What changed in this filing

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Item 1A. Risk Factors

2024-02-14 compared with 2023-02-15 · 146 added, 102 removed, 639 unchanged (28% of the section changed)

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● the level of global inventories;

● events that impact global market demand (e.g., the reduced demand resulting from the COVID-19 pandemic);

● events that impact global market demand;

● prevailing prices on local price indexes in the areas in which we operate;

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The daily spot prices for NYMEX Henry Hub natural gas ranged from a high of $3.78 per MMBtu to a low of $1.74 per MMBtu in 2023, and the daily spot prices for NYMEX West Texas Intermediate crude oil ranged from a high of $96.37 per barrel to a low of $66.61 per barrel during the same period.

While oil and natural gas prices were generally higher in 2022 than they were in 2021, the markets for these commodities have historically been volatile, and these markets will likely continue to be volatile in the future.

While oil and natural gas prices were substantially lower in 2023 than they were in 2022, the markets for these commodities have historically been volatile, and these markets will likely continue to be volatile in the future.

In addition, the market price for natural gas in the Appalachian Basin continues to be lower relative to NYMEX Henry Hub as a result of the significant increases in the supply of natural gas in the Northeast region in recent years.

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Our hedging activities may prevent us from benefiting from price increases and may expose us to other risks.

To achieve more predictable cash flows and reduce our exposure to downward price fluctuations, we have historically entered into hedging contracts for a significant percentage of our expected production volumes.

For example, in 2021 we hedged approximately 91% of our natural gas production, 36% of our NGL production and 29% of our oil production.

To achieve more predictable cash flows and reduce our exposure to downward price fluctuations, we have historically entered into fixed swap hedging contracts for a significant percentage of our expected production volumes.

For example, in 2021 we hedged 91%, 36% and 29% of our natural gas, NGLs and oil production, respectively.

Additionally, in 2022 we hedged 49% of our natural gas production, and our NGLs and oil production was unhedged.

Due to our improved liquidity and leverage position as compared to past levels, the percentage of our expected production that we hedge has decreased.

For example, in 2022, we hedged approximately 49% of our natural gas production, and our NGL and oil production was unhedged.

For example, in 2023, we hedged 1% of our natural gas production through fixed swaps , and our NGLs and oil production was unhedged, and as of December 31, 2023, we do not have any fixed swap contracts.

To the extent that we engage in hedging activity in the future, we may be prevented from realizing the near-term benefits of price increases above the levels of the hedges.

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We may incur significant impairment charges in the future, which could have a material adverse effect on our results of operations for the periods in which such charges are taken.

The imbalance between the supply of and demand for oil, natural gas and NGLs at the beginning of the COVID-19 pandemic caused extreme market volatility, increased costs and decreased availability of storage capacity.

Imbalances between the supply of and demand for oil, natural gas and NGLs could cause extreme market volatility, increased costs and decreased availability of storage capacity.

The marketing of our natural gas, NGLs and oil production is substantially dependent upon the existence of adequate markets for our products.

In response to the COVID-19 pandemic, governments tried to slow the spread of the virus by imposing social distancing guidelines, travel restrictions and stay-at-home orders, among other actions, which caused a significant decrease in the demand for oil and to a lesser extent, natural gas and NGLs.

The imbalance between the supply of and demand for these products, as well as the uncertainty around the extent and timing of an economic recovery, caused extreme market volatility and a substantial adverse effect on commodity prices in 2020.

Also, as a result of this imbalance, the industry experienced storage capacity constraints with respect to certain NGL products and oil.

Without sufficient transportation and storage capacity, many producers were forced to temporarily shut in portions of their production or sell portions of their production at below-market prices.

The extent to which the pandemic will impact our business results and operations remains uncertain in light of the rapidly evolving environment, duration and severity of the spread of the virus and emerging variants, effectiveness of vaccine and booster

shots, public acceptance of safety protocols and government measures, including vaccine mandates, designed to slow and contain the spread of COVID-19, among others.

As vaccines have become widely available, social distancing guidelines, travel restrictions and stay-at-home orders have eased, activity in the global economy has increased, demand for oil, natural gas and NGLs and related commodity pricing has improved and storage capacity constraints have subsided.

However, a worsening of the COVID-19 pandemic or other circumstances that could give rise to an imbalance between the supply of and demand for our products could adversely affect our financial condition and results of operations.

Imbalances between the supply of and demand for these products could cause extreme market volatility and a substantial adverse effect on commodity prices during such time.

Such imbalances could also result in the industry experiencing storage capacity constraints with respect to certain NGLs and oil.

Without sufficient transportation and storage capacity, many producers may be forced to temporarily shut in portions of their production or sell portions of their production at below-market prices.

For example, in response to the coronavirus pandemic, governments tried to slow the spread of the virus by imposing social distancing guidelines, travel restrictions and stay-at-home orders, among other actions, which caused a significant decrease in the demand for oil and to a lesser extent, natural gas and NGLs.

We are unable to predict the extent to which another world health event

could impact our business results and operations, but such events could give rise to an imbalance between the supply of and demand for our products that could adversely affect our financial condition and results of operations .

The development of our estimated proved undeveloped reserves may take longer and may require higher levels of capital expenditures than we currently anticipate.

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As of December 31, 2023, 24% of our total estimated proved reserves were classified as proved undeveloped.

Our approximately 4.4 Tcfe of estimated proved undeveloped reserves will require an estimated $1.9 billion of development capital over the next five years.

Our 4.3 Tcfe of estimated proved undeveloped reserves will require an estimated $1.8 billion of development capital over the next five years.

Moreover, the development of probable and possible reserves will require additional capital expenditures and such reserves are less certain to be recovered than proved reserves.

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Our future reserves and production, and therefore, our future cash flow and results of operations are highly dependent on our success in efficiently developing our current reserves and economically finding or acquiring additional recoverable reserves.

We may not be able to develop, find or acquire sufficient additional reserves to replace our current and future production, and any such acquisition and development may be offset by any asset disposition.

We may not be able to develop, find or

acquire sufficient additional reserves to replace our current and future production, and any such acquisition and development may be offset by any asset disposition.

If we are unable to replace our current and future production, the value of our reserves will decrease, and our business, financial condition and results of operations would be adversely affected.

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We have proved undeveloped reserves of 337 Bcfe related to such acreage that is subject to renewal prior to drilling.

In addition, approximately 15% of our natural gas leases related to our Appalachian Basin acreage require us to drill wells that are commercially productive, and if we are unsuccessful in drilling such wells, we could lose our rights under such leases.

