note 12 2013 stock-based compensation during 2013 , 2012 , and 2011 , we recorded non-cash stock-based compensation expense totaling $ 189 million , $ 167 million , and $ 157 million , which is included as a component of other unallocated costs on our statements of earnings .
the net impact to earnings for the respective years was $ 122 million , $ 108 million , and $ 101 million .
as of december 31 , 2013 , we had $ 132 million of unrecognized compensation cost related to nonvested awards , which is expected to be recognized over a weighted average period of 1.5 years .
we received cash from the exercise of stock options totaling $ 827 million , $ 440 million , and $ 116 million during 2013 , 2012 , and 2011 .
in addition , our income tax liabilities for 2013 , 2012 , and 2011 were reduced by $ 158 million , $ 96 million , and $ 56 million due to recognized tax benefits on stock-based compensation arrangements .
stock-based compensation plans under plans approved by our stockholders , we are authorized to grant key employees stock-based incentive awards , including options to purchase common stock , stock appreciation rights , restricted stock units ( rsus ) , performance stock units ( psus ) , or other stock units .
the exercise price of options to purchase common stock may not be less than the fair market value of our stock on the date of grant .
no award of stock options may become fully vested prior to the third anniversary of the grant , and no portion of a stock option grant may become vested in less than one year .
the minimum vesting period for restricted stock or stock units payable in stock is three years .
award agreements may provide for shorter or pro-rated vesting periods or vesting following termination of employment in the case of death , disability , divestiture , retirement , change of control , or layoff .
the maximum term of a stock option or any other award is 10 years .
at december 31 , 2013 , inclusive of the shares reserved for outstanding stock options , rsus and psus , we had 20.4 million shares reserved for issuance under the plans .
at december 31 , 2013 , 4.7 million of the shares reserved for issuance remained available for grant under our stock-based compensation plans .
we issue new shares upon the exercise of stock options or when restrictions on rsus and psus have been satisfied .
the following table summarizes activity related to nonvested rsus during 2013 : number of rsus ( in thousands ) weighted average grant-date fair value per share .

                              | number of rsus ( in thousands ) | weighted average grant-date fair value pershare
----------------------------- | ------------------------------- | -----------------------------------------------
nonvested at december 31 2012 | 4822                            | $ 79.10
granted                       | 1356                            | 89.24
vested                        | -2093 ( 2093 )                  | 79.26
forfeited                     | -226 ( 226 )                    | 81.74
nonvested at december 31 2013 | 3859                            | $ 82.42

rsus are valued based on the fair value of our common stock on the date of grant .
employees who are granted rsus receive the right to receive shares of stock after completion of the vesting period , however , the shares are not issued , and the employees cannot sell or transfer shares prior to vesting and have no voting rights until the rsus vest , generally three years from the date of the award .
employees who are granted rsus receive dividend-equivalent cash payments only upon vesting .
for these rsu awards , the grant-date fair value is equal to the closing market price of our common stock on the date of grant less a discount to reflect the delay in payment of dividend-equivalent cash payments .
we recognize the grant-date fair value of rsus , less estimated forfeitures , as compensation expense ratably over the requisite service period , which beginning with the rsus granted in 2013 is shorter than the vesting period if the employee is retirement eligible on the date of grant or will become retirement eligible before the end of the vesting period .
stock options we generally recognize compensation cost for stock options ratably over the three-year vesting period .
at december 31 , 2013 and 2012 , there were 10.2 million ( weighted average exercise price of $ 83.65 ) and 20.6 million ( weighted average exercise price of $ 83.15 ) stock options outstanding .
stock options outstanding at december 31 , 2013 have a weighted average remaining contractual life of approximately five years and an aggregate intrinsic value of $ 663 million , and we expect nearly all of these stock options to vest .
of the stock options outstanding , 7.7 million ( weighted average exercise price of $ 84.37 ) have vested as of december 31 , 2013 and those stock options have a weighted average remaining contractual life of approximately four years and an aggregate intrinsic value of $ 497 million .
there were 10.1 million ( weighted average exercise price of $ 82.72 ) stock options exercised during 2013 .
we did not grant stock options to employees during 2013.


the following table shows the impact of catastrophe losses and related reinstatement premiums and the impact of prior period development on our consolidated loss and loss expense ratio for the periods indicated. .

                                                      | 2010             | 2009             | 2008
----------------------------------------------------- | ---------------- | ---------------- | ----------------
loss and loss expense ratio as reported               | 59.2% ( 59.2 % ) | 58.8% ( 58.8 % ) | 60.6% ( 60.6 % )
catastrophe losses and related reinstatement premiums | ( 3.2 ) % (  % ) | ( 1.2 ) % (  % ) | ( 4.7 ) % (  % )
prior period development                              | 4.6% ( 4.6 % )   | 4.9% ( 4.9 % )   | 6.8% ( 6.8 % )
large assumed loss portfolio transfers                | ( 0.3 ) % (  % ) | ( 0.8 ) % (  % ) | 0.0% ( 0.0 % )
loss and loss expense ratio adjusted                  | 60.3% ( 60.3 % ) | 61.7% ( 61.7 % ) | 62.7% ( 62.7 % )

we recorded net pre-tax catastrophe losses of $ 366 million in 2010 compared with net pre-tax catastrophe losses of $ 137 million and $ 567 million in 2009 and 2008 , respectively .
the catastrophe losses for 2010 were primarily related to weather- related events in the u.s. , earthquakes in chile , mexico , and new zealand , and storms in australia and europe .
the catastrophe losses for 2009 were primarily related to an earthquake in asia , floods in europe , several weather-related events in the u.s. , and a european windstorm .
for 2008 , the catastrophe losses were primarily related to hurricanes gustav and ike .
prior period development arises from changes to loss estimates recognized in the current year that relate to loss reserves first reported in previous calendar years and excludes the effect of losses from the development of earned premium from pre- vious accident years .
we experienced $ 503 million of net favorable prior period development in our p&c segments in 2010 .
this compares with net favorable prior period development in our p&c segments of $ 576 million and $ 814 million in 2009 and 2008 , respectively .
refer to 201cprior period development 201d for more information .
the adjusted loss and loss expense ratio declined in 2010 , compared with 2009 , primarily due to the impact of the crop settlements , non-recurring premium adjustment and the reduction in assumed loss portfolio business , which is written at higher loss ratios than other types of business .
our policy acquisition costs include commissions , premium taxes , underwriting , and other costs that vary with , and are primarily related to , the production of premium .
administrative expenses include all other operating costs .
our policy acquis- ition cost ratio increased in 2010 , compared with 2009 .
the increase was primarily related to the impact of crop settlements , which generated higher profit-share commissions and a lower adjustment to net premiums earned , as well as the impact of reinstatement premiums expensed in connection with catastrophe activity and changes in business mix .
our administrative expense ratio increased in 2010 , primarily due to the impact of the crop settlements , reinstatement premiums expensed , and increased costs in our international operations .
although the crop settlements generate minimal administrative expenses , they resulted in lower adjustment to net premiums earned in 2010 , compared with 2009 .
administrative expenses in 2010 , were partially offset by higher net results generated by our third party claims administration business , esis , the results of which are included within our administrative expenses .
esis generated $ 85 million in net results in 2010 , compared with $ 26 million in 2009 .
the increase is primarily from non-recurring sources .
our policy acquisition cost ratio was stable in 2009 , compared with 2008 , as increases in our combined insurance operations were offset by more favorable final crop year settlement of profit share commissions .
administrative expenses increased in 2009 , primarily due to the inclusion of administrative expenses related to combined insurance for the full year and costs associated with new product expansion in our domestic retail operation and in our personal lines business .
our effective income tax rate , which we calculate as income tax expense divided by income before income tax , is depend- ent upon the mix of earnings from different jurisdictions with various tax rates .
a change in the geographic mix of earnings would change the effective income tax rate .
our effective income tax rate was 15 percent in 2010 , compared with 17 percent and 24 percent in 2009 and 2008 , respectively .
the decrease in our effective income tax rate in 2010 , was primarily due to a change in the mix of earnings to lower tax-paying jurisdictions , a decrease in the amount of unrecognized tax benefits which was the result of a settlement with the u.s .
internal revenue service appeals division regarding federal tax returns for the years 2002-2004 , and the recognition of a non-taxable gain related to the acquisition of rain and hail .
the 2009 year included a reduction of a deferred tax valuation allowance related to investments .
for 2008 , our effective income tax rate was adversely impacted by a change in mix of earnings due to the impact of catastrophe losses in lower tax-paying jurisdictions .
prior period development the favorable prior period development , inclusive of the life segment , of $ 512 million during 2010 was the net result of sev- eral underlying favorable and adverse movements .
with respect to ace 2019s crop business , ace regularly receives reports from its managing general agent ( mga ) relating to the previous crop year ( s ) in subsequent calendar quarters and this typically results


table of contents part ii item 5 .
market for registrant 2019s common equity , related stockholder matters and issuer purchases of equity securities .
price range our common stock trades on the nasdaq global select market under the symbol 201cmktx 201d .
the range of closing price information for our common stock , as reported by nasdaq , was as follows : on february 20 , 2013 , the last reported closing price of our common stock on the nasdaq global select market was $ 39.60 .
holders there were 33 holders of record of our common stock as of february 20 , 2013 .
dividend policy we initiated a regular quarterly dividend in the fourth quarter of 2009 .
during 2012 and 2011 , we paid quarterly cash dividends of $ 0.11 per share and $ 0.09 per share , respectively .
on december 27 , 2012 , we paid a special dividend of $ 1.30 per share .
in january 2013 , our board of directors approved a quarterly cash dividend of $ 0.13 per share payable on february 28 , 2013 to stockholders of record as of the close of business on february 14 , 2013 .
any future declaration and payment of dividends will be at the sole discretion of our board of directors .
the board of directors may take into account such matters as general business conditions , our financial results , capital requirements , and contractual , legal , and regulatory restrictions on the payment of dividends to our stockholders or by our subsidiaries to the parent and any other such factors as the board of directors may deem relevant .
recent sales of unregistered securities securities authorized for issuance under equity compensation plans please see the section entitled 201cequity compensation plan information 201d in item 12. .

