| _id | dd4b892a8 |
| title |  |
| text | foreign currency exchange rate risk many of our non-u.s .
companies maintain both assets and liabilities in local currencies .
therefore , foreign exchange rate risk is generally limited to net assets denominated in those foreign currencies .
foreign exchange rate risk is reviewed as part of our risk management process .
locally required capital levels are invested in home currencies in order to satisfy regulatory require- ments and to support local insurance operations regardless of currency fluctuations .

the principal currencies creating foreign exchange risk for us are the british pound sterling , the euro , and the canadian dollar .
the following table provides more information on our exposure to foreign exchange rate risk at december 31 , 2008 and 2007. .

reinsurance of gmdb and gmib guarantees our net income is directly impacted by changes in the reserves calculated in connection with the reinsurance of variable annuity guarantees , primarily gmdb and gmib .
these reserves are calculated in accordance with sop 03-1 ( sop reserves ) and changes in these reserves are reflected as life and annuity benefit expense , which is included in life underwriting income .

in addition , our net income is directly impacted by the change in the fair value of the gmib liability ( fvl ) , which is classified as a derivative according to fas 133 .
the fair value liability established for a gmib reinsurance contract represents the differ- ence between the fair value of the contract and the sop 03-1 reserves .
changes in the fair value of the gmib liability , net of associated changes in the calculated sop 03-1 reserve , are reflected as realized gains or losses .

ace views our variable annuity reinsurance business as having a similar risk profile to that of catastrophe reinsurance , with the probability of long-term economic loss relatively small at the time of pricing .
adverse changes in market factors and policyholder behavior will have an impact on both life underwriting income and net income .

when evaluating these risks , we expect to be compensated for taking both the risk of a cumulative long-term economic net loss , as well as the short-term accounting variations caused by these market movements .
therefore , we evaluate this business in terms of its long-term eco- nomic risk and reward .
the ultimate risk to the variable annuity guaranty reinsurance business is a long-term underperformance of investment returns , which can be exacerbated by a long-term reduction in interest rates .

following a market downturn , continued market underperformance over a period of five to seven years would eventually result in a higher level of paid claims as policyholders accessed their guarantees through death or annuitization .
however , if market conditions improved following a downturn , sop 03-1 reserves and fair value liability would fall reflecting a decreased likelihood of future claims , which would result in an increase in both life underwriting income and net income .

as of december 31 , 2008 , management established the sop 03-1 reserve based on the benefit ratio calculated using actual market values at december 31 , 2008 .
management exercises judgment in determining the extent to which short-term market movements impact the sop 03-1 reserve .
the sop 03-1 reserve is based on the calculation of a long-term benefit ratio ( or loss ratio ) for the variable annuity guarantee reinsurance .

despite the long-term nature of the risk the benefit ratio calculation is impacted by short-term market movements that may be judged by management to be temporary or transient .

management will , in keeping with the language in sop 03-1 , regularly examine both quantitative and qualitative analysis and management will determine if , in its judgment , the change in the calculated benefit ratio is of sufficient magnitude and has persisted for a sufficient duration to warrant a change in the benefit ratio used to establish the sop 03-1 reserve .

this has no impact on either premium received or claims paid nor does it impact the long-term profit or loss of the variable annuity guaran- tee reinsurance .
the sop 03-1 reserve and fair value liability calculations are directly affected by market factors , including equity levels , interest rate levels , credit risk and implied volatilities , as well as policyholder behaviors , such as annuitization and lapse rates .

the table below shows the sensitivity , as of december 31 , 2008 , of the sop 03-1 reserves and fair value liability associated with the variable annuity guarantee reinsurance portfolio .
in addition , the tables below show the sensitivity of the fair value of specific derivative instruments held ( hedge value ) , which includes instruments purchased in january 2009 , to partially offset the risk in the variable annuity guarantee reinsurance portfolio .

although these derivatives do not receive hedge accounting treatment , some portion of the change in value may be used to offset changes in the sop 03-1 reserve.

 |
| table | ( in millions of u.s . dollars )                                                      | 2008           | 2007
------------------------------------------------------------------------------------- | -------------- | --------------
fair value of net assets denominated in foreign currencies                            | $ 1127         | $ 1651
percentage of fair value of total net assets                                          | 7.8% ( 7.8 % ) | 9.9% ( 9.9 % )
pre-tax impact on equity of hypothetical 10 percent strengthening of the u.s . dollar | $ 84           | $ 150 |


| _id | dd4bd2f20 |
| title |  |
| text | table of contents cdw corporation and subsidiaries method or straight-line method , as applicable .
the company classifies deferred financing costs as a direct deduction from the carrying value of the long-term debt liability on the consolidated balance sheets , except for deferred financing costs associated with revolving credit facilities which are presented as an asset , within other assets on the consolidated balance sheets .

derivative instruments the company has interest rate cap agreements for the purpose of hedging its exposure to fluctuations in interest rates .
the interest rate cap agreements are designated as cash flow hedges of interest rate risk and recorded at fair value in other assets on the consolidated balance sheets .

the gain or loss on the derivative instruments is reported as a component of accumulated other comprehensive loss until reclassified to interest expense in the same period the hedge transaction affects earnings .
fair value measurements fair value is defined under gaap as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date .

a fair value hierarchy has been established for valuation inputs to prioritize the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market .
each fair value measurement is reported in one of the three levels which is determined by the lowest level input that is significant to the fair value measurement in its entirety .
these levels are : level 1 2013 observable inputs such as quoted prices for identical instruments traded in active markets .

level 2 2013 inputs are based on quoted prices for similar instruments in active markets , quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities .

level 3 2013 inputs are generally unobservable and typically reflect management 2019s estimates of assumptions that market participants would use in pricing the asset or liability .
the fair values are therefore determined using model-based techniques that include option pricing models , discounted cash flow models and similar techniques .
accumulated other comprehensive loss the components of accumulated other comprehensive loss included in stockholders 2019 equity are as follows: .

revenue recognition the company is a primary distribution channel for a large group of vendors and suppliers , including original equipment manufacturers ( 201coems 201d ) , software publishers , wholesale distributors and cloud providers .

the company records revenue from sales transactions when title and risk of loss are passed to the customer , there is persuasive evidence of an arrangement for sale , delivery has occurred and/or services have been rendered , the sales price is fixed or determinable , and collectability is reasonably assured .
the company 2019s shipping terms typically specify f.o.b .
destination , at which time title and risk of loss have passed to the customer .

revenues from the sales of hardware products and software licenses are generally recognized on a gross basis with the selling price to the customer recorded as sales and the acquisition cost of the product recorded as cost of sales .
these items can be delivered to customers in a variety of ways , including ( i ) as physical product shipped from the company 2019s warehouse , ( ii ) via drop-shipment by the vendor or supplier , or ( iii ) via electronic delivery for software licenses .

at the time of sale , the company records an estimate for sales returns and allowances based on historical experience .
the company 2019s vendor partners warrant most of the products the company sells .
the company leverages drop-shipment arrangements with many of its vendors and suppliers to deliver products to its customers without having to physically hold the inventory at its warehouses , thereby increasing efficiency and reducing

 |
| table | ( in millions )                       | years ended december 31 , 2017 | years ended december 31 , 2016 | years ended december 31 , 2015
------------------------------------- | ------------------------------ | ------------------------------ | ------------------------------
foreign currency translation          | $ -96.1 ( 96.1 )               | $ -139.6 ( 139.6 )             | $ -61.1 ( 61.1 )
unrealized gain from hedge accounting | 0.2                            | 2014                           | 2014
accumulated other comprehensive loss  | $ -95.9 ( 95.9 )               | $ -139.6 ( 139.6 )             | $ -61.1 ( 61.1 ) |


| _id | dd4c1e9ca |
| title |  |
| text | capital resources and liquidity capital resources overview capital has historically been generated by earnings from citi 2019s operating businesses .
citi may also augment its capital through issuances of common stock , convertible preferred stock , preferred stock , equity issued through awards under employee benefit plans , and , in the case of regulatory capital , through the issuance of subordinated debt underlying trust preferred securities .

in addition , the impact of future events on citi 2019s business results , such as corporate and asset dispositions , as well as changes in accounting standards , also affect citi 2019s capital levels .
generally , capital is used primarily to support assets in citi 2019s businesses and to absorb market , credit , or operational losses .

while capital may be used for other purposes , such as to pay dividends or repurchase common stock , citi 2019s ability to utilize its capital for these purposes is currently restricted due to its agreements with the u.s .
government , generally for so long as the u.s .
government continues to hold citi 2019s common stock or trust preferred securities .
see also 201csupervision and regulation 201d below .

citigroup 2019s capital management framework is designed to ensure that citigroup and its principal subsidiaries maintain sufficient capital consistent with citi 2019s risk profile and all applicable regulatory standards and guidelines , as well as external rating agency considerations .
the capital management process is centrally overseen by senior management and is reviewed at the consolidated , legal entity , and country level .

senior management is responsible for the capital management process mainly through citigroup 2019s finance and asset and liability committee ( finalco ) , with oversight from the risk management and finance committee of citigroup 2019s board of directors .
the finalco is composed of the senior-most management of citigroup for the purpose of engaging management in decision-making and related discussions on capital and liquidity matters .

among other things , finalco 2019s responsibilities include : determining the financial structure of citigroup and its principal subsidiaries ; ensuring that citigroup and its regulated entities are adequately capitalized in consultation with its regulators ; determining appropriate asset levels and return hurdles for citigroup and individual businesses ; reviewing the funding and capital markets plan for citigroup ; and monitoring interest rate risk , corporate and bank liquidity , and the impact of

corporate and bank liquidity , and the impact of currency translation on non-u.s .

