american tower corporation subsidiaries notes consolidated financial statements 2014 basis step-up from corporate restructuring represents tax effects of increasing basis for tax purposes of certain company 2019s assets with spin-off from american radio systems corporation former parent company.
 december 31 , 2006  company had net federal state operating loss carryforwards available to reduce future taxable income of approximately $ 2. 1 billion and $ 2. 5 billion  respectively.
 if not utilized company 2019s net operating loss carryforwards expire in thousands ) :.
.
 201caccounting for income taxes , 201d requires companies record valuation allowance when likely some portion or all deferred tax assets not be realized. at december 31, 2006  company provided valuation allowance of approximately $ 308. 2 million  including approximately $ 153. 6 million attributable to spectrasite  primarily related to net operating loss and capital loss carryforwards assumed as of acquisition date.
 balance of valuation allowance relates to net state deferred tax assets.
 company not provided valuation allowance for remaining deferred tax assets primarily federal net operating loss carryforwards management believes company sufficient time to realize federal net operating loss carryforwards during twenty-year tax carryforward period.
 valuation allowances may be reversed if related deferred tax assets deemed realizable based on changes in facts circumstances relevant assets 2019 recoverability.
 approximately $ 148. 3 million of spectrasite valuation allowances as of december 31 , 2006 be recorded as reduction to goodwill if underlying deferred tax assets utilized.
 company intends to recover portion of deferred tax asset through federal income tax refund claims related to carry back of certain federal net operating losses.
june 2003 and october 2003 , company filed federal income tax refund claims with irs relating to carry back of $ 380. 0 million of net operating losses generated prior to 2003 , company initially anticipated receiving approximately $ 90. 0 million.
 based on preliminary discussions with tax authorities company revised estimate of net realizable value of federal income tax refund claims during year ended december 31 , 2005 , anticipates receiving refund of approximately $ 65. 0 million , plus interest.
 company expects settlement matter in first half of 2007 , no assurances with to timing of refund.
 uncertainty associated with claim  company not recognized amounts related to interest.
 recoverability of company 2019s remaining net deferred tax asset assessed utilizing stable state ( no growth ) projections based on current operations.
 projections show significant decrease in depreciation in later years of carryforward period result of significant portion of assets fully depreciated during first fifteen years of carryforward period.
 recoverability of net deferred tax asset not dependent on material improvements to operations , material asset sales or other non-routine transactions.
 based on current outlook of future taxable income during carryforward period  management believes net deferred tax asset will be realized.
 realization of company 2019s deferred tax assets as of december 31 , 2006 dependent upon ability to generate approximately $ 1. 4 billion in taxable income from january 1 , 2007 to december 31 , 2026.
 if company unable to generate sufficient taxable income in future , or carry back losses  described

years ended december 31, | federal   | state
------------------------ | --------- | ---------
2007 to 2011             |           | $ 438967
2012 to 2016             |           | 478502
2017 to 2021             | $ 617039  | 1001789
2022 to 2026             | 1476644   | 629354
total                    | $ 2093683 | $ 2548612


table of contents adobe inc.
 notes to consolidated financial statements ( continued ) goodwill , purchased intangibles other long-lived assets goodwill assigned to one or more reporting segments on date of acquisition.
 we review goodwill for impairment annually during second quarter of each fiscal year between annual tests if event occurs or circumstances change more likely not reduce fair value of reporting units below respective carrying amount.
 in performing goodwill impairment test  we first perform qualitative assessment consider events or circumstances including macroeconomic conditions  industry and market considerations  cost factors  overall financial performance  changes in management or key personnel  changes in strategy  changes in customers  changes in composition or carrying amount of reporting segment 2019s net assets changes in stock price.
 if after assessing totality of events or circumstances determine more likely than not fair values of reporting segments are greater than carrying amounts , then quantitative goodwill impairment test not performed.
 if qualitative assessment indicates quantitative analysis should be performed , we then evaluate goodwill for impairment by comparing fair value of each reporting segments to carrying value  including associated goodwill.
 to determine fair values  use equal weighting of market approach based on comparable publicly traded companies in similar lines of businesses income approach based on estimated discounted future cash flows.
 cash flow assumptions consider historical and forecasted revenue , operating costs other relevant factors.
 completed annual goodwill impairment test in second quarter of fiscal 2018.
 determined after qualitative review of each reporting segment more likely than not that fair value of each reporting segments substantially exceeds respective carrying amounts.
 accordingly no indication of impairment quantitative goodwill impairment test not performed.
not identify events or changes in circumstances since annual goodwill impairment test require to perform another goodwill impairment test during fiscal year.
 we amortize intangible assets with finite lives over estimated useful lives review them for impairment whenever impairment indicator exists.
 continually monitor events and changes in circumstances could indicate carrying amounts of long-lived assets including intangible assets may not be recoverable.
 when such events changes circumstances occur assess recoverability by determining whether carrying value of assets be recovered through undiscounted expected future cash flows.
 if future undiscounted cash flows less than carrying amount of assets, recognize impairment loss based on excess of carrying amount over fair value of assets.
 not recognize intangible asset impairment charges in fiscal 2018 , 2017 or 2016.
 during fiscal 2018  intangible assets were amortized over estimated useful lives ranging from 1 to 14 years.
 amortization based on pattern in economic benefits of intangible asset consumed or on straight-line basis when consumption pattern not apparent.
 weighted average useful lives of intangible assets were as follows : weighted average useful life ( years ).
 income taxes use asset and liability method of accounting for income taxes.
 under method income tax expense recognized for amount of taxes payable or refundable for current year.
 deferred tax assets and liabilities recognized for expected future tax consequences of temporary differences between financial reporting and tax bases of assets and liabilities for operating losses and tax credit carryforwards.
 record valuation allowance to reduce deferred tax assets to amount for realization more likely than not.

| weighted averageuseful life ( years )
------------------------------------ | -------------------------------------
purchased technology                 | 6
customer contracts and relationships | 9
trademarks                           | 9
acquired rights to use technology    | 10
backlog                              | 2
other intangibles                    | 4


2322 t.
 r o w e p r i c e g r o u p a n n u a l r e p o r t 2 0 1 1 c o n t r a c t u a l o b l i g at i o n s table presents summary of future obligations ( in a0millions ) under terms existing operating leases and other contractual cash purchase commitments at december 31 , 2011.
 other purchase commitments include contractual amounts due for purchase of goods or services used in our operations may be cancelable at earlier times  under certain conditions may involve termination fees.
 obligations are generally of normal recurring nature  expect we will fund them from future cash flows from operations.
 information not include operating expenses or capital expenditures committed in normal course of operations in 2012 and future years.
 information excludes $ 4. 7 a0million of uncertain tax positions discussed in note 9 to consolidated financial statements not possible to estimate time period payment might be made to tax authorities.
 have outstanding commitments to fund additional contributions to investment partnerships in existing investment totaling $ 42. 5 a0million at december 31 , 2011.
 c r i t i l a o n t n g p o l i preparation of financial statements requires selection of specific accounting methods and policies from several acceptable alternatives.
 significant estimates and judgments may be required in selecting and applying those methods and policies in recognition of assets and liabilities in balance sheet , revenues and expenses in statement of income  information in significant accounting policies and notes to consolidated financial statements.
 making these estimates and judgments requires analysis of information concerning events not be complete and facts and circumstances may change over time.
accordingly actual amounts or future results can differ from estimates in our consolidated financial statements , significant accounting policies  notes.
 we present significant accounting policies used in preparation our consolidated financial statements as integral part of statements within this 2011 annual report.
 in following discussion  we highlight and explain certain policies critical to preparation understanding of our financial statements.
 other than temporary impairments of available-for-sale securities.
 we classify our investment holdings in sponsored mutual funds and debt securities held for investment by our savings bank subsidiary as available-for-sale.
 at end of each quarter  we mark carrying amount of each investment holding to fair value recognize unrealized gain or loss as component of comprehensive income within statement of stockholders 2019 equity.
 we next review each individual security position has unrealized loss or impairment to determine if impairment is other than temporary.
 in determining mutual fund holding other than temporarily impaired  we consider many factors including duration of time existed severity of impairment  subsequent changes in value  our intent and ability to hold security for period time sufficient for anticipated recovery in fair value.
 subject to other considerations with to duration of time we believe a mutual fund holding with unrealized loss persisted daily throughout six months between quarter-ends is generally presumed to have other than temporary impairment.
 we may also recognize other than temporary loss of less than six months in our statement of income if circumstances of underlying investment do not warrant belief near-term recovery possible.
impaired debt security held by our savings bank subsidiary is considered other than temporary loss we recognize in our statement of income if impairment caused by change in credit quality affects our ability to recover amortized cost or if we intend to sell security or believe more likely not required to sell security before recovering cost.
 minor impairments of 5% ( 5 % ) or less are generally considered temporary.
 other than temporary impairments of equity method investments.
 we evaluate our equity method investments  including our investment in uti , for impairment when events or changes in circumstances indicate carrying value of investment exceeds fair value decline in fair value is other than temporary.
 goodwill.
 we internally conduct  manage and report our operations as one investment advisory business.
 not distinct operating segments or components business.
 attribute goodwill to single reportable business segment and reporting unit 2014our investment advisory business.
 evaluate carrying amount of goodwill in balance sheet for possible impairment on annual basis in third quarter of each year using fair value approach.
 goodwill considered impaired whenever our historical carrying amount exceeds fair value of our investment advisory business.
 annual testing demonstrated fair value of our investment advisory business ( market capitalization ) exceeds our carrying amount ( stockholders 2019 equity ) and no impairment exists.
 should reach different conclusion in future additional work performed to ascertain amount of non-cash impairment charge to recognized.
 must perform impairment testing at other times if event or circumstance occurs indicating more likely than not impairment incurred.
 maximum future impairment of goodwill we could incur is amount recognized in our balance sheet , $ 665. 7 a0million.
 stock options.
recognize stock option-based compensation expense in consolidated statement of income using fair value based method.
 fair value methods use valuation model for shorter-term, market-traded financial instruments to theoretically value stock option grants even though not available for trading of longer duration.
 black- scholes option-pricing model includes input of certain variables dependent on future expectations including expected lives of options from grant date to exercise date , volatility of underlying common shares in market over time period  rate of dividends we will pay during time.
 estimates of these variables made for purpose of using valuation model to determine expense for each reporting period not subsequently adjusted.
 unlike most of expenses resulting charge to earnings using fair value based method is non-cash charge never measured by  or adjusted based on cash outflow.
 provision for income taxes.
 after compensation and related costs provision for income taxes on our earnings is our largest annual expense.
 operate in numerous states and countries through various subsidiaries must allocate income , expenses  and earnings under laws and regulations of each of these taxing jurisdictions.
 provision for income taxes represents total estimate of liability we incurred in doing business each year in all locations.
 annually  file tax returns represent our filing positions with each jurisdiction and settle return liabilities.
 each jurisdiction has right to audit those returns may take different positions with respect to income and expense allocations and taxable earnings determinations.
 from time to time may also provide for estimated liabilities associated with uncertain tax return filing positions subject to or in process of being audited by various tax authorities.
 because determination of our annual provision subject to judgments and estimates likely actual results will vary from those recognized in financial statements.
result , we recognize additions to or reductions of income tax expense during reporting period pertain to prior period provisions as estimated liabilities revised actual tax returns tax audits settled.
 recognize any such prior period adjustment in discrete quarterly period in it determined.
 n e w ly s d b u t n o t y e t a d o p t e d a c c o u n t i n g g u i d a n c e in may 2011 , fasb issued amended guidance clarifying to measure and disclose fair value.
 do not believe adoption of such amended guidance on january 1, 2012 , have significant effect on consolidated financial statements.
 considered all other newly issued accounting guidance applicable to our operations preparation of consolidated statements  including not yet adopted.
 do not believe any such guidance material effect on our financial position or results of operation.