In addition, 12% of our natural gas leases related to our Appalachian Basin acreage require us to drill wells that are commercially productive, and if we are unsuccessful in drilling such wells, we could lose our rights under such leases.

Our future oil and gas reserves and production and, therefore, our future cash flow and income are highly dependent on successfully developing our undeveloped leasehold acreage.

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The availability of water recycling facilities and other disposal alternatives to receive all of the water produced from our wells may affect our production.

Our inability to secure sufficient amounts of water, or to dispose of or recycle the water used in our operations, or to timely obtain water sourcing permits or other rights, could adversely impact our operations.

Our inability to secure sufficient amounts

of water, or to dispose of or recycle the water used in our operations, or to timely obtain water sourcing permits or other rights, could adversely impact our operations.

The availability of water may change over time in ways that we cannot control, including as a result of climate change-related effects such as shifting weather patterns.

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Business and Properties—Our Properties and Operations—Undeveloped Acreage Expirations.”

As of December 31, 2022, we had 1,819 identified potential horizontal well locations located in our proved, probable and possible reserve base.

As of December 31, 2023, we had 1,588 identified potential horizontal well locations in our proved, probable and possible reserve base.

As a result of the limitations described above, we may be unable to drill many of our potential well locations.

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Business and Properties—Our Properties and Operations—Estimated Proved Reserves—Identification of Potential Well Locations.”

We may incur losses as a result of title defects in the properties in which we invest.

We may incur losses as a result of title defects or other matters affecting the unitization of interests.

When we acquire oil and gas leases or interests, we typically do not incur the expense of retaining lawyers to examine the title to the mineral interest at the time of acquisition.

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The existence of a material title deficiency can render a lease worthless and can adversely affect our financial condition, results of operations and cash flows.

While we do typically obtain title opinions prior to commencing drilling operations on a lease or in a unit, the failure of title may not be discovered until after a well is drilled, in which case we may lose the lease and the right to produce all or a portion of the minerals under the property.

While we do typically obtain title opinions prior to commencing drilling operations on a lease or in a unit, the failure of title or the right to include certain interests in a unit may not be discovered until after a well is drilled, in which case we may lose the lease and the right to produce all or a portion of the minerals under the property, which may adversely impact our business, financial condition or results of operations.

Legal proceedings brought against us could result in substantial liabilities and materially and adversely impact our financial condition.

Like many oil and gas companies, we are involved in various legal proceedings, including threatened claims, such as contractual, title and royalty disputes.

For example, we are party to pending purported class action litigation that involves claimants’ alleged entitlements to, and accounting for, natural gas royalties, and that could have an impact on the methods for determining the amount of permitted post-production costs and types of cost that may be deducted from royalty payments, among other things.

The cost to settle legal proceedings (asserted or unasserted) or satisfy any resulting unfavorable judgment against us in such proceedings

could result in a substantial liability or the loss of interests, which could materially and adversely impact our cash flows, operating results and financial condition for the period in which any such effect becomes reasonably estimable.

For example, we are party to class action litigation that involves claimants’ alleged entitlements to, and accounting for, natural gas royalties, and that could have an impact on the methods for determining the amount of permitted post-production costs and types of cost that may be deducted from royalty payments, among other things.

The cost to settle legal proceedings (asserted or unasserted) or satisfy any resulting unfavorable judgment against us in such proceedings could result in a substantial liability or the loss of interests, which could materially and adversely impact our cash flows, operating results and financial condition for the period in which any such effect becomes reasonably estimable.

Judgments and estimates to determine accruals or range of losses related to legal proceedings are difficult to predict and could change from one period to the next, and such changes could be material.

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Where this is the case, the allegations and damage theories have not been fully developed, and are all subject to inherent uncertainties.

As a result, management’s view of the likelihood of a material and adverse financial impact from any such proceeding may change in the future.

management’s view of the likelihood of a material and adverse financial impact from any such proceeding may change in the future.

See Note 15—Contingencies to the consolidated financial statements for more information on legal proceedings.

Increased attention to ESG matters and conservation measures may adversely impact our business.

Increasing attention to climate change, societal expectations on companies to address climate change, investor and societal expectations regarding voluntary ESG disclosures and consumer demand for alternative forms of energy may result in increased costs, reduced demand for our products, reduced profits, increased investigations and litigation, negative impacts on our stock price and reduced access to capital markets.

Increasing attention to ESG matters and conservation measures may adversely impact our business.

Increasing attention to climate change, societal expectations on companies to address climate change, investor, regulatory and societal expectations regarding voluntary and mandatory ESG disclosures and consumer demand for alternative forms of energy may result in increased costs, reduced demand for our products, reduced profits, increased investigations and litigation, negative impacts on our stock price and reduced access to capital markets.

Increasing attention to climate change and environmental conservation, for example, may result in demand shifts for oil and natural gas products and additional governmental investigations and private litigation against us.

To the extent that societal pressures or political or other factors are involved, it is possible that such liability could be imposed without regard to our causation of or contribution to the asserted damage, or to other mitigating factors.

To the extent that societal pressures or regulatory or political or other factors are involved, it is possible that such liability could be imposed without regard to our causation of or contribution to the asserted damage, or to other mitigating factors.

Moreover, while we create and publish voluntary disclosures regarding ESG matters from time to time, many of the statements in those voluntary disclosures are based on hypothetical expectations and assumptions that may or may not be representative of current or actual risks or events or forecasts of expected risks or events, including the costs associated therewith.

Such expectations and assumptions are necessarily uncertain and may be prone to error or subject to misinterpretation given the long timelines involved and the lack of an established single approach to identifying, measuring and reporting on many ESG matters.

Mandatory ESG-related disclosure is also emerging as an area where we may be, or may become, subject to required disclosures in certain jurisdictions, depending on our purported nexus to such jurisdictions and any such mandatory disclosures may similarly necessitate the use of hypothetical, projected or estimated data, some of which is not controlled by us and is inherently subject to imprecision.

Disclosures reliant upon such expectations and assumptions are necessarily uncertain and may be prone to error or subject to misinterpretation given the long timelines involved and the lack of an established single approach to identifying, measuring and reporting on many ESG matters.

In addition, we have established a net zero goal by 2025 with respect to our Scope 1 (direct) and Scope 2 (indirect from the purchase of energy) GHG emissions, and we could face unexpected material costs as a result of our efforts to meet this goal and any future revisions to it.

We continue to evaluate a range of technology and other measures, such as carbon offsets, that could assist with meeting this goal.

