NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except for share and per share data)
NOTE 13 — Derivatives
The effect of derivative instruments on the Consolidated Statements of Earnings is as follows:

                                                                                |        | Years Ended December 31, |
----------------------------------------------------------------------------------- | ------ | ------------------------ | ------
                                                                                | 2019   | 2018                     | 2017
Foreign Exchange Contracts:                                                         |        |                          |
Amounts reclassified from AOCI to earnings:                                         |        |                          |
Net sales                                                                           | $—     | $383                     | $(488)
Cost of goods sold                                                                  | 860    | (6)                      | 497
Selling, general and administrative                                                 | 92     | 107                      | 45
Total amounts reclassified from AOCI to earnings                                    | 952    | 484                      | 54
Loss recognized in other expense for hedge ineffectiveness                          | —      | —                        | (1)
Loss recognized in other expense for derivatives not designated as cash flow hedges | —      | —                        | (15)
Total derivative gain on foreign exchange contracts recognized in earnings          | $952   | $484                     | $38
Interest Rate Swaps:                                                                |        |                          |
Benefit recorded in interest expense                                                | $491   | $421                     | $37
Total gain                                                                          | $1,443 | $905                     | $75

CONSOLIDATED FINANCIAL STATEMENTS
 13 Derivatives
 effect Earnings
 Years Ended December 31,
 2019 2018 2017
 Foreign Exchange Contracts
 reclassified earnings
 Net sales $383 $(488)
 Cost goods sold 860
 Selling administrative
 amounts reclassified AOCI earnings 952 54
 Loss hedge ineffectiveness
 Loss cash hedges
 derivative gain foreign exchange contracts earnings $952 $484 $38
 Interest Rate Swaps
 Benefit expense $491 $421 $37
 Total gain $1,443 $905 $75


(1) Mr. Clark did not receive a FY19 EAIP payout.
(2) Pursuant to the terms of Mr. Noviello’s Transition Services Agreement dated January 31, 2019 (the ‘‘Transition Services Agreement’’), Mr. Noviello received 75% of his target FY19 EAIP amount under the Company’s Executive Severance Plan because it was greater than the amount that he would have earned under the FY19 EAIP irrespective of individual performance.
(3) Ms. Cappellanti-Wolf and Messrs. Kapuria and Taylor each earned an individual performance factor of 100%. In determining the appropriate individual performance factor for each of these executives, the Compensation Committee, with recommendation of the CEO, considered leadership, contributions to NortonLifeLock’s achievement of its goals, and strategic planning among other factors.
(4) The Compensation Committee did not exercise its discretion to reduce any payouts.

                           | FY19 EAIP NEO Payout Amounts |                             |                                 |                                   |
-------------------------- | ---------------------------- | --------------------------- | ------------------------------- | --------------------------------- | -------------------------------
NEO                        | Base Salary                  | Annual Incentive Target (%) | Company Performance Funding (%) | Individual Performance Factor (%) | Individual Payout Amount ($)(4)
Gregory S. Clark(1)        | 1,000,000                    | 150                         | n/a                             | n/a                               | 0
Nicholas R. Noviello(2)    | 650,000                      | 100                         | n/a                             | n/a                               | 487,500
Amy L. Cappellanti-Wolf(3) | 440,000                      | 70                          | 35.6                            | 100                               | 109,648
Samir Kapuria(3)           | 450,000                      | 100                         | 35.6                            | 100                               | 152,172
Scott C. Taylor(3)         | 600,000                      | 100                         | 35.6                            | 100                               | 213,600

. Clark receive FY19 EAIP payout.
. Noviello’s Transition Services Agreement January 31, 2019. received 75% target FY19 EAIP Executive Severance Plan greater FY19 EAIP.
. Cappellanti-Wolf. Kapuria Taylor earned performance factor 100%. Compensation Committee considered leadership contributions strategic planning.
 Compensation Committee reduce payouts.
 FY19 EAIP Payout Amounts
 Base Salary Annual Incentive Target Company Performance Funding Individual Performance Factor Payout Amount
 Gregory. Clark(1) 1,000,000 150
 Nicholas. Noviello(2) 650,000 487,500
 Amy. Cappellanti-Wolf(3) 440,000. 109,648
 Samir Kapuria(3) 450,000. 152,172
 Scott. Taylor(3) 600,000. 213,600


@ As a policy, N Chandrasekaran, Chairman, has abstained from receiving commission from the Company and hence not stated.
@@ In line with the internal guidelines of the Company, no payment is made towards commission to the Non-Executive Directors of the Company, who are in full time employment with any other Tata company and hence not stated.
* Relinquished the position of Independent Director w.e.f. July 10, 2018.
** Relinquished the position of Independent Director w.e.f. September 28, 2018.
*** Appointed as an Additional and Independent Director w.e.f. December 18, 2018.
**** Appointed as an Additional and Independent Director w.e.f. January 10, 2019.
^ Since the remuneration is only for part of the year, the ratio of their remuneration to median remuneration and percentage increase in remuneration is not comparable and hence, not stated.
^^ Remuneration received in FY 2019 is not comparable with remuneration received in FY 2018 and hence, not stated.
Particulars of employees
The information required under Section 197 of the Act read with Rule 5 of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, are given below:
a. The ratio of the remuneration of each director to the median remuneration of the employees of the Company and percentage increase in remuneration of each Director, Chief Executive Officer, Chief Financial Officer and Company Secretary in the financial year:
b. The percentage increase in the median remuneration of employees in the financial year: 3.70 percent
c. The number of permanent employees on the rolls of Company: 424,285
d. Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration:
The average annual increase was 6 percent in India. However, during the course of the year, the total increase is approximately 7.2 percent, after accounting for promotions and other event based compensation revisions. Employees outside India received a wage increase varying from 2 percent to 5 percent. The increase in remuneration is in line with the market trends in the respective countries.
Increase in the managerial remuneration for the year was 14.66 percent.
e. Affirmation that the remuneration is as per the remuneration policy of the Company:
The Company affirms that the remuneration is as per the remuneration policy of the Company.
f. The statement containing names of top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in a separate annexure forming part of this report. Further, the report and the accounts are being sent to the Members excluding the aforesaid annexure. In terms of Section 136 of the Act, the said annexure is open for inspection at the Registered Office of the Company. Any Member interested in obtaining a copy of the same may write to the Company Secretary.

Name                         | Ratio to median remuneration | % increase in remuneration in the financial year
---------------------------- | ---------------------------- | ------------------------------------------------
Non-executive directors      |                              |
N Chandrasekaran@            | -                            | -
Aman Mehta                   | 51.55                        | 5.00
V Thyagarajan*               | ^                            | ^
Prof Clayton M Christensen** | ^                            | ^
Dr Ron Sommer                | 36.00                        | 4.76
O P Bhatt                    | 35.18                        | 7.50
Aarthi Subramanian@@         | -                            | -
Dr Pradeep Kumar Khosla      | 24.55                        | ^^
Hanne Sorensen***            | ^                            | ^
Keki Mistry***               | ^                            | ^
Don Callahan****             | ^                            | ^
Executive directors          |                              |
Rajesh Gopinathan            | 262.30                       | 28.31
N Ganapathy Subramaniam      | 190.01                       | 24.88
Chief Financial Officer      |                              |
Ramakrishnan V               | -                            | 22.58
Company Secretary            |                              |
Rajendra Moholkar            | -                            | 18.23

N Chandrasekaran Chairman abstained receiving commission not stated.
 no payment commission Non-Executive Directors full time other Tata company.
 Relinquished Independent Director. July 10, 2018.
 Relinquished Independent Director. September 28, 2018.
 Appointed Additional Independent Director. December 18, 2018.
 Appointed Director. January 10, 2019.
 remuneration part year ratio median percentage increase not comparable not stated.
 Remuneration FY 2019 not comparable 2018 not stated.
 information required Section 197 Act Rule 5 Companies
 Remuneration Managerial Personnel Rules 2014,
. ratio remuneration director to median percentage increase
. percentage increase median remuneration 3. 70 percent
. number permanent employees 424,285
. Average percentile increase salaries last financial year comparison managerial justification exceptional circumstances
 average annual increase 6 percent India. total increase approximately 7. 2 percent promotions compensation revisions. Employees outside India wage increase 2 percent to 5.increase remuneration line with market trends countries.
 Increase managerial remuneration. 66 percent.
. Affirmation remuneration policy Company
 affirms remuneration policy.
. statement names top ten employees remuneration particulars Section 197(12) Act Rule 5(2) 5(3) Companies Remuneration Rules separate annexure. report accounts sent to Members. Section 136 annexure open for inspection Registered Office Company. Member write Company Secretary.
 Ratio to median remuneration % increase remuneration financial year
 Non-executive directors
 Chandrasekaran
 Aman Mehta.
 Thyagarajan
 Clayton M
 Ron Sommer.
 Bhatt.
 Aarthi Subramanian@@
 Pradeep Kumar Khosla.
 Hanne Sorensen***
 Keki Mistry***
 Don
 Executive directors
 Rajesh Gopinathan.
 Ganapathy Subramaniam.
 Chief Financial Officer
 Ramakrishnan.
 Company Secretary
 Rajendra Moholkar.