| total | 2012  | 2013-14 | 2015-16 | later
------------------------------ | ----- | ----- | ------- | ------- | -----
noncancelable operating leases | $ 185 | $ 31  | $ 63    | $ 57    | $ 34
other purchase commitments     | 160   | 112   | 38      | 10      | -
total                          | $ 345 | $ 143 | $ 101   | $ 67    | $ 34


fair value of financial instruments : company 2019s financial instruments include cash cash equivalents  marketable securities  accounts receivable  certain investments  accounts payable  borrowings  derivative contracts.
 fair values of cash cash equivalents  accounts receivable  accounts payable short-term borrowings current portion of long-term debt approximated carrying values short-term nature instruments.
 available-for-sale marketable securities investments  certain derivative instruments recorded at fair values as indicated in preceding disclosures.
 for long-term debt company utilized third-party quotes to estimate fair values ( classified as level 2 ).
 information carrying amounts estimated fair values of financial instruments follow:.
 fair values reflected above consider terms of related debt absent impacts of derivative/hedging activity.
 carrying amount of long-term debt impacted by certain fixed-to-floating interest rate swaps designated as fair value hedges designation of fixed rate eurobond securities issued company as hedging instruments of company 2019s net investment in european subsidiaries.
 3m 2019s fixed-rate bonds were trading at premium at december 31 , 2012 and 2011 due to low interest rates tightening of 3m 2019s credit spreads.

( millions )                             | december 31 2012 carrying value | december 31 2012 fair value | december 31 2012 carrying value | fair value
---------------------------------------- | ------------------------------- | --------------------------- | ------------------------------- | ----------
long-term debt excluding current portion | $ 4916                          | $ 5363                      | $ 4484                          | $ 5002


f0b7 free cash flow 2013 cash generated by operating activities totaled $ 6. 2 billion reduced by $ 3. 6 billion for cash used in investing activities 37% ( 37 % ) increase in dividends paid yielding free cash flow of $ 1. 4 billion.
 free cash flow defined as cash provided by operating activities ( adjusted for reclassification of receivables securitization facility ) less cash used in investing activities dividends paid.
 free cash flow not a financial measure under accounting principles accepted in u.
 gaap ) by sec regulation g item 10 of sec regulation s-k may not be defined calculated by other companies same.
 free cash flow important to management investors in evaluating financial performance measures ability to generate cash without additional external financings.
 free cash flow should be considered in addition to than substitute for cash provided by operating activities.
 table reconciles cash provided by operating activities ( gaap measure ) to free cash flow ( non-gaap measure ) : millions 2012 2011 2010.
 effective january 1 , 2010 new accounting standard required to account for receivables transferred under receivables securitization facility as secured borrowings in consolidated statements of financial position as financing activities in consolidated statements of cash flows.
 receivables securitization facility included in free cash flow calculation to adjust cash provided by operating activities as though receivables securitization facility accounted for under new accounting standard for all periods.
 2013 outlook f0b7 safety 2013 operating safe railroad benefits employees customers shareholders communities we serve.
 continue using multi-faceted approach to safety  utilizing technology  risk assessment quality control training employee engagement targeted capital investments.
 continue using expanding deployment of total safety culture throughout operations identify implement best practices for employee operational safety.
derailment prevention reduction of grade crossing incidents critical aspects of our safety programs.
 continue efforts to increase rail defect detection ; improve close crossings educate public law enforcement agencies about crossing safety through combination our own programs ( including risk assessment strategies ) industry programs local community activities across network.
 f0b7 network operations 2013 continue focusing on six critical initiatives to improve safety  service productivity during 2013.
 seeing solid contributions from reducing variability  continuous improvements standard work.
 resource agility allows to respond quickly to changing market conditions network disruptions from weather other events.
 railroad benefit from capital investments build capacity for growth harden infrastructure to reduce failure.
 f0b7 fuel prices 2013 uncertainty about economy makes projections of fuel prices difficult.
 could see volatile fuel prices during year  sensitive to global u.
 domestic demand refining capacity geopolitical events weather conditions other factors.
 to reduce impact of fuel price on earnings  continue seeking cost recovery from customers through fuel surcharge programs expanding fuel conservation efforts.
 f0b7 capital plan 2013 in 2013 plan to make total capital investments of approximately $ 3. 6 billion , including expenditures for positive train control ( ptc ) may be revised if business conditions warrant or if new laws or regulations affect ability generate sufficient returns on investments.
 ( see further discussion in item 7 under liquidity and capital resources 2013 capital plan. )

millions                                                                                | 2012           | 2011           | 2010
----------------------------------------------------------------------------------------- | -------------- | -------------- | --------------
cash provided by operating activities                                                     | $ 6161         | $ 5873         | $ 4105
receivables securitization facility [a]                                                   | -              | -              | 400
cash provided by operating activities adjusted for the receivables securitizationfacility | 6161           | 5873           | 4505
cash used in investing activities                                                         | -3633 ( 3633 ) | -3119 ( 3119 ) | -2488 ( 2488 )
dividends paid                                                                            | -1146 ( 1146 ) | -837 ( 837 )   | -602 ( 602 )
free cash flow                                                                            | $ 1382         | $ 1917         | $ 1415


except for long-term debt carrying amounts of company 2019s other financial instruments measured at fair value or approximate fair value due to short-term nature instruments.
 asset retirement obligations 2014the company records all known asset retirement obligations within other current liabilities for which liability 2019s fair value can be reasonably estimated including certain asbestos removal  asset decommissioning contractual lease restoration obligations.
 changes in asset retirement obligation carrying amounts during 2011 , 2010 2009 were as follows : ( $ in millions ) retirement obligations.
 company also has known conditional asset retirement obligations related to assets currently in use certain asbestos remediation asset decommissioning activities to in future not reasonably estimable as of december 31 , 2011 and 2010  due to insufficient information about timing method of settlement obligation.
 fair value of these obligations not recorded in consolidated financial statements.
 environmental remediation/or asset decommissioning of relevant facilities may be required when company ceases to utilize these facilities.
 may be conditional environmental asset retirement obligations company not yet discovered.
 income taxes 2014income tax expense other income tax related information in financial statements for periods before spin-off presented as if company filed its own tax returns stand-alone similar information for periods after spin-off reflect company 2019s positions to be filed in own tax returns in future.
 income tax expense other related information based on prevailing statutory rates for.
 federal income taxes and composite state income tax rate for company for each period.
 state and local income and franchise tax provisions allocable to contracts in process included in general and administrative expenses.
deferred income taxes recorded when revenues and expenses recognized in different periods for financial statement purposes than tax return purposes.
 deferred tax asset or liability account balances calculated at balance sheet date using current tax laws and rates.
 determinations of expected realizability of deferred tax assets and need for valuation allowances against tax assets evaluated based stand-alone tax attributes of company $ 18 million valuation allowance deemed necessary as of december 31 , 2011.
 no valuation allowance necessary as of december 31 , 2010.
 uncertain tax positions meeting more-likely-than-not recognition threshold based on merits position recognized in financial statements.
 recognize amount of tax benefit greater than 50% ( 50 % ) likely to be realized upon ultimate settlement with related tax authority.
 if tax position not meet minimum statutory threshold to avoid payment of penalties recognize expense for amount of penalty in period tax position claimed or expected to be claimed in tax return.
 penalties  if probable reasonably estimable recognized as component of income tax expense.
 recognize accrued interest related to uncertain tax positions in income tax expense.
 timing and amount of accrued interest determined by applicable tax law associated with underpayment of income taxes.
 see note 12 : income taxes.
 under existing gaap changes in accruals associated with uncertainties recorded in earnings in period they determined.