earnings and capital .
capital ratios citigroup is subject to the risk-based capital guidelines issued by the federal reserve board .
historically , capital adequacy has been measured , in part , based on two risk-based capital ratios , the tier 1 capital and total capital ( tier 1 capital + tier 2 capital ) ratios .

tier 1 capital consists of the sum of 201ccore capital elements , 201d such as qualifying common stockholders 2019 equity , as adjusted , qualifying noncontrolling interests , and qualifying mandatorily redeemable securities of subsidiary trusts , principally reduced by goodwill , other disallowed intangible assets , and disallowed deferred tax assets .

total capital also includes 201csupplementary 201d tier 2 capital elements , such as qualifying subordinated debt and a limited portion of the allowance for credit losses .
both measures of capital adequacy are stated as a percentage of risk-weighted assets .
further , in conjunction with the conduct of the 2009 supervisory capital assessment program ( scap ) , u.s .

banking regulators developed a new measure of capital termed 201ctier 1 common , 201d which has been defined as tier 1 capital less non-common elements , including qualifying perpetual preferred stock , qualifying noncontrolling interests , and qualifying mandatorily redeemable securities of subsidiary trusts .
citigroup 2019s risk-weighted assets are principally derived from application of the risk-based capital guidelines related to the measurement of credit risk .

pursuant to these guidelines , on-balance-sheet assets and the credit equivalent amount of certain off-balance-sheet exposures ( such as financial guarantees , unfunded lending commitments , letters of credit , and derivatives ) are assigned to one of several prescribed risk-weight categories based upon the perceived credit risk associated with the obligor , or if relevant , the guarantor , the nature of the collateral , or external credit ratings .

risk-weighted assets also incorporate a measure for market risk on covered trading account positions and all foreign exchange and commodity positions whether or not carried in the trading account .
excluded from risk-weighted assets are any assets , such as goodwill and deferred tax assets , to the extent required to be deducted from regulatory capital .
see 201ccomponents of capital under regulatory guidelines 201d below .

citigroup is also subject to a leverage ratio requirement , a non-risk-based measure of capital adequacy , which is defined as tier 1 capital as a percentage of quarterly adjusted average total assets .

to be 201cwell capitalized 201d under federal bank regulatory agency definitions , a bank holding company must have a tier 1 capital ratio of at least 6% ( 6 % ) , a total capital ratio of at least 10% ( 10 % ) , and a leverage ratio of at least 3% ( 3 % ) , and not be subject to a federal reserve board directive to maintain higher capital levels .
the following table sets forth citigroup 2019s regulatory capital ratios as of december 31 , 2009 and december 31 , 2008 .
citigroup regulatory capital ratios .

as noted in the table above , citigroup was 201cwell capitalized 201d under the federal bank regulatory agency definitions at year end for both 2009 and 2008.

 |
| table | at year end                                         | 2009             | 2008
--------------------------------------------------- | ---------------- | ----------------
tier 1 common                                       | 9.60% ( 9.60 % ) | 2.30% ( 2.30 % )
tier 1 capital                                      | 11.67            | 11.92
total capital ( tier 1 capital and tier 2 capital ) | 15.25            | 15.70
leverage                                            | 6.89             | 6.08 |


| _id | dd4c11964 |
| title |  |
| text | jpmorgan chase & co./2018 form 10-k 117 lending-related commitments the firm uses lending-related financial instruments , such as commitments ( including revolving credit facilities ) and guarantees , to address the financing needs of its clients .

the contractual amounts of these financial instruments represent the maximum possible credit risk should the clients draw down on these commitments or the firm fulfill its obligations under these guarantees , and the clients subsequently fail to perform according to the terms of these contracts .
most of these commitments and guarantees are refinanced , extended , cancelled , or expire without being drawn upon or a default occurring .

in the firm 2019s view , the total contractual amount of these wholesale lending-related commitments is not representative of the firm 2019s expected future credit exposure or funding requirements .
for further information on wholesale lending-related commitments , refer to note 27 .
clearing services the firm provides clearing services for clients entering into certain securities and derivative contracts .

through the provision of these services the firm is exposed to the risk of non-performance by its clients and may be required to share in losses incurred by ccps .
where possible , the firm seeks to mitigate its credit risk to its clients through the collection of adequate margin at inception and throughout the life of the transactions and can also cease provision of clearing services if clients do not adhere to their obligations under the clearing agreement .

for further discussion of clearing services , refer to note 27 .
derivative contracts derivatives enable clients and counterparties to manage risks including credit risk and risks arising from fluctuations in interest rates , foreign exchange , equities , and commodities .

the firm makes markets in derivatives in order to meet these needs and uses derivatives to manage certain risks associated with net open risk positions from its market-making activities , including the counterparty credit risk arising from derivative receivables .
the firm also uses derivative instruments to manage its own credit and other market risk exposure .
the nature of the counterparty and the settlement mechanism of the derivative affect the credit risk to which the firm is exposed .

for otc derivatives the firm is exposed to the credit risk of the derivative counterparty .
for exchange-traded derivatives ( 201cetd 201d ) , such as futures and options , and 201ccleared 201d over-the-counter ( 201cotc-cleared 201d ) derivatives , the firm is generally exposed to the credit risk of the relevant ccp .

where possible , the firm seeks to mitigate its credit risk exposures arising from derivative contracts through the use of legally enforceable master netting arrangements and collateral agreements .
for a further discussion of derivative contracts , counterparties and settlement types , refer to note 5 .
the following table summarizes the net derivative receivables for the periods presented .
derivative receivables .

( a ) includes collateral related to derivative instruments where appropriate legal opinions have not been either sought or obtained with respect to master netting agreements .
the fair value of derivative receivables reported on the consolidated balance sheets were $ 54.2 billion and $ 56.5 billion at december 31 , 2018 and 2017 , respectively .

derivative receivables represent the fair value of the derivative contracts after giving effect to legally enforceable master netting agreements and cash collateral held by the firm .
however , in management 2019s view , the appropriate measure of current credit risk should also take into consideration additional liquid securities ( primarily u.s .

government and agency securities and other group of seven nations ( 201cg7 201d ) government securities ) and other cash collateral held by the firm aggregating $ 15.3 billion and $ 16.1 billion at december 31 , 2018 and 2017 , respectively , that may be used as security when the fair value of the client 2019s exposure is in the firm 2019s favor .

in addition to the collateral described in the preceding paragraph , the firm also holds additional collateral ( primarily cash , g7 government securities , other liquid government-agency and guaranteed securities , and corporate debt and equity securities ) delivered by clients at the initiation of transactions , as well as collateral related to contracts that have a non-daily call frequency and collateral that the firm has agreed to return but has not yet settled as of the reporting date .

although this collateral does not reduce the balances and is not included in the table above , it is available as security against potential exposure that could arise should the fair value of the client 2019s derivative contracts move in the firm 2019s favor .
the derivative receivables fair value , net of all collateral , also does not include other credit enhancements , such as letters of credit .
for additional information on the firm 2019s use of collateral agreements , refer to note 5 .

while useful as a current view of credit exposure , the net fair value of the derivative receivables does not capture the potential future variability of that credit exposure .
to capture the potential future variability of credit exposure , the firm calculates , on a client-by-client basis , three measures of potential derivatives-related credit loss : peak , derivative risk equivalent ( 201cdre 201d ) , and average exposure ( 201cavg 201d ) .

these measures all incorporate netting and collateral benefits , where applicable .
peak represents a conservative measure of potential exposure to a counterparty calculated in a manner that is broadly equivalent to a 97.5% ( 97.5 % ) confidence level over the life of the transaction .
peak is the primary measure used by the firm for setting of credit limits for derivative contracts , senior management reporting and derivatives exposure management .

dre exposure is a measure that expresses the risk of derivative exposure on a basis intended to be

 |
| table | december 31 ( in millions )                                                           | 2018             | 2017
------------------------------------------------------------------------------------- | ---------------- | ----------------
total net of cash collateral                                                          | $ 54213          | $ 56523
liquid securities and other cash collateral held against derivative receivables ( a ) | -15322 ( 15322 ) | -16108 ( 16108 )
total net of all collateral                                                           | $ 38891          | $ 40415 |


| _id | dd497a67e |
| title |  |
| text | inventory on hand , as well as our future purchase commitments with our suppliers , considering multiple factors , including demand forecasts , product life cycle , current sales levels , pricing strategy and cost trends .
if our review indicates that inventories of raw materials , components or finished products have become obsolete or are in excess of anticipated demand or that inventory cost exceeds net realizable value , we may be required to make adjustments that will impact the results of operations .

goodwill and non-amortizable intangible assets valuation - we test goodwill and non-amortizable intangible assets for impairment annually or more frequently if events occur that would warrant such review .
while the company has the option to perform a qualitative assessment for both goodwill and non-amortizable intangible assets to determine if it is more likely than not that an impairment exists , the company elects to perform the quantitative assessment for our annual impairment analysis .

the impairment analysis involves comparing the fair value of each reporting unit or non-amortizable intangible asset to the carrying value .
if the carrying value exceeds the fair value , goodwill or a non-amortizable intangible asset is considered impaired .
to determine the fair value of goodwill , we primarily use a discounted cash flow model , supported by the market approach using earnings multiples of comparable global and local companies within the tobacco industry .

