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Item 1. Business

2022-03-10 compared with 2021-02-26 · 160 added, 118 removed, 334 unchanged (45% of the section changed)

We are a leading global information services and analytics company serving the scientific research, intellectual property and life sciences end-markets.

We provide structured information and analytics to facilitate the discovery, protection and commercialization of scientific research, innovations and brands.

Our product portfolio includes well-established, market-leading brands such as Web of Science, Derwent, Cortellis, DRG, CompuMark, MarkMonitor and CPA Global.

We believe that our flagship products hold a #1 or #2 global position by revenues across the respective markets they serve, including abstracting and indexing databases, life science regulatory and competitive intelligence and intellectual property protection (including patent, trademarks and domain and brand protection).

We are a leading global information, analytics and workflow solutions company serving the Academia & Government, Life Sciences & Healthcare, Professional Services and Consumer Goods, Manufacturing & Technology end-markets.

We provide structured information and insights to facilitate the discovery, protection, management and commercialization of scientific research, inventions and brands.

Our product portfolio includes well-established, market-leading products such as Web of Science, Derwent, Cortellis, DRG, CompuMark, MarkMonitor, CPA Global and ProQuest.

We serve a large, diverse and global customer base.

As of December 31, 2020, we served over 30,000 customers in more than 170 countries, including the top 30 pharmaceutical companies by revenues.

As of December 31, 2021, we served over 50,000 customers in approximately 180 countries, including the top 30 pharmaceutical companies.

We believe that the strong value proposition of our content, user interfaces, visualization and analytical tools, combined with the integration of our products and services into customers’ daily workflows, leads to our substantial customer loyalty as evidenced by their high propensity to renew their subscriptions with us.

Corporations, government agencies, universities, law firms and other professional services organizations around the world depend on our high-value, curated content, analytics and services.

Corporations, government agencies, universities, researchers, law firms and other professional services organizations around the world depend on our high-value, curated information, analytics and services.

Unstructured data has grown exponentially over the last decade.

This trend has resulted in a critical need for unstructured data to be meaningfully filtered, analyzed and curated into relevant information that facilitates key operational and strategic decisions made by businesses, academic institutions and governments worldwide.

Our highly curated, proprietary information created through our sourcing, aggregation, verification, translation and categorization of data has resulted in our solutions being embedded in our customers’ workflow and decision-making processes.

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We generated recurring revenues through our subscription-based model and re-occurring revenue transactions, which accounted for 79.1% of our revenues for the year ended December 31, 2021.

In each of the past three years, we have also achieved annual revenue renewal rates in excess of 90%.

In each of the past three years, we have also achieved annual revenue renewal rates in excess of 90% and our ten largest customers represented only 9% of revenues for the year ended December 31, 2021.

(For information on annual revenue renewal rates, see Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - Key Performance Indicators - Annual Revenue Renewal Rates.) No single customer accounted for more than 1% of revenues and our ten largest customers represented only 6% of revenues for the year ended December 31, 2020.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - Key Performance Indicators - Annual Revenue Renewal Rates).

The following charts illustrate our revenues for the year ended December 31, 2021 by group, type and geography:

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Science Segment (48% of revenues for the year ended December 31, 2021)

Our Science segment consists of our Academic and Life Science Product Lines.

Both provide curated, high-value, structured information that is delivered and embedded into the workflows of our customers, which include research intensive corporations, life science and healthcare organizations and universities world-wide.

Our Science segment consists of our Academia & Government and Life Sciences & Healthcare Product Lines.

Our product portfolio for our Science segment is summarized below.

Product Line Academic Life Sciences

Product Line Academia & Government Life Sciences & Healthcare

Product Description Used to navigate scientific and academic research discoveries, conduct analysis and evaluate research impact Used by life sciences and healthcare firms for drug research and medical device research

Curated Information Set Database of 1.9B+ citations, 176mm+ index records

Curated Information Set Database of 2.1B+ citations, 187mm+ indexed records

84,000+ drug program records, 495,000 clinical trial records

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Notable Products and Offerings Web of Science

ScholarOne Cortellis Drug Discovery Intelligence (formerly Integrity)

Cortellis Generic Intelligence (formerly Newport)

Academic Product Line

Our Academic Product Line (“APL”) provides products and services to organizations that plan, fund, implement and utilize research.

ProQuest Central and eBook Central Cortellis Competitive Intelligence

Cortellis Regulatory Intelligence

Cortellis Drug Discovery Intelligence

Cortellis Generic Intelligence

Academia & Government Product Line

Our Academia & Government Product Line (“AGPL”) provides products and services to organizations that plan, fund, implement and utilize research.

We deliver search and discovery services to researchers with proprietary scientific data;

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and we inform a wide range of sector specific consultation and reporting activities to national and institutional research agencies across the G20 countries.

We believe that the high quality and unique nature of APL’s products and the informed approach of our professional service expertise have resulted in our information, services and workflow tools becoming embedded within the fabric of the research community.

Key products include Web of Science, InCites, Journal Citation Reports, EndNote, ScholarOne, Converis, and Publons.

We believe that the high quality and unique nature of AGPL’s products and the informed approach of our professional service expertise have resulted in our information, services and workflow tools becoming embedded within the fabric of the research community.