( $ in millions )                                          | asset retirement obligations
---------------------------------------------------------- | ----------------------------
balance at january 1 2009                                  | $ 3
accretion expense                                          | 0
payment of asset retirement obligation                     | 0
balance at december 31 2009                                | 3
obligation relating to the future retirement of a facility | 17
accretion expense                                          | 0
payment of asset retirement obligation                     | 0
balance at december 31 2010                                | 20
obligation relating to the future retirement of a facility | 5
accretion expense                                          | 0
payment of asset retirement obligation                     | 0
balance at december 31 2011                                | $ 25


( $ 66 million net-of-tax ) result of customer credits realized by electric customers of entergy louisiana  consistent with terms stipulated settlement in business combination proceeding.
 see note 2 to financial statements for discussion of business combination and customer credits.
 results of operations for 2015 include sale in december 2015 of 583 mw rhode island state energy center for realized gain of $ 154 million ( $ 100 million net-of-tax ) on sale $ 77 million ( $ 47 million net-of-tax ) write-off and regulatory charges recognize portion of assets associated with waterford 3 replacement steam generator project no longer probable of recovery.
 see note 14 to financial statements for discussion rhode island state energy center sale.
 see note 2 financial statements for discussion waterford 3 replacement steam generator review.
 net revenue utility analysis of change in net revenue comparing 2016 to 2015.
 amount ( in millions ).
 retail electric price variance due to 2022 increase in base rates at entergy arkansas  approved by apsc.
 new rates effective february 24, 2016 began billing with first billing cycle of april 2016.
 increase included interim base rate adjustment surcharge  effective with first billing cycle of april 2016 to recover incremental revenue requirement for period february 24 , 2016 through march 31 , 2016.
significant portion increase related to purchase of power block 2 of union power station ; 2022 increase in purchased power and capacity acquisition cost recovery rider for entergy new orleans  approved by city council  effective with first billing cycle march 2016  primarily related to purchase of power block 1 union power station ; 2022 increase in formula rate plan revenues for entergy louisiana  implemented with first billing cycle march 2016  collect estimated first-year revenue requirement related to purchase of power blocks 3 and 4 union power station ; 2022 increase in revenues at entergy mississippi  approved by mpsc  effective with first billing cycle of july 2016  increase in revenues collected through storm damage rider.
 see note 2 to financial statements for discussion rate proceedings.
 see note 14 financial statements for discussion union power station purchase.
 louisiana business combination customer credits variance due to regulatory liability of $ 107 million recorded by entergy in october 2015 result entergy gulf states louisiana and entergy louisiana business combination.
 consistent with terms stipulated settlement business combination proceeding electric customers of entergy louisiana will realize customer credits associated with business combination ; in october 2015  entergy recorded regulatory liability of $ 107 million ( $ 66 million net-of-tax ).
 costs entergy corporation and subsidiaries management 2019s financial discussion and analysis

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


shares of common stock issued , in treasury  outstanding were ( in thousands of shares ) :.
 note 13.
 financing arrangements routinely enter into accounts receivable securitization and factoring programs.
 account for transfers of receivables these programs as sale remove them from consolidated balance sheet.
 at december 31 , 2016  most significant program was u. s.
 securitization program  amended in may 2016 originally entered into in october of 2015.
 under program entitled to receive cash consideration of up to $ 800 million ( elected to reduce to $ 500 million effective february 21, 2017 ) and receivable for remainder of purchase price ( 201cdeferred purchase price 201d ).
 securitization program utilizes bankruptcy- remote special-purpose entity ( 201cspe 201d ).
 spe wholly-owned by subsidiary of kraft heinz sole business of purchase or acceptance  through capital contributions of receivables related assets from kraft heinz subsidiary subsequent transfer of such receivables related assets to bank.
 spe included in consolidated financial statements separate legal entity with separate creditors entitled upon liquidation to be satisfied out of spe's assets prior to any assets or value in spe becoming available to kraft heinz or subsidiaries.
 assets of spe not available to pay creditors of kraft heinz or subsidiaries.
 program expires in may 2017.
 in addition to u. s.
 securitization program  have accounts receivable factoring programs denominated in australian dollars , new zealand dollars  british pound sterling  euros  japanese yen.
 under these programs generally receive cash consideration up to certain limit and receivable for deferred purchase price.
 no deferred purchase price associated with japanese yen contract.
related to these programs our aggregate cash consideration limit after applying hold-backs was $ 245 million.
 dollars at december 31 , 2016.
 programs renews annually until terminated by either party.
 cash consideration and carrying amount receivables removed from consolidated balance sheets above programs were $ 904 million at december 31 , 2016 and $ 267 million at january 3 , 2016.
 fair value of deferred purchase price for programs was $ 129 million at december 31 , 2016 and $ 583 million at january 3 , 2016.
 deferred purchase price included in sold receivables on consolidated balance sheets had carrying value approximated fair value at december 31  2016 and january 3 , 2016.
 proceeds from sales recognized on consolidated statements of cash flows as component of operating activities.
 we act as servicer for arrangements not recorded servicing assets or liabilities for arrangements as of december 31 , 2016 and january 3, 2016 not material to financial statements.

| shares issued | treasury shares | shares outstanding
------------------------------------------------------------------ | ------------- | --------------- | ------------------
balance at december 29 2013                                        | 376832        | 2014            | 376832
exercise of stock options issuance of other stock awards and other | 178           | 2014            | 178
balance at december 28 2014                                        | 377010        | 2014            | 377010
exercise of warrants                                               | 20480         | 2014            | 20480
issuance of common stock to sponsors                               | 221666        | 2014            | 221666
acquisition of kraft foods group inc .                             | 592898        | 2014            | 592898
exercise of stock options issuance of other stock awards and other | 2338          | -413 ( 413 )    | 1925
balance at january 3 2016                                          | 1214392       | -413 ( 413 )    | 1213979
exercise of stock options issuance of other stock awards and other | 4555          | -2058 ( 2058 )  | 2497
balance at december 31 2016                                        | 1218947       | -2471 ( 2471 )  | 1216476


table sets forth information concerning increases in total number of our aap stores during past five years:.
 ( 1 ) not include stores opened as relocations of previously existing stores within same market area or substantial renovations of stores.
 store technology.
 our store-based information systems are comprised of proprietary integrated point of sale , electronic parts catalog  epc  store-level inventory management system ( collectively "store system" ).
 information maintained by store system is used to formulate pricing  marketing merchandising strategies replenish inventory accurately rapidly.
 our integrated system enables store team members to assist customers in parts selection and ordering based on year  make model engine type of vehicles.
 store system provides real-time inventory tracking at store level store team members to check quantity of on-hand inventory for adjust stock levels for select items for store specific events process returns and defective merchandise designate skus for cycle counts track merchandise transfers.
 if hard-to-find part or accessory not available at stores store system can determine whether part is carried in-stock through hub or pdq ae networks or can be ordered directly from vendors.
 available parts and accessories then ordered electronically from another store  hub  pdq ae or directly from vendor with immediate confirmation of price , availability estimated delivery time.
 our centrally-based epc data management system enables us to reduce time needed to exchange data with vendors catalog deliver updated accurate parts information.
 support store operations with additional proprietary systems and customer driven labor scheduling capabilities.
 all these systems integrated provide real-time  comprehensive information to store personnel resulting in improved customer service levels  team member productivity in-stock availability.
plan to start rolling out new enhanced epc in fiscal 2013 expected to simplify improve customer experience.
 among improvements is more efficient way to systematically identify add-on sales to ensure customers have need to complete automotive repair project.
 store support center merchandising.
 purchasing for virtually all merchandise for stores handled by merchandise teams located in three primary locations : 2022 store support center in roanoke , virginia ; 2022 regional office in minneapolis , minnesota ; 2022 global sourcing office in taipei , taiwan.
 roanoke team responsible for parts categories minnesota team responsible for accessories , oil chemicals.
 global sourcing team works closely with both teams.
 in fiscal 2012  purchased merchandise from approximately 450 vendors  no single vendor accounting for more than 9% ( 9 % ) of purchases.
 purchasing strategy involves negotiating agreements with most vendors to purchase merchandise over specified period of time with other terms  including pricing , payment terms volume.
 merchandising team developed strong vendor relationships industry collaborative effort with vendor partners utilizes category management process manage mix of product offerings to meet customer demand.
 believe this process  develops customer-focused business plan for each merchandise category  global sourcing operation critical to improving comparable store sales , gross margin inventory productivity.

| 2012 | 2011     | 2010     | 2009       | 2008
---------------- | ---- | -------- | -------- | ---------- | ----------
beginning stores | 3460 | 3369     | 3264     | 3243       | 3153
new stores ( 1 ) | 116  | 95       | 110      | 75         | 109
stores closed    | 2014 | -4 ( 4 ) | -5 ( 5 ) | -54 ( 54 ) | -19 ( 19 )
ending stores    | 3576 | 3460     | 3369     | 3264       | 3243


