| _id | d1b342b5e |
| title |  |
| text | B. Liquidity and Capital Resources
As of June 30, 2019, we had cash and cash equivalents totaling $1.3 billion, short-term investments totaling $445.0 million and trade receivables totaling $82.5 million. Since our inception, we have primarily financed our operations through cash flows generated by operations.
Our cash flows from operating activities, investing activities, and financing activities for the fiscal years ended 2019, 2018 and 2017 were as follows:

We believe that our existing cash and cash equivalents, together with cash generated from operations, will be sufficient to meet our anticipated cash needs for at least the next 12 months. Our future capital requirements will depend on many factors including our growth rate, the timing and extent of spend on research and development efforts, employee headcount, marketing and sales activities, acquisitions of additional businesses and technologies, the timing and extent of exchange of the Notes for payments

and extent of exchange of the Notes for payments of cash, the introduction of new software and services offerings, enhancements to our existing software and services offerings and the continued market acceptance of our products.

Cash provided by operating activities has historically been affected by the amount of net income (loss) adjusted for non-cash expense items such as non-coupon impact related to the Notes and capped calls, depreciation and amortization and expense associated with share-based awards, the timing of employee-related costs such as bonus payments, collections from our customers, which is our largest source of operating cash flows, and changes in other working capital accounts.

Accounts impacting working capital consist of trade receivables, prepaid expenses and other current assets, current derivative assets, trade and other payables, provisions, current derivative liabilities, current portion of our Notes and other current liabilities. Our working capital may be impacted by various factors in future periods, such as billings to customers for subscriptions, licenses and maintenance services and the subsequent collection of those billings or the amount and timing of certain

billings or the amount and timing of certain expenditures.

Net cash provided by operating activities was $466.3 million for the fiscal year ended June 30, 2019, as a result of $605.6 million in loss before income tax expense adjusted by non-cash charges including the loss of marking to fair value of the embedded exchange feature of the Notes and related capped call transactions of $533.9 million, depreciation and amortization of $70.2 million, share-based payment expense of $257.8 million and debt discount and issuance cost amortization of $33.9 million. The net

cost amortization of $33.9 million. The net increase of $169.0 million from our operating assets and liabilities was primarily attributable to a $122.5 million increase in our deferred revenue as a result of increased sales of subscriptions and renewals of maintenance contracts and a $75.6 million increase in trade and other payables, provisions and other non-current liabilities, offset by a $30.2 million increase in trade receivables. Net cash provided by operating activities was also impacted by tax

by operating activities was also impacted by tax refunds received, net of income tax paid of $7.0 million.

Net cash provided by operating activities was $311.5 million for the fiscal year ended June 30, 2018, as a result of $58.1 million in loss before income tax expense adjusted by non-cash charges including the loss of marking to fair value of the embedded exchange feature of the Notes and related capped call transactions of $12.4 million, depreciation and amortization of $79.4 million, share-based payment expense of $162.9 million and debt discount and issuance cost amortization of $7.5 million. The net

cost amortization of $7.5 million. The net increase of $113.1 million from our operating assets and liabilities was primarily attributable to a $97.7 million increase in our deferred revenue as a result of increased sales of subscriptions and renewals of maintenance contracts, a $43.5 million increase in trade and other payables, provisions and other noncurrent liabilities, offset by a $19.6 million increase in trade receivables and a $8.4 million increase in prepaid expenses and other current and

in prepaid expenses and other current and non-current assets. Net cash provided by operating activities was also impacted by income taxes paid, net of refunds, of $4.2 million.

Net cash used in investing activities during the fiscal year ended June 30, 2019 was $604.2 million. This was primarily related to cash paid for business combinations, net of cash acquired, totaling $418.6 million, purchases of investments totaling $648.0 million and purchases of property and equipment totaling $44.2 million to support the growth of our business, including hardware, equipment and leasehold improvements, offset by cash received from the maturing of investments which totaled $485.0 million

of investments which totaled $485.0 million and proceeds from sales of investments of $20.5 million.

Net cash used in investing activities during the fiscal year ended June 30, 2018 was $51.7 million. This was primarily related to purchases of investments totaling $347.8 million and purchases of property and equipment totaling $30.2 million to support the growth of our business, including hardware, equipment and leasehold improvements, offset by cash received from the maturing of investments which totaled $206.1 million and proceeds from sales of investments of $123.9 million.

Net cash used in financing activities for the fiscal year ended June 30, 2019 was $3.2 million and was primarily related to coupon interest payments on the Notes of $6.3 million, offset by proceeds from exercises of employee share options of $3.5 million.
Net cash provided by financing activities for the fiscal year ended June 30, 2018 was $906.8 million and was primarily related to proceeds from the issuance of our Notes of $990.5 million offset by the purchase of the capped calls for $87.7 million.

 |
| table | |            | Fiscal Year Ended June 30, |
------------------------------------------------------------ | ---------- | -------------------------- | ---------
                                                             | 2019       | 2018                       | 2017
                                                             |            | (U.S. $ in thousands)      |
Net cash provided by operating activities                    | $466,342   | $311,456                   | 199,381
Net cash used in by investing activities                     | (604,198)  | (51,696)                   | (224,573)
Net cash (used in) provided by financing activities          | (3,187)    | 906,789                    | 9,438
Effect of exchange rate changes on cash and cash equivalents | (855)      | (630)                      | 465
Net (decrease) increase in cash and cash equivalents         | $(141,898) | $1,165,919                 | $(15,289) |


| _id | d1b3beeca |
| title |  |
| text | The company has consistently generated strong cash flow from operations, providing a source of funds ranging between $14.8 billion and $16.7 billion per year over the past three years.
The company provides for additional liquidity through several sources: maintaining an adequate cash balance, access to global funding sources, committed global credit facilities and other committed and uncommitted lines of credit worldwide.

The following table provides a summary of the major sources of liquidity for the years ended December 31, 2017 through 2019.

 |
| table | ($ in billions)                                            |       |       |
---------------------------------------------------------- | ----- | ----- | -----
                                                           | 2019  | 2018  | 2017
Net cash operating activities                              | $14.8 | $15.2 | $16.7
Cash, restricted cash and short-term marketable securities | $ 9.0 | $12.2 | $12.8
credit facilities                                          | $15.3 | $15.3 | $15.3 |


| _id | d1b2ea2ec |
| title |  |
| text | RSU Activity We grant RSUs, which represent the right to receive shares of our common stock. Vesting for RSUs is contingent upon the holders’ continued employment with us and may be subject to other conditions (which may include the satisfaction of a performance measure). Also, certain of our performance-based RSUs include a range of shares that may be released at vesting which are above or below the targeted number of RSUs based on actual performance relative to the grant date performance measure. If the

to the grant date performance measure. If the vesting conditions are not met, unvested RSUs will be forfeited. Upon vesting of the RSUs, we may withhold shares otherwise deliverable to satisfy tax withholding requirements.

The following table summarizes our RSU activity with performance-based RSUs presented at the maximum potential shares that could be earned and issued at vesting (amounts in thousands except per share amounts):

Certain of our performance-based RSUs did not have an accounting grant date as of December 31, 2019, as there is not a mutual understanding between the Company and the employee of the performance terms. Generally, these performance terms relate to operating income performance for future years where the performance goals have not yet been set. As of December 31, 2019, there were 3.2 million performance-based RSUs outstanding for which the accounting grant date has not been set, of which 1.9 million were

date has not been set, of which 1.9 million were 2019 grants. Accordingly, no grant date fair value was established and the weighted average grant date fair value calculated above for 2019 grants excludes these RSUs.

At December 31, 2019, approximately $96 million of total unrecognized compensation cost was related to RSUs and is expected to be recognized over a weighted-average period of 1.64 years. Of the total unrecognized compensation cost, $50 million was related to performance-based RSUs, which is expected to be recognized over a weighted-average period of 1.63 years. The total grant date fair value of vested RSUs was $147 million, $120 million and $64 million for the years ended December 31, 2019, 2018, and

for the years ended December 31, 2019, 2018, and 2017, respectively.

The income tax benefit from stock option exercises and RSU vestings was $47 million, $94 million, and $160 million for the years ended December 31, 2019, 2018, and 2017, respectively.

 |
| table | | Number of shares | Weighted-Average Grant Date Fair Value
---------------------------------- | ---------------- | --------------------------------------
Unvested RSUs at December 31, 2018 | 10,623           | $40.39
Granted                            | 4,426            | 45.55
Vested                             | (2,758)          | 47.86
Forfeited                          | (2,963)          | 54.61
Unvested RSUs at December 31, 2019 | 9,328            | $32.60 |


| _id | d1b33599a |
| title |  |
| text | The UK and Ireland business-to-business market remains challenging. The main headwind we face is the decline in traditional calls and lines where we have a relatively high market share. The IP Voice market is significantly more fragmented, with a large number of providers, and we are focused on expanding our share in this growing market.

The mobile market remains competitive and we continue to see pressure on pricing. While overall growth in the broadband market is limited, we are seeing good demand for our premium products such as fibre and 4G Assure. Newer areas such as the Internet of Things, Cloud, SDWAN and security remain good opportunities for us over the longer term.