Key products include Web of Science, InCites, Journal Citation Reports, EndNote, ScholarOne, Converis, Publons, Alma, ProQuest Central, and eBook Central.

Web of Science (“WOS”), our flagship product, holds a unique and pivotal role in the infrastructure of R&D and is frequently utilized as a reference standard in the academic, institutional and corporate sectors.

It provides publication records and essential metadata from trusted published assets and is linked and indexed together via over 1.9 billion tracked citations from over 176 million index records going back to 1900 within the core Web of Science, and back to 1864 in Zoological Record.

It provides publication records and essential metadata from trusted published assets and is linked and indexed together via over 2.1 billion tracked citations from over 187 million indexed records going back to 1900 within the Web of Science Core, and back to 1864 in Zoological Record.

A key metric we provide is the “Journal Impact Factor” (“JIF”), which we believe is the most influential and best-known research metric of the last 50 years.

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• A university provost interested in evaluating her university’s chemistry department accesses WOS and our analytical tool InCites to measure the strength of the university’s research output and benchmark it against comparable institutions and find the best researchers to bolster the university’s ranking and improve the caliber of research, and find highly cited researchers, departments and laboratories.

Life Sciences Product Line

Our Life Sciences Product Line (“LSPL”) provides products and services primarily to pharmaceutical, healthcare and biotechnology companies.

These Product Lines help manage customer’s intellectual property throughout their product development lifecycle.

Life Sciences & Healthcare Product Line

Our Life Sciences & Healthcare Product Line (“LSHPL”) provides products and services primarily to pharmaceutical, healthcare and biotechnology companies.

We believe we provide a unique end-to-end proposition, which links to early research workflows, and believe there is an opportunity to stretch further into the approval and post-approval phases of drug development.

Key products include Cortellis research Intelligence, Cortellis Generics Intelligence, and DRG.

Cortellis, our flagship LSPL product, is used by strategy, business development, drug development, medical affairs and clinical professionals at pharmaceutical and biotechnology companies to support research, market intelligence and competitive monitoring in connection with the development and commercialization of new drugs.

Cortellis, our flagship LSHPL product, is used by strategy, business development, drug development, medical affairs and clinical professionals at pharmaceutical and biotechnology companies to support research, market intelligence and competitive monitoring in connection with the development and commercialization of new drugs.

Our customers use the database to access and evaluate scientific data, drug pipeline data, clinical trial information, drug monographs, pharmaceutical M&A data and regulatory information, all of which have been aggregated, curated and classified by our team of scientific experts who evaluate and select data for inclusion in the database from a wide array of sources.

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Our product portfolio for our Intellectual Property segment is summarized below.

Product Line Patents Trademarks Domains IP

Product Line Patent Trademark Domain IP Management

Product Description Used to search and analyze patents Used to monitor trademarks on an ongoing basis Used to register and manage portions of web domains Used for renewal and validation of intellectual property rights on behalf of customers

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Customers Used by 50+ patent offices, large R&D organizations of Fortune 1000 companies and various universities

65 industrial databases, 70 Pharma in-use databases MarkMonitor manages 38% of the top 50 most trafficked corporate website domain portfolios

65 industrial databases, 70 Pharma in-use databases Manages 46% of the top 50 most trafficked corporate website domain portfolios

12,000 direct and indirect customers including 47 out of 50 top R&D spenders globally

Notable Products and Offerings Derwent

IncoPat Compmark Watch

IncoPat Compumark Watch

Compumark Saegis

Compumark Search MarkMonitor

Domain Management

Brand Protection CPA Global

Renewals, Filing and Prosecution, Patent Search and IPMS Solutions

Patents Product Line

Our Patents Product Line (“PPL”) enables customers to evaluate the novelty of potential new products, confirm freedom to operate with respect to their product design, help them secure patent protection, assess the competitive technology landscape and ensure that their products comply with required industry standards.

Patent Product Line

Our Patent Product Line (“PPL”) enables customers to evaluate the novelty of potential new products, confirm freedom to operate with respect to their product design, help them secure patent protection, assess the competitive technology landscape and ensure that their products comply with required industry standards.

We provide a range of analytics capabilities and data visualization tools to improve the efficiency and accuracy of IP-driven decisions.

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The product is powered by Derwent World Patents Index, our proprietary database of over 103 million patent publications from 59 patent offices, which represented 92% of all patents published globally in 2021 and has been developed and curated for over 50 years.

The database combines data science with our team of domain experts who correct, enrich and abstract over six million global patents per year in over 30 languages, as of December 31, 2020.

The database combines data science with our team of domain experts who correct, enrich and abstract over seven million global patents per year in over 30 languages, as of December 31, 2021.

We provide customers with easy-to-understand summaries of patent filings that are prepared by our domain experts, who index and translate the highly technical and intentionally obscure patent filings into understandable abstracts that provide insights into a patent’s novelty, use and advantage over prior patents.

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• An employee developing a new product or idea (e.g., a chemical engineer or a product designer) will access the Derwent database of patents to evaluate the novelty and determine the patentability of the new product or idea.

Trademarks Product Line

Our Trademarks Product Line (“TPL”) provides trademark research and protection services for businesses and law firms globally and relies on our leading trademark database, CompuMark.

Our CompuMark’s offerings span the entire life cycle of a trademark, from determining availability of a proposed trademark to monitoring for infringement post registration.