changes to regulatory capital requirements under basel iii capital standards.
 beginning in 2014 other comprehensive income related to available for sale securities ( pension and post-retirement plans ) included in pnc 2019s regulatory capital subject to phase-in schedule ) will affect pnc 2019s regulatory capital ratios.
 for additional information see supervision and regulation section in item 1 2013 business and capital portion of balance sheet review section in item 7 of report.
 duration of investment securities was 2. 9 years at december 31 , 2013.
 estimate at december 31, 2013 effective duration of investment securities was 3. 0 years for immediate 50 basis points parallel increase in interest rates and 2. 8 years for immediate 50 basis points parallel decrease in interest rates.
 comparable amounts at december 31 , 2012 were 2. 3 years and 2. 2 years .
 conduct quarterly comprehensive security-level impairment assessment on all securities.
 for securities in unrealized loss position determine whether loss represents otti.
 for debt securities neither intend to sell nor believe required to sell prior to expected recovery recognize credit portion of otti charges in current earnings include noncredit portion of otti in net unrealized gains ( losses ) on otti securities on consolidated statement of comprehensive income and net of tax in accumulated other comprehensive income ( loss ) on consolidated balance sheet.
 during 2013 and 2012 recognized otti credit losses of $ 16 million and $ 111 million.
 all credit losses related to residential mortgage-backed and asset-backed securities collateralized by non-agency residential loans.
 if current housing and economic conditions deteriorate market volatility and illiquidity deteriorate market interest rates increase or credit spreads widen valuation of investment securities portfolio could be adversely affected could incur additional otti credit losses impact consolidated income statement.
information investment securities included in note 8 note 9 fair value in notes to consolidated financial statements item 8 report.
 loans held for sale table 15 : loans in millions december 31.
 for commercial mortgages for sale at fair value stopped originating continue pursue opportunities to reduce positions.
 at december 31 , 2013 balance loans was $ 586 million compared to $ 772 million at december 31 2012.
 for commercial mortgages for sale at lower of cost or fair value sold $ 2. 8 billion in 2013 compared to $ 2. 2 billion in 2012.
 loan sales to government agencies.
 total gains of $ 79 million recognized on valuation and sale of commercial mortgage loans net of hedges in 2013 $ 41 million in 2012.
 residential mortgage loan origination volume was $ 15. 1 billion in 2013 compared to $ 15. 2 billion in 2012.
 all loans originated under agency or federal housing administration ( fha ) standards.
 sold $ 14. 7 billion of loans recognized related gains of $ 568 million in 2013.
 comparable amounts for 2012 were $ 13. 8 billion and $ 747 million  respectively.
 interest income on loans for sale $ 157 million in 2013 and $ 168 million in 2012.
 amounts included in other interest income on consolidated income statement.
 additional information loan sale and servicing activities included in note 3 loan sales servicing activities variable interest entities note 9 fair value in notes to consolidated financial statements in item 8 report.
 goodwill and other intangible assets totaled $ 11. 3 billion at december 31 , 2013 and $ 10. 9 billion at december 31  2012.
 increase of $. 4 billion due to additions to changes in value of mortgage and other loan servicing rights.
additional information goodwill intangible assets in note 10 goodwill other intangible assets included in notes to consolidated financial statements in item 8 report.
 44 pnc financial services group , inc.
 2013 form 10-k

in millions                                          | december 312013 | december 312012
---------------------------------------------------- | --------------- | ---------------
commercial mortgages at fair value                   | $ 586           | $ 772
commercial mortgages at lower of cost or fair value  | 281             | 620
total commercial mortgages                           | 867             | 1392
residential mortgages at fair value                  | 1315            | 2096
residential mortgages at lower of cost or fair value | 41              | 124
total residential mortgages                          | 1356            | 2220
other                                                | 32              | 81
total                                                | $ 2255          | $ 3693


american tower corporation and subsidiaries notes to consolidated financial statements 2014 ) company unable to estimate impact of changes to previously recorded uncertain tax positions.
 reconciliation of beginning and ending unrecognized tax benefits for year ending december 31 , 2007 as follows ( in thousands ) :.
 during year ended december 31 , 2007  company recorded penalties and tax-related interest income of $ 2. 5 million interest income from tax refunds of $ 1. 5 million for year ended december 31 , 2007.
 as of december 31 , 2007 and january 1, 2007  total unrecognized tax benefits included in other long-term liabilities in consolidated balance sheets was $ 29. 6 million and $ 34. 3 million , respectively.
 of december 31  2007 january 1 , 2007 total accrued income tax-related interest and penalties included in other long-term liabilities in consolidated balance sheets was $ 30. 7 million and $ 33. 2 million , respectively.
 in fourth quarter of 2007  company entered tax amnesty program with mexican tax authority.
 as of december 31 , 2007  company met administrative requirements of program enabled company to recognize certain tax benefits.
 confirmed by mexican tax authority on february 5 , 2008.
 benefits include reduction of uncertain tax benefits of $ 5. 4 million penalties and interest of $ 12. 5 million related to 2002  reduced income tax expense.
 program company paid $ 6. 7 million to mexican tax authority as settlement offer for other uncertain tax positions related to 2003 and 2004.
 offer under review by mexican tax authority ; company cannot determine specific timing or amount of potential settlement.
 during 2007  statute of limitations on certain unrecognized tax benefits lapsed resulted in $ 0.7 million decrease in liability for uncertain tax benefits  reduced income tax provision.
 company files numerous consolidated and separate income tax returns , including.
 federal and state tax returns and foreign tax returns in mexico and brazil.
 result of company 2019s ability to carry forward federal and state net operating losses  applicable tax years remain open to examination until three years after applicable loss carryforwards used or expired.
 company completed.
 federal income tax examinations for tax years up to including 2002.
 company currently undergoing.
 federal income tax examinations for tax years 2004 and 2005.
 subject to examinations in various. s.
 state jurisdictions for certain tax years under examination in brazil for 2001 through 2006 tax years and mexico for 2002 tax year.
.
 109 , 201caccounting for income taxes , 201d requires companies record valuation allowance when 201cmore likely not some portion or all of deferred tax assets will not be realized. 201d at december 31, 2007, company provided valuation allowance of approximately $ 88. 2 million  including approximately

balance at january 1 2007                                     | $ 183953
------------------------------------------------------------- | ------------------
additions based on tax positions related to the current year  | 2598
additions for tax positions of prior years                    | 5412
reductions for tax positions of prior years                   | -120016 ( 120016 )
cash advance in connection with proposed settlement           | -6682 ( 6682 )
settlements with taxing authorities                           | -5372 ( 5372 )
reductions as a result of the lapse of statute of limitations | -669 ( 669 )
balance as of december 31 2007                                | $ 59224


valuation techniques 2013 cash equivalents mostly of short-term money-market instruments valued at cost approximates fair value.
.
 equity securities and international equity securities categorized as level 1 traded on active national and international exchanges valued at closing prices on last trading day of year.
 for.
 equity securities international equity securities not traded on active exchange or if closing price not available trustee obtains indicative quotes from pricing vendor  broker  or investment manager.
 securities categorized as level 2 if custodian obtains corroborated quotes from pricing vendor or categorized as level 3 if custodian obtains uncorroborated quotes from broker or investment manager.
 commingled equity funds public investment vehicles valued using net asset value ( nav ) provided by fund manager.
 nav is total value of fund divided by number of shares outstanding.
 equity funds categorized as level 1 if traded at nav on nationally recognized securities exchange or categorized as level 2 if nav corroborated by observable market data (. purchases sales activity ).
 fixed income securities categorized as level 2 valued by trustee using pricing models use verifiable observable market data (.
 interest rates yield curves ) bids provided by brokers or dealers or quoted prices of securities with similar characteristics.
 private equity funds , real estate funds  hedge funds fixed income securities categorized as level 3 valued based on valuation models include significant unobservable inputs cannot be corroborated using verifiable observable market data.
 valuations for private equity funds and real estate funds determined by general partners hedge funds valued by independent administrators.
depending on nature of assets general partners or independent administrators use income and market approaches in models.
 market approach analyzing market transactions for comparable assets income approach uses earnings or net present value of estimated future cash flows adjusted for liquidity and risk factors.
 commodities categorized as level 1 are traded on active commodity exchange valued at closing prices on last trading day of year.
 commodities categorized level 2 represent shares in commingled commodity fund valued using nav  corroborated by observable market data.
 contributions expected benefit payments we determine funding requirements for defined benefit pension plans consistent with cas and internal revenue code rules.
 in 2012  made contributions of $ 3. 6 billion to qualified defined benefit pension plans.
 plan to make contributions of approximately $ 1. 5 billion to defined benefit pension plans in 2013.
 in 2012  made contributions of $ 235 million to retiree medical and life insurance plans.
 expect no required contributions related to retiree medical and life insurance plans in 2013.
 table presents estimated future benefit payments  reflect expected future employee service  as of december 31, 2012 ( in millions ) :.
 defined contribution plans maintain number defined contribution plans  most with 401 ( k ) features cover substantially all employees.
 under 401 plans match most employees 2019 eligible contributions at rates specified in plan documents.
 contributions were $ 380 million in 2012 , $ 378 million in 2011  $ 379 million in 2010  majority funded in common stock.
 defined contribution plans held approximately 48. 6 million and 52. 1 million shares of common stock as of december 31 , 2012 and 2011.

| 2013   | 2014   | 2015   | 2016   | 2017   | 2018 - 2022
---------------------------------------- | ------ | ------ | ------ | ------ | ------ | -----------
qualified defined benefit pension plans  | $ 1900 | $ 1970 | $ 2050 | $ 2130 | $ 2220 | $ 12880
retiree medical and life insurance plans | 200    | 210    | 220    | 220    | 220    | 1080


management 2019s discussion analysis 150 jpmorgan chase & co. /2012 annual report wholesale credit portfolio as of december 31 , 2012 wholesale exposure ( cib , cb am ) increased by $ 70. 9 billion from december 31  2011  driven by increases $ 52. 1 billion lending- related commitments $ 30. 2 billion loans due to increased client activity regions businesses.
 increase in loans due to growth in cb am.
 increases partially offset by $ 17. 5 billion decrease in derivative receivables related to decline in.
 dollar  tightening of credit spreads changes resulted in reductions to interest rate credit derivative foreign exchange balances.
 wholesale credit portfolio december 31, credit exposure nonperforming ) d ).
 receivables from customers other 23648 17461 2014 2014 total wholesale credit- related assets 411814 392954 1784 2878 lending-related commitments 434814 382739 355 865 total wholesale credit exposure $ 846628 $ 775693 $ 2139 $ 3743 credit portfolio management derivatives notional net ( b ) $ ( 27447 ) $ ( 26240 ) $ ( 25 ) $ ( 38 ) liquid securities cash collateral held against derivatives ( 13658 ) ( 21807 ) a ) receivables from customers other includes margin loans to prime retail brokerage customers classified in accrued interest accounts receivable on consolidated balance sheets.
 ( b ) represents net notional amount protection purchased sold through credit derivatives manage performing nonperforming wholesale credit exposures derivatives not qualify for hedge accounting.
.
 excludes synthetic credit portfolio.
 additional information see credit derivatives on pages 158 2013159  note 6 on pages 218 2013227 annual report.
 excludes assets acquired in loan satisfactions.
( d ) prior to first quarter 2012 , reported amounts only included defaulted derivatives ; effective in first quarter 2012 , reported amounts in all periods include both defaulted derivatives derivatives risk rated as nonperforming.

december 31 , ( in millions )                                        | december 31 , 2012 | december 31 , 2011 | 2012         | 2011
-------------------------------------------------------------------- | ------------------ | ------------------ | ------------ | ------------
loans retained                                                       | $ 306222           | $ 278395           | $ 1434       | $ 2398
loans held-for-sale                                                  | 4406               | 2524               | 18           | 110
loans at fair value                                                  | 2555               | 2097               | 93           | 73
loans 2013 reported                                                  | 313183             | 283016             | 1545         | 2581
derivative receivables                                               | 74983              | 92477              | 239          | 297
receivables from customers and other ( a )                           | 23648              | 17461              | 2014         | 2014
total wholesale credit-related assets                                | 411814             | 392954             | 1784         | 2878
lending-related commitments                                          | 434814             | 382739             | 355          | 865
total wholesale credit exposure                                      | $ 846628           | $ 775693           | $ 2139       | $ 3743
credit portfolio management derivatives notional net ( b )           | $ -27447 ( 27447 ) | $ -26240 ( 26240 ) | $ -25 ( 25 ) | $ -38 ( 38 )
liquid securities and other cash collateral held against derivatives | -13658 ( 13658 )   | -21807 ( 21807 )   | na           | na


notes to consolidated financial statements components of accumulated comprehensive loss  net of related tax follows:.
 aon corporation

( millions ) as of december 31       | 2007           | 2006             | 2005
------------------------------------ | -------------- | ---------------- | ----------------
net derivative gains ( losses )      | $ 24           | $ 15             | $ -11 ( 11 )
net unrealized investment gains      | 76             | 73               | 52
net foreign exchange translation     | 284            | 118              | -119 ( 119 )
postretirement plans                 | -1110 ( 1110 ) | -1216 ( 1216 )   | -1077 ( 1077 )
accumulated other comprehensive loss | $ -726 ( 726 ) | $ -1010 ( 1010 ) | $ -1155 ( 1155 )


page 27 of 100 liquidity items cash payments required for long-term debt maturities rental payments under noncancellable operating leases purchase obligations commitments effect at december 31 , 2010 summarized in table:.
 total payments on contractual obligations $ 10697. 7 $ 2935. 6 $ 4321. 2 $ 785. 9 $ 2655. 0 ( a ) amounts reported in local currencies translated at year-end 2010 exchange rates.
 ( b ) for variable rate facilities  amounts based on interest rates at year end do not contemplate effects of hedging instruments.
 c ) company 2019s purchase obligations include contracted amounts for aluminum  steel other direct materials.
 included are commitments for purchases of natural gas and electricity  aerospace and technologies contracts other less significant items.
 variable prices usage involved management 2019s best estimates used.
 depending on circumstances early termination of contracts may result in penalties actual payments could vary.
 table not include $ 60. 1 million of uncertain tax positions timing uncertain.
 contributions to company 2019s defined benefit pension plans  not including unfunded german plans expected to in range of $ 30 million in 2011.
 estimate may change based on changes in pension protection act actual plan asset performance.
 benefit payments related to these plans expected to be $ 71. 4 million , $ 74. 0 million , $ 77. 1 million , $ 80. 3 million $ 84. 9 million for years ending december 31 , 2011 through 2015  total of $ 483. 1 million for years 2016 through 2020.
 payments to participants in unfunded german plans expected between $ 21. 8 million ( 20ac16. 5 million ) to $ 23. 2 million ( 20ac17. 5 million ) in each years 2011 through 2015 total of $ 102.7 million ( 20ac77. 5 million ) for years 2016 through 2020.
.
 pension plans in 2011  changed return on asset assumption to 8. 00 percent ( from 8. 25 percent in 2010 ) discount rate assumption to average of 5. 55 percent ( from 6. 00 percent in 2010 ).
 changes in assumptions pension expense in 2011 anticipated be relatively flat compared to 2010.
 reduction of expected return on pension assets assumption by quarter of percentage point in estimated $ 2. 9 million increase in 2011 global pension expense quarter of percentage point reduction in discount rate pension liability in estimated $ 3. 5 million additional pension expense in 2011.
 additional information company 2019s pension plans in note 14 consolidated financial statements item 8 report.
 annual cash dividends paid on common stock were 20 cents per share in 2010 , 2009 and 2008.
 total dividends paid were $ 35. 8 million in 2010 , $ 37. 4 million in 2009 $ 37. 5 million in 2008.
 january 26, 2011 company board of directors approved increase in quarterly dividends to 7 cents per share.
 share repurchases repurchases  net of issuances totaled $ 506. 7 million in 2010 , $ 5. 1 million in 2009 $ 299. 6 million in 2008.
 november 2, 2010 acquired 2775408 shares of publicly held common stock in private transaction for $ 88. 8 million.
 february 17 , 2010  entered accelerated share repurchase agreement to buy $ 125. 0 million of common shares using cash on hand and available borrowings.
 advanced $ 125. 0 million on february 22 , 2010  received 4323598 shares represented 90 percent of total shares calculated using previous day 2019s closing price.
 agreement settled on may 20 , 2010  company received additional 398206 shares.
repurchases in 2008 included $ 31 million settlement january 7, 2008, forward contract entered december 2007 for repurchase of 1350000 shares.
 from january 1 through february 24 , 2011 , ball repurchased additional $ 143. 3 million common stock.

( $ in millions )                         | payments due by period ( a ) total | payments due by period ( a ) less than1 year | payments due by period ( a ) 1-3 years | payments due by period ( a ) 3-5 years | payments due by period ( a ) more than5 years
----------------------------------------- | ---------------------------------- | -------------------------------------------- | -------------------------------------- | -------------------------------------- | ---------------------------------------------
long-term debt including capital leases   | $ 2750.1                           | $ 34.5                                       | $ 188.3                                | $ 367.1                                | $ 2160.2
interest payments on long-term debt ( b ) | 1267.5                             | 160.5                                        | 316.4                                  | 304.2                                  | 486.4
operating leases                          | 93.2                               | 31.1                                         | 37.1                                   | 16.6                                   | 8.4
purchase obligations ( c )                | 6586.9                             | 2709.5                                       | 3779.4                                 | 98.0                                   | 2212
total payments on contractual obligations | $ 10697.7                          | $ 2935.6                                     | $ 4321.2                               | $ 785.9                                | $ 2655.0


cash cash equivalents include highly-liquid investments with maturity three months or less when purchased.
 accounts receivable and allowance for doubtful accounts carried at invoiced amounts less allowance for doubtful accounts generally do not bear interest.
 company estimates balance of allowance for doubtful accounts by analyzing accounts receivable balances by age applying historical write-off and collection trend rates.
 estimates include separately providing for customer receivables based on specific circumstances credit conditions when probable balance uncollectible.
 account balances are written off against allowance when determined receivable not be recovered.
 company 2019s allowance for doubtful accounts balance includes allowance for expected return of products shipped and credits related to pricing or quantities shipped of $ 15 million, $ 14 million and $ 15 million as of december 31 , 2017 , 2016 , 2015 .
 returns and credit activity recorded directly to sales as reduction.
 table summarizes activity in allowance for doubtful accounts:.
 other amounts are effects of changes in currency translations and impact of allowance for returns and credits.
 inventory valuations inventories valued at lower of cost or net realizable value.
.
 inventory costs determined on last-in , first-out ( 201clifo 201d ) basis.
 inventories represented 39% ( 39 % ) and 40% ( 40 % ) of consolidated inventories as of december 31 , 2017 and 2016 .
 all other inventory costs determined using average cost or first-in , first-out ( 201cfifo 201d ) methods.
 inventory values at fifo  shown in note 5  approximate replacement cost.
 property , plant and equipment property assets stated at cost.
merchandising customer equipment consists of dispensing systems for company 2019s cleaning sanitizing products  dishwashing machines process control monitoring equipment.
 certain dispensing systems capitalized by company accounted for on mass asset basis equipment capitalized depreciated as a group written off when fully depreciated.
 company capitalizes internal and external costs of development purchase of computer software for internal use.
 costs for data conversion  training maintenance associated with capitalized software expensed as incurred.
 expenditures for major renewals improvements  extend useful lives of existing plant equipment  are capitalized and depreciated.
 expenditures for repairs maintenance charged to expense as incurred.
 upon retirement disposition of plant equipment  cost related accumulated depreciation removed from accounts gain or loss recognized in income.
 depreciation charged to operations using straight-line method over assets 2019 estimated useful lives ranging from 5 to 40 years for buildings leasehold improvements 3 to 20 years for machinery and equipment 3 to 15 years for merchandising customer equipment 3 to 7 years for capitalized software.
 straight-line method of depreciation reflects appropriate allocation of cost of assets to earnings in proportion to economic benefits obtained by company in each reporting period.
 depreciation expense was $ 586 million , $ 561 million $ 560 million for 2017 , 2016 2015  respectively.