2012:                              | high    | low
---------------------------------- | ------- | -------
january 1 2012 to march 31 2012    | $ 37.79 | $ 29.26
april 1 2012 to june 30 2012       | $ 37.65 | $ 26.22
july 1 2012 to september 30 2012   | $ 34.00 | $ 26.88
october 1 2012 to december 31 2012 | $ 35.30 | $ 29.00
2011:                              | high    | low
january 1 2011 to march 31 2011    | $ 24.19 | $ 19.78
april 1 2011 to june 30 2011       | $ 25.22 | $ 21.00
july 1 2011 to september 30 2011   | $ 30.75 | $ 23.41
october 1 2011 to december 31 2011 | $ 31.16 | $ 24.57


item 7 .
management 2019s discussion and analysis of financial condition and results of operations we are an international energy company with operations in the u.s. , canada , africa , the middle east and europe .
our operations are organized into three reportable segments : 2022 e&p which explores for , produces and markets liquid hydrocarbons and natural gas on a worldwide basis .
2022 osm which mines , extracts and transports bitumen from oil sands deposits in alberta , canada , and upgrades the bitumen to produce and market synthetic crude oil and vacuum gas oil .
2022 ig which produces and markets products manufactured from natural gas , such as lng and methanol , in e.g .
certain sections of management 2019s discussion and analysis of financial condition and results of operations include forward- looking statements concerning trends or events potentially affecting our business .
these statements typically contain words such as "anticipates" "believes" "estimates" "expects" "targets" "plans" "projects" "could" "may" "should" "would" or similar words indicating that future outcomes are uncertain .
in accordance with "safe harbor" provisions of the private securities litigation reform act of 1995 , these statements are accompanied by cautionary language identifying important factors , though not necessarily all such factors , which could cause future outcomes to differ materially from those set forth in forward-looking statements .
for additional risk factors affecting our business , see item 1a .
risk factors in this annual report on form 10-k .
management 2019s discussion and analysis of financial condition and results of operations should be read in conjunction with the information under item 1 .
business , item 1a .
risk factors and item 8 .
financial statements and supplementary data found in this annual report on form 10-k .
spin-off downstream business on june 30 , 2011 , the spin-off of marathon 2019s downstream business was completed , creating two independent energy companies : marathon oil and mpc .
marathon stockholders at the close of business on the record date of june 27 , 2011 received one share of mpc common stock for every two shares of marathon common stock held .
a private letter tax ruling received in june 2011 from the irs affirmed the tax-free nature of the spin-off .
activities related to the downstream business have been treated as discontinued operations in 2011 and 2010 ( see item 8 .
financial statements and supplementary data 2013 note 3 to the consolidated financial statements for additional information ) .
overview 2013 market conditions exploration and production prevailing prices for the various grades of crude oil and natural gas that we produce significantly impact our revenues and cash flows .
the following table lists benchmark crude oil and natural gas price annual averages for the past three years. .

benchmark                                         | 2012     | 2011     | 2010
------------------------------------------------- | -------- | -------- | -------
wti crude oil ( dollars per bbl )                 | $ 94.15  | $ 95.11  | $ 79.61
brent ( europe ) crude oil ( dollars per bbl )    | $ 111.65 | $ 111.26 | $ 79.51
henry hub natural gas ( dollars per mmbtu ) ( a ) | $ 2.79   | $ 4.04   | $ 4.39

henry hub natural gas ( dollars per mmbtu ) ( a ) $ 2.79 $ 4.04 $ 4.39 ( a ) settlement date average .
liquid hydrocarbon 2013 prices of crude oil have been volatile in recent years , but less so when comparing annual averages for 2012 and 2011 .
in 2011 , crude prices increased over 2010 levels , with increases in brent averages outstripping those in wti .
the quality , location and composition of our liquid hydrocarbon production mix will cause our u.s .
liquid hydrocarbon realizations to differ from the wti benchmark .
in 2012 , 2011 and 2010 , the percentage of our u.s .
crude oil and condensate production that was sour averaged 37 percent , 58 percent and 68 percent .
sour crude contains more sulfur and tends to be heavier than light sweet crude oil so that refining it is more costly and produces lower value products ; therefore , sour crude is considered of lower quality and typically sells at a discount to wti .
the percentage of our u.s .
crude and condensate production that is sour has been decreasing as onshore production from the eagle ford and bakken shale plays increases and production from the gulf of mexico declines .
in recent years , crude oil sold along the u.s .
gulf coast has been priced at a premium to wti because the louisiana light sweet benchmark has been tracking brent , while production from inland areas farther from large refineries has been at a discount to wti .
ngls were 10 percent , 7 percent and 6 percent of our u.s .
liquid hydrocarbon sales in 2012 , 2011 and 2010 .
in 2012 , our sales of ngls increased due to our development of u.s .
unconventional liquids-rich plays.


for marketing .
there are several methods that can be used to determine the estimated fair value of the ipr&d acquired in a business combination .
we utilized the 201cincome method , 201d which applies a probability weighting to the estimated future net cash fl ows that are derived from projected sales revenues and estimated costs .
these projec- tions are based on factors such as relevant market size , patent protection , historical pricing of similar products , and expected industry trends .
the estimated future net cash fl ows are then discounted to the present value using an appropriate discount rate .
this analysis is performed for each project independently .
in accordance with fin 4 , applicability of fasb statement no .
2 to business combinations accounted for by the purchase method , these acquired ipr&d intangible assets totaling $ 4.71 billion and $ 340.5 million in 2008 and 2007 , respectively , were expensed immediately subsequent to the acquisition because the products had no alternative future use .
the ongoing activities with respect to each of these products in development are not material to our research and development expenses .
in addition to the acquisitions of businesses , we also acquired several products in development .
the acquired ipr&d related to these products of $ 122.0 million and $ 405.1 million in 2008 and 2007 , respectively , was also writ- ten off by a charge to income immediately upon acquisition because the products had no alternative future use .
imclone acquisition on november 24 , 2008 , we acquired all of the outstanding shares of imclone systems inc .
( imclone ) , a biopharma- ceutical company focused on advancing oncology care , for a total purchase price of approximately $ 6.5 billion , which was fi nanced through borrowings .
this strategic combination will offer both targeted therapies and oncolytic agents along with a pipeline spanning all phases of clinical development .
the combination also expands our bio- technology capabilities .
the acquisition has been accounted for as a business combination under the purchase method of accounting , resulting in goodwill of $ 419.5 million .
no portion of this goodwill is expected to be deductible for tax purposes .
allocation of purchase price we are currently determining the fair values of a signifi cant portion of these net assets .
the purchase price has been preliminarily allocated based on an estimate of the fair value of assets acquired and liabilities assumed as of the date of acquisition .
the fi nal determination of these fair values will be completed as soon as possible but no later than one year from the acquisition date .
although the fi nal determination may result in asset and liability fair values that are different than the preliminary estimates of these amounts included herein , it is not expected that those differences will be material to our fi nancial results .
estimated fair value at november 24 , 2008 .

cash and short-term investments              | $ 982.9
-------------------------------------------- | ----------------
inventories                                  | 136.2
developed product technology ( erbitux ) 1   | 1057.9
goodwill                                     | 419.5
property and equipment                       | 339.8
debt assumed                                 | -600.0 ( 600.0 )
deferred taxes                               | -315.0 ( 315.0 )
deferred income                              | -127.7 ( 127.7 )
other assets and liabilities 2014 net        | -72.1 ( 72.1 )
acquired in-process research and development | 4685.4
total purchase price                         | $ 6506.9

1this intangible asset will be amortized on a straight-line basis through 2023 in the u.s .
and 2018 in the rest of the world .
all of the estimated fair value of the acquired ipr&d is attributable to oncology-related products in develop- ment , including $ 1.33 billion to line extensions for erbitux .
a signifi cant portion ( 81 percent ) of the remaining value of acquired ipr&d is attributable to two compounds in phase iii clinical testing and one compound in phase ii clini- cal testing , all targeted to treat various forms of cancers .
the discount rate we used in valuing the acquired ipr&d projects was 13.5 percent , and the charge for acquired ipr&d of $ 4.69 billion recorded in the fourth quarter of 2008 , was not deductible for tax purposes .
pro forma financial information the following unaudited pro forma fi nancial information presents the combined results of our operations with


note 11 .
commitments and contingencies commitments leases the company fffds corporate headquarters is located in danvers , massachusetts .
this facility encompasses most of the company fffds u.s .
operations , including research and development , manufacturing , sales and marketing and general and administrative departments .
in october 2017 , the acquired its corporate headquarters for approximately $ 16.5 million and terminated its existing lease arrangement ( see note 6 ) .
future minimum lease payments under non-cancelable leases as of march 31 , 2018 are approximately as follows : fiscal years ending march 31 , operating leases ( in $ 000s ) .