Trademark Product Line

Our Trademark Product Line (“TPL”) provides trademark research and protection services for businesses and law firms globally and relies on our leading trademark database, CompuMark.

CompuMark’s offerings span the entire life cycle of a trademark, from determining availability of a proposed trademark to monitoring for infringement post registration.

TPL provides global trademark research and protection to corporations and law firms globally.

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Coupled with industry specific sources,

including over 65 industrial design databases and 70 Pharma In-Use Databases, as of December 31, 2020, CompuMark delivers the most comprehensive data set for trademark professionals available.

including over 65 industrial design databases and 70 Pharma in-use databases, as of December 31, 2021, CompuMark delivers the most comprehensive data set available for trademark professionals.

Key products include trademark screening, trademark searching and trademark watching.

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(ii) preparing detailed, custom reports post screening that uncover potential risks related to a proposed trademark, which we refer to as “clearance searching”;

and (iii) monitoring trademark applications and other data sources on a recurring subscription revenues basis to alert clients to potential instances of infringement post registration, which we refer to as “watching.”

and (iii) monitoring trademark applications and other data sources on a recurring subscription revenues basis to alert customers to potential instances of infringement post registration, which we refer to as “watching.”

Example Use Case

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The attorney will then subscribe to CompuMark’s trademark watching services to continually ensure that none of their customers’ valuable trademarks are being infringed upon.

Domains Product Line

Our Domains Product Line (“DPL”) helps global enterprises establish, manage, optimize and protect their online presence.

Domain Product Line

Our Domain Product Line (“DPL”) helps global enterprises establish, manage, optimize and protect their online presence.

Our primary offering, MarkMonitor, provides a suite of technology services for brand managers, IT managers, marketing teams, and legal counsel in corporations to register and manage portfolios of domain names critical for their business.

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IP Management Product Line

Our IP Management Product Line ("IPMPL") provides technology solutions and legal support services across the intellectual property lifecyle under the CPA Global brand name.

Our IP Management Product Line ("IPMPL") provides technology solutions and legal support services across the intellectual property lifecycle under the CPA Global brand name.

The principal activities are renewal and validation of IP rights on behalf of customers and the development and provision of IP management software, as well as other activities including patent searching, IP filing, prosecution support and trademark watching.

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• A law firm partnership uses the technology solutions to provide renewal and validation of IP rights on behalf of a customer.

The Clarivate management team, led by Executive Chairman and Chief Executive Officer Jerre Stead, has implemented a transformation strategy designed to improve operations, increase cash flow and accelerate revenues growth.

Stead’s leadership, we have embarked on a race to deliver excellence to the markets we serve and continue our evolution as a world-class organization.

The Clarivate management team has implemented a transformation strategy designed to improve operations, increase cash flow and accelerate revenues growth.We have embarked on a race to deliver excellence to the markets we serve and continue our evolution as a world-class organization.

As we move forward, the focus will be on three basic principles;

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Relentlessly driving execution of our strategy and growth plans.

These changes will help us operate with greater focus and urgency.

They will ensure that we put our clients first, drive accountability throughout the organization, accelerate decision-making, and promote consistency.

These principles will help us operate with greater focus and urgency.

They will ensure that we put our customers first, drive accountability throughout the organization, accelerate decision-making, and promote consistency.

These tenets will enable us to deliver long-term, sustainable growth.

With a proven operational playbook with multiple levers, we have quickly pursued initiatives to set ourselves on a growth trajectory.

Our results for the year ended December 31, 2020 are among the first proof points that our transformation is underway.

Our results for the year ended December 31, 2021 are continued proof that our transformation is well underway.

Accelerate Revenue Growth 2021 Earnings Progress Report (1)

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• developing new value-added products and services;

• delivering an enhanced client experience through ongoing renovations to our products’ user interface and user experience;

• delivering an enhanced customer experience through ongoing renovations to our products’ user interface and user experience;

• offering additional analytics that enhance existing products and services;

• moving up the value chain by providing our clients with predictive and prescriptive analytics, allowing for stronger growth and higher retention rates;

• moving up the value chain by providing our customers with predictive and prescriptive analytics, allowing for stronger growth and higher retention rates;

• expanding our footprint with new and existing customers, with significant opportunity for growth in the Asia Pacific and emerging markets;

• broadening our consulting capabilities, in particular in the Science Group, where there is considerable opportunity for us to deliver high value consulting services to drive significant revenues growth;

• broadening our consulting capabilities, in particular in the Science segment, where there is considerable opportunity for us to deliver high value consulting services to drive significant revenue growth;

• optimizing product pricing and packaging based on customer needs;

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Given the fragmented nature of the broader information services industry, we track and, where appropriate, will continue to pursue opportunities across our product lines.

From 2017 through 2020, we completed seven small add-on acquisitions and two significant acquisitions to augment our existing portfolio of assets and provide additional datasets and services for our customers.

Our completed acquisitions include Publons, Kopernio and Decision Resources Group within the Science segment and TrademarkVision, SequenceBase, Darts-ip, CPA Global, Beijing IncoPat and Hanlim in the IP segment.

From 2017 through 2021, we completed nine small add-on acquisitions and three significant acquisitions to augment our existing portfolio of assets and provide additional datasets and services for our customers.