at december 31 , 2018 , the carrying value of our goodwill was $ 7.2 billion , which is related to ten reporting units , each of which consists of a group of markets with similar economic characteristics .
the estimated fair value of each of our ten reporting units exceeded the carrying value as of december 31 , 2018 .
to determine the fair value of non-amortizable intangible assets , we primarily use a discounted cash flow model applying the relief-from-royalty method .

we concluded that the fair value of our non- amortizable intangible assets exceeded the carrying value .
these discounted cash flow models include management assumptions relevant for forecasting operating cash flows , which are subject to changes in business conditions , such as volumes and prices , costs to produce , discount rates and estimated capital needs .

management considers historical experience and all available information at the time the fair values are estimated , and we believe these assumptions are consistent with the assumptions a hypothetical marketplace participant would use .
since the march 28 , 2008 , spin-off from altria group , inc. , we have not recorded a charge to earnings for an impairment of goodwill or non-amortizable intangible assets .

marketing costs - we incur certain costs to support our products through programs that include advertising , marketing , consumer engagement and trade promotions .
the costs of our advertising and marketing programs are expensed in accordance with u.s .
gaap .
recognition of the cost related to our consumer engagement and trade promotion programs contain uncertainties due to the judgment required in estimating the potential performance and compliance for each program .

for volume-based incentives provided to customers , management continually assesses and estimates , by customer , the likelihood of the customer's achieving the specified targets , and records the reduction of revenue as the sales are made .
for other trade promotions , management relies on estimated utilization rates that have been developed from historical experience .

changes in the assumptions used in estimating the cost of any individual marketing program would not result in a material change in our financial position , results of operations or operating cash flows .
employee benefit plans - as discussed in item 8 , note 13 .
benefit plans to our consolidated financial statements , we provide a range of benefits to our employees and retired employees , including pensions , postretirement health care and postemployment benefits ( primarily severance ) .

we record annual amounts relating to these plans based on calculations specified by u.s .
gaap .
these calculations include various actuarial assumptions , such as discount rates , assumed rates of return on plan assets , compensation increases , mortality , turnover rates and health care cost trend rates .
we review actuarial assumptions on an annual basis and make modifications to the assumptions based on current rates and trends when it is deemed appropriate to do so .
as permitted by u.s .

as permitted by u.s .
gaap , any effect of the modifications is generally amortized over future periods .
we believe that the assumptions utilized in calculating our obligations under these plans are reasonable based upon our historical experience and advice from our actuaries .
weighted-average discount rate assumptions for pension and postretirement plan obligations at december 31 , 2018 and 2017 are as follows: .

we anticipate that assumption changes will increase 2019 pre-tax pension and postretirement expense to approximately $ 205 million as compared with approximately $ 160 million in 2018 , excluding amounts related to employee severance and early retirement programs .

the anticipated increase is primarily due to higher amortization out of other comprehensive earnings for unrecognized actuarial gains/ losses of $ 14 million , coupled with lower return on assets of $ 16 million , higher interest and service cost of $ 12 million and $ 4 million respectively , partially offset by other movements of $ 1 million .
weighted-average expected rate of return and discount rate assumptions have a significant effect on the amount of expense reported for the employee benefit plans .

a fifty-basis-point decrease in our discount rate would increase our 2019 pension and postretirement expense by approximately $ 50 million , and a fifty-basis-point increase in our discount rate would decrease our 2019 pension and postretirement

 |
| table | | 2018             | 2017
-------------------- | ---------------- | ----------------
pension plans        | 1.61% ( 1.61 % ) | 1.51% ( 1.51 % )
postretirement plans | 3.97% ( 3.97 % ) | 3.79% ( 3.79 % ) |


| _id | dd497bd08 |
| title |  |
| text | item 1b .
unresolved staff comments .
item 2 .
properties .
our corporate co-headquarters are located in pittsburgh , pennsylvania and chicago , illinois .
our co-headquarters are leased and house our executive offices , certain u.s .
business units , and our administrative , finance , and human resource functions .
we maintain additional owned and leased offices throughout the regions in which we operate .

we manufacture our products in our network of manufacturing and processing facilities located throughout the world .
as of december 31 , 2016 , we operated 87 manufacturing and processing facilities .
we own 83 and lease four of these facilities .
our manufacturing and processing facilities count by segment as of december 31 , 2016 was: .

we maintain all of our manufacturing and processing facilities in good condition and believe they are suitable and are adequate for our present needs .
we also enter into co-manufacturing arrangements with third parties if we determine it is advantageous to outsource the production of any of our products .
in the fourth quarter of 2016 , we reorganized our segment structure to move our russia business from the rest of world segment to the europe segment .

we have reflected this change in the table above .
see note 18 , segment reporting , to the consolidated financial statements for additional information .
several of our current manufacturing and processing facilities are scheduled to be closed within the next year .
see note 3 , integration and restructuring expenses , to the consolidated financial statements for additional information .
item 3 .
legal proceedings .

item 3 .
legal proceedings .
we are routinely involved in legal proceedings , claims , and governmental inquiries , inspections or investigations ( 201clegal matters 201d ) arising in the ordinary course of our business .
on april 1 , 2015 , the commodity futures trading commission ( 201ccftc 201d ) filed a formal complaint against mondel 0113z international ( formerly known as kraft foods inc. ) and kraft in the u.s .

district court for the northern district of illinois , eastern division , related to activities involving the trading of december 2011 wheat futures contracts .
the complaint alleges that mondel 0113z international and kraft ( 1 ) manipulated or attempted to manipulate the wheat markets during the fall of 2011 , ( 2 ) violated position limit levels for wheat futures , and ( 3 ) engaged in non-competitive trades by trading both sides of exchange-for-physical chicago board of trade wheat contracts .

as previously disclosed by kraft , these activities arose prior to the october 1 , 2012 spin-off of kraft by mondel 0113z international to its shareholders and involve the business now owned and operated by mondel 0113z international or its affiliates .

the separation and distribution agreement between kraft and mondel 0113z international , dated as of september 27 , 2012 , governs the allocation of liabilities between mondel 0113z international and kraft and , accordingly , mondel 0113z international will predominantly bear the costs of this matter and any monetary penalties or other payments that the cftc may impose .
we do not expect this matter to have a material adverse effect on our financial condition , results of operations , or business .

while we cannot predict with certainty the results of legal matters in which we are currently involved or may in the future be involved , we do not expect that the ultimate costs to resolve any of the legal matters that are currently pending will have a material adverse effect on our financial condition or results of operations .
item 4 .
mine safety disclosures .
not applicable.

 |
| table | | owned | leased
------------- | ----- | ------
united states | 43    | 2
canada        | 3     | 2014
europe        | 11    | 2014
rest of world | 26    | 2 |


| _id | dd4b9ff3a |
| title |  |
| text | hr solutions .

in october 2010 , we completed the acquisition of hewitt , one of the world 2019s leading human resource consulting and outsourcing companies .
hewitt operates globally together with aon 2019s existing consulting and outsourcing operations under the newly created aon hewitt brand .
hewitt 2019s operating results are included in aon 2019s results of operations beginning october 1 , 2010 .

our hr solutions segment generated approximately 25% ( 25 % ) of our consolidated total revenues in 2010 and provides a broad range of human capital services , as follows : consulting services : 2022 health and benefits advises clients about how to structure , fund , and administer employee benefit programs that attract , retain , and motivate employees .

benefits consulting includes health and welfare , executive benefits , workforce strategies and productivity , absence management , benefits administration , data-driven health , compliance , employee commitment , investment advisory and elective benefits services .
2022 retirement specializes in global actuarial services , defined contribution consulting , investment consulting , tax and erisa consulting , and pension administration .

2022 compensation focuses on compensatory advisory/counsel including : compensation planning design , executive reward strategies , salary survey and benchmarking , market share studies and sales force effectiveness , with special expertise in the financial services and technology industries .

2022 strategic human capital delivers advice to complex global organizations on talent , change and organizational effectiveness issues , including talent strategy and acquisition , executive on-boarding , performance management , leadership assessment and development , communication strategy , workforce training and change management .

outsourcing services : 2022 benefits outsourcing applies our hr expertise primarily through defined benefit ( pension ) , defined contribution ( 401 ( k ) ) , and health and welfare administrative services .
our model replaces the resource-intensive processes once required to administer benefit plans with more efficient , effective , and less costly solutions .

