Equity Compensation Plan Information
The following table summarizes share and exercise price information for our equity compensation plans as of December 31, 2019.
(1) Includes 105,000 shares of our common stock issuable upon exercise of outstanding stock options and 340,000 shares issuable upon vesting of outstanding restricted stock units.
(2) Represents an individual option grant to our Chairman and Chief Executive Officer outside of, and prior to the establishment of, the 2013 Stock Incentive Plan in October 2013 referred to in the above table. The option agreement pertaining to such option grant contain customary anti-dilution provisions.
(3) Does not take into account outstanding restricted stock units as these awards have no exercise price.
Our 2013 Stock Incentive Plan (“2013 Plan”) provides for the grant of any or all of the following types of awards: (a) stock options, (b) restricted stock, (c) deferred stock, (d) stock appreciation rights, and (e) other stock-based awards including restricted stock units. Awards under the 2013 Plan may be granted singly, in combination, or in tandem. Subject to standard anti-dilution adjustments as provided in the 2013 Plan, the 2013 Plan provides for an aggregate of 2,600,000 shares of our common stock to be available for distribution pursuant to the 2013 Plan. The Compensation Committee (or the Board of Directors) will generally have the authority to administer the 2013 Plan, determine participants who will be granted awards under the 2013 Plan, the size and types of awards, the terms and conditions of awards and the form and content of the award agreements representing awards. Awards under the 2013 Plan may be granted to our employees, directors and consultants. As of December 31, 2019, there were options to purchase an aggregate of 605,000 shares of common stock outstanding and 340,000 shares issuable upon vesting of outstanding restricted stock units granted under the 2013 Plan, and a balance of 1,780,505 shares of common stock are reserved for issuance under the 2013 Plan.

                                                           | Number of securities to be issued upon exercise of outstanding options and rights | Weighted-average exercise price of outstanding options and rights | Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column(a))
---------------------------------------------------------- | --------------------------------------------------------------------------------- | ----------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------
                                                           | (a)                                                                               | (b)                                                               | (c)
Equity compensation plans approved by security holders     | 445,000(1)                                                                        | $2.34(3)                                                          | 1,780,505
Equity compensation plans not approved by security holders | 500,000(2)                                                                        | $1.19                                                             | —
Total                                                      | 945,000                                                                           | $1.39(3)                                                          | 1,780,505

Equity Compensation Plan Information
 table summarizes share exercise price information equity compensation plans December 31, 2019.
 Includes 105,000 shares common stock stock options 340,000 shares vesting restricted stock units.
 Represents individual option grant Chairman Chief Executive Officer outside 2013 Stock Incentive Plan 2013. option agreement anti-dilution provisions.
 restricted stock units no exercise price.
 2013 Stock Incentive Plan provides awards stock options restricted stock deferred stock stock appreciation rights other stock-based awards. singly combination tandem. provides 2,600,000 shares common stock distribution. Compensation Committee Board 2013 Plan awards size types terms conditions form agreements. Awards employees directors consultants. December 31, 2019 options purchase 605,000 shares common stock 340,000 shares issuable vesting restricted stock units 1,780,505 shares reserved issuance 2013 Plan.
securities issued options Weighted-average exercise price securities future plans column(a
 (a)
 Equity compensation plans approved 445,000(1) $2. 34(3) 1,780,505
 not 500,000(2) $1. 19
 Total 945,000 $1. 39(3) 1,780,505


Cash used in investing activities
Detail of the cash used in investing activities is included below for each year (dollars in millions).
2019 vs. 2018. The $8.8 million higher spend on investing activities during 2019 compared to 2018 was primarily related to an increase in capitalized costs associated with various internally-developed software projects, such as mobile application development and transaction processing, an increase in hardware costs primarily associated with our growing infrastructure needs and an increase in leasehold improvements associated with security build outs of expanded office space.
2018 vs. 2017. We had net cash used in investing activities of $6.6 million during 2018 compared to $4.1 million during 2017. The higher spend in 2018 was primarily related to an increase in software expenditures, most of which were capitalized costs related to internally-developed software, which consisted primarily of merchant experience enhancements and mobile application development. This activity was partially offset by lower infrastructure expenditures in 2018 compared to 2017, as we did not have any material changes to our leased premises during 2018.

                                              |       | Year Ended December 31, |
--------------------------------------------- | ----- | ----------------------- | ----
                                              | 2019  | 2018                    | 2017
Software                                      | $12.7 | $5.4                    | $2.3
Computer hardware                             | 1.2   | 0.8                     | 0.8
Leasehold improvements                        | 0.9   | 0.2                     | 0.5
Furniture                                     | 0.6   | 0.2                     | 0.5
Purchases of property, equipment and software | $15.4 | $6.6                    | $4.1

Cash investing activities
 each year millions.
 2019 vs. 2018. $8. million higher spend 2019 related capitalized costs internally-developed software projects mobile application hardware costs infrastructure leasehold improvements security expanded office space.
 2018. 2017. net cash $6. million 2018 $4. 1 million 2017. higher spend 2018 software expenditures capitalized internally-developed merchant experience enhancements mobile application development. offset by lower infrastructure expenditures material changes leased premises 2018.
 Year Ended December 31,
 2019
 Software $12. $5. $2.
 Computer hardware.
 Leasehold improvements.
 Furniture.
 Purchases property equipment software $15. $6. $4.


NET DEBT
The term net debt does not have any standardized meaning under IFRS. Therefore, it is unlikely to be comparable to similar measures presented by other issuers.
We define net debt as debt due within one year plus long-term debt and 50% of preferred shares, less cash and cash equivalents, as shown in BCE’s consolidated statements of financial position. We include 50% of outstanding preferred shares in our net debt as it is consistent with the treatment by certain credit rating agencies.
We consider net debt to be an important indicator of the company’s financial leverage because it represents the amount of debt that is not covered by available cash and cash equivalents. We believe that certain investors and analysts use net debt to determine a company’s financial leverage.
Net debt has no directly comparable IFRS financial measure, but rather is calculated using several asset and liability categories from the statements of financial position, as shown in the following table.

                                    | 2019   | 2018
----------------------------------- | ------ | ------
Debt due within one year            | 3,881  | 4,645
Long-term debt                      | 22,415 | 19,760
50% of outstanding preferred shares | 2,002  | 2,002
Cash and cash equivalents           | (145)  | (425)
Net debt                            | 28,153 | 25,982

 standardized meaning IFRS. unlikely comparable issuers.
 debt due one year long-term debt 50% preferred shares less cash equivalents BCE’s statements financial. 50% preferred shares debt consistent credit rating agencies.
 debt important indicator financial leverage debt not covered cash equivalents. investors analysts use financial leverage.
 comparable IFRS calculated asset liability categories.
 Debt due one year 3,881 4,645
 Long-term debt 22,415 19,760
 50% preferred shares 2,002
 Cash equivalents (145)
 Net debt 28,153 25,982


6. Called up share capital
Accounting policies
Equity instruments issued by the Company are recorded at the amount of the proceeds received, net of direct issuance costs.
Notes: 1 At 31 March 2019 there were 50,000 (2018: 50,000) 7% cumulative fixed rate shares of £1 each in issue
2 At 31 March 2019 the Group held 1,584,882,610 (2018: 2,139,038,029) treasury shares with a nominal value of €264 million (2018: €356 million). The market value of shares held was €2,566 million (2018: €4,738 million). During the year, 45,657,750 (2018: 53,026,317) treasury shares were reissued under Group share schemes. On 25 August 2017, 729,077,001 treasury shares were issued in settlement of tranche 1 of a maturing subordinated mandatory convertible bond issued on 19 February 2016. On 25 February 2019, 799,067,749 treasury shares were issued in settlement of tranche 2 of the maturing subordinated mandatory convertible bond. On 5 March 2019 the Group announced the placing of subordinated mandatory convertible bonds totalling £1.72 billion with a 2 year maturity date in 2021 and £1.72 billion with a 3 year maturity date due in 2022. The bonds are convertible into a total of 2,547,204,739 ordinary shares with a conversion price of £1.3505 per share. For further details see note 20 “Borrowings and capital resources” in the consolidated financial statements.
3 Represents US share awards and option scheme awards.

                                                                              |                | 2019  |                | 2018
----------------------------------------------------------------------------- | -------------- | ----- | -------------- | -----
                                                                              | Number         | €m    | Number         | €m
Ordinary shares of 2020⁄21 US cents each allotted, issued and fully paid:1, 2 |                |       |                |
1 April                                                                       | 28,814,803,308 | 4,796 | 28,814,142,848 | 4,796
Allotted during the year3                                                     | 454,870        | –     | 660,460        | –
31 March                                                                      | 28,815,258,178 | 4,796 | 28,814,803,308 | 4,796

. share capital
 Equity instruments proceeds issuance costs.
 31 March 2019 50,000 7% fixed rate shares £1
 31 March 2019 Group held 1,584,882,610 (2018 2,139,038,029) treasury shares €264 million €356 million. market value €2,566 million €4,738 million. 45,657,750 (2018 53,026,317) shares reissued schemes. 25 August 2017 729,077,001 shares issued bond 2016. 25 February 2019,067,749. 5 March 2019 convertible bonds £1. 72 billion 2 year maturity 2021 £1. 72 billion 3 year maturity 2022. bonds convertible 2,547,204,739 ordinary shares price £1. 3505 per share. note 20 capital financial statements.
 share awards option scheme awards.
 shares allotted issued
 28,814,803
Allotted 454,870 660,460
 31 March 28,815,258,178,308