Our completed acquisitions include Publons, Kopernio, Decision Resources Group, Bioinfogate, ProQuest, and Patient Connect within the Science segment and TrademarkVision, SequenceBase, Darts-ip, CPA Global, Beijing IncoPat and Hanlim in the IP segment.

We also acquired the assets of CustomersFirst Now, which was accounted for as an asset acquisition.

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Our focus is on disciplined and accretive investments that leverage our core strengths and enhance our current product, market, geographic and customer strategies.

We believe that the combination of Mr.

Stead’s successful acquisition track record and our scale and status as a global information services leader uniquely positions us to create value through additional acquisitions.

We believe that our scale and status as a global information services leader uniquely positions us to create value through additional acquisitions.

Positive Sector Dynamics Support Our Trajectory

We operate in the global information services and analytics sector, which is experiencing robust growth due to many factors.

We operate in the global information and analytics sector, which is experiencing robust growth due to many factors.

Data and analytics have become critical inputs into broader corporate decision-making in today’s marketplace, and companies and institutions are seeking services like ours to enhance the predictive nature of their analysis.

In addition to creating greater demand for our services, rapid innovation within our customers’ businesses has created new use cases for our services.

Third-party industry reports estimate the global data and analytics market will grow from $169 billion in 2018

to $274 billion by 2022, a 13.2% compound annual growth rate over the period.

This represents the target addressable market across verticals that have a need for data and analytical services.

We have a significant addressable opportunity of over $100 billion which represents the target addressable market across verticals that have a need for data and analytical services.

Customers of data and analytics products continue to approach complex business decisions in new ways.

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As such, we are investing in these critical, forward-facing products and solutions.

We believe offering these types of products will increase the value clients place on our products, allow for stronger growth and open new addressable markets, as illustrated below.

We believe offering these types of products will increase the value customers place on our products, allow for stronger growth and open new addressable markets, as illustrated below.

Significant Move Up the Value Chain with Smart Data Offerings

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Leading Market Positions in Attractive and Growing Global Markets

We offer a collection of high-quality, market-leading information and analytic products and solutions serving the intellectual property, scientific research and life sciences end-markets.

Through our products and services, we address the large and growing demand from corporations, government agencies, universities, law firms and other professional services organizations worldwide for comprehensive, industry-specific content and analytical tools to facilitate the discovery, development, protection, commercialization and measurement of scientific research, innovations and brands.

We believe that our flagship products hold a #1 or #2 position by revenue across the respective markets they serve, including abstracting and indexing databases, life science regulatory and competitive intelligence and intellectual property protection (including patent, trademarks and brand protection).

We also believe that the outlook for growth in each of our Product Lines is compelling because of customer demand for curated high-quality data, underpinned by favorable end-market trends, such as rising global R&D spending, growing demand for information services in emerging markets, the acceleration of e-commerce and the increasing number of patent and trademark applications.

A Trusted Partner Delivering Highly Curated Content Embedded Within Customer Workflows

We offer a collection of high-quality, market-leading information and insights products and solutions serving the Academia & Government, Life Sciences & Healthcare, Professional Services and Consumer Products, Manufacturing & Technology end-markets.

Through our products and services, we address the large and growing demand from corporations, government agencies, universities, researchers, law firms and other professional services organizations worldwide for comprehensive, industry-specific information and analytical tools to facilitate the discovery, development, protection, commercialization and measurement of scientific research, inventions and brands.

We believe that the outlook for growth in each of our Product Lines is compelling because of customer demand for curated high-quality data, underpinned by favorable end-market trends, such as rising global R&D spending, growing demand for information services in emerging markets, the acceleration of e-commerce and the increasing number of patent and trademark applications.

A Trusted Partner Delivering Highly Curated Information Embedded Within Customer Workflows

We believe the substantial increase in unstructured data over the last decade has increased the importance of our proprietary, curated databases to our customers.

Our suite of branded information and analytic solutions provides access to content that has been collected, curated and standardized over decades, making our products and services highly valued and increasingly important for our customers.

Our suite of branded information and insights solutions provides access to content that has been collected, curated and standardized over decades, making our products and services highly valued and increasingly important for our customers.

Our content curation and editorial teams include over 1,400 employees who clean, analyze and classify unstructured data to ensure high-quality content and an enhanced user experience.

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We believe that the diversified nature of our Product Lines enhances the stability of our entire platform as we are not dependent on any one end-market, product, service or customer.

We serve a large, diverse and global customer base, and as of December 31, 2020, we served over 30,000 customers in more than 170 countries, including the top 30 pharmaceutical companies by revenues.

No single customer accounted for more than 1% of revenues and our ten largest customers represented only 6% of revenues for the year ended December 31, 2020.

We serve a large, diverse and global customer base, and as of December 31, 2021, we served over 50,000 customers in approximately 180 countries, including the top 30 pharmaceutical companies.

Our 10 largest customers represented only 9% of revenues for the year ended December 31, 2021.

We believe the strong value proposition offered by our content, combined with the integration of our products and services into our customers’ daily workflows and decision-making processes, leads to substantial customer loyalty.

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We believe multi-year agreements also help to maintain this resiliency.

During the economic downturn of 2008 to 2009, three of our key products — Web of Science, Cortellis and Derwent — realized year-over-year revenues increases.

During the COVID pandemic, certain of our key products realized year-over-year revenue increases and have been able to maintain annual revenues renewal rates in excess of 90%.