2022 human resource business processing outsourcing ( 2018 2018hr bpo 2019 2019 ) provides market-leading solutions to manage employee data ; administer benefits , payroll and other human resources processes ; and record and manage talent , workforce and other core hr process transactions as well as other complementary services such as absence management , flexible spending , dependent audit and participant advocacy .

beginning in late 2008 , the disruption in the global credit markets and the deterioration of the financial markets created significant uncertainty in the marketplace .
weak economic conditions globally continued throughout 2010 .
the prolonged economic downturn is adversely impacting our clients 2019 financial condition and therefore the levels of business activities in the industries and geographies where we operate .

while we believe that the majority of our practices are well positioned to manage through this time , these challenges are reducing demand for some of our services and putting

 |
| table | years ended december 31, | 2010             | 2009             | 2008
------------------------ | ---------------- | ---------------- | ----------------
revenue                  | $ 2111           | $ 1267           | $ 1356
operating income         | 234              | 203              | 208
operating margin         | 11.1% ( 11.1 % ) | 16.0% ( 16.0 % ) | 15.3% ( 15.3 % ) |


| _id | dd4bc1c7a |
| title |  |
| text | pipeline transportation 2013 we own a system of pipelines through marathon pipe line llc ( 201cmpl 201d ) and ohio river pipe line llc ( 201corpl 201d ) , our wholly-owned subsidiaries .
our pipeline systems transport crude oil and refined products primarily in the midwest and gulf coast regions to our refineries , our terminals and other pipeline systems .

our mpl and orpl wholly-owned and undivided interest common carrier systems consist of 1737 miles of crude oil lines and 1825 miles of refined product lines comprising 32 systems located in 11 states .
the mpl common carrier pipeline network is one of the largest petroleum pipeline systems in the united states , based on total barrels delivered .

our common carrier pipeline systems are subject to state and federal energy regulatory commission regulations and guidelines , including published tariffs for the transportation of crude oil and refined products .
third parties generated 13 percent of the crude oil and refined product shipments on our mpl and orpl common carrier pipelines in 2009 .
our mpl and orpl common carrier pipelines transported the volumes shown in the following table for each of the last three years .

pipeline barrels handled ( thousands of barrels per day ) 2009 2008 2007 .

we also own 196 miles of private crude oil pipelines and 850 miles of private refined products pipelines , and we lease 217 miles of common carrier refined product pipelines .
we have partial ownership interests in several pipeline companies that have approximately 780 miles of crude oil pipelines and 3600 miles of refined products pipelines , including about 970 miles operated by mpl .

in addition , mpl operates most of our private pipelines and 985 miles of crude oil and 160 miles of natural gas pipelines owned by our e&p segment .
our major refined product pipelines include the owned and operated cardinal products pipeline and the wabash pipeline .
the cardinal products pipeline delivers refined products from kenova , west virginia , to columbus , ohio .
the wabash pipeline system delivers product from robinson , illinois , to various terminals in the area of chicago , illinois .

other significant refined product pipelines owned and operated by mpl extend from : robinson , illinois , to louisville , kentucky ; garyville , louisiana , to zachary , louisiana ; and texas city , texas , to pasadena , texas .

in addition , as of december 31 , 2009 , we had interests in the following refined product pipelines : 2022 65 percent undivided ownership interest in the louisville-lexington system , a petroleum products pipeline system extending from louisville to lexington , kentucky ; 2022 60 percent interest in muskegon pipeline llc , which owns a refined products pipeline extending from griffith , indiana , to north muskegon , michigan ; 2022 50 percent interest in centennial pipeline llc , which owns a refined

in centennial pipeline llc , which owns a refined products system connecting the gulf coast region with the midwest market ; 2022 17 percent interest in explorer pipeline company , a refined products pipeline system extending from the gulf coast to the midwest ; and 2022 6 percent interest in wolverine pipe line company , a refined products pipeline system extending from chicago , illinois , to toledo , ohio .

our major owned and operated crude oil lines run from : patoka , illinois , to catlettsburg , kentucky ; patoka , illinois , to robinson , illinois ; patoka , illinois , to lima , ohio ; lima , ohio to canton , ohio ; samaria , michigan , to detroit , michigan ; and st .
james , louisiana , to garyville , louisiana .
as of december 31 , 2009 , we had interests in the following crude oil pipelines : 2022 51 percent interest in loop llc , the owner and operator of loop , which is the only u.s .

deepwater oil port , located 18 miles off the coast of louisiana , and a crude oil pipeline connecting the port facility to storage caverns and tanks at clovelly , louisiana ; 2022 59 percent interest in locap llc , which owns a crude oil pipeline connecting loop and the capline system;

 |
| table | ( thousands of barrels per day ) | 2009 | 2008 | 2007
-------------------------------- | ---- | ---- | ----
crude oil trunk lines            | 1279 | 1405 | 1451
refined products trunk lines     | 953  | 960  | 1049
total                            | 2232 | 2365 | 2500 |


| _id | dd4bce6be |
| title |  |
| text | n o t e s t o c o n s o l i d a t e d f i n a n c i a l s t a t e m e n t s ( continued ) ace limited and subsidiaries the following table shows changes in the company 2019s stock options for the years ended december 31 , 2008 , 2007 , and number of options weighted average exercise price .

the weighted-average remaining contractual term was 5.8 years for the stock options outstanding and 4.6 years for the stock options exercisable at december 31 , 2008 .
the total intrinsic value was approximately $ 66 million for stock options out- standing and $ 81 million for stock options exercisable at december 31 , 2008 .
the weighted-average fair value for the stock options granted for the year ended december 31 , 2008 was $ 17.60 .

the total intrinsic value for stock options exercised dur- ing the years ended december 31 , 2008 , 2007 , and 2006 , was approximately $ 54 million , $ 44 million , and $ 43 million , respectively .
the amount of cash received during the year ended december 31 , 2008 , from the exercise of stock options was $ 97 million .
restricted stock the company 2019s 2004 ltip also provides for grants of restricted stock .

the company generally grants restricted stock with a 4-year vesting period , based on a graded vesting schedule .
the restricted stock is granted at market close price on the date of grant .
included in the company 2019s share-based compensation expense in the year ended december 31 , 2008 , is a portion of the cost related to the unvested restricted stock granted in the years 2004 to 2008.

 |
| table | | number of options    | weightedaverageexercise price
------------------------------------ | -------------------- | -----------------------------
options outstanding december 31 2005 | 12643761             | $ 36.53
granted                              | 1505215              | $ 56.29
exercised                            | -1982560 ( 1982560 ) | $ 33.69
forfeited                            | -413895 ( 413895 )   | $ 39.71
options outstanding december 31 2006 | 11752521             | $ 39.43
granted                              | 1549091              | $ 56.17
exercised                            | -1830004 ( 1830004 ) | $ 35.73
forfeited                            | -200793 ( 200793 )   | $ 51.66
options outstanding december 31 2007 | 11270815             | $ 42.12
granted                              | 1612507              | $ 60.17
exercised                            | -2650733 ( 2650733 ) | $ 36.25
forfeited                            | -309026 ( 309026 )   | $ 54.31
options outstanding december 31 2008 | 9923563              | $ 46.24 |


| _id | dd49719f2 |
| title |  |
| text | payments ( receipts ) ( in millions ) .

in september 2016 the ferc accepted the february 2016 compliance filing subject to a further compliance filing made in november 2016 .
the further compliance filing was required as a result of an order issued in september 2016 ruling on the january 2016 rehearing requests filed by the lpsc , the apsc , and entergy .
in the order addressing the rehearing requests , the ferc granted the lpsc 2019s rehearing request and directed that interest be calculated on the payment/receipt amounts .

the ferc also granted the apsc 2019s and entergy 2019s rehearing request and ordered the removal of both securitized asset accumulated deferred income taxes and contra-securitization accumulated deferred income taxes from the calculation .
in november 2016 , entergy submitted its compliance filing in response to the ferc 2019s order on rehearing .
the compliance filing included a revised refund calculation of the true-up payments and receipts based on 2009 test year data and interest calculations .

the lpsc protested the interest calculations .
in november 2017 the ferc issued an order rejecting the november 2016 compliance filing .
the ferc determined that the payments detailed in the november 2016 compliance filing did not include adequate interest for the payments from entergy arkansas to entergy louisiana because it did not include interest on the principal portion of the payment that was made in february 2016 .

in december 2017 , entergy recalculated the interest pursuant to the november 2017 order .
as a result of the recalculations , entergy arkansas owed very minor payments to entergy louisiana , entergy mississippi , and entergy new orleans .

2011 rate filing based on calendar year 2010 production costs in may 2011 , entergy filed with the ferc the 2011 rates in accordance with the ferc 2019s orders in the system agreement proceeding . a0 a0several parties intervened in the proceeding at the ferc , including the lpsc , which also filed a protest . a0 a0in july a02011 the ferc a0accepted entergy 2019s proposed rates for filing , a0effective june a01 , a02011 , a0subject to refund .

after an abeyance of the proceeding schedule , in december 2014 the ferc consolidated the 2011 rate filing with the 2012 , 2013 , and 2014 rate filings for settlement and hearing procedures .
see discussion below regarding the consolidated settlement and hearing procedures in connection with this proceeding .

2012 rate filing based on calendar year 2011 production costs in may 2012 , entergy filed with the ferc the 2012 rates in accordance with the ferc 2019s orders in the system agreement proceeding . a0 a0several parties intervened in the proceeding at the ferc , including the lpsc , which also filed a protest . a0 a0in august 2012 the ferc a0accepted entergy 2019s proposed rates for filing , a0effective june a02012 , a0subject to refund .

after an abeyance of the proceeding schedule , in december 2014 the ferc consolidated the 2012 rate filing with the 2011 , 2013 , and 2014 rate filings for settlement and hearing procedures .
see discussion below regarding the consolidated settlement and hearing procedures in connection with this proceeding .
2013 rate filing based on calendar year 2012 production costs in may 2013 , entergy filed with the ferc the 2013 rates in accordance with the ferc 2019s orders in the system agreement proceeding .

several parties intervened in the proceeding at the ferc , including the lpsc , which also filed a protest .
the city council intervened and filed comments related to including the outcome of a related ferc proceeding in the 2013 cost equalization calculation .
in august 2013 the ferc issued an order accepting the 2013 rates , effective june 1 , 2013 , subject to refund .

after an abeyance of the proceeding schedule , in december 2014 the ferc consolidated the 2013 rate filing with the 2011 , 2012 , and 2014 rate filings for settlement and hearing procedures .
entergy corporation and subsidiaries notes to financial statements

 |
| table | | payments ( receipts ) ( in millions )
------------------- | -------------------------------------
entergy arkansas    | $ 2
entergy louisiana   | $ 6
entergy mississippi | ( $ 4 )
entergy new orleans | ( $ 1 )
entergy texas       | ( $ 3 ) |


| _id | dd4c04b4c |
| title |  |
| text | table of contents the following discussion of nonoperating income and expense excludes the results of the merger in order to provide a more meaningful year-over-year comparison .
interest expense , net of capitalized interest decreased $ 249 million in 2014 from 2013 primarily due to a $ 149 million decrease in special charges recognized year-over-year as further described below , as well as refinancing activities that resulted in $ 100 million less interest expense recognized in 2014 .