The $252.5 million of valuation allowance as of September 27, 2019 relates primarily to federal and state NOLs, tax credit carryforwards and a partial valuation allowance on tax credits in Canada of $19.0 million whose recovery is not considered more likely than not. The$243.1 million of valuation allowance as of September 28, 2018 related primarily to federal and state NOLs, tax credit carryforwards and a partial valuation allowance on tax credits in Canada of$13.6 million whose recovery is not considered more likely than not. The change during the fiscal year endedSeptember 27, 2019 of $9.4 million primarily relates to the reduction of our NOLs due to section 382 limitations, the changes in our temporary differences, and the lower U.S federal tax rate.
Our effective tax rates differ from the federal and statutory rate as follows:
For fiscal years 2019, 2018 and 2017, the effective tax rates on $423.2 million, $155.2 million and $49.5 million, respectively, of pre-tax loss from continuing operations were 9.3%, 13.8% and (203.8)%, respectively.
For fiscal year 2019, the effective tax rate was primarily impacted by a change in our NOL carryforward due to an adjustment in our Section 382 limitation from a prior period acquisition and the immediate recognition of the current and deferred income tax effects totaling $39.8 million from an intra-entity transfer of a license for intellectual property to a higher taxed jurisdiction that received a tax basis step-up.
For fiscal year 2018, the effective tax rate was primarily impacted by the Tax Cuts and Jobs Act (the "Tax Act"). The effective income tax rates for fiscal years 2019, 2018 and 2017 were also impacted by a lower income tax rate in many foreign jurisdictions in which our foreign subsidiaries operate, changes in valuation allowance, research and development tax credits, and a fair market value adjustment of warrant liabilities.
All earnings of foreign subsidiaries, other than our M/A-COM Technology Solutions International Limited Cayman Islands subsidiary ("Cayman Islands subsidiary"), are considered indefinitely reinvested for the periods presented. During fiscal year 2019 we changed our position for our Cayman Islands subsidiary to no longer have its earnings permanently reinvested.
Although a foreign subsidiary would typically have to accrue for foreign withholding tax liabilities associated with undistributed earnings, Cayman Islands has no withholding tax under domestic law, therefore, we did not accrue for foreign withholding tax.
During fiscal year 2019 we finalized our calculation of the one-time deemed repatriation of gross foreign earnings and profits, totaling $156.8 million, which resulted in approximately $86.7 million in U.S. taxable income for the year ended September 28, 2018 with Grand Cayman and Ireland accounting for$ 59.7 million and $25.6 million, respectively. Due to the fact that we are in a full U.S. valuation allowance, this one-time deemed repatriation had no impact on our tax expense for fiscal year 2018.
Our fiscal year 2019 tax provision incorporated changes required by the Tax Act. Some of these changes include a new limitation on the deductible interest expense, inclusion of Global Intangible Low Taxed Income earned by controlled foreign corporations, computation of the new base erosion anti-abuse minimum tax, repealing the performance-based compensation exception to section 162(m) and revising the definition of a covered employee.

                                   |        | Fiscal Years |
---------------------------------- | ------ | ------------ | --------
                                   | 2019   | 2018         | 2017
Federal statutory rate             | 21.0%  | 24.5%        | 35.0%
Foreign rate differential          | 1.6    | 5.1          | 31.9
State taxes net of federal benefit | 0.9    | 0.8          | 0.2
Warrant liabilities                | —      | 4.4          | (1.8)
Change in valuation allowance      | (2.4)  | 34.0         | (270.0)
Research and development credits   | 1.4    | 9.0          | 12.8
Provision to return adjustments    | 0.3    | 8.3          | (4.0)
Section 382 adjustment             | (19.3) | —            | —
Nondeductible compensation expense | (0.6)  | 1.4          | (4.1)
Global Intangible Low Taxed Income | (2.9)  | —            | —
Nondeductible legal fees           | —      | 0.9          | (3.9)
2017 tax reform                    | —      | (73.7)       | —
Intra-entity license transfer      | 9.4    | —            | —
Other permanent differences        | (0.1)  | (0.9)        | 0.1
Effective income tax rate          | 9.3%   | 13.8%        | (203.8)%

$252. 5 million valuation allowance September 27, 2019 federal state NOLs tax credit carryforwards partial Canada $19. million recovery.$243. 1 million September 28, 2018 NOLs carryforwards Canada$13. 6 million recovery. change 2019 $9. 4 million reduction NOLs section 382 limitations temporary differences lower U. S federal tax rate.
 effective tax rates differ
 2019 2018 2017 tax rates $423. 2 million $155. 2 million $49. 5 million 9. 3% 13. 8% (203. 8)%,.
 2019 impacted NOL carryforward Section 382 current deferred income tax effects $39. 8 million transfer license higher taxed jurisdiction.
 2018 impacted Tax Cuts Jobs Act. impacted lower income tax rate foreign jurisdictions changes valuation allowance research development tax credits fair market value adjustment warrant liabilities.
 earnings foreign subsidiaries-COM Technology Solutions Islands indefinitely reinvested.fiscal year 2019 changed position Cayman Islands subsidiary earnings reinvested.
 foreign subsidiary Cayman Islands no tax.
 2019 finalized calculation one repatriation foreign earnings profits $156. 8 million $86. 7 million U. S. taxable income year September 28, 2018 Grand Cayman Ireland accounting$ 59. 7 million $25. 6 million. full U. S. valuation allowance repatriation impact tax expense 2018.
 2019 tax provision incorporated changes Tax Act. limitation deductible interest expense Global Intangible Low Taxed Income new base erosion anti-abuse minimum tax performance-based compensation exception revising definition covered employee.
 Fiscal Years
 Federal statutory rate.
 Foreign rate differential.
 State taxes federal benefit.
 Warrant liabilities.
 Change valuation allowance.
 Research development credits.
 Provision return adjustments.
 Section 382 adjustment.
 Nondeductible compensation. 6). 4.
 Low Taxed Income. 9)
 Nondeductible legal fees.
 2017 tax reform. 7)
 Intra-entity license transfer. 4
 differences. 9).
 income tax rate. 3%. 8%.


Cash Flows
The following table summarizes our cash flows for the periods indicated:
Operating Activities
Our primary source of cash from operating activities has been cash collections from our customers. We expect cash inflows from operating activities to be primarily affected by increases in total bookings. Our primary uses of cash from operating activities have been for domain registration costs paid to registries, software licensing fees related to third-party email and productivity solutions, personnel costs, discretionary marketing and advertising costs, technology and development costs and interest payments. We expect cash outflows from operating activities to be affected by the timing of payments we make to registries and increases in personnel and other operating costs as we continue to grow our business and increase our international presence.
Net cash provided by operating activities increased $163.6 million from $559.8 million in 2018 to $723.4 million in 2019, primarily driven by our bookings growth as well as increased interest income.
Investing Activities
Our investing activities primarily consist of strategic acquisitions and purchases of property and equipment to support the overall growth of our business and our increased international presence. We expect our investing cash flows to be affected by the timing of payments we make for capital expenditures and the strategic acquisition or other growth opportunities we decide to pursue.
Net cash used in investing activities decreased $119.5 million from $254.8 million in 2018 to $135.3 million in 2019, primarily due to a $106.9 million decrease in business acquisitions.
Financing Activities
Our financing activities primarily consist of long-term debt borrowings, the repayment of principal on long-term debt, stock option exercises and share repurchases.
Net cash from financing activities decreased $503.9 million from $47.0 million provided in 2018 to $456.9 million used in 2019, primarily resulting from $458.6 million of share repurchases in 2019, a $44.4 million increase in acquisition contingent consideration payments and $13.2 million of financing-related costs paid in 2019.

                                                             | Year Ended December 31, |         |
------------------------------------------------------------ | ----------------------- | ------- | ---------
                                                             | 2019                    | 2018    | 2017
Net cash provided by operating activities                    | $723.4                  | $559.8  | $475.6
Net cash used in investing activities                        | (135.3)                 | (254.8) | (1,570.1)
Net cash provided by (used in) financing activities          | (456.9)                 | 47.0    | 1,107.5
Effect of exchange rate changes on cash and cash equivalents | (0.8)                   | (2.3)   | 3.6
Net increase in cash and cash equivalents                    | $130.4                  | $349.7  | $16.6

Cash Flows
 table summarizes cash flows
 Operating Activities
 primary source collections. inflows affected by bookings. uses domain registration software licensing personnel marketing advertising technology development interest payments. outflows by timing payments personnel costs.
 Net cash increased $163. 6 million from $559. 8 million 2018 to $723. 4 million 2019 driven bookings growth interest income.
 Investing Activities
 purchases. cash flows timing capital expenditures.
 Net cash decreased $119. 5 million from $254. 8 million 2018 to $135. 3 million 2019 $106. 9 million decrease acquisitions.
 Financing Activities
-term debt borrowings repayment stock option exercises share repurchases.
 Net cash decreased $503. 9 million from $47. million 2018 to $456. 9 million 2019 $458. 6 million share repurchases $44. 4 million acquisition contingent payments $13. 2 million financing costs.
 December
2019 2017
 operating $723. $559. $475.
 investing (135. (254. (1,570.
 financing (456. 47. 1,107.
 exchange rate changes cash equivalents (0. (2. 3.
 increase $130. $349. $16.


The following table provides a reconciliation from U.S. GAAP Net income to non-GAAP Adjusted net income (amounts in thousands):
(1) Fiscal years ending March 31, 2018 and 2017 adjusted due to the adoption of ASC 606.
(2) $0.9 million in costs incurred during fiscal year 2018 related to the relocation of the Company's tantalum powder facility equipment from Carson City, Nevada to its existing Matamoros, Mexico plant were reclassified from “Plant start-up costs” to “Restructuring charges” during fiscal year 2019.