We make contributions to our defined benefit plans as required under various pension funding regulations. We expect to make contributions of approximately
$1,420 to the international plans in fiscal 2020 based on current actuarial computations
Estimated future benefit payments are as follows:
Savings plans:
We sponsor retirement savings plans, which allow eligible employees to defer part of their annual compensation. Certain contributions by us are discretionary and
are determined by our Board of Directors each year. Our contributions to the savings plans in the United States for the fiscal years ended March 31, 2017, 2018 and 2019
were approximately $4,367, $4,421, and $4,913, respectively.
We also sponsor a nonqualified deferred compensation program, which permits certain employees to annually elect to defer a portion of their compensation until
retirement. A portion of the deferral is subject to a matching contribution by us. The employees select among various investment alternatives, which are the same as are
available under the retirement savings plans, with the investments held in a separate trust. The value of the participants’ balances fluctuate based on the performance of
the investments. The market value of the trust at March 31, 2018 and 2019 of $6,649 and $4,693, respectively, is included as an asset and a liability in our accompanying
balance sheet because the trust’s assets are both assets of the Company and a liability as they are available to general creditors in certain circumstances

Fiscal Year ended March 31, | US Plans | International Plans
--------------------------- | -------- | -------------------
2020                        | $2,295   | $7,055
2021                        | 2,333    | 7,197
2022                        | 2,353    | 7,337
2023                        | 2,371    | 7,624
2024                        | 2,388    | 7,624
2025-2029                   | 11,880   | 40,364

contributions defined benefit plans pension regulations. expect
 $1,420 international plans 2020
 future benefit payments
 sponsor retirement savings plans defer annual compensation. contributions discretionary
 determined Board Directors. contributions years 2017 2018 2019
 $4,367 $4,421 $4,913.
 sponsor nonqualified deferred compensation program compensation
 retirement. deferral subject matching contribution. employees select investment alternatives
 separate trust. value balances fluctuate performance
 investments. market value trust March 31, 2018 2019 $6,649 $4,693 asset liability
 balance sheet
 Fiscal Year March 31, US International Plans
 2020 $2,295 $7,055
 2021 2,333 7,197
 2022 2,353 7,337
 2023 2,371 7,624
 2024 2,388
 2025-2029 11,880 40,364


The following table summarizes information regarding common stock share awards granted and vested (in thousands, except per share award amounts):
As of December 31, 2019, there was $0.2 million of total unrecognized compensation costs, net of actual forfeitures, related to nonvested common stock share awards. This cost is expected to be recognized over a weighted average period of 0.8 years.

                                                       |        | Years Ended December 31, |
------------------------------------------------------ | ------ | ------------------------ | ------
                                                       | 2019   | 2018                     | 2017
Number of share awards granted                         | 34     | 34                       | 24
Weighted average grant-date fair value per share award | $25.41 | $27.68                   | $32.93
Fair value of share awards vested                      | $840   | $880                     | $850

table summarizes common stock awards granted vested
 December 31, 2019 $0. 2 million unrecognized compensation costs nonvested stock awards. recognized. 8 years.
 Ended December 31,
 share awards granted 34
 grant-date value per share award $25. $27. $32.
 awards vested $840 $880 $850


In connection with the asset-backed securitization programs, the Company recognized the following (in millions):
(1) The amounts primarily represent proceeds from collections reinvested in revolving-period transfers.
(2) Recorded to other expense within the Consolidated Statements of Operations.
(3) Excludes $650.3 million of trade accounts receivable sold, $488.1 million of cash and $13.9 million of net cash received prior to the amendment of the foreign asset-backed securitization program and under the previous North American asset-backed securitization program.
The asset-backed securitization programs require compliance with several covenants. The North American asset-backed securitization program covenants include compliance with the interest ratio and debt to EBITDA ratio of the five-year unsecured credit facility amended as of November 8, 2017 (“the 2017 Credit Facility”). The foreign asset-backed securitization program covenants include limitations on certain corporate actions such as mergers and consolidations. As of August 31, 2019 and 2018, the Company was in compliance with all covenants under the asset-backed securitization programs.

                                                    |         | Fiscal Year Ended August 31, |
--------------------------------------------------- | ------- | ---------------------------- | ------
                                                    | 2019(3) | 2018                         | 2017
Trade accounts receivable sold                      | $4,057  | $8,386                       | $8,878
Cash proceeds received(1)                           | $4,031  | $7,838                       | $8,300
Pre-tax losses on sale of receivables(2)            | $26     | $15                          | $9
Deferred purchase price receivables as of August 31 | $—      | $533                         | $569

asset-backed securitization programs Company recognized
 proceeds transfers.
 Recorded Consolidated Statements Operations.
 Excludes $650. 3 million trade accounts sold $488. 1 million cash $13. 9 million net cash American program.
 require covenants. interest ratio debt to EBITDA ratio five-year unsecured credit facility 2017. limitations actions mergers consolidations. August 31, 2019 2018 Company covenants.
 Fiscal Year Ended August 31,
 Trade accounts sold $4,057 $8,386 $8,878
 Cash proceeds $4,031 $7,838 $8,300
 Pre-tax losses sale $26 $15 $9
 Deferred purchase price receivables August 31 $533 $569


6.3 Changes in group structure
Discontinued operations
On 21 December 2018, the Group executed a share sale agreement to sell Infochoice Pty Ltd, a wholly owned subsidiary.
At 30 June 2019, Infochoice Pty Ltd was classified as a discontinued operation. The business of Infochoice Pty Ltd represented the Group’s financial services and products comparison operating segment. With Infochoice Pty Ltd being classified as a discontinued operation, its operating results are no longer presented in the segment note. The sale of Infochoice Pty Ltd was completed on 18 February 2019. The results of Infochoice Pty Ltd for the period are presented below:

                                                      | CONSOLIDATED   |
----------------------------------------------------- | -------------- | --------------
                                                      | JUN 2019 $’000 | JUN 2018 $’000
Revenue                                               | 426            | 1,208
Expenses                                              | (1,035)        | (989)
Operating income                                      | (609)          | 219
Interest revenue                                      | 5              | 9
Impairment of other intangible assets                 | (603)          | (16,902)
Profit/(loss) before tax from discontinued operations | (1,207)        | (16,674)
Tax benefit/(expense) related to current pre-tax loss | (1,150)        | (55)
Post-tax profit/(loss) of  discontinued operations    | (2,357)        | (16,729)

. group structure
 Discontinued operations
 21 December 2018 Group sale Infochoice Pty Ltd subsidiary.
 30 June 2019 discontinued. financial services products. results. sale completed 18 February 2019. results
 2019 2018
 Revenue 426 1,208
 Expenses (1,035)
 Operating income (609)
 Interest revenue
 Impairment intangible assets (603) (16,902)
 Profit(loss before tax discontinued operations (1,207) (16,674)
 Tax benefit pre-tax loss (1,150)
 Post-tax profit(loss (2,357) (16,729)


Fiscal 2018 Restructuring Plan
During Fiscal 2018 and in the context of our acquisitions of Covisint, Guidance and Hightail (each defined below), we began to implement restructuring activities to streamline our operations (collectively referred to as the Fiscal 2018 Restructuring Plan). The Fiscal 2018 Restructuring Plan charges relate to workforce reductions and facility consolidations. These charges require management to make certain judgments and estimates regarding the amount and timing of restructuring charges or recoveries. Our estimated liability could change subsequent to its recognition, requiring adjustments to the expense and the liability recorded. On a quarterly basis, we conduct an evaluation of the related liabilities and expenses and revise our assumptions and estimates as appropriate.
Since the inception of the plan, approximately $10.7 million has been recorded within "Special charges (recoveries)" to date. We do not expect to incur any further significant charges relating to this plan.
A reconciliation of the beginning and ending liability for the year ended June 30, 2019 and 2018 is shown below.

Fiscal 2018 Restructuring Plan                  | Workforce reduction | Facility costs | Total
----------------------------------------------- | ------------------- | -------------- | -------
Balance payable as at June 30, 2017             | $—                  | $—             | $—
Accruals and adjustments                        | 8,511               | 1,643          | 10,154
Cash payments                                   | (8,845)             | (489)          | (9,334)
Foreign exchange and other non-cash adjustments | 892                 | 11             | 903
Balance payable as at June 30, 2018             | $558                | $1,165         | $1,723
Accruals and adjustments                        | (20)                | 535            | 515
Cash payments                                   | (337)               | (928)          | (1,265)
Foreign exchange and other non-cash adjustments | (51)                | (286)          | (337)
Balance payable as at June 30, 2019             | $150                | $486           | $636

Fiscal 2018 Restructuring Plan
 Covisint Guidance Hightail restructuring activities Plan. charges workforce reductions facility consolidations. require judgments estimates. liability adjustments. quarterly revise assumptions estimates.
 $10. 7 million recorded charges. further charges.
 reconciliation liability June 30, 2019 2018.
 Fiscal 2018 Restructuring Plan Workforce reduction Facility costs
 Balance June 30, 2017 $—
 Accruals adjustments 8,511 1,643 10,154
 Cash payments (8,845) (489) (9,334
 Foreign exchange non-cash adjustments 892
 Balance June 30, 2018 $558 $1,165 $1,723
 Accruals adjustments 535
 Cash payments (337) (928) (1,265)
 Foreign exchange non-cash adjustments (51) (286)
 Balance June 30, 2019 $150 $486 $636


Operating Revenues and Selected Operating Statistics
(1) Service and other revenues included in our Business segment amounted to approximately $27.9 billion and $28.1 billion for the years ended December 31, 2019 and 2018, respectively. Wireless equipment revenues included in our Business segment amounted to approximately $3.5 billion and $3.4 billion for the years ended December 31, 2019 and 2018, respectively. (2) As of end of period (3) Includes certain adjustments
Business revenues decreased $91 million, or 0.3%, during 2019 compared to 2018, primarily due to decreases in Global Enterprise and Wholesale revenues, partially offset by increases in Small and Medium Business and Public Sector and Other revenues.
Global Enterprise Global Enterprise offers services to large businesses, which are identified based on their size and volume of business with Verizon, as well as non-U.S. public sector customers. Global Enterprise revenues decreased $383 million, or 3.4%, during 2019 compared to 2018, primarily due to declines in traditional data and voice communication services as a result of competitive price pressures. These revenue decreases were partially offset by increases in wireless service revenue.
Small and Medium Business Small and Medium Business offers wireless services and equipment, tailored voice and networking products, Fios services, IP networking, advanced voice solutions, security and managed information technology services to our U.S.-based customers that do not meet the requirements to be categorized as Global Enterprise.
Small and Medium Business revenues increased $712 million, or 6.6%, during 2019 compared to 2018, primarily due to an increase in wireless postpaid service revenue of 11.7% as a result of increases in the amount of wireless retail postpaid connections.
These increases were further driven by increased wireless equipment revenue resulting from a shift to higher priced units in the mix of wireless devices sold and increases in the number of wireless devices sold, increased revenue related to our wireless device protection package, as well as increased revenue related to Fios services. These revenue increases were partially offset by revenue declines related to the loss of voice and DSL service connections.
Small and Medium Business Fios revenues totaled $915 million and increased $110 million, or 13.7%, during 2019 compared to 2018, reflecting the increase in total connections, as well as increased demand for higher broadband speeds.
Public Sector and Other Public Sector and Other offers wireless products and services as well as wireline connectivity and managed solutions to U.S. federal, state and local governments and educational institutions. These services include the business services and connectivity similar to the products and services offered by Global Enterprise, in each case, with features and pricing designed to address the needs of governments and educational institutions.
Public Sector and Other revenues increased $89 million, or 1.5%, during 2019 compared to 2018, driven by increases in networking and wireless postpaid service revenue as a result of an increase in wireless retail postpaid connections.
Wholesale Wholesale offers wireline communications services including data, voice, local dial tone and broadband services primarily to local, long distance, and wireless carriers that use our facilities to provide services to their customers. Wholesale revenues decreased $509 million, or 13.6%, during 2019 compared to 2018, primarily due to declines in core data and traditional voice services resulting from the effect of technology substitution and continuing contraction of market rates due to competition.