fiscal years ending march 31, | operating leases ( in $ 000s )
----------------------------- | ------------------------------
2019                          | $ 2078
2020                          | 1888
2021                          | 1901
2022                          | 1408
2023                          | 891
thereafter                    | 1923
total minimum lease payments  | $ 10089

in february 2017 , the company entered into a lease agreement for an additional 21603 square feet of office space in danvers , massachusetts which expires on july 31 , 2022 .
in december 2017 , the company entered into an amendment to this lease to extend the term through august 31 , 2025 and to add an additional 6607 square feet of space in which rent would begin around june 1 , 2018 .
the amendment also allows the company a right of first offer to purchase the property from january 1 , 2018 through august 31 , 2035 , if the lessor decides to sell the building or receives an offer to purchase the building from a third-party buyer .
in march 2018 , the company entered into an amendment to the lease to add an additional 11269 square feet of space for which rent will begin on or around june 1 , 2018 through august 31 , 2025 .
the annual rent expense for this lease agreement is estimated to be $ 0.4 million .
in september 2016 , the company entered into a lease agreement in berlin , germany which commenced in may 2017 and expires in may 2024 .
the annual rent expense for the lease is estimated to be $ 0.3 million .
in october 2016 , the company entered into a lease agreement for an office in tokyokk japan and expires in september 2021 .
the office houses administrative , regulatory , and training personnel in connection with the company fffds commercial launch in japan .
the annual rent expense for the lease is estimated to be $ 0.9 million .
license agreements in april 2014 , the company entered into an exclusive license agreement for the rights to certain optical sensor technologies in the field of cardio-circulatory assist devices .
pursuant to the terms of the license agreement , the company agreed to make potential payments of $ 6.0 million .
through march 31 , 2018 , the company has made $ 3.5 million in milestones payments which included a $ 1.5 million upfront payment upon the execution of the agreement .
any potential future milestone payment amounts have not been included in the contractual obligations table above due to the uncertainty related to the successful achievement of these milestones .
contingencies from time to time , the company is involved in legal and administrative proceedings and claims of various types .
in some actions , the claimants seek damages , as well as other relief , which , if granted , would require significant expenditures .
the company records a liability in its consolidated financial statements for these matters when a loss is known or considered probable and the amount can be reasonably estimated .
the company reviews these estimates each accounting period as additional information is known and adjusts the loss provision when appropriate .
if a matter is both probable to result in liability and the amount of loss can be reasonably estimated , the company estimates and discloses the possible loss or range of loss .
if the loss is not probable or cannot be reasonably estimated , a liability is not recorded in its consolidated financial statements.


our digital media business consists of our websites and mobile and video-on-demand ( 201cvod 201d ) services .
our websites include network branded websites such as discovery.com , tlc.com and animalplanet.com , and other websites such as howstuffworks.com , an online source of explanations of how the world actually works ; treehugger.com , a comprehensive source for 201cgreen 201d news , solutions and product information ; and petfinder.com , a leading pet adoption destination .
together , these websites attracted an average of 24 million cumulative unique monthly visitors , according to comscore , inc .
in 2011 .
international networks our international networks segment principally consists of national and pan-regional television networks .
this segment generates revenues primarily from fees charged to operators who distribute our networks , which primarily include cable and dth satellite service providers , and from advertising sold on our television networks and websites .
discovery channel , animal planet and tlc lead the international networks 2019 portfolio of television networks , which are distributed in virtually every pay-television market in the world through an infrastructure that includes operational centers in london , singapore and miami .
international networks has one of the largest international distribution platforms of networks with one to twelve networks in more than 200 countries and territories around the world .
at december 31 , 2011 , international networks operated over 150 unique distribution feeds in over 40 languages with channel feeds customized according to language needs and advertising sales opportunities .
our international networks segment owns and operates the following television networks which reached the following number of subscribers as of december 31 , 2011 : education and other our education and other segment primarily includes the sale of curriculum-based product and service offerings and postproduction audio services .
this segment generates revenues primarily from subscriptions charged to k-12 schools for access to an online suite of curriculum-based vod tools , professional development services , and to a lesser extent student assessment and publication of hardcopy curriculum-based content .
our education business also participates in corporate partnerships , global brand and content licensing business with leading non-profits , foundations and trade associations .
other businesses primarily include postproduction audio services that are provided to major motion picture studios , independent producers , broadcast networks , cable channels , advertising agencies , and interactive producers .
content development our content development strategy is designed to increase viewership , maintain innovation and quality leadership , and provide value for our network distributors and advertising customers .
substantially all content is sourced from a wide range of third-party producers , which includes some of the world 2019s leading nonfiction production companies with which we have developed long-standing relationships , as well as independent producers .
our production arrangements fall into three categories : produced , coproduced and licensed .
substantially all produced content includes programming which we engage third parties to develop and produce while we retain editorial control and own most or all of the rights in exchange for paying all development and production costs .
coproduced content refers to program rights acquired that we have collaborated with third parties to finance and develop .
coproduced programs are typically high-cost projects for which neither we nor our coproducers wish to bear the entire cost or productions in which the producer has already taken on an international broadcast partner .
licensed content is comprised of films or series that have been previously produced by third parties .
global networks international subscribers ( millions ) regional networks international subscribers ( millions ) .

global networks discovery channel | international subscribers ( millions ) 213 | regional networks dmax        | international subscribers ( millions ) 47
--------------------------------- | ------------------------------------------ | ----------------------------- | -----------------------------------------
animal planet                     | 166                                        | discovery kids                | 37
tlc real time and travel & living | 150                                        | liv                           | 29
discovery science                 | 66                                         | quest                         | 23
discovery home & health           | 48                                         | discovery history             | 13
turbo                             | 37                                         | shed                          | 12
discovery world                   | 27                                         | discovery en espanol ( u.s. ) | 5
investigation discovery           | 23                                         | discovery famillia ( u.s. )   | 4
hd services                       | 17                                         |                               |


devon energy corporation and subsidiaries notes to consolidated financial statements 2013 ( continued ) debt maturities as of december 31 , 2013 , excluding premiums and discounts , are as follows ( in millions ) : .

2014                | $ 4067
------------------- | -------
2015                | 2014
2016                | 500
2017                | 750
2018                | 125
2019 and thereafter | 6600
total               | $ 12042

credit lines devon has a $ 3.0 billion syndicated , unsecured revolving line of credit ( the 201csenior credit facility 201d ) that matures on october 24 , 2018 .
however , prior to the maturity date , devon has the option to extend the maturity for up to one additional one-year period , subject to the approval of the lenders .
amounts borrowed under the senior credit facility may , at the election of devon , bear interest at various fixed rate options for periods of up to twelve months .
such rates are generally less than the prime rate .
however , devon may elect to borrow at the prime rate .
the senior credit facility currently provides for an annual facility fee of $ 3.8 million that is payable quarterly in arrears .
as of december 31 , 2013 , there were no borrowings under the senior credit facility .
the senior credit facility contains only one material financial covenant .
this covenant requires devon 2019s ratio of total funded debt to total capitalization , as defined in the credit agreement , to be no greater than 65 percent .
the credit agreement contains definitions of total funded debt and total capitalization that include adjustments to the respective amounts reported in the accompanying financial statements .
also , total capitalization is adjusted to add back noncash financial write-downs such as full cost ceiling impairments or goodwill impairments .
as of december 31 , 2013 , devon was in compliance with this covenant with a debt-to- capitalization ratio of 25.7 percent .
commercial paper devon has access to $ 3.0 billion of short-term credit under its commercial paper program .
commercial paper debt generally has a maturity of between 1 and 90 days , although it can have a maturity of up to 365 days , and bears interest at rates agreed to at the time of the borrowing .
the interest rate is generally based on a standard index such as the federal funds rate , libor , or the money market rate as found in the commercial paper market .
as of december 31 , 2013 , devon 2019s weighted average borrowing rate on its commercial paper borrowings was 0.30 percent .
other debentures and notes following are descriptions of the various other debentures and notes outstanding at december 31 , 2013 , as listed in the table presented at the beginning of this note .
geosouthern debt in december 2013 , in conjunction with the planned geosouthern acquisition , devon issued $ 2.25 billion aggregate principal amount of fixed and floating rate senior notes resulting in cash proceeds of approximately


the following table summarizes the total contractual amount of credit-related , off-balance sheet financial instruments at december 31 .
amounts reported do not reflect participations to independent third parties. .