Adjusted a revenue decreased 5% for the year mainly due to the ongoing decline of fixed voice revenue. We continue to see a steeper than expected reduction in calls per fixed line as usage moves to mobile and IP. We continue to sell less low margin equipment and also experienced ongoing declines in some of our other legacy products such as private circuits. This was partially offset by growth in IP, Mobile and Networking. We’re also continuing to see encouraging growth in messaging volumes in Ventures.

Adjusted a operating costs reduced 6%, helped by labour cost efficiencies from our cost transformation programmes. Adjusteda EBITDA decreased 4%, with our lower cost base more than offset by the reduction in revenue.
Capital expenditure increased 2% and normalised free cash flowb decreased 7%, reflecting the reduction in EBITDA and the higher capital expenditure.

The Retail order intake decreased 15% to £2.9bn for the year due to the signing of a large contract in Republic of Ireland in the prior year. The Wholesale order intake declined 22% to £1.0bn after 2017/18 benefitted from a number of large deals, including the timing of some contract renewals.

a Adjusted measures exclude specific items, as explained in the Additional Information on page 185. b Free cash flow after net interest paid, before pension deficit payments (including the cash tax benefit of pension deficit payments) and specific items. d Enterprise comparatives have been re-presented to reflect the bringing together of our Business and Public Sector and Wholesale and Ventures units into a single Enterprise unit, as well as the transfer of Northern Ireland Networks from Enterprise to

of Northern Ireland Networks from Enterprise to Openreach.

 |
| table | Enterprise d                |                |               |                                    |
--------------------------- | -------------- | ------------- | ---------------------------------- | ---
Adjusteda revenue £6,292m   |                |               | Adjusteda operating profit £1,356m |
                            | 2019 (IFRS 15) | 2018 (IAS 18) | Change                             |
Year to 31 March            | £m             | £m            | £m                                 | %
Adjusted a revenue          | 6,292          | 6,647         | (355)                              | (5)
Adjusted a operating costs  | 4,302          | 4,570         | (268)                              | (6)
Adjusted a EBITDA           | 1,990          | 2,077         | (87)                               | (4)
Depreciation & amortisation | 634            | 635           | (1)                                | -
Adjusted a operating profit | 1,356          | 1,442         | (86)                               | (6)
Capital expenditure         | 501            | 492           | 9                                  | 2
Normalised free cash flow b | 1,483          | 1,587         | (104)                              | (7) |


| _id | d1b2f8e6e |
| title |  |
| text | Legislation and regulations regarding our products and ingredients, including the nutritional content of our products, could impact customer preferences and negatively impact our financial results.

Changes in government regulation and consumer eating habits may impact the ingredients and nutritional content of our menu offerings, or require us to disclose the nutritional content of our menu offerings. For example, a number of states, counties, and cities have enacted menu labeling laws requiring multi-unit restaurant operators to disclose certain nutritional information to customers, or have enacted legislation restricting the use of certain types of ingredients in restaurants. Furthermore, the

of ingredients in restaurants. Furthermore, the Affordable Care Act requires chain restaurants to publish calorie information on their menus and menu boards. These and other requirements may increase our expenses, slow customers’ ordering process, or negatively influence the demand for our offerings; all of which can impact sales and profitability.

Compliance with current and future laws and regulations in a number of areas, including with respect to ingredients, nutritional content of our products, and packaging and serviceware may be costly and time-consuming. Additionally, if consumer health regulations change significantly, we may be required to modify our menu offerings or packaging, and as a result, may experience higher costs or reduced demand associated with such changes. Some government authorities are increasing regulations regarding

authorities are increasing regulations regarding trans-fats and sodium. While we have removed all artificial or “added during manufacturing” trans fats from our ingredients, some ingredients have naturally occurring trans-fats. Future requirements limiting trans-fats or sodium content may require us to change our menu offerings or switch to higher cost ingredients. These actions may hinder our ability to operate in some markets or to offer our full menu in these markets, which could have a material adverse

markets, which could have a material adverse effect on our business. If we fail to comply with such laws and regulations, our business could also experience a material adverse effect.

Failure to obtain and maintain required licenses and permits or to comply with food control regulations could lead to the loss of our food service licenses and, thereby, harm our business.

We are required, as a restaurant business, under state and local government regulations to obtain and maintain licenses, permits, and approvals to operate our businesses. Such regulations are subject to change from time to time. Any failure by us or our franchisees to obtain and maintain these licenses, permits, and approvals could adversely affect our financial results.
The following table sets forth information regarding our operating restaurant properties as of September 29, 2019:

 |
| table | | Company- |           |
---------------------------------------------------------------- | -------- | --------- | -----
                                                                 | Operated | Franchise | Total
Company-owned restaurant buildings:                              |          |           |
On company-owned land                                            | 9        | 200       | 209
On leased land                                                   | 54       | 581       | 635
Subtotal                                                         | 63       | 781       | 844
Company-leased restaurant buildings on leased land               | 74       | 1,054     | 1,128
Franchise directly-owned or directly-leased restaurant buildings | —        | 271       | 271
Total restaurant buildings                                       | 137      | 2,106     | 2,243 |


| _id | d1b3c7304 |
| title |  |
| text | GreenSky, Inc. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) (United States Dollars in thousands, except per share data, unless otherwise stated)
Note 13. Income Taxes

GreenSky, Inc. is taxed as a corporation and pays corporate federal, state and local taxes on income allocated to it from GS Holdings based upon GreenSky, Inc.’s economic interest held in GS Holdings. GS Holdings is treated as a pass-through partnership for income tax reporting purposes and not subject to federal income tax. Accordingly, the Company is not liable for income taxes on the portion of GS Holdings' earnings not allocated to it. The results for the year ended December 31, 2017 do not reflect

the year ended December 31, 2017 do not reflect income tax expense because, prior to the Reorganization Transactions, the consolidated GSLLC (and subsequently GS Holdings) pass-through entity was not subject to corporate tax.

The Company's income before income tax expense of $88,848, $133,514 and $138,668 during the years ended December 31, 2019, 2018 and 2017, respectively, consisted entirely of income earned in the United States.
Components of income tax expense consisted of the following for the years indicated: Year

 |
| table | | Year Ended December 31, |
-------------------------------------- | ----------------------- | ------
                                       | 2019                    | 2018
Current income tax expense (benefit):  |                         |
Federal                                | $5                      | $4
State                                  | 10                      | 5
Deferred income tax expense (benefit): |                         |
Federal                                | 4,206                   | 4,860
State                                  | (11,346)                | 665
Income tax expense (benefit)           | $(7,125)                | $5,534 |


| _id | d1b335206 |
| title |  |
| text | Indefinite-lived Intangible Assets
Indefinite-lived intangible assets consist entirely of acquired in-process research and development technology, or IPR&D. The following table sets forth the Company’s activities related to the indefinite-lived intangible assets:

The Company performs its annual assessment of indefinite-lived intangible assets on October 31 each year or more frequently if events or changes in circumstances indicate that the asset might be impaired utilizing a qualitative test as a precursor to the quantitative test comparing the fair value of the assets with their carrying amount. Based on the qualitative test, if it is more likely than not that indicators of impairment exists, the Company proceeds to perform a quantitative analysis. Based on the

to perform a quantitative analysis. Based on the Company’s assessment as of October 31, 2019, no indicators of impairment were identified.

In the years ended December 31, 2019 and 2018, no IPR&D impairment losses were recorded. In the year ended December 31, 2017, the Company recognized impairment losses of $2.0 million related to the Company's abandonment of a single IPR&D project.

 |
| table | Years Ended December 31,                     |         |
-------------------------------------------- | ------- | ------
                                             | 2019    | 2018
(in thousands)                               |         |
Beginning balance                            | $4,400  | $4,400
Transfers to developed technology from IPR&D | (4,400) | —
Ending balance                               | $—      | $4,400 |


| _id | d1b32be18 |
| title |  |
| text | Capital Expenditures

Our 2020 capital program includes capital to fund advanced networks and services, including expanding our core networks, adding capacity and density to our 4G LTE network in order to stay ahead of our customers’ increasing data demands and deploying our 5G network, transforming our structure to deploy the Intelligent Edge Network while reducing the cost to deliver services to our customers, and pursuing other opportunities to drive operating efficiencies. We expect that the new network architecture will

We expect that the new network architecture will simplify operations by eliminating legacy network elements, improve our 4G LTE coverage, speed the deployment of 5G technology, and create new enterprise opportunities in the business market. The level and the timing of the Company’s capital expenditures within these broad categories can vary significantly as a result of a variety of factors outside of our control, such as material weather events, equipment availability from vendors and permits from local

availability from vendors and permits from local governments. Capital expenditures for 2020 are expected to be in the range of $17.0 billion to $18.0 billion, including the continued investment in our 5G network. Capital expenditures were $17.9 billion in 2019 and $16.7 billion in 2018. We believe that we have significant discretion over the amount and timing of our capital expenditures on a Company-wide basis as we are not subject to any agreement that would require significant capital expenditures on a

require significant capital expenditures on a designated schedule or upon the occurrence of designated events.

Consolidated Financial Condition
We use the net cash generated from our operations to fund expansion and modernization of our networks, service and repay external financing, pay dividends, invest in new businesses and spectrum and, when appropriate, buy back shares of our outstanding common stock. Our sources of funds, primarily from operations and, to the extent necessary, from external financing arrangements, are sufficient to meet ongoing operating and investing requirements.