In addition, our diverse global footprint reduces our exposure to national and regional economic downturns.

Our performance is largely due to the sectors we serve and the deep integration of our products with our customers’ workflows, which provides for a resilient business model even during an economic downturn.

Proven and Experienced Leadership

Stead is a proven business operator with demonstrated success in shareholder value creation.

At Clarivate, Mr.

Stead brings his decades of expertise in the information services sector to guide a talented and experienced management team sourced from world-class, global companies, most of whom have decades of experience in their respective areas of expertise.

Background and History

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Helier, Jersey JE1 4TR.

Our principal business offices

are located at Friars House, 160 Blackfriars Road, London SE1 8EZ, United Kingdom, where our main telephone number is +44 207 4334000.

Our principal business offices are located at 70 St.

Mary Axe, London EC3A 8BE, United Kingdom, where our main telephone number is +44 207 4334000.

We maintain a website at www.clarivate.com.

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it made further investments in complementary businesses centered on life science research and domain management.

Since Thomson Reuters acquired DWPI and ISI, the business now known as Clarivate has emerged as the leading global information services and analytics company serving the scientific research, intellectual property and life sciences end-markets.

Through product development, investment and acquisitions, we have developed a full suite of solutions providing high-value structured information that facilitates the discovery, protection and commercialization of scientific research, innovations and brands.

Since Thomson Reuters acquired DWPI and ISI, the business now known as Clarivate has emerged as the leading global information and analytics company serving the scientific research, intellectual property and life sciences end-markets.

innovations and brands.

During the majority of its time under prior ownership, the Company operated as a set of non-core, separate divisions until Thomson Reuters decided in 2015 to divest them.

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The first transformative event occurred in October 2016, when Onex and Baring acquired subsidiaries and assets comprising the intellectual property and science business of Thomson Reuters for $3,566,599 and formed Clarivate.

Onex, Baring and the new executive team they put in place focused on transitioning us to be a standalone company and completed a substantial number of operational improvements, including:

Onex, Baring and the new executive team they put in place focused on transitioning the business to be a standalone company and completed a substantial number of operational improvements, including:

• building a new senior executive management team;

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Strategic Acquisitions

Acquisition of ProQuest

On December 1, 2021, we acquired 100% of ProQuest, a leading global software, data and analytics provider to academic, research and national institutions, and its subsidiaries from Cambridge Information Group (“CIG”), Atairos and certain other equityholders (collectively, the “Seller Group”).

The aggregate consideration in connection with the closing of the ProQuest acquisition was $4,994,334, net of $52,514 cash acquired.

The aggregate consideration was composed of (i) $1,094,901 from the issuance of up to 46,910,923 ordinary shares to the Seller Group and (ii) approximately $3,951,947 in cash, including approximately $917,491 to fund the repayment of ProQuest debt.

We funded the cash purchase price through a combination of cash on hand, new debt financing in the form of the Senior Unsecured Notes and the Senior Secured Notes (see Note 14 of the Notes to Consolidated Financial Statements) and equity financing in the form of the June 2021 Ordinary Share Offering and the 5.25% Series A Mandatory Convertible Preferred Shares Offering (see Note 16 of the Notes to Consolidated Financial Statements).

Acquisition of CPA Global

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Clarivate acquired all of the outstanding shares of CPA Global in a cash and stock transaction.

The aggregate consideration in connection with the closing of the CPA Global acquisition was $8,740,989, net of $98,610 cash acquired, including an equity hold back consideration of $46,485.

The aggregate consideration in connection with the closing of the CPA Global acquisition was $8,540,886, net of $102,675 cash acquired, including an equity hold back consideration of $46,485, which was issued in January 2021.

The aggregate consideration was composed of (i) $6,565,477 from the issuance of up to 218,183,778 ordinary shares to Redtop Holdings Limited, a portfolio company of Leonard Green & Partners, L.P., representing approximately 35% pro forma fully diluted ownership of Clarivate and (ii) approximately $2,078,084 in cash to fund the repayment of CPA Global's parent company outstanding debt of $2,055,822 and related interest swap termination fee of $22,262.

Of the 218,306,663 ordinary shares issuable in the acquisition, Clarivate issued 210,357,918 ordinary shares as of October 1, 2020.

There were 6,325,860 shares that were issued to Leonard Green & Partners, L.P.

that were returned to Clarivate to fund an Employee Benefit Trust established for the CPA Global Phantom Equity Plan.

Accordingly, these shares were excluded from purchase price consideration.

In conjunction with the closing of the transaction, the Company incurred an incremental $1,600,000 of term loans under our term loan facility and used the net proceeds from such borrowings, together with cash on hand, to fund the transaction.

As a result of the additional term loan associated with the CPA Global acquisition, we had $2,847,400 outstanding on our term loan facility as of December 31, 2020.

Acquisition of Decision Resources Group

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The acquisition helps us expand our core businesses and provides us with the potential to grow in the Life Sciences Product Line.

The aggregate consideration paid in connection with the closing of the DRG acquisition was $964,997, composed of $900,000 of base cash plus $6,100 of adjusted closing cash paid on the closing date and up to 2,895,638 of the Company's ordinary shares to be issued to PEL following the one-year anniversary of closing.