( in millions )                       | 2008     | 2007
------------------------------------- | -------- | --------
indemnified securities financing      | $ 324590 | $ 558368
liquidity asset purchase agreements   | 28800    | 35339
unfunded commitments to extend credit | 20981    | 17533
standby letters of credit             | 6061     | 4711

approximately 81% ( 81 % ) of the unfunded commitments to extend credit expire within one year from the date of issue .
since many of the commitments are expected to expire or renew without being drawn upon , the total commitment amounts do not necessarily represent future cash requirements .
securities finance : on behalf of our customers , we lend their securities to creditworthy brokers and other institutions .
we generally indemnify our customers for the fair market value of those securities against a failure of the borrower to return such securities .
collateral funds received in connection with our securities finance services are held by us as agent and are not recorded in our consolidated statement of condition .
we require the borrowers to provide collateral in an amount equal to or in excess of 100% ( 100 % ) of the fair market value of the securities borrowed .
the borrowed securities are revalued daily to determine if additional collateral is necessary .
in this regard , we held , as agent , cash and u.s .
government securities with an aggregate fair value of $ 333.07 billion and $ 572.93 billion as collateral for indemnified securities on loan at december 31 , 2008 and 2007 , respectively , presented in the table above .
the collateral held by us is invested on behalf of our customers .
in certain cases , the collateral is invested in third-party repurchase agreements , for which we indemnify the customer against loss of the principal invested .
we require the repurchase agreement counterparty to provide collateral in an amount equal to or in excess of 100% ( 100 % ) of the amount of the repurchase agreement .
the indemnified repurchase agreements and the related collateral are not recorded in our consolidated statement of condition .
of the collateral of $ 333.07 billion at december 31 , 2008 and $ 572.93 billion at december 31 , 2007 referenced above , $ 68.37 billion at december 31 , 2008 and $ 106.13 billion at december 31 , 2007 was invested in indemnified repurchase agreements .
we held , as agent , cash and securities with an aggregate fair value of $ 71.87 billion and $ 111.02 billion as collateral for indemnified investments in repurchase agreements at december 31 , 2008 and december 31 , 2007 , respectively .
asset-backed commercial paper program : in the normal course of our business , we provide liquidity and credit enhancement to an asset-backed commercial paper program sponsored and administered by us , described in note 12 .
the commercial paper issuances and commitments of the commercial paper conduits to provide funding are supported by liquidity asset purchase agreements and back-up liquidity lines of credit , the majority of which are provided by us .
in addition , we provide direct credit support to the conduits in the form of standby letters of credit .
our commitments under liquidity asset purchase agreements and back-up lines of credit totaled $ 23.59 billion at december 31 , 2008 , and are included in the preceding table .
our commitments under standby letters of credit totaled $ 1.00 billion at december 31 , 2008 , and are also included in the preceding table .
legal proceedings : several customers have filed litigation claims against us , some of which are putative class actions purportedly on behalf of customers invested in certain of state street global advisors 2019 , or ssga 2019s , active fixed-income strategies .
these claims related to investment losses in one or more of ssga 2019s strategies that included sub-prime investments .
in 2007 , we established a reserve of approximately $ 625 million to address legal exposure associated with the under-performance of certain active fixed-income strategies managed by ssga and customer concerns as to whether the execution of these strategies was consistent with the customers 2019 investment intent .
these strategies were adversely impacted by exposure to , and the lack of liquidity in


item 11 2014executive compensation we incorporate by reference in this item 11 the information relating to executive and director compensation contained under the headings 201cother information about the board and its committees , 201d 201ccompensation and other benefits 201d and 201creport of the compensation committee 201d from our proxy statement to be delivered in connection with our 2007 annual meeting of shareholders to be held on september 26 , 2007 .
item 12 2014security ownership of certain beneficial owners andmanagement and related stockholdermatters we incorporate by reference in this item 12 the information relating to ownership of our common stock by certain persons contained under the headings 201ccommon stock ownership of management 201d and 201ccommon stock ownership by certain other persons 201d from our proxy statement to be delivered in connection with our 2007 annual meeting of shareholders to be held on september 26 , 2007 .
we have four compensation plans under which our equity securities are authorized for issuance .
the global payments inc .
amended and restated 2000 long-term incentive plan , global payments inc .
amended and restated 2005 incentive plan , the non-employee director stock option plan , and employee stock purchase plan have been approved by security holders .
the information in the table below is as of may 31 , 2007 .
for more information on these plans , see note 8 to notes to consolidated financial statements .
plan category number of securities to be issued upon exercise of outstanding options , warrants and rights weighted- average exercise price of outstanding options , warrants and rights number of securities remaining available for future issuance under equity compensation plans ( excluding securities reflected in column ( a ) ) equity compensation plans approved by security holders: .
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5171000 $ 25 7779000 ( 1 ) equity compensation plans not approved by security holders: .
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5171000 $ 25 7779000 ( 1 ) ( 1 ) also includes shares of common stock available for issuance other than upon the exercise of an option , warrant or right under the amended and restated 2000 non-employee director stock option plan , the amended and restated 2005 incentive plan and the amended and restated 2000 employee stock purchase item 13 2014certain relationships and related transactions , and director independence we incorporate by reference in this item 13 the information regarding certain relationships and related transactions between us and some of our affiliates and the independence of our board of directors contained under the headings 201ccertain relationships and related transactions 201d and 201cother information about the board and its committees 2014director independence 201d from our proxy statement to be delivered in connection with our 2007 annual meeting of shareholders to be held on september 26 , 2007 .
item 14 2014principal accounting fees and services we incorporate by reference in this item 14 the information regarding principal accounting fees and services contained under the heading 201cauditor information 201d from our proxy statement to be delivered in connection with our 2007 annual meeting of shareholders to be held on september 26 , 2007. .

plan category                                               | number of securities to be issued upon exercise of outstanding options warrants and rights ( a ) | weighted- average exercise price of outstanding options warrants and rights ( b ) | number of securities remaining available for futureissuance under equity compensation plans ( excluding securities reflected in column ( a ) ) ( c ) |
----------------------------------------------------------- | ------------------------------------------------------------------------------------------------ | --------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------- | --------
equity compensation plans approved by security holders:     | 5171000                                                                                | $ 25                                                                              | 7779000                                                                                | -1 ( 1 )
equity compensation plans not approved by security holders: | 2014                                                                                | 2014                                                                              | 2014                                                                                |
total                                                       | 5171000                                                                                | $ 25                                                                              | 7779000                                                                                | -1 ( 1 )

item 11 2014executive compensation we incorporate by reference in this item 11 the information relating to executive and director compensation contained under the headings 201cother information about the board and its committees , 201d 201ccompensation and other benefits 201d and 201creport of the compensation committee 201d from our proxy statement to be delivered in connection with our 2007 annual meeting of shareholders to be held on september 26 , 2007 .
item 12 2014security ownership of certain beneficial owners andmanagement and related stockholdermatters we incorporate by reference in this item 12 the information relating to ownership of our common stock by certain persons contained under the headings 201ccommon stock ownership of management 201d and 201ccommon stock ownership by certain other persons 201d from our proxy statement to be delivered in connection with our 2007 annual meeting of shareholders to be held on september 26 , 2007 .
we have four compensation plans under which our equity securities are authorized for issuance .
the global payments inc .
amended and restated 2000 long-term incentive plan , global payments inc .
amended and restated 2005 incentive plan , the non-employee director stock option plan , and employee stock purchase plan have been approved by security holders .
the information in the table below is as of may 31 , 2007 .
for more information on these plans , see note 8 to notes to consolidated financial statements .
plan category number of securities to be issued upon exercise of outstanding options , warrants and rights weighted- average exercise price of outstanding options , warrants and rights number of securities remaining available for future issuance under equity compensation plans ( excluding securities reflected in column ( a ) ) equity compensation plans approved by security holders: .
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5171000 $ 25 7779000 ( 1 ) equity compensation plans not approved by security holders: .
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5171000 $ 25 7779000 ( 1 ) ( 1 ) also includes shares of common stock available for issuance other than upon the exercise of an option , warrant or right under the amended and restated 2000 non-employee director stock option plan , the amended and restated 2005 incentive plan and the amended and restated 2000 employee stock purchase item 13 2014certain relationships and related transactions , and director independence we incorporate by reference in this item 13 the information regarding certain relationships and related transactions between us and some of our affiliates and the independence of our board of directors contained under the headings 201ccertain relationships and related transactions 201d and 201cother information about the board and its committees 2014director independence 201d from our proxy statement to be delivered in connection with our 2007 annual meeting of shareholders to be held on september 26 , 2007 .
item 14 2014principal accounting fees and services we incorporate by reference in this item 14 the information regarding principal accounting fees and services contained under the heading 201cauditor information 201d from our proxy statement to be delivered in connection with our 2007 annual meeting of shareholders to be held on september 26 , 2007.


kimco realty corporation and subsidiaries notes to consolidated financial statements , continued the units consisted of ( i ) approximately 81.8 million preferred a units par value $ 1.00 per unit , which pay the holder a return of 7.0% ( 7.0 % ) per annum on the preferred a par value and are redeemable for cash by the holder at any time after one year or callable by the company any time after six months and contain a promote feature based upon an increase in net operating income of the properties capped at a 10.0% ( 10.0 % ) increase , ( ii ) 2000 class a preferred units , par value $ 10000 per unit , which pay the holder a return equal to libor plus 2.0% ( 2.0 % ) per annum on the class a preferred par value and are redeemable for cash by the holder at any time after november 30 , 2010 , ( iii ) 2627 class b-1 preferred units , par value $ 10000 per unit , which pay the holder a return equal to 7.0% ( 7.0 % ) per annum on the class b-1 preferred par value and are redeemable by the holder at any time after november 30 , 2010 , for cash or at the company 2019s option , shares of the company 2019s common stock , equal to the cash redemption amount , as defined , ( iv ) 5673 class b-2 preferred units , par value $ 10000 per unit , which pay the holder a return equal to 7.0% ( 7.0 % ) per annum on the class b-2 preferred par value and are redeemable for cash by the holder at any time after november 30 , 2010 , and ( v ) 640001 class c downreit units , valued at an issuance price of $ 30.52 per unit which pay the holder a return at a rate equal to the company 2019s common stock dividend and are redeemable by the holder at any time after november 30 , 2010 , for cash or at the company 2019s option , shares of the company 2019s common stock equal to the class c cash amount , as defined .
the following units have been redeemed as of december 31 , 2010 : redeemed par value redeemed ( in millions ) redemption type .