                                      |          |          | (dollars in millions) Increase/ (Decrease) |
------------------------------------- | -------- | -------- | ------------------------------------------ | ------
Years Ended December 31,              | 2019     | 2018     | 2019 vs. 2018                              |
Global Enterprise                     | $ 10,818 | $ 11,201 | $ (383)                                    | (3.4)%
Small and Medium Business             | 11,464   | 10,752   | 712                                        | 6.6
Public Sector and Other               | 5,922    | 5,833    | 89                                         | 1.5
Wholesale                             | 3,239    | 3,748    | (509)                                      | (13.6)
Total Operating Revenues(1)           | $ 31,443 | $ 31,534 | $ (91)                                     | (0.3)
Connections (‘000):(2)                |          |          |                                            |
Wireless retail postpaid connections  | 25,217   | 23,492   | 1,725                                      | 7.3
Fios Internet connections             | 326      | 307      | 19                                         | 6.2
Fios video connections                | 77       | 74       | 3                                          | 4.1
Broadband connections                 | 489      | 501      | (12)                                       | (2.4)
Voice connections                     | 4,959    | 5,400    | (441)                                      | (8.2)
Net Additions in Period (‘000):(3)    |          |          |                                            |
Wireless retail postpaid              | 1,391    | 1,397    | (6)                                        | (0.4)
Wireless retail postpaid phones       | 698      | 625      | 73                                         | 11.7
Churn Rate:                           |          |          |                                            |
Wireless retail postpaid              | 1.24%    | 1.19%    |                                            |
Wireless retail postpaid phones       | 0.99%    | 0.98%    |                                            |

Operating Revenues Statistics
 Service revenues Business segment $27. 9 billion $28. 1 billion 2019 2018. Wireless equipment revenues $3. 5 billion $3. 4 billion.
 Business revenues decreased $91 million 0. 3% 2019 Global Enterprise Wholesale revenues increases Small Medium Business Public Sector revenues.
 Global Enterprise offers services large businesses non-U. S. public sector customers. revenues decreased $383 million 3. 4% 2019 declines data voice communication services competitive price pressures. offset increases wireless service revenue.
 Small Medium Business offers wireless services equipment voice networking products Fios services IP networking voice solutions security information technology services. customers.
 Small Medium Business revenues increased $712 million 6. 6% 2019 wireless postpaid service revenue 11. 7%.
 increased wireless equipment revenue protection package Fios services. offset declines loss voice service connections.
 Fios revenues $915 million increased $110 million 13.2019 compared 2018 increase connections demand higher broadband speeds.
 Public Sector offers wireless products services wireline connectivity solutions. federal state local governments educational institutions. services include business services connectivity Global Enterprise features pricing governments educational institutions.
 Sector revenues increased $89 million. 5% 2019 networking wireless postpaid revenue connections.
 Wholesale offers wireline communications services data voice local dial broadband local long distance wireless carriers. revenues decreased $509 million. 6% 2019 declines data voice services technology substitution contraction market rates.
 Increase
.
 Global Enterprise $ 10,818 $ 11,201.
 Small Medium Business 11,464 10,752.
 Public Sector Other 5,922 5,833.
 Wholesale 3,239 3,748.
 Total Operating $ 31,443 $ 31,534.
 Wireless retail postpaid connections 25,217 23,492 1,725.
Internet connections 326 307 19.
 video 77 74 3.
 Broadband connections 489 501  (12).
 Voice connections 4,959 5,400  (441).
 Net Additions
 Wireless postpaid 1,391 1,397.
 phones 698 625  73 11.
 Rate
. 24%. 19%
 phones. 99%. 98%


Operational performance
A Leasing activity
We agreed 205 long-term leases in 2019, amounting to £26 million annual rent, at an average of 1 per cent above previous passing rent (like-for-like units) and in line with valuers’ assumptions. On a net effective basis (net of rent frees and incentives), rents were also 1 per cent ahead of previous rents. The upside from these new lettings added to like-for-like net rental income but was lower in magnitude than the negative impacts from administrations and CVAs and increased vacancy (see financial review on pages 30 to 37).
Our customers continue to focus on increasing their space in prime, high footfall retail and leisure destinations. Significant activity in 2019 included:
—pureplay online brands starting to open stores to increase their physical presence. Morphe, the digital native cosmetics brand, opened three of its six UK stores at intu Victoria Centre, intu Eldon Square and Manchester Arndale, and AliExpress, the consumer platform of Alibaba, opened its first store in Europe at intu Xanadú
—Harrods taking its first shopping centre store, launching a new beauty concept, H Beauty, at intu Lakeside
—a new flagship store for Zara at St David’s, Cardiff, where it is moving into the centre from the high street. This follows the recent upsizing of stores at intu Trafford Centre and intu Lakeside
—leisure brands increasing their space with Puttshack to open its fourth venue at intu Watford, following its successful opening at intu Lakeside. Namco is expanding its range of attractions at intu Metrocentre with Clip ‘n Climb and the first Angry Birds Adventure Golf in the UK and Rock Up is taking space at intu Lakeside
—international fashion brands continuing to expand in the UK with Spanish brand Mango due to open at intu Watford a
B Investment by customers
In the year, 256 units opened or refitted in our centres (2018: 262 stores), representing around 8 per cent of our 3,300 units. Our customers have invested around £125 million in these stores, which we believe is a significant demonstration of their long-term commitment to our centres.
C Rent reviews
We settled 159 rent reviews in 2019 for new rents totalling £45 million, an average uplift of 6 per cent on the previous rents.
D Occupancy
Occupancy was 94.9 per cent, in line with June 2019 (95.1 per cent), but a reduction against 31 December 2018 (96.7 per cent), impacted by units closed in the first half of 2019 from tenants who went into administration or through a CVA process in 2018. This had a 3.7 per cent negative impact on like-for-like net rental income in 2019 from both rents foregone and increased void costs.
E Weighted average unexpired lease term
The weighted average unexpired lease term was 6.3 years (31 December 2018: 7.2 years) illustrating the longevity of our income streams. The reduction against the prior year was primarily due to new lease terms on department stores that have been through a CVA or administration process.
F Footfall
Footfall in our centres increased by 0.3 per cent in the year. UK footfall was flat, significantly outperforming the Springboard footfall monitor for shopping centres which was down on average by 2.5 per cent. We believe this highlights the continued attraction of our compelling destinations against the wider market. In Spain, footfall was up by 3.5 per cent.
G Retailer sales
Estimated retailer sales in our UK centres, which totalled £5.2 billion in 2019, were down 1.6 per cent, impacted by some larger space users who have had difficulties and been through CVAs and those brands who operate successful multichannel models where in-store sales figures take no account of the benefit of the store to online sales. This compares favourably to the British Retail Consortium (BRC), where non-food retailer sales in-store were down 3.1 per cent on average in 2019.
The ratio of rents to estimated sales for standard units remained stable in 2019 at 12.0 per cent. This does not take into account the benefit to the retailer of their multichannel business, such as click and collect.
H Net promoter score
Our net promoter score, a measure of visitor satisfaction, ran consistently high throughout 2019 averaging 75, an increase of 2 over 2018. Visitor satisfaction is paramount to a shopper’s likelihood to visit, which in turn drives footfall and extended dwell time.
I Gross value of community investment
Gross value added, the measure of the economic contribution of intu to the local communities in the UK, remained stable in the year at £4.8 billion.
J Carbon emission intensity reduction
Annual reduction in carbon emission intensity has reduced in 2019. This is due to our continued focus on energy efficiency to reduce our overall energy demand each year, supported by the ongoing greening of the electricity grid as we become less reliant on coal and increase our renewable generation.
Our 2020 target was to reduce carbon emission intensity by 50 per cent, against a 2010 baseline. We reached this target three years ahead of plan and at the end of 2019, our reduction total was 69 per cent.