( 1 ) in 2014 , we recognized $ 33 million of special charges relating to non-cash interest accretion on bankruptcy settlement obligations .
in 2013 , we recognized $ 138 million of special charges relating to post-petition interest expense on unsecured obligations pursuant to the plan and penalty interest related to american 2019s 10.5% ( 10.5 % ) secured notes and 7.50% ( 7.50 % ) senior secured notes .

in addition , in 2013 we recorded special charges of $ 44 million for debt extinguishment costs incurred as a result of the repayment of certain aircraft secured indebtedness , including cash interest charges and non-cash write offs of unamortized debt issuance costs .
( 2 ) as a result of the 2013 refinancing activities and the early extinguishment of american 2019s 7.50% ( 7.50 % ) senior secured notes in 2014 , we recognized $ 100 million less interest expense in 2014 as compared to 2013 .

other nonoperating expense , net in 2014 consisted of $ 114 million of net foreign currency losses , including a $ 43 million special charge for venezuelan foreign currency losses , and $ 56 million in other nonoperating special charges primarily due to early debt extinguishment costs related to the prepayment of our 7.50% ( 7.50 % ) senior secured notes and other indebtedness .
the foreign currency losses were driven primarily by the strengthening of the u.s .

dollar relative to other currencies during 2014 , principally in the latin american market , including a 48% ( 48 % ) decrease in the value of the venezuelan bolivar and a 14% ( 14 % ) decrease in the value of the brazilian real .
other nonoperating expense , net in 2013 consisted principally of net foreign currency losses of $ 56 million and early debt extinguishment charges of $ 29 million .

reorganization items , net reorganization items refer to revenues , expenses ( including professional fees ) , realized gains and losses and provisions for losses that are realized or incurred as a direct result of the chapter 11 cases .
the following table summarizes the components included in reorganization items , net on aag 2019s consolidated statement of operations for the year ended december 31 , 2013 ( in millions ) : .

( 1 ) in exchange for employees 2019 contributions to the successful reorganization , including agreeing to reductions in pay and benefits , we agreed in the plan to provide each employee group a deemed claim , which was used to provide a distribution of a portion of the equity of the reorganized entity to those employees .

each employee group received a deemed claim amount based upon a portion of the value of cost savings provided by that group through reductions to pay and benefits as well as through certain work rule changes .
the total value of this deemed claim was approximately $ 1.7 billion .

( 2 ) amounts include allowed claims ( claims approved by the bankruptcy court ) and estimated allowed claims relating to ( i ) the rejection or modification of financings related to aircraft and ( ii ) entry of orders treated as unsecured claims with respect to facility agreements supporting certain issuances of special facility revenue bonds .
the debtors recorded an estimated claim associated with the rejection or modification of a financing

 |
| table | | 2013
------------------------------------------------------------------------- | ------
labor-related deemed claim ( 1 )                                          | $ 1733
aircraft and facility financing renegotiations and rejections ( 2 ) ( 3 ) | 325
fair value of conversion discount ( 4 )                                   | 218
professional fees                                                         | 199
other                                                                     | 180
total reorganization items net                                            | $ 2655 |


| _id | dd4b8ca2a |
| title |  |
| text | contingencies we are exposed to certain known contingencies that are material to our investors .
the facts and circumstances surrounding these contingencies and a discussion of their effect on us are in note 12 to our audited consolidated financial statements included elsewhere in this annual report on form 10-k .
these contingencies may have a material effect on our liquidity , capital resources or results of operations .

in addition , even where our reserves are adequate , the incurrence of any of these liabilities may have a material effect on our liquidity and the amount of cash available to us for other purposes .
we believe that we have made appropriate arrangements in respect of the future effect on us of these known contingencies .

we also believe that the amount of cash available to us from our operations , together with cash from financing , will be sufficient for us to pay any known contingencies as they become due without materially affecting our ability to conduct our operations and invest in the growth of our business .
off-balance sheet arrangements we do not have any off-balance sheet arrangements except for operating leases entered into in the normal course of business .

contractual obligations and commitments below is a summary of our future payment commitments by year under contractual obligations as of december 31 , 2018: .

( 1 ) interest payments on our debt are based on the interest rates in effect on december 31 , 2018 .
( 2 ) purchase obligations are defined as agreements to purchase goods or services that are enforceable and legally binding and that specify all significant terms , including fixed or minimum quantities to be purchased , fixed , minimum or variable pricing provisions and the approximate timing of the transactions .
( 3 ) we are currently committed to invest $ 120 million in private equity funds .

as of december 31 , 2018 , we have funded approximately $ 78 million of these commitments and we have approximately $ 42 million remaining to be funded which has not been included in the above table as we are unable to predict when these commitments will be paid .
( 4 ) amounts represent expected future benefit payments for our pension and postretirement benefit plans , as well as expected contributions for 2019 for our funded pension benefit plans .

we made cash contributions totaling approximately $ 31 million to our defined benefit plans in 2018 , and we estimate that we will make contributions totaling approximately $ 25 million to our defined benefit plans in 2019 .

due to the potential impact of future plan investment performance , changes in interest rates , changes in other economic and demographic assumptions and changes in legislation in foreign jurisdictions , we are not able to reasonably estimate the timing and amount of contributions that may be required to fund our defined benefit plans for periods beyond 2019 .

( 5 ) as of december 31 , 2018 , our liability related to uncertain income tax positions was approximately $ 106 million , $ 89 million of which has not been included in the above table as we are unable to predict when these liabilities will be paid due to the uncertainties in the timing of the settlement of the income tax positions.

 |
| table | ( in millions )                                | 2019   | 2020 - 2021 | 2022 - 2023 | thereafter | total
---------------------------------------------- | ------ | ----------- | ----------- | ---------- | -------
long-term debt including interest ( 1 )        | $ 508  | $ 1287      | $ 3257      | $ 8167     | $ 13219
operating leases                               | 167    | 244         | 159         | 119        | 689
data acquisition                               | 289    | 467         | 135         | 4          | 895
purchase obligations ( 2 )                     | 17     | 22          | 15          | 8          | 62
commitments to unconsolidated affiliates ( 3 ) | 2014   | 2014        | 2014        | 2014       | 2014
benefit obligations ( 4 )                      | 25     | 27          | 29          | 81         | 162
uncertain income tax positions ( 5 )           | 17     | 2014        | 2014        | 2014       | 17
total                                          | $ 1023 | $ 2047      | $ 3595      | $ 8379     | $ 15044 |


| _id | dd4ba6a56 |
| title |  |
| text | the company entered into agreements with various governmental entities in the states of kentucky , georgia and tennessee to implement tax abatement plans related to its distribution center in franklin , kentucky ( simpson county ) , its distribution center in macon , georgia ( bibb county ) , and its store support center in brentwood , tennessee ( williamson county ) .

the tax abatement plans provide for reduction of real property taxes for specified time frames by legally transferring title to its real property in exchange for industrial revenue bonds .
this property was then leased back to the company .
no cash was exchanged .
the lease payments are equal to the amount of the payments on the bonds .
the tax abatement period extends through the term of the lease , which coincides with the maturity date of the bonds .

at any time , the company has the option to purchase the real property by paying off the bonds , plus $ 1 .
the terms and amounts authorized and drawn under each industrial revenue bond agreement are outlined as follows , as of december 30 , 2017 : bond term bond authorized amount ( in millions ) amount drawn ( in millions ) .

due to the form of these transactions , the company has not recorded the bonds or the lease obligation associated with the sale lease-back transaction .
the original cost of the company 2019s property and equipment is recorded on the balance sheet and is being depreciated over its estimated useful life .

capitalized software costs the company capitalizes certain costs related to the acquisition and development of software and amortizes these costs using the straight-line method over the estimated useful life of the software , which is three to five years .
computer software consists of software developed for internal use and third-party software purchased for internal use .

a subsequent addition , modification or upgrade to internal-use software is capitalized to the extent that it enhances the software 2019s functionality or extends its useful life .
these costs are included in computer software and hardware in the accompanying consolidated balance sheets .
certain software costs not meeting the criteria for capitalization are expensed as incurred .

store closing costs the company regularly evaluates the performance of its stores and periodically closes those that are under-performing .
the company records a liability for costs associated with an exit or disposal activity when the liability is incurred , usually in the period the store closes .
store closing costs were not significant to the results of operations for any of the fiscal years presented .

leases assets under capital leases are amortized in accordance with the company 2019s normal depreciation policy for owned assets or over the lease term , if shorter , and the related charge to operations is included in depreciation expense in the consolidated statements of income .
certain operating leases include rent increases during the lease term .

for these leases , the company recognizes the related rental expense on a straight-line basis over the term of the lease ( which includes the pre-opening period of construction , renovation , fixturing and merchandise placement ) and records the difference between the expense charged to operations and amounts paid as a deferred rent liability .
the company occasionally receives reimbursements from landlords to be used towards improving the related store to be leased .

leasehold improvements are recorded at their gross costs , including items reimbursed by landlords .
related reimbursements are deferred and amortized on a straight-line basis as a reduction of rent expense over the applicable lease term .
note 2 - share-based compensation : share-based compensation includes stock option and restricted stock unit awards and certain transactions under the company 2019s espp .