Given uncertainties related to the use of emerging technologies, the state of markets for and the availability of verified quality carbon offsets, we cannot predict whether or not we will be able to timely meet our net zero goal, if at all.

Moreover, while we may seek to only purchase carbon offsets verified by reputable third-parties, we cannot guarantee that any carbon offsets we purchase will achieve the GHG emission reductions represented, and we could face increased costs to purchase additional carbon offsets to cover any gap or loss, particularly if carbon offset markets face capacity constraints as a result of increased demand.

Given uncertainties related to the use of emerging technologies, the state of markets for and the availability of verified carbon offsets, we cannot predict whether or not we will be able to timely meet these goals, if at all.

In addition, while we may seek to only purchase carbon offsets verified by reputable third parties, we cannot guarantee that any carbon offsets we purchase will achieve the GHG emission reductions represented, and we could face increased costs to purchase additional carbon offsets to cover any gap or loss, particularly if carbon offset markets face capacity constraints as a result of increased demand.

Moreover, certain stakeholders may object to the use of offsets generally or with respect to specific transactions we engage in as to any carbon reduction benefits we may claim resulting from such offsets.

Furthermore, certain jurisdictions, including California, are instituting new laws that require disclosures related to voluntary carbon offsets and similar constructs.

Disclosures under these regimes are novel and it is uncertain whether any disclosures we may make in connection therewith will satisfy the laws and may lead to uncertain consequences, such as private parties criticizing such projects, whether via litigation or otherwise.

While we may participate in various voluntary frameworks and certification programs to improve the ESG profile of our operations and products, we cannot guarantee that such participation or certification will have the intended results on our or our products’ ESG profile.

Also, despite any aspirational goals, we may receive pressure from investors, lenders or other groups to adopt more aggressive climate or other ESG-related goals, but we cannot guarantee that we will be able to implement such goals because of potential costs or technical or operational obstacles.

Furthermore, our reputation, as well as our stakeholder relationships, could be adversely impacted as a result of, among other things, any failure to meet our ESG plans or goals or stakeholder perceptions of statements made by us, our employees and executives, agents, or other third parties or public pressure from investors or policy groups to change our policies.

Such statements with respect to ESG matters are becoming increasingly subject to heightened scrutiny from public and governmental authorities related to the risk of potential “greenwashing,” i.e., misleading information or false claims overstating potential ESG benefits.

As a result, we may face increased litigation risks from private parties and governmental authorities related to our ESG efforts.

Moreover, any alleged claims of greenwashing against us or others in our industry may lead to negative sentiment towards our company or industry.

To the extent that the Company is unable to respond timely and appropriately to any negative publicity, our reputation could be harmed.

Damage to our overall reputation could have a negative impact on our financial results and require additional resources for the Company to rebuild its reputation.

In addition, organizations that provide information to investors on corporate governance and related matters have developed ratings processes for evaluating companies on their approach to ESG matters.

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Unfavorable ESG ratings and recent activism directed at shifting funding away from companies with energy-related assets could lead to increased negative investor sentiment toward us and our industry and to the diversion of investment to other industries, which could have a negative impact on our stock price and our access to and costs of capital.

Also, institutional lenders may decide not to provide funding for oil and natural gas companies based on climate change related concerns, which could affect our access to capital for potential growth projects.

Also, institutional lenders may decide not to provide funding for oil and natural gas companies or the corresponding infrastructure projects based on climate change related concerns, which could affect our access to capital for potential growth projects.

Moreover, to the extent ESG matters negatively impact our reputation, we may not be able to compete as effectively or recruit or retain employees, which may adversely affect our operations.

Such ESG matters may also impact Antero Midstream and our customers, which may adversely impact our business, financial condition or results of operations.

Such ESG matters may also impact Antero Midstream and our

customers, which may adversely impact our business, financial condition or results of operations.

We may incur substantial losses and be subject to substantial liability claims as a result of our operations.

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Our inability to complete a transaction or to achieve our strategic or financial goals in any transaction could have significant adverse effects on our financial position, results of operations and cash flows.

A pandemic, epidemic or outbreak of an infectious disease, such as COVID-19, may materially adversely affect our business.

The global or national outbreak of an infectious disease, such as COVID-19, may cause disruptions to our business and operational plans, which may include (i) shortages of employees, (ii) unavailability of contractors and subcontractors, (iii) interruption of supplies from third-parties upon which we rely, (iv) recommendations of, or restrictions imposed by, government and health authorities, including quarantines, to address the COVID-19 pandemic and (v) restrictions that we and our contractors and subcontractors impose, including facility shutdowns, to ensure the safety of employees and others.

World health events may materially adversely affect our business.

World health events may cause disruptions to our business and operational plans, which may include (i) shortages of employees, (ii) unavailability of contractors and subcontractors, (iii) interruption of supplies from third parties upon which we rely, (iv) recommendations of, or restrictions imposed by, government and health authorities, including quarantines, and (v) restrictions that we and our contractors and subcontractors impose, including facility shutdowns, to ensure the safety of employees and others.

While it is not possible to predict their extent or duration, these disruptions may have a material adverse effect on our business, financial condition and results of operations.

Further, the effects of COVID-19 and concerns regarding its global spread negatively impacted global demand for crude oil and natural gas, which contributed to price volatility, impacted the price we receive for natural gas, NGLs and oil and materially and adversely affected the demand for and marketability of our production, as well as lead to temporary curtailment or shut-ins of production due to lack of downstream demand or storage capacity.

Additionally, to the extent the COVID-19 pandemic adversely affects our business and financial results, it may also have the effect of heightening many of the other risks set forth in this “Item 1A.

Further, the effects of a world health event could negatively impact global demand for crude oil and natural gas, which may contribute to price volatility that could impact the price we receive for natural gas, NGLs and oil and materially and adversely affect the demand for and marketability of our production, as well as lead to temporary curtailment or shut-ins of production due to lack of downstream demand or storage capacity.

Additionally, to the extent a pandemic, epidemic or outbreak of an infectious disease adversely affects our business and financial results, it may also have the effect of heightening many of the other risks set forth in this “Item 1A.

Risk Factors.”

Terrorist attacks, cyberattacks and threats could have a material adverse effect on our business, financial condition or results of operations.

Terrorist attacks, cyberattacks and threats could have a material adverse effect on our business, financial condition and results of operations.

Terrorist attacks or cyberattacks may significantly affect the energy industry, including our operations and those of our suppliers and customers, as well as general economic conditions, consumer confidence and spending and market liquidity.

Cyber incidents, including deliberate attacks, have increased in frequency globally.