                                                          | Notes | 2019      | 201
--------------------------------------------------------- | ----- | --------- | --------
Leasing activity                                          | A     |           |
— number                                                  |       | 205       | 24
— new rent                                                |       | £26m      | £39m
— new rent relative to previous passing rent              |       | +1%       | +6%
Investment by customers                                   | B     | £125m     | £144m
Rental uplift on rent reviews settled                     | C     | +6%       | +7%
Occupancy (EPRA basis)                                    | D     | 94.9%     | 96.7%
— of which, occupied by tenants trading in administration |       | 2.8%      | 2.0%
Unexpired lease term                                      | E     | 6.3 years | 7.2 year
Footfall                                                  | F     | +0.3%     | –1.6%
Retailer sales                                            | G     | –1.6%     | –2.3%
Net promoter score                                        | H     | 75        | 7
Gross value added of community investment                 | I     | £4.8bn    | £4.8b
Carbon emission intensity reduction                       | J     | 15%       | 17%

performance
 Leasing activity
 agreed 205 long-term leases 2019 £26 million annual rent average 1 per cent above previous rent valuers’ assumptions. rents 1 per cent ahead previous. new lettings like-for-like net rental income lower negative impacts administrations CVAs increased vacancy review.
 customers increasing space prime high footfall retail leisure destinations. activity 2019
 online brands stores. Morphe opened three stores Victoria Centre Eldon Square Manchester Arndale AliExpress first store Europe
 first centre store H Beauty Lakeside
 new flagship store Zara St David’s Cardiff. Trafford Centre Lakeside
 brands Puttshack fourth venue Watford. Namco attractions Metrocentre Climb Angry Birds Adventure Golf Rock Up Lakeside
 fashion brands Spanish Mango intu Watford
 256 units opened refitted centres 262 8 per cent of 3,300 units. customers invested £125 million in stores long-term commitment.
Rent reviews
 settled 159 2019 new rents £45 million average uplift 6 per cent.
 Occupancy
 94. 9 per cent June 2019 (95. 1 per reduction 31 December 2018 (96. 7 per impacted units closed CVA. 3. 7 per cent negative impact-for-like net rental income void costs.
 unexpired lease term
 6. 3 years. 2 years. reduction due new lease terms stores CVA administration.
 Footfall
 increased. 3 per cent. outperforming Springboard 2. 5 per cent. destinations Spain footfall up 3. 5 per cent.
 Retailer sales
 £5. 2 billion 2019 down 1. 6 per cent impacted larger space users CVAs multichannel models. British Retail Consortium non-food retailer sales down 3. 1 per cent 2019.
 ratio rents to sales standard units stable 12. per cent. multichannel business.
 Net promoter score
net promoter score visitor satisfaction high 2019 75 increase 2 over 2018. paramount drives footfall extended dwell time.
 community investment
 contribution stable £4. 8 billion.
 Carbon emission intensity reduction
 reduced 2019. due focus energy efficiency greening electricity renewable generation.
 2020 target reduce carbon emission intensity 50 per cent 2010 baseline. reached years end 2019 reduction 69 per cent.
 Leasing activity
 new rent £26m £39m
 +1% +6%
 Investment customers £125m £144m
 Rental uplift settled +6% +7%
 Occupancy. 7%
 occupied tenants 2. 8%. 0%
 Unexpired lease term 6. 3 years 7. 2
. 3% –1. 6%
 Retailer sales. 6% –2. 3%
 Net promoter score 75 7
 Gross value community investment £4. 8bn.
emission reduction 17%


Asset position of METRO AG
ASSETS
As of the closing date, METRO had total assets of €18,221 million, which are predominantly comprised of financial assets in the amount of €9,005 million, receivables from affiliated companies at €8,214 million and the usufructuary rights to the METRO and MAKRO brands which were recognised as an intangible asset (€883 million). Cash on hand, bank deposits and cheques amounted to €44 million. The financial assets predominantly consist of shares held in affiliated companies in the amount of €8,964 million which are essentially comprised of shares in the holding for wholesale companies (€6,693 million), in real estate companies (€1,278 million), in service providers (€470 million) and in other companies (€523 million). The financial assets account for 49.4% of the total assets. Receivables from affiliated companies amount to €8,214 million. This corresponds to 45.1% of the total assets. This position contains €6,117 million in receivables from a group-internal transfer of shares in affiliated companies at their carrying values and predominantly reflects the short-term financing requirements of the group companies as of the closing date.

€ million                               | 30/9/2018 | 30/9/2019
--------------------------------------- | --------- | ---------
Non-current assets                      |           |
Intangible assets                       | 1,001     | 939
Tangible assets                         | 2         | 3
Financial assets                        | 9.157     | 9,005
                                        | 10.160    | 9,947
Current assets                          |           |
Receivables and other assets            | 6,882     | 8,218
Cash on hand, bank deposits and cheques | 335       | 44
                                        | 7,217     | 8,262
Deferred income                         | 12        | 12
                                        | 17,389    | 18,221

METRO
 assets €18,221 million financial assets €9,005 million receivables €8,214 million usufructuary rights METRO MAKRO brands intangible asset (€883 million. Cash bank deposits cheques €44 million. financial assets shares affiliated companies €8,964 million wholesale (€6,693 real estate (€1,278 service providers (€470 million other companies (€523 million. financial assets 49. 4% total. Receivables €8,214 million. 45. 1% total assets. €6,117 million receivables transfer shares short-term financing requirements.
 million 30/9/2018 30/9/2019
 Non-current assets
 Intangible assets
 Tangible assets
 Financial assets.
.
 Current assets
 Receivables other assets
 Cash deposits cheques
 Deferred income


The following table presents the basic and diluted weighted-average number of shares of common stock (amounts in thousands, except per share data):
(1) Fiscal years ending March 31, 2018 and 2017 adjusted due to the adoption of ASC 606.

                                            |          | Fiscal Years Ended March 31, |
------------------------------------------- | -------- | ---------------------------- | -------
                                            | 2019     | 2018                         | 2017
Numerator                                   |          |                              |
Net income (1)                              | $206,587 | $254,127                     | $47,157
Denominator:                                |          |                              |
Weighted-average common shares outstanding: |          |                              |
Basic                                       | 57,840   | 52,798                       | 46,552
Assumed conversion of employee stock grants | 1,242    | 2,291                        | 2,235
Assumed conversion of warrants              | —        | 3,551                        | 6,602
Diluted                                     | $59,082  | $58,640                      | $55,389
Net income per basic share (1)              | $3.57    | $4.81                        | $1.01
Net income per diluted share (1)            | $3.50    | $4.33                        | $0.85

table presents basic diluted shares common stock
 Fiscal years 2018 2017 adjusted ASC 606.
 Years Ended
 2018 2017
 Net income $206,587 $254,127 $47,157
 Weighted-average shares
 Basic 57,840 52,798 46,552
 employee stock grants 2,291
 warrants 3,551
 Diluted $59,082 $58,640 $55,389
 Net income basic share $3. $4.
 income diluted share $3. $4.


Results of Operations
(2) Operating expenses include stock-based compensation expense as follows (in thousands):

                                       |         | Year Ended December 31, |
-------------------------------------- | ------- | ----------------------- | ------
                                       | 2019    | 2018                    | 2017
Stock-based compensation expense data: |         |                         |
Sales and marketing                    | $2,075  | $1,196                  | $561
General and administrative             | 6,474   | 4,901                   | 2,638
Research and development               | 12,054  | 7,332                   | 4,214
Total stock-based compensation expense | $20,603 | $13,429                 | $7,413

Operations
 expenses stock compensation
 Ended December 31,
 Sales marketing $2,075 $1,196 $561
 General administrative 6,474 4,901 2,638
 Research development 12,054 7,332 4,214
 $20,603 $13,429 $7,413


Cogeco Communications is a subsidiary of Cogeco, which holds 31.8% of the Corporation's equity shares, representing 82.3% of the Corporation's voting shares.
Cogeco provides executive, administrative, financial and strategic planning services and additional services to the Corporation under a Management Services Agreement (the "Agreement"). On May 1, 2019, the Corporation and Cogeco agreed to amend the Agreement in order to replace the methodology used to establish the management fees payable by the Corporation to Cogeco, which was based on a percentage of the consolidated revenue of the Corporation, with a new methodology based on the costs incurred by Cogeco plus a reasonable mark-up. This cost-plus methodology was adopted to avoid future variations of the management fee percentage due to the frequent changes of the Corporation's consolidated revenue pursuant to business acquisitions and divestitures. Prior to this change, management fees represented 0.75% of the consolidated revenue from continuing and discontinued operations of the Corporation (0.85% for the period prior to the MetroCast acquisition on January 4, 2018). Provision is made for future adjustment upon the request of either Cogeco or the Corporation from time to time during the term of the Agreement. For fiscal 2019 management fees paid to Cogeco amounted to $19.9 million, compared to $19.0 million for fiscal 2018.
Provision is made for future adjustment upon the request of either Cogeco or the Corporation from time to time during the term of the Agreement. For fiscal 2019 management fees paid to Cogeco amounted to $19.9 million, compared to $19.0 million for fiscal 2018.
The following table shows the amounts that the Corporation charged Cogeco with regards to the Corporation's stock options, ISUs and PSUs granted to these executive officers, as well as DSUs issued to Board directors of Cogeco:

Years ended August 31,             | 2019  | 2018
---------------------------------- | ----- | ----
(In thousands of Canadian dollars) | $     | $
Stock options                      | 1,046 | 915
ISUs                               | 61    | 1
PSUs                               | 981   | 990
DSUs                               | 631   | —

Cogeco Communications subsidiary Cogeco holds 31. 8% Corporation equity shares 82. 3% voting shares.
 Cogeco provides executive administrative financial strategic planning services Management Services Agreement. May 1, 2019 Corporation Cogeco Agreement management fees Cogeco revenue new methodology costs Cogeco mark-up. cost-plus methodology avoid variations management fee revenue acquisitions divestitures. management fees represented 0. 75% consolidated revenue (0. 85% MetroCast acquisition January 4,. Provision future adjustment Cogeco. fiscal 2019 management fees Cogeco $19. 9 million compared $19. 0 million 2018.
 Provision future adjustment. 2019 fees $19. 9 million compared $19. 0 million 2018.
 table Corporation Cogeco stock options PSUs executive officers DSUs Board directors
 Years ended August 31, 2019 2018
 Stock options 1,046 915
 ISUs 61 1
 PSUs 981 990
631


Geographic Information
(1) Amounts by geography have been reclassified from prior year disclosure to reflect adjustments to our regional operating model. As of January 1, 2019, our geographic regions are: North America, EMEA, South America and APAC. Our North American operations include Canada, the United States, Mexico and Central America. Mexico and Central America were previously included in Latin America. Refer to Note 2, "Summary of Significant Accounting Policies and Recently Issued Accounting Standards," of the Notes to Consolidated Financial Statements.
(2) No non-U.S. country accounted for net sales in excess of 10% of consolidated net sales for the years ended December 31, 2019, 2018 or 2017 or long-lived assets in excess of 10% of consolidated long-lived assets at December 31, 2019 and 2018.
(3) Net sales to external customers within the U.S. were $2,501.6 million, $2,402.3 million and $2,280.0 million for the years ended December 31, 2019, 2018 and 2017, respectively.
(4) Total long-lived assets represent total assets excluding total current assets, deferred tax assets, goodwill, intangible assets and non-current assets held for sale.