                                                            |          | Fiscal Years Ended March 31, |
----------------------------------------------------------- | -------- | ---------------------------- | --------
                                                            | 2019     | 2018                         | 2017
Net income (GAAP) (1)                                       | $206,587 | $254,127                     | $47,157
Non-GAAP adjustments:                                       |          |                              |
Equity (income) loss from equity method investments         | 3,304    | (76,192)                     | (41,643)
Acquisition (gain) loss                                     | —        | (130,880)                    | —
Change in value of TOKIN options                            | —        | —                            | (10,700)
(Gain) loss on write down and disposal of long-lived assets | 1,660    | (992)                        | 10,671
Restructuring charges (2)                                   | 8,779    | 14,843                       | 5,404
R&D grant reimbursements and grant income                   | (4,559)  | —                            | —
ERP integration costs/IT transition costs                   | 8,813    | 80                           | 7,045
Stock-based compensation                                    | 12,866   | 7,657                        | 4,720
Legal expenses/fines related to antitrust class actions     | 11,896   | 16,636                       | 2,640
Net foreign exchange (gain) loss                            | (7,230)  | 13,145                       | (3,758)
TOKIN investment-related expenses                           | —        | —                            | 1,101
Plant start-up costs (2)                                    | (927)    | 929                          | 427
Amortization included in interest expense                   | 1,872    | 2,467                        | 761
Income tax effect of non-GAAP adjustments                   | (50,012) | (30)                         | (741)
Loss on early extinguishment of debt                        | 15,946   | 486                          | —
Adjusted net income (non-GAAP) (1)                          | $208,995 | $102,276                     | $23,084

table. GAAP non-GAAP income
 Fiscal years 2018 2017 adjusted ASC 606.
. 9 million costs relocation tantalum powder equipment Carson City Nevada Matamoros Mexico reclassified start-up 2019.
 Years Ended March
 2017
 Net income (GAAP $206,587 $254,127 $47,157
 Non-GAAP adjustments
 Equity loss investments 3,304 (76,192) (41,643)
 Acquisition) loss,880
 Change value TOKIN options,700
 loss write down disposal long-lived assets 1,660
 Restructuring charges 8,779 14,843 5
 R&D grant reimbursements income
 ERP integration transition costs
 Stock-based compensation,866
 Legal expenses antitrust class actions 11,896
 foreign exchange loss (7,230
 TOKIN investment-related expenses
 Plant start-up costs
1,872 2,467
 Income tax non-GAAP (50,012)
 Loss extinguishment debt 15,946 486
 Adjusted income $208,995 $102,276


Note 8 Property and Equipment, net
The following table details our property and equipment, net.
(1) Upon adoption of ASU 2016-02, $28.3 million of assets that were included in property and equipment, net as of December 31, 2018 are now included in other non-current assets on our Consolidated Balance Sheets as of December 31, 2019. These assets were related to capital leases, primarily for warehouse, office and small manufacturing facilities, IT equipment and automobiles, which are now ROU assets. Refer to Note 4, “Leases,” of the Notes to Consolidated Financial Statements for additional information on our ROU assets.

December 31,                              |           |
----------------------------------------- | --------- | ---------
(In millions)                             | 2019      | 2018(1)
Land and improvements                     | $ 50.7    | $ 41.2
Buildings                                 | 747.0     | 728.6
Machinery and equipment                   | 2,453.2   | 2,325.7
Other property and equipment              | 141.3     | 135.6
Construction-in-progress                  | 127.9     | 155.1
Property and equipment, gross             | 3,520.1   | 3,386.2
Accumulated depreciation and amortization | (2,378.2) | (2,350.0)
Property and equipment, net               | $ 1,141.9 | $ 1,036.2

Property Equipment
 table details.
 ASU 2016-02. 3 million assets 2018 non Consolidated Balance Sheets 2019. capital leases warehouse office manufacturing facilities IT equipment automobiles ROU. Note 4 Financial Statements information ROU assets.
 Land improvements $ 50. $ 41.
 Buildings 747. 728.
 Machinery equipment 2,453. 2,325.
 property 141. 135.
 Construction-in-progress 127. 155.
 Property equipment 3,520. 3,386.
 Accumulated depreciation amortization (2,378.,350.
 $ 1,141. $ 1,036.


Note A: Beginning from June 2015, the Company accounts for its investment in FARADAY as an associate given the fact that the Company obtained the ability to exercise significant influence over FARADAY through representation on its Board of Directors.
Note B: WINAICO SOLAR PROJEKT 1 GMBH and WINAICO IMMOBILIEN GMBH are joint ventures to the Company.
Note C: The Company follows international accounting practices in equity accounting for limited partnerships and uses the equity method to account for these investees.
The carrying amount of investments accounted for using the equity method for which there are published price quotations amounted to NT$1,733 million and NT$1,750 million, as of December 31, 2018 and 2019, respectively. The fair value of these investments were NT$1,621 million and NT$2,244 million, as of December 31, 2018 and 2019, respectively.

As of December 31,                          |                    |                                          |                    |
------------------------------------------- | ------------------ | ---------------------------------------- | ------------------ | ----------------------------------------
                                            | 2018               |                                          | 2019               |
Investee companies                          | Amount             | Percentage of ownership or voting rights | Amount             | Percentage of ownership or voting rights
                                            | NT$ (In Thousands) |                                          | NT$ (In Thousands) |
Listed companies                            |                    |                                          |                    |
CLIENTRON CORP.                             | $249,663           | 22.39                                    | $276,515           | 21.90
FARADAY TECHNOLOGY CORP. (FARADAY) (Note A) | 1,483,111          | 13.78                                    | 1,473,028          | 13.78
Unlisted companies                          |                    |                                          |                    |
MTIC HOLDINGS PTE. LTD.                     | 3,026              | 45.44                                    | 18,157             | 45.44
WINAICO IMMOBILIEN GMBH (Note B)            | —                  | 44.78                                    | —                  | 44.78
PURIUMFIL INC.                              | —                  | —                                        | 7,164              | 44.45
UNITECH CAPITAL INC.                        | 568,005            | 42.00                                    | 642,660            | 42.00
TRIKNIGHT CAPITAL CORPORATION               | 1,520,575          | 40.00                                    | 2,281,631          | 40.00
HSUN CHIEH INVESTMENT CO., LTD.             | 1,608,551          | 36.49                                    | 1,686,502          | 36.49
YANN YUAN INVESTMENT CO., LTD.              | 2,032,013          | 30.87                                    | 2,761,821          | 30.87
HSUN CHIEH CAPITAL CORP.                    | 161,319            | 30.00                                    | 122,060            | 30.00
VSENSE CO., LTD.                            | 31,544             | 26.89                                    | 592                | 25.90
UNITED LED CORPORATION HONG KONG LIMITED    | 167,953            | 25.14                                    | 121,973            | 25.14
TRANSLINK CAPITAL PARTNERS I, L.P. (Note C) | 120,440            | 10.38                                    | 172,414            | 10.38
WINAICO SOLAR PROJEKT 1 GMBH (Note B)       | —                  | 50.00                                    | —                  | —
YUNG LI INVESTMENTS, INC.                   | 2,213              | 45.16                                    | —                  | —
Total                                       | $7,948,413         |                                          | $9,564,517         |

June 2015, Company accounts investment FARADAY associate influence FARADAY Board Directors.
 WINAICO SOLAR PROJEKT 1 WINAICO IMMOBILIEN GMBH joint ventures.
 follows international practices equity uses equity method.
 investments equity method NT$1,733 million NT$1,750 million December 31, 2018 2019. fair value NT$1,621 million NT$2,244 million December 31, 2018 2019.
 companies Percentage ownership voting rights
 Thousands
 Listed companies
 CLIENTRON CORP. $249,663 . $276,515.
 FARADAY TECHNOLOGY CORP. 1,483,111. 1,473,028.
 Unlisted companies
 MTIC HOLDINGS PTE. LTD. 3,026. 18,157.
 WINAICO IMMOBILIEN GMBH.
 PURIUMFIL INC. 7,164.
 UNITECH CAPITAL INC. 568,005.642,660.
 TRIKNIGHT CAPITAL 1,520,575. 2,281,631.
 HSUN CHIEH INVESTMENT. 1,608,551. 1,686,502.
 YANN YUAN INVESTMENT. 2,032,013. 2,761,821.
 CHIEH CAPITAL. 161,319. 122,060.
.
 UNITED LED CORPORATION HONG 167,953. 121,973.
 TRANSLINK CAPITAL PARTNERS. 120,440. 172,414.
 WINAICO SOLAR PROJEKT.
 YUNG LI INVESTMENTS.
 $7,948,413 $9,564,517


Item 6. SELECTED FINANCIAL DATA
You should read the following selected consolidated financial data for the five-year period ended March 31, 2019 in conjunction with our consolidated financial statements and notes thereto and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in Items 7 and 8 of this Form 10-K. Our consolidated statements of income data for each of the years in the three-year period ended March 31, 2019, and the balance sheet data as of March 31, 2019 and 2018, are derived from our audited consolidated financial statements, included in Item 8 of this Form 10-K. The statement of income data for the years ended March 31, 2016 and 2015 and balance sheet data as of March 31, 2017, 2016 and 2015 have been derived from our audited consolidated financial statements not included herein (in the tables below all amounts are in millions, except per share data).
(1) Refer to Note 2 to our consolidated financial statements for an explanation of our material business combinations during fiscal 2019 and fiscal 2017.
(2) Refer to Note 4 to our consolidated financial statements for a discussion of the special charges and other, net.
(3) Refer to Note 12 Debt and Credit Facility for further discussion.

                                                                              |           |           | Year ended March 31, |           |
----------------------------------------------------------------------------- | --------- | --------- | -------------------- | --------- | ---------
                                                                              | 2019 (1)  | 2018      | 2017 (1)             | 2016      | 2015
Consolidated Statements of Income data:                                       |           |           |                      |           |
Net sales                                                                     | $5,349.5  | $3,980.8  | $3,407.8             | $2,173.3  | $2,147.0
Special charges and other, net (2)                                            | $33.7     | $17.5     | $98.6                | $4.0      | $2.8
Loss on settlement of debt (3)                                                | $(12.6)   | $(16.0)   | $(43.9)              | $—        | $(50.6)
Net income from continuing operations                                         | $355.9    | $255.4    | $170.6               | $323.9    | $365.3
Basic net income per common share from continuing operations                  | $1.51     | $1.10     | $0.79                | $1.59     | $1.84
Diluted net income per common share from continuing operations                | $1.42     | $1.03     | $0.73                | $1.49     | $1.65
Dividends declared per common share                                           | $1.457    | $1.449    | $1.441               | $1.433    | $1.425
Consolidated Balance Sheets data:                                             |           |           |                      |           |
Total assets                                                                  | $18,350.0 | $8,257.2  | $7,686.9             | $5,537.9  | $4,780.7
Net long-term debt and capital lease obligations, less current maturities (3) | $8,956.0  | $1,769.1  | $2,912.1             | $2,465.8  | $1,840.0
Microchip Technology stockholders' equity                                     | $ 5,287.5 | $ 3,279.8 | $3,270.7             | $ 2,150.9 | $ 2,044.7

6. SELECTED FINANCIAL DATA
 read consolidated financial data five-year period March 31, 2019 financial statements notes "Management's Discussion Analysis Financial Condition Results Operations Items 7 8 Form 10-K. consolidated income March 31, 2019 balance sheet data March 31, 2018 derived audited financial statements Item 8 Form 10-K. income years March 31, 2016 2015 balance sheet data derived statements amounts millions share.
 Refer Note 2 business combinations fiscal 2019 2017.
 Note 4 special charges.
 Note 12 Debt Credit Facility discussion.
 Year ended March 31,
 2019 2018 2017 2015
 Consolidated Statements Income
 Net sales $5,349. $3,980. $3,407. $2,173. $2,147.
 Special charges $33. $17. $98. $4. $2.
 Loss settlement debt.(43.
 Net income operations $355. $255. $170. $323. $365.
income share. 51. 79. 59.
 income. 42. 73. 49.
 Dividends share. 457. 449. 433. 425
 Balance Sheets
 assets $18,350. $8,257. $7,686. $5,537. $4,780.
 long-term debt capital lease obligations maturities $8,956. $1,769. $2,912. $2,465. $1,840.
 Microchip stockholders equity 5,287. 3,279. $3,270. 2,150. 2,044.