( millions )      | 2017           | 2016           | 2015
----------------- | -------------- | -------------- | --------------
beginning balance | $ 67.6         | $ 75.3         | $ 77.5
bad debt expense  | 17.1           | 20.1           | 25.8
write-offs        | -15.7 ( 15.7 ) | -24.6 ( 24.6 ) | -21.9 ( 21.9 )
other ( a )       | 2.5            | -3.2 ( 3.2 )   | -6.1 ( 6.1 )
ending balance    | $ 71.5         | $ 67.6         | $ 75.3


11.
 borrowings short-term borrowings carrying value of at december 31 , 2012 and 2011  included $ 100 million under 2012 revolving credit facility and $ 100 million under 2011 revolving credit facility.
 2012 revolving credit facility.
 in march 2011  company entered into five-year $ 3. 5 billion unsecured revolving credit facility ( 201c2011 credit facility 201d ).
 in march 2012 2011 credit facility amended to extend maturity date by one year to march 2017 in april 2012 aggregate commitment increased to $ 3. 785 billion ( 201c2012 credit facility 201d ).
 2012 credit facility permits company to request additional $ 1. 0 billion borrowing capacity subject to lender credit approval increasing overall size 2012 credit facility to aggregate principal amount not to exceed $ 4. 785 billion.
 interest on borrowings outstanding accrues at rate based on applicable london interbank offered rate plus spread.
 2012 credit facility requires company not to exceed maximum leverage ratio ( ratio net debt to ebitda ) of 3 to 1 satisfied with ratio of less than 1 to 1 at december 31 , 2012.
 2012 credit facility provides back-up liquidity funds ongoing working capital for general corporate purposes and funds various investment opportunities.
 at december 31 , 2012 company had $ 100 million outstanding under facility with interest rate of 1. 085% ( 1. 085 % ) maturity during january 2013.
 2013 company rolled over $ 100 million in borrowings at interest rate of 1. 085% ( 1. 085 % ) maturity during february 2013.
 2013 rolled over $ 100 million in borrowings at interest rate of 1. 075% ( 1. 075 % ) maturity during march 2013.
 commercial paper program.
october 14, 2009 blackrock established commercial paper program ( 201ccp program 201d ) company could issue unsecured commercial paper notes 201ccp notes 201d ) private placement basis to maximum aggregate amount outstanding $ 3. 0 billion.
 may 13 , 2011 blackrock increased maximum aggregate amount borrowed under cp program to $ 3. 5 billion.
 may 17 , 2012 blackrock increased maximum aggregate amount to $ 3. 785 billion.
 cp program supported by 2012 credit facility.
 as of december 31 , 2012 and december 31 , 2011 blackrock had no cp notes outstanding.
 long-term borrowings carrying value fair value of long-term borrowings estimated using market prices at december 31 , 2012 included : ( dollar amounts in millions ) maturity amount unamortized discount carrying value fair value.

( dollar amounts in millions )    | maturity amount | unamortized discount | carrying value | fair value
--------------------------------- | --------------- | -------------------- | -------------- | ----------
floating rate notes due 2013      | $ 750           | $ 2014               | $ 750          | $ 750
3.50% ( 3.50 % ) notes due 2014   | 1000            | 2014                 | 1000           | 1058
1.375% ( 1.375 % ) notes due 2015 | 750             | 2014                 | 750            | 762
6.25% ( 6.25 % ) notes due 2017   | 700             | -3 ( 3 )             | 697            | 853
5.00% ( 5.00 % ) notes due 2019   | 1000            | -2 ( 2 )             | 998            | 1195
4.25% ( 4.25 % ) notes due 2021   | 750             | -4 ( 4 )             | 746            | 856
3.375% ( 3.375 % ) notes due 2022 | 750             | -4 ( 4 )             | 746            | 801
total long-term borrowings        | $ 5700          | $ -13 ( 13 )         | $ 5687         | $ 6275


entergy arkansas , inc.
 subsidiaries management 2019s financial discussion analysis results of operations net income 2016 compared to 2015 net income increased $ 92. 9 million due to higher net revenue lower operation maintenance expenses partially offset by higher effective income tax rate higher depreciation amortization expenses.
 2015 compared to 2014 net income decreased $ 47. 1 million due to higher operation maintenance expenses offset by higher net revenue.
 net revenue 2016 compared to 2015 consists of operating revenues net of 1 fuel , fuel-related expenses gas purchased for resale 2 purchased power expenses  3 ) other regulatory charges ( credits ).
 analysis of change in net revenue comparing 2016 to 2015.
 amount ( in millions ).
 retail electric price variance due to increase in base rates approved by apsc.
 new base rates effective february 24 , 2016 began billing with first billing cycle of april 2016.
 increase includes interim base rate adjustment surcharge effective with first billing cycle of april 2016 to recover incremental revenue requirement for period february 24 , 2016 through march 31 , 2016.
 significant portion of increase related to purchase of power block 2 of union power station.
 see note 2 to financial statements for discussion of rate case.
 see note 14 to financial statements for discussion union power station purchase.

| amount ( in millions )
--------------------- | ----------------------
2015 net revenue      | $ 1362.2
retail electric price | 161.5
other                 | -3.2 ( 3.2 )
2016 net revenue      | $ 1520.5


equity compensation plan information table presents equity securities available for issuance under equity compensation plans as of december 31 , 2018.
 equity compensation plan information plan category number of securities to be issued upon exercise of outstanding options , warrants and rights ( 1 ) weighted-average exercise price of outstanding options , warrants and rights number of securities remaining available for future issuance under plans ( excluding securities reflected in column ( a ) ) b ) c ) equity compensation plans approved by security holders 399165 $ 0. 00 3995600 equity compensation plans not approved by security holders ( 2 ) 2014.
 includes grants made under huntington ingalls industries , inc.
 2012 long-term incentive stock plan ( "2012 plan" ) approved by stockholders on may 2 , 2012 and huntington ingalls industries , inc.
 2011 long-term incentive stock plan ( "2011 plan" ) approved by sole stockholder of hii prior to spin-off from northrop grumman corporation.
 shares 27123 were stock rights granted under 2011 plan.
 number includes 31697 stock rights , 5051 restricted stock rights , and 335293 restricted performance stock rights granted under 2012 plan  target performance achievement.
 no awards made under plans not approved by security holders.
 item 13.
 certain relationships and related transactions , and director independence information relationships transactions director independence will be incorporated by reference to proxy statement for 2019 annual meeting of stockholders filed within 120 days after end of company 2019s fiscal year.
 item 14.
 principal accountant fees and services information will incorporated by reference to proxy statement for 2019 annual meeting of stockholders  filed within 120 days after end of company 2019s fiscal year.

plan category                                                    | number of securities to be issued upon exercise of outstanding options warrants and rights ( 1 ) ( a ) ( b ) | weighted-average exercise price of outstanding optionswarrants and rights | number of securities remaining available for future issuance under equity compensation plans ( excluding securitiesreflected in column ( a ) ) ( c )
---------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------ | ------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------
equity compensation plans approved by security holders           | 399165                                                                                | $ 0.00                                                                    | 3995600
equity compensation plans not approved by security holders ( 2 ) | 2014                                                                                | 2014                                                                      | 2014
total                                                            | 399165                                                                                | $ 0.00                                                                    | 3995600


nbcuniversal media  llc consolidated statement comprehensive income.
 accompanying notes consolidated financial statements.
 147 2015 annual report form 10-k

year ended december 31 ( in millions )                                       | 2015         | 2014         | 2013
---------------------------------------------------------------------------- | ------------ | ------------ | ------------
net income                                                                   | $ 3624       | $ 3297       | $ 2122
deferred gains ( losses ) on cash flow hedges net                            | -21 ( 21 )   | 25           | -5 ( 5 )
employee benefit obligations net                                             | 60           | -106 ( 106 ) | 95
currency translation adjustments net                                         | -121 ( 121 ) | -62 ( 62 )   | -41 ( 41 )
comprehensive income                                                         | 3542         | 3154         | 2171
net ( income ) loss attributable to noncontrolling interests                 | -210 ( 210 ) | -182 ( 182 ) | -154 ( 154 )
other comprehensive ( income ) loss attributable to noncontrolling interests | 29           | 2014         | 2014
comprehensive income attributable to nbcuniversal                            | $ 3361       | $ 2972       | $ 2017


entergy corporation subsidiaries notes to financial statements consists of pollution control revenue bonds and environmental revenue bonds.
 b bonds secured by collateral first mortgage bonds.
 in december 2005  entergy corporation sold 10 million equity units with stated amount of $ 50 each.
 equity unit consisted of 1 ) note  initially due february 2011 bearing interest at annual rate of 5. 75% ( 5. 75 % )  2 ) purchase contract obligated holder equity unit to purchase for $ 50 between 0. 5705 and 0. 7074 shares of entergy corporation common stock on or before february 17, 2009.
 entergy paid holders quarterly contract adjustment payments of 1. 875% ( 1. 875 % ) per year on stated amount $ 50 per equity unit.
 under terms purchase contracts entergy attempted to remarket notes in february 2009 unsuccessful note holders put notes to entergy entergy retired notes entergy issued 6598000 shares of common stock in settlement of purchase contracts.
 pursuant to nuclear waste policy act of 1982 entergy's nuclear owner/licensee subsidiaries have contracts with doe for spent nuclear fuel disposal service.
 contracts include one-time fee for generation prior to april 7 , 1983.
 entergy arkansas only entergy company generated electric power with nuclear fuel prior to that date includes one-time fee  plus accrued interest  long-term fair value excludes lease obligations , long-term doe obligations  note payable to nypa  includes debt due within one year.
 determined using bid prices reported by dealer markets and nationally recognized investment banking firms.
 entergy gulf states louisiana remains primarily liable for all long-term debt issued by entergy gulf states , inc.
outstanding december 31 , 2008 2007.
 under debt assumption agreement with entergy gulf states louisiana  entergy texas assumed 46% ( 46 % ) of long-term debt.
 annual long-term debt maturities ( excluding lease obligations ) for debt outstanding as of december 31 , 2008  for next five years follows : amount ( in thousands ).
 november 2000  entergy's non-utility nuclear business purchased fitzpatrick and indian point 3 power plants in seller-financed transaction.
 entergy issued notes to nypa with seven annual installments of approximately $ 108 million commencing one year from date closing eight annual installments of $ 20 million commencing eight years from date closing.
 notes have stated interest rate implicit interest rate of 4. 8% (. 8 % ).
 accordance purchase agreement with nypa purchase of indian point 2 in 2001 resulted in entergy's non-utility nuclear business liable to nypa for additional $ 10 million per year for 10 years beginning september 2003.
 liability recorded upon purchase of indian point 2 september 2001 included in note payable to nypa balance above.
 july 2003  payment of $ 102 million made prior to maturity on note payable to nypa.
 under provision in letter of credit supporting notes if utility operating companies or system energy default on other indebtedness entergy could be required to post collateral to support letter of credit.
 covenants in entergy corporation notes require maintain consolidated debt ratio of 65% ( 65 % ) or less of total capitalization.
 if entergy's debt ratio exceeds limit or entergy or utility operating companies default on other indebtedness or in bankruptcy or insolvency proceedings acceleration of notes' maturity dates may occur.
entergy gulf states louisiana , entergy mississippi texas  system energy received ferc long-term financing orders authorizing long-term securities issuances.
 entergy arkansas has

