | | Investment in affiliates | | (22) | | | — | | | — | | | Proceeds from disposition of business | | 20 | | | — | | | — | | | | | | | | | | | Other investing activities, net | | 2 | | | (6) | | | 4 | | | Net cash used in investing activities | | (1,954) | | | (759) | | | (627) | | | Financing Activities | | | | | | | | Proceeds from issuance of long-term debt | | 1,650 | | | 1,000 | | | — | | | Repayment of long-term debt | | (25) | | | (600) | | | — | | | Proceeds from line of credit borrowings | | — | | | 385 | | | 5,119 | | | Repayment of line of credit borrowings | | — | | | (385) | | | (5,119) | | | Debt issuance costs | | (22) | | | (13) | | | — | | | Premiums and fees related to early extinguishment of debt | | — | | | (15) | | | — | | | Dividends paid | | (186) | | | (172) | | | (149) | | | Repurchases of common stock | | (101) | | | (84) | | | (262) | | | Employee taxes on certain share-based payment arrangements | | (7) | | | (13) | | | (23) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Net cash provided by (used in) financing activities | | 1,309 | | | 103 | | | (434) | | | Change in cash and cash equivalents | | 115 | | | 437 | | | (165) | | | Cash and cash equivalents, beginning of period | | 512 | | | 75 | | | 240 | | | Cash and cash equivalents, end of period | | $ | 627 | | | $ | 512 | | | $ | 75 | | | Supplemental Cash Flow Disclosure | | | | | | | | Cash paid for income taxes (net of refunds) | | $ | 33 | | | $ | 155 | | | $ | 137 | | | Cash paid for interest | | $ | 76 | | | $ | 89 | | | $ | 75 | | | Non-Cash Investing and Financing Activities | | | | | | | | Capital expenditures accrued in accounts payable | | $ | 6 | | | $ | 7 | | | $ | 22 | | | | | | | | | | | | | | | | | | The accompanying notes are an integral part of these consolidated financial statements.63

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Audit methodology sample size

200

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CMS Actions CMS regularly audits the Company’s performance to determine its compliance with CMS’s regulations and its contracts with CMS and to assess the quality of services it provides to Medicare beneficiaries. CMS uses various payment mechanisms to allocate and adjust premium payments to the Company’s and other companies’ Medicare plans by considering the applicable health status of Medicare members as supported by information prepared, maintained and provided by providers. The Company collects claim and encounter data from providers and generally relies on providers to appropriately code their submissions to the Company and document their medical records, including the diagnosis data submitted to the Company with claims. CMS pays increased premiums to Medicare Advantage plans and Medicare PDP plans for members who have certain medical conditions identified with specific diagnosis codes. Federal regulators review and audit the providers’ medical records to determine whether those records support the related diagnosis codes that determine the members’ health status and the resulting risk-adjusted premium payments to the Company. In that regard, CMS has instituted risk adjustment data validation (“RADV”) audits of various Medicare Advantage plans, including certain of the Company’s plans, to validate coding practices and supporting medical record documentation maintained by providers and the resulting risk adjusted premium payments to the plans. CMS may require the Company to refund premium payments if the Company’s risk adjusted premiums are not properly supported by medical record data. The Office of the Inspector General of the HHS (the “OIG”) also is auditing the Company’s risk adjustment-related data and that of other companies. The Company expects CMS and the OIG to continue these types of audits. In 2012, CMS revised its audit methodology for RADV audits to determine refunds payable by Medicare Advantage plans for contract year 2011 and forward. Under the revised methodology, among other things, CMS will extrapolate the error rate identified in the audit sample of approximately 200 members to all risk adjusted premium payments made under the contract being audited. For contract years prior to 2011, CMS did not extrapolate sample error rates to the entire contract. As a result, the revised methodology may increase the Company’s exposure to premium refunds to CMS based on incomplete medical records maintained by providers. Since 2013, CMS has selected certain of the Company’s Medicare Advantage contracts for various contract years for RADV audit, and the number of RADV audits continues to increase. The Company is currently unable to predict which of its Medicare Advantage contracts will be selected for future audit, the amounts of any retroactive refunds of, or prospective adjustments to, Medicare Advantage premium payments made to the Company, the effect of any such refunds or adjustments on the actuarial soundness of the Company’s Medicare Advantage bids, or whether any RADV audit findings would require the Company to change its method of estimating future premium revenue in future bid submissions to CMS or compromise premium assumptions made in the Company’s bids for prior contract years, the current contract year or future contract years. Any premium or fee refunds or adjustments resulting from regulatory audits, whether as a result of RADV, Public Exchange related or other audits by CMS, the OIG or otherwise, including audits of the Company’s MLR rebates, methodology and/or reports, could be material and could adversely affect the Company’s operating results, cash flows and/or financial condition. Medicare and Medicaid CIDs The Company has received CIDs from the Civil Division of the DOJ in connection with a current investigation of the Company’s patient chart review processes in connection with risk adjustment data submissions under Parts C and D of the Medicare program. The Company has been cooperating with the government and providing documents and information in response to these CIDs. In May 2017, the Company received a CID from the SDNY requesting documents and information concerning possible false claims submitted to Medicare in connection with reimbursements for prescription drugs under the Medicare Part D program. The Company has been cooperating with the government and providing documents and information in response to this CID. Stockholder Matters Beginning in February 2019, multiple class action complaints, as well as a derivative complaint, were filed by putative plaintiffs against the Company and certain current and former officers and directors. The plaintiffs in these cases assert a variety of causes of action under federal securities laws that are premised on allegations that the defendants made certain omissions and misrepresentations relating to the performance of the Company’s LTC business unit. The Company and its current and former officers and directors are defending themselves against these claims. Since filing, several of the cases have been consolidated, and the first-filed federal case, City of Miami Fire Fighters’ and Police Officers’ Retirement Trust, et al. (formerly known as Anarkat), was dismissed with prejudice in February 2021. Plaintiffs have appealed that decision to the First Circuit after their motion for reconsideration was denied. In re CVS Health Corp. Securities Act Litigation (formerly known as Waterford) and In 167

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Weight of return on investment (ROI) on awards

50

SEC-NUM

[Table of Contents](#i988dd6b5140d4a1b8c6b4c50f020743f_10)appreciation rights, other stock-based awards, and cash-based awards at the discretion of the Management Development and Compensation Committee of the Board of Directors (the "Committee") that administers the ICP. Additionally, restricted stock, which may be deferred into RSU’s, may be awarded under a Restricted Stock and Deferred Compensation Plan for Non-Employee Directors. PERFORMANCE SHARE PLAN Under the Performance Share Plan ("PSP"), contingent awards of International Paper common stock are granted by the Committee. The PSP awards are earned over a three-year period. PSP awards are earned based on the achievement of defined performance of Return on Invested Capital ("ROIC") measured against our internal benchmark and ranking of Total Shareholder Return ("TSR") compared to the TSR peer group of companies. The 2019-2021, 2020-2022 and 2021-2023 Awards are weighted 50% ROIC and 50% TSR for all participants. The ROIC component of the PSP awards is valued at the closing stock price on the day prior to the grant date. As the ROIC component contains a performance condition, compensation expense, net of estimated forfeitures, is recorded over the requisite service period based on the most probable number of awards expected to vest. The TSR component of the PSP awards is valued using a Monte Carlo simulation as the TSR component contains a market condition. The Monte Carlo simulation estimates the fair value of the TSR component based on the expected term of the award, a risk-free rate, expected dividends, and the expected volatility for the Company and its competitors. The expected term is estimated based on the vesting period of the awards, the risk-free rate is based on the yield on U.S. Treasury securities matching the vesting period, and the volatility is based on the Company’s historical volatility over the expected term. PSP grants are made in performance-based restricted stock units. The following table sets forth the assumptions used to determine compensation cost for the market condition component of the PSP plan: | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | Twelve Months Ended December 31, 2021 | | Expected volatility | 24.36% - 36.92% | | Risk-free interest rate | 0.17% - 2.44% | The following summarizes PSP activity for the three years ended December 31, 2021: | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Share/Units | WeightedAverageGrant DateFair Value | | Outstanding at December 31, 2018 | 5,766,477 | | $38.79 | | | Granted | 2,353,613 | | 43.49 | | | Shares issued | (2,367,135) | | 36.79 | | | Forfeited | (238,227) | | 50.64 | | | Outstanding at December 31, 2019 | 5,514,728 | | 41.14 | | | Granted | 2,171,385 | | 49.15 | | | Shares issued | (1,221,950) | | 51.70 | | | Forfeited | (844,138) | | 51.70 | | | Outstanding at December 31, 2020 | 5,620,025 | | 40.36 | | | Granted | 2,316,295 | | 45.24 | | | Shares issued | (994,052) | | 63.54 | | | Forfeited | (1,016,126) | | 57.55 | | | Outstanding at December 31, 2021 | 5,926,142 | | $35.43 | | RESTRICTED STOCK AWARD PROGRAMS The service-based Restricted Stock Award program ("RSA"), designed for recruitment, retention and special recognition purposes, provides for awards of restricted stock to key employees. The following summarizes the activity of the RSA program for the three years ended December 31, 2021: | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Shares | WeightedAverageGrant DateFair Value | | Outstanding at December 31, 2018 | 132,111 | | $50.17 | | | Granted | 87,910 | | 43.70 | | | Shares issued | (52,021) | | 48.90 | | | Forfeited | (7,300) | | 45.10 | | | Outstanding at December 31, 2019 | 160,700 | | 47.27 | | | Granted | 82,228 | | 40.12 | | | Shares issued | (83,053) | | 44.25 | | | Forfeited | (33,800) | | 46.43 | | | Outstanding at December 31, 2020 | 126,075 | | 44.83 | | | Granted | 85,098 | | 50.90 | | | Shares issued | (85,768) | | 45.59 | | | Forfeited | (21,636) | | 45.52 | | | Outstanding at December 31, 2021 | 103,769 | | $49.03 | | At December 31, 2021, 2020 and 2019 a total of 7.7 million, 8.5 million and 9.8 million shares, respectively, were available for grant under the ICP. 88

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Planned generation sold forward from non utility nuclear power plants