Results of Continuing Operations
The following table sets forth certain operational data as a percentage of net sales for the fiscal years indicated:

                                           |        | Year Ended March 31, |
------------------------------------------ | ------ | -------------------- | ------
                                           | 2019   | 2018                 | 2017
Net sales                                  | 100.0% | 100.0%               | 100.0%
Cost of sales                              | 45.2   | 39.2                 | 48.4
Gross profit                               | 54.8   | 60.8                 | 51.6
Research and development                   | 15.4   | 13.3                 | 16.0
Selling, general and administrative        | 12.8   | 11.4                 | 14.7
Amortization of acquired intangible assets | 12.6   | 12.2                 | 9.9
Special charges and other, net             | 0.6    | 0.4                  | 2.9
Operating income                           | 13.4%  | 23.5%                | 8.1%

Operations
 table operational data net sales fiscal years
 Ended March 31,
 2019 2018 2017
 Net sales 100.
 Cost sales 45. 39. 48.
 profit 54. 60. 51.
 Research development 15. 13. 16.
 Selling 12. 11. 14.
 Amortization intangible assets 12. 9.
 charges.
 Operating income 13. 4% 23. 5% 8.


Net Sales
The following table presents our net sales and the percentage of total net sales by segment:

                         |          | Fiscal          |          |
------------------------ | -------- | --------------- | -------- | -----
                         | 2019     |                 | 2018     |
                         |          | ($ in millions) |          |
Transportation Solutions | $  7,821 | 58 %            | $ 8,290  | 59 %
Industrial Solutions     | 3,954    | 30              | 3,856    | 28
Communications Solutions | 1,673    | 12              | 1,842    | 13
Total                    | $ 13,448 | 100 %           | $ 13,988 | 100 %

Net Sales
 table presents percentage segment
 2019 2018
$ millions
 Transportation Solutions $ 7,821 58 % 8,290 59 %
 Industrial Solutions 3,954
 Communications Solutions 1,673 1,842
 $ 13,448 100 % 13,988


AMERICAN TOWER CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Tabular amounts in millions, unless otherwise disclosed)
2018 Transactions
During the year ended December 31, 2019, the allocation of the final purchase price for the acquisition of Idea Cellular Infrastructure Services Limited was finalized with no material post-closing adjustments. During the year ended December 31, 2019, there were no material post-closing adjustments that impacted other 2018 acquisitions.
Pro Forma Consolidated Results (Unaudited)
The following table presents the unaudited pro forma financial results as if the 2019 acquisitions had occurred on January 1, 2018 and the 2018 acquisitions had occurred on January 1, 2017. The pro forma results do not include any anticipated cost synergies, costs or other integration impacts. Accordingly, such pro forma amounts are not necessarily indicative of the results that actually would have occurred had the transactions been completed on the dates indicated, nor are they indicative of the future operating results of the Company.

                                                                                | Year Ended December 31, |
----------------------------------------------------------------------------------- | ----------------------- | --------
                                                                                | 2019                    | 2018
Pro forma revenues                                                                  | $7,904.2                | $7,936.0
Pro forma net income attributable to American Tower Corporation common stockholders | $1,844.9                | $1,122.6
Pro forma net income per common share amounts:                                      |                         |
Basic net income attributable to American Tower Corporation common stockholders     | $4.17                   | $2.55
Diluted net income attributable to American Tower Corporation common stockholders   | $4.14                   | $2.53

AMERICAN TOWER CORPORATION SUBSIDIARIES FINANCIAL STATEMENTS amounts millions
 2018 Transactions
 December 31, 2019 final purchase price Idea Cellular Infrastructure Services no-closing adjustments. no adjustments 2018 acquisitions.
 Pro Forma Consolidated Results
 unaudited financial results 2019 acquisitions January 1, 2018 2018 January 1, 2017. results include anticipated cost synergies integration impacts. not indicative results future results.
 Year Ended December 31,
 2018
 Pro forma revenues $7,904. $7,936.
 net income American Tower Corporation stockholders $1,844. $1,122.
 income common share
 income $4. 17 $2.
 income $4. 14 $2.


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 impact of consolidation of GS Holdings into the Consolidated Statements of Operations for the years indicated.

                                  | Year Ended December 31, |
--------------------------------- | ----------------------- | --------
                                  | 2019                    | 2018
Total revenue                     | $529,646                | $414,673
Total costs and expenses          | 408,693                 | 261,883
Operating profit                  | 120,953                 | 152,790
Total other income (expense), net | (22,297)                | (19,276)
Net income                        | $98,656                 | $133,514

GreenSky. CONSOLIDATED FINANCIAL STATEMENTS States Dollars
 consolidation GS Holdings Statements Operations.
 Ended December 31,
 revenue $529,646 $414,673
 costs expenses,693 261,883
 profit 120,953 152,790
 income (22,297 (19,276)
 income $98,656 $133,514


ADVANCED ENERGY INDUSTRIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (continued) (in thousands, except per share amounts)
The following table summarizes the estimated preliminary fair values of the assets acquired and liabilities assumed from the acquisition in 2019:

                                        | Preliminary: September 10, 2019 | Measurement Period Adjustments | Preliminary: December 31, 2019
--------------------------------------- | ------------------------------- | ------------------------------ | ------------------------------
Accounts and other receivable, net      | $  128,221                      | $  -                           | $  128,221
Inventories                             | 140,678                         | (900)                          | 139,778
Property and equipment                  | 65,016                          | (1,984)                        | 63,032
Operating lease right-of-use assets     | 60,217                          | (144)                          | 60,073
Goodwill                                | 143,262                         | (30,222)                       | 113,040
Intangible assets                       | 125,000                         | (1,000)                        | 124,000
Deferred income tax assets              | 14,767                          | (14,767)                       | —
Other assets                            | 61,511                          | 2,507                          | 64,018
Total assets acquired                   | 738,672                         | (46,510)                       | 692,162
Accounts payable                        | 144,652                         | 50                             | 144,702
Operating lease liability               | 59,634                          | 477                            | 60,111
Pension liability                       | 48,494                          | 192                            | 48,686
Deferred income tax liabilities         | 37,218                          | (31,372)                       | 5,846
Other liabilities                       | 80,876                          | (9,312)                        | 71,564
Total liabilities assumed               | 370,874                         | (39,965)                       | 330,909
Total fair value of net assets acquired | $367,798                        | $  (6,545)                     | $361,253

ADVANCED ENERGY INDUSTRIES. FINANCIAL STATEMENTS share
 table summarizes values assets liabilities assumed 2019
 September 10 December 31, 2019
 Accounts receivable $ 128,221
 Inventories 140,678 139,778
 Property equipment 65,016
 lease right-of-use assets 60,217
 Goodwill 143,262 113,040
 Intangible assets 125,000
 Deferred income tax assets 14,767
 Other assets 61,511
 assets acquired 738,672 692,162
 Accounts payable 144,652
 Operating lease 59,634
 Pension 48,494
 Deferred income tax liabilities 37,218
 Other liabilities 80,876 71,564
 liabilities assumed 370,874 330,909
 assets acquired $367,798,253


Non-Operating Income, net: Non-operating income, net consists primarily of interest income, net foreign currency exchange losses, the noncontrolling interests in the net profits of our majority-owned subsidiaries (primarily Oracle Financial Services Software Limited and Oracle Corporation Japan) and net other income, including net recognized gains and losses related to all of our investments, net unrealized gains and losses related to the small portion of our investment portfolio related to our deferred compensation plan, net unrealized gains and losses related to certain equity securities and non-service net periodic pension income (losses).
On a constant currency basis, our non-operating income, net decreased in fiscal 2019 compared to fiscal 2018 primarily due to decreases in other income, net in fiscal 2019 , which was primarily attributable to realized gains on the sale of certa in marketable securities during fiscal 2018 , and lower interest income in fiscal 2019 primarily due to lower average cash, cash equivalent and marketable securities balances during fiscal 2019 .

                                   |        |        | Year Ended May 31, |
---------------------------------- | ------ | ------ | ------------------ | ------
                                   |        |        | Percent Change     |
(Dollars in millions)              | 2019   | Actual | Constant           | 2018
Interest income                    | $1,092 | -9%    | -9%                | $1,203
Foreign currency losses, net       | (111)  | 50%    | 62%                | (74)
Noncontrolling interests in income | (152)  | 12%    | 12%                | (135)
Other income, net                  | (14)   | -107%  | -42%               | 191
Total non-operating income, net    | $815   | -31%   | -31%               | $1,185

Non-Operating Income interest foreign currency exchange losses noncontrolling interests profits subsidiaries Oracle Financial Services Software Oracle Corporation Japan other income recognized gains losses investments unrealized gains deferred compensation plan equity securities pension income.
 non-operating income decreased 2019 due decreases income gains sale securities lower interest income lower cash equivalent marketable securities balances.
 Year Ended May 31,
 Percent Change
 millions 2019
 Interest income $1,092 -9% $1,203
 Foreign currency losses (111) 50% 62% (74)
 Noncontrolling interests (152) 12%
 Other income net (14) -107% -42% 191
 Total non-operating income net $815 -31% $1,185


Unrecognized Tax Benefits
Current accounting guidance contains a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon ultimate settlement.
A reconciliation of the beginning and ending amounts of unrecognized tax benefits during fiscal 2019, 2018, and 2017 is as follows:
Included in the unrecognized tax benefits at fiscal 2019 and 2018 is $38.2 million and $36.7 million, respectively, that if recognized, would result in a reduction of our effective tax rate. The amounts differ from the long-term liability recorded of $20.1 million and $16.8 million as of fiscal 2019 and 2018, respectively, due to accrued interest and penalties, as well as unrecognized tax benefits of French and Italian entities that are recorded against deferred tax asset balances without valuation allowance.
We believe that events that could occur in the next 12 months and cause a change in unrecognized tax benefits include, but are not limited to, the following: • commencement, continuation or completion of examinations of our tax returns by the U.S. or foreign taxing authorities; and • expiration of statutes of limitation on our tax returns.
The calculation of unrecognized tax benefits involves dealing with uncertainties in the application of complex global tax regulations. Uncertainties include, but are not limited to, the impact of legislative, regulatory and judicial developments, transfer pricing and the application of withholding taxes. We regularly assess our tax positions in light of legislative, bilateral tax treaty, regulatory and judicial developments in the countries in which we do business. We determined that an estimate of the range of reasonably possible change in the amounts of unrecognized tax benefits within the next 12 months cannot be made.