The contingent stock consideration was valued at $58,897 on the closing date and will be revalued at each period end and included in the Accrued expenses and other current liabilities in the Consolidated Balance Sheets.

Acquisition of Hanlim IPS Co., Ltd.

On November 23, 2020, we acquired 100% of the assets, liabilities and equity interests of Hanlim IPS.

("Hanlim"), a leading patent renewal and information service provider in South Korea via cash on hand for $9,254.

Hanlim is complementary to Clarivate’s intellectual property portfolio.

Acquisition of Beijing IncoPat Technology Co., Ltd.

On October 26, 2020, we acquired 100% of the assets, liabilities and equity interests of Beijing IncoPat Technology Co., Ltd.

(“IncoPat”), a leading patent information service provider in China via cash on hand for $52,133.

IncoPat is complementary to Clarivate’s intellectual property portfolio.

The contingent stock consideration was valued at $58,897 on the closing date and was revalued at each period end and included in the Accrued expenses and other current liabilities in the Consolidated Balance Sheets.

Redemption of Public Warrants

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We retained the MarkMonitor Domain Management business.

We serve a large, diverse and global customer base and, as of December 31, 2020, we served over 30,000 customers in more than 170 countries as well as the top 30 pharmaceutical companies by revenue.

Our customers either use our databases on an exclusive basis or on a dual-sourced basis.

No single customer accounted for more than 1% of revenues and our ten largest customers represented only 6%, 5% and 6% of revenues for the years ended December 31, 2020, 2019, and 2018 respectively.

We serve a large, diverse and global customer base and, as of December 31, 2021, we served over 50,000 customers in approximately 180 countries.

Our customers either use our databases on an exclusive basis or on a dual-sourced basis and our 10 largest customers represented only 9%, 6% and 5% of revenues for the years ended December 31, 2021, 2020 and 2019, respectively.

Competitive Environment

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• Abstracting and Indexing Database Market :

Elsevier (Scopus, SciVal), Digital Science (Dimensions) and ProQuest (RefWorks);

Elsevier (Scopus, SciVal), and Digital Science (Dimensions);

• Patent Protection Market :

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Corporation Service Company ("CSC") (domain name management) and AppDetex (domain management and online brand protection).

• Academic and Government Market :

Barriers to entering the higher education, research institutions, corporate, K-12, government agency and public organization markets, especially with respect to Open Access and Open Educational Resource products and platforms, are relatively low, and we expect competition in these markets to intensify.

Sources of Data

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They are used for the storage, processing, access and delivery of the data which forms the foundation of our business and the development and delivery of our solutions provided to our customers.

Much of the technology we use and provide to our customers is developed, maintained and supported by approximately 1,226 employees and approximately 669 contractors, as of December 31, 2020.

We generally own or have secured ongoing rights to use for the purposes of our business all the customer-facing applications which are material to our operations.

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We also add to our business line offerings through acquisitions.

We have completed two significant acquisitions in 2020 including DRG, expanding upon our life sciences product line and CPA Global, broadening our IP product offerings.

During the past four years we have completed small add-on acquisitions to augment our existing portfolio of assets and provide additional datasets and services for our customers.

We have completed three significant acquisitions in 2021 and 2020 including ProQuest and DRG, expanding our Sciences product offerings, and CPA Global, broadening our IP product offerings.

During the past five years we have completed small add-on acquisitions to augment our existing portfolio of assets and provide additional datasets and services for our customers.

Given the fragmented nature of the broader information services industry, we track and, where appropriate, have pursued opportunities across our Product Lines.

These include Publons and Kopernio in APL, SequenceBase in PPL, Connect in CPA Global and TrademarkVision and Darts-ip in Trademark Product Line.

This includes, for example, Connect in CPA Global.

These acquisitions are fully integrated into our platform and we believe they have already provided additional value to our customers.

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Focusing some of our sales and marketing efforts on digital sales and marketing has allowed us to broaden our range of customers and reduce sales and marketing costs.

We have a dedicated sales and marketing force, which, as of December 31, 2020, consisted of approximately 1,469 people.

We annually develop sales, distribution and marketing strategies on a product-by-product and service-by-service basis.

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A team approach and a common customer relationship management system allow for effective coordination between the two groups.

As of December 31, 2020, approximately 8,445 full-time and approximately 245 part-time employees support our business operations.

The employee count excludes employees related to the MarkMonitor Brand Protection, Antipiracy and Antifraud disposition in January 2020 and the Techstreet Disposition in November 2020.

Management's Discussion and Analysis of Financial Condition and Results of Operations - Factors Affecting the Comparability of Our Results of Operations for information related to the disposition.

Human Capital

As of December 31, 2021, we had approximately 11,095 full-time and approximately 258 part-time employees located in 43 countries around the world supporting our business operations.

Of our total employees, 3,391 were located in the Americas, 4,940 were located in APAC and 3,022 were located in EMEA.

The below chart summarizes the percentage of our employees by geographic area:

None of our employees in the United States are represented by unions;

however, customary representation by unions and works councils applies for certain of our non-U.S.

We consider our relationship with our employees to be good and have not experienced interruptions to operations due to labor

disagreements.

The Company has spent the past two years fostering a values-led culture that begins with the Company’s purpose and vision that human ingenuity can transform the world and we will improve the way the world creates, protects and advances innovation.