share-based compensation expense is recognized based on the grant date fair value of all stock option and restricted stock unit awards plus a discount on shares purchased by employees as a part of the espp .
the discount under the espp represents the difference between the purchase date market value and the employee 2019s purchase price.

 |
| table | | bond term | bond authorized amount ( in millions ) | amount drawn ( in millions )
---------------------------------------- | --------- | -------------------------------------- | ----------------------------
franklin kentucky distribution center    | 30 years  | $ 54.0                                 | $ 51.8
macon georgia distribution center        | 15 years  | $ 58.0                                 | $ 49.9
brentwood tennessee store support center | 10 years  | $ 78.0                                 | $ 75.3 |


| _id | dd4c5d35a |
| title |  |
| text | performance graph the following graph is a comparison of the five-year cumulative return of our common shares , the standard & poor 2019s 500 index ( the 201cs&p 500 index 201d ) and the national association of real estate investment trusts 2019 ( 201cnareit 201d ) all equity index , a peer group index .

the graph assumes that $ 100 was invested on december 31 , 2009 in our common shares , the s&p 500 index and the nareit all equity index and that all dividends were reinvested without the payment of any commissions .
there can be no assurance that the performance of our shares will continue in line with the same or similar trends depicted in the graph below. .

 |
| table | | 2009  | 2010  | 2011  | 2012  | 2013  | 2014
--------------------------- | ----- | ----- | ----- | ----- | ----- | -----
vornado realty trust        | $ 100 | $ 123 | $ 118 | $ 128 | $ 147 | $ 201
s&p 500 index               | 100   | 115   | 117   | 136   | 180   | 205
the nareit all equity index | 100   | 128   | 139   | 166   | 171   | 218 |


| _id | dd4bce560 |
| title |  |
| text | contractual obligations the following table summarizes our significant contractual obligations as of december 28 , 2013: .

capital purchase obligations1 5503 5375 125 2014 3 other purchase obligations and commitments2 1859 772 744 307 36 long-term debt obligations3 22372 429 2360 3761 15822 other long-term liabilities4 , 5 1496 569 663 144 120 total6 $ 32100 $ 7353 $ 4190 $ 4378 $ 16179 1 capital purchase obligations represent commitments for the construction or purchase of property , plant and equipment .

they were not recorded as liabilities on our consolidated balance sheets as of december 28 , 2013 , as we had not yet received the related goods or taken title to the property .
2 other purchase obligations and commitments include payments due under various types of licenses and agreements to purchase goods or services , as well as payments due under non-contingent funding obligations .
funding obligations include agreements to fund various projects with other companies .

3 amounts represent principal and interest cash payments over the life of the debt obligations , including anticipated interest payments that are not recorded on our consolidated balance sheets .
any future settlement of convertible debt would impact our cash payments .
4 we are unable to reliably estimate the timing of future payments related to uncertain tax positions ; therefore , $ 188 million of long-term income taxes payable has been excluded from the preceding table .

however , long- term income taxes payable , recorded on our consolidated balance sheets , included these uncertain tax positions , reduced by the associated federal deduction for state taxes and u.s .
tax credits arising from non- u.s .
income taxes .
5 amounts represent future cash payments to satisfy other long-term liabilities recorded on our consolidated balance sheets , including the short-term portion of these long-term liabilities .
expected required contributions to our u.s .
and non-u.s .

and non-u.s .
pension plans and other postretirement benefit plans of $ 62 million to be made during 2014 are also included ; however , funding projections beyond 2014 are not practicable to estimate .
6 total excludes contractual obligations already recorded on our consolidated balance sheets as current liabilities except for the short-term portions of long-term debt obligations and other long-term liabilities .

contractual obligations for purchases of goods or services , included in other purchase obligations and commitments in the preceding table , include agreements that are enforceable and legally binding on intel and that specify all significant terms , including fixed or minimum quantities to be purchased ; fixed , minimum , or variable price provisions ; and the approximate timing of the transaction .

for obligations with cancellation provisions , the amounts included in the preceding table were limited to the non-cancelable portion of the agreement terms or the minimum cancellation fee .
we have entered into certain agreements for the purchase of raw materials that specify minimum prices and quantities based on a percentage of the total available market or based on a percentage of our future purchasing requirements .

due to the uncertainty of the future market and our future purchasing requirements , as well as the non-binding nature of these agreements , obligations under these agreements are not included in the preceding table .
our purchase orders for other products are based on our current manufacturing needs and are fulfilled by our vendors within short time horizons .
in addition , some of our purchase orders represent authorizations to purchase rather than binding agreements .

table of contents management 2019s discussion and analysis of financial condition and results of operations ( continued )

 |
| table | ( in millions )                             | payments due by period total | payments due by period less than1 year | payments due by period 1 20133 years | payments due by period 3 20135 years | payments due by period more than5 years
------------------------------------------- | ---------------------------- | -------------------------------------- | ------------------------------------ | ------------------------------------ | ---------------------------------------
operating lease obligations                 | $ 870                        | $ 208                                  | $ 298                                | $ 166                                | $ 198
capital purchase obligations1               | 5503                         | 5375                                   | 125                                  | 2014                                 | 3
other purchase obligations and commitments2 | 1859                         | 772                                    | 744                                  | 307                                  | 36
long-term debt obligations3                 | 22372                        | 429                                    | 2360                                 | 3761                                 | 15822
other long-term liabilities4 5              | 1496                         | 569                                    | 663                                  | 144                                  | 120
total6                                      | $ 32100                      | $ 7353                                 | $ 4190                               | $ 4378                               | $ 16179 |


| _id | dd4c59dea |
| title |  |
| text | republic services , inc .
notes to consolidated financial statements 2014 ( continued ) credit exposure , we continually monitor the credit worthiness of the financial institutions where we have deposits .
concentrations of credit risk with respect to trade accounts receivable are limited due to the wide variety of customers and markets in which we provide services , as well as the dispersion of our operations across many geographic areas .

we provide services to small-container commercial , large-container industrial , municipal and residential customers in the united states and puerto rico .
we perform ongoing credit evaluations of our customers , but generally do not require collateral to support customer receivables .
we establish an allowance for doubtful accounts based on various factors including the credit risk of specific customers , age of receivables outstanding , historical trends , economic conditions and other information .

accounts receivable , net accounts receivable represent receivables from customers for collection , transfer , recycling , disposal , energy services and other services .
our receivables are recorded when billed or when the related revenue is earned , if earlier , and represent claims against third parties that will be settled in cash .
the carrying value of our receivables , net of the allowance for doubtful accounts and customer credits , represents their estimated net realizable value .

provisions for doubtful accounts are evaluated on a monthly basis and are recorded based on our historical collection experience , the age of the receivables , specific customer information and economic conditions .
we also review outstanding balances on an account-specific basis .
in general , reserves are provided for accounts receivable in excess of 90 days outstanding .
past due receivable balances are written-off when our collection efforts have been unsuccessful in collecting amounts due .

the following table reflects the activity in our allowance for doubtful accounts for the years ended december 31: .

restricted cash and marketable securities as of december 31 , 2015 , we had $ 100.3 million of restricted cash and marketable securities .
we obtain funds through the issuance of tax-exempt bonds for the purpose of financing qualifying expenditures at our landfills , transfer stations , collection and recycling centers .
the funds are deposited directly into trust accounts by the bonding authorities at the time of issuance .

as the use of these funds is contractually restricted , and we do not have the ability to use these funds for general operating purposes , they are classified as restricted cash and marketable securities in our consolidated balance sheets .

in the normal course of business , we may be required to provide financial assurance to governmental agencies and a variety of other entities in connection with municipal residential collection contracts , closure or post- closure of landfills , environmental remediation , environmental permits , and business licenses and permits as a financial guarantee of our performance .

at several of our landfills , we satisfy financial assurance requirements by depositing cash into restricted trust funds or escrow accounts .
property and equipment we record property and equipment at cost .
expenditures for major additions and improvements to facilities are capitalized , while maintenance and repairs are charged to expense as incurred .

when property is retired or otherwise disposed , the related cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is reflected in the consolidated statements of income.

 |
| table | | 2015           | 2014           | 2013
---------------------------- | -------------- | -------------- | --------------
balance at beginning of year | $ 38.9         | $ 38.3         | $ 45.3
additions charged to expense | 22.7           | 22.6           | 16.1
accounts written-off         | -14.9 ( 14.9 ) | -22.0 ( 22.0 ) | -23.1 ( 23.1 )
balance at end of year       | $ 46.7         | $ 38.9         | $ 38.3 |


| _id | dd4984962 |
| title |  |
| text | interest rate cash flow hedges 2013 we report changes in the fair value of cash flow hedges in accumulated other comprehensive loss until the hedged item affects earnings .
at both december 31 , 2008 and 2007 , we had reductions of $ 4 million recorded as an accumulated other comprehensive loss that is being amortized on a straight-line basis through september 30 , 2014 .
as of december 31 , 2008 and 2007 , we had no interest rate cash flow hedges outstanding .

earnings impact 2013 our use of derivative financial instruments had the following impact on pre-tax income for the years ended december 31 : millions of dollars 2008 2007 2006 .

fair value of debt instruments 2013 the fair value of our short- and long-term debt was estimated using quoted market prices , where available , or current borrowing rates .
at december 31 , 2008 , the fair value of total debt is approximately $ 247 million less than the carrying value .
at december 31 , 2007 , the fair value of total debt exceeded the carrying value by approximately $ 96 million .