                                                                                |                   | Fiscal Year       |
-------------------------------------------------------------------------------- | ----------------- | ----------------- | -----------------
(In thousands)                                                                   | December 29, 2019 | December 30, 2018 | December 31, 2017
Balance, beginning of year                                                       | $103,884          | $105,959          | $82,253
Additions for tax positions related to the current year                          | 2,517             | 2,404             | 2,478
Additions for tax positions from prior years                                     | 1,624             | 451               | 22,151
Reductions for tax positions from prior years/statute of limitations expirations | (416)             | (2,468)           | (1,460)
Foreign exchange (gain) loss                                                     | (668)             | (2,462)           | 537
Balance at the end of the period                                                 | $106,941          | $103,884          | $105,959

Unrecognized Tax Benefits
 accounting guidance two-step approach uncertain tax positions. first tax position for recognition sustained audit appeals. second step measure tax benefit largest amount 50% likely settlement.
 reconciliation unrecognized tax benefits fiscal 2019 2018 2017
 tax benefits fiscal 2019 2018 $38. 2 million $36. 7 million recognized reduction effective tax rate. amounts differ from long-term liability $20. 1 million $16. 8 million 2019 2018 due accrued interest penalties unrecognized tax benefits French Italian entities recorded against deferred tax balances.
 events next 12 months unrecognized tax benefits include examinations tax. foreign expiration statutes of limitation.
 calculation unrecognized tax benefits involves uncertainties global tax regulations. legislative regulatory judicial developments transfer pricing withholding taxes. assess tax positions legislative developments. estimate change unrecognized tax benefits next 12 months.

 December 29, 2019 30, 2018 31, 2017
 $103,884 $105,959 $82,253
 Additions 2,517 2,404 2,478
 prior 1,624 22,151
 Reductions (416) (2,468
 Foreign exchange loss (668) (2,462 537
 end $106,941 $103,884 $105,959


Comparison of 2019 and 2018
Revenue
We generate substantially all of our revenue from sales of subscriptions, including domain registrations and renewals, hosting and presence products and business applications. Our subscription terms average one year, but can range from monthly terms to multi-annual terms of up to ten years depending on the product. We generally collect the full amount of subscription fees at the time of sale, while revenue is recognized over the period in which the performance obligations are satisfied, which is generally over the contract term. Revenue is presented net of refunds, and we maintain a reserve to provide for refunds granted to customers
Domains revenue primarily consists of revenue from the sale of domain registration subscriptions, domain add-ons and aftermarket domain sales. Domain registrations provide a customer with the exclusive use of a domain during the applicable contract term. After the contract term expires, unless renewed, the customer can no longer access the domain.
Hosting and presence revenue primarily consists of revenue from the sale of subscriptions for our website hosting products, website building products, website security products and online visibility products.
Business applications revenue primarily consists of revenue from the sale of subscriptions for third-party productivity applications, email accounts, email marketing tools and telephony solutions.
The following table presents our revenue for the periods indicated:
The 12.3% increase in total revenue was driven by growth in total customers and ARPU as well as having a full year of revenue from MSH in 2019, partially offset by the impact of movements in foreign currency exchange rates. The increase in customers impacted each of our revenue lines, as the additional customers purchased subscriptions across our product portfolio.
Domains. The 10.8% increase in domains revenue was primarily driven by the increase in domains under management from 77.6 million as of December 31, 2018 to 79.6 million as of December 31, 2019, increased aftermarket domain sales and international growth
Hosting and presence. The 10.7% increase in hosting and presence revenue was primarily driven by increased revenue from our website building and website security products as well as our acquisition of MSH.
Business applications. The 20.8% increase in business applications was primarily driven by increased customer adoption of our email, productivity and telephony solutions.

                      | Year Ended December 31, |           |           | 2019 to 2018 |          | 2018 to 2017 |
--------------------- | ----------------------- | --------- | --------- | ------------ | -------- | ------------ | --------
                      | 2019                    | 2018      | 2017      | $ change     | % change | $ change     | % change
Domains               | $ 1,351.6               | $ 1,220.3 | $ 1,057.2 | $ 131.3      | 11 %     | $ 163.1      | 15 %
Hosting and presence  | 1,126.5                 | 1,017.6   | 847.9     | 108.9        | 11 %     | 169.7        | 20 %
Business applications | 510.0                   | 422.2     | 326.8     | 87.8         | 21 %     | 95.4         | 29 %
Total revenue         | $ 2,988.1               | $ 2,660.1 | $ 2,231.9 | $ 328.0      | 12 %     | $ 428.2      | 19 %

2019 2018
 Revenue
 subscriptions domain registrations renewals hosting business applications. subscription terms average year range monthly ten years. collect subscription fees sale revenue recognized over performance obligations contract term. Revenue net refunds reserve refunds
 Domains revenue domain subscriptions add-ons aftermarket sales. registrations exclusive use contract term. After contract term expires access domain.
 Hosting presence revenue website hosting building security online visibility.
 Business applications revenue subscriptions third-party productivity applications email accounts marketing tools telephony solutions.
 table revenue
 12. 3% increase total revenue driven growth customers ARPU full year revenue MSH 2019 offset foreign currency rates. increase customers revenue customers purchased subscriptions.
. 10. 8% increase revenue driven increase domains. to 79. million 2019 increased aftermarket domain sales international growth
 Hosting presence. 10. 7% increase driven website building security acquisition MSH.
 Business applications. 20. 8% increase increased adoption email productivity telephony solutions.
Year Ended December 31, 2019 2018 2017
 Domains $ 1,351. 1,220. 1,057. 131. 163. 15 %
 Hosting 1,126. 1,017. 847. 108. 11 % 169. 20 %
 Business applications 510. 422. 326. 87. 21 % 95. 29 %
 revenue $ 2,988. $ 2,660. 2,231. $ 328. 12 % $ 428. 19 %


GreenSky, Inc. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) (United States Dollars in thousands, except per share data, unless otherwise stated)
Details of the Company’s deferred tax assets and liabilities are as follows:
As of December 31, 2019, the Company had net operating loss carryforwards (“NOLs”) of $4.7 million, of which approximately $3.9 million have an indefinite life. NOLs of $0.8 million will begin to expire in 2030. As of December 31, 2019, the Company had federal and state tax credit carryforwards of $0.2 million and $0.5 million, respectively, which will begin to expire in 2028 and 2038. The Company believes as of December 31, 2019, it is more likely than not that the results of future operations will generate sufficient taxable income to realize the NOLs and tax credits and, as such, no valuation allowance was recorded.

                                                 | Year Ended December 31, |
------------------------------------------------ | ----------------------- | --------
                                                 | 2019                    | 2018
Deferred tax assets:                             |                         |
Investment in partnership                        | $358,024                | $299,466
Net operating loss carryforwards and tax credits | 5,160                   | 5,634
Other                                            | 1,657                   | 1,879
Total                                            | 364,841                 | 306,979
Valuation allowance                              | —                       | —
Total deferred tax assets                        | 364,841                 | 306,979
Total deferred tax liabilities                   | —                       | —
Deferred tax assets, net                         | $364,841                | $306,979

GreenSky. FINANCIAL STATEMENTS States Dollars
 deferred tax assets liabilities
 December 31, 2019 net operating loss carryforwards $4. 7 million $3. 9 million indefinite life. $0. 8 million expire 2030. federal state tax credit carryforwards $0. 2 million $0. 5 million 2028 2038. future operations taxable income NOLs credits no valuation allowance.
 December 31,
 Deferred tax assets
 Investment $358,024 $299,466
 Net operating loss carryforwards tax credits 5
 364,841 306,979
 deferred tax assets 364,841 306,979
 deferred tax liabilities
 $364,841 $306,979


Contractual Obligations
The following table summarizes, as of December 31, 2019, our contractual obligations over the next five years for the property lease entered into during the year ended 2018, the VPN arrangement with Avira and the asset purchase from IBM:

                                |                  | Payments due by Period (In thousands) |
------------------------------- | ---------------- | ------------------------------------- | ------
Contractual Obligations         | Less Than 1 Year | 2-5 Years                             | Total
Operating Lease Obligations:    | $773             | $2,055                                | $2,828
Other Long-Term Liabilities:    |                  |                                       |
Finjan Mobile future commitment | 650              | —                                     | 650
Finjan Blue future commitment   | 2,000            | 2,000                                 | 4,000
Total                           | $3,423           | $4,055                                | $7,478

Obligations
 table summarizes December 31, 2019 obligations five years property lease VPN arrangement Avira asset purchase IBM
 Payments due
 Obligations Less 1 Year 2-5 Years
 Lease Obligations $773 $2,055 $2,828
 Long-Term Liabilities
 Finjan Mobile
 $3,423 $4,055 $7,478


Employee Share Ownership Plan
UK employees are eligible to participate in the Employee Share Ownership Plan (ESOP). The aim of the ESOP is to encourage increased shareholding in the Company by all UK employees and so there are no performance conditions. Employees are invited to join the ESOP when an offer is made each year. Individuals save for 12 months during the accumulation period and subscribe for shares at the lower of the price at the beginning and the end of the accumulation period under HMRC rules. The Company provides a matching share for each share purchased by the individual.
Shares issued under the ESOP have been measured using the Present Economic Value (PEV) valuation methodology. The relevant disclosures in respect of the Employee Share Ownership Plans are set out below.
The accumulation period for the 2019 ESOP ends in September 2020, therefore some figures are projections.