99

SEC-NUM

[Table of Contents](#i6266d2788e5849989ad57be380853c2d_7)Entergy Corporation and SubsidiariesNotes to Financial Statements The Utility has limited exposure to the effects of market risk because it operates primarily under cost-based rate regulation. To the extent approved by their retail regulators, the Utility operating companies use derivative instruments to hedge the exposure to price volatility inherent in their purchased power, fuel, and gas purchased for resale costs, that are recovered from customers. As a wholesale generator, Entergy Wholesale Commodities’ core business is selling energy, measured in MWh, to its customers. Entergy Wholesale Commodities entered into forward contracts with its customers and also sold energy and capacity in the day ahead or spot markets. In addition to its forward physical power and gas contracts, Entergy Wholesale Commodities used a combination of financial contracts, including swaps, collars, and options, to mitigate commodity price risk. When the market price fell, the combination of financial contracts was expected to settle in gains that offset lower revenue from generation, which resulted in a more predictable cash flow. Consistent with management’s strategy to shut down and sell all plants in the Entergy Wholesale Commodities merchant fleet, the Entergy Wholesale Commodities portfolio of derivative instruments expired in April 2021, which was the settlement date for the last financial derivative contracts in the Entergy Wholesale Commodities portfolio. Entergy’s exposure to market risk is determined by a number of factors, including the size, term, composition, and diversification of positions held, as well as market volatility and liquidity. For instruments such as options, the time period during which the option may be exercised and the relationship between the current market price of the underlying instrument and the option’s contractual strike or exercise price also affects the level of market risk. A significant factor influencing the overall level of market risk to which Entergy is exposed is its use of hedging techniques to mitigate such risk. Hedging instruments and volumes are chosen based on ability to mitigate risk associated with future energy and capacity prices; however, other considerations are factored into hedge product and volume decisions including corporate liquidity, corporate credit ratings, counterparty credit risk, hedging costs, firm settlement risk, and product availability in the marketplace. Entergy manages market risk by actively monitoring compliance with stated risk management policies as well as monitoring the effectiveness of its hedging policies and strategies. Entergy’s risk management policies limit the amount of total net exposure and rolling net exposure during the stated periods. These policies, including related risk limits, are regularly assessed to ensure their appropriateness given Entergy’s objectives. Derivatives Some derivative instruments are classified as cash flow hedges due to their financial settlement provisions while others are classified as normal purchase/normal sale transactions due to their physical settlement provisions. Normal purchase/normal sale risk management tools include power purchase and sales agreements, fuel purchase agreements, capacity contracts, and tolling agreements. Financially-settled cash flow hedges can include natural gas and electricity swaps and options. Entergy may enter into financially-settled swap and option contracts to manage market risk that may or may not be designated as hedging instruments. Entergy entered into derivatives to manage natural risks inherent in its physical or financial assets or liabilities. Electricity over-the-counter instruments and futures contracts that financially settled against day-ahead power pool prices were used to manage price exposure for Entergy Wholesale Commodities generation. Planned generation currently under contract from Entergy Wholesale Commodities nuclear power plants is 99% for 2022, all of which is sold under normal purchase/normal sale contracts. Total planned generation for 2022 is 2.8 TWh. Entergy used standardized master netting agreements to help mitigate the credit risk of derivative instruments. These master agreements facilitated the netting of cash flows associated with a single counterparty and may have included collateral requirements. Cash, letters of credit, and parental/affiliate guarantees were obtained as security from counterparties in order to mitigate credit risk. The collateral agreements required a counterparty to post cash or letters of credit in the event an exposure exceeded an established threshold. The threshold represented an unsecured credit limit, which may have been supported by a parental/affiliate guarantee, as determined in 201

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Comprehensive (earnings) losses attributable to noncontrolling interests

2

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[Table of Contents](#i56e1b64ac11b4f908f713ce45f591ccd_10) Altria Group, Inc. and SubsidiariesCondensed Consolidated Statements of Comprehensive Earnings (Losses)(in millions of dollars)(Unaudited)\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | For the Nine Months Ended September 30, | | For the Three Months Ended September 30, | | | | 2022 | | 2021 | | 2022 | | 2021 | | Net earnings (losses) | | $ | 3,074 | | | $ | 851 | | | $ | 224 | | | $ | (2,720) | | | Other comprehensive earnings (losses), net of deferred income taxes: | | | | | | | | | | Benefit plans | | 48 | | | 383 | | | 17 | | | 6 | | | ABI | | 637 | | | 495 | | | (6) | | | 161 | | | Currency translation adjustments and other | | (12) | | | 33 | | | (17) | | | 5 | | | Other comprehensive earnings (losses), net of deferred income taxes | | 673 | | | 911 | | | (6) | | | 172 | | | | | | | | | | | | | Comprehensive earnings (losses) | | 3,747 | | | 1,762 | | | 218 | | | (2,548) | | | Comprehensive (earnings) losses attributable to noncontrolling interests | | — | | | — | | | — | | | (2) | | | Comprehensive earnings (losses) attributable to Altria | | $ | 3,747 | | | $ | 1,762 | | | $ | 218 | | | $ | (2,550) | | See notes to condensed consolidated financial statements.6

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Return to accrual

2

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FOX CORPORATIONNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSThe reconciliation of income tax computed at the statutory rate to income tax expense was: | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | For the years ended June 30, | | | 2022 | | 2021 | | 2020 | | U.S. federal income tax rate | 21 | % | | 21 | % | | 21 | % | | State and local taxes | 4 | | | 4 | | | 4 | | | Nondeductible compensation | 1 | | | 1 | | | 2 | | | Valuation allowance movements | — | | | — | | | 1 | | | Adjustments for tax matters, net | — | | | (1) | | | (1) | | | Return to accrual(a) | 2 | | | — | | | — | | | Other | (1) | | | — | | | — | | | Effective tax rate | 27 | % | | 25 | % | | 27 | % | | | | | | --- | --- | --- | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | (a) | Primarily attributable to a remeasurement of the Company's net deferred tax assets associated with changes in the mix of jurisdictional earnings. | The following is a summary of the components of the deferred tax accounts: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | As of June 30, | | | 2022 | | 2021 | | | (in millions) | | Deferred tax assets | | | | | Basis difference(a) | $ | 3,371 | | | $ | 3,676 | | | Operating lease liabilities | 123 | | | 121 | | | Pension benefit obligations | 34 | | | 64 | | | Equity-based compensation | 30 | | | 33 | | | Accrued liabilities | — | | | 37 | | | Net operating loss carryforwards | 31 | | | 18 | | | Other | 104 | | | 117 | | | Total deferred tax assets | 3,693 | | | 4,066 | | | Deferred tax liabilities | | | | | Operating lease ROU assets | (116) | | | (114) | | | Accrued liabilities | (2) | | | — | | | Sports rights contracts | (108) | | | (108) | | | Total deferred tax liabilities | (226) | | | (222) | | | Net deferred tax asset before valuation allowance | 3,467 | | | 3,844 | | | Less: valuation allowance | (34) | | | (24) | | | Total net deferred tax assets(b) | $ | 3,433 | | | $ | 3,820 | | | | | | | --- | --- | --- | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | (a) | As a result of the Separation and the Distribution, which was a taxable transaction for which the estimated tax liability of $5.8 billion was included in the Transaction Tax paid by the Company, FOX obtained a tax basis in its assets equal to their respective fair market values. This amount includes the additional estimated deferred tax asset recorded as a result of the increased tax basis (See Note 1—Description of Business and Basis of Presentation under the heading "Basis of Presentation"). | | (b) | Includes a $7 million and $2 million deferred tax liability recorded in Other liabilities on the Consolidated Balance Sheet as of June 30, 2022 and 2021, respectively. | As of June 30, 2022, the Company had $31 million of tax attributes from net operating loss carryforwards available to offset future taxable income. A substantial portion of these losses can be carried forward indefinitely.101

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Other Assets

14.0

SEC-NUM

[Table of Contents](#i3d0ebbc4e2a2420f98ed7e6fe698936a_7) HASBRO, INC. AND SUBSIDIARIESNotes to Consolidated Financial Statements — (Continued) (22) eOne Music SaleOn April 25, 2021, the Company entered into a definitive agreement to sell eOne Music for an aggregate sales price of $385.0 million, subject to certain closing adjustments related to working capital and net debt. On June 29, 2021, the Company completed the sale of eOne Music for net proceeds of $397.0 million, including the sales price of $385.0 million and $12.0 million of closing adjustments related to working capital and net debt calculations. The final proceeds were subject to further adjustment upon completion of closing working capital, which resulted in a net outflow of $0.9 million. The Company acquired eOne Music through its acquisition of eOne in December 2019. Based on the value of the net assets held by eOne Music, which included goodwill and intangible assets allocated to eOne Music as part of the eOne acquisition, the Company recorded a pre-tax non-cash goodwill impairment charge of $108.8 million within Loss on Disposal of Business on the Consolidated Statements of Operations for the year ended December 26, 2021. The Company also recorded pre-tax cash transaction expenses of $9.5 million within Selling, Distribution and Administration expenses on the Consolidated Statements of Operations during the second quarter of 2021. The impairment charge was recorded within the Entertainment segment and the transaction costs were recorded within the Corporate and Other segment. The operations of eOne Music did not meet the criteria to be presented as discontinued operations in accordance with Accounting Standards Update No. 2014-08 (ASU 2014-08) Presentation of Financial Statements (Topic 205) and Property, Plant and Equipment (Topic 360) - Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity and eOne Music did not represent an individually significant component of the Company’s business. Income from operations before income taxes, attributable to eOne Music, was recorded to the Company's Consolidated Statements of Operations, within the Entertainment segment through the sale transaction closing date. Assets of $473.5 million and liabilities of $77.3 million, attributable to eOne Music, were de-consolidated as of the closing date and, as of December 26, 2021, there are no remaining carrying amounts in the Company's Consolidated Balance Sheets.The following table presents the carrying amounts of the major classes of eOne Music assets and liabilities sold on June 29, 2021 and reflects final working capital adjustments. | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | (In millions) | December 26,2021 | | Cash and Cash Equivalents | $ | 18.2 | | | Goodwill and Other Intangible Assets | 410.3 | | | Prepaid Expenses | 31.0 | | | Other Assets | 14.0 | | | Total Assets | 473.5 | | | | | | Accrued Liabilities | 24.4 | | Deferred Taxes | 36.9 | | Other Liabilities | 16.0 | | Total Liabilities | $ | 77.3 | | 126

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

7,479

SEC-NUM

THE HERSHEY COMPANYNOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)(amounts in thousands, except share data or if otherwise indicated) The effect of derivative instruments on the Consolidated Statements of Income for the nine months ended October 2, 2022 and October 3, 2021 was as follows: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Non-designated Hedges | | Cash Flow Hedges | | | | Gains (losses) recognized in income (a) | | Gains (losses) recognized in other comprehensive income (“OCI”) | | Gains (losses) reclassified from accumulated OCI (“AOCI”) into income (b) | | | | | | 2022 | | 2021 | | 2022 | | 2021 | | 2022 | | 2021 | | | | | | Commodities futures and options | | $ | 28,027 | | | $ | 64,199 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | | | | | Foreign exchange contracts | | (173) | | | 574 | | | 245 | | | (2,200) | | | (956) | | | (5,174) | | | | | | | Interest rate swap agreements | | — | | | — | | | — | | | — | | | (8,187) | | | (8,353) | | | | | | | Deferred compensation derivatives | | (6,142) | | | 3,592 | | | — | | | — | | | — | | | — | | | | | | | Total | | $ | 21,712 | | | $ | 68,365 | | | $ | 245 | | | $ | (2,200) | | | $ | (9,143) | | | $ | (13,527) | | | | | | (a)Gains (losses) recognized in income for non-designated commodities futures and options contracts were included in cost of sales. Gains (losses) recognized in income for non-designated foreign currency forward exchange contracts and deferred compensation derivatives were included in selling, marketing and administrative expenses.(b)Gains (losses) reclassified from AOCI into income for foreign currency forward exchange contracts were included in selling, marketing and administrative expenses. Losses reclassified from AOCI into income for interest rate swap agreements were included in interest expense.The amount of pre-tax net losses on derivative instruments, including interest rate swap agreements and foreign currency forward exchange contracts expected to be reclassified into earnings in the next 12 months was approximately $7,479 as of October 2, 2022. This amount is primarily associated with interest rate swap agreements.6. FAIR VALUE MEASUREMENTSAccounting guidance on fair value measurements requires that financial assets and liabilities be classified and disclosed in one of the following categories of the fair value hierarchy: | | | | | --- | --- | --- | | | | | | Level 1 – Based on unadjusted quoted prices for identical assets or liabilities in an active market. | | Level 2 – Based on observable market-based inputs or unobservable inputs that are corroborated by market data. | | Level 3 – Based on unobservable inputs that reflect the entity’s own assumptions about the assumptions that a market participant would use in pricing the asset or liability. | We did not have any Level 3 financial assets or liabilities, nor were there any transfers between levels during the periods presented. | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | [Table of Contents](#i0bc28196a24d4084af1a4cbdf6bdf4bd_7) | The Hershey Company | Q3 2022 Form 10-Q | Page 17 | hsy-20221002_g2.jpg |