Strategic targets, such as energy related assets, may be at greater risk of future attacks than other targets in the United States.

We depend on digital technology in many areas of our business and operations, including, but not limited to, estimating quantities of oil and gas reserves, processing and recording financial and operating data, oversight and analysis of drilling operations, and communications with our employees and third-party customers or service providers.

We also collect and store sensitive data in the ordinary course of our business, including personally identifiable information of our employees as well as our proprietary business information and that of our customers, suppliers, investors and other stakeholders.

We depend on digital technology in many areas of our business and operations, including, but not limited to, estimating quantities of oil and natural gas reserves, processing and recording financial and operating data, oversight and analysis of our drilling, completion and production operations and communications with our employees and third-party customers or service providers.

We also collect and store sensitive data in the ordinary course of our business, including personally identifiable information as well as our proprietary business information and that of our customers, suppliers, investors and other stakeholders.

The secure processing, maintenance and transmission of information is critical to our operations, and we monitor our key information technology systems in an effort to detect and prevent cyberattacks, security breaches or unauthorized access.

Despite our security measures, our information technology systems may undergo cyberattacks or security breaches including as a result of employee error, malfeasance or other threat vectors, which could lead to the corruption or loss of our proprietary and potentially sensitive data, delays in production or delivery of our production to customers, difficulty in completing and settling transactions, challenges in maintaining our books and records, environmental damage, communication interruptions, or other operational disruptions and third-party liabilities.

Moreover, we may not be able to anticipate, detect or prevent all cyberattacks, particularly because the methodologies used by attackers change frequently or may not be recognized until such attack is underway, and because attackers are increasingly using technologies specifically designed to circumvent cybersecurity measures and avoid detection.

Cybersecurity attacks are also becoming more sophisticated and include, but are not limited to, ransomware, credential stuffing, spear phishing, social engineering and other attempts to gain unauthorized access to data for purposes of extortion or other malfeasance.

perform services for our customers;

complete or settle transactions;

maintain our books and records;

prevent environmental damage;

and maintain communications or operations.

Significant liability to the Company or third parties may result.

We are not able to anticipate, detect or prevent all cyberattacks, particularly because the methodologies used by attackers change frequently or may not be recognized until an attack is already underway or significantly thereafter, and because attackers are increasingly using technologies specifically designed to circumvent cybersecurity measures and avoid detection.

Cybersecurity attacks are also becoming more sophisticated and include, but

are not limited to, ransomware, credential stuffing, spear phishing, social engineering, use of deepfakes (e.g., highly realistic synthetic media generated by artificial intelligence) and other attempts to gain unauthorized access to data for purposes of extortion or other malfeasance.

Our information and operational technologies, systems and networks, and those of our vendors, suppliers, customers and other business partners, may become the target of cyberattacks or information security breaches that result in the unauthorized release, gathering, monitoring, misuse, loss or destruction of proprietary and other information, or adversely disrupt our business operations.

Although we have written policies and procedures for monitoring cybersecurity risk and identifying and reporting incidents, there can be no guarantee they will be effective at preventing cyberattacks or ensuring incidents are timely identified or reported.

Advances in computer capabilities, discoveries in the field of artificial intelligence, cryptography, or other developments may result in a compromise or breach of the technology we use to safeguard confidential, personal or other information.

As cyberattacks continue to evolve, we may be required to expend significant additional resources to continue to modify or enhance our protective measures or to investigate and remediate any vulnerabilities to cyberattacks.

In particular, our implementation of various procedures and controls to monitor and mitigate security threats and to increase security for our personnel, information, facilities and infrastructure may result in increased capital and operating costs.

A cyberattack or security breach could result in liability under data privacy laws, regulatory penalties, damage to our reputation or loss of confidence in us, or additional costs for remediation and modification or enhancement of our information systems to prevent future occurrences, all of which could have a material and adverse effect on our business, financial condition or results of operations.

A cyberattack or security breach could result in liability resulting from data privacy or cybersecurity claims, liability under data privacy laws, regulatory penalties, damage to our reputation, long-lasting loss of confidence in us, or additional costs for remediation and modification or enhancement of our information systems to prevent future occurrences, all of which could have a material and adverse effect on our business, financial condition or results of operations.

To date, we have not experienced any material losses relating to cyberattacks;

however, there can be no assurance that we will not suffer such losses in the future.

No security measure is infallible.

Consequently, it is possible that any of these occurrences, or a combination of them, could have a material adverse effect on our business, financial condition and results of operations.

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We are also subject to credit risk due to concentration of receivables with several significant customers.

The largest purchaser of our products during the year ended December 31, 2022 accounted for approximately 12% of our product revenues.

The largest purchaser of our products during the year ended December 31, 2023 accounted for 9% of our product revenues.

We do not require all of our customers to post collateral.

The inability or failure of our significant customers to meet their obligations to us or their insolvency or liquidation may adversely affect our financial results.

Our hedging transactions may become more costly or unavailable to us and expose us to counterparty credit risk.

Derivative arrangements could limit the benefit we would receive from increases in the prices for natural gas, NGLs and oil, which could also have an adverse effect on our financial condition.

Hedging transactions may become more costly or unavailable to us and expose us to counterparty credit risk.

To the extent that we engage in hedging activity in the future, derivative arrangements could limit the benefit we would receive from increases in the prices for natural gas, NGLs and oil, which could also have an adverse effect on our financial condition.

If natural gas, NGLs or oil prices upon settlement of our derivative contracts exceed the price at which we have hedged our commodities, we will be obligated to make cash payments to our hedge counterparties, which could, in certain circumstances, be significant.

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regulators adopted a final rule in November 2019 implementing a new approach for calculating the exposure amount of derivative contracts under the applicable agencies’ regulatory capital rules, referred to as the standardized approach for counterparty credit risk (“SA-CCR”).

As adopted, certain financial institutions are required to comply with the new SA-CCR rules

beginning on January 1, 2022.

As adopted, certain financial institutions are required to comply with the new SA-CCR rules beginning on January 1, 2022.

These rules could significantly increase the capital requirements for certain participants in the over-the-counter derivatives market in which we participate.

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Transportation rates on FERC-regulated pipelines are subject to change, and depending on the amount of any increase, such an increase in rates could have an adverse effect on our results of operations.

As of December 31, 2022, our long- term contractual obligations under agreements with minimum volume commitments totaled approximately $11.1 billion over the term of the contracts.

If we have insufficient production to meet the minimum volumes or are otherwise unable to fulfill all or a portion of our volume commitments, our cash flow from operations will be reduced, which may require us to reduce or delay our planned investments and capital expenditures or seek alternative means of financing, all of which may have a material adverse effect on our results of operations.