                        | 2015 Grant  | 2016 Grant  | 2017 Grant  | 2018 Grant  | 2019 Grant
----------------------- | ----------- | ----------- | ----------- | ----------- | -----------
Grant date              | 1st October | 1st October | 1st October | 1st October | 1st October
Exercise price          | 2,797.0p    | 4,477.3p    | 5,496.7p    | 7,240.0p    | 7,835.0p
Number of employees     | 1,038       | 1,040       | 1,229       | 1,294       | 1,318
Shares under scheme     | 34,449      | 22,173      | 22,411      | 16,687      | 16,820
Vesting period          | 3 years     | 3 years     | 3 years     | 3 years     | 3 years
Expected volatility     | 21%         | 21%         | 21%         | 19%         | 21%
Risk free interest rate | 0.4%        | 0.1%        | 0.4%        | 0.8%        | 0.5%
Expected dividend yield | 2.5%        | 2.5%        | 2.3%        | 2.0%        | 1.8%
Fair value              | 2,931.3p    | 4,696.7p    | 5,799.0p    | 7,623.7p    | 8,305.1p

Share Ownership
 UK employees eligible. increased shareholding no performance conditions. join offer. save 12 months subscribe shares lower price HMRC rules. Company provides matching share each purchased.
 Shares measured Present Economic Value) valuation methodology. disclosures.
 accumulation period 2019 ESOP ends September 2020 figures projections.
 2015 2016 2017 2018 2019
 Grant date 1st October
 Exercise price 2,797. 4,477. 3p 5,496. 7p 7,240. 7,835.
 employees 1,038 1,229 1,294 1,318
 Shares scheme 34,449 22,173 22,411 16,687 16,820
 Vesting period 3 years
 Expected volatility 21%
 Risk free interest rate 0. 4%. 1%. 8%.
 Expected dividend yield 2. 5%. 5%. 3%. 0%. 8%
 Fair value 2,931. 3p 4,696.5,799. 7,623 8,305.


NOTE 3 - SHORT TERM INVESTMENTS
The Company's short term investments are classified as below with maturities of twelve months or less, unrealized gains and losses were immaterial for the periods presented:

             | December 31    |
------------ | -------------- | -------
             | 2019           | 2018
             | (in thousands) |
Government   | $1,012         | $—
Asset Backed | 4,854          | 1,786
Industrial   | 5,034          | 2,381
Financial    | 6,879          | 7,136
             | $17,779        | $11,303

SHORT TERM INVESTMENTS
 maturities twelve months unrealized gains losses immaterial
 31
 Government $1,012
 Asset Backed 4,854 1,786
 Industrial 5,381
 Financial 6,879 7
 $17,779 $11,303


Selling, General and Administrative Expense
NM—Not meaningful
Total selling, general and administrative (SG&A) expense increased 6.4 percent in 2019 versus 2018, driven primarily by the following factors: • Higher spending (5 points) driven by Red Hat spending (5 points); and • Higher acquisition-related charges and amortization of acquired intangible assets associated with the Red Hat acquisition (3 points); partially offset by • The effects of currency (2 points).
Operating (non-GAAP) expense increased 3.4 percent year to year primarily driven by the same factors excluding the acquisition-related charges and amortization of acquired intangible assets associated with the Red Hat transaction.

($ in millions)                                                  |         |         |
---------------------------------------------------------------- | ------- | ------- | -------------------------
For the year ended December 31:                                  | 2019    | 2018    | Yr.-to-Yr. Percent Change
Selling, general and administrative expense                      |         |         |
Selling, general and administrative—other                        | $17,099 | $16,438 | 4.0%
Advertising and promotional expense                              | 1,647   | 1,466   | 12.3
Workforce rebalancing charges                                    | 555     | 598     | (7.2)
Amortization of acquired intangible assets                       | 762     | 435     | 74.9
Stock-based compensation                                         | 453     | 361     | 25.2
Bad debt expense                                                 | 89      | 67      | 32.5
Total consolidated selling, general and administrative expense   | $20,604 | $19,366 | 6.4%
Non-operating adjustments                                        |         |         |
Amortization of acquired intangible assets                       | (762)   | (435)   | 74.9
Acquisition-related charges                                      | (282)   | (15)    | NM
Operating (non-GAAP) selling, general and administrative expense | $19,560 | $18,915 | 3.4%

Selling General Administrative Expense
 increased. 4 percent 2019 versus 2018 driven Higher spending Red Hat Higher acquisition-related charges amortization Red Hat offset currency.
 Operating (non-GAAP expense increased. 4 percent factors excluding charges amortization Red Hat.
 millions
 year December 31 2019 2018. Percent Change
 Selling administrative expense
 $17,099 $16,438.
 Advertising promotional expense 1,647 1,466.
 Workforce rebalancing charges.
 Amortization intangible assets 762.
 Stock-based compensation.
 Bad debt expense.
 consolidated selling administrative expense $20,604 $19,366. 4%
 Non-operating adjustments
 Amortization acquired intangible assets (762.
 Acquisition-related charges
 Operating (non-GAAP expense $19,560 $18,915.


Foreign Sales
Revenues in each of the Company’s segments include sales to foreign governments or to companies located in foreign countries. For the years ended April 30, 2019 and 2018, revenues, based on the location of the procurement entity and excluding intersegment sales, were derived from the following countries (in thousands):

            | 2019   | 2018
----------- | ------ | -------
Belgium     | $49    | $64
France      | 40     | 154
China       | 359    | 512
Russia      | 2      | 302
Germany     | 36     | 143
Italy       | 159    | 110
South Korea | -      | 314
Singapore   | 215    | 376
Other       | 525    | 469
            | $1,361 | $ 2,444

Foreign Sales
 Revenues segments include governments companies countries. years April 30 2019 2018 revenues procurement derived countries
 2018
 Belgium $49 $64
 France 154
 China 512
 Russia 302
 Germany 143
 Italy 110
 South Korea 314
 Singapore 376
 $1,361 2,444


Results of Operations
The following table sets forth, as a percentage of total revenues, the results from our operations for the periods indicated.

                           | 2019   | 2018
-------------------------- | ------ | ------
Revenues                   | 100.0% | 100.0%
Cost of revenues           | 10.6   | 11.0
Gross profit               | 89.4   | 89.0
Operating expenses:        |        |
Sales and marketing        | 54.2   | 52.6
Product development        | 6.2    | 8.1
General and administrative | 20.5   | 20.9
Total operating expenses   | 80.9   | 81.6
Income from operations     | 8.5    | 7.4
Other income (loss), net   | (0.5)  | —
Income before income taxes | 8.0    | 7.4
Income tax expense         | 4.3    | 3.2
Net income                 | 3.7%   | 4.2%

Operations
 table percentage revenues periods.
 2019 2018
 Revenues 100. 0%
 revenues 10. 11.
 profit 89.
 Operating expenses
 Sales marketing 54. 52.
 Product development 6. 8.
 20.
 operating expenses 80. 81.
 Income operations 8. 5 7.
 income.
 Income taxes 8. 7.
 tax expense 4. 3 3
 Net income. 7%.


Cost of Revenue, Gross Profit and Gross Margin
Cost of revenue
Cost of products revenue is primarily comprised of cost of third-party manufacturing services and cost of inventory for the hardware component of our products. Cost of products revenue also includes warehouse personnel costs, shipping costs, inventory write-downs, certain allocated facilities and information technology infrastructure costs, and expenses associated with logistics and quality control.
Cost of services revenue is primarily comprised of personnel costs for our technical support, training and professional service teams. Cost of services revenue also includes the costs of inventory used to provide hardware replacements to end- customers under PCS contracts and certain allocated facilities and information technology infrastructure costs.
A summary of our cost of revenue is as follows (dollars in thousands):

                      | Years Ended December 31, |         | Increase (Decrease) |
--------------------- | ------------------------ | ------- | ------------------- | -------
                      | 2019                     | 2018    | Amount              | Percent
Cost of revenue:      |                          |         |                     |
Products              | $29,816                  | $34,066 | $(4,250)            | (12)%
Services              | 19,065                   | 17,830  | 1,235               | 7%
Total cost of revenue | $48,881                  | $51,896 | $(3,015)            | (6)%

Cost Revenue Gross Profit Margin
 third-party manufacturing services inventory hardware. warehouse personnel shipping inventory write-downs facilities infrastructure logistics quality control.
 services personnel technical support training service. inventory hardware replacements facilities information technology infrastructure.
 summary cost revenue
 Years Ended December 31, Increase
 2019 2018 Amount Percent
 Cost
 Products $29,816  $34,066  $(4,250) (12)%
 Services 19,065  17,830 1,235 7%
 Total cost revenue $48,881  $51,896  $(3,015) (6)%


The number of options outstanding and exercisable as at 31 March was as follows:
The weighted average market value per ordinary share for PSP options exercised in 2019 was 445.0p (2018: n/a). The PSP awards outstanding at 31 March 2019 have a weighted average remaining vesting period of 0.8 years (2018: 1.2 years) and a weighted average contractual life of 7.6 years (2018: 8.2 years).