at december 31 , 2008 and 2007 , approximately $ 320 million and $ 181 million , respectively , of fixed-rate debt securities contained call provisions that allowed us to retire the debt instruments prior to final maturity , with the payment of fixed call premiums , or in certain cases , at par .
sale of receivables 2013 the railroad transfers most of its accounts receivable to union pacific receivables , inc .
( upri ) , a bankruptcy-remote subsidiary , as part of a sale of receivables facility .

upri sells , without recourse on a 364-day revolving basis , an undivided interest in such accounts receivable to investors .
the total capacity to sell undivided interests to investors under the facility was $ 700 million and $ 600 million at december 31 , 2008 and 2007 , respectively .
the value of the outstanding undivided interest held by investors under the facility was $ 584 million and $ 600 million at december 31 , 2008 and 2007 , respectively .

upri reduced the outstanding undivided interest held by investors due to a decrease in available receivables at december 31 , 2008 .
the value of the outstanding undivided interest held by investors is not included in our consolidated financial statements .
the value of the undivided interest held by investors was supported by $ 1015 million and $ 1071 million of accounts receivable held by upri at december 31 , 2008 and 2007 , respectively .

at december 31 , 2008 and 2007 , the value of the interest retained by upri was $ 431 million and $ 471 million , respectively .
this retained interest is included in accounts receivable in our consolidated financial statements .
the interest sold to investors is sold at carrying value , which approximates fair value , and there is no gain or loss recognized from the transaction .

the value of the outstanding undivided interest held by investors could fluctuate based upon the availability of eligible receivables and is directly affected by changing business volumes and credit risks , including default and dilution .
if default or dilution percentages were to increase one percentage point , the amount of eligible receivables would decrease by $ 6 million .

should our credit rating fall below investment grade , the value of the outstanding undivided interest held by investors would be reduced , and , in certain cases , the investors would have the right to discontinue the facility .
the railroad services the sold receivables ; however , the railroad does not recognize any servicing asset or liability as the servicing fees adequately compensate us for these responsibilities .

the railroad collected approximately $ 17.8 billion and $ 16.1 billion during the years ended december 31 , 2008 and 2007 , respectively .
upri used certain of these proceeds to purchase new receivables under the facility.

 |
| table | millions of dollars                                                   | 2008 | 2007       | 2006
--------------------------------------------------------------------- | ---- | ---------- | ----------
( increase ) /decrease in interest expense from interest rate hedging | $ 1  | $ -8 ( 8 ) | $ -8 ( 8 )
( increase ) /decrease in fuel expense from fuel derivatives          | 1    | -1 ( 1 )   | 3
increase/ ( decrease ) in pre-tax income                              | $ 2  | $ -9 ( 9 ) | $ -5 ( 5 ) |


| _id | dd4b8ab80 |
| title |  |
| text | freesheet paper were higher in russia , but lower in europe reflecting weak economic conditions and market demand .
average sales price realizations for pulp decreased .
lower input costs for wood and purchased fiber were partially offset by higher costs for energy , chemicals and packaging .
freight costs were also higher .

freight costs were also higher .
planned maintenance downtime costs were higher due to executing a significant once-every-ten-years maintenance outage plus the regularly scheduled 18-month outage at the saillat mill while outage costs in russia and poland were lower .
manufacturing operating costs were favor- entering 2013 , sales volumes in the first quarter are expected to be seasonally weaker in russia , but about flat in europe .

average sales price realizations for uncoated freesheet paper are expected to decrease in europe , but increase in russia .
input costs should be higher in russia , especially for wood and energy , but be slightly lower in europe .
no maintenance outages are scheduled for the first quarter .
ind ian papers includes the results of andhra pradesh paper mills ( appm ) of which a 75% ( 75 % ) interest was acquired on october 14 , 2011 .
net sales were $ 185 million in 2012 and $ 35 million in 2011 .

operat- ing profits were a loss of $ 16 million in 2012 and a loss of $ 3 million in 2011 .
asian pr int ing papers net sales were $ 85 mil- lion in 2012 , $ 75 million in 2011 and $ 80 million in 2010 .
operating profits were improved from break- even in past years to $ 1 million in 2012 .
u.s .
pulp net sales were $ 725 million in 2012 compared with $ 725 million in 2011 and $ 715 million in 2010 .

operating profits were a loss of $ 59 million in 2012 compared with gains of $ 87 million in 2011 and $ 107 million in 2010 .
sales volumes in 2012 increased from 2011 primarily due to the start-up of pulp production at the franklin mill in the third quarter of 2012 .
average sales price realizations were significantly lower for both fluff pulp and market pulp .
input costs were lower , primarily for wood and energy .
freight costs were slightly lower .

freight costs were slightly lower .
mill operating costs were unfavorable primarily due to costs associated with the start-up of the franklin mill .
planned maintenance downtime costs were lower .
in the first quarter of 2013 , sales volumes are expected to be flat with the fourth quarter of 2012 .
average sales price realizations are expected to improve reflecting the realization of sales price increases for paper and tissue pulp that were announced in the fourth quarter of 2012 .

input costs should be flat .
planned maintenance downtime costs should be about $ 9 million higher than in the fourth quarter of 2012 .
manufacturing costs related to the franklin mill should be lower as we continue to improve operations .
consumer packaging demand and pricing for consumer packaging prod- ucts correlate closely with consumer spending and general economic activity .

in addition to prices and volumes , major factors affecting the profitability of consumer packaging are raw material and energy costs , freight costs , manufacturing efficiency and product mix .
consumer packaging net sales in 2012 decreased 15% ( 15 % ) from 2011 and 7% ( 7 % ) from 2010 .
operating profits increased 64% ( 64 % ) from 2011 and 29% ( 29 % ) from 2010 .
net sales and operating profits include the shorewood business in 2011 and 2010 .

exclud- ing asset impairment and other charges associated with the sale of the shorewood business , and facility closure costs , 2012 operating profits were 27% ( 27 % ) lower than in 2011 , but 23% ( 23 % ) higher than in 2010 .

benefits from lower raw material costs ( $ 22 million ) , lower maintenance outage costs ( $ 5 million ) and other items ( $ 2 million ) were more than offset by lower sales price realizations and an unfavorable product mix ( $ 66 million ) , lower sales volumes and increased market-related downtime ( $ 22 million ) , and higher operating costs ( $ 40 million ) .

in addition , operating profits in 2012 included a gain of $ 3 million related to the sale of the shorewood business while operating profits in 2011 included a $ 129 million fixed asset impairment charge for the north ameri- can shorewood business and $ 72 million for other charges associated with the sale of the shorewood business .
consumer packaging .

north american consumer packaging net sales were $ 2.0 billion in 2012 compared with $ 2.5 billion in 2011 and $ 2.4 billion in 2010 .
operating profits were $ 165 million ( $ 162 million excluding a gain related to the sale of the shorewood business ) in 2012 compared with $ 35 million ( $ 236 million excluding asset impairment and other charges asso- ciated with the sale of the shorewood business ) in 2011 and $ 97 million ( $ 105 million excluding facility closure costs ) in 2010 .

coated paperboard sales volumes in 2012 were lower than in 2011 reflecting weaker market demand .
average sales price realizations were lower , primar- ily for folding carton board .
input costs for wood increased , but were partially offset by lower costs for chemicals and energy .
planned maintenance down- time costs were slightly lower .
market-related down- time was about 113000 tons in 2012 compared with about 38000 tons in 2011.

 |
| table | in millions      | 2012   | 2011   | 2010
---------------- | ------ | ------ | ------
sales            | $ 3170 | $ 3710 | $ 3400
operating profit | 268    | 163    | 207 |


| _id | dd4c1e8a8 |
| title |  |
| text | item 4 .
submission of matters to a vote of security holders no matters were submitted to a vote of security holders during the fourth quarter of 2005 .
part ii item 5 .
market for the registrant 2019s common equity , related stockholder matters and issuer purchases of equity securities market information our series a common stock has traded on the new york stock exchange under the symbol 2018 2018ce 2019 2019 since january 21 , 2005 .

the closing sale price of our series a common stock , as reported by the new york stock exchange , on march 6 , 2006 was $ 20.98 .
the following table sets forth the high and low intraday sales prices per share of our common stock , as reported by the new york stock exchange , for the periods indicated. .

holders no shares of celanese 2019s series b common stock are issued and outstanding .
as of march 6 , 2006 , there were 51 holders of record of our series a common stock , and one holder of record of our perpetual preferred stock .
by including persons holding shares in broker accounts under street names , however , we estimate our shareholder base to be approximately 6800 as of march 6 , 2006 .

dividend policy in july 2005 , our board of directors adopted a policy of declaring , subject to legally available funds , a quarterly cash dividend on each share of our common stock at an annual rate initially equal to approximately 1% ( 1 % ) of the $ 16 price per share in the initial public offering of our series a common stock ( or $ 0.16 per share ) unless our board of directors , in its sole discretion , determines otherwise , commencing the second quarter of 2005 .

pursuant to this policy , the company paid the quarterly dividends of $ 0.04 per share on august 11 , 2005 , november 1 , 2005 and february 1 , 2006 .
based on the number of outstanding shares of our series a common stock , the anticipated annual cash dividend is approximately $ 25 million .
however , there is no assurance that sufficient cash will be available in the future to pay such dividend .

further , such dividends payable to holders of our series a common stock cannot be declared or paid nor can any funds be set aside for the payment thereof , unless we have paid or set aside funds for the payment of all accumulated and unpaid dividends with respect to the shares of our preferred stock , as described below .
our board of directors may , at any time , modify or revoke our dividend policy on our series a common stock .