| amount ( in thousands )
---- | -----------------------
2009 | $ 516019
2010 | $ 763036
2011 | $ 897367
2012 | $ 3625459
2013 | $ 579461


may 26 , 2019  expect to pay approximately $ 2. 0 million unrecognized tax benefit liabilities accrued interest within next 12 months.
 not able estimate future cash flows beyond 12 months due to uncertainties timing tax audit outcomes.
 remaining amount unrecognized tax liability classified in other liabilities.
 report accrued interest penalties related to unrecognized tax benefit liabilities in income tax expense.
 for fiscal 2019  recognized $ 0. 5 million tax-related net interest penalties had $ 26. 0 million accrued interest penalties as of may 26 , 2019.
 fiscal 2018  recognized net benefit of $ 3. 1 million tax-related net interest penalties had $ 27. 3 million accrued interest penalties as of may 27 , 2018.
 note 15.
 leases , other commitments  contingencies leases generally for warehouse space equipment.
 rent expense under all operating leases continuing operations was $ 184. 9 million in fiscal 2019  $ 189. 4 million fiscal 2018  $ 188. 1 million in fiscal 2017.
 some operating leases require payment property taxes  insurance  maintenance costs in addition to rent payments.
 contingent escalation rent in excess of minimum rent payments sublease income netted in rent expense insignificant.
 noncancelable future lease commitments millions operating leases capital leases.
 depreciation on capital leases recorded as depreciation expense in results of operations.
 as of may 26 , 2019 issued guarantees comfort letters of $ 681. 6 million for debt other obligations of consolidated subsidiaries guarantees comfort letters of $ 133. 9 million for debt obligations of non-consolidated affiliates mainly.
off-balance sheet arrangements limited to future payments under non-cancelable operating leases totaled $ 482. 6 million as of may 26 , 2019.
 note 16.
 business segment geographic information operate in packaged foods industry.
 operating segments are : north america retail ; convenience stores & foodservice ; europe & australia ; asia & latin america ; pet.
 north america retail operating segment reflects business with of grocery stores  mass merchandisers membership stores  natural food chains  drug , dollar discount chains  e-commerce grocery providers.
 product categories are ready-to-eat cereals  refrigerated yogurt , soup , meal kits  refrigerated frozen dough products  dessert and baking mixes  frozen pizza pizza snacks  grain , fruit savory snacks  of organic products including refrigerated yogurt  nutrition bars  meal kits  salty snacks  ready-to-eat cereal  grain snacks.

in millions                                      | operating leases | capital leases
------------------------------------------------ | ---------------- | --------------
fiscal 2020                                      | $ 120.0          | $ 0.2
fiscal 2021                                      | 101.7            | 0.1
fiscal 2022                                      | 85.0             | -
fiscal 2023                                      | 63.8             | -
fiscal 2024                                      | 49.1             | -
after fiscal 2024                                | 63.0             | -
total noncancelable future lease commitments     | $ 482.6          | $ 0.3
less : interest                                  |                  | -
present value of obligations under capitalleases |                  | $ 0.3


kimco realty corporation and subsidiaries notes to consolidated financial statements continued other 2014 connection with construction of development projects related infrastructure certain public agencies require posting performance and surety bonds to guarantee company 2019s obligations satisfied.
 these bonds expire upon completion of improvements and infrastructure.
 as of december 31 , 2010  approximately $ 45. 3 million in performance and surety bonds outstanding.
 as of december 31 , 2010  company had accrued $ 3. 8 million in with legal claim related to previously sold ground-up development project.
 company currently negotiating with plaintiff to settle claim believes prob- able settlement amount will approximate amount accrued.
 company subject to other legal proceedings and claims arise in ordinary course of business.
 management believes final outcome of matters not have material adverse effect on financial position , results of operations or liquidity of company.
 23.
 incentive plans : company maintains two equity participation plans , second amended restated 1998 equity participation plan ( 201cprior plan 201d ) and 2010 equity participation plan ( 201c2010 plan 201d ) collectively 201cplans 201d ).
 prior plan provides for maxi- mum of 47000000 shares of company 2019s common stock to issued for qualified and non-qualified options and restricted stock grants.
 2010 plan provides for maximum of 5000000 shares of company 2019s common stock to be issued for qualified and non-qualified options , restricted stock  performance awards other awards plus number of shares of common stock available for issuance under prior plan not issued under prior plan subject to certain conditions.
 unless otherwise determined by board of directors sole discretion options granted under plans generally vest ratably over three to five years expire ten years from date of grant exercisable at market price on date of grant.
restricted stock grants vest i 100% ( 100 % ) on fourth or fifth anniversary grant ii ratably over three or four years or iii ) over three years at 50% ( 50 % ) after two years and 50% ( 50 % ) after third year.
 performance share awards may provide right to receive shares of restricted stock based on company 2019s performance relative to peers or other performance criteria determined by board of directors.
 plans provide for granting of certain options and restricted stock to company 2019s non-employee directors ( 201cindependent directors 201d ) permits independent directors to elect receive deferred stock awards in lieu of directors 2019 fees.
 company accounts for stock options in accordance with fasb 2019s compensation 2014stock compensation guidance requires all share based payments to employees including grants of employee stock options recognized in statement of operations over service period based on fair values.
 fair value of each option award estimated on date of grant using black-scholes option pricing formula.
 assump- tion for expected volatility significant affect on grant date fair value.
 volatility determined based on historical equity of common stock for most recent historical period equal to expected term of options plus implied volatility measure.
 significant assumptions underlying determination of fair values for options granted during 2010 , 2009 2008 were : year ended december 31 , 2010 2009 2008.

2009                                                | year ended december 31 2010 2009 | year ended december 31 2010 2009 | year ended december 31 2010
--------------------------------------------------- | -------------------------------- | -------------------------------- | ---------------------------
weighted average fair value of options granted      | $ 3.82                           | $ 3.16                           | $ 5.73
weighted average risk-free interest rates           | 2.40% ( 2.40 % )                 | 2.54% ( 2.54 % )                 | 3.13% ( 3.13 % )
weighted average expected option lives ( in years ) | 6.25                             | 6.25                             | 6.38
weighted average expected volatility                | 37.98% ( 37.98 % )               | 45.81% ( 45.81 % )               | 26.16% ( 26.16 % )
weighted average expected dividend yield            | 4.21% ( 4.21 % )                 | 5.48% ( 5.48 % )                 | 4.33% ( 4.33 % )


impairment of long-lived assets based on projection of undiscounted cash flows events or changes circumstances indicate carrying amounts of assets may not be recoverable.
 cash flows not expected sufficient to recover recorded value of assets assets written down to estimated fair values ( see note 5 ).
 asset retirement obligations 2014effective january 1 , 2003  company adopted statement financial accounting standards ( 2018 2018sfas 2019 2019 ) no.
 143  2018 2018accounting for asset retirement obligations. 2019 2019 sfas.
 143 requires company to record fair value of legal liability for asset retirement obligation in period incurred.
 when new liability recorded company capitalize costs of liability by increasing carrying amount of related long-lived asset.
 liability accreted to present value each period capitalized cost depreciated over useful life of related asset.
 upon settlement liability company settles obligation for recorded amount or incurs gain or loss upon settlement.
 company 2019s retirement obligations covered by sfas no.
 143 include active ash landfills  water treatment basins removal or dismantlement of certain plant and equipment.
 as of december 31 , 2003 and 2002  company had recorded liabilities of approximately $ 29 million and $ 15 million  related to asset retirement obligations.
 no assets legally restricted for settling asset retirement obligations.
 upon adoption of sfas no.
 143  company recorded additional liability of approximately $ 13 million  net asset of approximately $ 9 million  cumulative effect of change in accounting principle of approximately $ 2 million  after income taxes.
 amounts recorded related to asset retirement obligations during years ended december 31 , 2003 were as follows ( in millions ) :.
proforma net ( loss ) income earnings per share not presented for years ended december 31 , 2002 and 2001 because proforma application of sfas no.
 143 to prior periods result in net income earnings per share not different from actual amounts reported for periods in consolidated statements of operations.
 had sfas 143 applied during all periods asset retirement obligation at january 1 , 2001 , december 31 , 2001 december 31  2002 would have been approximately $ 21 million , $ 23 million $ 28 million , respectively.
 included in other long-term liabilities is accrual for non-legal obligations for removal of assets in service at ipalco amounting to $ 361 million and $ 339 million at december 31 , 2003 and 2002 ,.
 deferred financing costs 2014financing costs deferred amortized over related financing period using effective interest method or straight-line method when not differ.
 deferred financing costs shown net of accumulated amortization of $ 202 million and $ 173 million as of december 31 , 2003 and 2002 .
 project development costs 2014the company capitalizes costs of developing new construction projects after achieving project-related milestones indicate project completion probable.
 costs represent amounts incurred for professional services  permits  options  capitalized interest  other costs related to construction.
 costs transferred to construction in progress when significant construction activity commences or expensed at time company determines development of project no longer probable ( see note 5 ).