                                  |           | Year Ended December 31, |
--------------------------------- | --------- | ----------------------- | ---------
(In millions)                     | 2019      | 2018                    | 2017
Net sales(1)(2):                  |           |                         |
North America(3)                  | $ 2,828.1 | $ 2,734.9               | $ 2,591.5
EMEA                              | 1,010.4   | 1,038.5                 | 983.4
South America                     | 233.8     | 229.5                   | 231.8
APAC                              | 718.8     | 729.8                   | 654.9
Total                             | $ 4,791.1 | $ 4,732.7               | $ 4,461.6
Total long-lived assets(1)(2)(4): |           |                         |
North America                     | $ 919.3   | $ 740.5                 |
EMEA                              | 345.8     | 270.5                   |
South America                     | 50.2      | 52.8                    |
APAC                              | 248.3     | 211.8                   |
Total                             | $ 1,563.6 | $ 1,275.6               |

Information
 Amounts reclassified regional operating model. January 1, 2019 regions North America EMEA South America APAC. North American operations include Canada United States Mexico Central America. Latin America. Note 2 Accounting Policies Standards Consolidated Financial Statements.
 No non. sales 10% December 2019 2018 2017.
 Net sales external customers. $2,501. 6 million $2,402. 3 million $2,280. million December 2019 2018 2017.
 long-lived assets current deferred tax goodwill intangible non-current assets.
 Net
 North $ 2,828. $ 2,734. 2,591.
 EMEA 1,010. 1,038. 983.
 South America 233. 229.
 APAC 718. 729. 654.
 $ 4,791. $ 4,732. 4,461.
 long-lived
 North America $ 919. 740.
 EMEA 345. 270.
 South America 50. 52.
APAC. 211. 8
 1,563. 1,275.


For 2019, we reported a net income of $1,032 million, compared to a net income of $1,287 million and $802 million for 2018 and 2017, respectively.
The 2019 net income represented diluted earnings per share of $1.14 compared to $1.41 and $0.89 for 2018 and 2017, respectively.

                                          |        | Year Ended December 31, |
----------------------------------------- | ------ | ----------------------- | ----
                                          | 2019   | 2018                    | 2017
                                          |        | (In millions)           |
Net income attributable to parent company | $1,032 | $1,287                  | $802
As percentage of net revenues             | 10.8%  | 13.3%                   | 9.6%

2019 net income $1,032 million compared $1,287 $802 million 2018 2017.
 diluted earnings share $1. 14. 41. 89 2018 2017.
 Ended December 31,
 income parent company $1,032 $1,287 $802
 revenues. 8%. 3%. 6%


Unearned Revenue
Unearned revenue as of the periods presented consisted of the following (table in millions):
Unearned subscription and SaaS revenue is generally recognized over time as customers consume the services or ratably over the term of the subscription, commencing upon provisioning of the service. Previously, unearned subscription and SaaS revenue was allocated between unearned license revenue and unearned software maintenance revenue in prior periods and has been reclassified to conform with current period presentation.
Unearned software maintenance revenue is attributable to VMware’s maintenance contracts and is generally recognized over time on a ratable basis over the contract duration. The weighted-average remaining contractual term as of January 31, 2020 was approximately two years. Unearned professional services revenue results primarily from prepaid professional services and is generally recognized as the services are performed.
Total billings and revenue recognized during the year ended January 31, 2020, were $8.1 billion and $6.4 billion, respectively, and did not include amounts for performance obligations that were fully satisfied upon delivery, such as on-premise licenses. During the year ended January 31, 2020, VMware assumed $154 million in unearned revenue in the acquisition of Carbon Black, Inc. (“Carbon Black”).
Total billings and revenue recognized during the year ended February 1, 2019, were $6.9 billion and $5.5 billion, respectively, and did not include amounts for performance obligations that were fully satisfied upon delivery, such as on-premise licenses.
Revenue recognized during the year ended February 2, 2018 was $4.8 billion and did not include amounts for performance obligations that were fully satisfied upon delivery, such as on-premise licenses.

                                       | January 31, 2020 | February 1, 2019
-------------------------------------- | ---------------- | ----------------
Unearned license revenue               | $19              | $15
Unearned subscription and SaaS revenue | 1,534            | 916
Unearned software maintenance revenue  | 6,700            | 5,741
Unearned professional services revenue | 1,015            | 767
Total unearned revenue                 | $9,268           | $7,439

Unearned Revenue
 subscription SaaS revenue recognized over time services term. allocated between license software maintenance reclassified.
 software maintenance attributable VMware’s maintenance contracts recognized over time contract duration. contractual term January 31, 2020 two years. professional services revenue prepaid services recognized services performed.
 Total billings revenue January 31, 2020 $8. 1 billion $6. 4 billion performance obligations licenses. VMware assumed $154 million unearned revenue Carbon Black, Inc.
 Total billings revenue February 1, 2019 $6. 9 billion $5. 5 billion obligations.
 Revenue February 2, 2018 $4. 8 billion.
 January 31, 2020 February 1, 2019
 Unearned license revenue $19 $15
 subscription SaaS revenue 1,534 916
 software maintenance 6,700
 professional services revenue 1,015 767
 Total revenue $9,268 $7,439


ALTERNATIVE PERFORMANCE MEASURES
Gross profit:
TORM defines Gross profit, a performance measure, as revenue less port expenses, bunkers and commissions, charter hire and operating expenses. The Company reports Gross profit because we believe it provides additional meaningful information to investors, as Gross profit measures the net earnings from shipping activities. Gross profit is calculated as follows:

USDm                                   | 2019   | 2018   | 2017
-------------------------------------- | ------ | ------ | ------
Reconciliation to revenue              |        |        |
Revenue                                | 692.6  | 635.4  | 657.0
Port expenses, bunkers and commissions | -267.7 | -283.0 | -259.9
Charter hire                           | -      | -2.5   | -8.5
Operating expenses                     | -173.0 | -180.4 | -188.4
Gross profit                           | 251.9  | 169.5  | 200.2

PERFORMANCE MEASURES
 profit
 defines revenue port expenses bunkers commissions charter hire operating expenses. Company reports profit information net earnings shipping activities. calculated
 Reconciliation revenue
 692. 635. 657.
 Port expenses bunkers commissions -267. -259.
 Charter hire. -8.
 Operating expenses -173. -180. -188.
 Gross profit 251. 169. 200.


12. RESTRICTED CASH AND SHORT-TERM DEPOSITS
Our restricted cash and short-term deposits balances are as follows:
(1) Restricted cash relating to the share repurchase forward swap refers to the collateral required by the bank with whom we entered into a total return equity swap. Collateral of 20% of the total purchase price is required and this is subsequently adjusted with reference to the Company's share price. In November 2019, we purchased 1.5 million shares underlying the total return equity swap that resulted in $54.7 million of restricted cash being released (see note 24).
(2) In November 2015, in connection with the issuance of a $400 million letter of credit by a financial institution to our project partner involved in the Hilli FLNG project, we posted an initial cash collateral sum of $305.0 million to support the performance guarantee.
Under the provisions of the $400 million letter of credit, the terms allow for a stepped reduction in the value of the guarantee over time and thus, conversely, a reduction in the cash collateral requirements. In 2017, the $400 million letter of credit and the cash collateral requirement was reduced to $300 million and $174.6 million, respectively, with no further reduction in 2018. In 2019, the letter of credit was reduced to $250.0 million and a contractual amendment further reduced the letter of credit to $125.0 million and the cash collateral to $76.0 million. There is no further contractual reduction expected until 2021.
In November 2016, after certain conditions precedent were satisfied by the Company, the letter of credit required in accordance with the signed LTA was re-issued and, with an initial expiry date of December 31, 2018, the letter of credit automatically extends, on an annual basis, until the tenth anniversary of the acceptance date of the Hilli by the charterer, unless the bank should exercise its option to exit from this arrangement by giving three months' notice prior to the annual renewal date.
(3) These are amounts held by lessor VIE entities that we are required to consolidate under U.S. GAAP into our financial statements as VIEs (see note 5).
(4) This refers to cash deposits required under the $1.125 billion debt facility (see note 18). The covenant requires that, on the second anniversary of drawdown under the facility, where we fall below a prescribed EBITDA to debt service ratio, additional cash deposits with the financial institution are required to be made or maintained.
(5) Collateral held against the Margin Loan facility is required to satisfy one of the mandatory prepayment events within the facility, with this having been triggered when the closing price of the Golar Partners common units pledged by us as security for the obligations under the facility fell below a defined threshold. If certain requirements are met, the facility allows for the release of the collateral (see note 18).
Restricted cash does not include minimum consolidated cash balances of $50.0 million (see note 18) required to be maintained as part of the financial covenants for our loan facilities, as these amounts are included in "Cash and cash equivalents".