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Purchases of intangible assets

1,583

SEC-NUM

[Table of](#i090043fcb1da400aaac214abf3d3ee98_7) [Contents](#i090043fcb1da400aaac214abf3d3ee98_7)CADENCE DESIGN SYSTEMS, INC.CONSOLIDATED STATEMENTS OF CASH FLOWSFor the three fiscal years ended January 1, 2022(In thousands) | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | 2021 | | 2020 | | 2019 | | Cash and cash equivalents at beginning of year | $ | 928,432 | | | $ | 705,210 | | | $ | 533,298 | | | Cash flows from operating activities: | | | | | | | Net income | 695,955 | | | 590,644 | | | 988,979 | | | Adjustments to reconcile net income to net cash provided by operating activities: | | | | | | | Depreciation and amortization | 142,308 | | | 145,653 | | | 122,789 | | | Amortization of debt discount and fees | 1,219 | | | 1,053 | | | 1,001 | | | Stock-based compensation | 210,090 | | | 197,268 | | | 181,547 | | | (Gain) loss on investments, net | (580) | | | 4,954 | | | 4,090 | | | Deferred income taxes | (43,178) | | | (26,117) | | | (576,738) | | | Provisions for losses on receivables | 525 | | | 1,628 | | | 632 | | | ROU asset amortization and change in operating lease liabilities | (11,606) | | | 4,483 | | | 562 | | | Other non-cash items | 427 | | | 773 | | | 428 | | | Changes in operating assets and liabilities, net of effect of acquired businesses: | | | | | | | Receivables | 2,014 | | | (25,934) | | | (4,718) | | | Inventories | (39,027) | | | (25,685) | | | (33,024) | | | Prepaid expenses and other | (34,342) | | | (31,167) | | | (11,031) | | | Other assets | (7,133) | | | (71,606) | | | (8,011) | | | Accounts payable and accrued liabilities | 67,356 | | | 18,394 | | | 33,915 | | | Deferred revenue | 100,731 | | | 110,173 | | | 27,498 | | | Other long-term liabilities | 16,199 | | | 10,408 | | | 1,681 | | | Net cash provided by operating activities | 1,100,958 | | | 904,922 | | | 729,600 | | | Cash flows from investing activities: | | | | | | | Purchases of non-marketable investments | — | | | — | | | (33,717) | | | Proceeds from the sale of non-marketable investments | 128 | | | 217 | | | 2,952 | | | Purchases of property, plant and equipment | (65,298) | | | (94,813) | | | (74,605) | | | Purchases of intangible assets | (1,583) | | | — | | | — | | | Cash paid in business combinations and asset acquisitions, net of cash acquired | (226,201) | | | (197,562) | | | (338) | | | Net cash used for investing activities | (292,954) | | | (292,158) | | | (105,708) | | | Cash flows from financing activities: | | | | | | | Proceeds from revolving credit facility | — | | | 350,000 | | | 150,000 | | | Payment on revolving credit facility | — | | | (350,000) | | | (250,000) | | | Payment of debt issuance costs | (1,285) | | | — | | | — | | | Proceeds from issuance of common stock | 87,772 | | | 74,803 | | | 52,842 | | | Stock received for payment of employee taxes on vesting of restricted stock | (117,982) | | | (110,028) | | | (90,580) | | | Payments for repurchases of common stock | (612,297) | | | (380,064) | | | (306,148) | | | Net cash used for financing activities | (643,792) | | | (415,289) | | | (443,886) | | | Effect of exchange rate changes on cash and cash equivalents | (3,704) | | | 25,747 | | | (8,094) | | | Increase in cash and cash equivalents | 160,508 | | | 223,222 | | | 171,912 | | | Cash and cash equivalents at end of year | $ | 1,088,940 | | | $ | 928,432 | | | $ | 705,210 | | | | | | | | | | Supplemental cash flow information: | | | | | | | Cash paid for interest | $ | 15,950 | | | $ | 19,778 | | | $ | 17,842 | | | Cash paid for income taxes, net | 146,424 | | | 105,917 | | | 41,946 | | See notes to consolidated financial statements.53

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Construction defect portion of loss contingency accrual, percentage

99

SEC-NUM

[Table of Contents](#if5e2d1c13bd74a82945554c9f702e646_7) D.R. HORTON, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) – (Continued)June 30, 2022NOTE K – COMMITMENTS AND CONTINGENCIES Warranty Claims The Company provides its homebuyers with a ten-year limited warranty for major defects in structural elements such as framing components and foundation systems, a two-year limited warranty on major mechanical systems and a one-year limited warranty on other construction components. The Company’s warranty liability is based upon historical warranty cost experience in each market in which it operates and is adjusted to reflect qualitative risks associated with the types of homes built and the geographic areas in which they are built. Changes in the Company’s warranty liability during the three and nine months ended June 30, 2022 and 2021 were as follows: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months EndedJune 30, | | Nine Months EndedJune 30, | | | | 2022 | | 2021 | | 2022 | | 2021 | | | | (In millions) | | Warranty liability, beginning of period | | $ | 407.8 | | | $ | 340.7 | | | $ | 376.3 | | | $ | 310.2 | | | Warranties issued | | 49.1 | | | 41.8 | | | 131.6 | | | 111.5 | | | Changes in liability for pre-existing warranties | | 5.8 | | | 1.7 | | | 13.1 | | | 5.4 | | | Settlements made | | (30.9) | | | (22.7) | | | (89.2) | | | (65.6) | | | Warranty liability, end of period | | $ | 431.8 | | | $ | 361.5 | | | $ | 431.8 | | | $ | 361.5 | | Legal Claims and Insurance The Company is named as a defendant in various claims, complaints and other legal actions in the ordinary course of business. At any point in time, the Company is managing several hundred individual claims related to construction defect matters, personal injury claims, employment matters, land development issues, contract disputes and other matters. The Company has established reserves for these contingencies based on the estimated costs of pending claims and the estimated costs of anticipated future claims related to previously closed homes. The estimated liabilities for these contingencies were $674.4 million and $577.5 million at June 30, 2022 and September 30, 2021, respectively, and are included in accrued expenses and other liabilities in the consolidated balance sheets. Approximately 99% of these reserves related to construction defect matters at both June 30, 2022 and September 30, 2021. Expenses related to the Company’s legal contingencies were $90.7 million and $46.2 million in the nine months ended June 30, 2022 and 2021, respectively. Changes in the Company’s legal claims reserves during the nine months ended June 30, 2022 and 2021 were as follows: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | Nine Months EndedJune 30, | | | 2022 | | 2021 | | | (In millions) | | Reserves for legal claims, beginning of period | $ | 577.5 | | | $ | 473.8 | | | Increase in reserves | 119.1 | | | 88.8 | | | Payments | (22.2) | | | (19.5) | | | Reserves for legal claims, end of period | $ | 674.4 | | | $ | 543.1 | | 27

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Cash received

0.5

SEC-NUM

[Table of Contents](#i4552998170a04ab690e0e4bebd2d8dfd_7) FMC CORPORATIONNotes to Condensed Consolidated Financial Statements (unaudited) — (Continued) The estimated reasonably possible environmental loss contingencies, net of expected recoveries, exceed amounts accrued by approximately $160 million at September 30, 2022. This reasonably possible estimate is based upon information available as of the date of the filing but the actual future losses may be higher given the uncertainties regarding the status of laws, regulations, enforcement policies, the impact of potentially responsible parties, technology and information related to individual sites. Potential environmental obligations that have not been reserved may be material to any one quarter's or year's results of operations in the future. However, we believe any such liability arising from such potential environmental obligations is not likely to have a material adverse effect on our liquidity or financial condition as it may be satisfied over many years.The table below provides a roll forward of our environmental recoveries representing probable realization of claims against insurance carriers and other third parties. These recoveries are recorded as "Prepaid and other current assets" and "Other assets including long-term receivables, net" in the condensed consolidated balance sheets. | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (in Millions) | December 31, 2021 | | Increase (Decrease) in recoveries | | Cash received | | | | September 30, 2022 | | Environmental recoveries | $ | 4.5 | | | $ | 2.0 | | | $ | (0.5) | | | | | $ | 6.0 | | | | | | | | | | | | | Our net environmental provisions relate to costs for the continued cleanup of both continuing and discontinued manufacturing operations from previous years. The net provisions are comprised as follows: | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended September 30, | | Nine Months Ended September 30, | | (in Millions) | 2022 | | 2021 | | 2022 | | 2021 | | Environmental provisions, net - recorded to liabilities (1) | $ | 7.3 | | | $ | 8.1 | | | $ | 10.4 | | | $ | 15.6 | | | Environmental provisions, net - recorded to assets (2) | (0.1) | | | (0.1) | | | (2.0) | | | (0.7) | | | Environmental provision, net | $ | 7.2 | | | $ | 8.0 | | | $ | 8.4 | | | $ | 14.9 | | | | | | | | | | | | Continuing operations (3) | $ | 3.4 | | | $ | 3.7 | | | $ | 1.0 | | | $ | 3.3 | | | Discontinued operations (4) | 3.8 | | | 4.3 | | | 7.4 | | | 11.6 | | | Environmental provision, net | $ | 7.2 | | | $ | 8.0 | | | $ | 8.4 | | | $ | 14.9 | | \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(1)See above roll forward of our total environmental reserves as presented on the condensed consolidated balance sheets.(2)See above roll forward of our total environmental recoveries as presented on the condensed consolidated balance sheets.(3)Recorded as a component of "Restructuring and other charges (income)" on the condensed consolidated statements of income (loss). See Note 9. Environmental obligations for continuing operations primarily represent obligations at shut down or abandoned facilities within businesses that do not meet the criteria for presentation as discontinued operations.(4)Recorded as a component of "Discontinued operations, net of income taxes" on the condensed consolidated statements of income (loss). See Note 11. A more complete description of our environmental contingencies and the nature of our potential obligations are included in Notes 1 and 12 to our consolidated financial statements in our 2021 Form 10-K. See Note 12 to our consolidated financial statements in our 2021 Form 10-K for a description of significant updates to material environmental sites. There have been no significant updates since the information included in our 2021 Form 10-K other than the update provided below. Note 13: Earnings Per ShareEarnings per common share ("EPS") is computed by dividing net income by the weighted average number of common shares outstanding during the period on a basic and diluted basis.Our potentially dilutive securities include potential common shares related to our stock options, restricted stock and restricted stock units. Diluted earnings per share ("Diluted EPS") considers the impact of potentially dilutive securities except in periods in which there is a loss from continuing operations because the inclusion of the potential common shares would have an antidilutive effect. Diluted EPS excludes the impact of potential common shares related to our stock options in periods in which the option exercise price is greater than the average market price of our common stock for the period. For the three and nine months ended September 30, 2022 there were 0.5 million and 0.4 million potential common shares excluded from Diluted EPS, 32