balance at december 31 2002                                               | $ 15
------------------------------------------------------------------------- | --------
additional liability recorded from cumulative effect of accounting change | 13
accretion expense                                                         | 2
change in the timing of estimated cash flows                              | -1 ( 1 )
balance at december 31 2003                                               | $ 29


19.
 income taxes continued ) capital loss carryforwards of $ 69 million and $ 90 million  acquired in bgi transaction expire or before 2013.
 at december 31 , 2012 and 2011  company had $ 95 million and $ 95 million valuation allowances for deferred income tax assets recorded on consolidated statements of financial condition.
 year- over-year increase in valuation allowance related to certain foreign deferred income tax assets.
 goodwill recorded in with quellos transaction reduced by tax benefit realized from tax-deductible goodwill.
 see note 9 , goodwill for.
 current income taxes recorded net in consolidated statements of financial condition related to same tax jurisdiction.
 as of december 31 , 2012  company had current income taxes receivable and payable of $ 102 million and $ 121 million recorded in other assets and accounts payable and accrued liabilities.
 as of december 31 , 2011  company had current income taxes receivable and payable of $ 108 million and $ 102 million recorded in other assets accounts payable accrued liabilities.
 company does not provide deferred taxes on excess of financial reporting over tax basis on investments in foreign subsidiaries essentially permanent duration.
 excess totaled $ 2125 million and $ 1516 million as of december 31, 2012 and 2011 .
 determination of additional deferred income taxes on excess not provided not practicable due to complexities associated with hypothetical calculation.
 following tabular reconciliation presents total amounts of gross unrecognized tax benefits : year ended december 31 , ( dollar amounts in millions ) 2012 2011 2010.
in balance of unrecognized tax benefits at december 31 , 2012 , 2011 and 2010  respectively are $ 250 million , $ 226 million and $ 194 million of tax benefits if recognized would affect effective tax rate.
 company recognizes interest and penalties related to income tax matters as component of income tax expense.
 company accrued interest and penalties of $ 3 million during 2012 in total  as of december 31 , 2012  had recognized liability for interest and penalties of $ 69 million.
 company accrued interest and penalties of $ 10 million during 2011 in total as of december 31, 2011  recognized liability for interest and penalties of $ 66 million.
 company accrued interest and penalties of $ 8 million during 2010 in total as of december 31 , 2010 recognized liability for interest and penalties of $ 56 million.
 amended restated stock purchase agreement company indemnified by barclays for $ 73 million and guggenheim for $ 6 million of unrecognized tax benefits.
 blackrock subject to.
 federal income tax , state and local income tax  foreign income tax in multiple jurisdictions.
 tax years after 2007 remain open to.
 federal income tax examination tax years after 2005 to state and local income tax examination tax years after 2006 open to income tax examination in united kingdom.
 few exceptions as of december 31 , 2012 company no longer subject to.
 federal , state  local or foreign examinations by tax authorities for years before 2006.
 internal revenue service ( completed examination of blackrock 2019s 2006 and 2007 tax years in march 2011.
 in november 2011 commenced examination of blackrock 2019s 2008 and 2009 tax years impact on consolidated financial statements is undetermined not expected to be material.
july 2011 irs commenced federal income tax audit of bgi group blackrock acquired december 2009.
 tax years under examination are 2007 through december 1 , 2009 impact on consolidated financial statements undetermined not expected be material.
 company currently under audit in several state and local jurisdictions.
 significant state local income tax examinations in california for tax years 2004 through 2006  new york city tax years 2007 through 2008  new jersey for tax years 2003 through 2009.
 no state local income tax audits cover years earlier than 2007 except for california  new jersey new york city.
 no state local income tax audits expected to result in assessment material to consolidated financial statements.

( dollar amounts in millions )                           | year ended december 31 , 2012 | year ended december 31 , 2011 | year ended december 31 , 2010
-------------------------------------------------------- | ----------------------------- | ----------------------------- | -----------------------------
balance at january 1                                     | $ 349                         | $ 307                         | $ 285
additions for tax positions of prior years               | 4                             | 22                            | 10
reductions for tax positions of prior years              | -1 ( 1 )                      | -1 ( 1 )                      | -17 ( 17 )
additions based on tax positions related to current year | 69                            | 46                            | 35
lapse of statute of limitations                          | 2014                          | 2014                          | -8 ( 8 )
settlements                                              | -29 ( 29 )                    | -25 ( 25 )                    | -2 ( 2 )
positions assumed in acquisitions                        | 12                            | 2014                          | 4
balance at december 31                                   | $ 404                         | $ 349                         | $ 307


r&d expense increased 36% ( 36 % ) during 2011 compared to 2010 declined slightly as percentage of net sales due to 66% ( 66 % ) year-over-year growth in company 2019s net sales 2011.
 r&d expense increased 34% ( 34 % ) or $ 449 million to $ 1. 8 billion in 2010 compared to 2009.
 increase due primarily to increase in headcount related expenses current year support expanded r&d activities.
 contributing to increase r&d expense 2010 was capitalization in 2009 of software development costs of $ 71 million related to mac os x snow leopard.
 total r&d expense increased 34% ( 34 % ) during 2010 declined as percentage of net sales given 52% ( 52 % ) year-over-year increase in net sales company focused investments in r&d critical to future growth competitive position related to timely development of new enhanced products central to company core business strategy.
 company expects to make further investments in r&d to remain competitive.
 selling  general and administrative expense ( 201csg&a 201d ) sg&a expense increased $ 2. 1 billion or 38% ( 38 % ) to $ 7. 6 billion 2011 compared to 2010.
 increase due primarily to company continued expansion of retail segment increased headcount related costs higher spending on professional services marketing and advertising programs increased variable costs associated with overall growth company 2019s net sales.
 sg&a expense increased $ 1. 4 billion or 33% ( 33 % ) to $ 5. 5 billion in 2010 compared to 2009.
 increase due primarily to company continued expansion of retail segment  higher spending on marketing advertising programs increased share-based compensation expenses variable costs associated with overall growth company 2019s net sales.
 other income and expense for three years ended september 24 , 2011 as follows ( in millions ) :.
other income and expense increased $ 260 million or 168% ( 168 % ) to $ 415 million during 2011 compared to $ 155 million and $ 326 million in 2010 and 2009 .
 year-over-year increase in income expense 2011 due primarily to higher interest income net realized gains on sales of marketable securities.
 overall decrease in other income and expense in 2010 compared to 2009 attributable to significant declines in interest rates partially offset by company higher cash , cash equivalents marketable securities balances.
 company incurred higher premium expenses on foreign exchange option contracts reduced total other income and expense.
 weighted average interest rate earned company on cash  cash equivalents marketable securities was 0. 77% ( 0. 77 % ) , 0. 75% ( 0. 75 % ) and 1. 43% ( 1. 43 % ) during 2011 , 2010 and 2009 .
 company had no debt outstanding did not incur related interest expense.
 provision for income taxes company 2019s effective tax rates were approximately 24. 2% ( 24. 2 % ) , 24. 4% ( 24. 4 % ) 31. 8% ( 31. 8 % ) for 2011 , 2010 and 2009 .
 company effective rates for differ from statutory federal income tax rate

| 2011         | 2010         | 2009
------------------------------ | ------------ | ------------ | ----------
interest and dividend income   | $ 519        | $ 311        | $ 407
other expense net              | -104 ( 104 ) | -156 ( 156 ) | -81 ( 81 )
total other income and expense | $ 415        | $ 155        | $ 326


part ii  item 8 fourth quarter 2007 : 0160 schlumberger sold workover rigs for $ 32 million pretax gain $ 24 million ( $ 17 million after-tax ) classified in interest and other income  net in consolidated statement of income.
 4.
 acquisitions acquisition of eastern echo holding plc december 10 , 2007  schlumberger completed acquisition eastern echo holding plc ( 201ceastern echo 201d ) for $ 838 million cash.
 eastern echo dubai-based marine seismic company operations at time acquisition had signed contracts for construction of six seismic vessels.
 purchase price allocated to net assets acquired based estimated fair values : ( stated in millions ).
 other acquisitions schlumberger made other acquisitions minority interest investments none significant individual basis for cash payments  net of cash acquired $ 514 million during 2009 $ 345 million 2008 $ 281 million 2007.
 pro forma results above acquisitions not presented impact not significant.
 5.
 drilling fluids joint venture mi-swaco drilling fluids joint venture owned 40% ( 40 % ) by schlumberger 60% ( 60 % ) by smith international .
 schlumberger records income relating venture using equity method accounting.
 carrying value of schlumberger 2019s investment in joint venture on december 31 , 2009 and 2008 was $ 1. 4 billion and $ 1. 3 billion  respectively included within investments in affiliated companies on consolidated balance sheet.
 schlumberger 2019s equity income from joint venture was $ 131 million in 2009 , $ 210 million in 2008 $ 178 million in 2007.
 schlumberger received cash distributions from joint venture of $ 106 million in 2009 , $ 57 million in 2008 $ 46 million in 2007.
joint venture agreement contains provision under either party to joint venture may offer to sell its entire interest in venture to other party at cash purchase price per percentage interest specified in offer notice.
 if offer to sell not accepted , offering party will obligated to purchase entire interest of other party at same price per percentage interest as prices specified in offer notice.

cash and short-term investments           | $ 266
----------------------------------------- | ------------
other current assets                      | 23
fixed income investments held to maturity | 54
vessels under construction                | 694
accounts payable and accrued liabilities  | -17 ( 17 )
long-term debt                            | -182 ( 182 )
total purchase price                      | $ 838