type                      | units redeemed | par value redeemed ( in millions ) | redemption type
------------------------- | -------------- | ---------------------------------- | ----------------------------
preferred a units         | 2200000        | $ 2.2                              | cash
class a preferred units   | 2000           | $ 20.0                             | cash
class b-1 preferred units | 2438           | $ 24.4                             | cash
class b-2 preferred units | 5576           | $ 55.8                             | cash/charitable contribution
class c downreit units    | 61804          | $ 1.9                              | cash

noncontrolling interest relating to the remaining units was $ 110.4 million and $ 113.1 million as of december 31 , 2010 and 2009 , respectively .
during 2006 , the company acquired two shopping center properties located in bay shore and centereach , ny .
included in noncontrolling interests was approximately $ 41.6 million , including a discount of $ 0.3 million and a fair market value adjustment of $ 3.8 million , in redeemable units ( the 201credeemable units 201d ) , issued by the company in connection with these transactions .
the prop- erties were acquired through the issuance of $ 24.2 million of redeemable units , which are redeemable at the option of the holder ; approximately $ 14.0 million of fixed rate redeemable units and the assumption of approximately $ 23.4 million of non-recourse debt .
the redeemable units consist of ( i ) 13963 class a units , par value $ 1000 per unit , which pay the holder a return of 5% ( 5 % ) per annum of the class a par value and are redeemable for cash by the holder at any time after april 3 , 2011 , or callable by the company any time after april 3 , 2016 , and ( ii ) 647758 class b units , valued at an issuance price of $ 37.24 per unit , which pay the holder a return at a rate equal to the company 2019s common stock dividend and are redeemable by the holder at any time after april 3 , 2007 , for cash or at the option of the company for common stock at a ratio of 1:1 , or callable by the company any time after april 3 , 2026 .
the company is restricted from disposing of these assets , other than through a tax free transaction , until april 2016 and april 2026 for the centereach , ny , and bay shore , ny , assets , respectively .
during 2007 , 30000 units , or $ 1.1 million par value , of theclass bunits were redeemed by the holder in cash at the option of the company .
noncontrolling interest relating to the units was $ 40.4 million and $ 40.3 million as of december 31 , 2010 and 2009 , respectively .
noncontrolling interests also includes 138015 convertible units issued during 2006 , by the company , which were valued at approxi- mately $ 5.3 million , including a fair market value adjustment of $ 0.3 million , related to an interest acquired in an office building located in albany , ny .
these units are redeemable at the option of the holder after one year for cash or at the option of the company for the company 2019s common stock at a ratio of 1:1 .
the holder is entitled to a distribution equal to the dividend rate of the company 2019s common stock .
the company is restricted from disposing of these assets , other than through a tax free transaction , until january 2017.


management 2019s discussion and analysis of financial conditionand results of operations d u k e r e a l t y c o r p o r a t i o n 1 1 2 0 0 2 a n n u a l r e p o r t 2022 interest expense on the company 2019s secured debt decreased from $ 30.8 million in 2001 to $ 22.9 million in 2002 as the company paid off $ 13.5 million of secured debt throughout 2002 and experienced lower borrowings on its secured line of credit during 2002 compared to 2001 .
additionally , the company paid off approximately $ 128.5 million of secured debt throughout 2001 .
2022 interest expense on the company 2019s $ 500 million unsecured line of credit decreased by approximately $ 1.1 million in 2002 compared to 2001 as the company maintained lower balances on the line throughout most of 2002 .
as a result of the above-mentioned items , earnings from rental operations decreased $ 35.0 million from $ 254.1 million for the year ended december 31 , 2001 , to $ 219.1 million for the year ended december 31 , 2002 .
service operations service operations primarily consist of leasing , management , construction and development services for joint venture properties and properties owned by third parties .
service operations revenues decreased from $ 80.5 million for the year ended december 31 , 2001 , to $ 68.6 million for the year ended december 31 , 2002 .
the prolonged effect of the slow economy has been the primary factor in the overall decrease in revenues .
the company experienced a decrease of $ 12.7 million in net general contractor revenues because of a decrease in the volume of construction in 2002 , compared to 2001 , as well as slightly lower profit margins .
property management , maintenance and leasing fee revenues decreased from $ 22.8 million in 2001 to $ 14.3 million in 2002 primarily because of a decrease in landscaping maintenance revenue resulting from the sale of the landscaping operations in the third quarter of 2001 .
construction management and development activity income represents construction and development fees earned on projects where the company acts as the construction manager along with profits from the company 2019s held for sale program whereby the company develops a property for sale upon completion .
the increase in revenues of $ 10.3 million in 2002 is primarily due to an increase in volume of the sale of properties from the held for sale program .
service operations expenses decreased from $ 45.3 million in 2001 to $ 38.3 million in 2002 .
the decrease is attributable to the decrease in construction and development activity and the reduced overhead costs as a result of the sale of the landscape business in 2001 .
as a result of the above , earnings from service operations decreased from $ 35.1 million for the year ended december 31 , 2001 , to $ 30.3 million for the year ended december 31 , 2002 .
general and administrative expense general and administrative expense increased from $ 15.6 million in 2001 to $ 25.4 million for the year ended december 31 , 2002 .
the company has been successful reducing total operating and administration costs ; however , reduced construction and development activities have resulted in a greater amount of overhead being charged to general and administrative expense instead of being capitalized into development projects or charged to service operations .
other income and expenses gain on sale of land and depreciable property dispositions , net of impairment adjustment , is comprised of the following amounts in 2002 and 2001 : gain on sales of depreciable properties represent sales of previously held for investment rental properties .
beginning in 2000 and continuing into 2001 , the company pursued favorable opportunities to dispose of real estate assets that no longer met long-term investment objectives .
in 2002 , the company significantly reduced this property sales program until the business climate improves and provides better investment opportunities for the sale proceeds .
gain on land sales represents sales of undeveloped land owned by the company .
the company pursues opportunities to dispose of land in markets with a high concentration of undeveloped land and those markets where the land no longer meets strategic development plans of the company .
the company recorded a $ 9.4 million adjustment in 2002 associated with six properties determined to have an impairment of book value .
the company has analyzed each of its in-service properties and has determined that there are no additional valuation adjustments that need to be made as of december 31 , 2002 .
the company recorded an adjustment of $ 4.8 million in 2001 for one property that the company had contracted to sell for a price less than its book value .
other revenue for the year ended december 31 , 2002 , includes $ 1.4 million of gain related to an interest rate swap that did not qualify for hedge accounting. .

                                        | 2002           | 2001
--------------------------------------- | -------------- | --------------
gain on sales of depreciable properties | $ 4491         | $ 45428
gain on land sales                      | 4478           | 5080
impairment adjustment                   | -9379 ( 9379 ) | -4800 ( 4800 )
total                                   | $ -410 ( 410 ) | $ 45708


allowance for doubtful accounts is as follows: .

                             | 2010       | 2009       | 2008
---------------------------- | ---------- | ---------- | ----------
balance at beginning of year | $ 160      | $ 133      | $ 86
provision                    | 38         | 54         | 65
amounts written off          | -13 ( 13 ) | -27 ( 27 ) | -18 ( 18 )
balance at end of year       | $ 185      | $ 160      | $ 133

discontinued operations during the fourth quarter of 2009 , schlumberger recorded a net $ 22 million charge related to the resolution of a customs assessment pertaining to its former offshore contract drilling business , as well as the resolution of certain contingencies associated with other previously disposed of businesses .
this amount is included in income ( loss ) from discontinued operations in the consolidated statement of income .
during the first quarter of 2008 , schlumberger recorded a gain of $ 38 million related to the resolution of a contingency associated with a previously disposed of business .
this gain is included in income ( loss ) from discon- tinued operations in the consolidated statement of income .
part ii , item 8


zimmer biomet holdings , inc .
2015 form 10-k annual report through february 25 , 2016 , we repurchased approximately $ 415.0 million of shares of our common stock , which includes the $ 250.0 million of shares that we repurchased from certain selling stockholders on february 10 , 2016 .
in order to achieve operational synergies , we expect cash outlays related to our integration plans to be approximately $ 290.0 million in 2016 .
these cash outlays are necessary to achieve our integration goals of net annual pre-tax operating profit synergies of $ 350.0 million by the end of the third year post-closing date .
also as discussed in note 20 to our consolidated financial statements , as of december 31 , 2015 , a short-term liability of $ 50.0 million and long-term liability of $ 264.6 million related to durom cup product liability claims was recorded on our consolidated balance sheet .
we expect to continue paying these claims over the next few years .
we expect to be reimbursed a portion of these payments for product liability claims from insurance carriers .
as of december 31 , 2015 , we have received a portion of the insurance proceeds we estimate we will recover .
we have a long-term receivable of $ 95.3 million remaining for future expected reimbursements from our insurance carriers .
we also had a short-term liability of $ 33.4 million related to biomet metal-on-metal hip implant claims .
at december 31 , 2015 , we had ten tranches of senior notes outstanding as follows ( dollars in millions ) : principal interest rate maturity date .