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Preferred stock, par value

0.0001

SEC-NUM

[Table of Contents](#i11f673a761214399ab28a3a12dfa4686_7)PART I—FINANCIAL INFORMATION ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS ADOBE INC.CONDENSED CONSOLIDATED BALANCE SHEETS(In millions, except par value) | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | September 2,2022 | | December 3,2021 | | | (Unaudited) | | (\*) | | ASSETS | | | | | Current assets: | | | | | Cash and cash equivalents | $ | 3,870 | | | $ | 3,844 | | | Short-term investments | 1,894 | | | 1,954 | | | Trade receivables, net of allowances for doubtful accounts of $24 and $16, respectively | 1,723 | | | 1,878 | | | Prepaid expenses and other current assets | 1,002 | | | 993 | | | Total current assets | 8,489 | | | 8,669 | | | Property and equipment, net | 1,858 | | | 1,673 | | | Operating lease right-of-use assets, net | 414 | | | 443 | | | Goodwill | 12,756 | | | 12,668 | | | Other intangibles, net | 1,548 | | | 1,820 | | | Deferred income taxes | 799 | | | 1,085 | | | Other assets | 880 | | | 883 | | | Total assets | $ | 26,744 | | | $ | 27,241 | | | | | | | | LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | | Current liabilities: | | | | | Trade payables | $ | 316 | | | $ | 312 | | | Accrued expenses | 1,629 | | | 1,736 | | | Debt | 500 | | | — | | | Deferred revenue | 4,829 | | | 4,733 | | | Income taxes payable | 76 | | | 54 | | | Operating lease liabilities | 88 | | | 97 | | | Total current liabilities | 7,438 | | | 6,932 | | | Long-term liabilities: | | | | | Debt | 3,627 | | | 4,123 | | | Deferred revenue | 114 | | | 145 | | | Income taxes payable | 510 | | | 534 | | | Deferred income taxes | 3 | | | 5 | | | Operating lease liabilities | 426 | | | 453 | | | Other liabilities | 253 | | | 252 | | | Total liabilities | 12,371 | | | 12,444 | | | Stockholders’ equity: | | | | | Preferred stock, $0.0001 par value; 2 shares authorized; none issued | — | | | — | | | Common stock, $0.0001 par value; 900 shares authorized; 601 shares issued; 467 and 475 shares outstanding, respectively | — | | | — | | | Additional paid-in-capital | 9,548 | | | 8,428 | | | Retained earnings | 27,158 | | | 23,905 | | | Accumulated other comprehensive income (loss) | (224) | | | (137) | | | Treasury stock, at cost (134 and 126 shares, respectively) | (22,109) | | | (17,399) | | | Total stockholders’ equity | 14,373 | | | 14,797 | | | Total liabilities and stockholders’ equity | $ | 26,744 | | | $ | 27,241 | | \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(\*) The condensed consolidated balance sheet as of December 3, 2021 has been derived from the audited consolidated financial statements at that date but does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.[See accompanying notes to condensed consolidated financial statements.](#i11f673a761214399ab28a3a12dfa4686_31)3

string

Regulatory mechanism threshold (in percent)

75

SEC-NUM

| | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended June 30, 2022 | | Three Months Ended June 30, 2021 | | | Distribution | | Pipeline and Storage | | Distribution | | Pipeline and Storage | | | (In thousands) | | Gas sales revenues: | | | | | | | | | Residential | $ | 441,806 | | | $ | — | | | $ | 336,016 | | | $ | — | | | Commercial | 231,309 | | | — | | | 157,314 | | | — | | | Industrial | 57,045 | | | — | | | 25,348 | | | — | | | Public authority and other | 13,080 | | | — | | | 8,870 | | | — | | | Total gas sales revenues | 743,240 | | | — | | | 527,548 | | | — | | | Transportation revenues | 27,216 | | | 186,405 | | | 25,903 | | | 164,619 | | | Miscellaneous revenues | 2,453 | | | 3,104 | | | 2,615 | | | 3,895 | | | Revenues from contracts with customers | 772,909 | | | 189,509 | | | 556,066 | | | 168,514 | | | Alternative revenue program revenues (1) | (77) | | | (6,097) | | | 2,206 | | | (5,527) | | | Other revenues | 479 | | | — | | | 478 | | | — | | | Total operating revenues | $ | 773,311 | | | $ | 183,412 | | | $ | 558,750 | | | $ | 162,987 | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Nine Months Ended June 30, 2022 | | Nine Months Ended June 30, 2021 | | | Distribution | | Pipeline and Storage | | Distribution | | Pipeline and Storage | | | (In thousands) | | Gas sales revenues: | | | | | | | | | Residential | $ | 2,108,349 | | | $ | — | | | $ | 1,821,570 | | | $ | — | | | Commercial | 910,400 | | | — | | | 692,443 | | | — | | | Industrial | 160,098 | | | — | | | 81,122 | | | — | | | Public authority and other | 54,668 | | | — | | | 42,159 | | | — | | | Total gas sales revenues | 3,233,515 | | | — | | | 2,637,294 | | | — | | | Transportation revenues | 87,886 | | | 514,114 | | | 84,643 | | | 480,945 | | | Miscellaneous revenues | 7,732 | | | 11,931 | | | 8,336 | | | 12,921 | | | Revenues from contracts with customers | 3,329,133 | | | 526,045 | | | 2,730,273 | | | 493,866 | | | Alternative revenue program revenues (1) | 25,663 | | | (15,968) | | | (13,666) | | | (16,998) | | | Other revenues | 1,483 | | | — | | | 1,467 | | | — | | | Total operating revenues | $ | 3,356,279 | | | $ | 510,077 | | | $ | 2,718,074 | | | $ | 476,868 | | (1) In our distribution segment, we have weather-normalization adjustment mechanisms that serve to mitigate the effects of weather on our revenue. Additionally, APT has a regulatory mechanism that requires that we share with its tariffed customers 75% of the difference between the total non-tariffed revenues earned during a test period and a regulatorily determined revenue benchmark.Accounts receivable and allowance for uncollectible accountsAccounts receivable arise from natural gas sales to residential, commercial, industrial, public authority and other customers. Our accounts receivable balance includes unbilled amounts which represent a customer’s consumption of gas from the date of the last cycle billing through the last day of the month. The receivable balances are short term and generally do not extend beyond one month. To minimize credit risk, we assess the credit worthiness of new customers, require deposits where necessary, assess late fees, pursue collection activities and disconnect service for nonpayment. After disconnection, accounts are written off when deemed uncollectible. Our policy related to the accounting for our allowance for uncollectible accounts is fully described in Note 2 to the consolidated financial statements in our Annual Report on Form 10-K for the fiscal year ended September 30, 2021. During the nine months ended June 30, 2022, there were no material changes to this policy. Rollforwards of our allowance for uncollectible accounts for the three and nine months ended June 30, 2022 and 2021 are presented in the table below. The allowance excludes the gas cost portion of customers’ bills for approximately 79 percent of our customers as we have the ability to collect these gas costs through our gas cost recovery mechanisms in most of our jurisdictions.12

string

Cash acquired from Concho

382

SEC-NUM

| | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | Notes to Consolidated Financial Statements | [Table of Contents](#if18581573a6045f6b6e889320c9d1887_7) | Note 13—Cash Flow Information | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | Millions of Dollars | | | Six Months EndedJune 30 | | Cash Payments | 2022 | 2021 | | Interest | $ | 486 | | 464 | | | Income taxes | 3,942 | | 107 | | | | | | | Net Sales (Purchases) of Investments | | | | Short-term investments purchased | $ | (1,253) | | (5,439) | | | Short-term investments sold | 613 | | 6,842 | | | Long-term investments purchased | (510) | | (149) | | | Long-term investments sold | 46 | | 48 | | | | $ | (1,104) | | 1,302 | | In the first quarter of 2021, we acquired Concho in an all-stock transaction for $13.1 billion. In connection with this transaction, we acquired cash of $382 million, which is included in "Cash Flows From Investing Activities" on our consolidated statement of cash flows. Note 14—Employee Benefit PlansPension and Postretirement Plans | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Millions of Dollars | | | Pension Benefits | | Other Benefits | | | 2022 | | 2021 | | 2022 | | 2021 | | | U.S. | | Int'l. | | U.S. | | Int'l. | | | | | | Components of Net Periodic Benefit Cost | | | | | | | | | | | | | Three Months Ended June 30 | | | | | | | | | | | | | Service cost | $ | 16 | | | 13 | | | 18 | | | 16 | | | 1 | | | 1 | | Interest cost | 12 | | | 21 | | | 15 | | | 20 | | | 1 | | | 1 | | | Expected return on plan assets | (13) | | | (34) | | | (20) | | | (30) | | | — | | | — | | | Amortization of prior service credit | — | | | — | | | — | | | — | | | (10) | | | (10) | | | Recognized net actuarial loss | 5 | | | 2 | | | 12 | | | 8 | | | — | | | 1 | | | Settlements | 18 | | | — | | | 42 | | | — | | | — | | | — | | | Net periodic benefit cost | $ | 38 | | | 2 | | | 67 | | | 14 | | | (8) | | | (7) | | | | | | | | | | | | | | | | Six Months Ended June 30 | | | | | | | | | | | | | Service cost | $ | 32 | | | 26 | | | 39 | | | 31 | | | 1 | | | 1 | | | Interest cost | 24 | | | 42 | | | 28 | | | 40 | | | 2 | | | 2 | | | Expected return on plan assets | (26) | | | (68) | | | (44) | | | (60) | | | — | | | — | | | Amortization of prior service credit | — | | | — | | | — | | | — | | | (20) | | | (19) | | | Recognized net actuarial loss | 11 | | | 4 | | | 27 | | | 16 | | | — | | | 1 | | | Settlements | 22 | | | — | | | 44 | | | — | | | — | | | — | | | Curtailments | — | | | — | | | 12 | | | — | | | — | | | — | | | Special Termination Benefits | — | | | — | | | 9 | | | — | | | — | | | — | | | Net periodic benefit cost | $ | 63 | | | 4 | | | 115 | | | 27 | | | (17) | | | (15) | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | 25 | ConocoPhillips 2022 Q2 10-Q | |

string

Business combination, consideration transferred, equity interests issued and issuable

1.9

SEC-NUM

| | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | Company | Acquisition Date | Primary Segment | Description | | Bridge2 Solutions | February 21, 2020 | Exchanges | Bridge2 Solutions is a leading provider of loyalty solutions for merchants and consumers. Bridge2 Solutions enables some of the world’s leading brands to engage customers and drive loyalty. It powers incentive and employee perk programs for companies across a wide spectrum of industries. As of October 31, 2021, following the Bakkt transaction discussed below, we no longer consolidate Bridge2 Solutions. | | Simplifile, LC, or Simplifile | June 12, 2019 | Mortgage Technology | Simplifile offers an array of mortgage services, primarily serving as an electronic liaison between lenders, settlement agents and county recording offices, streamlining the local recording of residential mortgage transactions and is now part of ICE Mortgage Technology. See below for the Simplifile purchase price allocation. | During 2021 and 2019, we acquired multiple companies which were not material to our operations.Ellie Mae AcquisitionOn September 4, 2020, we acquired Ellie Mae for aggregate consideration of $11.4 billion from private equity firm Thoma Bravo. The purchase price consisted of $9.5 billion in cash, as adjusted for $335 million of cash and cash equivalents held by Ellie Mae on the date of acquisition, and approximately $1.9 billion, or approximately 18.4 million shares of our common stock, based on our stock price on the acquisition date. ICE funded the cash portion of the purchase price with net proceeds from our offering of new senior notes in August 2020, together with the issuance of commercial paper and borrowings under a new senior unsecured term loan facility (Note 10). We have evaluated the impact of this acquisition and related disclosures under ASC 805- Business Combinations.The purchase price has been allocated to the net tangible and identifiable intangible assets and liabilities based on the respective estimated fair values on the date of acquisition, as determined with the assistance of a third-party valuation specialist. The excess of purchase price over the net tangible and identifiable intangible assets has been recorded as goodwill. Goodwill represents potential revenue synergies related to new product development, various expense synergies and opportunities to enter new markets. The purchase price allocation is as follows (in millions): | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | | | | Purchase Price Allocation | | Cash and cash equivalents | $ | 335 | | | Property and equipment | 125 | | | Goodwill | 7,731 | | | Identifiable intangibles | 4,442 | | | Other assets and liabilities, net | 48 | | | Deferred tax liabilities on identifiable intangibles | (1,253) | | | Total purchase price allocation | $ | 11,428 | | In performing the purchase price allocation, we considered, among other factors, the intended future use of acquired assets, analysis of historical financial performance and estimates of future performance of the Ellie Mae business.The following table sets forth the components of the intangible assets associated with the acquisition as of December 31, 2021 (in millions, except years): | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | Acquisition-Date Fair Value | | Accumulated Amortization | | Net Book Value | | Useful Life (Years) | | Customer relationships | $ | 3,136 | | | $ | (215) | | | $ | 2,921 | | | 10 to 20 | | Backlog | 300 | | | (79) | | | 221 | | | 5 | | Trademark/Tradenames | 200 | | | (14) | | | 186 | | | 5 to 20 | | Developed Technology | 739 | | | (147) | | | 592 | | | 7 | | In-process Research & Development | 67 | | | — | | | 67 | | | N/A | | Total | $ | 4,442 | | | $ | (455) | | | $ | 3,987 | | | | 103