                              | 2019      | 2018
----------------------------- | --------- | ---------
                              | Number    | Number
Outstanding at 1 April        | 3,104,563 | 2,682,738
Options granted in the year   | 452,695   | 1,188,149
Dividend shares awarded       | 9,749     | –
Options forfeited in the year | (105,213) | (766,324)
Options exercised in the year | (483,316) | –
Outstanding at 31 March       | 2.978,478 | 3,104,563
Exercisable at 31 March       | 721,269   | –

options 31 March
 market value share PSP 445. n/a. PSP awards 31 March vesting period. 8 years. contractual life. 6 years.
 Outstanding 1 April 3,104,563 2,682,738
 Options granted,695 1,188,149
 Dividend shares awarded 9,749
 forfeited (105,213) (766,324)
 exercised (483,316)
 31 March. 978,478 3,104,563
 Exercisable 31 March 721,269


Note 9 – Debt Obligations
Debt obligations as of December 27, 2019 and December 28, 2018 consisted of the following:
Senior Secured Term Loan Credit Facility
On June 22, 2016, the Company refinanced its debt structure by entering into a credit agreement (the “Term Loan Credit Agreement”) with a group of lenders for which Jefferies Finance LLC acts as administrative agent and collateral agent. The Term Loan Credit Agreement provides for a senior secured term loan B facility (the “Term Loan Facility”) in an aggregate amount of $305,000 (the loans outstanding under the Term Loan Facility, the “Term Loans”) maturing on June 22, 2022. Additionally, the Term Loan Facility includes an accordion which permits the Company to request that the lenders extend additional Term Loans in an aggregate principal amount of up to $50,000 (less the aggregate amount of certain indebtedness incurred to finance acquisitions) plus an unlimited amount subject to the Company’s Total Leverage Ratio not exceeding 4.90:1.00 on a pro forma basis. Borrowings were used to repay the Company’s senior secured notes, as well as the prior term loan and revolving credit facility. Remaining funds were used for capital expenditures, permitted acquisitions, working capital and general corporate purposes of the Company.
On December 13, 2017, the Company completed a repricing of the Term Loan Facility to reduce Applicable Rate (as defined in the Term Loan Credit Agreement) from 475 basis points to 400 basis points over the London Inter-bank Offered Rate (“LIBOR”). In connection with the repricing, the Company paid debt financing costs of $761 which were capitalized as deferred financing charges.
On July 6, 2018, the Company made a $47,100 prepayment and is no longer required to make quarterly amortization payments on the Term Loans. On November 16, 2018, the Company completed a repricing of the Term Loan Facility to reduce the Applicable Rate from 400 basis points to 350 basis points over LIBOR. In connection with the repricing, the Company paid debt financing costs of $626 which were capitalized as deferred financing charges. The Company wrote off unamortized deferred financing fees of $1,081 as a result of this repricing.
The interest charged on the Term Loans, will be equal to a spread plus, at the Company’s option, either the Base Rate (as defined in the Term Loan Credit Agreement) or LIBOR for one, two, three, six or (if consented to by the lenders) twelve-month interest periods chosen by the Company. The interest rate on the Term Loans at December 27, 2019 was 5.2%.
The Term Loan Facility contains customary affirmative covenants, negative covenants (including restrictions, subject to customary exceptions, on incurring debt or liens, paying dividends, repaying payment subordinated and junior lien debt, disposing assets, and making investments and acquisitions), and events of default for a term loan B facility of this type, as more particularly described in the Term Loan Credit Agreement. As of December 27, 2019, the Company was in compliance with all debt covenants under the Term Loan Credit Agreement.
Asset-Based Loan Facility
On June 29, 2018, the Company entered into a credit agreement (the “ABL Credit Agreement”) with a group of lenders for which BMO Harris Bank, N.A. acts as administrative agent. The ABL Credit Agreement provides for an asset-based loan facility (the “ABL”) in the aggregate amount of up to $150,000. Borrowings under the ABL will be used, and are expected to be used, for capital expenditures, permitted acquisitions, working capital and general corporate purposes of the Company. Availability under the ABL will be limited to a borrowing base equal to the lesser of: (i) the aggregate amount of commitments or (ii) the sum of specified percentages of eligible receivables and eligible inventory, minus certain availability reserves. The co-borrowers under the ABL are entitled on one or more occasions, subject to the satisfaction of certain conditions, to request an increase in the commitments under the ABL in an aggregate principal amount of up to $25,000. The ABL matures on the earlier of June 29, 2023 and 90 days prior to the maturity date of the Company’s Term Loan Facility.
The interest rate charged on borrowing under the ABL is equal to a spread plus, at the Company’s option, either the Base Rate (as defined in the ABL Credit Agreement) or LIBOR (except for swingline loans) for one, two, three, six or (if consented to by the lenders) twelve-month, interest periods chosen by the Company. The Company will pay certain recurring fees with respect to the ABL, including fees on unused lender commitments.
The ABL Credit Agreement contains customary affirmative covenants, negative covenants and events of default as more particularly described in the ABL Credit Agreement. The Company is required to comply with a minimum consolidated fixed charge coverage ratio of 1:1 if the amount of availability under the ABL falls below $10,000 or 10% of the borrowing base.
The Company incurred transaction costs of $877 which were capitalized as deferred financing fees to be amortized over the term of the ABL. On July 6, 2018, the Company borrowed $47,100 under the ABL and made an equivalent prepayment on its Term Loans. On November 22, 2019, the Company fully paid all borrowings outstanding under the ABL and there was no balance outstanding as of December 27, 2019. The weighted average interest rate on our ABL borrowings was approximately 3.7% during fiscal 2019.
As of December 27, 2019, the Company was in compliance with all debt covenants and the Company had reserved $16,641 of the ABL for the issuance of letters of credit. As of December 27, 2019, funds totaling $133,359 were available for borrowing under the ABL.
Convertible Senior Notes
On November 22, 2019, the Company issued $150,000 aggregate principal amount of 1.875% Convertible Senior Notes (the “Senior Notes”). The Senior Notes were issued pursuant to an indenture, dated as of November 22, 2019 (the “Indenture”), between the Company and The Bank of New York Mellon Trust Company, N.A., as trustee. Approximately $43,225 of the net proceeds were used to repay all outstanding borrowings under the ABL and the Company intends to use the remainder for working capital and general corporate purposes, which may include future acquisitions.
The Senior Notes bear interest of 1.875% per annum payable semiannually in arrears on June 1 and December 1 of each year, beginning on June 1, 2020. At any time before the close of business on the scheduled trading day immediately before the maturity date, the Senior Notes will be convertible at the option of holders into shares of the Company’s common stock, together with cash in lieu of any fractional share, at an initial conversion price of approximately $44.20 per share. The conversion price is subject to adjustments upon the occurrence of certain events. The Senior Notes will mature on December 1, 2024, unless earlier converted or repurchased in accordance with their terms.
The Company may not redeem the Senior Notes at its option prior to maturity. In addition, if the Company undergoes a fundamental change, as described in the Indenture, holders may require the Company to repurchase for cash all or part of their Senior Notes at a repurchase price equal to 100% of the principal amount of the Senior Notes to be repurchased, plus accrued and unpaid interest up to, but excluding, the required repurchase date.
The Company incurred transaction costs of approximately $5,082 which were capitalized as deferred financing fees to be amortized over the term of the Senior Notes.
Convertible Unsecured Note
On February 25, 2019, the Company issued a $4,000 convertible unsecured note (the “Unsecured Note”), maturing on June 29, 2023, to Bassian Farms, Inc. (the “Holder”) as partial consideration in the Bassian acquisition. The interest rate charged on the Unsecured Note is 4.5% per annum and increases to 5.0% after the two-year anniversary of the closing date. The Company may, in certain instances beginning eighteen months after issuance of the Unsecured Note, redeem the Unsecured Note in whole or in part for cash or convert the Unsecured Note into shares of the Company’s common stock at the conversion price of $43.93 per share. After the two-year anniversary of the closing date, the Holder may convert the Unsecured Note into shares of the Company’s common stock at the conversion price. Upon a change of control event, the Holder may convert the Unsecured Note into shares of the Company’s common stock at the conversion price or redeem the Unsecured Note for cash.

                                                      | December 27, 2019  | December 28, 2018
----------------------------------------------------- | ------------------ | -----------------
Senior secured term loan                              | $238,129           | $239,745
Convertible senior notes                              | 150,000            | —
Convertible unsecured note                            | 4,000              | —
Finance lease and other financing obligations         | 3,905              | 193
Asset-based loan facility                             | —                  | 44,185
Deferred finance fees and original issue discount     | (9,207)            | (5,893)
Total debt obligations                                | 386,827            | 278,230
Less: current installments                            | (721)              | (61)
Total debt obligations excluding current installments | $386,106           | $278,169

Debt Obligations
 December 27, 2019 28, 2018
 Senior Secured Term Loan Credit Facility
 June 22, 2016, Company refinanced debt structure Jefferies Finance LLC administrative collateral agent. senior secured term loan facility $305,000 maturing June 22, 2022. accordion additional Term Loans $50,000 indebtedness unlimited amount Total Leverage Ratio not 4. 90:1. Borrowings senior secured notes prior term loan revolving credit facility. Remaining funds capital expenditures acquisitions working capital general corporate purposes.
 December 13, 2017 Term Loan Facility Applicable Rate 475 to 400 points London Inter-bank Offered Rate. paid financing costs $761 deferred financing charges.
 July 6, 2018 $47,100 prepayment quarterly amortization payments Term Loans. November 16, 2018 repricing Applicable Rate 400 to 350 over LIBOR. paid financing costs $626 deferred financing charges.Company wrote off unamortized deferred financing fees $1,081 repricing.
 interest Term Loans equal spread plus Base Rate or LIBOR one three six twelve-month interest periods. interest rate Term Loans at December 27, 2019 was 5. 2%.
 Term Loan Facility contains affirmative covenants negative covenants restrictions incurring debt liens paying dividends repaying debt disposing assets investments events default. December 27, 2019 Company compliance with debt covenants.
 June 29, 2018 entered credit agreement BMO Harris Bank. administrative agent. provides asset-based loan facility up to $150,000. Borrowings used for capital expenditures acquisitions working capital general corporate purposes. Availability limited borrowing base equal lesser amount commitments or eligible receivables inventory minus reserves. co-borrowers request increase commitments up to $25,000.ABL matures June 29, 2023 90 days prior maturity Company’s Term Loan Facility.
 interest rate borrowing equal spread plus Base Rate or LIBOR one two three six twelve-month interest periods. recurring fees unused commitments.
 ABL Credit Agreement contains affirmative covenants negative covenants events default. fixed charge coverage ratio 1:1 if availability below $10,000 10% borrowing base.
 transaction costs $877 deferred financing fees amortized. July 6, 2018 borrowed $47,100 prepayment Term Loans. November 22, 2019 paid borrowings no balance outstanding December 27, 2019. average interest rate ABL borrowings 3. 7% 2019.
 debt covenants reserved $16,641 ABL for letters of credit. funds $133,359 available for borrowing ABL.
 November 2019 issued $150,000 1. 875% Convertible Senior Notes. indenture Bank of New York Mellon Trust Company.$43,225 net proceeds borrowings intends remainder working capital corporate purposes future acquisitions.
 Senior Notes bear interest 1. 875% per annum payable semiannually June 1 December 1 beginning June 1, 2020. maturity Notes convertible into common stock initial conversion price $44. 20 per share. conversion price subject adjustments. Notes mature December 1, 2024 unless converted repurchased.
 redeem Senior Notes maturity. fundamental change repurchase cash Notes price 100% principal amount plus accrued unpaid interest.
 incurred transaction costs $5,082 deferred financing fees amortized term Senior Notes.
 February 2019 issued $4,000 convertible unsecured note maturing June 29, 2023 Bassian Farms. consideration Bassian acquisition. interest rate 4. 5% per annum increases 5. 0% after two-year anniversary closing.Company eighteen months after redeem convert shares common stock $43. 93 per share. After two-year anniversary convert. change control convert cash.
 December 27, 2019 December 28, 2018
 Senior secured term loan $238,129 $239,745
 Convertible senior notes 150,000
 unsecured note 4,000
 Finance lease obligations 3,905
 Asset-based loan facility 44,185
 Deferred finance fees issue discount (9,207) (5,893)
 Total debt obligations 386,827 278,230
 current installments (721)
 $386,106 $278,169