(in thousands of $)                                                       | 2019      | 2018
------------------------------------------------------------------------- | --------- | ---------
Restricted cash relating to the total return equity swap (1)              | 55,573    | 82,863
Restricted cash in relation to the Hilli (2)                              | 75,968    | 174,597
Restricted cash and short-term deposits held by lessor VIEs (3)           | 34,947    | 176,428
Restricted cash relating to the $1.125 billion debt facility (4)          | 10,975    | 17,657
Collateral on the Margin Loan facility (5)                                | 10,000    | 33,413
Restricted cash relating to office lease                                  | 826       | 777
Bank guarantee                                                            | —         | 691
Total restricted cash and short-term deposits                             | 188,289   | 486,426
Less: Amounts included in current restricted cash and short-term deposits | (111,545) | (332,033)

. RESTRICTED CASH SHORT-TERM DEPOSITS
 restricted balances
 share repurchase swap collateral required bank total return equity swap. 20% purchase price required adjusted Company's share price. November 2019 purchased 1. 5 million shares $54. 7 million restricted cash released.
 November 2015, $400 million letter credit Hilli FLNG initial cash collateral $305. 0 million performance guarantee.
 stepped reduction value guarantee cash collateral. 2017 reduced to $300 million $174. 6 million no further reduction 2018. 2019 credit reduced to $250. 0 million contractual amendment reduced $125. 0 million cash collateral $76. 0 million. no further reduction until 2021.
 November 2016, letter of credit re-issued expiry date December 31, 2018 extends until tenth anniversary acceptance date Hilli charterer unless bank three months' notice renewal.
 amounts lessor VIE entities consolidate. GAAP financial statements.
 cash deposits required under $1.125 billion debt facility note 18. covenant requires second anniversary drawdown EBITDA debt service ratio additional cash deposits.
 Collateral Margin Loan facility mandatory prepayment triggered closing price Golar Partners units below threshold. requirements met allows release collateral.
 Restricted cash minimum cash balances $50. 0 million "Cash equivalents.
 2019 2018
 Restricted cash total return equity swap 55,573 82,863
 Hilli 75,968 174,597
 lessor VIEs 34,947 176,428
. 125 billion debt facility 10,975 17,657
 Collateral Margin Loan facility 10,000 33,413
 office lease 826 777
 Bank guarantee
 Total restricted cash short-term deposits 188,289  486,426
 current restricted cash-term deposits (111,545) (332,033)


NOTE 4 - ACCOUNTS PAYABLE AND ACCRUED EXPENSES
Accounts payable and accrued expenses consist of the following at:
On October 1 2019, the Company entered into an agreement with a consultant for toxicology studies. The consultant quoted a commitment of approximately $988,000 as an
estimate for the study. 50% of the total price is to be paid upon the signing of the agreement, 35% of the total price is to be upon completion of the in-life study, and the
remaining 15% of the total price is to be paid upon the issuance of the report. If the Company cancels the study the Company will be required to pay a cancelation fee. If the
cancelation happens prior to the arrival of the test animals then the Company will need to pay between 20% and 50% of the animal fees depending on when the cancellation
happens. If the cancellation occurs after the animals arrive but before the study begins then the company will be responsible for paying 50% of the protocol price plus a fee of
$7,000 per room/week for animal husbandry until the animals can be relocated or disposed of. If the Company cancels the study after it has begun then the Company will need to pay any fees for procured items for the study and any nonrecoverable expenses incurred by the vendor. As of December 31, 2019, the Company has paid $0 and there is a balance of $493,905 due.

                         | December 31, 2019 | December 31, 2018
------------------------ | ----------------- | -----------------
Accounting               | $36,161           | $52,365
Research and development | 650,584           | 137,114
Legal                    | 15,273            | 32,161
Other                    | 163,029           | 10,048
Total                    | $865,047          | $231,688

NOTE 4 ACCOUNTS PAYABLE ACCRUED EXPENSES
 October 1 2019 Company agreement consultant studies. consultant $988,000
 estimate study. 50% price paid signing agreement 35% completion in-life study
 15% issuance report. Company cancels study cancelation fee.
 prior test animals 20% 50% animal fees
. after animals 50% protocol price plus fee
 $7,000 per room/week animal husbandry until animals. cancels study after fees items nonrecoverable expenses. December 31, 2019 Company paid $0 balance $493,905 due.
 December 31, 2019 December 31, 2018
 Accounting $36,161 $52,365
 Research development 650,584 137,114
 Legal 15,273 32,161
 Other 163,029 10,048
 Total $865,047 $231,688


27 Financial risk management (continued)
The table below summarises the Group’s exposure to foreign exchange risk as well as the foreign exchange rates applied:
The approximate impact of a 10 per cent appreciation in foreign exchange rates would be a positive movement of £50.0 million (2018: £63.4 million) to equity attributable to owners of the Group. The approximate impact of a 10 per cent depreciation in foreign exchange rates would be a negative movement of £40.9 million (2018: £51.9 million) to equity attributable to owners of the Group. There is no material income statement impact as these exchange differences are recognised in other comprehensive income.
As part of the strategy to mitigate the Group’s exposure to foreign exchange risk, the Group is able to borrow part of its RCF in euros, up to €100 million. The RCF borrowings denominated in euros have been designated as a hedging instrument (net investment hedge) against the Group’s net investment in Spain with the hedged risk being the changes in the euro/pounds sterling spot rate that will result in changes in the value of the Group’s net investments in Spain. At 31 December 2019, €100 million (2018: €100 million) was drawn in euros.

                      | 2019   | 2018   | 2019    | 2018
--------------------- | ------ | ------ | ------- | -------
                      | €m     | €m     | INRm    | INRm
Net exposure          | 468.9  | 555.7  | 5,072.4 | 6,274.5
Foreign exchange rate | 1.1825 | 1.1126 | 94.4586 | 88.3432

Financial risk management
 table summarises Group’s exposure foreign exchange risk rates
 impact 10 per cent appreciation rates positive £50. 0 million (2018: £63. 4 million) to equity owners. 10 per cent depreciation negative £40. 9 million (2018: £51. 9 million) to equity. no material income impact exchange differences recognised in income.
 RCF in euros up to €100 million. borrowings hedging instrument against net investment Spain risk changes euro/pounds sterling spot rate investments. 31 December 2019 €100 million (2018 drawn in euros.
 Net exposure 468. 5,072.
 Foreign exchange rate 1. 1825. 1126. 4586.


NOTE 7. INVENTORIES
The following table details the components of inventories (in thousands).

               | December 31 |
-------------- | ----------- | -----
               | 2019        | 2018
Finished goods | $698        | $853
Raw materials  | 90          | 3
Packaging      | 110         | 102
Inventories    | $ 898       | $ 958

7.
 table components thousands.
 December 31
 Finished goods $698 $853
 Raw materials
 Packaging 110
 Inventories $ $ 958


At May 31, 201 9 , we had federal net operating loss carryforwards of approximately $ 732 million, which are subject to limitation on their utilization. Approximately $ 690 million of these federal net operating losses expire in various years between fiscal 2020 and fiscal 2018 . Approximately $42 million of these federal net operating losses are not currently subject to expiration dates. We had state net operating loss carryforwards of approximately $ 2.2 billion at May 31, 2019 , which expire between fiscal 2020 and fiscal 2018 and are subject to limitations on their utilization. We had total foreign net operating loss carryforwards of approximately $ 2.0 billion at May 31, 2019 , which are subject to limitations on their utilization. Approximately $ 1.9 billion of these foreign net operating losses are not currently subject to expiration dates. The remainder of the foreign net operating losses, approximately $ 100 million, expire between fiscal 2020 and fiscal 2019. We had tax credit carryforwards of approximately $ 1.1 billion at May 31, 2019 , which are subject to limitations on their utilization. Approximately $ 734 million of these tax credit carryforwards are not current ly subject to expiration dates. The remainder of the tax credit carryforwards, approximately $ 387 million, expire in various years between fiscal 2020 and fiscal 2019
We classify our unrecognized tax benefits as either current or non-current income taxes payable in the accompanying consolidated balance sheets. The aggregate changes in the balance of our gross unrecognized tax benefits, including acquisitions, were as follows:
As of May 31, 2019, 2018 and 2017, $4.2 billion, $4.2 billion and $3.4 billion, respectively, of unrecognized tax benefits would affect our effective tax rate if recognized. We recognized interest and penalties related to uncertain tax positions in our provision for income taxes line of our consolidated statements of operations of $312 million, $127 million and $125 million during fiscal 2019, 2018 and 2017, respectively. Interest and penalties accrued as of May 31, 2019 and 2018 were $1.3 billion and $992 million, respectively.
Domestically, U.S. federal and state taxing authorities are currently examining income tax returns of Oracle and various acquired entities for years through fiscal 2017. Many issues are at an advanced stage in the examination process, the most significant of which include the deductibility of certain royalty payments, transfer pricing, extraterritorial income exemptions, domestic production activity, foreign tax credits, and research and development credits taken. With all of these domestic audit issues considered in the aggregate, we believe that it was reasonably possible that, as of May 31, 2019, the gross unrecognized tax benefits related to these audits could decrease (whether by payment, release, or a combination of both) in the next 12 months by as much as $516 million ($357 million net of offsetting tax benefits). Our U.S. federal income tax returns have been examined for all years prior to fiscal 2010 and we are no longer subject to audit for those periods. Our U.S. state income tax returns, with some exceptions, have been examined for all years prior to fiscal 2007 and we are no longer subject to audit for those periods.
Internationally, tax authorities for numerous non-U.S. jurisdictions are also examining returns affecting our unrecognized tax benefits. We believe that it was reasonably possible that, as of May 31, 2019, the gross unrecognized tax benefits could decrease (whether by payment, release, or a combination of both) by as much as $186 million ($87 million net of offsetting tax benefits) in the next 12 months related primarily to transfer pricing.

                                                                    |        | Year Ended May 31, |
------------------------------------------------------------------- | ------ | ------------------ | ------
(in millions)                                                       | 2019   | 2018               | 2017
Gross unrecognized tax benefits as of June 1                        | $5,592 | $4,919             | $4,561
Increases related to tax positions from prior fiscal years          | 772    | 200                | 128
Decreases related to tax positions from prior fiscal years          | (135)  | (65)               | (218)
Increases related to tax positions taken during current fiscal year | 540    | 840                | 595
Settlements with tax authorities                                    | (153)  | (42)               | (85)
Lapses of statutes of limitation                                    | (202)  | (273)              | (47)
Cumulative translation adjustments and other, net                   | (66)   | 13                 | (15)
Total gross unrecognized tax benefits as of May 31                  | $6,348 | $5,592             | $4,919

May 31, federal operating loss carryforwards $ 732 million. 690 million expire 2020 2018. $42 million not expiration. state net operating loss carryforwards $ 2. 2 billion expire 2020 2018. foreign net operating loss carryforwards $ 2. 0 billion limitations. $ 1. 9 billion expiration. $ 100 million expire 2020 2019. tax credit carryforwards $ 1. 1 billion limitations. $ 734 million. $ 387 million expire 2020 2019
 unrecognized tax benefits current non-current income taxes balance. changes unrecognized tax benefits
 May 31, 2019 2018 2017 $4. 2 billion $4. 2 billion $3. 4 billion unrecognized tax benefits affect tax rate recognized. recognized interest penalties uncertain tax positions $312 million $127 million $125 million 2019 2018 2017. Interest penalties accrued May 31, 2019 2018 $1. 3 billion $992 million.
.state authorities examining returns Oracle acquired entities 2017. issues include deductibility royalty transfer pricing extraterritorial income exemptions domestic production activity foreign tax credits research development credits. May 31, 2019 unrecognized tax benefits decrease $516 million ($357 million. federal income tax returns examined 2010 no longer subject audit. state income tax returns examined 2007 longer subject.
 tax authorities non-U. S. jurisdictions examining returns unrecognized tax benefits. May 31, 2019 unrecognized tax benefits decrease $186 million ($87 million net 12 transfer pricing.
 Year Ended May 31,
 2019 2018 2017
 Gross unrecognized tax benefits as of June 1  $5,592 $4,919 $4,561
 Increases tax positions prior fiscal years 772 200  128
 Decreases (135) (65) (218)
 Increases current fiscal year 540  840  595
Settlements tax (153)
 Lapses statutes (202) (273)
 translation adjustments (66)
 tax benefits May 31 $6,348 $5,592


Subscription Revenue by Segment
Our subscription revenue is comprised primarily of fees we charge for our subscription and hosted service offerings including Creative Cloud and certain of our Digital Experience and Document Cloud services. We recognize subscription revenue ratably over the term of agreements with our customers, beginning with commencement of service.
We have the following reportable segments: Digital Media, Digital Experience and Publishing. Subscription revenue by reportable segment for fiscal 2019, 2018 and 2017 is as follows:
(*) Percentage is less than 1%
Our product revenue is primarily comprised of revenue from distinct on-premise software licenses recognized at a point in time and certain of our OEM and royalty agreements. Our services and support revenue is comprised of consulting, training and maintenance and support, primarily related to the licensing of our enterprise offerings and the sale of our hosted Digital Experience services. Our support revenue also includes technical support and developer support to partners and developer organizations related to our desktop products. Our maintenance and support offerings, which entitle customers to receive desktop product upgrades and enhancements or technical support, depending on the offering, are generally recognized ratably over the term of the arrangement.

(dollars in millions)      | 2019     | 2018     | 2017     | % Change 2019 - 2018
-------------------------- | -------- | -------- | -------- | --------------------
Digital Media              | $7,208.3 | $5,857.7 | $4,480.8 | 23%
Digital Experience         | 2,670.7  | 1,949.3  | 1,552.5  | 37%
Publishing                 | 115.5    | 115.2    | 100.6    | *
Total subscription revenue | $9,994.5 | $7,922.2 | $6,133.9 | 26%

Subscription Revenue Segment
 fees service Creative Cloud Digital Experience Document Cloud services. recognize revenue agreements.
 reportable segments Digital Media Digital Experience Publishing. Subscription revenue 2019 2018 2017
 Percentage less than 1%
 product revenue on software licenses OEM royalty agreements. services support revenue consulting training maintenance support licensing enterprise Digital Experience services. support includes technical developer support desktop products. maintenance support offerings desktop upgrades enhancements technical support recognized term arrangement.
 (dollars millions 2019 2018 2017 %
 Digital Media $7,208. $5,857. $4,480. 23%
 Digital Experience 2,670. 1,949. 1,552. 37%
 Publishing.
 Total subscription revenue $9,994. $7,922. $6,133. 26%


Net Income Per Share
Basic net income per share is computed by dividing net income by the weighted-average number of common shares outstanding for the period. Diluted net income per share is computed giving effect to all potentially dilutive common stock and common stock equivalents, including stock options, RSUs and common stock subject to repurchase.
The following table reconciles the shares used in calculating basic net income per share and diluted net income per share (in thousands):

                                                                                |                   | Fiscal Year Ended |
-------------------------------------------------------------------------------- | ----------------- | ----------------- | -----------------
                                                                                | December 28, 2019 | December 29, 2018 | December 30, 2017
Weighted-average shares used in computing basic net income per share             | 74,994            | 73,482            | 72,292
Add potentially dilutive securities                                              | 2,292             | 1,700             | 1,947
Weighted-average shares used in computing basic and diluted net income per share | 77,286            | 75,182            | 74,239

Income Per Share
 computed weighted-average shares. Diluted dilutive common stock equivalents options RSUs repurchase.
 table reconciles shares diluted
 Fiscal Year Ended
 December 28, 2019 December 29, 2018 December 30, 2017
 Weighted-average shares income 74,994 73,482 72,292
 dilutive securities 2,292 1,700 1,947
 Weighted-average shares diluted income 77,286 75,182 74,239


Sales by Contract Type: Substantially all of our contracts are fixed-price type contracts. Sales included in Other contract types represent cost plus and time and material type contracts.
On a fixed-price type contract, we agree to perform the contractual statement of work for a predetermined sales price. On a cost-plus type contract, we are paid our allowable incurred costs plus a profit which can be fixed or variable depending on the contract’s fee arrangement up to predetermined funding levels determined by the customer. On a time-and-material type contract, we are paid on the basis of direct labor hours expended at specified fixed-price hourly rates (that include wages, overhead, allowable general and administrative expenses and profit) and materials at cost. The table below presents total net sales disaggregated by contract type (in millions):

            |            | Years Ended September 30, |
----------- | ---------- | ------------------------- | ----------
            | 2019       | 2018                      | 2017
Fixed Price | $  1,452.4 | $  1,146.2                | $  1,036.9
Other       | 44.1       | 56.7                      | 70.8
Total sales | $1,496.5   | $1,202.9                  | $1,107.7

Sales Contract Type contracts fixed-price. Other types cost plus time material.
 fixed-price contract perform predetermined sales price. cost-plus paid costs plus profit fixed variable funding. time-and-material paid direct labor hours fixed-price hourly rates wages overhead expenses profit materials cost. table total net sales by contract type millions):
 Ended September 30,
 Fixed Price $ 1,452. $ 1,146. $ 1,036.
 44. 56. 70.
 Total sales $1,496. $1,202. $1,107.


Commitments and Significant Contractual Obligations
The following table summarizes our contractual obligations and commercial commitments at December 27, 2019:
(1) Interest on our various outstanding debt instruments is included in the above table, except for our Term Loan and ABL, which have floating interest rates. At December 27, 2019, we had borrowings of $238.1 million under our Term Loan and zero under our ABL. During the fiscal year ended December 27, 2019, the weighted average interest rate on our Term Loan was approximately 5.8% and we incurred interest expense of approximately $13.9 million. During the fiscal year ended December 27, 2019, the weighted average interest rate on our ABL borrowings was approximately 3.7% and we incurred interest expense of approximately $1.6 million. See Note 9 “Debt Obligations” to our consolidated financial statements for further information on our debt instruments.
(2) The table above excludes cash to be paid for income taxes, $14.7 million of total contingent earn-out liabilities related to certain acquisitions as of December 27, 2019 and approximately $5.3 million of lease payments related to long-term leases for several vehicles and a distribution and processing facility that do not commence until fiscal 2020.
We had outstanding letters of credit of approximately $16.6 million and $15.8 million at December 27, 2019 and December 28, 2018, respectively. Substantially all of our assets are pledged as collateral to secure our borrowings under our credit facilities.

                               |          |                    | Payments Due by Period (1, 2) |           |
------------------------------ | -------- | ------------------ | ----------------------------- | --------- | ----------
                               | Total    | Less than One Year | 1-3 Years                     | 4-5 Years | Thereafter
                               |          |                    | (In thousands)                |           |
Inventory purchase commitments | $53,413  | $53,413            | $—                            | $—        | $—
Indebtedness                   | $406,644 | $2,993             | $244,151                      | $159,500  | $—
Finance lease obligations      | $4,597   | $880               | $1,715                        | $1,392    | $610
Pension exit liabilities       | $2,169   | $149               | $329                          | $375      | $1,316
Long-term operating leases     | $197,359 | $25,662            | $43,130                       | $30,080   | $98,487
Total                          | $664,182 | $83,097            | $289,325                      | $191,347  | $100,413

Commitments Obligations
 table summarizes contractual obligations commercial commitments December 27, 2019
 Interest debt instruments included except Term Loan ABL floating interest rates. borrowings $238. 1 million Term Loan zero ABL. interest rate Term Loan 5. 8% expense $13. 9 million. ABL 3. 7% expense $1. 6 million. Note 9 “Debt.
 excludes cash income taxes $14. 7 million contingent earn-out liabilities acquisitions $5. 3 million lease payments long-term leases distribution processing facility 2020.
 letters of credit $16. 6 million $15. 8 million at December 27, 2019 28, 2018. assets pledged collateral borrowings.
 Payments Due Period
 Less than One Year 1-3 Years 4-5 Years
 Inventory purchase commitments $53,413
 Indebtedness $406,644 $2 $244,151 $159,500
lease obligations $4,597 $1,392
 Pension liabilities,169
 Long-term leases $197,359 $25,662,130 $30,080
 $664,182 $83,097,325 $191,347