string

Maximum Annual UAN Tons Eligible for Purchase

580,000

SEC-NUM

[Table of Contents](#i0302cc7c03c44d0c8270f104de834cdb_7)CF INDUSTRIES HOLDINGS, INC. CHS also receives deliveries pursuant to a supply agreement under which CHS has the right to purchase annually from CFN up to approximately 1.1 million tons of granular urea and 580,000 tons of UAN at market prices. As a result of its equity interest in CFN, CHS is entitled to semi-annual cash distributions from CFN. We are also entitled to semi-annual cash distributions from CFN. The amounts of distributions from CFN to us and CHS are based generally on the profitability of CFN and determined based on the volume of granular urea and UAN sold by CFN to us and CHS pursuant to supply agreements, less a formula driven amount based primarily on the cost of natural gas used to produce the granular urea and UAN, and adjusted for the allocation of items such as operational efficiencies and overhead amounts. Additionally, under the terms of the strategic venture, we recognized an embedded derivative related to our credit rating. See Note 9—Fair Value Measurements for additional information. 15. Stockholders’ EquityTreasury StockOn November 3, 2021, our Board of Directors (the Board) authorized the repurchase of up to $1.5 billion of CF Holdings common stock through December 31, 2024 (the 2021 Share Repurchase Program). Repurchases under the 2021 Share Repurchase Program may be made from time to time in the open market, through privately negotiated transactions, through block transactions or otherwise. The manner, timing and amount of repurchases will be determined by our management based on the evaluation of market conditions, stock price, and other factors. In the three months ended March 31, 2022, we repurchased approximately 1.3 million shares under the 2021 Share Repurchase Program for $100 million. In the three months ended March 31, 2022, we retired 27,962 shares of repurchased stock, including shares repurchased under the share repurchase program that expired on December 31, 2021. At March 31, 2022, we held 1,563,679 shares of treasury stock. Accumulated Other Comprehensive LossChanges to accumulated other comprehensive loss and the impact on other comprehensive income (loss) are as follows: | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ForeignCurrencyTranslationAdjustment | | | | UnrealizedGain onDerivatives | | DefinedBenefitPlans | | AccumulatedOtherComprehensiveIncome (Loss) | | | (in millions) | | Balance as of December 31, 2020 | $ | (144) | | | | | $ | 4 | | | $ | (180) | | | $ | (320) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Reclassification to earnings(1) | — | | | | | — | | | 2 | | | 2 | | | | | | | | | | | | | | Effect of exchange rate changes and deferred taxes | 14 | | | | | — | | | (1) | | | 13 | | | Balance as of March 31, 2021 | $ | (130) | | | | | $ | 4 | | | $ | (179) | | | $ | (305) | | | | | | | | | | | | | | Balance as of December 31, 2021 | $ | (141) | | | | | $ | 4 | | | $ | (120) | | | $ | (257) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Reclassification to earnings(1) | — | | | | | — | | | 1 | | | 1 | | | | | | | | | | | | | | Effect of exchange rate changes and deferred taxes | (13) | | | | | — | | | 3 | | | (10) | | | Balance as of March 31, 2022 | $ | (154) | | | | | $ | 4 | | | $ | (116) | | | $ | (266) | | \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(1)Reclassifications out of accumulated other comprehensive loss to the consolidated statements of operations during the three months ended March 31, 2022 and 2021 were not material. 19

string

Contribution to postretirement medical plans

11.1

SEC-NUM

| | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Nine Months Ended June 30 | | | Pension Benefits | | Other Benefits | | | 2022 | | 2021 | | 2022 | | 2021 | | | (In thousands) | | Components of net periodic pension cost: | | | | | | | | | Service cost | $ | 12,970 | | | $ | 13,834 | | | $ | 7,676 | | | $ | 12,917 | | | Interest cost (1) | 15,190 | | | 15,072 | | | 8,050 | | | 7,981 | | | Expected return on assets (1) | (22,149) | | | (20,934) | | | (9,937) | | | (7,841) | | | | | | | | | | | | Amortization of prior service cost (credit) (1) | (174) | | | (174) | | | (9,925) | | | 130 | | | Amortization of actuarial (gain) loss (1) | 5,853 | | | 9,405 | | | — | | | — | | | Settlements(1) | — | | | 8,999 | | | — | | | — | | | Net periodic pension cost | $ | 11,690 | | | $ | 26,202 | | | $ | (4,136) | | | $ | 13,187 | | (1) The components of net periodic cost other than the service cost component are included in the line item other non-operating expense in the condensed consolidated statements of comprehensive income or are capitalized on the condensed consolidated balance sheets as a regulatory asset or liability, as described in Note 2 to the consolidated financial statements in our Annual Report on Form 10-K for the fiscal year ended September 30, 2021. For the nine months ended June 30, 2022 we contributed $11.1 million to our postretirement medical plans. We anticipate contributing a total of between $15 million and $25 million to our postretirement plans during fiscal 2022. 10. Commitments and ContingenciesLitigation and Environmental MattersIn the normal course of business, we are subject to various legal and regulatory proceedings. For such matters, we record liabilities when they are considered probable and estimable, based on currently available facts, our historical experience and our estimates of the ultimate outcome or resolution of the liability in the future. While the outcome of these proceedings is uncertain and a loss in excess of the amount we have accrued is possible though not reasonably estimable, it is the opinion of management that any amounts exceeding the accruals will not have a material adverse impact on our financial position, results of operations or cash flows.We maintain liability insurance for various risks associated with the operation of our natural gas pipelines and facilities, including for property damage and bodily injury. These liability insurance policies generally require us to be responsible for the first $1.0 million (self-insured retention) of each incident. The National Transportation Safety Board (NTSB) held a public meeting on January 12, 2021 to determine the probable cause of the incident that occurred at a Dallas, Texas residence on February 23, 2018 that resulted in one fatality and injuries to four other residents. At the meeting, the Board deliberated and voted on proposed findings of fact, a probable cause statement, and safety recommendations. On February 8, 2021, the NTSB issued its final report that included an Executive Summary, Findings, Probable Cause, and Recommendations. Also on February 8, 2021, safety recommendations letters were distributed to recommendation recipients, including Atmos Energy. Atmos Energy timely provided a written response on May 7, 2021. Following the release of the NTSB’s final report, the Railroad Commission of Texas (RRC) completed its safety evaluation related to the same incident finding four alleged violations and initiated an enforcement proceeding to pursue administrative penalties totaling $1.6 million. Atmos Energy is working with the RRC to resolve the alleged violations and satisfy the administrative penalties.The NTSB is investigating a worksite accident that occurred in Farmersville, Texas on June 28, 2021 that resulted in two fatalities and injuries to two others. Together with the Railroad Commission of Texas and the Pipeline and Hazardous Materials Safety Administration, Atmos Energy is a party to the investigation and in that capacity is working closely with all parties to help determine the cause of this incident. Three civil actions have been filed in Dallas, Texas against Atmos Energy and one of its contractors in response to the accident.We are a party to various other litigation and environmental-related matters or claims that have arisen in the ordinary course of our business. While the results of such litigation and response actions to such environmental-related matters or claims cannot be predicted with certainty, we continue to believe the final outcome of such litigation and matters or claims will not have a material adverse effect on our financial condition, results of operations or cash flows.Purchase CommitmentsOur distribution divisions maintain supply contracts with several vendors that generally cover a period of up to one year. Commitments for estimated base gas volumes are established under these contracts on a monthly basis at contractually 20

string

Prior year claims and claims adjustment expense excluding effect of foreign currency

261

SEC-NUM

6. POLICY LIABILITIES Changes in the liability for unpaid policy claims were as follows: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months EndedJune 30, | | Six Months Ended June 30, | | | (In millions) | | 2022 | | 2021 | | | | 2022 | | 2021 | | | | Unpaid supplemental health claims, beginning of period | | $ | 4,009 | | | $ | 4,192 | | | | | $ | 4,067 | | | $ | 4,389 | | | | | Less reinsurance recoverables | | 40 | | | 37 | | | | | 37 | | | 39 | | | | | Net balance, beginning of period | | 3,969 | | | 4,155 | | | | | 4,030 | | | 4,350 | | | | | Add claims incurred during the period related to: | | | | | | | | | | | | | | Current year | | 1,583 | | | 1,710 | | | | | 3,322 | | | 3,570 | | | | | Prior years | | (155) | | | (198) | | | | | (365) | | | (518) | | | | | Total incurred | | 1,428 | | | 1,512 | | | | | 2,957 | | | 3,052 | | | | | Less claims paid during the period on claims incurred during: | | | | | | | | | | | | | | Current year | | 1,042 | | | 1,139 | | | | | 1,532 | | | 1,657 | | | | | Prior years | | 398 | | | 407 | | | | | 1,363 | | | 1,461 | | | | | Total paid | | 1,440 | | | 1,546 | | | | | 2,895 | | | 3,118 | | | | | Effect of foreign exchange rate changes on unpaid claims | | (216) | | | 4 | | | | | (351) | | | (159) | | | | | Net balance, end of period | | 3,741 | | | 4,125 | | | | | 3,741 | | | 4,125 | | | | | Add reinsurance recoverables | | 38 | | | 37 | | | | | 38 | | | 37 | | | | | Unpaid supplemental health claims, end of period | | 3,779 | | | 4,162 | | | | | 3,779 | | | 4,162 | | | | | Unpaid life claims, end of period | | 674 | | | 759 | | | | | 674 | | | 759 | | | | | Total liability for unpaid policy claims | | $ | 4,453 | | | $ | 4,921 | | | | | $ | 4,453 | | | $ | 4,921 | | | | The incurred claims development related to prior years reflects favorable claims experience compared to previous estimates. The favorable claims development of $365 million for the six-month period ended June 30, 2022 comprises approximately $220 million from Japan and $145 million from the U.S., representing approximately 60% and 40% of the total, respectively. Excluding the impact of foreign exchange of a loss of approximately $41 million from December 31, 2021 to June 30, 2022, the favorable claims development in Japan would have been approximately $261 million, representing approximately 72% of the total. The Company has experienced continued favorable claim trends in 2022 for its core health products in Japan. During the first six months of 2022, there were impacts from lower utilization of healthcare services, due to the COVID-19 pandemic. This impacted both cancer and medical products, as the Japan population was avoiding doctor and hospital visits and staying home more. This resulted in lower sickness, accident, and cancer incurred claims. Although overall experience is favorable, during the first six months of 2022, there has been an increase in medical hospitalization claims related to COVID-19, mainly due to at-home sickness benefits being utilized in Japan. In addition, dating back to before the pandemic, cancer treatment patterns in Japan are continuing to be influenced by significant advances in early-detection techniques and by the increased use of pathological diagnosis rather than clinical exams. Additionally, follow-up radiation and chemotherapy treatments are occurring more often on an outpatient basis. Such changes in treatment not only increase the quality of life and initial outcomes for the patients, but also decrease the average length of each hospital stay, resulting in favorable claims development. In the first six months of 2022, as experienced in 2021 and 2020, the incurred claims development related to prior years reflects favorable claims experience compared to previous estimates. The favorable claims trend continued for the majority of the Company's major U.S. accident and health lines of business, including accident, hospital indemnity, cancer, critical illness and short-term disability. Additionally, refinements to COVID-19 incurred estimates also contributed to the favorable development. The U.S. portion of the favorable claims development in the first six months of 2022 includes $54 million related to refinements in the estimates for COVID-19 and non-COVID-19 claims as experience emerges. 7. REINSURANCE The Company periodically enters into fixed quota-share coinsurance agreements with other companies in the normal course of business. For each of its reinsurance agreements, the Company determines whether the agreement provides indemnification against loss or liability relating to insurance risk in accordance with applicable accounting standards. 55