As of December 31, 2023, our long- term contractual obligations under agreements with minimum volume commitments totaled $10.4 billion over the term of the contracts.

capital expenditures or seek alternative means of financing, all of which may have a material adverse effect on our results of operations.

Assuming 2024 production is unchanged from 2023 production, we estimate that we will incur annual net marketing costs of $0.05 per Mcfe to $0.07 per Mcfe in 2024 for unutilized transportation capacity depending on the amount of unutilized capacity that can be marketed to third parties or utilized to transport third-party gas and capture positive basis differentials.

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Interruptions in operations at facilities that process and fractionate our gas, or with pipelines or other facilities that transport or handle our gas, may adversely affect our business, financial condition and results of operations.

We have agreements with processing and fractionation facilities, including those owned by MPLX, LP and the Joint Venture, to accommodate our current operations as well as future development plans In addition, we have gathering, compression, transportation and similar agreements with third-parties to accommodate our current operations as well as future development plans.

We have agreements with processing and fractionation facilities, including those owned by MPLX, LP and the Joint Venture, to accommodate our current operations as well as future development plans.

In addition, we have gathering, compression, transportation and similar agreements with third parties to accommodate our current operations as well as future development plans.

Any significant interruptions at these facilities or pipelines could cause us to curtail our future development and production plans, which could adversely affect our business, financial condition and results of operations.

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● damage to the facilities resulting from NGLs that do not comply with applicable specifications;

● inadequate fractionation capacity or market access to support production volumes, including lack of availability of rail cars, barges, trucks and pipeline capacity, or market constraints, including reduced demand or limited markets for certain NGL products;

● terrorist attacks or cyberattacks.

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We often are not entitled to contractual indemnification for environmental liabilities and acquire properties on an “as is” basis.

Even if we are able to obtain contractual indemnification rights, there is no assurance that the seller will be capable of performing under any indemnification obligation.

We may be unable to make attractive acquisitions or successfully integrate acquired businesses, and any inability to do so may disrupt our business.

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● provide that, subject to the rights of holders of any series of preferred stock to elect directors or fill vacancies in respect of such directors as specified in the related preferred stock designation, all vacancies, including newly created directorships be filled by the affirmative vote of holders of a majority of directors then in office, even if less than a quorum, or by the sole remaining director, and will not be filled by our stockholders;

annual or special meeting of our stockholders and may not be effected by any consent in writing in lieu of a meeting of such stockholders;

● provide that, subject to the rights of the holders of any series of preferred stock to elect directors under specified circumstances, if any, any action required or permitted to be taken by our stockholders must be effected at a duly called annual or special meeting of our stockholders and may not be effected by any consent in writing in lieu of a meeting of such stockholders;

● provide for our Board of Directors to be divided into three classes of directors, with each class as nearly equal in number as possible, serving staggered three-year terms;

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Provisions of our 2026 Convertible Notes could delay or prevent an otherwise beneficial takeover of us.

Certain provisions of our 2026 Convertible Notes (as defined herein) and the indenture governing such notes could make a third-party attempt to acquire us more difficult or expensive.

Certain provisions of our 2026 Convertible Notes and the indenture governing such notes could make a third party attempt to acquire us more difficult or expensive.

For example, if a takeover constitutes a “Fundamental Change” (as defined in the indenture governing such notes), then holders of our 2026 Convertible Notes will have the right to require us to repurchase their 2026 Convertible Notes for cash.

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Various factors could materially affect our ability to dispose of assets if and when we decide to do so, including the availability of purchasers willing to purchase the assets at prices acceptable to us, particularly in times of reduced and volatile commodity prices.

In connection with certain dispositions, we may be required to contractually indemnify the purchaser or retain liabilities for certain matters.

Capital Structure and Access to Capital

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We make, and expect to continue to make, substantial capital expenditures for the exploration, development, production, and acquisition of oil and gas reserves.

Our cash flow used in investing activities related to drilling, completions and land expenditures was approximately $944 million in 2022.

Our net capital budget for 2023 is $1.025 billion to $1.075 billion.

Our cash flow used in investing activities for 2023

included drilling and completion costs of $964 million and leasehold expenditures of $151 million.

Our net capital budget for 2024 is $725 million to $800 million.

Our budget includes:

a range of $875 million to $925 million for drilling and completion and $150 million for leasehold expenditures.

a range of $650 million to $700 million for drilling and completion and $75 million to $100 million for leasehold expenditures.

Our capital budget excludes acquisitions, except for leasehold acquisitions.

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In addition, any failure to make payments of interest and principal on our outstanding indebtedness on a timely basis would likely result in a reduction of our credit rating, which could harm our ability to incur additional indebtedness and may result in us having to post collateral with, or provide letters of credit to, certain transactional counterparties.

In the absence of sufficient cash flows and capital resources, we could face substantial liquidity problems and might be required to dispose of material assets or operations to meet our debt service and other obligations.

In the absence of sufficient cash flows and capital resources, we could face substantial liquidity problems and might be required to dispose of material

assets or operations to meet our debt service and other obligations.

The Credit Facility and the indentures governing our Senior Notes and our 2026 Convertible Notes place certain restrictions on our ability to dispose of assets and our use of the proceeds from such disposition.

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Our development plan may require access to the capital and credit markets.

Although the market for high-yield debt securities improved in 2021 and 2022, as compared to 2020, if the high-yield market deteriorates, or if we are unable to access alternative means of debt or equity financing on acceptable terms or at all, we may be unable to implement our development plan or otherwise carry out our business plan, which could have a material adverse effect on our financial condition and results of operations and impair our ability to service our indebtedness.

Although the market for high-yield debt securities has improved compared to 2020, if the high-yield market deteriorates, or if we are unable to access alternative means of debt or equity financing on acceptable terms or at all, we may be unable to implement our development plan or otherwise carry out our business plan, which could have a material adverse effect on our financial condition and results of operations and impair our ability to service our indebtedness.

Restrictions in our existing and future debt agreements could limit our growth and our ability to engage in certain activities.

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In addition, the Credit Facility requires us to maintain certain financial ratios or to reduce our indebtedness if we are unable to comply with such ratios.

These restrictions, together with those in the indentures governing our senior notes and our 2026 Convertible Notes, may also limit our ability to obtain future financings to withstand a future downturn in our business or the economy in general, or to otherwise conduct necessary corporate activities.