We expect that our capital spending requirements will continue to be financed primarily through internally generated funds. Debt or equity financing may be needed to fund additional investments or development activities or to maintain an appropriate capital structure to ensure our financial flexibility. Our cash and cash equivalents are held both domestically and internationally, and are invested to maintain principal and provide liquidity. See “Market Risk” for additional information regarding our foreign

for additional information regarding our foreign currency risk management strategies.

Our available external financing arrangements include an active commercial paper program, credit available under credit facilities and other bank lines of credit, vendor financing arrangements, issuances of registered debt or equity securities, U.S. retail medium-term notes and other capital market securities that are privately-placed or offered overseas. In addition, we monetize our device payment plan agreement receivables through asset-backed debt transactions.

 |
| table | |          | (dollars in millions)
------------------------------------------------------ | -------- | ---------------------
Years Ended December 31,                               | 2019     | 2018
Cash flows provided by (used in)                       |          |
Operating activities                                   | $ 35,746 | $ 34,339
Investing activities                                   | (17,581) | (17,934)
Financing activities                                   | (18,164) | (15,377)
Increase in cash, cash equivalents and restricted cash | $1       | $ 1,028 |


| _id | d1b3387a8 |
| title |  |
| text | Stock Repurchase Program

As of April 26, 2019, our Board of Directors has authorized the repurchase of up to $13.6 billion of our common stock under our stock repurchase program . Under this program, which we may suspend or discontinue at any time, we may purchase shares of our outstanding common stock through solicited or unsolicited transactions in the open market, in privately negotiated transactions, through accelerated share repurchase programs, pursuant to a Rule 10b5-1 plan or in such other manner as deemed appropriate by

or in such other manner as deemed appropriate by our management.

The following table summarizes activity related to this program (in millions, except per share amounts):
The aggregate purchase price of our stock repurchases for fiscal 2019 consisted of $2.1 billion of open market purchases of which $1.0 billion and $1.1 billion were allocated to additional paid-in capital and retained earnings (accumulated deficit), respectively.

Since the May 13, 2003 inception of our stock repurchase program through April 26, 2019, we repurchased a total of 313 million shares of our common stock at an average price of $37.46 per share, for an aggregate purchase price of $11.7 billion.

 |
| table | |                | Year Ended     |
---------------------------------------- | -------------- | -------------- | --------------
                                         | April 26, 2019 | April 27, 2018 | April 28, 2017
Number of shares repurchased             | 29             | 15             | 22
Average price per share                  | $ 72.87        | $ 51.57        | $ 32.72
Aggregate purchase price                 | $ 2,111        | $ 794          | $ 705
Remaining authorization at end of period | $ 1,889        | $ 4,000        | $ 794 |


| _id | d1b38abac |
| title |  |
| text | Operating income in the Industrial Solutions segment increased $78 million in fiscal 2019 from fiscal 2018. The Industrial Solutions segment’s operating income included the following:
Excluding these items, operating income increased in fiscal 2019 primarily as a result of higher volume and improved manufacturing productivity.

 |
| table | |       | Fiscal
-------------------------------------------------------------------------------------- | ----- | -------------
                                                                                | 2019  | 2018
                                                                                |       | (in millions)
Acquisition-related charges:                                                           |       |
Acquisition and integration costs                                                      | $  10 | $  6
Charges associated with the amortization of acquisition-related fair value adjustments | 3     | 4
                                                                                | 13    | 10
Restructuring and other charges, net                                                   | 63    | 80
Other items                                                                            | 2     | —
Total                                                                                | $  78 | $  90 |


| _id | d1b332380 |
| title |  |
| text | Changes in the amounts of unrecognized tax benefits were as follows:
We had gross unrecognized tax benefits of $20.6 million and $19.8 million as of December 31, 2019 and 2018, respectively. If the current gross unrecognized tax benefits were recognized, the result would be an increase in our income tax benefit of $20.7 million and $19.6 million, respectively. These amounts are net of accrued interest and penalties relating to unrecognized tax benefits of $0.4 million and $0.2 million, respectively.

We believe that it is reasonably possible that $0.2 million of our currently remaining unrecognized tax benefits may be recognized by the end of 2020, as a result of a lapse of the applicable statute of limitations.

 |
| table | |          | Year Ended December 31, |
--------------------------------------------------------- | -------- | ----------------------- | --------
(In thousands)                                            | 2019     | 2018                    | 2017
Beginning balance as of January 1                         | $ 19,821 | $ 10,939                | $ 10,616
Increases for tax positions related to the current year   | 1,240    | 8,977                   | 640
Decreases for tax positions related to prior years        | 0        | 0                       | (146)
Increases for tax positions related to prior years        | 95       | 367                     | 153
Decreases relating to settlements with taxing authorities | 0        | 0                       | 0
Increases acquired in business acquisitions               | 0        | 540                     | 0
Foreign currency translation                              | 3        | (5)                     | 10
Reductions due to lapsed statute of limitations           | (555)    | (997)                   | (334)
Ending balance as of December 31                          | $ 20,604 | $ 19,821                | $ 10,939 |


| _id | d1b3952fa |
| title |  |
| text | (13) (Loss) Earnings Per Common Share
Basic and diluted (loss) earnings per common share for the years ended December 31, 2019, 2018 and 2017 were calculated as follows:
(1) For the year ended December 31, 2019 and December 31, 2018, we excluded from the calculation of diluted loss per share 3.0 million shares and 4.6 million shares, respectively, potentially issuable under incentive compensation plans or convertible securities, as their effect, if included, would have been anti-dilutive.

Our calculation of diluted (loss) earnings per common share excludes shares of common stock that are issuable upon exercise of stock options when the exercise price is greater than the average market price of our common stock. We also exclude unvested restricted stock awards that are antidilutive as a result of unrecognized compensation cost. Such shares were 6.8 million, 2.7 million and 4.7 million for 2019, 2018 and 2017, respectively.

 |
| table | |           | Years Ended December, 31                                             |
----------------------------------------------------------------------------------------------- | --------- | -------------------------------------------------------------------- | -------
                                                                                | 2019      | 2018                                                                 | 2017
                                                                                |           | (Dollars in millions, except per share amounts, shares in thousands) |
Loss income (Numerator):                                                                        |           |                                                                      |
Net (loss) income                                                                               | $(5,269)  | (1,733)                                                              | 1,389
Net (loss) income applicable to common stock for computing basic earnings per common share      | (5,269)   | (1,733)                                                              | 1,389
Net (loss) income as adjusted for purposes of computing diluted earnings per common share       | $(5,269)  | (1,733)                                                              | 1,389
Shares (Denominator):                                                                           |           |                                                                      |
Weighted average number of shares:                                                              |           |                                                                      |
Outstanding during period                                                                       | 1,088,730 | 1,078,409                                                            | 635,576
Non-vested restricted stock                                                                     | (17,289)  | (12,543)                                                             | (7,768)
Weighted average shares outstanding for computing basic earnings per common share               | 1,071,441 | 1,065,866                                                            | 627,808
Incremental common shares attributable to dilutive securities:                                  |           |                                                                      |
Shares issuable under convertible securities                                                    | —         | —                                                                    | 10
Shares issuable under incentive compensation plans                                              | —         | —                                                                    | 875
Number of shares as adjusted for purposes of computing diluted (loss) earnings per common share | 1,071,441 | 1,065,866                                                            | 628,693
Basic (loss) earnings per common share                                                          | $(4.92)   | (1.63)                                                               | 2.21
Diluted (loss) earnings per common share(1)                                                     | $(4.92)   | (1.63)                                                               | 2.21 |


| _id | d1b342942 |
| title |  |
| text | 3. EARNINGS PER SHARE:
Basic earnings per share available to common shareholders is calculated by dividing net income less preferred stock dividend requirements by the weighted average common shares outstanding for each period. Diluted earnings per share available to common shareholders is calculated by dividing income from operations less preferred stock dividend requirements (when anti-dilutive) by the sum of the weighted average common shares outstanding and the weighted average dilutive equity awards.

 |
| table | | For Fiscal Years |
------------------------------------------------------- | ---------------- | ----------
                                                        | 2019 Basic       | 2018 Basic
Weighted average common shares outstanding              | 597,961          | 660,925
Net income available to common shareholders             | $3,202,943       | $3,614,610
Net earnings per share available to common shareholders | $5.36            | $5.47 |


| _id | d1a7255f6 |
| title |  |
| text | Note 6 Interest expense
Included in interest expense on long-term debt is interest on lease liabilities of $220 million for 2019 and interest on finance leases of $142 million for 2018.
Capitalized interest was calculated using an average rate of 3.96% and 3.88% for 2019 and 2018, respectively, which represents the weighted average interest rate on our outstanding long-term debt.

 |
| table | FOR THE YEAR ENDED DECEMBER 31     | 2019    | 2018
---------------------------------- | ------- | -------
Interest expense on long-term debt | (1,024) | (918)
Interest expense on other debt     | (153)   | (133)
Capitalized interest               | 45      | 51
Total interest expense             | (1,132) | (1,000) |


| _id | d1b3471ea |
| title |  |
| text | Pre-tax income from international operations was $214 million, $890 million, and $353 million for fiscal 2019, 2018, and 2017, respectively.
The components of income tax expense (benefit) recorded in continuing operations are as follows:

As of December 28, 2018, we have completed our accounting for the effects of the enactment of the Tax Cuts and Jobs Act (H.R.1) (the 2017 Tax Act) in accordance with U.S. Securities and Exchange Commission (SEC) Staff Accounting Bulletin No. 118, and the amounts are no longer considered provisional. We will continue to evaluate any new guidance from the U.S. Department of Treasury and the Internal Revenue Service (IRS) as issued.

 |
| table | |                | Year Ended     |
---------------------------- | -------------- | -------------- | --------------
(In millions)                | March 29, 2019 | March 30, 2018 | March 31, 2017
Current:                     |                |                |
Federal                      | $73            | $1,011         | $108
State                        | 15             | 40             | 6
International                | 74             | 107            | 68
Total                        | 162            | 1,158          | 182
Deferred:                    |                |                |
Federal                      | (52)           | (1,664)        | (177)
State                        | (2)            | (151)          | (17)
International                | (16)           | (33)           | (14)
Total                        | (70)           | (1,848)        | (208)
Income tax expense (benefit) | $92            | $(690)         | $(26) |


| _id | d1a73f564 |
| title |  |
| text | Unrecognized Tax Benefits
We are providing the following disclosures related to our unrecognized tax benefits and the effect on our effective income tax rate if recognized:
In 2019, our unrecognized tax benefit increased by $33.9 million, primarily related to increases in North America. In 2018, we increased our unrecognized tax benefit by $142.1 million, also primarily related to North America.

If the unrecognized tax benefits at December 31, 2019 were recognized, our income tax provision would decrease by $343.5 million, resulting in a substantially lower effective tax rate. Based on the potential outcome of the Company’s global tax examinations and the expiration of the statute of limitations for specific jurisdictions, it is possible that the unrecognized tax benefits could change significantly within the next 12 months. Absent resolution of significant tax controversy, the associated impact

tax controversy, the associated impact on the reserve balance is estimated to be a decrease in the range of $4.6 to $6.6 million during 2020.

We recognize interest and penalties associated with unrecognized tax benefits in our income tax provision in the Consolidated Statements of Operations. Interest and penalties recorded were $13.1 million, negligible and $4.0 million, respectively in 2019, 2018 and 2017. We had gross liabilities, for interest and penalties, of $56.2 million at December 31, 2019, $18.2 million at December 31, 2018 and $14.8 million at December 31, 2017. The increase in the gross liability related to interest and penalties

gross liability related to interest and penalties from 2018 to 2019 was primarily due to a reclass within other non-current liabilities from unrecognized tax benefits to interest and penalties which had no impact on the overall Consolidated Balance Sheets or Consolidated Statement of Operations.

The majority of the unrecognized tax benefit amount of $390.3 million relates to North America.

 |
| table | |         | Year Ended December 31, |
--------------------------------------------------------------- | ------- | ----------------------- | -------
(in millions)                                                   | 2019    | 2018                    | 2017
Beginning balance of unrecognized tax benefits                  | $ 356.4 | $ 214.3                 | $ 162.6
Additions for tax positions of current year                     | 3.4     | 106.0                   | 7.3
Additions for tax positions of prior years                      | 47.9    | 59.5                    | 49.3
Reductions for tax positions of prior years                     | (16.0)  | (7.0)                   | (4.3)
Reductions for lapses of statutes of limitation and settlements | (1.4)   | (16.4)                  | (0.6)
Ending balance of unrecognized tax benefits                     | $ 390.3 | $ 356.4                 | $ 214.3 |


| _id | d1b351cbc |
| title |  |
| text | Note 16. Accrued Employee Compensation and Benefits
Accrued employee compensation and benefits consisted of the following (in thousands):

 |
| table | | December 31, |
-------------------------------------------- | ------------ | -------
                                             | 2019         | 2018
Accrued compensation                         | $38,186      | $34,095
Accrued bonus and commissions                | 27,039       | 19,835
Accrued vacation                             | 20,647       | 19,019
Accrued employment taxes                     | 16,468       | 15,598
Accrued severance and related costs (Note 5) | 485          | 793
Other                                        | 6,766        | 6,473
                                             | $109,591     | $95,813 |


| _id | d1b3a6884 |
| title |  |
| text | Note 15 Leases
RIGHT-OF-USE ASSETS
BCE’s significant right-of-use assets under leases are satellites, office premises, land, cellular tower sites, retail outlets and OOH advertising spaces. Right-of-use assets are presented in Property, plant and equipment in the statement of financial position.

 |
| table | FOR THE YEAR ENDED DECEMBER 31, 2019     | NETWORK INFRASTRUCTURE AND EQUIPMENT | LAND AND BUILDINGS | TOTAL
---------------------------------------- | ------------------------------------ | ------------------ | -----
COST                                     |                                      |                    |
January 1, 2019                          | 3,329                                | 2,453              | 5,782
Additions                                | 527                                  | 513                | 1,040
Transfers                                | (233)                                | –                  | (233)
Acquired through business combinations   | –                                    | 8                  | 8
Lease terminations                       | (12)                                 | (38)               | (50)
Impairment losses recognized in earnings | (2)                                  | (3)                | (5)
December 31, 2019                        | 3,609                                | 2,933              | 6,542
ACCUMULATED DEPRECIATION                 |                                      |                    |
January 1, 2019                          | 1,042                                | 536                | 1,578
Depreciation                             | 373                                  | 303                | 676
Transfers                                | (111)                                | –                  | (111)
Lease terminations                       | (3)                                  | (22)               | (25)
December 31, 2019                        | 1,301                                | 817                | 2,118
NET CARRYING AMOUNT                      |                                      |                    |
January 1, 2019                          | 2,287                                | 1,917              | 4,204
December 31, 2019                        | 2,308                                | 2,116              | 4,424 |


| _id | d1b39c12c |
| title |  |
| text | Non‐executive Director fees are paid from an aggregate annual fee pool of $4,000,000, as approved by shareholders at the AGM on 18 November 2010. Total board and committee fees paid during F19 were $2,859,903 (refer to section 5.1).
Non‐executive Directors do not receive variable pay and no Directors’ fees are paid to Executive Directors.

In recognition of the equal importance and workload of all of the Board’s Committees, the Board reviewed Non‐executive Director fees and determined to increase Chair and Member fees for the People Performance Committee and Sustainability Committee as detailed in the table below, effective 1 July 2019. The table below provides a summary of F19 and F20 Board and Committee fees:

 |
| table | | CHAIR       |             | MEMBER      |
----------------------------------------------- | ----------- | ----------- | ----------- | -----------
                                                | F19 FEE     | F20 FEE     | F19 FEE     | F20 FEE
BOARD AND COMMITTEE FEES ($)                    | INCL. SUPER | INCL. SUPER | INCL. SUPER | INCL. SUPER
Board                                           | $790,531    | $790,531    | $254,990    | $254,990
Audit, Risk Management and Compliance Committee | $65,000     | $65,000     | $32,500     | $32,500
People Performance Committee                    | $54,525     | $65,000     | $27,265     | $32,500
Sustainability Committee                        | $45,000     | $65,000     | $22,500     | $32,500
Nomination Committee                            | Nil         | Nil         | Nil         | Nil |


| _id | d1b3c874a |
| title |  |
| text | 8. Stock option and award plan: (Continued)
A summary of the Company’s non-vested restricted stock awards as of December 31, 2019 and the changes during the year ended December 31, 2019 are as follows:

The weighted average per share grant date fair value of restricted stock granted was $53.53 in 2019 (0.5 million shares) $44.02 in 2018 (0.5 million shares) and $40.52 in 2017 (0.5 million shares). The fair value was determined using the quoted market price of the Company’s common stock on the date of grant. Valuations were obtained to determine the fair value for the shares granted to the Company’s CEO that are subject to the total shareholder return of the Company’s common stock compared to the total

the Company’s common stock compared to the total shareholder return of the Nasdaq Telecommunications Index. The fair value of shares of restricted stock vested in 2019, 2018 and 2017 was $20.8 million, $19.1 million and $12.6 million, respectively.

Equity-based compensation expense related to stock options and restricted stock was $18.5 million, $17.7 million, and $13.3 million for 2019, 2018, and 2017, respectively. The income tax benefit related to stock options and restricted stock was $3.0 million, $1.8 million, and $2.5 million for 2019, 2018, and 2017, respectively. The Company capitalized compensation expense related to stock options and restricted stock for 2019, 2018, and 2017 of $1.8 million, $1.7 million and $1.2 million, respectively. As

$1.7 million and $1.2 million, respectively. As of December 31, 2019, there was $31.7 million of total unrecognized compensation cost related to non-vested equity-based compensation awards. That cost is expected to be recognized over a weighted average period of 1.9 years.

 |
| table | Non-vested awards               | Shares    | Weighted-Average Grant Date Fair Value
------------------------------- | --------- | --------------------------------------
Non-vested at December 31, 2018 | 1,187,586 | $41.12
Granted                         | 473,550   | $53.53
Vested                          | (365,223) | $41.83
Forfeited                       | (12,632)  | $50.49
Non-vested at December 31, 2019 | 1,283,281 | $45.40 |


| _id | d1b2e92ac |
| title |  |
| text | 20. DIVIDENDS
A regular dividend of 3 cents per share has been declared. This final dividend of 3 cents per share, partially franked to 2.6 cents per share, was announced to the market on 23 August 2019. The amount declared has not been recognised as a liability in the accounts of Hansen Technologies Ltd as at 30 June 2019.
1. The final dividend paid of 4 cents per share, franked to 4 cents, comprised of an ordinary dividend of 3 cents per share, together with a special dividend of 1 cent per share.

The above available amounts are based on the balance of the dividend franking account at year end adjusted for: • franking credits that will arise from the payment of any current tax liability; • franking debits that will arise from the payment of any dividends recognised as a liability at year end; • franking credits that will arise from the receipt of any dividends recognised as receivables at year end; and • franking credits that the entity may be prevented from distributing in subsequent years.

 |
| table | | 2019   | 2018
---------------------------------------------------------------------------------------------------------------------------------- | ------ | ------
                                                                                | $’000  | $’000
Dividends paid during the year (net of dividend re-investment)                                                                     |        |
4 cent per share final dividend paid 27 September 2018 – fully franked1                                                            | 7,319  |
3 cent per share final dividend paid 30 September 2017 – fully franked                                                             |        | 5,175
3 cent per share interim dividend paid 29 March 2019 – fully franked                                                               | 5,318  |
3 cent per share interim dividend paid 29 March 2018 – fully franked                                                               |        | 5,217
                                                                                | 12,637 | 10,392
Proposed dividend not recognised at the end of the year                                                                            | 5,922  | 7,865
Dividends franking account                                                                                |        |
30% franking credits, on a tax paid basis, are available to shareholders of Hansen Technologies Ltd for subsequent financial years | 1,586  | 3,125 |


| _id | d1b3032f6 |
| title |  |
| text | Financial risk management
The Group’s treasury function centrally manages the Group’s funding requirement, net foreign exchange exposure, interest rate management exposures and counterparty risk arising from investments and derivatives.
Treasury operations are conducted within a framework of policies and guidelines authorised and reviewed by the Board, most recently in July 2018

A treasury risk committee comprising of the Group’s Chief Financial Officer, Group General Counsel and Company Secretary, Group Financial Controller, Group Treasury Director and Group Director of Financial Controlling and Operations meets three times a year to review treasury activities and its members receive management information relating to treasury activities on a quarterly basis. The Group’s accounting function, which does not report to the Group Treasury Director, provides regular update reports of

Director, provides regular update reports of treasury activity to the Board. The Group’s internal auditor reviews the internal control environment regularly.

The Group uses a number of derivative instruments for currency and interest rate risk management purposes only that are transacted by specialist treasury personnel. The Group mitigates banking sector credit risk by the use of collateral support agreements.
Credit risk

Credit risk
Credit risk is the risk that a counterparty will not meet its obligations under a financial asset leading to a financial loss for the Group. The Group is exposed to credit risk from its operating activities and from its financing activities, the Group considers its maximum exposure to credit risk at 31 March to be:
Expected credit loss

Expected credit loss
The Group has financial assets classified and measured at amortised cost and fair value through other comprehensive income that are subject to the expected credit loss model requirements of IFRS 9. Cash at bank and in hand and certain other investments are both classified and measured at amortised cost and subject to these impairment requirements. However, the identified expected credit loss is considered to be immaterial.

Information about expected credit losses for trade receivables and contract assets can be found under “operating activities” on page 164.

 |
| table | | 2019 €m | 2018 €m
--------------------------------------- | ------- | -------
Cash at bank and in hand                | 2,434   | 2,197
Repurchase agreements and bank deposits | 2,196   | –
Money market funds                      | 9,007   | 2,477
Managed investment funds                | 6,405   | 3,891
Government securities                   | 3,011   | 1,974
Other investments                       | 4,418   | 6,087
Derivative financial instruments        | 3,634   | 2,629
Trade receivables                       | 5,077   | 5,402
Contract assets and other receivables   | 5,155   | 3,410
                                        | 41,337  | 28,067 |


| _id | d1a72031c |
| title |  |
| text | The reconciliation from non-current segment assets to non-current group assets is shown in the following table: non-current assets according to segment reporting only include the values of continuing operations in the previous year. Therefore, the non-current assets of METRO China must be taken into account in the previous year and are therefore part of the reconciliation:
1 Adjustment of previous year according to explanation in notes.

 |
| table | € million                                         | 30/9/2018 | 30/9/2019
------------------------------------------------- | --------- | ---------
Non-current segment assets                        | 6,348     | 6,268
plus non-current segment assets METRO China       | 560       | 0
Financial assets                                  | 88        | 97
Investments accounted for using the equity method | 178       | 179
Deferred tax assets                               | 329       | 191
Other                                             | 1         | 1
Non-current group assets                          | 7,503     | 6,736 |


| _id | d1b38f0b2 |
| title |  |
| text | 3.5 INCOME TAXES
(1) Fiscal 2018 was restated to comply with IFRS 15 and to reflect a change in accounting policy as well as to reclassify results from Cogeco Peer 1 as discontinued operations. For further details, please consult the "Accounting policies" and "Discontinued operations" sections.

Fiscal 2019 income taxes expense amounted to $83.7 million compared to a recovery of $17.2 million for the prior year mainly attributable to: • the effect of the federal rate reduction in the second quarter of fiscal 2018 in the United States; • the increase in profit before income taxes which is mostly related to the impact of the MetroCast acquisition completed in the second quarter of fiscal 2018, and • the appreciation of the US dollar against the Canadian dollar compared to the prior year.

On March 19, 2019, the Department of Finance Canada confirmed the acceleration of tax depreciation on most capital investments for property, plant and equipment acquired after November 20, 2018, which phases out during the period from 2023 to 2028. The federal accelerated tax depreciation had a favorable impact on the current income tax expense of the Corporation in fiscal 2019. On March 21, 2019, the Québec Department of Finance confirmed that it would harmonize with the Federal legislation.

On December 22, 2017, the U.S. federal government enacted the Tax Cuts and Jobs Act (the "Act"). The tax reform reduced the general federal corporate tax rate from 35% to 21% starting after 2017 which reduced net deferred tax liabilities by approximately $94 million (US$74 million) in the second quarter of fiscal 2018. In addition, the Act calls for other changes such as interest deductibility limitations, full deduction of acquisitions of tangible assets, net operating losses limitations as well as base

net operating losses limitations as well as base erosion anti-avoidance, which together with tax rate reductions, had an overall favorable impact on the income tax expense.

 |
| table | Years ended August 31,                                                             | 2019     | 2018 (1) | Change
---------------------------------------------------------------------------------- | -------- | -------- | ------
(in thousands of dollars, except percentages)                                      | $        | $        | %
Profit before income taxes                                                         | 440,563  | 367,380  | 19.9
Combined Canadian income tax rate                                                  | 26.50%   | 26.50%   | —
Income taxes at combined Canadian income tax rate                                  | 116,749  | 97,356   | 19.9
Difference in operations' statutory income tax rates                               | 1,466    | (3)      | —
Impact on deferred taxes as a result of changes in substantively enacted tax rates | 15       | (94,175) | —
Impact on income taxes arising from non-deductible expenses and non-taxable profit | (565)    | 1,670    | —
Tax impacts related to foreign operations                                          | (28,633) | (22,099) | 29.6
Other                                                                              | (5,377)  | 53       | —
                                                                                | 83,655   | (17,198) | — |


| _id | d1b348cde |
| title |  |
| text | Contractual Obligations As of December 31, 2019, our contractual obligations were as follows:
(1) Interest on long-term debt includes amounts due on fixed and variable rate debt. As the rates on our variable debt are subject to change, the rates in effect at December 31, 2019 were used in determining our future interest obligations. Expected settlements of interest rate swap agreements were estimated using yield curves in effect at December 31, 2019.

(2) Unrecorded purchase obligations include binding commitments for future capital expenditures and service and maintenance agreements to support various computer hardware and software applications and certain equipment. If we terminate any of the contracts prior to their expiration date, we would be liable for minimum commitment payments as defined by the contractual terms of the contracts.

(3) Recorded obligations include amounts in accounts payable and accrued expenses for external goods and services received as of December 31, 2019 and expected to be settled in cash.
(4) Expected contributions to our pension and post-retirement benefit plans for the next 5 years. Actual contributions could differ from these estimates and extend beyond 5 years.

Defined Benefit Pension Plans As required, we contribute to qualified defined pension plans and non-qualified supplemental retirement plans (collectively the “Pension Plans”) and other post-retirement benefit plans, which provide retirement benefits to certain eligible employees. Contributions are intended to provide for benefits attributed to service to date. Our funding policy is to contribute annually an actuarially determined amount consistent with applicable federal income tax regulations.

The cost to maintain our Pension Plans and future funding requirements are affected by several factors including the expected return on investment of the assets held by the Pension Plans, changes in the discount rate used to calculate pension expense and the amortization of unrecognized gains and losses. Returns generated on the Pension Plans assets have historically funded a significant portion of the benefits paid under the Pension Plans. We used a weighted-average expected long-term rate of return of

expected long-term rate of return of 6.97% and 7.03% in 2019 and 2018, respectively. As of January 1, 2020, we estimate the longterm rate of return of Plan assets will be 6.25%. The Pension Plans invest in marketable equity securities which are exposed to changes in the financial markets. If the financial markets experience a downturn and returns fall below our estimate, we could be required to make material contributions to the Pension Plans, which could adversely affect our cash flows from operations.