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Basis points reduction to return on equity, scenario two

45

SEC-NUM

Eversource, CL&P, NSTAR Electric and PSNH currently record revenues at the 10.57 percent base ROE and incentive cap at 11.74 percent established in the October 16, 2014 FERC order. A change of 10 basis points to the base ROE used to establish the reserves would impact Eversource’s after-tax earnings by an average of approximately $3 million for each of the four 15-month complaint periods. F. Eversource and NSTAR Electric Boston Harbor Civil ActionIn 2016, the United States Attorney on behalf of the United States Army Corps of Engineers filed a civil action in the United States District Court for the District of Massachusetts against NSTAR Electric, HEEC, and the Massachusetts Water Resources Authority (together with NSTAR Electric and HEEC, the "Defendants"). The action alleged that the Defendants failed to comply with certain permitting requirements related to the placement of the HEEC-owned electric distribution cable beneath Boston Harbor. The parties reached a settlement pursuant to which HEEC agreed to install a new 115kV distribution cable across Boston Harbor to Deer Island, utilizing a different route, and remove portions of the existing cable. Construction of the new distribution cable was completed in August 2019 and removal of the portions of the existing cable was completed in January 2020. All issues surrounding the current permit from the United States Army Corps of Engineers are expected to be resolved and remaining restoration efforts completed, at which time such litigation is expected to be dismissed with prejudice. G. CL&P Regulatory MattersCL&P Tropical Storm Isaias Response Investigation: In August 2020, PURA opened a docket to investigate the preparation for and response to Tropical Storm Isaias by Connecticut utilities, including CL&P. On April 28, 2021, PURA issued a final decision on CL&P’s compliance with its emergency response plan that concluded CL&P failed to comply with certain storm performance standards and was imprudent in certain instances. Specifically, PURA concluded that CL&P did not satisfy the performance standards for managing its municipal liaison program, timely removing electrical hazards from blocked roads, communicating critical information to its customers, or meeting its obligation to secure adequate external contractor and mutual aid resources in a timely manner. Based on its findings, PURA ordered CL&P to adjust its future rates in a pending or future rate proceeding to reflect a monetary penalty in the form of a downward adjustment of 90 basis points in its allowed rate of return on equity (ROE), which is currently 9.25 percent. In its decision, PURA explained that additional monetary penalties and further enforcement orders pursuant to Connecticut statute would be considered in a separate proceeding that was initiated on May 6, 2021. On May 6, 2021, as part of the penalty proceeding, PURA issued a notice of violation that included an assessment of $30 million, consisting of a $28.4 million civil penalty for non-compliance with storm performance standards to be provided as credits on customer bills and a $1.6 million fine for violations of accident reporting requirements to be paid to the State of Connecticut’s general fund. On July 14, 2021, PURA issued a final decision in this penalty proceeding that included an assessment of $28.6 million, maintaining the $28.4 million performance penalty and reducing the $1.6 million fine for accident reporting to $0.2 million. The $28.4 million performance penalty is currently being credited to customers on electric bills beginning on September 1, 2021 over a one-year period. The $28.4 million is the maximum statutory penalty amount under applicable Connecticut law in effect at the time of Tropical Storm Isaias, which is 2.5 percent of CL&P’s annual distribution revenues. The liability for the performance penalty was recorded as a current regulatory liability on CL&P’s balance sheet and as a reduction to Operating Revenues on the year ended December 31, 2021 statement of income. The after-tax earnings impact of this charge was $0.07 per share. CL&P Settlement Agreement: On October 1, 2021, CL&P entered into a settlement agreement with the DEEP, Office of Consumer Counsel (OCC), Office of the Attorney General (AG) and the Connecticut Industrial Energy Consumers, resolving certain issues that arose in then-pending regulatory proceedings initiated by the PURA. PURA approved the settlement agreement on October 27, 2021. In the settlement agreement, CL&P agreed to provide a total of $65 million of customer credits, which were distributed based on customer sales over a two-month billing period from December 1, 2021 to January 31, 2022. CL&P also agreed to irrevocably set aside $10 million to provide bill payment assistance to certain existing non-hardship and hardship customers carrying arrearages, as approved by the PURA, with the objective of disbursing the funds prior to April 30, 2022. CL&P recorded a current regulatory liability of $75 million on the balance sheet associated with the provisions of the settlement agreement, with a $65 million pre-tax charge as a reduction to Operating Revenues associated with the customer credits and a $10 million charge to Operations and Maintenance expense associated with the customer assistance fund on the year ended December 31, 2021 statement of income. In exchange for the $75 million of customer credits and assistance, PURA’s interim rate reduction docket was resolved without findings. As a result of the settlement agreement, neither the 90 basis point reduction to CL&P’s return on equity introduced in PURA’s storm-related decision issued April 28, 2021, nor the 45 basis point reduction to CL&P’s return on equity included in PURA’s decision issued September 14, 2021 in the interim rate reduction docket, will be implemented. CL&P has also agreed to freeze its current base distribution rates, subject to the customer credits described above, until no earlier than January 1, 2024. The rate freeze applies only to base distribution rates (including storm costs) and not to other rate mechanisms such as the retail rate components, rate reconciling mechanisms, formula rates and any other adjustment mechanisms. The rate freeze also does not apply to any cost recovery mechanism outside of the base distribution rates with regard to grid-modernization initiatives or any other proceedings, either currently pending or that may be initiated during the rate freeze period, that may place additional obligations on CL&P. The approval of the settlement agreement satisfies the Connecticut statute of rate review requirements that requires electric utilities to file a distribution rate case within four years of the last rate case. 125

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Forward Contract Indexed to Issuer's Equity, Interest Rate

6.875

SEC-NUM

22 | Notes to Condensed Consolidated Financial Statements—(Continued) | September 30, 2022 and 2021In conjunction with the issuance of the Equity Units, the Company received approximately $1 billion in proceeds, net of underwriting costs and commissions, before offering expenses. The proceeds for the issuance of 1,043,050 shares are attributed to the Series A Preferred Stock for $838 million and $205 million for the present value of the quarterly payments due to holders of the 2024 Purchase Contracts ("Contract Adjustment Payments"). The proceeds will be used for the development of the AES renewable businesses, U.S. utility businesses, LNG infrastructure, and for other developments determined by management.The Series A Preferred Stock will initially not bear any dividends and the liquidation preference of the convertible preferred stock will not accrete. The Series A Preferred Stock has no maturity date and will remain outstanding unless converted by holders or redeemed by the Company. Holders of the shares of the convertible preferred stock will have limited voting rights.The Series A Preferred Stock is pledged as collateral to support holders’ purchase obligations under the 2024 Purchase Contracts and can be remarketed. In connection with any successful remarketing, the Company may increase the dividend rate, increase the conversion rate, and modify the earliest redemption date for the convertible preferred stock. After any successful remarketing in connection with which the dividend rate on the convertible preferred stock is increased, the Company will pay cumulative dividends on the convertible preferred stock, if declared by the board of directors, quarterly in arrears from the applicable remarketing settlement date.Holders of Corporate Units may create Treasury Units or Cash Settled Units from their Corporate Units as provided in the Purchase Contract Agreement by substituting Treasury securities or cash, respectively, for the Convertible Preferred Stock comprising a part of the Corporate Units.The Company may not redeem the Series A Preferred Stock prior to March 22, 2024. At the election of the Company, on or after March 22, 2024, the Company may redeem for cash, all or any portion of the outstanding shares of the Series A Preferred Stock at a redemption price equal to 100% of the liquidation preference, plus any accumulated and unpaid dividends.The 2024 Purchase Contracts obligate the holders to purchase, on February 15, 2024, for a price of $100 in cash, a maximum number of 57,275,962 shares of the Company’s common stock (subject to customary anti-dilution adjustments). The 2024 Purchase Contract holders may elect to settle their obligation early, in cash. The Series A Preferred Stock is pledged as collateral to guarantee the holders’ obligations to purchase common stock under the terms of the 2024 Purchase Contracts. The initial settlement rate determining the number of shares that each holder must purchase will not exceed the maximum settlement rate and is determined over a market value averaging period preceding February 15, 2024. The initial maximum settlement rate of 3.864 was calculated using an initial reference price of $25.88, equal to the last reported sale price of the Company’s common stock on March 4, 2021. As of September 30, 2022, due to the customary anti-dilution provisions, the maximum settlement rate was 3.8680, equivalent to a reference price of $25.85. If the applicable market value of the Company’s common stock is less than or equal to the reference price, the settlement rate will be the maximum settlement rate; and if the applicable market value of common stock is greater than the reference price, the settlement rate will be a number of shares of the Company’s common stock equal to $100 divided by the applicable market value. Upon successful remarketing of the Series A Preferred Stock (“Remarketed Series A Preferred Stock”), the Company expects to receive additional cash proceeds of $1 billion and issue shares of Remarketed Series A Preferred Stock.The Company pays Contract Adjustment Payments to the holders of the 2024 Purchase Contracts at a rate of 6.875% per annum, payable quarterly in arrears on February 15, May 15, August 15, and November 15, commencing on May 15, 2021. The $205 million present value of the Contract Adjustment Payments at inception reduced the Series A Preferred Stock. As each quarterly Contract Adjustment Payment is made, the related liability is reduced and the difference between the cash payment and the present value will accrete to interest expense, approximately $5 million over the three-year term. As of September 30, 2022, the present value of the Contract Adjustment Payments was $106 million.The holders can settle the purchase contracts early, for cash, subject to certain exceptions and conditions in the prospectus supplement. Upon early settlement of any purchase contracts, the Company will deliver the number of shares of its common stock equal to 85% of the number of shares of common stock that would have otherwise been deliverable.Equity Transactions with Noncontrolling Interests

string

2024 (in shares)