principal | interest rate      | maturity date
--------- | ------------------ | ----------------
$ 500.0   | 1.450% ( 1.450 % ) | april 1 2017
1150.0    | 2.000              | april 1 2018
500.0     | 4.625              | november 30 2019
1500.0    | 2.700              | april 1 2020
300.0     | 3.375              | november 30 2021
750.0     | 3.150              | april 1 2022
2000.0    | 3.550              | april 1 2025
500.0     | 4.250              | august 15 2035
500.0     | 5.750              | november 30 2039
1250.0    | 4.450              | august 15 2045

we issued $ 7.65 billion of senior notes in march 2015 ( the 201cmerger notes 201d ) , the proceeds of which were used to finance a portion of the cash consideration payable in the biomet merger , pay merger related fees and expenses and pay a portion of biomet 2019s funded debt .
on june 24 , 2015 , we also borrowed $ 3.0 billion on a u.s .
term loan ( 201cu.s .
term loan 201d ) to fund the biomet merger .
we may , at our option , redeem our senior notes , in whole or in part , at any time upon payment of the principal , any applicable make-whole premium , and accrued and unpaid interest to the date of redemption .
in addition , the merger notes and the 3.375% ( 3.375 % ) senior notes due 2021 may be redeemed at our option without any make-whole premium at specified dates ranging from one month to six months in advance of the scheduled maturity date .
we have a $ 4.35 billion credit agreement ( 201ccredit agreement 201d ) that contains : ( i ) a 5-year unsecured u.s .
term loan facility ( 201cu.s .
term loan facility 201d ) in the principal amount of $ 3.0 billion , and ( ii ) a 5-year unsecured multicurrency revolving facility ( 201cmulticurrency revolving facility 201d ) in the principal amount of $ 1.35 billion .
the multicurrency revolving facility will mature in may 2019 , with two one-year extensions available at our option .
borrowings under the multicurrency revolving facility may be used for general corporate purposes .
there were no borrowings outstanding under the multicurrency revolving facility as of december 31 , 2015 .
the u.s .
term loan facility will mature in june 2020 , with principal payments due beginning september 30 , 2015 , as follows : $ 75.0 million on a quarterly basis during the first three years , $ 112.5 million on a quarterly basis during the fourth year , and $ 412.5 million on a quarterly basis during the fifth year .
in 2015 , we paid $ 500.0 million in principal under the u.s .
term loan facility , resulting in $ 2.5 billion in outstanding borrowings as of december 31 , we and certain of our wholly owned foreign subsidiaries are the borrowers under the credit agreement .
borrowings under the credit agreement bear interest at floating rates based upon indices determined by the currency of the borrowings plus an applicable margin determined by reference to our senior unsecured long-term credit rating , or at an alternate base rate , or , in the case of borrowings under the multicurrency revolving facility only , at a fixed rate determined through a competitive bid process .
the credit agreement contains customary affirmative and negative covenants and events of default for an unsecured financing arrangement , including , among other things , limitations on consolidations , mergers and sales of assets .
financial covenants include a consolidated indebtedness to consolidated ebitda ratio of no greater than 5.0 to 1.0 through june 24 , 2016 and no greater than 4.5 to 1.0 thereafter .
if our credit rating falls below investment grade , additional restrictions would result , including restrictions on investments and payment of dividends .
we were in compliance with all covenants under the credit agreement as of december 31 , 2015 .
commitments under the credit agreement are subject to certain fees .
on the multicurrency revolving facility , we pay a facility fee at a rate determined by reference to our senior unsecured long-term credit rating .
we have a japan term loan agreement with one of the lenders under the credit agreement for 11.7 billion japanese yen that will mature on may 31 , 2018 .
borrowings under the japan term loan bear interest at a fixed rate of 0.61 percent per annum until maturity .
we also have other available uncommitted credit facilities totaling $ 35.8 million .
we place our cash and cash equivalents in highly-rated financial institutions and limit the amount of credit exposure to any one entity .
we invest only in high-quality financial instruments in accordance with our internal investment policy .
as of december 31 , 2015 , we had short-term and long-term investments in debt securities with a fair value of $ 273.1 million .
these investments are in debt securities of many different issuers and , therefore , we believe we have no significant concentration of risk with a single issuer .
all of these debt securities remain highly rated and we believe the risk of default by the issuers is low.


operating expenses millions 2012 2011 2010 % (  % ) change 2012 v 2011 % (  % ) change 2011 v 2010 .

millions                         | 2012    | 2011    | 2010    | % (  % ) change 2012 v 2011 | % (  % ) change 2011 v 2010
-------------------------------- | ------- | ------- | ------- | --------------------------- | ---------------------------
compensation and benefits        | $ 4685  | $ 4681  | $ 4314  | -% ( - % )                  | 9% ( 9 % )
fuel                             | 3608    | 3581    | 2486    | 1                           | 44
purchased services and materials | 2143    | 2005    | 1836    | 7                           | 9
depreciation                     | 1760    | 1617    | 1487    | 9                           | 9
equipment and other rents        | 1197    | 1167    | 1142    | 3                           | 2
other                            | 788     | 782     | 719     | 1                           | 9
total                            | $ 14181 | $ 13833 | $ 11984 | 3% ( 3 % )                  | 15% ( 15 % )

operating expenses increased $ 348 million in 2012 versus 2011 .
depreciation , wage and benefit inflation , higher fuel prices and volume- related trucking services purchased by our logistics subsidiaries , contributed to higher expenses during the year .
efficiency gains , volume related fuel savings ( 2% ( 2 % ) fewer gallons of fuel consumed ) and $ 38 million of weather related expenses in 2011 , which favorably affects the comparison , partially offset the cost increase .
operating expenses increased $ 1.8 billion in 2011 versus 2010 .
our fuel price per gallon rose 36% ( 36 % ) during 2011 , accounting for $ 922 million of the increase .
wage and benefit inflation , volume-related costs , depreciation , and property taxes also contributed to higher expenses .
expenses increased $ 20 million for costs related to the flooding in the midwest and $ 18 million due to the impact of severe heat and drought in the south , primarily texas .
cost savings from productivity improvements and better resource utilization partially offset these increases .
a $ 45 million one-time payment relating to a transaction with csx intermodal , inc ( csxi ) increased operating expenses during the first quarter of 2010 , which favorably affects the comparison of operating expenses in 2011 to those in 2010 .
compensation and benefits 2013 compensation and benefits include wages , payroll taxes , health and welfare costs , pension costs , other postretirement benefits , and incentive costs .
expenses in 2012 were essentially flat versus 2011 as operational improvements and cost reductions offset general wage and benefit inflation and higher pension and other postretirement benefits .
in addition , weather related costs increased these expenses in 2011 .
a combination of general wage and benefit inflation , volume-related expenses , higher training costs associated with new hires , additional crew costs due to speed restrictions caused by the midwest flooding and heat and drought in the south , and higher pension expense drove the increase during 2011 compared to 2010 .
fuel 2013 fuel includes locomotive fuel and gasoline for highway and non-highway vehicles and heavy equipment .
higher locomotive diesel fuel prices , which averaged $ 3.22 per gallon ( including taxes and transportation costs ) in 2012 , compared to $ 3.12 in 2011 , increased expenses by $ 105 million .
volume , as measured by gross ton-miles , decreased 2% ( 2 % ) in 2012 versus 2011 , driving expense down .
the fuel consumption rate was flat year-over-year .
higher locomotive diesel fuel prices , which averaged $ 3.12 ( including taxes and transportation costs ) in 2011 , compared to $ 2.29 per gallon in 2010 , increased expenses by $ 922 million .
in addition , higher gasoline prices for highway and non-highway vehicles also increased year-over-year .
volume , as measured by gross ton-miles , increased 5% ( 5 % ) in 2011 versus 2010 , driving expense up by $ 122 million .
purchased services and materials 2013 expense for purchased services and materials includes the costs of services purchased from outside contractors and other service providers ( including equipment 2012 operating expenses


                                                   | 12/07  | 12/08 | 12/09  | 12/10  | 12/11  | 12/12
-------------------------------------------------- | ------ | ----- | ------ | ------ | ------ | ------
fidelity national information services inc .       | 100.00 | 70.08 | 101.93 | 120.01 | 117.34 | 157.38
s&p 500                                            | 100.00 | 63.00 | 79.67  | 91.67  | 93.61  | 108.59
s&p supercap data processing & outsourced services | 100.00 | 68.26 | 99.41  | 97.33  | 118.68 | 151.90

s&p supercap data processing & outsourced 100.00 68.26 99.41 97.33 118.68 151.90 item 6 .
selected financial data .
the selected financial data set forth below constitutes historical financial data of fis and should be read in conjunction with item 7 , management 2019s discussion and analysis of financial condition and results of operations , and item 8 , financial statements and supplementary data , included elsewhere in this report .
on october 1 , 2009 , we completed the acquisition of metavante technologies , inc .
( "metavante" ) .
the results of operations and financial position of metavante are included in the consolidated financial statements since the date of acquisition .
on july 2 , 2008 , we completed the spin-off of lender processing services , inc. , which was a former wholly-owned subsidiary ( "lps" ) .
for accounting purposes , the results of lps are presented as discontinued operations .
accordingly , all prior periods have been restated to present the results of fis on a stand alone basis and include the results of lps up to july 2 , 2008 , as discontinued operations.


part ii item 5 .
market for registrant 2019s common equity , related stockholder matters and issuer purchases of equity securities the following table presents reported quarterly high and low per share sale prices of our common stock on the new york stock exchange ( 201cnyse 201d ) for the years 2010 and 2009. .