Net pension and post-retirement costs were $11.5 million, $5.6 million and $3.8 million for the years ended December 31, 2019, 2018 and 2017, respectively. We contributed $27.5 million, $26.2 million and $12.5 million in 2019, 2018 and 2017, respectively to our Pension Plans. For our other post-retirement plans, we contributed $8.5 million, $9.7 million and $6.5 million in 2019, 2018 and 2017, respectively. In 2020, we expect to make contributions totaling approximately $25.0 million to our Pension Plans

approximately $25.0 million to our Pension Plans and $8.9 million to our other post-retirement benefit plans. Our contribution amounts meet the minimum funding requirements as set forth in employee benefit and tax laws. See Note 11 to the consolidated financial statements for a more detailed discussion regarding our pension and other post-retirement plans.

 |
| table | (In thousands)                             | Less than 1 Year | 1 -3 Years | 3 -5 Years  | Thereafter | Total
------------------------------------------ | ---------------- | ---------- | ----------- | ---------- | -----------
Long-term debt                             | $ 18,350         | $ 521,700  | $ 1,729,663 | $ —        | $ 2,269,713
Interest on long-term debt obligations (1) | 128,731          | 246,834    | 65,552      | —          | 441,117
Finance leases                             | 10,280           | 8,285      | 3,404       | 6,604      | 28,573
Operating leases                           | 7,860            | 10,751     | 5,660       | 10,691     | 34,962
Unconditional purchase obligations:        |                  |            |             |            |
Unrecorded (2)                             | 36,488           | 37,830     | 19,954      | 1,371      | 95,643
Recorded (3)                               | 98,035           | —          | —           | —          | 98,035
Pension funding (4)                        | 33,861           | 64,311     | 65,959      | —          | 164,131 |


| _id | d1b353490 |
| title |  |
| text | 9. Available-for-Sale Debt Investments and Equity Investments
The following table summarizes our available-for-sale debt investments and equity investments (in millions):
(1) We held equity interests in certain private equity funds of $0.6 billion as of July 27, 2019 which are accounted for under the NAV practical expedient following the adoption of ASU 2016-01, Financial Instruments, starting in the first quarter of fiscal 2019.

 |
| table | | July 27, 2019 | July 28, 2018
------------------------------------------------------------- | ------------- | -------------
Available-for-sale debt investments                           | $21,660       | $37,009
Marketable equity securities                                  | 3             | 605
Total investments                                             | 21,663        | 37,614
Non-marketable equity securities included in other assets (1) | 1,113         | 978
Equity method investments included in other assets            | 87            | 118
Total                                                         | $22,863       | $38,710 |


| _id | d1b38aa08 |
| title |  |
| text | Restricted Stock Units

At September 2019, the Compensation Committee of the Board of Directors had authorized and approved the following restricted stock unit awards to members of the Company’s management team pursuant to the provisions of the Company’s Omnibus Plans: At September 2019, the Compensation Committee of the Board of Directors had authorized and approved the following restricted stock unit awards to members of the Company’s management team pursuant to the provisions of the Company’s Omnibus Plans:

(1) 13,150 of the restricted stock units were vested as of September 2019. The remaining 100 restricted stock units
will vest in equal amounts in October 2019 and October 2020.
(2) 8,666 of the restricted stock units were vested as of September 2019. The remaining 4,334 restricted stock units
will vest in October 2019.
(3) 4,333 of the restricted stock units were vested as of September 2019. 4,333 restricted stock units will vest in
October 2019 and 4,334 will vest in October 2020.

October 2019 and 4,334 will vest in October 2020.
(4) The 15,050 restricted stock units will vest in equal amounts in October 2019, October 2020, and October 2021.

There is no direct cost to the recipients of the restricted stock units, except for any applicable taxes. The recipients of the restricted stock units are entitled to the customary adjustments in the event of stock splits, stock dividends, and certain other distributions on the Company’s common stock. All cash dividends and/or distributions payable to restricted stock recipients will be held in escrow until all the conditions of vesting have been met.

The restricted stock units provide that the recipients can elect, at their option, to receive either common stock in the
Company, or a cash settlement based upon the closing price of the Company’s shares, at the time of vesting. Based on
these award provisions, the compensation expense recorded in the Company’s Statement of Operations reflects the
straight-line amortized fair value based on the liability method under “ASC 718 – Compensation – Stock Compensation”.

Net income before income taxes included compensation expense related to the amortization of the Company’s restricted stock unit awards of approximately $1.2 million during both fiscal 2019 and fiscal 2018. These amounts were recorded as accrued expenses in the Company’s Consolidated Balance Sheet at both September 2019 and September 2018. The tax benefit related to this compensation expense was approximately $0.3 million in both fiscal 2019 and fiscal 2018. The total intrinsic value of restricted stock

The total intrinsic value of restricted stock units vested during fiscal 2019 and fiscal 2018 was approximately $1.1 million and $1.2 million, respectively.

 |
| table | | Restricted Stock Units(1) | Restricted Stock Units(2) | Restricted Stock Units(3) | Restricted Stock Units(4)
-------------------------------------------- | ------------------------- | ------------------------- | ------------------------- | -------------------------
Date of award:                               | October 2015              | October 2016              | October 2017              | October 2018
Original number of awards issued:            | 13,250                    | 13,000                    | 13,000                    | 15,050
Service period:                              | 36 - 60 months            | 36 months                 | 36 months                 | 36 months
Estimated fair value of award at grant date: | $1,112,000                | $1,191,000                | $1,177,000                | $ 1,264,000
Non-vested awards outstanding at             |                           |                           |                           |
September 30, 2019:                          | 100                       | 4,334                     | 8,667                     | 15,050
Fair value of non-vested awards at           |                           |                           |                           |
September 30, 2019 of approximately:         | $8,000                    | $330,000                  | $661,000                  | $ 1,148,000 |


| _id | d1b37bee0 |
| title |  |
| text | Contributions and Direct Benefit Payments
It is the company’s general practice to fund amounts for pensions sufficient to meet the minimum requirements set forth in applicable employee benefits laws and local tax laws. From time to time, the company contributes additional amounts as it deems appropriate.

The following table presents the contributions made to the non-U.S. DB plans, non pension postretirement benefit plans, multi-employer plans, DC plans and direct payments for 2019 and 2018. The cash contributions to the multi-employer plans represent the annual cost included in the net periodic (income)/ cost recognized in the Consolidated Income Statement. The company’s participation in multi-employer plans has no material impact on the company’s financial statements.

In 2019 and 2018, $635 million and $598 million, respectively, was contributed in U.S. Treasury securities, which is considered a non-cash transaction (includes the Active Medical Trust).

 |
| table | ($ in millions)                          |        |
---------------------------------------- | ------ | ------
For the year ended December 31:          | 2019   | 2018
Non-U.S. DB plans                        | $  243 | $  325
Non pension postretirement benefit plans | 304    | 335
Multi-employer plans                     | 32     | 38
DC plans                                 | 1,040  | 1,024
Direct benefit payments                  | 559    | 567
Total                                    | $2,177 | $2,288 |


| _id | d1b390430 |
| title |  |
| text | The following table summarizes our long-lived assets (consisting of property, plant and equipment) by geography at the end of fiscal 2019, fiscal 2018 and fiscal 2017 (in millions).
We have many suppliers of raw materials and subcontractors which provide our various materials and service needs. We generally seek to have multiple sources of supply for our raw materials and services, but, in some cases, we may rely on a single or limited number of suppliers.

 |
| table | |        | March 31, |
----------------------- | ------ | --------- | ------
                        | 2019   | 2018      | 2017
United States           | $521.1 | $393.3    | $388.5
Thailand                | 209.3  | 215.5     | 178.0
Various other countries | 266.3  | 159.1     | 116.8
Total long-lived assets | $996.7 | $767.9    | $683.3 |


| _id | d1b3153de |
| title |  |
| text | Realization of net operating loss carryforwards and other deferred tax temporary differences are contingent upon future taxable earnings. The Company’s deferred tax assets were reviewed for expected utilization by assessing the available positive and negative factors surrounding their recoverability.

As of September 30, 2018, the Company’s remaining valuation allowance of approximately $105,000 related to state net operating loss carry forwards. During the fourth quarter of 2019, the Company reversed approximately $58,000 of its valuation allowance. This consisted of decreasing the valuation allowance for the expiration and utilization of state net operating losses in 2019 of approximately $68,000 and increasing the valuation allowance by approximately $10,000 for future expected NOL utilization based

$10,000 for future expected NOL utilization based on updated profitability estimates and changes to the loss utilization rules. The remaining valuation allowance balance as of September 30, 2019 of approximately $47,000 relates entirely to state net operating loss carry forwards we do not expect to utilize. The Company will continue to assess the assumptions used to determine the amount of our valuation allowance and may adjust the valuation allowance in future periods based on changes in assumptions of

future periods based on changes in assumptions of estimated future income and other factors. If the valuation allowance is reduced, we would record an income tax benefit in the period the valuation allowance is reduced. If the valuation allowance is increased, we would record additional income tax expense.

Significant components of deferred income tax assets and liabilities are as follows at:

 |
| table | | September 30, 2019 | September 30, 2018
--------------------------------------------- | ------------------ | ------------------
Deferred income tax assets (liabilities):     |                    |
Intangibles                                   | $(75,190)          | $(70,467)
Property and equipment depreciation           | (521,586)          | (552,119)
Net operating loss carry forwards and credits | 377,505            | 464,274
Stock-based compensation                      | 114,118            | 151,558
Inventories                                   | 350,197            | 400,111
Prepaid expenses                              | (63,252)           | (60,806)
Accrued expenses and reserves                 | 371,414            | 250,787
Goodwill                                      | (607,882)          | (583,415)
Gross deferred tax liability                  | (54,676)           | (77)
Valuation allowance                           | (47,014)           | (104,858)
Net deferred tax liability                    | $(101,690)         | $(104,935) |


| _id | d1a740a0e |
| title |  |
| text | 8. Credit Facilities and Long-Term Debt
Long-term debt consisted of the following (in thousands except interest rate and installment data):

Certain property, plant, and equipment is pledged as collateral on our note payable. Unless otherwise approved by our lender, we are required by provisions of our loan agreement to (1) maintain minimum levels of working capital (ratio of not less than 1.25 to 1) and net worth (minimum of $90.0 million tangible net worth, plus 45% of cumulative net income); (2) limit dividends paid in any given quarter to not exceed an amount equal to one third of the previous quarter’s consolidated net income (allowed if

quarter’s consolidated net income (allowed if no events of default), (3) maintain minimum total funded debt to total capitalization (debt to total tangible capitalization not to exceed 55%); and (4) maintain various current and cash-flow coverage ratios (1.25 to 1), among other restrictions. Our debt agreement requires Fred R. Adams, Jr., the Company’s Founder and Chairman Emeritus, or his family, to maintain ownership of Company shares, directly or indirectly, representing not less than 50% of the

indirectly, representing not less than 50% of the outstanding voting power of the Company. Certain property, plant, and equipment is pledged as collateral on our note payable. Unless otherwise approved by our lender, we are required by provisions of our loan agreement to (1) maintain minimum levels of working capital (ratio of not less than 1.25 to 1) and net worth (minimum of $90.0 million tangible net worth, plus 45% of cumulative net income); (2) limit dividends paid in any given quarter to not exceed

dividends paid in any given quarter to not exceed an amount equal to one third of the previous quarter’s consolidated net income (allowed if no events of default), (3) maintain minimum total funded debt to total capitalization (debt to total tangible capitalization not to exceed 55%); and (4) maintain various current and cash-flow coverage ratios (1.25 to 1), among other restrictions. Our debt agreement requires Fred R. Adams, Jr., the Company’s Founder and Chairman Emeritus, or his family, to maintain

and Chairman Emeritus, or his family, to maintain ownership of Company shares, directly or indirectly, representing not less than 50% of the outstanding voting power of the Company.

Interest, net of amount capitalized, of $644,000, $265,000, and $318,000 was recorded during fiscal 2019, 2018 and 2017, respectively. Interest of zero, $217,000 and $1.1 million was capitalized for construction of certain facilities during fiscal 2019, 2018 and 2017, respectively

On July 10, 2018, we entered into a $100.0 million Senior Secured Revolving Credit Facility (the “Revolving Credit Facility”) with a five-year term. The credit agreement for the Revolving Credit Facility includes an accordion feature permitting the Company, with the consent of the administrative agent, to increase the revolving commitments in the aggregate up to $125.0 million. No amounts were borrowed under the facility as of June 1, 2019 or during fiscal 2019. The Company had $3.7 million of outstanding

2019. The Company had $3.7 million of outstanding standby letters of credit issued under the Revolving Credit Facility at June 1, 2019.

The interest rate is based, at the Company’s election, on either the Eurodollar Rate plus the Applicable Margin or the
Base Rate plus the Applicable Margin. The “Eurodollar Rate” means the reserve adjusted rate at which Eurodollar
deposits in the London interbank market for an interest period of one, two, three, six or twelve months (as selected by

the Company) are quoted. The “Base Rate” means a fluctuating rate per annum equal to the highest of (a) the federal funds rate plus 0.50% per annum, (b) the prime rate of interest established by the administrative agent, and (c) the Table of Contents 54 Eurodollar Rate for an interest period of one month plus 1% per annum, subject to certain interest rate floors. The “Applicable Margin” means 0.00% to 0.75% per annum for Base Rate Loans and 1.00% to 1.75% per annum for Eurodollar Rate Loans, in each case

per annum for Eurodollar Rate Loans, in each case depending upon the average outstanding balance at the quarterly pricing date. The Company will pay a commitment fee of 0.20% on the unused portion of the facility.

The Revolving Credit Facility is guaranteed by all the current and future wholly-owned direct and indirect domestic subsidiaries of the Company, and is secured by a first-priority perfected security interest in substantially all of the Company’s and the guarantors’ accounts, payment intangibles, instruments (including promissory notes), chattel paper, inventory (including farm products) and deposit accounts maintained with the administrative agent.

The credit agreement for the Revolving Credit Facility contains customary covenants, including restrictions on the incurrence of liens, incurrence of additional debt, sales of assets and other fundamental corporate changes and investments. The credit agreement requires maintenance of two financial covenants (i) a minimum working capital ratio of 2.00 to 1.00 and (ii) an annual limit on capital expenditures of $100.0 million. Additionally, the credit agreement requires that Fred R. Adams Jr., his spouse,

requires that Fred R. Adams Jr., his spouse, natural children, sons-in-law or grandchildren, or any trust, guardianship, conservatorship or custodianship for the primary benefit of any of the foregoing, or any family limited partnership, similar limited liability company or other entity that 100% of the voting control of such entity is held by any of the foregoing, shall maintain at least 50% of the Company’s voting stock. Failure to satisfy any of these covenants will constitute a default under the terms

will constitute a default under the terms of the credit agreement. Further, dividends are restricted to the Company’s current dividend policy of one-third of the Company’s net income computed in accordance with generally accepted accounting principles. The Company is allowed to repurchase up to $75.0 million of its capital stock in any year provided there is no default under the credit agreement and the Company has availability of at least $20.0 million under the facility.

The credit agreement for the Revolving Credit Facility also includes customary events of default and customary remedies upon the occurrence of an event of default, including acceleration of the amounts due and foreclosure of the collateral.
At June 1, 2019, we were in compliance with the covenant requirements of all loan agreements.

 |
| table | | June 1, 2019 | June 2, 2018
---------------------------------------------------------------------------------------------------------------- | ------------ | ------------
Note payable at 6.20%, due in monthly principal installments of $250,000, plus interest, maturing in fiscal 2020 | $1,500       | $4,500
Note payable at 5.40%, due in monthly principal installments of $125,000, plus interest, matured in fiscal 2019  | —            | 250
Capital lease obligations                                                                                | 1,054        | 1,340
                                                                                | 2,554        | 6,090
Less: capitalized loan costs                                                                                | 217          | —
Total debt                                                                                | 2,337        | 6,090
Less: current maturities                                                                                | 1,696        | 3,536
Long-term debt, less current maturities                                                                          | $641         | $2,554 |


| _id | d1b34c1cc |
| title |  |
| text | Grants of Plan-Based Awards
The following table sets forth the estimated possible payouts under the cash incentive awards granted to our Named
Executive Officers in respect of 2019 performance under the 2019 NEO Plan.
(1) Amounts presented assume payment of threshold, target and maximum awards at the applicable level.

 |
| table | Name              | Grant Date |               | Estimated Future Payouts Under Non-Equity Incentive Plan Awards (1) |             | All Other Stock Awards: Number of Shares of Stock or  Units (#) | All Other Option Awards: Number of Securities Underlying Options (#) | Exercise or Base Price of Option Awards ($/Sh) | Grant Date Fair Value of Stock and Option Awards
----------------- | ---------- | ------------- | ------------------------------------------------------------------- | ----------- | --------------------------------------------------------------- | -------------------------------------------------------------------- | ---------------------------------------------- | ------------------------------------------------
                  |            | Threshold ($) | Target ($)                                                          | Maximum ($) |                                                                 |                                                                      |                                                |
Barry Litwin      | -          | 100,238       | 1,113,750                                                           | 1,237,500   |                                                                 |                                                                      |                                                |
Thomas Clark      | -          | 5,062         | 225,000                                                             | 337,500     |                                                                 |                                                                      |                                                |
Robert Dooley     | -          | 13,837        | 615,000                                                             | 922,500     |                                                                 |                                                                      |                                                |
Eric Lerner       | -          | 6,773         | 300,900                                                             | 451,350     |                                                                 |                                                                      |                                                |
Manoj Shetty      | -          | 5,435         | 241,535                                                             | 362,303     |                                                                 |                                                                      |                                                |
Lawrence Reinhold | N/A        | N/A           | N/A                                                                 | N/A         |                                                                 |                                                                      |                                                | |


| _id | d1b33fbac |
| title |  |
| text | GreenSky, Inc. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) (United States Dollars in thousands, except per share data, unless otherwise stated)
The following table reflects the cash flow impact of GS Holdings on the Consolidated Statements of Cash Flows for the years indicated.