123.3

SEC-NUM

[Table of](#i7d20a63dbc7f4057897188cf4f4b9871_7) [Contents](#i7d20a63dbc7f4057897188cf4f4b9871_7)interest rate, including issuance costs, of 0.08% and 0.99%, respectively. We use the net proceeds from the issuance of commercial paper for general corporate purposes.We also have a $10.0 billion unsecured revolving credit facility with a syndicate of lenders (the “Credit Agreement”), which was amended and restated in March 2022 to increase the borrowing capacity from $7.0 billion to $10.0 billion and to extend the term to March 2025. It may be extended for up to three additional one-year terms if approved by the lenders. The interest rate applicable to outstanding balances under the Credit Agreement is the applicable benchmark rate specified in the Credit Agreement plus 0.45%, with a commitment fee of 0.03% on the undrawn portion of the credit facility. There were no borrowings outstanding under the Credit Agreement as of December 31, 2021 and June 30, 2022.We also utilize other short-term credit facilities for working capital purposes. There were $318 million and $235 million of borrowings outstanding under these facilities as of December 31, 2021 and June 30, 2022, which were included in “Accrued expenses and other” on our consolidated balance sheets. In addition, we had $10.0 billion of unused letters of credit as of June 30, 2022. Note 6 — STOCKHOLDERS’ EQUITYStock Repurchase ActivityIn March 2022, the Board of Directors authorized a program to repurchase up to $10.0 billion of our common stock, with no fixed expiration, which replaced the previous $5.0 billion stock repurchase authorization, approved by the Board of Directors in February 2016. We repurchased 46.2 million shares of our common stock for $6.0 billion during the six months ended June 30, 2022 under these programs. As of June 30, 2022, we have $6.1 billion remaining under the repurchase program.Stock Award ActivityCommon shares outstanding plus shares underlying outstanding stock awards totaled 10.5 billion and 10.6 billion as of December 31, 2021 and June 30, 2022. These totals include all vested and unvested stock awards outstanding, including those awards we estimate will be forfeited. Stock-based compensation expense is as follows (in millions): | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months EndedJune 30, | | Six Months EndedJune 30, | | | 2021 | | 2022 | | 2021 | | 2022 | | Cost of sales | $ | 145 | | | $ | 213 | | | $ | 235 | | | $ | 359 | | | Fulfillment | 566 | | | 763 | | | 908 | | | 1,261 | | | Technology and content | 1,887 | | | 2,814 | | | 3,115 | | | 4,459 | | | Sales and marketing | 691 | | | 990 | | | 1,147 | | | 1,655 | | | General and administrative | 302 | | | 429 | | | 492 | | | 725 | | | Total stock-based compensation expense | $ | 3,591 | | | $ | 5,209 | | | $ | 5,897 | | | $ | 8,459 | | The following table summarizes our restricted stock unit activity for the six months ended June 30, 2022 (in millions): | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | Number of Units | | Weighted-AverageGrant-DateFair Value | | Outstanding as of December 31, 2021 | 279.9 | | | $ | 134 | | | Units granted | 166.0 | | | 159 | | | Units vested | (54.2) | | | 108 | | | Units forfeited | (24.2) | | | 140 | | | Outstanding as of June 30, 2022 | 367.5 | | | 149 | | Scheduled vesting for outstanding restricted stock units as of June 30, 2022, is as follows (in millions): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Six Months Ended December 31, | | Year Ended December 31, | | | | | | | 2022 | | 2023 | | 2024 | | 2025 | | 2026 | | Thereafter | | Total | | Scheduled vesting — restricted stock units | 57.7 | | | 134.5 | | | 123.3 | | | 38.0 | | | 9.8 | | | 4.2 | | | 367.5 | | As of June 30, 2022, there was $26.9 billion of net unrecognized compensation cost related to unvested stock-based compensation arrangements. This compensation is recognized on an accelerated basis with approximately half of the compensation expected to be expensed in the next twelve months, and has a remaining weighted-average recognition period of 16

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Number of real estate properties subject to ownership from noncontrolling interest

63

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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Number of shares issued in transaction

30.8

SEC-NUM

[Table of Contents](#ia72a687f7b8a4bb1b43219ab5b663314_7)NOTE 3. DISCONTINUED OPERATIONS Fortive Corporation SeparationOn July 2, 2016, the Company completed the separation of its former Test & Measurement segment, Industrial Technologies segment (excluding the product identification businesses) and retail/commercial petroleum business by distributing to Danaher stockholders on a pro rata basis all of the issued and outstanding common stock of Fortive Corporation (“Fortive”), the entity the Company incorporated to hold such businesses. For the year ended December 31, 2021, the Company recorded an income tax benefit of $86 million related to the release of previously provided reserves associated with uncertain tax positions on certain of the Company’s tax returns which were jointly filed with Fortive entities. These reserves were released due to the expiration of statutes of limitations for those returns. This income tax benefit is included in earnings from discontinued operations, net of income taxes in the accompanying Consolidated Statements of Earnings. Envista Holdings Corporation DispositionOn September 20, 2019, Envista Holdings Corporation (“Envista”), completed an initial public offering (“IPO”) of 30.8 million shares of its common stock, which represented 19.4% of Envista’s outstanding shares at the time of the offering, at a public offering price of $22.00 per share. Envista realized net proceeds of $643 million from the IPO, after deducting underwriting discounts and deal expenses.In connection with the completion of the IPO, through a series of equity and other transactions, the Company transferred its dental businesses to Envista (the “Separation”). In exchange, Envista transferred consideration of approximately $2.0 billion to the Company, which consists primarily of the net proceeds from the IPO and approximately $1.3 billion of proceeds from Envista’s term debt financing. The excess of the net book value of the business transferred to Envista over the net proceeds from the IPO was $60 million and was recorded as a reduction to additional paid-in capital in the accompanying Consolidated Balance Sheet. On December 18, 2019, Danaher completed the disposition of the remaining 80.6% ownership of Envista common stock through a split-off exchange offer, which resulted in Danaher’s repurchase of 22.9 million shares of the Company’s common stock in exchange for the remaining shares of Envista held by Danaher (the “Split-Off”). The IPO, Separation and Split-Off are collectively referred to as the “Envista Disposition”. As a result, the Company recognized a gain on the disposition of $451 million in the fourth quarter of 2019. At the time of the disposition, the Company reclassified $109 million of foreign currency translation adjustment losses related to Envista from accumulated other comprehensive income (loss) to the Company’s results of discontinued operations as a component of the net gain on the Envista Disposition. As a result of the IPO, Danaher recorded an increase to noncontrolling interest of $689 million in 2019 for the sale of the Envista common stock and subsequent earnings and other comprehensive income (loss) attributable to the noncontrolling interest. At the time of the Envista Disposition, Danaher decreased noncontrolling interests by $692 million to record the deconsolidation of Envista and the elimination of the noncontrolling interest.The accounting requirements for reporting Envista as a discontinued operation were met when the Split-Off was completed. Accordingly, the Consolidated Financial Statements for all periods presented reflect this business as a discontinued operation. The Company allocated a portion of the consolidated interest expense to discontinued operations based on the ratio of the discontinued business’ net assets to the Company’s consolidated net assets. Envista had revenues of approximately $2.6 billion in 2019 prior to the exchange offer. As a result of the Envista Disposition, the Company incurred $69 million in IPO and Separation-related costs during the year ended December 31, 2019, which are reflected in earnings from discontinued operations, net of income taxes in the accompanying Consolidated Statements of Earnings. These costs primarily relate to professional fees associated with preparation of regulatory filings and activities within finance, tax, legal and information technology functions as well as certain investment banking fees and tax costs.Danaher used a portion of the consideration received from Envista to redeem $875 million in aggregate principal amount of outstanding indebtedness in the fourth quarter of 2019 (consisting of the Company’s 2.4% senior unsecured notes due 2020 and 5.0% senior unsecured notes due 2020). The Company incurred make-whole premiums in connection with the redemption of $7 million ($5 million after-tax). The Company used the balance of the consideration it received from Envista to redeem commercial paper borrowings as they matured. In connection with the Envista IPO and Separation, Danaher and Envista entered into various agreements to effect the disposition and provide a framework for their relationship after the Envista Separation, including a separation agreement, transition services agreement, employee matters agreement, tax matters agreement, intellectual property matters agreement and DANAHER BUSINESS SYSTEM (“DBS”) license agreement. These agreements provide for the allocation between Danaher and Envista of assets, employees, liabilities and obligations (including investments, property and employee benefits and tax-76

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Minimum percentage of aggregate debit items arising from broker-dealer client balances

2

SEC-NUM

GAAP. Prescribed statutory accounting practices include publications of the NAIC, as well as state laws, regulations and general administrative rules. The more significant differences from GAAP include charging policy acquisition costs to expense as incurred, establishing annuity and insurance reserves using different actuarial methods and assumptions, valuing investments on a different basis and excluding certain assets from the balance sheet by charging them directly to surplus, such as a portion of the net deferred income tax assets.RiverSource Life received approval from the Minnesota Department of Commerce to apply a permitted statutory accounting practice, effective July 1, 2017 through June 30, 2019, for certain derivative instruments used to economically hedge the interest rate exposure of certain variable annuity products that do not qualify for statutory hedge accounting. The permitted practice was intended to mitigate the impact to statutory surplus from the misalignment between variable annuity statutory reserves, which are not carried at fair value, and the fair value of derivatives used to economically hedge the interest rate exposure of non-life contingent living benefit guarantees. The permitted practice allowed RiverSource Life to defer a portion of the change in fair value, net investment income and realized gains or losses generated from designated derivatives to the extent the amounts do not offset the current period interest-rate related change in the variable annuity statutory reserve liability. The deferred amount could be amortized over ten years using the straight-line method with the ability to accelerate amortization at management’s discretion. As of June 30, 2019, RiverSource Life elected to accelerate amortization of the net deferred amount associated with its permitted practice.State insurance statutes contain limitations as to the amount of dividends that insurers may make without providing prior notification to state regulators. For RiverSource Life, payments in excess of unassigned surplus, as determined in accordance with accounting practices prescribed by the State of Minnesota, require advance notice to the Minnesota Department of Commerce, RiverSource Life’s primary regulator, and are subject to potential disapproval. RiverSource Life’s statutory unassigned surplus aggregated $175 million and $1.3 billion as of December 31, 2021 and 2020, respectively. In addition, dividends whose fair market value, together with that of other dividends made within the preceding 12 months, exceed the greater of the previous year’s statutory net gain from operations or 10% of the previous year-end statutory capital and surplus are referred to as “extraordinary dividends.” Extraordinary dividends also require advance notice to the Minnesota Department of Commerce, and are subject to potential disapproval. Statutory capital and surplus for RiverSource Life was $3.4 billion and $4.8 billion as of December 31, 2021 and 2020, respectively. On February 23, 2022, RiverSource Life’s Board of Directors declared a cash dividend of $300 million to Ameriprise Financial, Inc., payable on or after March 25, 2022, pending approval by the Minnesota Department of Commerce.Statutory net gain from operations and net income are summarized as follows: | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | Years Ended December 31, | | 2021 | | 2020 | | 2019 | | (in millions) | | RiverSource Life | | | | | | | Statutory net gain from operations | $ | 1,366 | | | $ | 1,393 | | | $ | 1,505 | | | Statutory net income | 253 | | | 1,582 | | | 786 | | Government debt securities of $5 million and $4 million as of December 31, 2021 and 2020, respectively, held by the Company’s life insurance subsidiaries were on deposit with various states as required by law. Broker-dealer subsidiariesThe Company’s broker-dealer subsidiaries are subject to the Uniform Net Capital Rule (Rule 15c3-1) under the Securities Exchange Act of 1934. Rule 15c3-1 provides an “alternative net capital requirement” which American Enterprise Investment Services, Inc. (“AEIS”) and Ameriprise Financial Services, LLC (“AFS”) (significant broker dealers) have elected. Regulations require that minimum net capital, as defined, be equal to the greater of $250 thousand or 2% of aggregate debit items arising from client balances. FINRA may impose certain restrictions, such as restricting withdrawals of equity capital, if a member firm were to fall below a certain threshold or fail to meet minimum net capital requirements. 138