2010                       | high    | low
-------------------------- | ------- | -------
quarter ended march 31     | $ 44.61 | $ 40.10
quarter ended june 30      | 45.33   | 38.86
quarter ended september 30 | 52.11   | 43.70
quarter ended december 31  | 53.14   | 49.61
2009                       | high    | low
quarter ended march 31     | $ 32.53 | $ 25.45
quarter ended june 30      | 34.52   | 27.93
quarter ended september 30 | 37.71   | 29.89
quarter ended december 31  | 43.84   | 35.03

on february 11 , 2011 , the closing price of our common stock was $ 56.73 per share as reported on the nyse .
as of february 11 , 2011 , we had 397612895 outstanding shares of common stock and 463 registered holders .
dividends we have not historically paid a dividend on our common stock .
payment of dividends in the future , when , as and if authorized by our board of directors , would depend upon many factors , including our earnings and financial condition , restrictions under applicable law and our current and future loan agreements , our debt service requirements , our capital expenditure requirements and other factors that our board of directors may deem relevant from time to time , including the potential determination to elect reit status .
in addition , the loan agreement for our revolving credit facility and term loan contain covenants that generally restrict our ability to pay dividends unless certain financial covenants are satisfied .
for more information about the restrictions under the loan agreement for the revolving credit facility and term loan , our notes indentures and the loan agreement related to our securitization , see item 7 of this annual report under the caption 201cmanagement 2019s discussion and analysis of financial condition and results of operations 2014liquidity and capital resources 2014factors affecting sources of liquidity 201d and note 6 to our consolidated financial statements included in this annual report.


stockholder return performance graphs the following graph compares the cumulative 5-year total stockholder return on our common stock relative to the cumulative total return of the nasdaq composite index and the s&p 400 information technology index .
the graph assumes that the value of the investment in our common stock and in each index ( including reinvestment of dividends ) was $ 100 on december 29 , 2007 and tracks it through december 29 , 2012 .
comparison of 5 year cumulative total return* among cadence design systems , inc. , the nasdaq composite index , and s&p 400 information technology cadence design systems , inc .
nasdaq composite s&p 400 information technology 12/29/1212/31/111/1/111/2/101/3/0912/29/07 *$ 100 invested on 12/29/07 in stock or 12/31/07 in index , including reinvestment of dividends .
indexes calculated on month-end basis .
copyright a9 2013 s&p , a division of the mcgraw-hill companies inc .
all rights reserved. .

                               | 12/29/2007 | 1/3/2009 | 1/2/2010 | 1/1/2011 | 12/31/2011 | 12/29/2012
------------------------------ | ---------- | -------- | -------- | -------- | ---------- | ----------
cadence design systems inc .   | 100.00     | 22.55    | 35.17    | 48.50    | 61.07      | 78.92
nasdaq composite               | 100.00     | 59.03    | 82.25    | 97.32    | 98.63      | 110.78
s&p 400 information technology | 100.00     | 54.60    | 82.76    | 108.11   | 95.48      | 109.88

the stock price performance included in this graph is not necessarily indicative of future stock price performance


other expense , net , decreased $ 6.2 million , or 50.0% ( 50.0 % ) , for the year ended december 31 , 2004 compared to the year ended december 31 , 2003 .
the decrease was primarily due to a reduction in charges on disposal and transfer costs of fixed assets and facility closure costs of $ 3.3 million , reduced legal charges of $ 1.5 million , and a reduction in expenses of $ 1.4 million consisting of individually insignificant items .
interest expense and income taxes interest expense decreased in 2004 by $ 92.2 million , or 75.7% ( 75.7 % ) , from 2003 .
this decrease included $ 73.3 million of expenses related to the company 2019s debt refinancing , which was completed in july 2003 .
the $ 73.3 million of expenses consisted of $ 55.9 million paid in premiums for the tender of the 95 20448% ( 20448 % ) senior subordinated notes , and a $ 17.4 million non-cash charge for the write-off of deferred financing fees related to the 95 20448% ( 20448 % ) notes and pca 2019s original revolving credit facility .
excluding the $ 73.3 million charge , interest expense was $ 18.9 million lower than in 2003 as a result of lower interest rates attributable to the company 2019s july 2003 refinancing and lower debt levels .
pca 2019s effective tax rate was 38.0% ( 38.0 % ) for the year ended december 31 , 2004 and 42.3% ( 42.3 % ) for the year ended december 31 , 2003 .
the higher tax rate in 2003 is due to stable permanent items over lower book income ( loss ) .
for both years 2004 and 2003 tax rates are higher than the federal statutory rate of 35.0% ( 35.0 % ) due to state income taxes .
year ended december 31 , 2003 compared to year ended december 31 , 2002 the historical results of operations of pca for the years ended december 31 , 2003 and 2002 are set forth below : for the year ended december 31 , ( in millions ) 2003 2002 change .

( in millions )                        | 2003             | 2002           | change
-------------------------------------- | ---------------- | -------------- | ----------------
net sales                              | $ 1735.5         | $ 1735.9       | $ -0.4 ( 0.4 )
income before interest and taxes       | $ 96.9           | $ 145.3        | $ -48.4 ( 48.4 )
interest expense net                   | -121.8 ( 121.8 ) | -67.7 ( 67.7 ) | -54.1 ( 54.1 )
income ( loss ) before taxes           | -24.9 ( 24.9 )   | 77.6           | -102.5 ( 102.5 )
( provision ) benefit for income taxes | 10.5             | -29.4 ( 29.4 ) | 39.9
net income ( loss )                    | $ -14.4 ( 14.4 ) | $ 48.2         | $ -62.6 ( 62.6 )

net sales net sales decreased by $ 0.4 million , or 0.0% ( 0.0 % ) , for the year ended december 31 , 2003 from the year ended december 31 , 2002 .
net sales increased due to improved sales volumes compared to 2002 , however , this increase was entirely offset by lower sales prices .
total corrugated products volume sold increased 2.1% ( 2.1 % ) to 28.1 billion square feet in 2003 compared to 27.5 billion square feet in 2002 .
on a comparable shipment-per-workday basis , corrugated products sales volume increased 1.7% ( 1.7 % ) in 2003 from 2002 .
shipments-per-workday is calculated by dividing our total corrugated products volume during the year by the number of workdays within the year .
the lower percentage increase was due to the fact that 2003 had one more workday ( 252 days ) , those days not falling on a weekend or holiday , than 2002 ( 251 days ) .
containerboard sales volume to external domestic and export customers decreased 6.7% ( 6.7 % ) to 445000 tons for the year ended december 31 , 2003 from 477000 tons in the comparable period of 2002 .
income before interest and taxes income before interest and taxes decreased by $ 48.4 million , or 33.3% ( 33.3 % ) , for the year ended december 31 , 2003 compared to 2002 .
included in income before interest and taxes for the twelve months


valuation techniques 2013 cash equivalents are mostly comprised of short-term money-market instruments and are valued at cost , which approximates fair value .
u.s .
equity securities and international equity securities categorized as level 1 are traded on active national and international exchanges and are valued at their closing prices on the last trading day of the year .
for u.s .
equity securities and international equity securities not traded on an active exchange , or if the closing price is not available , the trustee obtains indicative quotes from a pricing vendor , broker or investment manager .
these securities are categorized as level 2 if the custodian obtains corroborated quotes from a pricing vendor or categorized as level 3 if the custodian obtains uncorroborated quotes from a broker or investment manager .
commingled equity funds categorized as level 1 are traded on active national and international exchanges and are valued at their closing prices on the last trading day of the year .
for commingled equity funds not traded on an active exchange , or if the closing price is not available , the trustee obtains indicative quotes from a pricing vendor , broker or investment manager .
these securities are categorized as level 2 if the custodian obtains corroborated quotes from a pricing vendor .
fixed income investments categorized as level 2 are valued by the trustee using pricing models that use verifiable observable market data ( e.g. , interest rates and yield curves observable at commonly quoted intervals and credit spreads ) , bids provided by brokers or dealers or quoted prices of securities with similar characteristics .
fixed income investments are categorized as level 3 when valuations using observable inputs are unavailable .
the trustee typically obtains pricing based on indicative quotes or bid evaluations from vendors , brokers or the investment manager .
in addition , certain other fixed income investments categorized as level 3 are valued using a discounted cash flow approach .
significant inputs include projected annuity payments and the discount rate applied to those payments .
certain commingled equity funds , consisting of equity mutual funds , are valued using the nav .
the nav valuations are based on the underlying investments and typically redeemable within 90 days .
private equity funds consist of partnership and co-investment funds .
the nav is based on valuation models of the underlying securities , which includes unobservable inputs that cannot be corroborated using verifiable observable market data .
these funds typically have redemption periods between eight and 12 years .
real estate funds consist of partnerships , most of which are closed-end funds , for which the nav is based on valuation models and periodic appraisals .
these funds typically have redemption periods between eight and 10 years .
hedge funds consist of direct hedge funds for which the nav is generally based on the valuation of the underlying investments .
redemptions in hedge funds are based on the specific terms of each fund , and generally range from a minimum of one month to several months .
contributions and expected benefit payments the funding of our qualified defined benefit pension plans is determined in accordance with erisa , as amended by the ppa , and in a manner consistent with cas and internal revenue code rules .
we made contributions of $ 5.0 billion to our qualified defined benefit pension plans in 2018 , including required and discretionary contributions .
as a result of these contributions , we do not expect to make contributions to our qualified defined benefit pension plans in 2019 .
the following table presents estimated future benefit payments , which reflect expected future employee service , as of december 31 , 2018 ( in millions ) : .