we are required under the terms of the preferred stock to pay scheduled quarterly dividends , subject to legally available funds .

for so long as the preferred stock remains outstanding , ( 1 ) we will not declare , pay or set apart funds for the payment of any dividend or other distribution with respect to any junior stock or parity stock and ( 2 ) neither we , nor any of our subsidiaries , will , subject to certain exceptions , redeem , purchase or otherwise acquire for consideration junior stock or parity stock through a sinking fund or otherwise , in each case unless we have paid or set apart funds for the payment of all

paid or set apart funds for the payment of all accumulated and unpaid dividends with respect to the shares of preferred stock and any parity stock for all preceding dividend periods .

pursuant to this policy , the company paid the quarterly dividends of $ 0.265625 on its 4.25% ( 4.25 % ) convertible perpetual preferred stock on august 1 , 2005 , november 1 , 2005 and february 1 , 2006 .
the anticipated annual cash dividend is approximately $ 10 million.

 |
| table | 2005                           | pricerange high | pricerange low
------------------------------ | --------------- | --------------
quarterended march 312005      | $ 18.65         | $ 15.10
quarter endedjune 302005       | $ 18.16         | $ 13.54
quarter endedseptember 30 2005 | $ 20.06         | $ 15.88
quarter endeddecember 312005   | $ 19.76         | $ 15.58 |


| _id | dd4bde5c8 |
| title |  |
| text | overview we finance our operations and capital expenditures through a combination of internally generated cash from operations and from borrowings under our senior secured asset-based revolving credit facility .
we believe that our current sources of funds will be sufficient to fund our cash operating requirements for the next year .

in addition , we believe that , in spite of the uncertainty of future macroeconomic conditions , we have adequate sources of liquidity and funding available to meet our longer-term needs .
however , there are a number of factors that may negatively impact our available sources of funds .
the amount of cash generated from operations will be dependent upon factors such as the successful execution of our business plan and general economic conditions .

long-term debt activities during the year ended december 31 , 2014 , we had significant debt refinancings .
in connection with these refinancings , we recorded a loss on extinguishment of long-term debt of $ 90.7 million in our consolidated statement of operations for the year ended december 31 , 2014 .
see note 7 to the accompanying audited consolidated financial statements included elsewhere in this report for additional details .

share repurchase program on november 6 , 2014 , we announced that our board of directors approved a $ 500 million share repurchase program effective immediately under which we may repurchase shares of our common stock in the open market or through privately negotiated transactions , depending on share price , market conditions and other factors .

the share repurchase program does not obligate us to repurchase any dollar amount or number of shares , and repurchases may be commenced or suspended from time to time without prior notice .
as of the date of this filing , no shares have been repurchased under the share repurchase program .
dividends a summary of 2014 dividend activity for our common stock is shown below: .

on february 10 , 2015 , we announced that our board of directors declared a quarterly cash dividend on our common stock of $ 0.0675 per share .
the dividend will be paid on march 10 , 2015 to all stockholders of record as of the close of business on february 25 , 2015 .

the payment of any future dividends will be at the discretion of our board of directors and will depend upon our results of operations , financial condition , business prospects , capital requirements , contractual restrictions , any potential indebtedness we may incur , restrictions imposed by applicable law , tax considerations and other factors that our board of directors deems relevant .

in addition , our ability to pay dividends on our common stock will be limited by restrictions on our ability to pay dividends or make distributions to our stockholders and on the ability of our subsidiaries to pay dividends or make distributions to us , in each case , under the terms of our current and any future agreements governing our indebtedness .
table of contents

 |
| table | dividend amount | declaration date | record date      | payment date
--------------- | ---------------- | ---------------- | -----------------
$ 0.0425        | february 12 2014 | february 25 2014 | march 10 2014
$ 0.0425        | may 8 2014       | may 27 2014      | june 10 2014
$ 0.0425        | july 31 2014     | august 25 2014   | september 10 2014
$ 0.0675        | november 6 2014  | november 25 2014 | december 10 2014 |


| _id | dd4c52d60 |
| title |  |
| text | the fair value of options that vested during the years ended december 31 , 2017 , 2016 and 2015 was $ 6.8 million , $ 6.0 million and $ 7.8 million , respectively .
the intrinsic value of fortune brands stock options exercised in the years ended december 31 , 2017 , 2016 and 2015 was $ 70.6 million , $ 88.1 million and $ 78.0 million , respectively .

performance awards performance share awards were granted to officers and certain employees of the company under the plans and represent the right to earn shares of company common stock based on the achievement of or company-wide performance conditions , including cumulative diluted earnings per share , average return on invested capital , average return on net tangible assets and ebitda during the three-year performance period .

compensation cost is amortized into expense over the performance period , which is generally three years , and is based on the probability of meeting performance targets .
the fair value of each performance share award is based on the average of the high and low stock price on the date of grant .
the following table summarizes information about performance share awards as of december 31 , 2017 , as well as activity during the year then ended .

the number of performance share awards granted are shown below at the target award amounts : number of performance share awards weighted-average grant-date fair value .

the remaining unrecognized pre-tax compensation cost related to performance share awards at december 31 , 2017 was approximately $ 6.8 million , and the weighted-average period of time over which this cost will be recognized is 1.3 years .
the fair value of performance share awards that vested during 2017 was $ 5.6 million ( 100580 shares ) .
director awards stock awards are used as part of the compensation provided to outside directors under the plan .
awards are issued annually in the second quarter .

in addition , outside directors can elect to have director fees paid in stock or can elect to defer payment of stock .
compensation cost is expensed at the time of an award based on the fair value of a share at the date of the award .
in 2017 , 2016 and 2015 , we awarded 15311 , 16471 and 19695 shares of company common stock to outside directors with a weighted average fair value on the date of the award of $ 63.43 , $ 57.37 and $ 46.21 , respectively .
14 .

14 .
defined benefit plans we have a number of pension plans in the united states , covering many of the company 2019s employees , however these plans have been closed to new hires .
the plans provide for payment of retirement benefits , mainly commencing between the ages of 55 and 65 .
after meeting certain qualifications , an employee acquires a vested right to future benefits .

the benefits payable under the plans are generally determined on the basis of an employee 2019s length of service and/or earnings .
employer contributions to the plans are made , as necessary , to ensure legal funding requirements are satisfied .
also , from time to time , we may make contributions in excess of the legal funding requirements .
service cost for 2017 relates to benefit accruals in an hourly union defined benefit plan in our security segment .

benefit accruals under all other defined benefit pension plans were frozen as of december 31 , 2016.

 |
| table | | number of performance share awards | weighted-averagegrant-datefair value
----------------------------- | ---------------------------------- | ------------------------------------
non-vestedat december 31 2016 | 421600                             | $ 48.00
granted                       | 160196                             | 58.02
vested                        | -95183 ( 95183 )                   | 45.13
forfeited                     | -58285 ( 58285 )                   | 48.22
non-vestedat december 31 2017 | 428328                             | $ 52.35 |


| _id | dd4bb7e1e |
| title |  |
| text | there are inherent limitations on the effectiveness of our controls .
we do not expect that our disclosure controls or our internal control over financial reporting will prevent or detect all errors and all fraud .
a control system , no matter how well-designed and operated , can provide only reasonable , not absolute , assurance that the control system 2019s objectives will be met .

the design of a control system must reflect the fact that resource constraints exist , and the benefits of controls must be considered relative to their costs .
further , because of the inherent limitations in all control systems , no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud , if any , have been detected .

the design of any system of controls is based in part on certain assumptions about the likelihood of future events , and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions .
projections of any evaluation of the effectiveness of controls to future periods are subject to risks .
over time , controls may become inadequate due to changes in conditions or deterioration in the degree of compliance with policies or procedures .

if our controls become inadequate , we could fail to meet our financial reporting obligations , our reputation may be adversely affected , our business and operating results could be harmed , and the market price of our stock could decline .
item 1b .
unresolved staff comments not applicable .
item 2 .
properties as of december 31 , 2016 , our major facilities consisted of : ( square feet in millions ) united states countries total owned facilities1 .
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31.5 19.2 50.7 leased facilities2 .
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2.5 7.1 9.6 .

1 leases and municipal grants on portions of the land used for these facilities expire on varying dates through 2109 .
2 leases expire on varying dates through 2058 and generally include renewals at our option .
our principal executive offices are located in the u.s .
and the majority of our wafer manufacturing activities in 2016 were also located in the u.s .

one of our arizona wafer fabrication facilities is currently on hold and held in a safe state , and we are reserving the building for additional capacity and future technologies .
incremental construction and equipment installation are required to ready the facility for its intended use .
for more information on our wafer fabrication and our assembly and test facilities , see 201cmanufacturing and assembly and test 201d in part i , item 1 of this form 10-k .

we believe that the facilities described above are suitable and adequate for our present purposes and that the productive capacity in our facilities is substantially being utilized or we have plans to utilize it .
we do not identify or allocate assets by operating segment .
for information on net property , plant and equipment by country , see 201cnote 4 : operating segments and geographic information 201d in part ii , item 8 of this form 10-k .
item 3 .

item 3 .
legal proceedings for a discussion of legal proceedings , see 201cnote 20 : commitments and contingencies 201d in part ii , item 8 of this form 10-k .
item 4 .
mine safety disclosures not applicable.

 |
| table | ( square feet in millions ) | unitedstates | othercountries | total
--------------------------- | ------------ | -------------- | -----
owned facilities1           | 31.5         | 19.2           | 50.7
leased facilities2          | 2.5          | 7.1            | 9.6
total facilities            | 34.0         | 26.3           | 60.3 |