These restrictions,

together with those in the indentures governing our Senior Notes and our 2026 Convertible Notes, may also limit our ability to obtain future financings to withstand a future downturn in our business or the economy in general, or to otherwise conduct necessary corporate activities.

We may also be prevented from taking advantage of business opportunities that arise because of the limitations that the restrictive covenants under the indentures governing our Senior Notes and 2026 Convertible Notes, and the Credit Facility impose on us.

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These changes could cause our cost of doing business to increase, limit our ability to pursue acquisition opportunities, reduce cash flow used for drilling and place us at a competitive disadvantage.

For example, during

2022, we had estimated average outstanding borrowings under the Credit Facility of approximately $238 million, and the impact of a 1.0% increase in interest rates on this amount of indebtedness would result in increased interest expense for that period of approximately $2 million and a corresponding decrease in our cash flows and net income before the effects of income taxes.

For example, during 2023, we had average outstanding borrowings under the Credit Facility of $342 million, and the impact of a 1.0% increase in interest rates on this amount of indebtedness would result in increased interest expense for that period of $3 million and a corresponding decrease in our cash flows and net income before the effects of income taxes.

Furthermore, a downgrade to our credit rating would trigger certain obligations to deliver letters of credit to certain transactional counterparties, which would adversely impact our available liquidity.

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Should we fail to comply with all applicable FERC administered statutes, rules, regulations and orders, we could be subject to substantial penalties and fines.

Under the EPAct of 2005, FERC has civil penalty authority under the NGA to impose penalties for current violations of up to approximately $1,496,035 per day for each violation and disgorgement of profits associated with any violation.

Under the EPAct of 2005, FERC has civil penalty authority under the NGA to impose penalties for current violations of up to $1,544,521 per day for each violation and disgorgement of profits associated with any violation.

While our systems have not been regulated by FERC under the NGA, FERC has adopted regulations that may subject certain of our otherwise non- FERC jurisdictional facilities to FERC annual reporting requirements.

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However, President Biden has highlighted addressing climate change as a priority of his administration, which includes certain potential initiatives for climate change legislation to be proposed and passed into law.

Moreover, federal regulators, state and local governments, and private parties have taken (or announced that they plan to take) actions that have or may have a significant influence on our operations.

Moreover, federal regulators, state and local governments, and private parties

have taken (or announced that they plan to take) actions that have or may have a significant influence on our operations.

For example, in response to findings that emissions of carbon dioxide, methane and other GHGs endanger public health and the environment, the EPA has adopted regulations under existing provisions of the federal Clean Air Act that, among other things, establish PSD construction and Title V operating permit reviews for certain large stationary sources that are already potential major sources of certain principal, or criteria, pollutant emissions.

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Congress approved, and President Biden has signed into law, a resolution under the Congressional Review Act to repeal the September 2020 revisions to the methane standards, effectively reinstating the prior standards.

In response to President Biden’s executive order, in November 2021, the EPA issued a proposed rule that, if finalized, would establish Quad Ob new source and Quad Oc first-time existing source standards of performance for methane and VOC emissions for the crude oil and natural gas source category.

Owners or operators of affected emission units or processes would have to comply with specific standards of performance that may include leak detecting using optical gas imaging and subsequent repair requirements, reduction of regulated emissions through capture and control systems, zero-emission requirements for certain equipment or processes and operations and maintenance requirements.

In November 2022, the EPA published a supplemental proposal which, among other items, would impose expanded

inspection, monitoring and emissions control requirement on oil and gas sites, as well as strengthen requirements related to emissions from equipment and routine flaring.

The proposal would also establish a “Super Emitter Response Program” that would require operator response to emissions events exceeding 200 pounds per hour, as detected by regulatory authorities or qualified third-parties.

The proposal is currently subject to public comment and is expected to be finalized in 2023.

Separately, certain provisions of the IRA 2022 address methane regulation by imposing the first federal fee on excess methane emissions.

As a result, we cannot predict the scope of any final methane regulatory requirements or the cost to comply with such requirements.

In response to President Biden's executive order calling on the EPA to revisit federal regulations regarding methane, the EPA finalized more stringent methane rules for new, modified, and reconstructed facilities, known as OOOOb, as well as standards for existing sources for the first time ever, known as OOOOc, in December 2023.

Under the final rules, states have two years to prepare and submit their plans to impose methane emission controls on existing sources.

The presumptive standards established under the final rule are generally the same for both new and existing sources.

The requirements include enhanced leak detection survey requirements using optical gas imaging and other advanced monitoring to encourage the deployment of innovative technologies to detect and reduce methane emissions, reduction of emissions by 95% through capture and control systems and zero-emission requirements for certain devices.

The rule also establishes a “super emitter” response program that would allow third parties to make reports to EPA of large methane emission events, triggering certain investigation and repair requirements.

Fines and penalties for violations of these rules can be substantial.

It is likely, however, that the final rule and its requirements will be subject to legal challenges.

Moreover, compliance with the new rules may affect the amount we owe under the IRA 2022’s methane fee described above because compliance with EPA’s methane rules would exempt an otherwise covered facility from the requirement to pay the methane fee.

The requirements of the EPA’s final methane rules have the potential to increase our operating costs and thus may adversely affect our financial results and cash flows.

Moreover, failure to comply with these CAA requirements can result in the imposition of substantial fines and penalties as well as costly injunctive relief.

Given the long-term trend toward increasing regulation, future federal GHG regulations of the oil and gas industry remain a possibility, and several states, including West Virginia and Ohio, have separately imposed or are considering imposing their own regulations on methane emissions from oil and gas production activities.

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President Biden has recommitted the United States to the Paris Agreement and, in April 2021, announced a goal of reducing the United States’ emissions by 50-52% below 2005 levels by 2030.

In November 2021, the international community gathered again in Glasgow at the 26 th Conference to the Parties on the UN Framework Convention on Climate Change (“COP26”), during which multiple announcements were made, including a call for parties to eliminate certain oil and natural gas subsidies and pursue further action on non-CO2 GHGs.

In November 2021, the international community gathered again in COP26, during which multiple announcements were made, including a call for parties to eliminate certain oil and natural gas subsidies and pursue further action on non-CO2 GHGs.

These goals were reaffirmed at COP27 in November 2022.

Relatedly, the United States and European Union jointly announced the launch of the “Global Methane Pledge,” which aims to cut global methane pollution at least 30% by 2030 relative to 2020 levels, including “all feasible reductions” in the energy sector.

The impacts of these orders, pledges, agreements and any legislation or regulation promulgated to fulfill the United States’ commitments under the Paris Agreement, COP26 or other international conventions cannot be predicted at this time.