 |
| table | | Year Ended December 31, |
------------------------------------------------------------------------ | ----------------------- | ---------
                                                                         | 2019                    | 2018
Net cash provided by operating activities                                | $153,327                | $256,426
Net cash used in investing activities                                    | (15,381)                | (6,581)
Net cash used in financing activities                                    | (159,608)               | (154,210)
Net increase (decrease) in cash and cash equivalents and restricted cash | (21,662)                | 95,635
Cash and cash equivalents and restricted cash at beginning of period     | 449,473                 | 353,838
Cash and cash equivalents and restricted cash at end of period           | $427,811                | $449,473 |


| _id | d1b39ea4e |
| title |  |
| text | 5. Trade Accounts Receivable and Contract Liabilities:
Charges related to allowances for doubtful accounts are charged to selling, general, and administrative expenses. Charges related to stock rotation, ship from stock and debit, sales returns, and sales discounts are reported as deductions from revenue. Please refer to Note 6, “Revenue Recognition,” for additional information

 |
| table | | Fiscal Year Ended March 31, |
-------------------------------------------- | --------------------------- | --------
                                             | 2018                        | 2019
Gross Accounts Receivable - Trade            | $300,016                    | $273,053
Less                                         |                             |
Allowances for doubtful accounts             | 1,893                       | 1,276
Stock rotation and ship from stock and debit | 15,989                      | 14,140
Sales returns and discounts                  | 6,875                       | 646
Total allowances                             | 24,757                      | 16,062
Accounts Receivable - Trade, net             | $275,259                    | $256,991 |


| _id | d1b370f68 |
| title |  |
| text | D) SHARE-BASED PAYMENT PLANS

The Corporation offers an Employee Stock Purchase Plan for the benefit of its employees and those of its subsidiaries and a Stock Option Plan to its executive officers and designated employees. No more than 10% of the outstanding subordinate voting shares are available for issuance under these plans. Furthermore, the Corporation offers an Incentive Share Unit Plan ("ISU Plan") and a Performance Share Unit Plan ("PSU Plan") for executive officers and designated employees, and a Deferred Share Unit Plan

employees, and a Deferred Share Unit Plan ("DSU Plan") for members of the Board of Directors ("Board").

Stock purchase plan The Corporation offers, for the benefit of its employees and those of its subsidiaries, an Employee Stock Purchase Plan, which is accessible to all employees up to a maximum of 7% of their base annual salary and the Corporation contributes 25% of the employee contributions. The subscriptions are made monthly and employee subordinate voting shares are purchased on the stock market.

Stock option plan A total of 3,432,500 subordinate voting shares are reserved for the purpose of the Stock Option Plan. The minimum exercise price at which options are granted is equal to the market value of such shares at the time the option is granted. Options vest equally over a period of five years beginning one year after the day such options are granted and are exercisable over ten years.

Under the Stock Option Plan, the following options were granted by the Corporation and are outstanding at August 31:
(1) For the year ended August 31, 2019, the Corporation granted 97,725 (126,425 in 2018) stock options to Cogeco's executive officers as executive officers of the Corporation. (2) The weighted average share price for options exercised during the year was $92.43 ($83.46 in 2018).

 |
| table | Years ended August 31,             |           | 2019                            |          | 2018
---------------------------------- | --------- | ------------------------------- | -------- | -------------------------------
                                   | Options   | Weighted average exercise price | Options  | Weighted average exercise price
                                   |           | $                               |          | $
Outstanding, beginning of the year | 819,393   | 65.27                           | 652,385  | 56.61
Granted (1)                        | 201,525   | 65.62                           | 281,350  | 85.08
Exercised (2)                      | (170,754) | 57.28                           | (60,337) | 57.77
Cancelled                          | (134,550) | 72.43                           | (54,005) | 72.28
Outstanding, end of the year       | 715,614   | 65.93                           | 819,393  | 65.27
Exercisable, end of the year       | 264,374   | 55.99                           | 277,108  | 49.76 |


| _id | d1b394292 |
| title |  |
| text | Statements of cash flows additional information (in millions):
Non-cash investing and financing activities and supplemental cash flow information are as follows:

 |
| table | |                | Year Ended     |
--------------------------------------------------------------- | -------------- | -------------- | --------------
                                                                | April 26, 2019 | April 27, 2018 | April 28, 2017
Non-cash Investing and Financing Activities:                    |                |                |
Capital expenditures incurred but not paid                      | $ 9            | $ 24           | $ 19
Non-cash extinguishment of sale-leaseback financing obligations | $ —            | $ 130          | $ 19
Supplemental Cash Flow Information:                             |                |                |
Income taxes paid, net of refunds                               | $ 205          | $ 87           | $ 102
Interest paid                                                   | $ 53           | $ 58           | $ 44 |


| _id | d1b3a3eb8 |
| title |  |
| text | Deferred tax assets and liabilities as of March 31, are as follows:

At March 31, 2019, we had $199.1 million of a federal net operating loss carryforwards that expire, if unused, in fiscal years 2031 to 2038, and $11.5 million of federal net operating loss carryforwards that can be carried forward indefinitely. Our Hong Kong, Malaysia, and Singapore subsidiaries have $0.4 million, $0.1 million, and $0.2 million of net operating loss carryforwards respectively. The losses for Hong Kong, Malaysia and Singapore can be carried forward indefinitely.

At March 31, 2019 our India subsidiary had $0.4 million of minimum alternative tax credits reported as other noncurrent assets on our Consolidated Balance Sheet. Our India subsidiary operates in a “Special Economic Zone (“SEZ”)”. One of the benefits associated with the SEZ is that the India subsidiary is not subject to regular India income taxes during its first 5 years of operations. The aggregate value of the benefit of the SEZ during the current fiscal year is $0.5 million.

At March 31, 2019 we also had $127.5 million of state net operating loss carryforwards that expire, if unused, in fiscal years 2020 through 2039.

We recorded valuation allowances related to certain deferred income tax assets due to the uncertainty of the ultimate realization of the future benefits from those assets. At March 31, 2019, the total valuation allowance against deferred tax assets of $57.9 million was comprised of $57.0 million for federal and state deferred tax assets, and $0.9 million associated with deferred tax assets in Hong Kong, Malaysia, Singapore and the Philippines.

In assessing the realizability of deferred tax assets, management considers whether it is more-likely-than-not that some or all of the deferred tax assets will not be realized. We have recorded a valuation allowance offsetting substantially all of our deferred tax assets. The ultimate realization of deferred tax assets depends on the generation of future taxable income during the periods in which those temporary differences are deductible.

Management considers the scheduled reversal of deferred tax liabilities (including the impact of available carryback and carryforward periods), projected taxable income, and tax planning strategies in making this assessment. In order to fully realize the deferred tax assets, we will need to generate future taxable income before the expiration of the deferred tax assets governed by the tax code.

Because of our losses in current and prior periods, management believes that it is more-likely-than-not that we will not realize the benefits of these deductible differences. The amount of the valuation allowance, however, could be reduced in the near term. The exact timing will be based on the level of profitability that we are able to achieve and our visibility into future results. Our recorded tax rate may increase in subsequent periods following a valuation release. Any valuation allowance release will

release. Any valuation allowance release will not affect the amount of cash paid for income taxes.

The undistributed earnings of our foreign subsidiaries are not subject to U.S. federal and state income taxes unless such earnings are distributed in the form of dividends or otherwise to the extent of current and accumulated earnings and profits. The undistributed earnings of foreign subsidiaries are permanently reinvested and totaled $3.1 million and $1.7 million as of March 31, 2019 and 2018, respectively.

We made the determination of permanent reinvestment on the basis of sufficient evidence that demonstrates we will invest the undistributed earnings overseas indefinitely for use in working capital, as well as foreign acquisitions and expansion. The determination of the amount of the unrecognized deferred U.S. income tax liability related to the undistributed earnings is not practicable.

Prior to the adoption of ASU 2016-09 in the first quarter of fiscal 2018, we used the with-and-without approach for ordering tax benefits derived from the share-based payment awards. Using the with-and-without approach, actual income taxes payable for the period were compared to the amount of tax payable that would have been incurred absent the deduction for employee share-based payments in excess of the amount of compensation cost recognized for financial reporting.

As a result of this approach, tax net operating loss carryforwards not generated from share-based payments in excess of cost recognized for financial reporting were considered utilized before the current period's share-based deduction.

 |
| table | (In thousands)                                 | 2019     | 2018
---------------------------------------------- | -------- | --------
Deferred tax assets:                           |          |
Accrued liabilities                            | $3,944   | $2,720
Allowance for doubtful accounts                | 120      | 143
Inventory valuation reserve                    | 41       | 20
Federal losses and credit carryforwards        | 45,227   | 42,713
Foreign net operating losses                   | 730      | 623
State losses and credit carryforwards          | 9,886    | 9,592
Deferred revenue                               | 488      | 652
Goodwill and other intangible assets           | —        | 286
Other                                          | 65       | 96
                                               | 60,501   | 56,845
Less: valuation allowance                      | (57,852) | (54,260)
Total                                          | 2,649    | 2,585
Deferred tax liabilities:                      |          |
Property and equipment & software amortization | (361)    | (412)
Goodwill and other intangible assets           | (2,706)  | (2,277)
Total                                          | (3,067)  | (2,689)
Total deferred tax liabilities                 | $(418)   | $(104) |