With a continuous focus on three corporate values (aim for greatness, value every voice and own your actions) along with transparent communication and a wide variety of colleague support programs, colleague engagement has steadily climbed and reached 79 (out of 100) in September 2020.

however, customary representation by unions and

works councils applies for certain of our non-U.S.

We consider our relationship with our employees to be good and have not experienced interruptions to operations due to labor disagreements.

Diversity, Equity, Inclusion & Belonging ("DEIB")

We have taken our commitment to diversity, equity, inclusion and belonging to a whole new level, especially after witnessing instances of civil unrest and outcries for real change.

We believe that our colleagues are our most important competitive advantage and see people coming together from different cultures and backgrounds, with different life experiences, as a key driver of innovation.

We know that colleagues who feel engaged and included will be the most proactive and productive.

Our goal is to weave these principles into the fabric of our culture to become a recognized global leader and employer of choice.

Throughout our organization and across all our regions, we are accelerating innovation and action in support of a more diverse and inclusive workforce.

As a company, we are magnifying our voice, our platform and our resources to address injustice and inequity wherever it occurs.

In 2020, we signed the CEO Action for Diversity & Inclusion, the largest CEO-driven business commitment to advancing diversity and inclusion in the workplace.

As part of our commitment to the CEO Action for Diversity & Inclusion, we supported two colleagues to represent Clarivate as Racial Equity Fellows, and continue to do so in 2022.

We are also signatories to the UN Women’s Empowerment Principles, and the UN Global Compact and in 2021, proudly joined the coalition of Scientific publishing organizations and national laboratories, partnering on transgender-inclusive name-change process for published papers.

Name changes allow researchers of all genders to own their academic work.

We are taking positive actions to further diversity, equity, inclusion and belonging led by the Clarivate Diversity Council.

Our five-pillar framework of Leadership, Culture, Workplace practices, Business integration and Community, includes key elements such as Board level accountability through the Nominating, Governance and Sustainability Committee, Board Diversity Policy, advancing people analytics and metrics insights, setting targets for diverse hiring in every part of our organization, non-bias training and education, engaging in difficult conversations around the role of race in our company and society, strategic structure and support for colleague engagement through Colleague Resource Groups and supporting diversity throughout our supply chain and in our communities.

The Company's Colleague Resource Groups include:

• SPECTRUM , Clarivate’s LGBTQ+ and Allies resource group;

• Women @ Clarivate , support of advancing the Women’s Empowerment Principles;

• Vibrant , Clarivate’s colleague resource group focused on racial & ethnic diversity, inclusion and equity;

• Military Veterans at Clarivate , supporting members with military backgrounds, including military family members and supporters;

• Clarivate Volunteer Network , to explore and promote the benefits of volunteering and reach our Sustainability goals;

• Element , the Environment and Climate Change colleague resource group to raise awareness of the environment and our impact on it and to promote activities and behaviors to address our environmental impact.

Learning and Development Programs

Our learning and development ("L&D") philosophy is about bringing our organizational beliefs and values to life – to map our actions and behaviors to our words.

It’s about empowering each colleague to be their best self every day and providing a wide range of skills development opportunities applicable now and for the future.

Some guiding principles include:

• We develop our L&D plans and programs in alignment with our key business functions to help further our mutual success and avoid creating silos;

• Our L&D commitments are performance related and designed to improve corporate, functional, team and individual accountability;

• We strongly believe that every colleague across our entire business should be provided equal opportunities to learn, develop and grow;

• We believe in empowering individual colleagues with their own L&D milestones.

With ownership comes commitment, responsibility and greater chances of success for ongoing learning and development;

• We continuously focus on outcomes and business impact when it comes to evaluating L&D programs.

Retention and Engagement

The Company has spent the past three years fostering a values-led culture that begins with the Company’s Purpose and Vision that human ingenuity can transform the world and we will improve the way the world creates, protects and advances innovation.

With a continuous focus on three company Values (aim for greatness, value every voice and own your actions) along with transparent communication and a wide variety of colleague support programs, our colleague engagement has steadily climbed and reached a score of 75 (out of 100) in October 2021.

We provide a variety of benefits to promote retention and growth of our employees.

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We have an online academy that fosters a learning culture, leveraging the knowledge and expertise of our people.

Workplace Health and Safety

We have invested in a robust, proven health and well-being strategy to foster a healthier, happier and more productive workforce.

We’re committed to providing colleagues with meaningful resources to support their personal, family and community needs using a holistic approach that focuses on four key pillars of well-being:

Physical, Financial, Social and Emotional.

As part of a new level of health and wellness engagement, we:

• Launched ‘Be Well’, our new, online well-being platform that enables colleagues to take a health assessment, track daily health habits, participate in health and fitness challenges, sync mobile and fitness devices and more - all while earning rewards along their personalized well-being journey;

• Leverage data insights from benefits utilization reports, real-time analytics, colleague feedback and more to continuously enhance our engagement and impact;

• Provide access to science-based tools and technologies to help colleagues better navigate the digital workplace while balancing needs at home;

• Leverage proven techniques to enhance mindfulness, stress management, emotional intelligence, resilience, quality of sleep, performance and more.