At COP28 in December 2023, the parties signed onto an agreement to transition away from fossil fuels in energy systems and increase renewable energy capacity, though no timeline for doing so was set.

While non-binding, the agreements coming out of COP28 could result in increased pressure among financial institutions and various stakeholders to reduce or otherwise impose more stringent limitations on funding for and increase potential opposition to the exploration and production of fossil fuels.

The impacts of these orders, pledges, agreements and any legislation or regulation promulgated to fulfill the United States’ commitments under the Paris Agreement, COP26, COP28 or other international conventions cannot be predicted at this time.

Concern over the threat of climate change has also resulted in increasing political risks in the United States, including climate-change related pledges made by President Biden and other public office representatives.

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and reducing non-CO2 GHG emissions, such as methane and nitrous oxide.

Other actions that could be pursued include more restrictive requirements for the development of pipeline infrastructure or LNG export facilities, as well as more restrictive GHG emissions limitations for oil and gas facilities.

Other actions that could be pursued include more restrictive requirements for the development of pipeline infrastructure or LNG

export facilities, as well as more restrictive GHG emissions limitations for oil and gas facilities.

For example, on January 26, 2024, President Biden announced a temporary pause on pending decisions on new exports of LNG to countries that the United States does not have free trade agreements with, pending Department of Energy review of the underlying analyses for authorization.

The pause is intended to provide time to integrate certain considerations, including potential energy cost increases for consumers and manufacturers and the latest assessment of the impact of GHG emissions, and to ensure adequate guards against health risks are in place.

Increasingly, oil and natural gas companies are exposed to litigation risks associated with the threat of climate change.

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In addition, the SEC has proposed a rule requiring registrants to include certain climate-related disclosures, including Scope 1, 2 and 3 GHG emissions, climate-related targets and goals, and certain climate-related financial statement metrics, in registration statements and periodic reports.

The final rule is expected in 2023, and we

cannot predict the final form and substance of the rule.

To the extent the rules impose additional reporting obligations, we could face increased costs, or restrictions or limitations on our access to capital.

Separately, the SEC has also announced that is scrutinizing existing climate-change related disclosures in public filings, increasing the potential for enforcement if the SEC were to allege an issuer’s existing climate disclosures misleading or deficient .

The final rule is expected in 2024, and we cannot predict the final form and substance of the rule.

Similarly, in October 2023, the Governor of California signed the CCDAA and CRFRA into law.

The CCDAA requires both public and private U.S.

companies that are “doing business in California” and that have a total annual revenue of $1 billion to publicly disclose and verify, on an annual basis, Scope 1, 2 and 3 GHG emissions.

The CRFRA requires the disclosure of a climate-related financial risk report (in line with the TCFD recommendations or equivalent disclosure requirements under the ISSB climate-relate disclosure standards) every other year for public and private companies that are “doing business in California” and have total annual revenue of at least $500 million.

Reporting under both laws would begin in 2026.

Currently, the ultimate impact of these laws on our business is uncertain.

The Governor of California has directed further consideration of the implementation deadlines for each of the laws, and there is potential for legal challenges to be filed with respect to the scope of the law, but, absent clarification or revisions to the law, alongside the SEC proposed rule, finalization and implementation may result in additional costs to comply with these disclosure requirements as well as increased costs of and restrictions on access to capital.

Separately, enhanced climate related disclosure requirements could lead to reputational or other harm with customers, regulators, investors or other stakeholders and could also increase our litigation risks relating to statements alleged to have been made by us or others in our industry regarding climate change risks, or in connection with any future disclosures we may make regarding reported emissions, particularly given the inherent uncertainties and estimations with respect to calculating and reporting GHG emissions.

Separately, the SEC has also from time to time applied additional scrutiny to existing climate-change related disclosures in public filings, increasing the potential for enforcement if the SEC were to allege an issuer’s existing climate disclosures misleading or deficient .

The adoption and implementation of new or more stringent international, federal or state legislation, regulations or other regulatory initiatives related to climate change or GHG emissions from oil and natural gas facilities could result in increased costs of compliance or costs of consumption, thereby reducing demand for our products.

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Conflicts of interest will arise between Antero Midstream and us.

Our directors and officers who are also directors and officers of Antero Midstream have a fiduciary duty to manage Antero Midstream in a manner that is beneficial to Antero Midstream.

Our directors and officers who are also directors and officers of Antero Midstream have a

fiduciary duty to manage Antero Midstream in a manner that is beneficial to Antero Midstream.

In resolving these actual or apparent conflicts of interest, these directors and officers may choose strategies that favor Antero Midstream over our interests and the interests of our stockholders.

The resolution of any conflicts of interest between Antero Midstream and its subsidiaries, on one hand, and us and our subsidiaries, on the other, to the extent we can resolve them, may be costly and reduce the amount of time and attention that our directors and officers may spend in operating our business, which, in each case, may adversely affect our business.

Our future tax liability may be greater than expected if our net operating loss (“NOL”) carryforwards are limited, we do not generate expected deductions, or tax authorities challenge certain of our tax positions.

Our future tax liabilities may be greater than expected if our net operating loss (“NOL”) carryforwards are limited, we do not generate expected deductions, or tax authorities challenge our tax positions.

As of December 31, 2023, we have U.S.

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federal NOL carryforwards expire in 2037 while others have no expiration date.

If commodity prices in 2023 are similar to those experienced in 2022, we would expect to fully utilize our U.S.

federal NOL carryforwards in 2023.

We expect to fully utilize our U.S.

federal NOL carryforwards prior to expiration.

The state NOL carryforwards expire at various dates from 2025 to 2041.

We do not expect to be able to utilize certain of these NOL carryforwards due to changes in state tax law.

Therefore, the Company has placed a valuation allowance against $1.5 billion of these state NOL carryforwards.

We do not expect to utilize certain of these NOL carryforwards due to changes in state tax law.

Therefore, we have placed a valuation allowance against $1.5 billion of these state NOL carryforwards.

These expectations are based upon assumptions we have made regarding, among other things, our income, capital expenditures and net working capital, and upon our NOL carryforwards not becoming subject to future limitation under Section 382 of the Internal Revenue Code of 1986, as amended (“Section 382”), or otherwise.

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Any unused annual limitation may be carried over to later years.

Any limitation on our ability to utilize our NOL carryforwards against income or gain we generate in the future could result in future income tax expense that could adversely affect our operating results and cash flows.