                                         | 2019   | 2020   | 2021   | 2022   | 2023   | 2024 2013 2028
---------------------------------------- | ------ | ------ | ------ | ------ | ------ | --------------
qualified defined benefit pension plans  | $ 2350 | $ 2390 | $ 2470 | $ 2550 | $ 2610 | $ 13670
retiree medical and life insurance plans | 170    | 180    | 180    | 180    | 170    | 810

defined contribution plans we maintain a number of defined contribution plans , most with 401 ( k ) features , that cover substantially all of our employees .
under the provisions of our 401 ( k ) plans , we match most employees 2019 eligible contributions at rates specified in the plan documents .
our contributions were $ 658 million in 2018 , $ 613 million in 2017 and $ 617 million in 2016 , the majority of which were funded using our common stock .
our defined contribution plans held approximately 33.3 million and 35.5 million shares of our common stock as of december 31 , 2018 and 2017.


consumer foods net sales increased $ 303 million , or 5% ( 5 % ) , for the year to $ 6.8 billion .
results reflect an increase of three percentage points from improved net pricing and product mix and two percentage points of improvement from higher volumes .
net pricing and volume improvements were achieved in many of the company 2019s priority investment and enabler brands .
the impact of product recalls partially offset these improvements .
the company implemented significant price increases for many consumer foods products during the fourth quarter of fiscal 2008 .
continued net sales improvements are expected into fiscal 2009 when the company expects to receive the benefit of these pricing actions for full fiscal periods .
sales of some of the company 2019s most significant brands , including chef boyardee ae , david ae , egg beaters ae , healthy choice ae , hebrew national ae , hunt 2019s ae , marie callender 2019s ae , manwich ae , orville redenbacher 2019s ae , pam ae , ro*tel ae , rosarita ae , snack pack ae , swiss miss ae , wesson ae , and wolf ae grew in fiscal 2008 .
sales of act ii ae , andy capp ae , banquet ae , crunch 2018n munch ae , kid cuisine ae , parkay ae , pemmican ae , reddi-wip ae , and slim jim ae declined in fiscal 2008 .
net sales in the consumer foods segment are not comparable across periods due to a variety of factors .
the company initiated a peanut butter recall in the third quarter of fiscal 2007 and reintroduced peter pan ae peanut butter products in august 2007 .
sales of all peanut butter products , including both branded and private label , in fiscal 2008 were $ 14 million lower than comparable amounts in fiscal 2007 .
consumer foods net sales were also adversely impacted by the recall of banquet ae and private label pot pies in the second quarter of fiscal 2008 .
net sales of pot pies were lower by approximately $ 22 million in fiscal 2008 , relative to fiscal 2007 , primarily due to product returns and lost sales of banquet ae and private label pot pies .
sales from alexia foods and lincoln snacks , businesses acquired in fiscal 2008 , totaled $ 66 million in fiscal 2008 .
the company divested a refrigerated pizza business during the first half of fiscal 2007 .
sales from this business were $ 17 million in fiscal food and ingredients net sales were $ 4.1 billion in fiscal 2008 , an increase of $ 706 million , or 21% ( 21 % ) .
increased sales are reflective of higher sales prices in the company 2019s milling operations due to higher grain prices , and price and volume increases in the company 2019s potato and dehydrated vegetable operations .
the fiscal 2007 divestiture of an oat milling operation resulted in a reduction of sales of $ 27 million for fiscal 2008 , partially offset by increased sales of $ 18 million from the acquisition of watts brothers in february 2008 .
international foods net sales increased $ 65 million to $ 678 million .
the strengthening of foreign currencies relative to the u.s .
dollar accounted for approximately $ 36 million of this increase .
the segment achieved a 5% ( 5 % ) increase in sales volume in fiscal 2008 , primarily reflecting increased unit sales in canada and mexico , and modest increases in net pricing .
gross profit ( net sales less cost of goods sold ) ( $ in millions ) reporting segment fiscal 2008 gross profit fiscal 2007 gross profit % (  % ) increase/ ( decrease ) .

reporting segment    | fiscal 2008 gross profit | fiscal 2007 gross profit | % (  % ) increase/ ( decrease )
-------------------- | ------------------------ | ------------------------ | -------------------------------
consumer foods       | $ 1802                   | $ 1923                   | ( 6 ) % (  % )
food and ingredients | 724                      | 590                      | 23% ( 23 % )
international foods  | 190                      | 180                      | 6% ( 6 % )
total                | $ 2716                   | $ 2693                   | 1% ( 1 % )

the company 2019s gross profit for fiscal 2008 was $ 2.7 billion , an increase of $ 23 million , or 1% ( 1 % ) , over the prior year .
the increase in gross profit was largely driven by results in the food and ingredients segment , reflecting higher margins in the company 2019s milling and specialty potato operations , largely offset by reduced gross profits in the consumer foods segment .
costs of implementing the company 2019s restructuring plans reduced gross profit by $ 4 million and $ 46 million in fiscal 2008 and fiscal 2007 , respectively.


entergy corporation and subsidiaries management 2019s financial discussion and analysis palisades plants and related assets to their fair values .
see note 14 to the financial statements for further discussion of the impairment and related charges .
as a result of the entergy louisiana and entergy gulf states louisiana business combination , results of operations for 2015 also include two items that occurred in october 2015 : 1 ) a deferred tax asset and resulting net increase in tax basis of approximately $ 334 million and 2 ) a regulatory liability of $ 107 million ( $ 66 million net-of-tax ) as a result of customer credits to be realized by electric customers of entergy louisiana , consistent with the terms of the stipulated settlement in the business combination proceeding .
see note 2 to the financial statements for further discussion of the business combination and customer credits .
results of operations for 2015 also include the sale in december 2015 of the 583 mw rhode island state energy center for a realized gain of $ 154 million ( $ 100 million net-of-tax ) on the sale and the $ 77 million ( $ 47 million net-of-tax ) write-off and regulatory charges to recognize that a portion of the assets associated with the waterford 3 replacement steam generator project is no longer probable of recovery .
see note 14 to the financial statements for further discussion of the rhode island state energy center sale .
see note 2 to the financial statements for further discussion of the waterford 3 write-off .
net revenue utility following is an analysis of the change in net revenue comparing 2016 to 2015 .
amount ( in millions ) .

                                                | amount ( in millions )
----------------------------------------------- | ----------------------
2015 net revenue                                | $ 5829
retail electric price                           | 289
louisiana business combination customer credits | 107
volume/weather                                  | 14
louisiana act 55 financing savings obligation   | -17 ( 17 )
other                                           | -43 ( 43 )
2016 net revenue                                | $ 6179

the retail electric price variance is primarily due to : 2022 an increase in base rates at entergy arkansas , as approved by the apsc .
the new rates were effective february 24 , 2016 and began billing with the first billing cycle of april 2016 .
the increase includes an interim base rate adjustment surcharge , effective with the first billing cycle of april 2016 , to recover the incremental revenue requirement for the period february 24 , 2016 through march 31 , 2016 .
a significant portion of the increase is related to the purchase of power block 2 of the union power station ; 2022 an increase in the purchased power and capacity acquisition cost recovery rider for entergy new orleans , as approved by the city council , effective with the first billing cycle of march 2016 , primarily related to the purchase of power block 1 of the union power station ; 2022 an increase in formula rate plan revenues for entergy louisiana , implemented with the first billing cycle of march 2016 , to collect the estimated first-year revenue requirement related to the purchase of power blocks 3 and 4 of the union power station ; and 2022 an increase in revenues at entergy mississippi , as approved by the mpsc , effective with the first billing cycle of july 2016 , and an increase in revenues collected through the storm damage rider .
see note 2 to the financial statements for further discussion of the rate proceedings .
see note 14 to the financial statements for discussion of the union power station purchase .
the louisiana business combination customer credits variance is due to a regulatory liability of $ 107 million recorded by entergy in october 2015 as a result of the entergy gulf states louisiana and entergy louisiana business


table of contents part ii , item 8 schlumberger limited ( schlumberger n.v. , incorporated in the netherlands antilles ) and subsidiary companies shares of common stock issued treasury shares outstanding .

                             | issued    | in treasury            | shares outstanding
---------------------------- | --------- | ---------------------- | ------------------
balance january 1 2001       | 667085793 | -94361099 ( 94361099 ) | 572724694
employee stock purchase plan | 2013      | 1752833                | 1752833
shares granted to directors  | 2013      | 4800                   | 4800
shares sold to optionees     | 8385      | 1399686                | 1408071
balance december 31 2001     | 667094178 | -91203780 ( 91203780 ) | 575890398
employee stock purchase plan | 2013      | 2677842                | 2677842
shares granted to directors  | 2013      | 3500                   | 3500
shares sold to optionees     | 10490     | 2243400                | 2253890
acquisition of technoguide   | 2013      | 1347485                | 1347485
balance december 31 2002     | 667104668 | -84931553 ( 84931553 ) | 582173115
employee stock purchase plan | 2013      | 2464088                | 2464088
shares granted to directors  | 2013      | 3500                   | 3500
shares sold to optionees     | 1320      | 1306305                | 1307625
balance december 31 2003     | 667105988 | -81157660 ( 81157660 ) | 585948328

see the notes to consolidated financial statements 39 / slb 2003 form 10-k