We have also provided the following support during the COVID-19 pandemic:

• Maintained a steady, compassionate communications with colleagues to help them ensure they remain safe and informed, including weekly live Q&A sessions with the CEO and leadership team;

• Increased focus on mental health and well-being in response to disruptive impact of the global pandemic;

• Prioritized and promoted our global Employee Assistance Program ("EAP") to provide all colleagues with the support they need;

• Enhanced existing programs, such as increased paid time off, expanded child/elder care benefits, allowed rollovers and mid-year election changes to pre-tax spending accounts in the United States, adopted several CARES Act provisions in our 401(k) Plan and more;

• Launched a financial hardship assistance program in response to COVID-19 which delivered funding to help colleagues and their families.

Sustainability and Environment, Social and Governance (“ESG”)

Recognizing that sustainability and ESG are critical to the Company’s future success, a formal ESG commitment was launched in 2020, with the issuance of our inaugural sustainability report in 2021, landing in the 76 th percentile in the S&P Global Corporate Sustainability Assessment upon our first entry.

Sustainability is everything we do, and we approach it holistically across all aspects of ESG dimensions, in support of and alignment with the United Nations Sustainable Development Goals.

ESG pillars of Sustainability@Clarivate

We are progressing at a rapid pace since launching our ESG journey, with ambitious goals to be listed on the DJSI in 2024 and be carbon neutral for all known and measurable emissions.

As we work to advance a more sustainable world, we have begun mapping all we do to the UN Sustainable Development Goals ("SDG"), with a focus on mapping our customer impact and SDGs 3, 9, and 12;

and internally focused on responsible business practices that address SDG 12, 13 and 10.

We continue to work on minimizing environmental impacts, with our global e-waste program, and in 2021 publishing environmental metrics for 75%+ of facilities for the first time, thus also enabling us to report into the CDP for the first time.

We are now evaluating our suppliers for ESG performance, having invited our 100 top suppliers to participate in our ESG assessments, with over 30% of supplier spend now completed the assessments.

We are making great strides in our Climate Transition planning with improved ability to capture, track, minimize and mitigate our carbon footprint, SDG 13.

Our social efforts are focused on our colleagues and our community.

In 2021, we reported out in our sustainability report many human capital metrics for the first time and we continue to build our capabilities for robust people metrics management, as we advance our DEIB efforts in support of SDG 10 and reducing inequalities.

We participated for the first time in the Diversity 50 and Corporate Equality Index, helping to build upon our work and further inform our DEIB strategy.

We have over 80 global and local sustainability teams and colleague resource groups, working in alignment through the Global Engagement Council to enable colleague actions and real impact.

Through our Clarivate Volunteer Network, we shared over 14,000 hours of time helping in communities around the world and launched a global volunteer recognition program.

We are building meaningful strategic partnerships that further strengthen our engagement opportunities, community impact and advance all 17 SDGs.

We are committed to maintaining the highest level of trust, transparency and ethics in all we do, and are proud participants in the UN Global Compact, including participation in the UN SDG Ambition program.

In 2021 Sustainability officially became of the Board Committee, known as the Nominating, Governance and Sustainability Committee.

We have a robust privacy center online, published the Board Diversity statement and updated the Modern Slavery statement.

The company achieved ISO 27001 in recognition of the critical importance of information security.

Our cash flows from operations are generated primarily from payments from our subscription customers and the standard term of a subscription is typically 12 months.

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Our Product Lines that provide such products and services are subject to applicable privacy and consumer information laws and regulations, including U.S.

federal and state and European Union (the “EU”) and member state regulation.

federal and state and European Union (“EU”) and member state regulation.

Our compliance obligations vary from regulator to regulator, and may include, among other things, strict data security programs, submissions of regulatory reports, providing consumers with certain notices and correcting inaccuracies in applicable reports.

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Risk Factors for more information about the impact of government regulation on our company.

Sustainability and Environment, Social and Governance (“ESG”)

Recognizing that sustainability and ESG are critical to the Company’s future success, a formal ESG commitment was launched in 2020.

Built around four ESG pillars (i.e., governance, environment, colleagues and community) and aligned to the United Nations Sustainable Development Goals, our goal is to embed sustainability into the fiber and operations of the company and further strengthen the values-led company culture.

The four ESG pillars of Sustainability@Clarivate

During the many challenges posed by the uncertainty of the global pandemic, Sustainability@Clarivate achieved a number of important initial milestones, primarily around reporting, organizational infrastructure and governance deliverables.

The below describes the actions taken by the Company to ensure a focus on sustainability:

• Assessed, developed and launched Sustainability@Clarivate framework and strategy, including a dedicated sustainability office and team, a sustainability steering committee, a sustainability champions network, and a comprehensive scorecard of goals across all dimensions;

• Signatory to the United Nations Women's Empowerment Principles (WEPs), the CEO Action for Diversity and Inclusion and the Stonewall Transgender Rights are Human Rights;

• Launched an advanced privacy center and expanded ESG information sharing to increase transparency and commitment to annual goal setting;

• Implemented a global e-waste program and launched an R2 compliant e-waste recycling effort across our global operations;

• Implemented a third party environmental metrics system to collect and analyze data in order to optimize our real estate portfolio;

• Initiated efforts to build a more sustainable supply chain by evaluating our top 100 suppliers against a comprehensive ESG evaluation framework;

• Earned Ecovadis Bronze Level and Gold Level recognition with our Proctor & Gamble ESG evaluation

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 1. Business