Operating Expenses
Operating expenses increased to approximately $19.1 million for the year ended December 31, 2019, from approximately $12.0 million for the year ended December 31, 2018, an increase of approximately 60%. The detail by major category is reflected in the table below.
The main drivers for the overall increase in operating expenses in 2019 was our focus on staffing and scaling our company to foster, and be able to support, accelerated revenue growth.
Within the operating expenses, there were a variety of increases, the largest of which was in salaries, wages and benefits, as a result of additional staff added in 2018 and 2019, including related benefits. During 2019, we hired a chief commercial officer, a chief technology officer, five new salespeople, a human resources manager, as well as other administrative positions. We also added 14 employees as a result of our RMDY acquisition in October 2019. During 2018, we added to our staff in several key areas, including a head of data analytics, an additional VP of sales, and a controller. We also added 10 employees in late 2018 as a result of our CareSpeak acquisition. The full year impact of these 2018 hires also increased payroll expense in 2019. We expect our compensation expense to increase in 2020, but at a much lower rate than in 2019.
Professional fees increased primarily because of costs associated with our uplisting to Nasdaq and the completion of the underwritten offering, as well as ongoing compliance with Sarbanes Oxley. We also switched auditors in 2019, which resulted in higher audit fees.
Acquisition costs are related to our acquisitions of RMDY Health in 2019 and CareSpeak Communications in October 2018. These costs include investment banker fees, legal and accounting due diligence, audit costs associated with CareSpeak, valuation experts for the purchase price allocation, and other miscellaneous costs. Since RMDY Health was a larger company than CareSpeak Communications, the costs associated with the acquisition were higher.
Board compensation decreased slightly from 2018 to 2019 as we had five independent directors for a portion of 2018, as opposed to the four that we had in 2019.
The cost of consultants increased from 2018 to 2019. The primary reason for the increase was related to consultants used for quality certifications, as well as for marketing activities.
Our advertising and promotion costs increased significantly from 2018 to 2019 as a result of increased marketing activities. This included increased attendance and sponsorship at conferences, rebranding, and other marketing activities.
Expenses related to research, development, management, and maintenance of our technology increased in 2019 primarily as a result of research into potential new product areas.
Integration incentives, which are fees paid to accelerate access to new partners, increased in 2019, as we launched with a greater number of new EHRs in 2019 than in 2018.
Depreciation and amortization increased significantly in 2019 from the 2018 levels. The increased amortization resulting from the acquisition of CareSpeak and the resulting intangible assets were amortized for a full year in 2019 as opposed to only the fourth quarter of 2018. We also had three months of amortization related to the intangible assets acquired as part of the acquisition of RMDY in October 2019. We expect depreciation and amortization expense in 2020 to increase over 2019 levels due to the full year of amortization of RMDY intangibles.
Office, facility, and other costs increased from 2018 to 2019. The main reason for the change related to a higher level of activity with more employees and increased expenses resulting from the RMDY acquisition.
Stock based compensation decreased by approximately $260,000 from $2.5 million in 2018 to $2.3 million in 2019 primarily because performance-based awards granted in 2018 vested, whereas performance-based awards granted in 2019 did not vest because we did not meet the stretch goals required for vesting.

                                         | Years Ended December 31 |
---------------------------------------- | ----------------------- | -----------
                                         | 2019                    | 2018
Salaries, Wages and Benefits             | $8,471,278              | $5,823,057
Professional Fees                        | 850,086                 | 362,678
Acquisition Related Costs                | 799,623                 | 607,670
Board Compensation                       | 137,000                 | 144,125
Investor Relations                       | 105,639                 | 113,059
Consultants                              | 245,386                 | 167,694
Advertising and Promotion                | 709,006                 | 299,955
Depreciation and Amortization            | 1,282,786               | 316,502
Research, Development, and Maintenance   | 2,672,406               | 675,660
Integration Incentives                   | 208,855                 | 132,500
Office, Facility and Other               | 695,493                 | 472,250
Travel                                   | 695,283                 | 390,563
   Subtotal                              | 16,872,841              | 9,505,713
Stock-based Compensation                 | 2,260,298               | 2,520,852
Total Operating Expense                  | $19,133,139             | $12,026,565

Operating Expenses
 increased $19. 1 million December 31, 2019 from $12. 0 million 2018 60%. table.
 focus staffing scaling accelerated revenue growth.
 increases largest salaries wages benefits additional staff 2018 2019. 2019 hired chief commercial officer technology officer five salespeople human resources manager administrative positions. added 14 employees RMDY acquisition 2019. 2018 added staff head data analytics sales controller. added 10 employees CareSpeak acquisition. increased payroll expense 2019. compensation expense increase 2020 lower than 2019.
 Professional fees increased uplisting Nasdaq underwritten offering compliance Sarbanes Oxley. switched auditors 2019 higher audit fees.
 Acquisition costs RMDY Health 2019 CareSpeak Communications. include investment banker fees legal accounting due diligence audit costs valuation miscellaneous costs. RMDY Health costs higher.
 Board compensation decreased 2018 to 2019 five independent directors.
 cost consultants increased 2018 to 2019. quality certifications marketing activities.
 advertising promotion costs increased 2018 2019 marketing activities. attendance rebranding.
 Expenses research development maintenance technology increased.
 Integration incentives increased.
 Depreciation amortization increased. acquisition CareSpeak intangible assets amortized full. three months amortization assets RMDY 2019. expect depreciation amortization 2020 increase amortization RMDY intangibles.
 Office facility costs increased 2018 to 2019. higher activity more employees increased expenses RMDY acquisition.
 Stock based compensation decreased $260,000 $2. 5 million 2018 to $2. 3 million 2019 performance-based awards.
 December 31
 Salaries Wages Benefits $8,471,278 $5,823,057
 Professional Fees 850,086 362,678
 Acquisition Related Costs 799,623 607,670
 Board Compensation 137,000 144,125
 Investor Relations 105,639
 Consultants 245,386
 Advertising Promotion 709,006 299,955
 Depreciation Amortization 1,282,786 316,502
2,672,406,660
 Incentives 208,855 132
,493,250
 390,563
,872,841 9,505,713
 Compensation 2,260,298 2,520,852
 Expense,133,139,565


Contractual obligations
As of December 31, 2019, our contractual obligations were:
(1) See "9. Leases" in Item 8 of this Annual Report for additional information.
(2) Represents the fixed or minimum amounts due under purchase obligations for hosting services and sales and marketing programs
(3) We are unable to reasonably estimate the timing of the cash outflow due to uncertainties in the timing of the effective settlement of tax positions.
(4) Represents the maximum funding that would be expected under existing investment agreements with privately-held companies. Our investment agreements generally allow us to withhold unpaid committed funds at our discretion.
A detailed discussion and analysis of the fiscal year 2017 year-over-year changes can be found in Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations of our Annual Report on Form 10-K for the year ended December 31, 2018.

                                          |         |             | Payments due by period |                     |        |
----------------------------------------- | ------- | ----------- | ---------------------- | ------------------- | ------ | --------
(in thousands)                            | 2020    | 2021 - 2022 | 2023 - 2024            | 2025 and thereafter | Other  | Total
Operating lease obligations (1)           | 19,373  | 36,373      | 19,683                 | 1,666               | -      | $77,095
Purchase obligations (2)                  | $24,800 | $8,129      | $438                   | $ -                 | $ -    | $33,367
Liability for uncertain tax positions (3) | -       | -           | -                      | -                   | 5,386  | $5,386
Investment commitments (4)                | 1,754   | 205         | -                      | -                   | -      | $1,959
Total                                     | $45,927 | $44,707     | $20,121                | $1,666              | $5,386 | $117,807

Contractual obligations
 December 31, 2019
 See. Leases Item 8 Annual Report.
 amounts purchase obligations services sales marketing programs
 estimate cash outflow settlement tax positions.
 maximum funding investment agreements privately-held companies. agreements withhold unpaid funds.
 fiscal year 2017 changes Item 7. Financial Condition Results Operations Annual Report Form 10-K December 31, 2018.
 Payments due period
 thousands 2020 2021 2022 2023 - 2024 2025
 Operating lease obligations 19,373 $77,095
 Purchase obligations (2) $24,800  $8,129 $33,367
 Liability uncertain tax positions 5,386 $5,386
 Investment commitments (4) 1,754 205 $1,959
 $45,927 $44,707 $20,121 $5


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except for share and per share data)
Our pension plan asset allocation at December 31, 2019, and 2018, and target allocation for 2020 by asset category are as follows:
We employ a liability-driven investment strategy whereby a mix of equity and fixed-income investments are used to pursue a derisking strategy which over time seeks to reduce interest rate mismatch risk and other risks while achieving a return that matches or exceeds the growth in projected pension plan liabilities. Risk tolerance is established through careful consideration of plan liabilities and funded status. The investment portfolio primarily contains a diversified mix of equity and fixed-income investments. Other assets such as private equity are used modestly to enhance long-term returns while improving portfolio diversification. Investment risk is measured and monitored on an ongoing basis through quarterly investment portfolio reviews, annual liability measurements, and asset/liability studies at regular intervals.

                  | Target Allocations | Percentage of Plan Assets at December 31, |
----------------- | ------------------ | ----------------------------------------- | ----
Asset Category    | 2020               | 2019                                      | 2018
Equity securities | 13%                | 13%                                       | 12%
Debt securities   | 83%                | 83%                                       | 84%
Other             | 4%                 | 4%                                        | 4%
Total             | 100%               | 100%                                      | 100%

FINANCIAL STATEMENTS thousands share data
 pension plan asset allocation December 31, 2019 2018 target allocation 2020
 liability-driven investment strategy mix equity fixed-income investments derisking interest rate mismatch return liabilities. Risk tolerance plan liabilities funded status. investment portfolio diversified equity fixed-income. private equity returns portfolio diversification. risk monitored quarterly reviews annual liability measurements asset/liability studies.
 Target Allocations Percentage Plan Assets December 31,
 Asset Category 2020 2019
 Equity securities 13%
 Debt securities 83%
 Other 4%
 Total 100%