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Number of law suits filed

1,000

SEC-NUM

OtherAs previously disclosed, in 2008 we recalled our heparin sodium injection products in the United States. Following the recall, more than 1,000 lawsuits alleging that plaintiffs suffered various reactions to a heparin contaminant, in some cases resulting in fatalities, were filed. In January 2019, the last of these cases was settled. In 2019, following the resolution of an insurance dispute, we received cash proceeds of $39 million for our allocation of the insurance proceeds under a settlement and cost-sharing agreement related to the defense of the heparin product liability cases. We recognized a $37 million gain in connection with the resolution of the dispute with the insurer that is classified within other operating income, net on the consolidated statement of income for the year ended December 31, 2019.In September 2017, Hurricane Maria caused damage to certain of our assets in Puerto Rico and disrupted operations. In 2019, we recognized $100 million of insurance recoveries related to the losses from the hurricane, which are classified within other operating income, net on the consolidated statement of income. NOTE 8 | | | | | --- | --- | --- | | | | | | STOCKHOLDERS’ EQUITY | Stock-Based CompensationOur stock-based compensation generally includes stock options, restricted stock units (RSUs), performance share units (PSUs) and purchases under our employee stock purchase plan. Shares issued relating to our stock-based plans are generally issued out of treasury stock.As of December 31, 2021, approximately 51 million authorized shares are available for future awards under our stock-based compensation plans.Stock Compensation ExpenseStock compensation expense was $146 million, $130 million and $122 million in 2021, 2020 and 2019, respectively. The related tax benefit recognized was $36 million in 2021, $53 million in 2020 and $70 million in 2019. Included in the benefit in 2021, 2020 and 2019 were realized excess tax benefits for stock-based compensation of $13 million, $27 million and $54 million, respectively.Stock compensation expense is recorded at the corporate level and is not allocated to the segments. Approximately 75% of stock compensation expense is classified in SG&A expenses, with the remainder classified in cost of sales and R&D expenses. Costs capitalized in the consolidated balance sheets at December 31, 2021 and 2020 were not material.Stock compensation expense is based on awards expected to vest, and therefore has been reduced by estimated forfeitures.Stock OptionsStock options are granted to employees and non-employee directors with exercise prices equal to 100% of the market value on the date of grant. Stock options granted to employees generally vest in one-third increments over a three-year period. Stock options granted to non-employee directors generally vest immediately on the grant date and are issued with a six-month claw-back provision. Stock options typically have a contractual term of 10 years. The grant-date fair value, adjusted for estimated forfeitures, is recognized as expense on a straight-line basis over the substantive vesting period.The fair value of stock options is determined using the Black-Scholes model. The weighted-average assumptions used in estimating the fair value of stock options granted during each year, along with the weighted-average grant-77

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Total cash consideration

891

SEC-NUM

[Table of Contents](#i329aa562213e420593df15cade55885b_7) The preliminary allocation of the purchase price is as follows: | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | (In millions) | | August 1, 2022 | | Cash and cash equivalents | | $ | 462 | | | Accounts receivable | | 393 | | | Inventories | | 373 | | | Other assets, current | | 74 | | | Fixed assets | | 294 | | | Intangible assets | | 965 | | | Goodwill | | 866 | | | Other assets | | 287 | | | Accounts payable | | (412) | | | Accrued liabilities | | (445) | | | Contract liabilities, current | | (21) | | | Other long-term liabilities | | (496) | | | Net assets acquired | | $ | 2,340 | | | Less: Fair value of non-controlling interests | | (22) | | | Less: Fair value of previously held TCC equity investments | | (1,427) | | | Total cash consideration | | $ | 891 | | The excess purchase price over the estimated fair value of the net assets acquired was recognized as goodwill and totaled $866 million, which is not deductible for tax purposes. Accounts receivable and current liabilities were stated at their historical carrying value, which approximates fair value given the short-term nature of these assets and liabilities. The estimate of fair value for inventory and fixed assets was based on an assessment of the acquired assets' condition as well as an evaluation of the current market value of such assets. The Company recorded intangible assets based on its preliminary estimate of fair value which consisted of the following: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | (In millions) | Estimated Useful Life (in years) | | Intangible Assets Acquired | | Customer relationships | 23 | | $ | 497 | | | Technology | 7 | | 220 | | | Trademark | 26 | | 180 | | | Backlog | 1 | | 60 | | | Land use rights | 45 | | 8 | | | Total intangible assets acquired | | | $ | 965 | | The valuation of intangible assets was determined using an income approach methodology including the multi-period excess earnings method and the relief from royalty method. Key assumptions used in estimating future cash flows included projected revenue growth rates, profit margins, discount rates, customer attrition rates and royalty rates among others. The projected future cash flows are discounted to present value using an appropriate discount rate. As of September 30, 2022, the Company has not finalized the process of allocating TCC's purchase price and valuing the acquired assets and liabilities. The Company previously accounted for its minority ownership in TCC under the equity method of accounting. In connection with the transaction, the carrying value of the Company's previously held TCC equity investments were recognized at fair value at the date of acquisition using an income approach methodology. As a result, the Company recognized a $732 million non-cash gain within Other income (expense), net on the accompanying Unaudited Condensed Consolidated Statement of Operations. In addition, the assets, liabilities and results of operations of TCC are consolidated in the accompanying Unaudited Condensed Consolidated Financial Statements as of the date of acquisition and reported within the Company's HVAC segment. During the 22

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Finite-Lived Intangible Asset, Expected Amortization, Year Four

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5. Goodwill and Intangible AssetsGoodwillThe following table shows the changes in the carrying amount of goodwill: | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | (Millions) | Meals & Beverages | | Snacks | | Total | | Net balance at August 2, 2020 | $ | 975 | | | $ | 3,011 | | | $ | 3,986 | | | | | | | | | | Divestiture(1) | (12) | | | — | | | (12) | | | | | | | | | | | | | | | | | Foreign currency translation adjustment | 7 | | | — | | | 7 | | | Net balance at August 1, 2021 | $ | 970 | | | $ | 3,011 | | | $ | 3,981 | | | Amounts reclassified due to segment change(2) | 25 | | | (25) | | | — | | | | | | | | | | | | | | | | | Foreign currency translation adjustment | (2) | | | — | | | (2) | | | Net balance at July 31, 2022 | $ | 993 | | | $ | 2,986 | | | $ | 3,979 | | \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(1)See Note 3 for additional information on the sale of the Plum baby and snack foods business.(2)See Note 6 for additional information.Intangible AssetsThe following table summarizes balance sheet information for intangible assets, excluding goodwill: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 2022 | | 2021 | | (Millions) | | Cost | | Accumulated Amortization | | Net | | Cost | | Accumulated Amortization | | Net | | Amortizable intangible assets | | | | | | | | | | | | | | Customer relationships | | $ | 830 | | | $ | (181) | | | $ | 649 | | | $ | 830 | | | $ | (140) | | | $ | 690 | | | Non-amortizable intangible assets | | | | | | | | | | | | | | Trademarks | | | | | | 2,549 | | | | | | | 2,549 | | | Total net intangible assets | | | | | | $ | 3,198 | | | | | | | $ | 3,239 | | Amortization of intangible assets in Earnings from continuing operations was $41 million for 2022, $42 million for 2021 and $43 million for 2020. As of July 31, 2022, amortizable intangible assets had a weighted-average remaining useful life of 16 years. Amortization expense for the next five years is estimated to be approximately $41 million per year.The carrying values of indefinite-lived trademarks as of July 31, 2022 and August 1, 2021, are detailed below: | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | (Millions) | | | | Snyder's of Hanover | | $ | 620 | | | Lance | | 350 | | | Kettle Brand | | 318 | | | Pace | | 292 | | | Pacific Foods | | 280 | | | Various other Snacks(1) | | 689 | | | Total | | $ | 2,549 | | \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_(1)Associated with the acquisition of Snyder's-Lance, Inc. (Snyder's-Lance).As of the 2022 impairment testing, indefinite-lived trademarks with 10% or less of excess coverage of fair value over carrying value had an aggregate carrying value of $434 million and included Pacific Foods and certain other Snacks trademarks.The estimates of future cash flows used in determining the fair value of goodwill and intangible assets involve significant management judgment and are based upon assumptions about expected future operating performance, economic conditions, market conditions and cost of capital. Inherent in estimating the future cash flows are uncertainties beyond our control, such as changes in capital markets. The actual cash flows could differ materially from management’s estimates due to changes in business conditions, operating performance and economic conditions.47

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Long-Term Debt, Maturity, Year Four

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[Table of Contents](#i96cbbb599c964cb4a125b720672b6568_10)Debt at December 31 consisted of the following: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 2021 | | 2020 | | Unsecured debt | | | | | Variable rate: Eurodollar plus 0.75% - 1.25% due 2022 | | | $13,819 | | | 1.17% - 2.50% due through 2026 | $12,404 | | | 3,656 | | | 2.60% - 3.20% due through 2030 | 7,001 | | | 6,989 | | | 3.25% - 3.90% due through 2059 | 9,570 | | | 9,555 | | | 3.95% - 5.15% due through 2059 | 13,993 | | | 13,917 | | | 5.71% - 6.63% due through 2060 | 13,008 | | | 13,005 | | | 6.88% - 8.75% due through 2043 | 1,853 | | | 2,252 | | | | | | | | | | | | | | | | | | Other debt and notes | | | | | Finance lease obligations due through 2044 | 180 | | | 203 | | | Other notes | 93 | | | 187 | | | Total debt | $58,102 | | | $63,583 | | Total debt at December 31 is attributable to: | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | 2021 | | 2020 | | BCC | $1,525 | | | $1,640 | | | Other Boeing | 56,577 | | | 61,943 | | | Total debt | $58,102 | | | $63,583 | | Scheduled principal payments for debt and minimum finance lease obligations for the next five years are as follows: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 2022 | | 2023 | | 2024 | | 2025 | | 2026 | | | | | | | | | | | | | | | | | | | | | | | | Debt | $1,236 | | | $5,101 | | | $5,066 | | | $4,302 | | | $7,952 | | | Minimum finance lease obligations | $64 | | | $43 | | | $25 | | | $14 | | | $6 | | Note 16 – Postretirement PlansMany of our employees have earned benefits under defined benefit pension plans. Nonunion and the majority of union employees that had participated in defined benefit pension plans transitioned to a company-funded defined contribution retirement savings plan in 2016. Additional union employees transitioned to company-funded defined contribution retirement savings plans effective January 1, 2019.We fund our major pension plans through trusts. Pension assets are placed in trust solely for the benefit of the plans’ participants and are structured to maintain liquidity that is sufficient to pay benefit obligations as well as to keep pace over the long-term with the growth of obligations for future benefit payments.We also have other postretirement benefits (OPB) other than pensions which consist principally of health care coverage for eligible retirees and qualifying dependents, and to a lesser extent, life insurance to certain groups of retirees. Retiree health care is provided principally until age 65 for approximately three-fourths of those participants who are eligible for health care coverage. Certain employee groups, including employees covered by most United Auto Workers bargaining agreements, are provided lifetime health care coverage. The funded status of the plans is measured as the 99

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