Acquisition of AFP
On August 1, 2018, the Company acquired AFP, Inc., a privately held fabricator of foam, corrugated, molded pulp and wood packaging solutions, to join its Product Care division. This acquisition expands our protective packaging offerings in the electronic, transportation and industrial markets with custom engineered applications. We acquired 100% of AFP shares for an estimated consideration of $74.1 million, excluding $3.3 million of cash acquired.
The following table summarizes the consideration transferred to acquire AFP and the final allocation of the purchase price among the assets acquired and liabilities assumed.

                                          | Preliminary          | Measurement |
----------------------------------------- | -------------------- | ----------- | ------------------------
                                          | Allocation           | Period      | Final Allocation
(In millions)                             | As of August 1, 2018 | Adjustments | As of September 30, 2019
Total consideration transferred           | $ 70.8               | $ 3.3       | $ 74.1
Assets:                                   |                      |             |
Cash and cash equivalents                 | 2.9                  | 0.4         | 3.3
Trade receivables, net                    | 30.8                 | —           | 30.8
Inventories, net                          | 7.1                  | —           | 7.1
Prepaid expenses and other current assets | 0.7                  | —           | 0.7
Property and equipment, net               | 3.5                  | (0.4)       | 3.1
Identifiable intangible assets, net       | 18.6                 | 0.7         | 19.3
Goodwill                                  | 21.6                 | 1.0         | 22.6
Other non-current assets                  | 0.7                  | (0.4)       | 0.3
Total assets                              | $ 85.9               | $ 1.3       | $ 87.2
Liabilities:                              |                      |             |
Current portion of long-term debt         | —                    | 0.1         | 0.1
Accounts payable                          | 13.8                 | (2.2)       | 11.6
Other current liabilities                 | 1.3                  | (0.1)       | 1.2
Long-term debt, less current portion      | —                    | 0.2         | 0.2
Total liabilities                         | $ 15.1               | $ (2.0)     | $ 13.1

Acquisition
 August 1, 2018 Company acquired AFP. fabricator foam corrugated molded pulp wood packaging solutions Product Care division. acquisition expands protective packaging electronic transportation industrial markets applications. acquired 100% AFP shares estimated $74. 1 million excluding $3. 3 million cash.
 table summarizes consideration transferred AFP final allocation purchase price assets acquired liabilities assumed.
 Allocation Final Allocation
 August 1 2018 Adjustments September 30, 2019
 Total consideration transferred $ 70. 8 $ 3. 74.
 Assets
 Cash cash equivalents.
 Trade receivables 30.
 Inventories.
 Prepaid expenses current assets.
 Property equipment.
 intangible assets 18.
 Goodwill.
 non-current assets.
 assets $ 85. 87.
 Liabilities
 long-term debt.
 Accounts payable.
 current liabilities.
 Long-term debt less current. 2.
 liabilities $ 15. 13.


Free Cash Flow. We define free cash flow ("FCF"), a non-GAAP financial measure, as cash flow provided by operations less capital expenditures. FCF was$ 24.7 million for fiscal 2019 compared to $4.0 million for fiscal 2018, an increase of $20.7 million.
Non-GAAP financial measures, including FCF, are used for internal management assessments because such measures provide additional insight to investors into ongoing financial performance. In particular, we provide FCF because we believe it offers insight into the metrics that are driving management decisions. We view FCF as an important financial metric as it demonstrates our ability to generate cash and can allow us to pursue opportunities that enhance shareholder value. FCF is a non-GAAP financial measure that should be considered in addition to, not as a substitute for, measures of our financial performance prepared in accordance with GAAP.
A reconciliation of FCF to our financial statements that were prepared using GAAP follows (in millions):

                                            | 2019   | 2018
------------------------------------------- | ------ | ------
Cash flows provided by operating activities | $115.3 | $66.8
Payments for property, plant and equipment  | (90.6) | (62.8)
Free cash flow                              | 24.7   | 4.0

Free Cash Flow. non-GAAP operations less capital expenditures. FCF$ 24. 7 million 2019 $4. 0 million 2018 increase $20. 7 million.
 Non-GAAP measures including FCF internal management assessments insight financial performance. FCF insight management decisions. important generate cash shareholder value. financial performance GAAP.
 reconciliation FCF financial statements GAAP
 2019 2018
 Cash flows operating activities $115. 3 $66. 8
 Payments property plant equipment (90. 6) (62. 8)
 Free cash flow 24. 7 4.


Note 9. Receivables, Net
Receivables, net consisted of the following (in thousands):

                                                                                | December 31, |
---------------------------------------------------------------------------------- | ------------ | --------
                                                                                | 2019         | 2018
Trade accounts receivable, current                                                 | $378,616     | $338,473
Income taxes receivable                                                            | 1,571        | 916
Other                                                                              | 13,440       | 11,132
Receivables, gross                                                                 | 393,627      | 350,521
Less: Allowance for doubtful accounts                                              | 3,480        | 3,096
Receivables,net                                                                    | $390,147     | $347,425
Allowance for doubtful accounts as a percent of trade accounts receivable, current | 0.9%         | 0.9%

9. Receivables
 December 31,
 2019 2018
 Trade accounts receivable $378,616 $338,473
 Income taxes 1,571 916
 13,440 11,132
 393,627 350,521
 Allowance doubtful accounts 3,480
 $390,147 $347,425
 trade accounts.


Cash Flows
The following table summarizes key cash flow activity for the years ended December 31, 2019, 2018, and 2017 (in thousands):
Operating Activities
The increase in net cash provided by operating activities during 2019 was primarily driven by higher cash proceeds from sales of systems projects, including the Sunshine Valley, Sun Streams, and California Flats projects, and advance payments received for sales of solar modules prior to the step down in the U.S. investment tax credit as discussed above. These increases were partially offset by operating expenditures associated with initial ramp of certain Series 6 manufacturing lines and expenditures for the construction of certain projects.
Investing Activities
The decrease in net cash used in investing activities during 2019 was primarily due to higher net sales of marketable securities and restricted investments, partially offset by proceeds associated with the sale of our interests in 8point3 and its subsidiaries in 2018.
Financing Activities
The decrease in net cash provided by financing activities during 2019 was primarily the result of lower net proceeds from borrowings under project specific debt financings associated with the construction of certain projects in Australia, Japan, and India.

                                                                               | 2019       | 2018       | 2017
------------------------------------------------------------------------------ | ---------- | ---------- | ----------
Net cash provided by (used in) operating activities                            | $174,201   | $(326,809) | $1,340,677
Net cash used in investing activities                                          | (362,298)  | (682,714)  | (626,802)
Net cash provided by financing activities                                      | 74,943     | 255,228    | 192,045
Effect of exchange rate changes on cash, cash equivalents and restricted cash. | (2,959)    | (13,558)   | 8,866
Net (decrease) increase in cash, cash equivalents and restricted cash          | $(116,113) | $(767,853) | $914,786

Cash
 table summarizes cash flow 2019 2018 2017
 Operating Activities
 increase net cash 2019 driven sales Sunshine Valley California advance payments solar modules U. investment tax credit. offset expenditures Series 6 manufacturing lines construction projects.
 Investing Activities
 decrease cash higher sales securities restricted investments offset sale 8point3 subsidiaries 2018.
 Financing Activities
 decrease lower proceeds borrowings debt financings Australia Japan India.
 cash operating activities $174,201 $(326,809) $1,340,677
 investing activities (362,298) (682,714) (626,802)
 financing 74,943 255,228 192,045
 Effect exchange rate changes cash equivalents restricted cash. (2,959) (13,558) 8,866
 increase cash equivalents $(116,113) $(767,853) $914,786


Fiscal 2019 compared to fiscal 2018
The following table sets forth our Consolidated Statements of Operations data as a percentage of net revenues for the periods indicated:
Note: The percentages may not add due to rounding.

                                                         | Fiscal Year |
-------------------------------------------------------- | ----------- | ----
                                                         | 2019        | 2018
Net revenues                                             | 100%        | 100%
Cost of revenues                                         | 22          | 21
Gross profit                                             | 78          | 79
Operating expenses:                                      |             |
Sales and marketing                                      | 32          | 33
Research and development                                 | 19          | 20
General and administrative                               | 9           | 12
Amortization of intangible assets                        | 4           | 5
Restructuring, transition and other costs                | 5           | 8
Total operating expenses                                 | 70          | 78
Operating income                                         | 8           | 1
Interest expense                                         | (4)         | (5)
Gain on divestiture                                      | —           | 14
Other expense, net                                       | (1)         | —
Income from continuing operations before income taxes    | 2           | 9
Income tax expense (benefit)                             | 2           | (14)
Income from continuing operations                        | —           | 23
Income from discontinued operations, net of income taxes | —           | —
Net income                                               | 1%          | 24%

2019 2018
 table Consolidated Statements Operations percentage net revenues
 percentages add rounding.
 Net revenues 100%
 Cost revenues 22
 Gross profit 78 79
 Operating expenses
 Sales marketing 32 33
 Research development 19
 General administrative
 Amortization intangible assets
 Restructuring transition costs
 Total operating expenses 70 78
 Operating income 8
 Interest expense
 Gain divestiture
 expense
 Income continuing operations before income taxes
 tax expense
 Income
 discontinued operations taxes
 income 1% 24%