Furthermore, any significant variance in our interpretation of current income tax laws, including as result of the release of final Treasury Regulations or other interpretive guidance implementing the Tax Cuts and Jobs Act or the IRA 2022, or a challenge of one or more of our tax positions by the IRS or other tax authorities, could affect our tax position.

Any limitation on our ability to utilize our NOL carryforwards against income or gain we generate in the future could increase our future tax liabilities and adversely affect our operating results and cash flows.

Furthermore, we are subject to various complex and evolving U.S.

federal, state and local tax laws.

federal, state and local tax laws, policies, statutes, rules, regulations or ordinances could be interpreted, changed, modified or applies adversely to us, in each case, possibly with retroactive effect.

Any significant variance in our interpretation of current tax laws, including as result of the release of final Treasury Regulations or other interpretive guidance implementing the Tax Cuts and Jobs Act or the IRA 2022, or a successful challenge of one or more of our tax positions by the IRS or other state or local tax authorities could increase our future tax liabilities and adversely affect our operating results and cash flows.

While we expect to be able to (i) utilize all of our U.S.

federal NOL carryforwards, (ii) utilize a portion of our state NOL carryforwards and (iii) generate deductions to offset a portion of our future taxable income, in the event that deductions are not generated as expected, one or more of our tax positions are successfully challenged by the IRS (in a tax audit or otherwise), or our NOL carryforwards are subject to future limitation (including due to an ownership change under Section 382), our future tax liability may be greater than expected.

Changes in tax laws or the interpretation thereof or the imposition of new or increased taxes or fees may increase our future tax liability and adversely affect our operations and cash flows.

federal NOL carryforwards, (ii) utilize a portion of our state NOL carryforwards and (iii) generate deductions to offset a portion of our future taxable income, in the event that our NOL carryforwards are subject to future limitation (including due to an ownership change under Section 382), deductions are not generated as expected, or if one or more of our tax positions are successfully challenged by the IRS or other tax authorities (in a tax audit or otherwise), our future tax liabilities may be greater than expected, which could adversely affect our operating results and cash flows.

Changes in tax laws or the interpretation thereof or the imposition of new or increased taxes or fees may increase our future tax liabilities and adversely affect our operating results and cash flows.

From time to time, U.S.

federal and state level legislation has been proposed that would, if enacted into law, make significant changes to tax laws, including to certain key U.S.

federal and state income tax provisions currently available to natural gas and oil exploration and development companies.

federal and state income tax provisions currently applicable to natural gas and oil exploration and development companies.

Such proposed legislative changes include, but are not limited to, (i) the elimination of the percentage depletion allowance for oil and natural gas properties, (ii) the elimination of current deductions for intangible drilling and development costs, (iii) an extension of the amortization period for certain geological and geophysical expenditures, (iv) the elimination of certain other tax deductions and relief previously available to oil and natural gas companies and (v) an increase in the U.S.

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Additionally, states in which we operate or own assets may impose new or increased taxes or fees on natural gas and oil extraction.

The passage of any legislation as a result of these proposals and other similar changes in U.S.

federal income tax laws or the imposition of new or increased taxes or fees on natural gas and oil extraction could increase our future tax liability and adversely affect our operations and cash flows.

The passage of any legislation as a result of these proposals and other changes in tax laws or the imposition of new or increased taxes or fees on natural gas and oil extraction could increase our future tax liabilities and adversely affect our operating results and cash flows.

In addition, the IRA 2022 includes, among other things, a corporate alternative minimum tax (the “CAMT”).

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A corporation is generally an applicable corporation subject to CAMT in any taxable year following a taxable year in which the “average annual adjusted financial statement income” of the corporation and certain of its subsidiaries and affiliates exceeds $1 billion for a specified three taxable year period.

We will not be an applicable corporation subject to CAMT in 2023.

Based on current commodity pricing, our interpretation of the CAMT and the IRA 2022 and a number of operational, economic, accounting and regulatory assumptions, we could become an applicable corporation subject to CAMT in 2025.

We were not an applicable corporation subject to CAMT in 2023.

Based on current commodity pricing, our interpretation of the CAMT and the IRA 2022 and a number of operational, economic, accounting and regulatory assumptions, we do not expect to become an applicable corporation subject to CAMT in the next three years.

If we become an applicable corporation and our CAMT liability is greater than our regular U.S.

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The IRA 2022 also imposes a 1% non-deductible excise tax on the fair market value of any stock repurchased by a publicly traded domestic corporation during any taxable year, with the fair market value of such repurchased stock reduced by the fair market value of certain stock issued by such corporation during such taxable year (such excise tax, the “Stock Buyback Tax”).

The Stock Buyback Tax will apply to our share repurchase program beginning in 2023.

The Biden Administration has proposed increasing the amount of the Stock Buyback Tax from 1% to 4%;

however, it is unclear whether such a change in the amount of the excise tax will be enacted and, if enacted, how soon any such change could take effect.

The Stock Buyback Tax first applied to our authorized share repurchase program in the year ended December 31, 2023, and will continue to apply in subsequent taxable years.

Department of the Treasury and the Internal Revenue Service are expected to release regulations and interpretive guidance relating to the CAMT and the Stock Buyback Tax, and any significant variance from our current interpretation could result in a change in our analysis of the application of the CAMT and the Stock Buyback Tax to us and its impact on our operations and cash flows.

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In addition, the existence of the 2026 Convertible Notes may encourage short selling by market participants because the conversion of the 2026 Convertible Notes could be used to satisfy short positions, or anticipated conversion of the 2026 Convertible Notes into shares of our common stock could depress the price of our common stock.

Any of these events may dilute the ownership interests of our stockholders, reduce our earnings per share or have an adverse effect on the price of shares of our common stock.

Any of these events may dilute the ownership interests of our stockholders, reduce our net income per share or have an adverse effect on the price of shares of our common stock.

Our certificate of incorporation designates the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders' ability to obtain a favorable judicial forum for disputes with us or our directors, officers, employees or agents.

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We may issue preferred stock, which may have terms that could adversely affect the voting power or value of our common stock.

Our certificate of incorporation authorizes our Board of Directors to issue, without the approval of our stockholders, one or more classes or series of preferred stock having such designations, preferences, limitations and relative rights, including preferences

over our common stock respecting dividends and distributions, as our Board of Directors may determine.

The terms of one or more classes or series of our preferred stock could adversely impact the voting power or value of our common stock.

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Similarly, the repurchase or redemption rights or liquidation preferences we might assign to holders of our preferred stock could affect the residual value of our common stock.

UNRESOLVED STAFF COMMENTS

Not applicable.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors