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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

2022-01-28 compared with 2021-01-28 · 633 added, 763 removed, 764 unchanged (65% of the section changed)

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We manage cash flow exposures for our major countries and the foreign currency impact of assets and liabilities denominated in non-functional currencies using a combination of forward contracts.

Principal currencies hedged are the Philippine Peso, Indian Rupee, Euro, Canadian Dollar, Japanese Yen, British Pound and Chinese Yuan.

Principal currencies hedged are the Australian dollar, Brazilian real, British pound, Canadian dollar, Chinese yuan, Czech koruna, Danish krone, Euro, Indian rupee, Indonesian rupiah, Japanese yen, Mexican peso, Norwegian krone, Philippine peso, Polish zloty, Singapore dollar, Swedish krona and Swiss franc.

We do not hold or issue derivative financial instruments for trading purposes.

The following table presents the hypothetical changes in fair values of our outstanding foreign currency derivative instruments as of November 30, 2020 and 2019, arising from an instantaneous strengthening or weakening of the U.S.

dollar by 5%, 10% and 15% (in thousands).

Loss on Derivative Instruments Given a

Weakening of U.S.

dollar by X Percent

Exchange Rate

Gain on Derivative Instruments Given a

Strengthening of U.S.

dollar by X Percent

Forward contracts at

November 30, 2020

Forward contracts at

November 30, 2019

We applied hedge accounting to our long-term forward contracts which would reduce the variability of cash flows denominated in foreign currencies.

We served many of our clients in our Concentrix segment using service delivery centers in other geographies.

As a result, the contracts with these clients are typically priced in one currency, while a substantial portion of the costs incurred to deliver services under these contracts are denominated in the local currency of the country where services are provided, which represents a foreign exchange exposure.

The change in the value of these forward contracts would be expected to offset a corresponding foreign currency change in forecasted hedged revenues or cost when recognized.

All of the long-term forward contracts were related to the Concentrix segment and upon completion of the Separation no longer represent a risk to us.

All other foreign exchange contracts have typical maturities of twelve months or less and are executed to protect us against foreign currency exposure pertaining to receivables, payables and intercompany transactions that are denominated in currencies different from the functional currencies of the respective entities.

These contracts are marked-to-market and any material gains and losses on our hedge contracts resulting from a hypothetical, instantaneous change in the strength of the U.S.

dollar would be significantly offset by mark-to-market gains and losses on the corresponding assets and liabilities being hedged.

In order to provide an assessment of our foreign currency exchange rate risk, we performed an analysis using a value-at-risk (“VaR”) model.

The VaR model uses a Monte Carlo simulation to generate 1,000 random market price paths.

The VaR model determines the potential impact of the fluctuation in foreign exchange rates assuming a one-day holding period, normal market conditions and a 95% confidence level.

The model is not intended to represent actual losses but is used as a risk estimation and management tool.

Firm commitments, assets and liabilities denominated in foreign currencies were excluded from the model.

The estimated maximum potential one-day loss in fair value, calculated using the VaR model, would be approximately $3.8 million and $1.9 million at November 30, 2021 and 2020, respectively.

We believe that the hypothetical loss in fair value of our foreign exchange derivatives would be offset by the gains in the value of the underlying transactions being hedged.

Actual future gains and losses associated with our derivative positions may differ materially from the analyses performed as of November 30, 2021, due to the inherent limitations associated with predicting the changes in foreign currency exchange rates and our actual exposures and positions.

Interest Rate Risk

Our exposure to changes in interest rates relates primarily to our outstanding debt obligations which have floated relative to major interest rate benchmarks in the United States, Canada and Japan.

Our exposure to changes in interest rates relates primarily to our outstanding debt obligations which have floated relative to major interest rate benchmarks.

We are most sensitive to fluctuations in U.S.

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dollar-denominated floating-rate debt, we have entered into interest rate swaps with aggregate notional amounts of $1.5 billion and $1.6 billion as of November 30, 2021 and 2020 respectively, which effectively converted a portion of the floating rate debt to a fixed interest rate.

Substantially, all of our interest rate swaps are accounted as cash flow hedges.

All of our interest rate swaps as of November 30, 2021 are accounted for as cash flow hedges.

A 15% variation in our interest rates would not have a material impact on the fair value of our swaps.

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The following tables present hypothetical interest expense related to our outstanding borrowings with variable interest rates (after considering the impact of the above mentioned swaps) for the years ended November 30, 2020 and 2019 , arising from hypothetical parallel shifts in the respective countries’ yield curves, of plus or minus 5%, 10% and 15% (in thousands).

Interest Expense Given an Interest

Rate Decrease by X Percent

Actual Interest

Expense Assuming

Interest Rate

Interest Expense Given an Interest

Rate Increase by X Percent

SYNNEX Canada

Total for the year ended

November 30, 2020

The following tables present hypothetical interest expense (after considering the impact of the above mentioned swaps) for the years ended November 30, 2021 and 2020, arising from hypothetical parallel shifts in the respective countries’ yield curves, of plus or minus 5%, 10% and 15% related to our outstanding borrowings with variable interest rates.

Interest Expense Given an Interest

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Rate Increase by X Percent

SYNNEX Canada

Total for the year ended

November 30, 2019

(amounts in thousands)

Total for the year ended November 30, 2021

Total for the year ended November 30, 2020

Equity Price Risk

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Gains and losses on marketable equity securities are included in earnings.

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Financial Statemen ts and Supplementary Data

Consolidated Financial Statements of SYNNEX Corporation

Consolidated Financial Statements of TD SYNNEX Corporation

Management’s Report on Internal Control over Financial Reporting

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Notes to Consolidated Financial Statements

Selected Quarterly Consolidated Financial Data (Unaudited)

Financial Statement Schedule

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Financial statement schedules not listed above are either omitted because they are not applicable or the required information is shown in the Consolidated Financial Statements or in the Notes thereto.

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Management’s Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f).

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f).

Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

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Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Our evaluation did not include the internal control over financial reporting of Tiger Parent (AP) Corporation, the parent company of Tech Data Corporation (“Tech Data”), which was acquired on September 1, 2021.

Total assets and total revenue related to Tech Data excluded from our evaluation represented approximately 40% and 32%, respectively, of the related consolidated financial statement amounts as of and for the fiscal year ended November 30, 2021.

Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework).

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The effectiveness of our internal control over financial reporting as of November 30, 2021 has been audited by KPMG LLP, an independent registered public accounting firm, as stated in their report which appears on page 49 of this Report.

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Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors

SYNNEX Corporation:

TD SYNNEX Corporation:

Opinions on the Consolidated Financial Statements and Internal Control Over Financial Reporting

We have audited the accompanying consolidated balance sheets of SYNNEX Corporation and subsidiaries (the Company) as of November 30, 2020 and 2019, the related consolidated statements of operations, comprehensive income, stockholders’ equity, and cash flows for each of the years in the three-year period ended November 30, 2020, and the related notes and financial statement Schedule II - Valuation and Qualifying Accounts (collectively, the consolidated financial statements).

We have audited the accompanying consolidated balance sheets of TD SYNNEX Corporation and subsidiaries (the Company) as of November 30, 2021 and 2020, the related consolidated statements of operations, comprehensive income, stockholders’ equity, and cash flows for each of the years in the three-year period ended November 30, 2021, and the related notes and financial statement Schedule II - Valuation and Qualifying Accounts (collectively, the consolidated financial statements).

We also have audited the Company’s internal control over financial reporting as of November 30, 2021, based on criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework).

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Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of November 30, 2021 based on criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework).

The Company acquired Tiger Parent (AP) Corporation during 2021, and management excluded from its assessment of the effectiveness of the Company’s internal control over financial reporting as of November 30, 2021, Tiger Parent (AP) Corporation’s internal control over financial reporting associated with 40% of total assets and 32% of total revenue included in the consolidated financial statements of the Company as of and for the year ended November 30, 2021.

Our audit of internal control over financial reporting of the Company also excluded an evaluation of the internal control over financial reporting of Tiger Parent (AP) Corporation.

Change in Accounting Principle

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A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the

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maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

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Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

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Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that:

The critical audit matters communicated bel ow are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

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We applied auditor judgment to determine the nature and extent of procedures to be performed over revenue, including the determination of the locations at which those procedures were to be performed.

At each location selected, we performed the following procedures.

We evaluated the design and tested the operating effectiveness of certain internal controls related to the recognition of revenue.

We tested samples of revenue transactions during the year by comparing the amounts recognized by the Company to relevant underlying documentation such as contracts, shipping documents, or other third-party evidence.

For certain locations we evaluated the design and tested the operating effectiveness of certain internal controls related to the recognition of revenue.

For these locations, we then tested samples of revenue transactions during the year by comparing the amounts recognized by the Company to relevant underlying documentation such as contracts, shipping documents, or other third-party evidence.

For other locations we performed a software-assisted analysis to test the relationships among revenues, trade receivables and cash.

For these locations we also examined a sample of executed agreements, inspected cash receipts, and re-calculated revenue recognized.

We investigated a selection of journal entries that were made by the Company to adjust revenue.

We evaluated the sufficiency of the audit evidence obtained over revenue by assessing the results of the procedures performed, including the appropriateness of the determination of locations to perform procedures.

Separation of Concentrix Corporation in a tax-free transaction

As discussed in Note 1 and Note 17 to the consolidated financial statements, the separation of Concentrix Corporation, a wholly-owned subsidiary of the Company, into a separately publicly-traded company was completed in a tax-free transaction on December 1, 2020.

The Company received a favorable opinion from a third-party with respect to the tax-free nature of the transaction for federal income tax purposes.

We identified the evaluation of the tax-free status relating to the separation of Concentrix Corporation as a critical audit matter.

Complex auditor judgment, including the involvement of tax professionals with specialized skills and knowledge, was required to evaluate the Company’s interpretation and application of tax law.

Fair value of acquired intangible assets

As discussed in Note 3 to the consolidated financial statements, on September 1, 2021, the Company acquired Tiger Parent (AP) Corporation (referenced herein as Tech Data) in a business combination.

As a result of the transaction, the Company acquired a customer relationships intangible asset associated with the generation of future income from Tech Data’s existing customers and a trade name intangible asset associated with the value of the Tech Data brand name.

The acquisition-date fair value of the customer relationships intangible asset and the trade name intangible asset was $3,860,200 thousand and $1,073,700 thousand, respectively, which included amounts related to the Americas and Europe reportable segments.

We identified the evaluation of the acquisition-date fair value measurement of the aforementioned intangible assets, specifically within the Americas and Europe reportable segments, as a critical audit matter.

A high degree of subjective auditor judgment was required to evaluate certain assumptions within the discounted cash flow models used to estimate the acquisition-date fair value of these customer relationships and trade name intangible assets.

The discounted cash flow models included the following assumptions for which there was limited observable market information, and the estimated fair value of the related intangible assets was sensitive to possible changes to these assumptions:

revenue growth rates

customer attrition rates

discount rates.

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The following are the primary procedures we performed to address this critical audit matter.

We evaluated the design and tested the operating effectiveness of certain internal controls related to the determination of the tax-free status of the transaction.

This included controls related to the Company’s interpretation and application of relevant tax law and determination of tax-free status.

We involved tax professionals with specialized skills and knowledge who assisted in reading the favorable opinion and basis of conclusions received by the Company from a third-party and performing an evaluation of the tax treatment of the transaction to assess the Company’s interpretation and application of relevant tax law.

We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s acquisition-date valuation process, including a control related to the development of market participant assumptions.

We evaluated the Company’s forecasted revenue growth rates from existing Tech Data customers by comparing forecasted revenue growth assumptions to those of the Company’s peers and industry reports.

We compared the Company’s estimates of forecasted revenue growth to Tech Data’s actual results to assess the Company’s ability to accurately forecast.

We evaluated the relevance and reliability of the historical customer attrition rate through inquiries with Company management, reconciliation of revenue to audited financial statements and trend analysis.

We compared the assumptions related to revenue growth rates and customer attrition rates to those of a market participant, including consideration of recent similar market transactions.

In addition, we involved valuation professionals with specialized skills and knowledge, who assisted in:

evaluating the customer attrition rates by comparing them to Tech Data’s historical customer attrition data

evaluating the discount rates by (i) comparing the inputs of the weighted average cost of capital to available market data for comparable entities and (ii) evaluating the reasonableness of the inputs and assumptions associated with the weighted average return on assets by assessing the methodology used by the Company and performing an independent analysis

testing the acquisition-date fair value of the customer relationships and the trade name intangible assets using the Company’s cash flow forecast and discount rate and comparing the results to the Company’s fair value estimate.

We have served as the Company’s auditor since 2012.

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January 28, 2022

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SYNNEX CORPORATION

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TD SYNNEX CORPORATION

CONSOLIDATED BALANCE SHEETS

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Other current assets

Current assets of discontinued operations

Total current assets

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Intangible assets, net

Deferred tax assets

Other assets, net

Noncurrent assets of discontinued operations

LIABILITIES AND EQUITY

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Accounts payable

Accrued compensation and benefits

Other accrued liabilities

Income taxes payable

Current liabilities of discontinued operations

Total current liabilities

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Deferred tax liabilities

Noncurrent liabilities of discontinued operations

Total liabilities

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Treasury stock, 2,633 and 2,538 shares as of November 30, 2021 and 2020, respectively

Accumulated other comprehensive income (loss)

Accumulated other comprehensive loss

Retained earnings

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The accompanying Notes are an integral part of these Consolidated Financial Statements.

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SYNNEX CORPORATION

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TD SYNNEX CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

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Fiscal Years Ended November 30,

Total revenue

Cost of revenue

Acquisition, integration and restructuring costs

Selling, general and administrative expenses

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Other income (expense), net

Income before income taxes

Income from continuing operations before income taxes

Provision for income taxes

Income from continuing operations

Income from discontinued operations, net of taxes

Earnings per common share:

Continuing operations

Discontinued operations

Continuing operations

Discontinued operations

Weighted-average common shares outstanding:

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The accompanying Notes are an integral part of these Consolidated Financial Statements.

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SYNNEX CORPORATION

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TD SYNNEX CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

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Total change in unrealized losses of defined benefit plans, net of taxes

Unrealized gains (losses) on cash flow hedges during the period, net of taxes of $ 3,981 , $ 15,083 and $( 6,532 ) for fiscal years ended November 30, 2020, 2019 and 2018, respectively.

Reclassification of net (gains) losses on cash flow hedges to net income, net of tax expense (benefit) of ($ 880 ), $ 3,792 and $ 1,150 for fiscal years ended November 30, 2020, 2019 and 2018, respectively.

Unrealized gains (losses) on cash flow hedges during the period, net of tax (expense) benefit of ($ 2,155 ), $ 3,981 and $ 15,083 for fiscal years ended November 30, 2021, 2020 and 2019, respectively.

Reclassification of net (gains) losses on cash flow hedges to net income, net of tax (benefit) expense of ($ 10,278 ), ($ 880 ) and $ 3,792 for fiscal years ended November 30, 2021, 2020 and 2019, respectively.

Total change in unrealized gains (losses) on cash flow hedges, net of taxes

Foreign currency translation adjustments, net of taxes of $ 603 , $ 1,767 and $ 274 for fiscal years ended November 30, 2020, 2019 and 2018, respectively

Foreign currency translation adjustments, net of tax (expense) benefit of ($ 635 ), $ 603 and $ 1,767 for fiscal years ended November 30, 2021, 2020 and 2019, respectively

Other comprehensive income (loss)

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The accompanying Notes are an integral part of these Consolidated Financial Statements.

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SYNNEX CORPORATION

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TD SYNNEX CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

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Treasury stock

comprehensive

income (loss)

paid-in capital

comprehensive income (loss)

Retained earnings

Total stockholders' equity

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Cash dividends declared

Common stock issued for the acquisition of Convergys, net of

stock issuance costs

Other comprehensive income (loss)

Cumulative effect of changes in accounting principles

Stock issuance costs (related to the Convergys acquisition in fiscal year 2018)

Balances, November 30, 2019

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Other comprehensive income (loss)

Cumulative effect of changes in accounting principles

Stock issuance costs (related to the Convergys acquisition in fiscal year 2018)

Balances, November 30, 2020

Separation of Concentrix

Share-based compensation

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shares withheld for employee taxes

Repurchases of common stock

Cash dividends declared

Other comprehensive income (loss)

Issuance of common stock on Tech Data merger, net of issuance costs

Balances, November 30, 2021

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The accompanying Notes are an integral part of these Consolidated Financial Statements.

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SYNNEX CORPORATION

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TD SYNNEX CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

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Contingent consideration

Unrealized foreign exchange (gains) losses

Convertible debt conversion option fair value and extinguishment (gains) losses

Changes in operating assets and liabilities, net of acquisition of businesses:

Unrealized foreign exchange losses

Impairment of long-lived assets

Convertible debt conversion option fair value and extinguishment losses

Changes in operating assets and liabilities, net of the impact of Concentrix separation and acquisition of businesses:

Accounts receivable, net

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Cash flows from investing activities:

Proceeds from maturity of held-to-maturity investments

Proceeds from sale of trading investments

Purchases of property and equipment

Acquisition of businesses (primarily Convergys), net of cash acquired

Acquisition of businesses, net of cash acquired

Net cash used in investing activities

Cash flows from financing activities:

Proceeds from borrowings, net of debt discount and issuance costs ($ 8,521 , $ 22 and $ 9,187 in fiscal years ended November 30, 2020, 2019 and 2018, respectively)

Proceeds from borrowings

Repayments of borrowings

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Repurchases of common stock for tax withholdings on equity awards

Net transfer of cash and cash equivalents to Concentrix

Settlement of contingent consideration

Net cash provided by (used in) financing activities

Proceeds from issuance of Bonds

Cash paid for debt issuance costs

Net cash used in financing activities

Effect of exchange rate changes on cash, cash equivalents and restricted cash

Net increase (decrease) in cash, cash equivalents and restricted cash

Net (decrease) increase in cash, cash equivalents and restricted cash

Cash, cash equivalents and restricted cash at beginning of year

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Income taxes paid

Supplemental disclosure of non-cash investing activities:

Fair value of common stock issued for acquisition of Convergys business

Accrued costs for property and equipment purchases

Supplemental disclosure of non-cash investing and financing activities:

Issuance of stock to acquire business

Net assets transferred to Concentrix

(Amounts may not add due to rounding)

The accompanying Notes are an integral part of these Consolidated Financial Statements.

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SYNNEX CORPORATION

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TD SYNNEX CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(currency and share amounts in thousands, except per share amounts)

(currency and share amounts in thousands unless otherwise noted, except per share amounts)

NOTE 1—ORGANIZATION AND BASIS OF PRESENTATION:

SYNNEX Corporation (together with its subsidiaries, herein referred to as “SYNNEX” or the “Company”) is a leading provider of a comprehensive range of distribution, systems design and integration solutions for the technology industry, headquartered in Fremont, California and has operations in North and South America, Asia-Pacific, Europe and Africa.

On December 1, 2020 , the Company completed the previously announced separation of its customer experience services business (the “Separation”), in a tax-free transaction for federal income tax purposes, which was accomplished by the distribution of one hundred per cent of the outstanding common stock of Concentrix Corporation (“Concentrix”) to SYNNEX stockholders as of the close of business on November 17, 2020 , the record date for the distribution.

TD SYNNEX Corporation (together with its subsidiaries, herein referred to as “SYNNEX”, “TD SYNNEX” or the “Company”) is a leading global provider of a comprehensive range of distribution, systems design and integration solutions for the technology industry , headquartered in Fremont, California and Clearwater, Florida and has operations in North and South America, Europe and Asia-Pacific and Japan.

On December 1, 2020 , the Company completed the previously announced separation of its customer experience services business (the “Separation”), in a tax-free transaction for federal income tax purposes, which was accomplished by the distribution of one hundred percent of the outstanding common stock of Concentrix Corporation (“Concentrix”).

SYNNEX stockholders received one share of Concentrix common stock for every share of SYNNEX common stock held at the close of business on the record date.

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After the Separation, SYNNEX does not beneficially own any shares of Concentrix’ common stock.

The historical results of operations and the financial position of Concentrix are included in the consolidated financial statements of SYNNEX for each of the fiscal years included in this report and will be reported as discontinued operations beginning in the first quarter of fiscal year 2021.

Beginning December 1, 2020, the Company will no longer be consolidating Concentrix within its financial results or reflect the financial results of Concentrix within its continuing results of operations.

In connection with the Separation, the Company and Concentrix have entered into a separation and distribution agreement as well as various other agreements that provide a framework for the relationships between the parties going forward, including among others an employee matters agreement, a tax matters agreement, and a commercial agreement, pursuant to which Concentrix will continue to provide services to SYNNEX following the Separation .

The Company has two reportable segments:

Technology Solutions and Concentrix.

The Technology Solutions segment distributes a broad range of information technology (“IT”) systems and products and also provides systems design and integration solutions.

The Concentrix segment offers a portfolio of technology-infused strategic solutions and end-to-end global business outsourcing services focused on customer experience, process optimization, technology innovation, front and back-office automation and business transformation to clients in five primary industry verticals.

Beginning December 1, 2020, the Company no longer consolidates Concentrix within its financial results or reflects the financial results of Concentrix within its continuing results of operations.

The financial results of Concentrix for the years ended November 30, 2020 and 2019 are presented as income from discontinued operations, net of taxes on the Consolidated Statements of Operations and its assets and liabilities as of November 30, 2020 are presented as discontinued operations in the Consolidated Balance Sheets.

The historical statements of comprehensive income, cash flows and the balances in stockholders' equity have not been revised to reflect the effect of the Separation.

For further information on discontinued operations, see Note 5 – Discontinued Operations.

Unless noted otherwise, discussion in the Notes to the Consolidated Financial Statements pertain to continuing operations.

In connection with the Separation, the Company and Concentrix have entered into a separation and distribution agreement as well as various other agreements that provide a framework for the relationships between the parties going forward, including among others an employee matters agreement, a tax matters agreement, and a commercial agreement, pursuant to which C oncentrix will continue to provide services to SYNNEX following the Separation .

On March 22, 2021, SYNNEX entered into an agreement and plan of merger (the “Merger Agreement”) which provided that legacy SYNNEX Corporation would acquire legacy Tech Data Corporation, a Florida corporation (“Tech Data”) through a series of mergers, which would result in Tech Data becoming an indirect subsidiary of TD SYNNEX Corporation.

(collectively, the "Merger").

On September 1, 2021, pursuant to the terms of the Merger Agreement, the Company acquired all the outstanding shares of common stock of Tiger Parent (AP) Corporation, the parent corporation of Tech Data, for consideration of $ 1.61 billion in cash ($ 1.11 billion in cash after giving effect to a $ 500 million equity contribution by Tiger Parent Holdings, L.P., Tiger Parent (AP) Corporation’s sole stockholder and an affiliate of Apollo Global Management, Inc., to Tiger Parent (AP) Corporation prior to the effective time of the Merger) and 44 million shares of common stock of SYNNEX valued at approximately $ 5.61 billion.

The combined company is referred to as TD SYNNEX.

References to the “Company” indicate TD SYNNEX for periods after the Merger and SYNNEX for periods prior to the Merger.

Certain columns and rows may not add due to the use of rounded numbers.

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The COVID-19 pandemic has negatively impacted the global economy, disrupted global supply chains and work force participation and created volatility and disruption of financial markets, the impact of which was most acute during the second quarter of fiscal year 2020.

As of November 30, 2020, due to the ongoing impact of the COVID-19 pandemic on the Company’s business, many of the estimates and assumptions required increased judgment and carry a higher degree of variability and volatility.

As events continue to evolve and additional information becomes available, these estimates may change in future periods.

Despite improvements in the global economy since the onset of the pandemic, the emergence of the Delta and Omicron variants and other mutations bring uncertainty to continued economic recovery.

As a result, the Company cannot at this time accurately predict what effects these conditions will have on its operations and financial condition, including due to the uncertainties relating to the severity and duration of the pandemic, the effect on its customers and customer demand and the length of the restrictions and closures imposed by various governments.

Consequently, many of the estimates and assumptions required increased judgment and carry a higher degree of variability and volatility.

As events continue to

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evolve and additional information becomes available, these estimates may change in future periods.

Actual results could differ from the estimates.

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Investments in less than 20 % owned companies, where the Company does not have significant influence, are recorded at cost or fair value based on whether the equity securities have readily determinable fair values.

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Segment reporting

Operating segments are based on components of the Company that engage in business activity that earn revenue and incur expenses and (a) whose operating results are regularly reviewed by the Company’s chief operating decision maker to make decisions about resource allocation and performance and (b) for which discrete financial information is available.

The Company has two reportable segments:

Prior to the Separation, the Company had two reportable segments:

Technology Solutions and Concentrix.

The Technology Solutions segment represents an aggregation of the Technology Solutions United States, Canada, Japan and Latin America operating segments.

The Technology Solutions segment distributes peripherals, IT systems, including data center servers, system components, software, networking, communications and security equipment, consumer electronics (“CE”) and complementary products to a variety of customers, including value-added resellers, system integrators and retailers.

The segment also designs and integrates data center equipment built specific to the customers' data center environment.

The Concentrix segment offers a range of technology-infused global business outsourcing services focused on customer experience, process optimization and front and back-office automation to clients in five industry verticals.

The portfolio of services offered comprises end-to-end process outsourcing services that are delivered through omni-channels including both voice and non-voice.

After giving effect to the Separation of the Concentrix segment, the Company operated with one reportable segment:

Technology Solutions.

After completion of the Merger, the Company reviewed its reportable segments as there was a change in its chief executive officer, who is also the Company’s chief operating decision maker.

The Company’s chief operating decision maker has a leadership structure aligned with the geographic locations of the Americas, Europe and Asia-Pacific and Japan (“APJ”) and reviews and allocates resources based on these geographic locations.

As a result, as of September 1, 2021 the Company began operating in three reportable segments based on its geographic locations:

the Americas, Europe and APJ.

Cash and cash equivalents

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The Company is exposed to credit risk in the event of default by financial institutions to the extent that cash balances with financial institutions are in excess of amounts that are insured.

Allowance for doubtful accounts

The allowance for doubtful accounts is an estimate to cover the losses resulting from uncertainty regarding collections from customers or original equipment manufacturer (“OEM”) vendors to make payments for outstanding balances.

In estimating the required allowance, the Company takes into consideration the overall quality and aging of the accounts receivable, credit evaluations of customers’ financial condition and existence of credit insurance.

The Company also evaluates the collectability of accounts receivable based on specific customer or OEM vendor circumstances, current economic trends, historical experience with collections and any value and adequacy of collateral received from customers.

Accounts receivable

The Company maintains an allowance for doubtful accounts as an estimate to cover the future expected credit losses resulting from uncertainty regarding collections from customers or original equipment manufacturer (“OEM”) vendors to make payments for outstanding balances.

In estimating the required allowance, the Company takes into consideration historical credit losses, current conditions and reasonable and supportable forecasts.

Adjustments to historical loss information are made for differences in current conditions as well as changes in forecasted macroeconomic conditions, such as changes in unemployment rates or gross domestic product growth.

Expected credit losses are estimated on a pool basis when similar risk characteristics exist using an age-based reserve model.

Receivables that do not share risk characteristics are evaluated on an individual basis.

The Company has uncommitted supply-chain financing programs with global financial institutions under which trade accounts receivable of certain customers and their affiliates may be acquired, without recourse, by the financial institutions.

Available capacity under these programs is dependent on the level of the Company’s trade accounts receivable with these customers and the financial institutions’ willingness to purchase such receivables.

In addition, certain of these programs also require that the Company continue to service, administer and collect the sold accounts receivable.

As of November 30, 2021, and 2020, accounts receivable sold to and held by the financial institutions under these programs were $ 759,884 and $ 15,572 , respectively.

Discount fees related to the sale of trade accounts receivable under these facilities are included in “Interest expense and finance charges, net” in the Consolidated Statements of Operations.

During the fiscal years ended November 30, 2021, 2020 and 2019, discount fees were $ 4,669 , $ 3,176 and $ 2,256 , respectively.

Inventories are stated at the lower of cost and net realizable value.

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Work-in-process inventories are not material to the Consolidated Financial Statements.

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Derivative Financial Instruments

The Company accounts for its derivative instruments as either assets or liabilities and carries them at fair value.

For derivative instruments that hedge the exposure to variability in expected future cash flows that are designated as cash flow hedges, the gain or loss on the derivative instrument is reported as a component of “Accumulated other comprehensive income (loss)” in stockholders’ equity and reclassified into earnings in the same line associated with the forecasted transactions, in the same period or periods during which the hedged transaction affects earnings.

For derivative instruments that hedge the exposure to variability in expected future cash flows that are designated as cash flow hedges, the gain or loss on the derivative instrument is reported as a component of “Accumulated other comprehensive income (loss)” in stockholders’ equity and reclassified into earnings in the same line associated with the hedged transactions, in the same period or periods during which the hedged transaction affects earnings.

To receive hedge accounting treatment, cash flow hedges must be highly effective in offsetting changes to expected future cash flows on hedged transactions.

For derivative instruments that are not designated as hedges, gains and losses on derivative instruments are reported in the Consolidated Statements of Operations in the current period.

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For derivative instruments that are not designated as hedges, gains and losses resulting from changes in fair value on derivative instruments are reported in the Consolidated Statements of Operations in the current period.

Property and equipment

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When assets are retired or otherwise disposed of, the cost and accumulated depreciation and amortization are removed from the accounts and any resulting gain or loss is reflected in operations in the period realized.

The Company’s capitalized software has been obtained or developed for internal use only.

Development and acquisition costs are capitalized for computer software only when management authorizes and commits to funding a computer software project through the approval of a capital expenditure requisition, and the software project is either for the development of new software, to increase the life of existing software or to add significantly to the functionality of existing software.

Once these requirements have been met, capitalization would begin at the point that conceptual formulation, evaluation, design and testing of possible software project alternatives have been completed.

Capitalization ceases when the software project is substantially complete and ready for its intended use.

The ranges of estimated useful lives for property and equipment categories are as follows:

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Goodwill and intangible assets

The values assigned to intangible assets are based on estimates and judgment regarding expectations for the success and life cycle of products and technologies and length of customer relationships acquired in a business combination.

Purchased intangible assets are amortized over the useful lives based on estimates of the use of the economic benefit of the asset or on the straight-line amortization method.

The values assigned to intangible assets include estimates and judgment regarding expectations for the length of customer relationships acquired in a business combination.

Included within intangible assets is an indefinite lived trade names intangible asset.

Indefinite lived intangible assets are tested for impairment annually and more frequently if events or changes in circumstances indicate that it is more likely than not that the asset is impaired.

Other purchased intangible assets are amortized over the useful lives based on estimates of the use of the economic benefit of the asset or on the straight-line amortization method.

The Company allocates goodwill to reporting units based on the reporting unit expected to benefit from the business combination and tests for impairment annually in the fourth quarter or more frequently if events or changes in circumstances indicate that it may be impaired.

Goodwill is tested for impairment at the reporting unit level by first performing a qualitative assessment to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying value.

The factors that are considered in the qualitative analysis include macroeconomic conditions, industry and market considerations, cost factors such as increases in product cost, labor, or other costs that would have a negative effect on earnings and cash flows;

The factors that are considered in the qualitative analysis include macroeconomic conditions, industry and market considerations, cost factors such as

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increases in product cost, labor, or other costs that would have a negative effect on earnings and cash flows;

and other relevant entity-specific events and information.

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No goodwill impairment has been identified for any of the years presented.

Intangible assets consist primarily of customer relationships and lists, vendor lists, technology and trade names.

Definite-lived intangible assets consist primarily of customer relationships and lists, vendor lists and other intangible assets.

Amortization is based on the pattern in which the economic benefits of the intangible assets will be consumed or on a straight-line basis when the consumption pattern is not apparent over the following useful lives:

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Impairment of long-lived assets

The Company reviews the recoverability of its long-lived assets, such as intangible assets, property and equipment and certain other assets, when events or changes in circumstances occur that indicate the carrying value of the asset or asset group may not be

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The Company reviews the recoverability of its long-lived assets, such as definite-lived intangible assets, property and equipment and certain other assets, when events or changes in circumstances occur that indicate the carrying value of the asset or asset group may not be recoverable.

The assessment of possible impairment is based on the Company’s ability to recover the carrying value of the asset or asset group from the expected future pre-tax cash flows, undiscounted and without interest charges, of the related operations.

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The Company enters into leases as a lessee for property and equipment in the ordinary course of business.

When procuring goods or services, or upon entering into a contract with its customers and clients, the Company determines whether an arrangement contains a lease at its inception.

When procuring goods or services, or upon entering into a contract with its customers, the Company determines whether an arrangement contains a lease at its inception.

As part of that evaluation, the Company considers whether there is an implicitly or explicitly identified asset in the arrangement and whether the Company, as the lessee, or the customer, if the Company is the lessor, has the right to control the use of that asset.

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Operating leases are included in other assets, net, other accrued liabilities and other long-term liabilities in the Consolidated Balance Sheet.

Finance leases are included in property and equipment, net, borrowings, current and long-term borrowings in the Consolidated Balance Sheet.

Substantially all of the Company's leases are classified as operating leases.

Substantially all of the Company's leases are classified as operating leases and the Company’s finance leases are not material.

The lease term includes options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option.

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Operating lease payments are presented within “Cash flows from operating activities” in the Consolidated Statements of Cash Flows.

For all asset classes, the Company has elected the lessee practical expedient to combine lease and non-lease components (e.g., maintenance services) and account for the combined unit as a single lease component.

Variable lease payments are recognized in the period in which the obligation for those payments is incurred.

Concentration of credit risk

Financial instruments that potentially subject the Company to significant concentration of credit risk consist principally of cash and cash equivalents, accounts receivable and derivative instruments.

The Company’s cash and cash equivalents and derivative instruments are transacted and maintained with financial institutions with high credit standing, and their compositions and maturities are regularly monitored by management.

Through November 30, 2020, the Company has not experienced any credit losses on such deposits and derivative instruments.

Through November 30, 2021, the Company has not experienced any material credit losses on such deposits and derivative instruments.

Accounts receivable include amounts due from customers, including related party customers.

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The Company also maintains allowances for potential credit losses.

In estimating the required allowances, the Company takes into consideration the overall quality and aging of its receivable portfolio, the existence of a limited amount of credit insurance and specifically identified customer and vendor risks.

Through November 30, 2020, such losses have been within management’s expectations.

One customer accounted for 19 % of the Company’s consolidated revenue in fiscal years 2020 and 2019 and 17 % of the Company’s consolidated revenue in fiscal year 2018.

Products purchased from the Company’s largest OEM supplier, HP Inc., accounted for approximately 12 % of the Company’s consolidated revenue during fiscal years 2020 and 2019 and approximately 13 % of consolidated revenue during fiscal year 2018.

As of November 30, 2020 and 2019, one customer comprised 11 % and 19 %, respectively, of the consolidated accounts receivable balance.

In estimating the required allowances, the Company

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takes into consideration the overall quality and aging of its receivable portfolio, the existence of credit insurance and specifically identified customer and vendor risks.

The Company also considers risks attributed to COVID-19 in establishing the required allowances.

One customer accounted for 17 %, 23 % and 24 % of the Company’s total revenue in fiscal years 2021, 2020 and 2019, respectively.

Products purchased from the Company’s largest OEM supplier, HP Inc., accounted for approximately 12 %, 15 % and 14 % of the Company’s total revenue during fiscal years 2021, 2020 and 2019, respectively.

As of November 30, 2021, no single customer comprised more than 10% of the consolidated accounts receivable balance.

As of November 30, 2020, one customer comprised 15 % of the consolidated accounts receivable balance.

Book overdrafts

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The Company’s policy is to report the change in book overdrafts as a financing activity in the Consolidated Statements of Cash Flows.

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Revenue recognition

The Company generates revenue primarily from (i) the sale of various IT products through its Technology Solutions business unit and (ii) the provision of business outsourcing services focused on customer experience through its Concentrix business unit.

Products revenue represents revenue from the Company’s Technology Solutions segment and services revenue represents revenue from the Company’s Concentrix segment.

Technology Solutions

The Company generates revenue primarily from the sale of various IT products.

The Company recognizes revenues from the sale of IT hardware and software as control is transferred to customers, which is at the point in time when the product is shipped or delivered.

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Payments are due as per contract terms and do not contain a significant financing component.

Service revenues represents less than 10 % of the total revenue for the periods presented.

Provisions for sales returns and allowances are estimated based on historical data and are recorded concurrently with the recognition of revenue.

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The Company recognizes revenue on a net basis on certain contracts, where the Company’s performance obligation is to arrange for the products or services to be provided by another party or the rendering of logistics services for the delivery of inventory for which the Company does not assume the risks and rewards of ownership, by recognizing the margins earned in revenue with no associated cost of revenue.

Such arrangements, which are not material to the Company’s consolidated revenue or its “Products” or “Services” revenue, include supplier service contracts, post-contract software support services and extended warranty contracts.

Such arrangements include supplier service contracts, post-contract software support services and extended warranty contracts.

The Company considers shipping and handling activities as costs to fulfill the sale of products.

Shipping revenue is included in revenue when control of the product is transferred to the customer, and the related shipping and handling costs are included in cost of products sold.

The Company recognizes revenue from services contracts over time as the promised services are delivered to clients for an amount that reflects the consideration to which the Company is entitled in exchange for those services.

The Company accounts for a contract with a customer when it has written approval, the contract is committed, the rights of the parties, including payment terms, are identified, the contract has commercial substance and consideration is probable of collection.

Revenue is presented net of taxes collected from customers and remitted to government authorities.

The Company generally invoices a customer after performance of services or in accordance with specific contractual provisions.

Service contracts may be based on a fixed price or on a fixed unit-price per transaction or other objective measure of output.

The Company determines whether the services performed during the initial phases of an arrangement, such as setup activities, are distinct.

In most cases, the arrangement is a single performance obligation comprised of a series of distinct services that are substantially the same and that have the same pattern of transfer (i.e., distinct days of service).

The Company records deferred revenue attributable to certain process transition, setup activities where such activities do not represent separate performance obligations.

Billings related to such transition activities are classified under contract liabilities and subsequently recognized ratably over the period in which the related services are performed.

The Company applies a measure of progress (typically time-based) to any fixed consideration and allocates variable consideration to the distinct periods of service based on usage.

As a result, revenue is generally recognized over the period the services are provided on a usage basis.

This results in revenue recognition that corresponds with the benefit to the client of the services transferred to date relative to the remaining services promised.

Revenue on fixed price contracts is recognized on a straight-line basis over the term of the contract as services are provided.

Revenue on unit-price transactions is recognized using an objective measure of output including staffing hours or the number of transactions processed by service agents.

Client contract terms can range from less than one year to more than five years.

The Company generally invoices a customer after performance of services, or in accordance with specific contractual provisions.

Payments are due as per contract terms and do not contain a significant financing component.

Certain client contracts include incentive payments from the customer upon achieving certain agreed-upon service levels and performance metrics or service level agreements that could result in credits or refunds to the client.

Revenue relating to such

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arrangements is accounted for as variable consideration when the likely amount of revenue to be recognized can be estimated to the extent that it is probable that a significant reversal of any incremental revenue will not occur.

Deferred revenue contract liabilities and deferred costs to obtain or fulfill a contract are not material.

Disaggregated revenue disclosure is presented in Note 11 .

Shipping revenue is included in revenue when control of the product is transferred to the customer, and the related shipping and handling costs are included in cost of revenue.

The Company disaggregates its operating segment revenue by geography, which the Company believes provides a meaningful depiction of the nature of its revenue.

Disaggregated revenue disclosure is presented in Note 13 – Segment Information.

Cost of Revenue

Cost of products revenue represents cost of the Company’s Technology Solutions segment and cost of services revenue represents cost of the Company’s Concentrix segment.

Technology Solutions

Cost of revenue includes the product price paid to OEM suppliers, net of any incentives, rebates, price protection and purchase discounts received from the OEM suppliers.

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In addition, cost of revenue includes the cost of materials, labor and overhead and warranty for design and integration activities.

Recurring direct operating costs for services are recognized as incurred.

Cost of services revenue consists primarily of personnel costs.

Where a contract requires an up-front investment, which typically includes transition and set-up costs related to systems and processes, these amounts are deferred and amortized on a straight-line basis over the expected period of benefit, not to exceed the fixed term of the contract.

The Company performs periodic reviews to assess the recoverability of deferred contract transition and setup costs.

This review is done by comparing the estimated minimum remaining undiscounted cash flows of a contract to the unamortized contract costs.

If such minimum undiscounted cash flows are not sufficient to recover the unamortized costs, an impairment loss is recognized for the difference between the estimated fair value and the carrying value.

If a cash flow deficiency remains after reducing the carrying amount of the deferred costs, the Company evaluates any remaining long-lived assets related to that contract for impairment.

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Selling, General and Administrative expenses

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General and administrative expenses include such items as compensation, cost of warehouse, delivery centers and other non-integration facilities, legal and professional costs, office supplies, non-income taxes, insurance and utility expenses.

In addition, selling, general and administrative expenses include other operating items such as allowances for credit losses, depreciation and amortization of non-technology related intangible assets.

In addition, selling, general and administrative expenses include other operating items such as allowances for credit losses, depreciation and amortization of intangible assets.

OEM supplier programs

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however, the Company does warrant the following:

(1) products that it builds to order from components purchased from other sources;

and (2) its services with regard to products that it assembles for its customers.

(1) products that it builds to order from components purchased from other sources, (2) services with regard to products integrated for its customers;

and (3) products sold in countries where the Company is responsible for defective product as a matter of law.

The time period required by law in certain countries exceeds the warranty period provided by the manufacturer.

The Company is obligated to provide warranty protection for sales of certain IT products within the European Union (“EU”) for up to two years as required under the EU directive where vendors have not affirmatively agreed to provide pass-through protection.

Warranty expense and the accrual for warranty costs were not material to the Company’s Consolidated Financial Statements for any of the periods presented.

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Costs related to advertising and product promotion expenditures are charged to “Selling, general and administrative expenses” as incurred and are primarily offset by OEM marketing reimbursements.

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assets and liabilities at the exchange rate as of the balance sheet date, stockholders’ equity at the historical rates of exchange, and income and expense amounts at the average exchange rate for the month.

Translation adjustments resulting from the translation of the subsidiaries’ accounts are included in “Accumulated other comprehensive income (loss)” in stockholders’ equity.

Translation adjustments resulting from the translation of the subsidiaries’ accounts are included in “Accumulated other comprehensive

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income (loss)” in stockholders’ equity.

Transactions denominated in currencies other than the applicable functional currency are converted to the functional currency at the exchange rate on the transaction date.

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Non-monetary assets and liabilities are remeasured at historical exchange rates.

Gains and losses resulting from foreign currency transactions are included in earnings within “Other income (expense), net.”

Gains and losses resulting from foreign currency transactions are included in earnings within “Cost of revenue” and “Other income (expense), net.”

Comprehensive income

Comprehensive income is defined as the change in equity of a business enterprise during a period from transactions and other events and circumstances from non-owner sources.

The primary components of comprehensive income for the Company include net income, foreign currency translation adjustments arising from the consolidation of the Company’s international subsidiaries, unrealized gains and losses on the Company’s available-for-sale debt securities, unrealized gains and losses on cash flow hedges and the changes in unrecognized pension and post-retirement benefits.

Share-based compensation

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The Company accounts for expense reductions that result from the forfeiture of unvested awards in the period that the forfeitures occur.

Pension and post-retirement benefits

The funded status of the Company’s pension and other postretirement benefit plans is recognized in the Consolidated Balance Sheets.

The funded status is measured as the difference between the fair value of plan assets and the benefit obligation at November 30, the measurement date.

For defined benefit pension plans, the benefit obligation is the projected benefit obligation ("PBO") and, for the other postretirement benefit plans, the benefit obligation is the accumulated postretirement benefit obligation ("APBO").

The PBO represents the actuarial present value of benefits expected to be paid upon retirement.

For active plans, the present value reflects estimated future compensation levels.

The APBO represents the actuarial present value of postretirement benefits attributed to employee services already rendered.

The fair value of plan assets represents the current market value of assets held by an irrevocable trust fund for the sole benefit of participants.

The measurement of the benefit obligation is based on the Company’s estimates and actuarial valuations.

These valuations reflect the terms of the plans and use participant-specific information such as compensation, age and years of service, as well as certain key assumptions that require significant judgment, including, but not limited to, estimates of discount rates, expected return on plan assets, inflation, rate of compensation increases, interest crediting rates

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and mortality rates.

The assumptions used are reviewed on an annual basis.

The Company records components other than the service cost component in Other income (expense), net in the Consolidated Statement s of Operations.

Earnings per common share

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Reclassifications

Certain reclassifications have been made to prior period amounts in the Consolidated Statements of Cash Flows to conform to current period presentation.

These reclassifications had no effect on cash flows from operating, investing or financing activities as previously reported.

Certain reclassifications have been made to prior period amounts in the Consolidated Financial Statements to conform to the current period presentation.

These reclassifications did not have a material impact on previously reported amounts.

Recently adopted accounting pronouncements

In February 2018, the Financial Accounting Standard Board (the “FASB”) issued guidance that permits the Company to reclassify disproportionate tax effects in accumulated other comprehensive income caused by the Tax Cuts and Jobs Act of 2017 (the “TCJA”) to retained earnings.

The guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018, with early adoption permitted.

In August 2018, the Financial Accounting Standard Board (“FASB”) issued new guidance to add, remove, and clarify disclosure requirements related to defined benefit pension and other postretirement plans.

The amendment requires the Company to disclose the weighted-average interest crediting rates used in cash balance pension plans.

It also requires the Company to disclose the reasons for significant changes in the benefit obligation or plan assets including significant gains and losses affecting the benefit obligation for the period.

The adoption of this new guidance did not have a material impact on the Company's Consolidated Financial Statements.

In February 2016, the FASB issued a new standard which revises various aspects of accounting for leases, with amendments in 2018 and 2019 codified as Accounting Standards Codification Topic 842, Leases.

The Company adopted the guidance effective December 1, 2019 , applying the optional transition method, which allows an entity to apply the new standard at the adoption date with a cumulative effect adjustment to the opening balance of retained earnings in the period of adoption.

In addition, the Company elected the package of practical expedients not to reassess prior conclusions related to contracts containing leases, lease classification and initial direct costs and the lessee practical expedient to combine lease and non-lease components for all asset classes.

The Company made a policy election to not recognize ROU assets and lease liabilities for short-term leases for all asset classes.

The most significant impact of adoption to the Company’s Consolidated Financial Statements relates to the recognition of a right-of-use asset and a lease liability for its leases other than short-term leases.

The liability was equal to the present value of lease payments.

The asset is based on the liability, and subject to adjustment, such as for initial direct costs.

The recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee depends primarily on its classification.

For income statement purposes, operating leases will result in a straight-line expense while finance leases will result in a front-loaded expense pattern.

Upon adoption, the Company recorded $ 591,129 of ROU assets and of $ 642,567 of liabilities relating to its operating leases on its Consolidated Balance Sheet.

The adoption did no t have an impact on the Company’s retained earnings as of December 1, 2019, its consolidated statements of operations or its consolidated statements of cash flows.

In August 2018, the FASB issued guidance to improve the effectiveness of fair value measurement disclosures by removing or modifying certain disclosure requirements and adding other requirements.

Certain amendments should be applied prospectively, while all other amendments should be applied retrospectively to all periods presented.

This guidance was applicable to the Company at the beginning of fiscal year 2021 and its adoption did not have a material impact on the Company's Consolidated Financial Statements.

In June 2016, the FASB issued a new credit loss standard to replace the incurred loss impairment methodology.

The new impairment model requires immediate recognition of estimated credit losses expected to occur for most financial assets and certain other instruments.

This new standard is to be adopted by way of a cumulative-effect adjustment to retained earnings as of the beginning of the first effective reporting period.

This guidance was applicable to the Company at the beginning of fiscal year 2021 and its adoption did not have a material impact on the Company's Consolidated Financial Statements.

Recently issued accounting pronouncements

In October 2021, the FASB issued new guidance which requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with ASC 606, “ Revenue from

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Contracts with Customers.

” Generally, this new guidance will result in the acquirer recognizing contract assets and contract liabilities at the same amounts recorded by the acquiree.

Historically, such amounts were recognized by the acquirer at fair value in acquisition accounting.

The guidance is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years (the fiscal quarter ending February 28, 2023 for the Company), and should be applied prospectively to acquisitions occurring on or after the effective date.

Early ad option is permitted.

The Company has not yet adopted this standard and will evaluate the impact of the new standard on future acquisitions.

In March 2020, the FASB issued optional guidance for a limited time to ease the potential burden in accounting for or recognizing the effects of reference rate reform, particularly, the risk of cessation of the London Interbank Offered Rate (“LIBOR”) on financial reporting.

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The amendments are elective and are effective upon issuance for all entities through December 31, 2022.

The Company is currently evaluating the impact of the new guidance.

The Company does not currently expect any material impacts from the adoption of this new guidance.

In December 2019, the FASB issued new guidance that simplifies the accounting for income taxes.

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Certain amendments should be applied prospectively, while other amendments should be applied retrospectively to all periods presented.

The Company is currently evaluating the impact of the new guidance.

In August 2018, the FASB issued new guidance to add, remove, and clarify disclosure requirements related to defined benefit pension and other postretirement plans.

The amendment requires the Company to disclose the weighted-average interest crediting rates used in cash balance pension plans.

This standard is effective for fiscal years ending after December 15, 2020 and early adoption is permitted.

The adoption is not expected to have a material impact on the Company's Consolidated Financial Statements.

In August 2018, the FASB issued guidance to improve the effectiveness of fair value measurement disclosures by removing or modifying certain disclosure requirements and adding other requirements.

Certain amendments should be applied prospectively, while

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all other amendments should be applied retrospectively to all periods presented.

Th is guidance is applicable to the Company at the beginning of fiscal year 2021 and its adoption is not expected to have a material impact on the Company's Consolidated Financial Statements .

In June 2016, the FASB issued a new credit loss standard that replaces the incurred loss impairment methodology in current GAAP.

The new impairment model requires immediate recognition of estimated credit losses expected to occur for most financial assets and certain other instruments.

This new standard is to be adopted by way of a cumulative-effect adjustment to retained earnings as of the beginning of the first effective reporting period.

This guidance is applicable to the Company at the beginning of fiscal year 2021 and its adoption is not expected to have a material impact on the Company's Consolidated Financial Statements.

NOTE 3—STOCKHOLDERS’ EQUITY:

Stock incentive plans

The Company’s stock incentive plans include plans adopted in 2020, 2013 and 2003 (the SYNNEX Plan(s)”).

The SYNNEX Plans, as amended, provide for the direct award or sale of shares of common stock, restricted stock awards, and restricted stock units, the grant of options to purchase shares of common stock and the award of stock appreciation rights to employees and non-employee directors and consultants.

The number of authorized shares under the 2020 SYNNEX Plan will not exceed the sum of 2,493 shares of common stock, plus any shares under the amended and restated 2013 and 2003 SYNNEX Plans that are subject to outstanding awards granted to the extent those awards expire, terminate or are canceled for any reason prior to exercise without the issuance or delivery of such shares, any shares subject to vesting restrictions that are subsequently forfeited, and any reserved shares not issued or subject to outstanding awards, up to 3,950 shares.

No further grants may be made under the 2013 or 2003 SYNNEX Plans and a ll outstanding awards under the 2013 and 2003 Plans continue to be governed by their existing terms.

The Company does not currently expect any material impacts from the adoption of this new guidance.

NOTE 3—ACQUISITIONS:

Tech Data Merger

On September 1, 2021, pursuant to the terms of the Merger Agreement, the Company acquired all the outstanding shares of common stock of Tiger Parent (AP) Corporation, the parent corporation of Tech Data, for an aggregate purchase price of $ 7.22 billion, comprised of $ 1.61 billion in cash ($ 1.11 billion in cash after giving effect to a $ 500 million equity contribution by Tiger Parent Holdings, L.P., Tiger Parent (AP) Corporation’s sole stockholder and an affiliate of Apollo Global Management, Inc., to Tiger Parent (AP) Corporation prior to the effective time of the Merger) and 44 million shares of common stock of SYNNEX, valued at approximately $ 5.61 billion based on the closing price of the Company’s common stock on September 1, 2021.

The Merger created a leading global distributor and solutions aggregator for the IT ecosystem.

The Company used the net proceeds from the issuance of new Senior Notes, borrowings under its new credit agreement and cash on hand to fund the above payments.

Additionally, the Company repaid the majority of Tech Data's outstanding debt after the Merger, including approximately $ 2.4 billion outstanding under Tech Data’s existing Asset-Based Credit Agreement and approximately $ 0.2 billion of outstanding Tech Data Senior Notes.

The Company has accounted for the Merger as a business combination and allocated the purchase price to the estimated fair values of Tiger Parent (AP) Corporation’s assets acquired and liabilities assumed.

As the Merger occurred during the fourth quarter of the Company’s fiscal year, the Company has not yet completed its evaluation and determination of certain assets acquired and liabilities assumed, primarily (i) the final assessment and valuation of certain assets acquired and liabilities assumed, including accounts receivable, receivables from vendors, inventory, accrued expenses and other liabilities and (ii) the final assessment and valuation of certain income tax amounts .

Therefore, the final fair values of the assets and liabilities may vary from the Company's preliminary estimates.

The preliminary allocation of the purchase price is as follows:

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Purchase price allocation:

Cash and cash equivalents

Accounts receivable, net

Receivables from vendors, net

Other current assets

Property and equipment

Intangible assets

Borrowings, current

Accounts payable

Other accrued liabilities

Long-term borrowings

Other long-term liabilities

Deferred tax liabilities

Total liabilities

Purchase consideration

The allocation of the value of identifiable intangible assets is as follows:

Customer relationships

Indefinite lived

Total intangibles acquired

Goodwill is the excess of the consideration transferred over the net assets recognized and primarily represents future economic benefits arising from assets acquired that are not individually identified and separately recognized, including synergies inherent in the acquired business, of which approximately $ 500 million is expected to be deductible for tax purposes .

Included within the Company’s Consolidated Statement of Operations are estimated revenues for the year ended November 30, 2021, of approximately $ 10.0 billion from Tech Data subsequent to the acquisition date of September 1, 2021.

As the Company began integrating certain sales and other functions after the closing of the acquisition, these amounts represent an estimate of the Tech Data revenues for the fiscal year ended November 30, 2021.

It is not necessarily indicative of how the Tech Data operations would have performed on a stand-alone basis.

As a result of certain integration activities subsequent to the date of acquisition, it is impracticable to disclose net income from Tech Data for the period subsequent to the acquisition date.

The following table presents unaudited supplemental pro forma information as if the Merger had occurred at the beginning of fiscal 2020, after giving effect to certain adjustments related to the transaction.

The pro forma results exclude any benefits that may result from potential cost savings and certain non-recurring costs.

As a result, the pro forma information below does not purport to present what actual results would have been had the Merger been consummated on the date indicated and it is not necessarily indicative of the results of operations that may result in the future.

Years Ended November 30,

Income from continuing operations attributable to TD SYNNEX Corporation

Adjustments reflected in the pro forma results include the following:

Amortization of acquired intangible assets

Interest costs associated with the Merger

Removal of certain non-recurring transaction costs of $ 22.3 million and non-recurring financing costs of $ 47.0 millio n

Tax effects of adjustments based on an estimated statutory tax rate

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NOTE 4—ACQUISTION, INTEGRATION AND RESTRUCTURING EXPENSES:

Acquisition, integration and restructuring costs are primarily comprised of costs related to the Merger, costs related to the Global Business Optimization 2 Program initiated by Tech Data prior to the Merger (the “GBO 2 Program”) and costs related to the Separation.

The Company incurred acquisition, integration and restructuring costs related to the completion of the Merger, including professional services costs, personnel and other costs, an impairment of long-lived assets and stock-based compensation expense.

Professional services costs are primarily comprised of legal expenses and tax and other consulting services.

Personnel and other costs are primarily comprised of costs related to the settlement of c ertain outstanding long-term cash incentive awards for Tech Data upon closing of the Merger, retention and other bonuses, as well as severance costs.

Impairment of long-lived assets relates to a charge of $ 22.2 million recorded for the write-off of capitalized costs associated with Tech Data’s tdONE program in conjunction with the decision to consolidate certain IT systems.

Stock-based compensation expense primarily relates to costs associated with the conversion of certain Tech Data performance-based equity awards issued prior to the Merger into restricted stock units of TD SYNNEX (refer to Note 6 – Share Based Compensation for further information) and expenses for certain restricted stock awards issued in conjunction with the Merger.

To date, acquisition and integration expenses related to the Merger were composed of the following:

Year Ended November 30,

Professional services costs

Personnel and other costs

Impairment of long-lived assets

Stock-based compensation

GBO 2 Program

Prior to the Merger, Tech Data implemented its GBO 2 Program that includes investments to optimize and standardize processes and apply data and analytics to be more agile in a rapidly evolving environment, increasing productivity, profitability and optimizing net-working capital.

TD SYNNEX plans to continue this program in conjunction with the Company’s integration activities.

Acquisition, integration and restructuring expenses related to the GBO 2 Program are primarily comprised of restructuring costs and other professional services costs.

Restructuring costs are comprised of severance costs and other associated exit costs, including certain consulting costs.

Other professional services costs are primarily comprised of professional services fees not related to restructuring activities, including costs related to improving profitability and optimizing net-working capital.

Acquisition, integration and restructuring costs under the GBO2 Program for fiscal 2021 included the following:

Year Ended November 30,

Restructuring costs

Other professional services costs

Restructuring costs under the GBO 2 Program for fiscal 2021 were composed of the following:

Year Ended November 30,

Other exit costs

During fiscal 2021, the Company recorded restructuring costs related to GBO 2 of $ 2,658 , $ 5,746 and $ 305 , for the Americas, Europe and APJ regions, respectively.

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Restructuring activity during fiscal 2021 related to the GBO 2 Program is as follows:

Restructuring costs

Severance and Benefits

Other Exit Costs

Accrued Balance as of November 30, 2020

Balance acquired related to the Merger

Expenses during fiscal 2021

Cash payments

Foreign currency translation

Accrued Balance as of November 30, 2021

The Separation

During the fiscal year ended November 30, 2020, the Company incurred $ 7,414 in transaction costs related to the Separation of Concentrix.

NOTE 5—DISCONTINUED OPERATIONS:

The following table summarizes the financial results from discontinued operations of Concentrix included in the Consolidated Statement of Operations:

Fiscal Years Ended November 30

Costs and expenses

Interest expense and finance charges and others, net

Income from discontinued operations before taxes

Provision for income taxes

Income from discontinued operations, net of taxes

There were no revenues earned or cost and expenses incurred of discontinued operations during the fiscal year ended November 30, 2021.

There were no non-cash items or capital expenditures of discontinued operations during the fiscal year ended November 30, 2021.

During the fiscal years ended November 30, 2020 and 2019, significant non-cash items and capital expenditures of discontinued operations included in the Consolidated Statement of Cash Flows are outlined below:

Fiscal Years Ended November 30

Operating activities:

Depreciation and amortization

Share-based compensation

Provision for doubtful accounts

Deferred income taxes

Unrealized foreign exchange losses

Investing activities:

Purchases of property and equipment

The following table presents assets and liabilities that were transferred to Concentrix as of December 1, 2020 and presented as discontinued operations in the Consolidated Balance Sheet as of November 30, 2020:

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November 30, 2020

Cash and cash equivalents

Accounts receivable, net

Other current assets

Current assets of discontinued operations

Property and equipment, net

Intangible assets, net

Deferred tax assets

Noncurrent assets of discontinued operations

Borrowings, current

Accounts payable

Accrued compensation and benefits

Other accrued liabilities

Income taxes payable

Current liabilities of discontinued operations

Long-term borrowings

Other long-term liabilities

Deferred tax liabilities

Noncurrent liabilities of discontinued operations

In connection with the Separation, $ 3,813 of accumulated other comprehensive income, net of income taxes, related to foreign currency translation adjustments, cash flow hedges and pension plan obligations was transferred to Concentrix on the Separation date.

Refer to Note 8 - Balance Sheet Components for more information.

NOTE 6—SHARE-BASED COMPENSATION:

Overview of stock incentive plans

The Company’s stock incentive plans include plans adopted in 2020, 2013 and 2003 (the “TD SYNNEX Plan(s)”).

The TD SYNNEX Plans, as amended, provide for the direct award or sale of shares of common stock, restricted stock awards, and restricted stock units, the grant of options to purchase shares of common stock and the award of stock appreciation rights to employees and non-employee directors and consultants.

The number of authorized shares under the 2020 TD SYNNEX Plan will not exceed the sum of 2,493 shares of common stock, plus any shares under the amended and restated 2013 and 2003 TD SYNNEX Plans that are subject to outstanding awards granted to the extent those awards expire, terminate or are canceled for any reason prior to exercise without the issuance or delivery of such shares, any shares subject to vesting restrictions that are subsequently forfeited, and any reserved shares not issued or subject to outstanding awards, up to 3,950 shares, which was due to antidilution provisions in the 2020 TD SYNNEX Plan increased by 2,621 shares following the Separation.

No further grants may be made under the 2013 or 2003 TD SYNNEX Plans and a ll outstanding awards under the 2013 and 2003 Plans continue to be governed by their existing terms.

As of November 30, 2021, there were 4,555 shares of common stock available for future grants.

Under the Plans, qualified employees are eligible for the grant of incentive stock options to purchase shares of common stock.

Qualified employees and outside directors and consultants are eligible for the grant of non-qualified stock options, stock appreciation rights, restricted stock grants and restricted stock units.

The outstanding restricted stock awards and units generally vest one fifth ratably over a five-year period.

Certain restricted stock awards granted to employees vest at the end of a three year period and certain restricted stock awards and units granted to employees vest over a four year period with 67 % of the award scheduled to vest on the third anniversary and remaining 33 % scheduled to vest on the fourth anniversary.

Certain restricted stock units could vest subject to the achievement of individual, divisional or company-wide performance goals.

The outstanding restricted stock awards and units generally vest one fifth ratably over a five-year period, with certain awards subject to other vesting periods as defined per the grant agreement.

Certain restricted stock units vest subject to the achievement of individual, divisional or company-wide performance goals.

The majority of the performance-based restricted stock units vest at the end of three-year requisite service periods, subject to the achievement of company-wide financial performance goals approved by the Compensation Committee.

The exercise price for incentive stock options will not be less than 100 % of the fair market value of the stock on the date of grant and the stock options have a contractual term of ten years.

The outstanding stock options vest as to one fifth of the stock underlying the stock options on the first anniversary date of the grant and the remaining vest monthly over a four-year period starting one month after the first anniversary of the date of grant .

Stock options granted to qualified non-employee directors vest as to one third of the stock underlying the stock options on the first anniversary date of the grant and the remaining vest monthly over a two-year period starting one month after the first anniversary of the date of grant.

The majority of outstanding stock options vest as to one fifth of the stock underlying the stock options on the first anniversary date of the grant and the remaining vest monthly over a four-year period starting one month after the first anniversary of the date of grant .

Restricted stock granted to qualified non-employee directors vests one fourth on a quarterly basis over a one-year period.

The holders of restricted stock awards are entitled to the same voting, dividend and other rights as the Company’s common stockholders.

Unless terminated sooner, the 2020 SYNNEX Plan will terminate on March 17, 2030 .

Concentrix Stock Incentive Plan

In November 2020, in connection with the Separation, the Concentrix Stock Incentive Plan (the “Concentrix Incentive Plan”), was approved by SYNNEX as the sole stockholder of Concentrix to be effective upon completion of the Separation.

The number of authorized shares of Concentrix under the Concentrix Incentive Plan are 4,000 shares of Concentrix’ common stock .

2014 Employee Stock Purchase Plan

On January 6, 2014, the Board of Directors approved the adoption of the 2014 Employee Stock Purchase Plan (“2014 ESPP”) to succeed the Company's 2003 Employee Stock Purchase Plan.

The 2014 ESPP, as amended, commenced on January 1, 2015 with 750 authorized shares.

Under the 2014 ESPP, there are four offering periods of three months each in a calendar year.

Eligible employees in the United States can choose to have a fixed percentage deducted from their bi-weekly compensation to purchase the Company’s common stock at a discount of 5 %.

The maximum number of shares a participant may purchase is 0.625 during a single accumulation period subject to a maximum purchase limit of $ 10 in a calendar year.

Employees at associate vice president level and above are not eligible to participate in the plan.

Share-based compensation expense related to the 2014 ESPP was immaterial during fiscal years 2020, 2019 and 2018.

Share Repurchase Programs

In June 2020, the Board of Directors authorized a three-year $ 400,000 share repurchase program, effective July 1, 2020, pursuant to which the Company may repurchase its outstanding common stock from time to time in the open market or through privately negotiated transactions.

As of November 30, 2020, the Company had no t repurchased any shares under this program.

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In June 2017, the Board of Directors authorized a three-year $ 300,000 share repurchase program pursuant to which the Company could repurchase its outstanding common stock from time to time in the open market or through privately negotiated transactions.

Through the expiration of this program in June 2020, the Company had purchased 875 shares at a total cost of $ 84,577 .

The share purchases were made on the open market and the shares repurchased by the Company are held in treasury for general corporate purposes.

The Company declared cumulative cash dividends of $ 0.40 , $ 1.50 and $ 1.40 per share during the years ended November 30, 2020, 2019 and 2018, respectively.

On March 24, 2020, as a result of the unpredictable economic environment due to the impact of the COVID-19 pandemic, the Company announced the suspension of its quarterly dividend.

On January 11, 2021 , the Company announced the reinstatement of a quarterly cash dividend of $ 0.20 per share to stockholders of record as of January 22, 2021 , payable January 29, 2021 .

Dividends are subject to continued capital availability, compliance with the covenants and conditions in some of the Company's credit facilities and the declaration by the Board of Directors in the best interest of the Company’s stockholders.

NOTE 4—SHARE-BASED COMPENSATION:

Unless terminated sooner, the 2020 TD SYNNEX Plan will terminate on March 17, 2030.

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The Company recognizes share-based compensation expense for all share-based awards made to employees and directors, including employee stock options, restricted stock awards, restricted stock units, performance-based restricted stock units and employee stock purchase rights, based on estimated fair values.

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Effect on net income

Substantially all of the share-based compensation expense was recorded in “Selling, general and administrative expenses” in the Consolidated Statements of Operations.

Substantially all of the share-based compensation expense was recorded in “Selling, general and administrative expenses” and “Acquisition, integration and restructuring costs” in the Consolidated Statements of Operations.

Valuation Assumptions

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The Company accounts for expense reductions that result from the forfeiture of unvested awards in the period that the forfeitures occur.

Employee Stock Options

A summary of the changes in the Company’s stock options is set forth below:

Options Outstanding

average exercise

price per share

Balances, November 30, 2020

Options granted

Options exercised

Balances, November 30, 2021

The Company did no t grant any options during the fiscal year 2020.

The following assumptions were used in the Black-Scholes valuation model in fiscal years 2021 and 2019:

Fiscal Years Ended November 30,

Stock option plan:

Expected life (years)

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0.72% - 1.16%

1.59% - 2.62%

Expected volatility

38.01% - 38.85%

32.33% - 33.69%

Dividend yield

0.75% - 0.88%

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The Company did no t grant any options during the fiscal year 2020.

A summary of the activities under the SYNNEX Plans is set forth below:

Options Outstanding

Shares available

average exercise

price per share

Balances, November 30, 2019

Restricted stock awards granted

Restricted stock units granted

Restricted stock cancelled/forfeited ( 1)

Options exercised

Balances, November 30, 2020

For performance-based restricted stock units, the difference between maximum awards and the actual number of shares issued upon full vesting is included.

Employee Stock Options

1.36% - 1.54%

The weighted-average grant-date fair values of the stock options granted during fiscal years 2021 and 2019 were $ 34.37 , and $ 32.76 , respectively.

As of November 30, 2021, 689 options were outstanding with a weighted-average life of 7.45 years, a weighted-average exercise price of $ 66.29 per option and an aggregate pre-tax intrinsic value of $ 26,149 .

As of November 30, 2020, 418 options were vested and exercisable with a weighted-average life of 3.42 years, a weighted-average exercise price of $ 53.41 per share and an aggregate pre-tax intrinsic value of $ 30,514 .

As of November 30, 2021, 316

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options were vested and exercisable with a weighted-average life of 6.07 years , a weighted-average exercise price of $ 50.35 per share and an aggregate pre-tax intrinsic value of $ 16,786 .

The cash received from the exercise of options and the intrinsic values of options exercised during fiscal years 2021, 2020 and 2019 were as follows:

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The Company settles employee stock option exercises with newly issued common shares.

As of November 30, 2020, the unamortized share-based compensation expense related to unvested stock options under the SYNNEX Plans was $ 7,521 which will be recognized over an estimated weighted-average amortization period of 2.91 years.

As of November 30, 2021, the unamortized share-based compensation expense related to unvested stock options under the TD SYNNEX Plans was $ 7,433 which will be recognized over an estimated weighted-average amortization period of 3.77 years.

Restricted Stock Awards and Restricted Stock Units

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Non-vested as of November 30, 2021

(1) For performance-based restricted stock units, the difference between maximum awards and the actual number of shares issued upon full vesting is included.

As of November 30, 2020, there was $ 54,514 of total unamortized share-based compensation expense related to non-vested restricted stock awards and stock units granted under the SYNNEX Plans.

(1) For performanc e-based restricted stock units, the difference between maximum awards and the actual number of shares issued upon full vesting is included.

As of November 30, 2021, there was $ 54,382 of total unamortized share-based compensation expense related to non-vested restricted stock awards and stock units granted under the TD SYNNEX Plans.

That cost is expected to be recognized over an estimated weighted-average amortization period of 2.79 years.

In connection with its annual employee stock awards for fiscal year 2020, the Company has reserved approximately $ 9,500 under the SYNNEX Plan to be granted subsequent to completion of the Separation.

Similarly, approximately $ 44,000 was reserved for grants to be made subsequent to completion of the Separation under the Concentrix Incentive Plan.

In connection with the Separation, as required by the SYNNEX Plans, the Company will make certain adjustments to outstanding employee equity awards with the intention of preserving the intrinsic value of the awards prior to the Separation.

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accordance with the employee matters agreement e ach exercisable and non-exercisable stock option and unvested restricted stock award will be converted into similar awards of both SYNNEX and Concentrix and the exercise price of outstanding stock options will be adjusted to preserve the intrinsic value of the awards.

Certain restricted stock unit s and performance-contingent awards will be adjusted to provide holders restricted stock units and performance contingent awards in the company that employs such employee following the Separation.

In connection with the Separation, as required by the TD SYNNEX stock incentive plans, the Company made certain adjustments to outstanding employee equity awards with the intention of preserving the intrinsic value of the awards prior to the Separation.

In accordance with the employee matters agreement, each exercisable and non-exercisable stock option and unvested restricted stock award was modified into similar awards of both SYNNEX and Concentrix and the exercise price of outstanding stock options was adjusted to preserve the intrinsic value of the awards.

Certain restricted stock units and performance-contingent awards were modified to provide the holders restricted stock units and performance contingent awards in the company that employs such employee following the Separation.

When settled wholly in the employer’s shares, the ratio was based on the closing stock price of SYNNEX at November 30, 2020 compared to the opening stock price of the respective entity on December 1, 2020.

The options strike prices were adjusted in the same manner.

The modification of these awards did not result in material incremental compensation cost.

Tech Data Equity Awards

Prior to the Merger, certain of Tech Data’s employees were granted performance-based equity awards in Tiger Parent Holdings L.P., a partnership entity that was the parent company of Tiger Parent (AP) Corporation and Tech Data, that were unvested at the time of the closing of the Merger.

Upon closing of the Merger, the unvested performance-based equity awards were converted into 751 restricted stock units of TD SYNNEX that vest over two years .

The restricted stock units had a fair value of $ 127.60 per share upon closing of the Merger resulting in a total fair value of $ 95,871 which will be recorded as share-based compensation expense on a straight-line over the vesting period in “Acquisition, integration, and restructuring costs” in the Consolidated Statement of Operations.

No awards were vested or forfeited during the fiscal year ended November 30, 2021.

As of November 30, 2021, there was $ 83,887 of total unamortized share-based compensation expense related to these unvested awards to be recognized over a weighted-average amortization period of 1.75 years.

2014 Employee Stock Purchase Plan

On January 6, 2014, the Board of Directors approved the adoption of the 2014 Employee Stock Purchase Plan (“2014 ESPP”) to succeed the Company's 2003 Employee Stock Purchase Plan.

The 2014 ESPP, as amended, commenced on January 1, 2015 with 750 authorized shares, which was due to antidilution provisions in the 2014 ESPP increased by 537 authorized shares following the Separation.

Under the 2014 ESPP, there are four offering periods of three months each in a calendar year.

Eligible employees in the United States can choose to have a fixed percentage deducted from their bi-weekly compensation to purchase the Company’s common stock at a discount of 5 %.

The maximum number of shares a participant may purchase is 0.625 during a single accumulation period subject to a maximum purchase limit of $ 10 in a calendar year.

Highly compensated employees are not eligible to participate in the plan.

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Share-based compensation expense related to the 2014 ESPP was immaterial during fiscal years 2021 , 2020 and 2019.

NOTE 7—STOCKHOLDERS’ EQUITY:

Share Repurchase Programs

As of November 30, 2021, the Company had no t repurchased any shares under this program.

The Company declared cumulative cash dividends of $ 0.80 , $ 0.40 and $ 1.50 per share during the years ended November 30, 2021, 2020 and 2019, respectively.

On January 11, 2022 , the Company announced a cash dividend of $ 0.30 per share to stockholders of record as of January 21, 2022 , payable on January 28, 2022 .

NOTE 8—BALANCE SHEET COMPONENTS:

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Receivables from vendors, net

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Allowance for doubtful trade receivables:

Balance at November 30, 2018

Write-offs and reclassifications

Write-offs, reclassifications and foreign exchange translation

Balance at November 30, 2019

Write-offs and reclassifications

Write-offs, reclassifications and foreign exchange translation

Balance at November 30, 2020

Write-offs and reclassifications

Additions (deductions)

Write-offs, reclassifications and foreign exchange translation

Balance at November 30, 2021

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Balance at November 30, 2018

Write-offs and reclassifications

Write-offs, reclassifications and foreign exchange translation

Balance at November 30, 2019

Write-offs and reclassifications

Write-offs, reclassifications and foreign exchange translation

Balance at November 30, 2020

Write-offs and reclassifications

Write-offs, reclassifications and foreign exchange translation

Balance at November 30, 2021

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Property and equipment, net:

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Total property and equipment, gross

Accumulated depreciation

Accumulated depreciation and amortization

Property and equipment, net

Depreciation expense for fiscal years 2020, 2019 and 2018, was $ 154,206 , $ 161,627 and $ 100,955 , respectively.

Fiscal Year Ended November 30, 2020

Depreciation and amortization expense for fiscal years 2021, 2020 and 2019, was $ 44,232 , $ 24,923 and $ 22,454 , respectively.

Fiscal Year Ended November 30, 2021

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Balance, end of year

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Intangible assets, net:

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As of November 30, 2020

Intangible assets with indefinite lives:

Intangible assets with finite lives:

Customer relationships and lists

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Fiscal years ending November 30,

Subsequent to November 30, 2020, $ 798,960 of intangibles assets, net related to the Concentrix segment are no longer the Company’s assets pursuant to the completion of the Separation.

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Accumulated other comprehensive income (loss)

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Balance, beginning of year

Transferred to Concentrix

Other comprehensive income (loss) before reclassification

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Balance, end of year

Refer to Note 6 for the location of gains and losses reclassified from other comprehensive income (loss) to the Consolidated Statements of Operations.

Refer to Note 9 – Derivative Instruments for the location of gains and losses reclassified from accumulated other comprehensive income (loss) to the Consolidated Statements of Operations.

Reclassifications of amortization of actuarial (gains) losses of defined benefits plans is recorded in "Other income (expense), net" in the combined statement of operations.

Foreign currency translation adjustment and other, net of taxes, is comprised of the foreign currency translation adjustment and unrealized gains and losses on available-for-sale debt securities.

Substantially, all of the balance at both November 30, 2019 and 2020 represents foreign currency translation adjustment.

Foreign currency translation adjustment and other, net of taxes, is comprised of foreign currency translation adjustments and unrealized gains and losses on Concentrix’ available -for-sale debt securities prior to the Separation .

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NOTE 9—DERIVATIVE INSTRUMENTS:

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Cash Flow Hedges

To protect gross margins from fluctuations in foreign currency exchange rates, certain of the Company’s subsidiaries with functional currencies that are not in U.S.

dollars may hedge a portion of forecasted revenue or costs not denominated in the subsidiaries’ functional currencies.

These instruments mature at various dates through November 2022 .

The Company also uses interest rate swap derivative contracts to economically convert a portion of its variable-rate debt to fixed-rate debt.

The Company uses interest rate swap derivative contracts to economically convert a portion of its variable-rate debt to fixed-rate debt.

The swaps have maturities at various dates through October 2023 .

The Company terminated interest rate swaps with a notional value of $ 400,000 in December 2021.

Gains and losses on cash flow hedges are recorded in AOCI until the hedged item is recognized in earnings.

Deferred gains and losses associated with cash flow hedges of foreign currency revenue are recognized as a component of Revenue from Services in the same period as the related revenue is recognized, and deferred gains and losses related to cash flow hedges of costs are recognized as a component of Cost of revenue for services and/or Selling, general and administrative expenses in the same period as the related costs are recognized.

Deferred gains and losses associated with cash flow hedges of interest payments are recognized in Interest expense and finance charges, net in the same period as the related expense is recognized.

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Derivatives that are not designated as hedging instruments are adjusted to fair value through earnings in the financial statement line item to which the derivative relates.

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Fair Values of Derivative Instruments in the Consolidated Balance Sheets

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Derivative instruments designated as cash flow hedges:

Foreign exchange forward contracts (notional value)

Other current assets and other assets, net

Other accrued liabilities and other long-term liabilities

Interest rate swaps (notional value)

Other accrued liabilities

Other long-term liabilities

Volume of activity

The notional amounts of foreign exchange forward contracts represent the gross amounts of foreign currency, including, principally, the Philippine Peso, Indian Rupee, the Euro, the Canadian Dollar, the Japanese Yen, the British Pound, the Brazilian Real and the Chinese Yuan that will be bought or sold at maturity.

The term and notional amount of interest rate swaps are determined based on management’s assessment of future interest rates and other factors such as debt maturities.

The notional amounts of foreign exchange forward contracts represent the gross amounts of foreign currency, including, principally, the Australian dollar, Brazilian real, British pound, Canadian dollar, Chinese yuan, Czech koruna, Danish krone, Euro, Indian rupee, Indonesian rupiah, Japanese yen, Mexican peso, Norwegian krone, Philippine peso, Polish zloty, Singapore dollar, Swedish krona and Swiss franc that will be bought or sold at maturity.

The notional amounts for outstanding derivative instruments provide one measure of the transaction volume outstanding and do not represent the amount of the Company’s exposure to credit or market loss.

The Company’s exposure to credit loss and market risk will vary over time as currency and interest rates change.

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The Effect of Derivative Instruments on AOCI and the Consolidated Statements of Operations

The following table shows the gains and losses, before taxes, of the Company's derivative instruments designated as cash flow hedges and not designated as hedging instruments in Other Comprehensive Income (“OCI”), and the Consolidated Statements of Operations for the periods presented:

The following table shows the gains and losses, before taxes, of the Company's derivative instruments designated as cash flow hedges in Other Comprehensive Income (“OCI”), and not designated as hedging instruments in the Consolidated Statements of Operations for the periods presented:

Location of Gains (losses)

For the fiscal years ended November 30,

Revenue for services

Cost of revenue for services

Selling, general and administrative expenses

Interest expense and finance charges, net

Other income (expense), net

Derivative instruments designated as cash flow hedges:

Gains (losses) recognized in OCI:

Foreign exchange forward contracts

Interest rate swaps

Gains (losses) reclassified from AOCI into income:

Foreign exchange forward contracts

Gains (losses) reclassified from AOCI into income

Revenue for services

Gains (losses) reclassified from AOCI into income

Cost of revenue for

Gains (losses) reclassified from AOCI into income

Selling, general and

administrative expenses

Gains (losses) reclassified from AOCI into income

(expense), net

Interest rate swaps

Gains (losses) reclassified from AOCI into

Gains (losses) recognized in OCI on interest rate swaps

Gains (losses) on interest rate swaps reclassified from AOCI into income

Interest expense and

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Derivative instruments not designated as hedging instruments:

Gains (losses) recognized from Foreign exchange

forward contracts, net ( 1)

Cost of revenue for services and Selling, general and administrative expenses

Gains (losses) recognized from foreign exchange forward contracts, net (1)

Cost of products sold

Gains (losses) recognized from foreign exchange forward contracts, net (1)

(expense), net

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Existing net losses in AOCI that are expected to be reclassified into earnings in the normal course of business within the next twelve months are $ 38,670 .

Included in this amount are net gains of $ 32,142 of foreign exchange forward contracts related to the Concentrix segment, which following the completion of the Separation will no longer be reclassified into the Company’s earnings.

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Offsetting of Derivatives

The Company’s derivative instruments are generally governed by standard International Swaps and Derivatives Association, Inc.

master agreements, which generally do not require the Company to post any collateral, and specify netting rights, and other customary provisions including events of defaults and termination rights.

In the Consolidated Balance Sheets, the Company does not offset derivative assets against liabilities in master netting arrangements.

If derivative exposures covered by a qualifying master netting agreement had been netted in the Consolidated Balance Sheet, the total derivative asset and liability positions would have been reduced by $ 6,659 each as of November 30, 2020 and $ 6,003 each as of November 30, 2019.

Credit exposure for derivative financial instruments is limited to the amounts, if any, by which the counterparties’ obligations under the contracts exceed the Company’s obligations to the counterparties.

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Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity).

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The following table summarizes the valuation of the Company’s investments and financial instruments that are measured at fair value on a recurring basis:

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Marketable equity securities

Foreign government bond

Forward foreign currency exchange contracts

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The carrying values of cash equivalents approximate fair value since they are near their maturity.

Investments in marketable equity securities, primarily comprising investments in other companies’ equity securities as per local customary business practice, are recorded at fair value based on quoted market prices.

Investment in foreign government bond classified as available-for-sale debt security is recorded at fair value based on quoted market prices.

Investments in marketable equity securities, primarily comprising investments in other companies’ equity securities, are recorded at fair value based on quoted market prices.

The fair values of forward exchange contracts are measured based on the foreign currency spot and forward rates quoted by the banks or foreign currency dealers.

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The carrying value of the Company’s term loans approximate their fair value since they bear interest rates that are similar to existing market rates.

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During fiscal years 2020, 2019 and 2018, there were no transfers between the fair value measurement category levels.

NOTE 8—ACCOUNTS RECEIVABLE ARRANGEMENTS:

The Company has an uncommitted supply-chain financing program with a global financial institution under which trade accounts receivable of certain customers and their affiliates may be acquired, without recourse, by the financial institution.

Available capacity under this program is dependent on the level of the Company’s trade accounts receivable with these customers and the financial institution’s willingness to purchase such receivables.

As of November 30, 2020 and 2019, accounts receivable sold to and held by the financial institution under this program were $ 16,735 and $ 32,472 , respectively.

Discount fees related to the sale of trade accounts receivable under this facility are included in “Interest expense and finance charges, net” in the Consolidated Statements of Operations.

During the fiscal years ended November 30, 2020, 2019 and 2018, discount fees were $ 3,186 , $ 2,281 and $ 1,621 , respectively.

SYNNEX Japan, the Company's Japanese Technology Solutions subsidiary, has arrangements with financial institutions for the sale and financing of approved accounts receivable and notes receivable.

The amounts outstanding under these arrangements that were sold, but not collected, as of November 30, 2020 and 2019 were $ 5,798 and $ 2,856 , respectively.

The Company also has other financing agreements in North America with financial institutions (“Flooring Companies”) to allow certain customers of the Company to finance their purchases directly with the Flooring Companies.

Under these agreements, the Flooring Companies pay to the Company the selling price of products sold to various customers, less a discount, within approximately 15 to 30 days from the date of sale.

The Company is contingently liable to repurchase inventory sold under flooring agreements in the event of any default by its customers under the agreement and such inventory being repossessed by the Flooring Companies.

See Note 16 — Commitments and Contingencies for further information.

The following table summarizes the net sales financed through flooring agreements and the flooring fees incurred:

Fiscal Years Ended November 30,

Net sales financed

Flooring fees ( 1)

Flooring fees are included within “Interest expense and finance charges, net.”

As of November 30, 2020 and 2019, accounts receivable subject to flooring agreements were $ 49,461 and $ 69,637 , respectively.

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The estimated fair value of the Senior Notes was approximately $ 2,449,277 at November 30, 2021.

During the fiscal years ended November 30, 2021, 2020 and 2019, there were no transfers between the fair value measurement category levels.

NOTE 11—BORROWINGS:

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As of November 30,

SYNNEX United States accounts receivable securitization arrangement

SYNNEX Japan credit facility - revolving line of credit component

SYNNEX United States credit agreement - revolving line of credit component

SYNNEX United States credit agreement - current portion

of term loan component

SYNNEX United States term loan credit agreement - current portion

SYNNEX Japan credit facility - current portion of term loan component

Concentrix credit agreement - current portion of term loan component

Other borrowings

Committed and uncommitted revolving credit facilities and borrowings

Current portion of TD SYNNEX credit agreement

Current portion of other long-term debt

Borrowings, current

SYNNEX Japan credit facility - term loan component

TD SYNNEX credit agreement

TD SYNNEX Senior Notes

SYNNEX United States credit agreement - term loan component

SYNNEX United States term loan credit agreement

Concentrix credit agreement - term loan component

Concentrix accounts receivable securitization arrangement

Other term debt

Long-term borrowings, before unamortized debt discount

and issuance costs

Other credit agreements and long-term debt

Long-term borrowings, before unamortized debt discount and issuance costs

unamortized debt discount and issuance costs

Long-term borrowings

SYNNEX United States accounts receivable securitization arrangement

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TD SYNNEX United States accounts receivable securitization arrangement

In the United States, the Company has an accounts receivable securitization program to provide additional capital for its operations (the “U.S.

AR Arrangement”).

Prior to the amendment in May 2020 that is described in this paragraph, u nder the terms of the U.S.

AR Arrangement, the Company’s subsidiary that is the borrower under this facility could borrow up to a maximum of $ 850,000 based upon eligible trade accounts receivable.

The effective borrowing cost under the U.S.

AR Arrangement is a blended rate based upon the composition of the lenders, that includes prevailing dealer commercial paper rates and a rate based upon LIBOR.

In addition, prior to the May 2020 amendment, a program fee of 0.75 % per annum based on the used portion of the commitment, and a facility fee of 0.35% per annum, was payable on the adjusted commitment of the lenders.

In May 2020 , the U.S.

AR Arrangement was amended to revise the maximum borrowing amount to $ 650,000 and to extend the maturity date of the U.S.

AR Arrangement to May 2022 .

The program fee payable on the used portion of the lenders’ commitment, was modified to accrue at 1.25 % per annum in the case of lender groups who fund their advances based on prevailing commercial paper rates, and 1.30 % per annum in the case of lender groups who fund their advances based on LIBOR (subject to a 0.50 % per annum floor).

The amendment also modified the facility fee payable on the adjusted commitment of the lenders, to accrue at different tiers ranging between 0.35 % per annum and 0.45 % per annum depending on the amount of outstanding advances from time to time.

In addition, the U.S.

AR Arrangement includes an accordion feature to allow requests for an increase in the lenders' commitment by an additional $ 150,000 .

U nder the terms of the U.S.

AR Arrangement, that, prior to the December 2021 amendment described below, was scheduled to expire in May 2022 , the Company’s subsidiary that is the borrower under this facility could borrow up to a maximum of $ 650,000 based upon eligible trade accounts receivable.

During the fiscal year ended November 30, 2021, the effective borrowing cost under the U.S.

AR Arrangement was a blended rate based upon the composition of the lenders, that includes prevailing dealer commercial paper rates and a rate based upon LIBOR.

In addition, a program fee payable on the used portion of the lenders’ commitment, accrued at 1.25 % per annum in the case of lender groups who funded their advances based on prevailing commercial paper rates, and 1.30 % per annum in the case of lender groups who funded their advances based on LIBOR (subject to a 0.50 % per annum floor).

A facility fee was payable on the adjusted commitment of the lenders, to accrue at different tiers ranging between 0.35 % per annum and 0.45 % per annum depending on the amount of outstanding advances from time to time.

Under the terms of the U.S.

Arrangement, the Company and two of its U.S.

AR Arrangement, the Company and certain of its U.S.

subsidiaries sell, on a revolving basis, their receivables to a wholly-owned, bankruptcy-remote subsidiary.

2 unchanged sentences

AR Arrangement are recorded as debt on the Company's Consolidated Balance Sheets.

SYNNEX Canada accounts receivable securitization arrangement

SYNNEX Canada Limited (“SYNNEX Canada”), the Company's Technology Solutions subsidiary in Canada, has an accounts receivable securitization program with a bank to provide additional capital for its operations.

In March 2020, SYNNEX Canada renewed this agreement to mature in May 2023 .

Under the terms of this program, SYNNEX Canada can borrow up to CAD 100,000 , or $ 76,864 , in exchange for the transfer of eligible trade accounts receivable, on an ongoing revolving basis.

The program includes an accordion feature that allows SYNNEX Canada to request an increase in the bank’s commitment up to an additional CAD 50,000 , or $ 38,432 .

Any amounts received under this arrangement are recorded as debt on the Company's Consolidated Balance Sheets and are secured by pledging all of the rights, title and interest in the receivables to the bank.

The effective borrowing cost is based on the weighted-average of the Canadian Dollar Offered Rate plus a margin of 1.00 % per annum and the prevailing lender commercial paper rates.

In addition, prior to an event of termination, SYNNEX Canada is obligated to pay a program fee of 0.75 % per annum based on

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the used portion of the commitment.

After an event of termination, the program fee shall be the sum of the base rate and 2.50 % per annum, based on the used portion of the commitment.

SYNNEX Canada pays a fee of 0.40 % per annum for any unused portion of the commitment up to CAD 60,000 , or $ 46,118 , and when the unused portion exceeds CAD 60,000 , or $ 46,118 , a fee of 0.55 % per annum of the unused portion of the commitment .

As of both November 30, 2020 and 2019 , there was no outstanding balance under this arrangement.

The Company has guaranteed the performance obligations of SYNNEX Canada under this facility.

SYNNEX Japan credit facility

SYNNEX Japan has a credit agreement with a group of banks for a maximum commitment of JPY 15,000,000 or $ 143,761 .

The credit agreement is comprised of a JPY 7,000,000 , or $ 67,088 , term loan and a JPY 8,000,000 , or $ 76,672 , revolving credit facility and expires in November 2021 .

The interest rate for the term loan and revolving credit facility is based on the Tokyo Interbank Offered Rate, plus a margin, which is based on the Company’s consolidated leverage ratio, and currently equals 0.70 % per annum.

The unused line fee on the revolving credit facility is currently 0.10 % per annum based on the Company's consolidated current leverage ratio.

The term loan can be repaid at any time prior to the expiration date without penalty.

The Company has guaranteed the obligations of SYNNEX Japan under this facility.

Concentrix India revolving lines of credit facilities

Concentrix' Indian subsidiaries have credit facilities with a financial institution to borrow up to an aggregate amount of $ 22,000 .

The interest rate under these facilities is the higher of the bank's minimum lending rate or LIBOR, plus a margin of 0.9 % per annum.

The Company guarantees the obligations under these credit facilities.

These credit facilities can be terminated at any time by the Company’s Indian subsidiaries or the financial institution.

There were no borrowings outstanding under these credit facilities as of either November 30, 2020 or 2019.

Subsequent to November 30, 2020, with the completion of the Separation, these facilities are no longer part of the Company’s lines of credit.

On December 22, 2021, the Company and its subsidiaries that are party to the U.S.

AR Arrangement amended the U.S.

AR Arrangement to extend the maturity date to December 2024 and increase the lending commitment to $ 1,500,000 .

Further, the effective borrowing cost under the U.S.

AR Arrangement was also modified through adjustments to the (i) program fee payable on the used portion of the lenders’ commitment, that now accrues at 0.75 % per annum and (ii) facility fee payable on the adjusted commitment of the lenders, that now accrues at different tiers ranging between 0.30 % per annum and 0.40 % per annum depending on the amount of outstanding advances from time to time.

SYNNEX United States credit agreement

In the United States, the Company has a senior secured credit agreement (as amended, the "U.S.

Prior to the Merger, in the United States, the Company had a senior secured credit agreement (as amended, the "U.S.

Credit Agreement") with a group of financial institutions.

Credit Agreement includes a $ 600,000 commitment for a revolving credit facility and a term loan in the original principal amount of $ 1,200,000 .

The Company may request incremental commitments to increase the principal amount of the revolving line of credit or term loan by $ 500,000 , plus an additional amount which is dependent upon the Company's pro forma first lien leverage ratio, as calculated under the U.S.

Credit Agreement.

Credit Agreement matures in September 2022 .

The outstanding principal amount of the term loan was repayable in quarterly installments of $ 15,000 , with the unpaid balance due in full on the September 2022 maturity date.

The term loan can be repaid at any time prior to the maturity date without penalty.

At November 30, 2020, in connection with the Separation, the Company partially repaid the term loan using a portion of the funds drawn under the Concentrix United States Credit Agreement and the Concentrix accounts receivable securitization arrangement.

The remaining outstanding principal of the term loan is payable on maturity.

Credit Agreement included a $ 600,000 commitment for a revolving credit facility and a term loan in the original principal amount of $ 1,200,000 .

Interest on borrowings under the U.S.

Credit Agreement can be based on LIBOR or a base rate at the Company's option, plus a margin.

The margin for LIBOR loans ranges from 1.25 % to 2.00 % and the margin for base rate loans ranges from 0.25 % to 1.00 %, provided that LIBOR shall not be less than zero .

The base rate is a variable rate which is the highest of (a) the Federal Funds Rate, plus a margin of 0.5 %, (b) the rate of interest announced, from time to time, by the agent, Bank of America, N.A., as its “prime rate,” and (c) the Eurodollar Rate, plus 1.0 %.

The unused revolving credit facility commitment fee ranges from 0.175 % to 0.30 % per annum.

The margins above the applicable interest rates and the revolving commitment fee for revolving loans are based on the Company’s consolidated leverage ratio, as calculated under the U.S.

Credit Agreement was based on LIBOR or a base rate at the Company's option, plus a margin.

The margin for LIBOR loans ranged from 1.25 % to 2.00 % and the margin for base rate loans ranged from 0.25 % to 1.00 %, provided that LIBOR was not less than zero .

The base rate was a variable rate which was the highest of (a) the Federal Funds Rate, plus a margin of 0.5 %, (b) the rate of interest announced, from time to time, by the agent, Bank of America, N.A., as its “prime rate,” and (c) the Eurodollar Rate, plus 1.0 %.

The unused revolving credit facility commitment fee ranged from 0.175 % to 0.30 % per annum.

The margins above the applicable interest rates and the revolving commitment fee for revolving loans were based on the Company’s consolidated leverage ratio, as calculated under the U.S.

Credit Agreement.

The Company’s obligations under the U.S.

Credit Agreement are secured by substantially all of the parent company’s and its United States domestic subsidiaries’ assets on a pari passu basis with the interests of the lenders under the U.S.

Term Loan Credit Agreement (defined below) pursuant to an intercreditor agreement and are guaranteed by certain of the Company's United States domestic subsidiaries.

Credit Agreement were secured by substantially all of the parent company’s and its United States domestic subsidiaries’ assets on a pari passu basis with the interests of the lenders under the U.S.

Term Loan Credit Agreement (defined below) pursuant to an intercreditor agreement and were guaranteed by certain of the Company's United States domestic subsidiaries.

Credit Agreement was originally scheduled to mature in September 2022 , however the U.S.

Credit Agreement was terminated on September 1, 2021 and all outstanding balances were repaid in full as part of the Merger (see Note 3 – Acquisitions for further discussion).

SYNNEX United States term loan credit agreement

The Company has a secured term loan credit agreement (the “U.S.

Prior to the Merger, in the United States the Company had a senior secured term loan credit agreement (the “U.S.

Term Loan Credit Agreement”) with a group of financial institutions in the original principal amount of $ 1,800,000 .

Term Loan Credit Agreement matures in October 2023 .

The outstanding principal amount of the term loans was payable in quarterly installments of $ 22,500 , with the unpaid balance due in full on the maturity date.

The term loan can be repaid at any time prior to the expiration date without penalty.

At November 30, 2020, in connection with Separation, the Company partially repaid the term loan using a portion of the funds drawn under the Concentrix United States Credit Agreement and the Concentrix accounts receivable securitization arrangement.

The remaining outstanding principal is payable on maturity.

The remaining outstanding principal was payable on maturity.

Interest on borrowings under the U.S.

Term Loan Credit Agreement can be based on LIBOR or a base rate at the Company’s option, plus a margin.

The margin for LIBOR loans ranges from 1.25 % to 1.75 % and the margin for base rate loans ranges from 0.25 % to 0.75 %, provided that LIBOR shall not be less than zero .

The base rate is a variable rate which is the highest of (a) 0.5 % plus the greater of (x) the Federal Funds Rate in effect on such day and (y) the overnight bank funding rate in effect on such day, (b) the Eurodollar Rate plus 1.0 % per annum, and (c) the rate of interest last quoted by The Wall Street Journal as the “Prime Rate” in the U.S.

Term Loan Credit Agreement were based on LIBOR or a base rate at the Company’s option, plus a margin.

The margin for LIBOR loans ranged from 1.25 % to 1.75 % and the margin for base rate loans ranged from 0.25 % to 0.75 %, provided that LIBOR was not less than zero .

The base rate was a variable rate which was the highest of (a) 0.5 % plus the greater of (x) the Federal Funds Rate in effect on such day and (y) the overnight bank funding rate in effect on such day, (b) the Eurodollar Rate plus 1.0 % per annum, and (c) the rate of interest last quoted by The Wall Street Journal as the “Prime Rate” in the U.S.

During the period in which the term loans were available to be drawn, the Company paid term loan commitment fees.

The margins above the Company's applicable interest rates are, and the term loan commitment fee were, based on

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the Company's consolidated leverage ratio as calculated under the U.S.

The margins above the Company's applicable interest rates and the term loan commitment fee were based on the Company's consolidated leverage ratio as calculated under the U.S.

Term Loan Credit Agreement.

The Company's obligations under the U.S.

Term Loan Credit Agreement are secured by substantially all of the Company’s and certain of its domestic subsidiaries’ assets on a pari passu basis with the interests of the lenders under the existing U.S.

Credit Agreement pursuant to an intercreditor agreement, and are guaranteed by certain of its domestic subsidiaries.

Concentrix United States credit agreement

In October 2020, in preparation for the Separation, Concentrix, which was a subsidiary of the Company at the time, entered into a secured credit agreement (the "Concentrix Credit Agreement") with a group of financial institutions.

The Concentrix Credit Agreement includes a $ 600,000 revolving credit facility and a $ 900,000 term loan.

On November 30, 2020, the full amount of the term loan was drawn.

Concentrix may request incremental commitments to increase the principal amount of the revolving line of credit or term loan by $ 450,000 , plus an additional amount which is dependent upon the Concentrix' post Separation pro forma first lien leverage ratio, as calculated under the Concentrix Credit Agreement.

The outstanding principal amount of the term loan is repayable in quarterly installments of $ 11,250 commencing on May 31, 2021 , with the unpaid balance due in full on the November 2025 maturity date.

The term loan can be repaid at any time prior to the maturity date without penalty.

Interest on borrowings under the Concentrix Credit Agreement can be based on LIBOR or a base rate at the Company's option, plus a margin.

The margin for LIBOR loans ranges from 1.25 % to 2.25 % and the margin for base rate loans ranges from 0.25 % to 1.25 %, provided that LIBOR shall not be less than 0.25 %.

The unused revolving credit facility commitment fee ranges from 0.175 % to 0.30 % per annum.

The margins above the applicable interest rates and the revolving commitment fee for revolving loans are based on Concentrix’ post Separation consolidated leverage ratio, as calculated under the Concentrix Credit Agreement.

The obligations under the Concentrix Credit Agreement are secured by substantially all of Concentrix and its United States domestic subsidiaries’ assets and are guaranteed by certain of Concentrix’ United States domestic subsidiaries.

The funds borrowed under this facility were utilized to partially repay the Company’s outstanding term loans in the United States described earlier in this note.

Subsequent to November 30, 2020, with the completion of the Separation, the Concentrix Credit Agreement is no longer recorded as borrowings on the Company’s consolidated balance sheet .

At November 30, 2020, no amount was outstanding under the revolving line of credit.

Concentrix accounts receivable securitization arrangement

In October 2020, in anticipation of the Separation, Concentrix and certain of its subsidiaries, entered into a $ 350,000 accounts receivable securitization program (the “Concentrix AR Arrangement) with a maturity date of October 2022 .

Under the terms of the Concentrix AR Arrangement, Concentrix and certain of its U.S.

subsidiaries sell, on a revolving basis, their receivables to a wholly-owned, bankruptcy-remote subsidiary of Concentrix, which is the borrower under this facility.

The amount received under the Concentrix AR Arrangement is recorded as debt on the Company's Consolidated Balance Sheet.

Borrowings under this facility will bear interest with respect to loans that lenders fund through the issuance of commercial paper at the applicable commercial paper rate plus a spread of 1.05 % per annum and, otherwise, at a per annum rate equal to the applicable LIBOR rate plus a spread of 1.15 %.

In addition, the borrower is obligated to pay a monthly undrawn fee from the initial funding date that will range from 0.30 % per annum to 0.38 % per annum depending on the amount of outstanding advances from time to time.

The borrowings are funded by pledging all of the rights, title and interest in the receivables acquired by Concentrix’ bankruptcy-remote subsidiary as security.

The funds borrowed under this facility were utilized to partially repay the Company’s outstanding term loans in the United States described later in this note.

Subsequent to November 30, 2020, with the completion of the Separation, the Concentrix AR Arrangement is no longer recorded as borrowings on the Company’s consolidated balance sheet.

SYNNEX Canada revolving line of credit

SYNNEX Canada has an uncommitted revolving line of credit with a bank under which it can borrow up to CAD 50,000 , or $ 38,432 .

Borrowings under the facility are secured by eligible inventory and bear interest at a base rate plus a margin ranging from 0.50 % to 2.25 % depending on the base rate used.

The base rate could be a Banker's Acceptance Rate, a Canadian Prime Rate, LIBOR or U.S.

As of both November 30, 2020 and 2019, there were no borrowings outstanding under this credit facility.

Term Loan Credit Agreement were secured by substantially all of the Company’s and certain of its domestic subsidiaries’ assets on a pari passu basis with the interests of the lenders under the U.S.

Credit Agreement pursuant to an intercreditor agreement, and were guaranteed by certain of its domestic subsidiaries.

Term Loan Credit Agreement was originally scheduled to mature in October 2023 , however the U.S.

Term Loan Credit Agreement was terminated on September 1, 2021 and all outstanding balances were repaid in full as part of the Merger (see Note 3 – Acquisitions for further discussion).

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TD SYNNEX credit agreement

In connection with the Merger Agreement, the Company entered into a credit agreement, dated as of April 16, 2021 (the “TD SYNNEX Credit Agreement”) with the lenders party thereto and Citibank, N.A., as agent, pursuant to which the Company received commitments for the extension of a senior unsecured revolving credit facility not to exceed an aggregate principal amount of $ 3,500,000 , which revolving credit facility (the “TD SYNNEX revolving credit facility”) may, at the request of the Company but subject to the lenders’ discretion, potentially be increased by up to an aggregate amount of $ 500,000 .

The TD SYNNEX Credit Agreement also includes a senior unsecured term loan (the “TD SYNNEX term loan” and, together with the TD SYNNEX revolving credit facility, the “TD SYNNEX credit facilities”) in an aggregate principal amount of $ 1,500,000 , that was fully funded in connection with the closing of the Merger.

The borrower under the TD SYNNEX credit facilities is the Company.

There are no guarantors of the TD SYNNEX credit facilities.

The maturity of the TD SYNNEX credit facilities is on the fifth anniversary of the September 2021 closing date, to occur in September 2026, subject in the case of the revolving credit facility, to two one-year extensions upon the Company’s prior notice to the lenders and the agreement of the lenders to extend such maturity date.

The outstanding principal amount of the TD SYNNEX term loan is payable in quarterly installments in an amount equal to 1.25% of the original $1,500,000 principal balance commencing on the last day of the first full fiscal quarter after the closing date of the TD SYNNEX credit facilities, with the outstanding principal amount of the term loans due in full on the maturity date.

Loans borrowed under the TD SYNNEX Credit Agreement bear interest, in the case of LIBOR (or successor) rate loans, at a per annum rate equal to the applicable LIBOR (or successor) rate, plus the applicable margin, which may range from 1.125 % to 1.75 %, based on the Company’s public debt rating (as defined in the TD SYNNEX Credit Agreement).

The applicable margin on base rate loans is 1.00 % less than the corresponding margin on LIBOR (or successor rate) based loans.

In addition to these borrowing rates, there is a commitment fee that ranges from 0.125 % to 0.300 % on any unused commitment under the TD SYNNEX revolving credit facility based on the Company’s public debt rating.

As of November 30, 2021, the effective interest rate for the term loan was 1.49 %.

The TD SYNNEX Credit Agreement contains various loan covenants that are customary for similar facilities for similarly rated borrowers that restricts the ability of the Company and its subsidiaries to take certain actions.

The TD SYNNEX Credit Agreement also contains financial covenants that require compliance with a maximum debt to EBITDA ratio and a minimum interest coverage ratio, in each case tested on the last day of each fiscal quarter commencing with the first full fiscal quarter to occur after the closing date of the TD SYNNEX credit facilities.

The TD SYNNEX Credit Agreement also contains various customary events of default, including with respect to a change of control of the Company.

On March 22, 2021, the Company had entered into a debt commitment letter (the “Commitment Letter”), under which Citigroup Global Markets Inc.

and certain other financing institutions joining thereto pursuant to the terms thereof committed to provide (i) a $ 1.5 billion senior unsecured term bridge facility (the "Term Loan A Bridge Facility"), (ii) a $ 2.5 billion senior unsecured term bridge facility (the “Bridge Facility”) and (iii) a $ 3.5 billion senior unsecured revolving bridge facility (the "Bridge Revolving Facility"), subject to the satisfaction of certain customary closing conditions.

On April 16, 2021, (i) the $ 1.5 billion commitment with respect to the Term Loan A Bridge Facility under the Commitment Letter and (ii) the $ 3.5 billion commitment with respect to the Bridge Revolving Facility under the Commitment Letter were reduced to zero , in each case, as a result of the Company entering into the TD SYNNEX Credit Agreement;

and on August 9, 2021 the Bridge Facility was reduced to zero as a result of the issuance of the TD SYNNEX Senior Notes described below.

TD SYNNEX Senior Notes

On August 9, 2021, the Company completed its offering of $ 2.5 billion aggregate principal amount of senior unsecured notes, consisting of $ 700.0 million of 1.25 % senior notes due August 9, 2024 , $ 700.0 million of 1.75 % senior notes due August 9, 2026 , $ 600.0 million of 2.375 % senior notes due August 9, 2028 , and $ 500.0 million of 2.65 % senior notes due August 9, 2031 (collectively, the “Senior Notes,” and such offering, the “Senior Notes Offering”).

The Company incurred $ 19.6 million towards issuance costs on the Senior Notes.

The Company will pay interest semi-annually on the notes on each of February 9 and August 9, beginning February 9, 2022.

The net proceeds from this offering were used to fund a portion of the aggregate cash consideration payable in connection with the Merger, refinance certain of the Company’s existing indebtedness and pay related fees and expenses and for general corporate purposes.

The interest rate payable on each series of the Senior Notes will be subject to adjustment from time to time if the credit rating assigned to such series of Senior Notes is downgraded (or downgraded and subsequently upgraded).

The Company may redeem the Senior Notes, at any time in whole or from time to time in part, prior to (i) August 9, 2022 (the “2024 Par Call Date”) in the case of the 2024 Senior Notes, (ii) July 9, 2026 (the “2026 Par Call Date”) in the case of the 2026 Senior Notes, (iii) June 9, 2028 (the “2028 Par Call Date”) in the case of the 2028 Senior Notes, and (iv) May 9, 2031 in the case of the 2031 Senior Notes (the “2031 Par Call Date” and, together with the 2024 Par Call Date, the 2026 Par Call Date and the 2028 Par Call Date, each, a “Par Call Date” and together, the “Par Call Dates”), at a redemption price equal to the greater of (x) 100 % of the aggregate principal amount of the applicable Senior Notes to be redeemed and (y) the sum of the present values of the remaining scheduled payments of the principal and interest on the Senior Notes, discounted to the date of redemption on a semi-annual basis at a rate equal to the sum of the applicable treasury rate plus 15 basis points for the 2024 Senior Notes, 20 basis points for the 2026 Senior Notes and 25 basis points for the 2028 Senior Notes and 2031 Senior Notes, plus in each case, accrued and unpaid interest thereon to, but excluding, the redemption date.

The Company may also redeem the Senior Notes of any series at its option, at any time in whole or from time to time in part, on or after the applicable Par Call Date, at a redemption price equal to 100 % of the principal amount of the Senior Notes to be redeemed.

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Other borrowings and term debt

Other borrowings and term debt include lines of credit with financial institutions at certain locations outside the United States, factoring of accounts receivable with recourse provisions, capital leases, a building mortgage and book overdrafts.

As of November 30, 2020, commitments for these revolving credit facilities aggregated $ 47,920 .

The Company has various other committed and uncommitted lines of credit with financial institutions at certain locations outside the United States, accounts receivable securitization arrangements, factoring of accounts receivable with recourse provisions, capital leases, a building mortgage, short-term loans, term loans, credit facilities, and book overdraft facilities, totaling approximately $ 635,473 in borrowing capacity as of November 30, 2021.

Most of these facilities are provided on an unsecured, short-term basis and are reviewed periodically for renewal.

Interest rates and other terms of borrowing under these lines of credit vary by country, depending on local market conditions.

There was $ 106,256 outstanding on these facilities at November 30, 2021, at a weighted average interest rate of 4.59 %, and there was $ 57.9 million outstanding at November 30, 2020, at a weighted average interest rate of 1.03 %.

Borrowings under these lines of credit facilities are guaranteed by the Company or secured by eligible accounts receivable.

At November 30, 2021, the Company was also contingently liable for reimbursement obligations with respect to issued standby letters of credit in the aggregate outstanding amount of $ 104.7 million.

These letters of credit typically act as a guarantee of payment to certain third parties in accordance with specified terms and conditions.

The maximum commitment amounts for local currency credit facilities have been translated into United States Dollars at November 30, 2021 exchange rates.

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Future principal payments

1 unchanged sentence

Fiscal Years Ending November 30,

Subsequent to November 30, 2020, upon completion of the Separation, outstanding borrowings aggregating $ 1,145,118 , net of unamortized debt discount and issuance costs, which were part of the arrangements entered into by Concentrix and its subsidiaries, are no longer recorded as borrowings on the Company’s consolidated balance sheet.

Interest expense and finance charges

The total interest expense and finance charges for the Company’s borrowings were $ 132,954 , $ 172,777 and $ 92,899 for fiscal years 2020, 2019 and 2018, respectively.

The variable interest rates ranged between 0.74 % and 8.41 %, between 0.70 % and 11.38 % and between 0.58 % and 12.74 % in fiscal years 2020, 2019 and 2018, respectively.

Covenant compliance

The Company's credit facilities have a number of covenants and restrictions that, among other things, require the Company to maintain specified financial ratios and satisfy certain financial condition tests.

The covenants also limit the Company’s ability to incur additional debt, make or forgive intercompany loans, pay dividends and make other types of distributions, make certain acquisitions, repurchase the Company’s stock, create liens, cancel debt owed to the Company, enter into agreements with affiliates, modify the nature of the Company’s business, enter into sale-leaseback transactions, make certain investments, transfer and sell assets, cancel or terminate any material contracts and merge or consolidate.

As of November 30, 2020, the Company was in compliance with all material covenants for the above arrangements.

The Company's credit facilities have a number of covenants and restrictions that require the Company to maintain specified financial ratios.

The covenants also limit the Company’s ability to incur additional debt, create liens, enter into agreements with affiliates, modify the nature of the Company’s business, and merge or consolidate.

As of November 30, 2021, the Company was in compliance with all current and material financial covenant requirements for the above arrangements.

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NOTE 12—EARNINGS PER COMMON SHARE:

2 unchanged sentences

Basic earnings per common share:

net income allocated to participating securities ( 1)

Income from continuing operations attributable to common stockholders (1)

Income from discontinued operations attributable to common stockholders (1)

Net income attributable to common stockholders (1)

1 unchanged sentence

Basic earnings per common share

Continuing operations

Discontinued operations

Total basic net earnings per share

Diluted earnings per common share:

net income allocated to participating securities ( 1)

Income from continuing operations attributable to common stockholders (1)

Income from discontinued operations attributable to common stockholders (1)

Net income attributable to common stockholders (1)

4 unchanged sentences

Diluted earnings per common share

Continuing operations

Discontinued operations

Total basic net earnings per share

Anti-dilutive shares excluded from diluted earnings per share calculation

Restricted stock awards granted by the Company are considered participating securities.

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Income available to participating securities was immaterial in all periods presented.

NOTE 13—SEGMENT INFORMATION:

Segment results for all prior periods have been restated for comparability to the Company’s current reportable segments (see Note 1 – Organization and Basis of Presentation for further discussion) .

Summarized financial information related to the Company’s reportable business segments for the periods presented is shown below:

Inter-Segment

Fiscal Year ended November 30, 2021

External revenue

Operating income

1 unchanged sentence

Fiscal Year ended November 30, 2020

External revenue

Operating income

1 unchanged sentence

Fiscal Year ended November 30, 2019

External revenue

Operating income

Depreciation and amortization expense

Inter-segment elimination represents services and other transactions, principally intercompany investments and loans, between the Company’s reportable segments that are eliminated on consolidation.

In preparation of the Separation, SYNNEX entered into a Commercial Agreement with Concentrix effective on December 1, 2020 that governs the provision of ongoing services and other items between SYNNEX and Concentrix.

Geographic information

The Company attributes revenues from external customers to the country from where Technology Solutions products are delivered and the country of domicile of the Concentrix legal entity that is party to the client contract.

Shown below are the countries that accounted for 10% or more of the Company’s revenue and property and equipment, net, for the periods presented:

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The Company attributes revenues from external customers to the country from where products are delivered.

Except for the United States, no other country accounted for 10% or more of the Company’s revenue for the periods presented.

Except for the United States, no other country accounted for 10% or more of the Company’s property and equipment, net, less capitalized software and application software, for the periods presented:

Fiscal Years Ended November 30,

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NOTE 14—RELATED PARTY TRANSACTIONS:

The Company has a business relationship with MiTAC Holdings Corporation (“MiTAC Holdings”), a publicly-traded company in Taiwan, which began in 1992 when MiTAC Holdings became the Company’s primary investor through its affiliates.

As of both November 30, 2020 and 2019, MiTAC Holdings and its affiliates beneficially owned approximately 18 % of the Company's outstanding common stock.

The Company has a business relationship with MiTAC Holdings Corporation (“MiTAC Holdings”), a publicly-traded company in Taiwan, which began in 1992 when MiTAC Holdings became one of the Company’s primary investors through its affiliates.

As of November 30, 2021 and 2020, MiTAC Holdings and its affiliates beneficially owned approximately 9.5 % and 18 % of the Company's outstanding common stock, respectively.

Matthew Miau, Chairman Emeritus of the Company’s Board of Directors and a director, is the Chairman of MiTAC Holdings and a director or officer of MiTAC Holdings’ affiliates.

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Beneficial ownership of the Company’s common stock by MiTAC Holdings

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Miau is affiliated with any person(s), entity, or entities that hold a majority interest in MiTAC Incorporated.

MiTAC Holdings generally has influence over the Company regarding matters submitted to stockholders for consideration, including any merger or acquisition of the Company.

Among other things, this could have the effect of delaying, deterring or preventing a change of control over the Company.

The following table presents the Company's transactions with MiTAC Holdings and its affiliates for the periods indicated:

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Sale of products to MiTAC Holdings and affiliates

Reimbursements received (payments made) for rent and overhead costs for use of facilities by MiTAC Holdings and affiliates, net

Payments made for rent and overhead costs for use of facilities of MiTAC Holdings and affiliates, net

The following table presents the Company’s receivable from and payable to MiTAC Holdings and its affiliates for the periods presented:

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Payable to related parties (included in Accounts payable)

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The Company’s business relationship with MiTAC Holdings and its affiliates has been informal and is generally not governed by long-term commitments or arrangements with respect to pricing terms, revenue or capacity commitments.

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Neither MiTAC Holdings nor Synnex Technology International is restricted from competing with the Company.

NOTE 13—PENSION AND EMPLOYEE BENEFITS PLANS:

NOTE 15—EMPLOYEE BENEFITS PLANS:

The Company has 401(k) plans in the United States under which eligible employees may contribute up to the maximum amount as provided by law.

Employees become eligible to participate in these plans on the first day of the month after their employment date.

Employees generally become eligible to participate in these plans on the first day of the month after their employment date.

The Company may make discretionary contributions under the plans.

Employees in most of the Company's international subsidiaries are covered by government mandated defined contribution plans.

Employees in certain of the Company's international subsidiaries are covered by government mandated defined contribution plans.

During fiscal years 2021, 2020 and 2019, the Company contributed $ 12,131 , $ 3,561 and $ 3,568 , respectively, to defined contribution plans.

The Company has a deferred compensation plan for certain directors and officers.

Distributions under the plan are subject to Section 409A of the United States Tax Code.

The Company may invest balances in the plan in trading securities reported on recognized exchanges.

As of November 30, 2020 and 2019, the deferred compensation liability balance was $ 4,628 and $ 5,389 , respectively.

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Defined Benefit Plans

The Company has defined benefit pension or retirement plans for eligible employees in certain international subsidiaries.

Benefits under these plans are primarily based on years of service and compensation during the years immediately preceding retirement or termination of participation in the plans.

In addition, as part of a prior acquisition, the Company acquired a frozen defined benefit pension plan, which includes both a qualified and non-qualified portion, for all eligible employees in the U.S.

(“the cash balance plan”) and unfunded defined benefit plans for certain eligible employees in the Philippines, Malaysia and France.

The pension benefit formula for the cash balance plan is determined by a combination of compensation, age-based credits and annual guaranteed interest credits.

The qualified portion of the cash balance plan has been funded through contributions made to a trust fund.

The plan assumptions are evaluated annually and are updated as deemed necessary.

Net benefit costs were $ 13,823 , $ 10,308 and $ 3,960 , during fiscal years 2020, 2019 and 2018, respectively.

The Company's measurement date for all defined benefit plans and other postretirement benefits is November 30 and the plan assumptions are evaluated annually and are updated as deemed necessary.

The status of employee defined benefit plans is summarized below:

Year Ended November 30,

Change in Benefit Obligation:

Benefit obligation at beginning of year

Interest cost

Actuarial (gain) loss

Benefits paid

Foreign currency adjustments

Projected obligation at end of year

Change in Plan Assets:

Fair value of plan assets at beginning of year

Actual return on assets

Employer contributions

Employee contributions

Foreign currency adjustments

Fair value of plan assets at end of year

Funded Status of Plans:

Unfunded status

Amounts recognized in the Consolidated Balance Sheet as of November 30, 2020 and 2019 consist of:

As of November 30,

Current liability

Non-current liability

The following weighted-average rates were used in determining the benefit obligations at November 30, 2020 and 2019.

Discount rate

Expected long-term rate of return on plan assets

Expected rate of future compensation growth

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The following weighted-average rates were used in determining the pension costs during fiscal years ended November 30, 2020, 2019 and 2018:

Discount rate

Expected long-term rate of return on plan assets

Expected rate of future compensation growth

The range of discount rates utilized in determining the pension cost and projected benefit obligation of the Company's defined benefit plans reflects a lower prevalent rate applicable to the frozen cash balance plan for eligible employees in the U.S.

and a higher applicable rate for the unfunded defined benefit plan for certain eligible employees in the Philippines, France, India, Japan and Malaysia.

The plans outside the U.S.

represented approximately 26 % and 24 %, respectively, of the Company's total projected benefit obligation for all plans as of November 30, 2020 and 2019 .

As of November 30, 2020 and 2019, plan assets for the cash balance plan consisted of common/collective trusts (of which approximately 60 % are invested in equity backed funds and approximately 40 % are invested in funds in fixed income instruments) and a private equity fund.

The Company's targeted allocation was 60 % equity and 40 % fixed income.

The investment objectives for the plan assets are to generate returns that will enable the plan to meet its future obligations.

The Company’s expected long-term rate of return was determined based on the asset mix of the plan, projected returns, past performance and other factors.

The Company has satisfied its ERISA funding requirements through 2020.

The following table sets forth the fair value of those plan assets as of November 30, 2020 and 2019:

As of November 30,

Asset Category:

Cash and cash equivalents

Equity securities:

International equity

Investment funds

Limited partnership

Total investments

The cash balance plan holds level 2 investments in common/collective trust funds that are public investment vehicles valued using a net asset value provided by the manager of each fund based on the underlying net assets owned by the fund, divided by the number of shares outstanding.

The Company’s cash balance plan holds Level 3 investments within equity funds that primarily invest in domestic early stage capital funds.

Benefit Payments

The following table details expected benefit payments for the assumed cash balance plan:

Fiscal Years Ending November 30,

Thereafter (2026-2030)

No plan assets are expected to be returned to the Company during fiscal year 2021.

The Company expects to make approximately $ 8,319 in contributions during fiscal year 2021.

The Company also expects approximately $ 4,652 of actuarial loss included in AOCI will be recognized during fiscal year 2021.

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Substantially all of the defined benefit plans are related to the Concentrix segment.

Subsequent to November 30, 2020, upon completion of the Separation, the Company no longer has any obligation under the plans related to the Concentrix segment.

The Company’s defined benefit plans sponsored by certain international subsidiaries are not material to operations.

NOTE 16—LEASES:

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The following table presents the various components of lease costs.

Fiscal Year Ended

Fiscal Years Ended November 30,

Operating lease cost

Short-term lease cost

Variable lease cost

Short-term and variable lease cost

Sublease income

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* Imputed interest represents the difference between undiscounted cash flows and discounted cash flows.

Subsequent to November 30, 2020, upon completion of the Separation, undiscounted future cash flows of $ 611,568 which were part of lease agreements entered into by Concentrix are no longer the Company’s obligation.

During the fiscal years ended November 30, 2019 and 2018, rent expense was $ 257,809 and $ 136,870 , respectively.

Sublease income was immaterial for both these years.

The following amounts were recorded in the Company's Consolidated Balance Sheet as of November 30, 2020:

During the fiscal year ended November 30, 2019, rent expense was $ 28,186 .

Sublease income was immaterial for this year.

The following amounts were recorded in the Company's Consolidated Balance Sheet as of November 30, 2021 and 2020:

Operating leases

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Other long-term liabilities

The following table presents s upplemental cash flow information related to the Company's operating leases for fiscal year ended November 30, 2020.

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The following table presents s upplemental cash flow information related to the Company's operating leases for the fiscal years ended November 30, 2021 and 2020.

Cash payments related to variable lease costs and short-term leases are not included in the measurement of operating lease liabilities, and, as such, are excluded from the amounts below :

Fiscal Year Ended

Fiscal Years Ended November 30,

Cash flow information

November 30, 2020

Cash paid for amounts included in the measurement of lease liabilities

Non-cash ROU assets obtained in exchange for lease liabilities (subsequent to initial adoption)

The weighted-average remaining lease term and discount rate as of November 30, 2020 were as follows:

The weighted-average remaining lease term and discount rate as of November 30, 2021 and 2020 were as follows:

Operating lease term and discount rate

Operating Leases

Weighted-average remaining lease term (years)

Weighted-average discount rate

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Future minimum contractually required cash payment obligations under non-cancellable lease agreements as of November 30, 2019 were as follows:

Fiscal Years Ending November 30,

Total minimum lease payments

NOTE 17—INCOME TAXES:

The sources of income before the provision for income taxes are as follows:

The components of pretax income from continuing operations are as follows:

Fiscal Years Ended November 30,

United States

Provision for income taxes consists of the following:

Significant components of the provision for income taxes are as follows:

Fiscal Years Ended November 30,

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Total tax provision

On December 22, 2017, the TCJA was enacted into law.

The TCJA provided for significant changes to the U.S.

Internal Revenue Code of 1986, as amended, that impacted corporate taxation requirements.

The TCJA significantly revised the ongoing U.S.

corporate income tax law by lowering the U.S.

federal corporate income tax rate from 35 % to 21%, implementing a territorial tax system, imposing a one-time tax on foreign unremitted earnings and setting limitations on deductibility of certain costs (e.g., interest expense), among other things.

During fiscal year 2018, the Company accounted for the impact of the TCJA resulting in additional income tax expense of $ 33,109 .

The significant components of this expense were (i) the one-time deemed repatriation tax on unremitted non-U.S.

earnings and profits that were previously tax deferred and other tax impacts of the TCJA, which resulted in an increase in income tax expense, net of deductions and credits, of $ 59,823 and (ii) the remeasurement of net deferred tax liabilities at the lower enacted U.S.

federal corporate tax rate, which resulted in a decrease of $ 26,714 in income tax expense.

The following presents the breakdown of net deferred tax liabilities:

The breakdown of net deferred tax assets and liabilities are as follows:

As of November 30,

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Deferred tax liabilities

Total net deferred tax liabilities

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Net deferred tax liabilities consist of the following:

Total net deferred tax assets (liabilities)

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The significant components of the Company’s deferred tax assets and liabilities are as follows:

As of November 30,

Operating lease liability

Net operating losses

Accruals and other reserves

Unrealized losses on cash flow hedges

Loss carryforwards

Lease liabilities

Accrued liabilities

Foreign tax credit carryforwards

Disallowed interest expense

Allowance for doubtful accounts and sales return reserves

Inventory reserves

Capitalized inventory costs

Unrealized losses on cash flow hedges

Acquisition and transaction related costs

Share-based compensation expense

Foreign tax credit

Deferred revenue

Deferred and prepaid compensation

Property, Equipment and Intangible assets

Gross deferred tax assets

Long-lived assets

valuation allowance

Total deferred tax assets

Intangible assets

Unremitted non-U.S.

Long-lived assets

Lease right-of-use assets

Deferred costs

Capitalized marketing program costs

Total deferred tax liabilities

Net deferred tax liabilities

The valuation allowance relates primarily to certain state and foreign net operating loss carry forward, foreign deferred items and state credits.

The Company’s assessment is that it is not more likely than not that these deferred tax assets will be realized.

A reconciliation of the statutory United States federal income tax rate to the Company’s effective income tax rate is as follows:

Net deferred tax (liability) asset

The increase in the Company's overall deferred tax liability position is primarily due to the increase in the Company's identified intangible assets recorded as a result of the Merger.

The net change in the deferred tax valuation allowances in fiscal 2021was an increase of $ 117.9 million primarily resulting from the Merger.

The valuation allowance at November 30, 2021 primarily relates to carryforwards for foreign net operating losses and foreign tax credits in the United States.

The valuation allowance at November 30, 2020 relates primarily to certain state and foreign net operating loss carryforwards and state credits.

The Company considers all positive and negative evidence available in determining the potential of realizing deferred tax assets.

To the extent that the Company generates consistent taxable income within those operations with valuation allowances, the Company may reduce the valuation allowances, thereby reducing income tax expense and increasing net income in the period the determination is made.

The Company’s net operating loss carryforwards totaled $ 430.2 million at November 30, 2021.

The majority of the net operating losses have an indefinite carryforward period with the remaining portion expiring in fiscal years 2022 through 2038.

In addition, the Company has an immaterial net amount of state net operating losses.

The Company’s foreign tax credit carryforwards in the United States totaled $ 54.8 million at November 30, 2021.

The foreign tax credits have a ten-year carryforward period, and the majority is set to expire in fiscal year 2028 .

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The reconciliation of the statutory United States federal income tax rate to the Company’s effective income tax rate is as follows:

Fiscal Years Ended November 30,

Federal statutory income tax rate

State taxes, net of federal income tax benefit

United States federal statutory income tax rate

State income taxes, net of federal income tax benefit

Global intangible low taxed income

Foreign taxes

Tax on anticipated distributions from subsidiaries

Adjustments related to the TCJA

Uncertain tax benefits

Tax on foreign earnings different than US federal rate

Net changes in deferred tax valuation allowances

Adjustments related to the Tax Cuts and Jobs Act

Interest not subject to tax, net

Capital loss carryback

Net changes in reserves for uncertain tax positions

Effective income tax rate

The Company’s United States business has sufficient cash flow and liquidity to fund its operating requirements and the Company expects and intends that profits earned outside the United States will be fully utilized and reinvested outside of the United States with the exception for earnings of certain previously acquired foreign entities.

The Company recorded deferred tax liabilities related to non-U.S.

withholding taxes related to the earnings likely to be repatriated in the future.

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As of November 30, 2020, the Company had approximately $ 1,814,000 of undistributed earnings of its non-U.S.

In connection with the Merger, the Company restructured its foreign financing structure, as well as select legal entities in anticipation of legally integrating legacy Tech Data and SYNNEX foreign operations.

In addition to the treasury efficiencies, these restructurings resulted in a one-time domestic capital loss which would offset certain domestic capital gains when carried back under United States tax law to tax year 2020, resulting in a tax benefit of approximately $ 45 million.

As of November 30, 2021, the Company had approximately $ 619.7 million of undistributed earnings of its non-U.S.

subsidiaries for which it has not provided for non-U.S.

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subsidiaries for which the earnings are permanently reinvested.

As of November 30, 2020, the Company had net operating loss carry forward of approximately $ 41,700 and $ 36,590 for federal and state purposes, respectively.

The federal net operating loss carry forward will start expiring in fiscal year ending November 30, 2021 , if not used, and the state net operating loss carry forward will start expiring in fiscal year ending November 30, 2021 , if not used.

The Company also had approximately $ 161,150 of foreign net operating loss carry forward that will also start expiring in fiscal year ending November 30, 2021 if not used.

In addition, the Company had approximately $ 7,600 of various federal and state income tax credit carry forwards that if not used, will begin expiring in fiscal year ending November 30, 2021 .

Utilization of the acquired loss carry forwards may be limited pursuant to Section 382 of the Internal Revenue Code of 1986.

The Company enjoys tax holidays in certain jurisdictions, primarily, China, Costa Rica, Nicaragua and the Philippines.

The tax holidays provide for lower or zero rates of taxation and require various thresholds of investment and business activities in those jurisdictions.

The Company has been granted tax holidays in certain jurisdictions, primarily, China.

The tax holidays provide for lower rates of taxation and require various thresholds of investment and business activities in those jurisdictions.

Certain tax holidays begin to expire in fiscal year 2021 .

The estimated range of tax benefits from the above tax holidays on diluted earnings per share for fiscal years 2020, 2019 and 2018 were approximately $ 0.25 to $ 0.29 , $ 0.06 to $ 0.07 and $ 0.10 to $ 0.12 , respectively.

The tax benefits from the above tax holidays for fiscal years 2021, 2020 and 2019 were not material.

The estimates and assumptions used by the Company in computing the income taxes reflected in the Company’s consolidated financial statements could differ from the actual results reflected in the income tax returns filed during the subsequent year.

Adjustments are recorded based on filed returns when such returns are finalized or the related adjustments are identified.

The aggregate changes in the balances of gross unrecognized tax benefits, excluding accrued interest and penalties, during fiscal years 2021, 2020 and 2019 were as follows:

Balance as of November 30, 2017

Additions based on tax positions related to the current year

Additions for tax positions of prior years and acquisition

Lapse of statute of limitations

Changes due to translation of foreign currencies

Balance as of November 30, 2018

Additions based on tax positions related to the current year

Additions for tax positions of prior years and acquisition

Lapse of statute of limitations

Changes due to translation of foreign currencies

Balance as of November 30, 2019

Additions based on tax positions related to the current year

Additions for tax positions of prior years and acquisition

Reductions for tax positions of prior years

Lapse of statute of limitations

For the year ended November 30:

Gross unrecognized tax benefits at beginning of period

Increases (decreases) in tax positions for prior years and acquisitions

Decreases in tax positions for prior years

Increases in tax positions for current year

Expiration of statutes of limitation

Changes due to translation of foreign currencies

Balance as of November 30, 2020

The Company conducts business globally and files income tax returns in various U.S.

and foreign tax jurisdictions.

The Company is subject to continuous examination and audits by various tax authorities.

Significant audits are underway in the United States, Canada and India.

The Company is not aware of any material exposures arising from these tax audits or in other jurisdictions not already provided for.

Although timing of the resolution of audits and/or appeals is highly uncertain, the Company believes it is reasonably possible that the total amount of unrecognized tax benefits as of November 30, 2020 will not materially change in the next twelve months.

The Company is no longer subject to U.S.

federal income tax audit for returns covering years through fiscal 2015.

Gross unrecognized tax benefits at end of period

As of November 30, 2021, the amount of unrecognized tax benefits that, if recognized, would impact the effective tax rate was $ 26.3 million.

Unrecognized tax benefits that have a reasonable possibility of significantly decreasing within the 12 months following November 30, 2021 would not have a material impact on the tax rate.

The Company recognizes interest and penalties related to unrecognized tax benefits in the provision for income taxes.

The Company’s accrued interest and penalties at November 30, 2021, would not have a material impact on the effective tax rate if reversed.

The provision for income taxes for each of the fiscal years ended November 30, 2021, 2020 and 2019 includes interest expense on unrecognized income tax benefits for current and prior years which is not significant to the Company’s Consolidated Statement of Income.

The change in the balance of accrued interest for fiscal

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2021, 2020 and 2019, includes the current year end accrual, an interest benefit resulting from the expiration of statutes of limitation, and the translation adjustments on foreign currencies.

The Company conducts business primarily in the Americas, Europe and APJ, and as a result, one or more of its subsidiaries files income tax returns in the U.S.

federal, various state, local and foreign tax jurisdictions.

In the normal course of business, the Company is subject to examination by taxing authorities.

The Company is no longer subject to examinations by the Internal Revenue Service for years before fiscal 2018.

The Company is no longer subject to foreign or state income tax audits for returns covering years through 2003, and fiscal year 2010, respectively.

As of November 30, 2020, $ 60,416 of the total unrecognized tax benefits, net of federal benefit, would affect the effective tax rate, if realized.

The Company’s policy is to include interest and penalties related to income taxes, including unrecognized tax benefits, within the provision for income taxes.

As of November 30, 2020 and 2019, the Company had accrued $ 15,686 and $ 15,627 , respectively, in income taxes payable related to accrued interest and penalties.

In preparation of the Separation, SYNNEX entered into a Tax Matters Agreement with Concentrix effective on December 1, 2020 that governs the rights and obligations of SYNNEX and Concentrix for certain pre-Separation tax liabilities.

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In certain jurisdictions SYNNEX and Concentrix have joint and several liability for past income tax liabilities and accordingly, SYNNEX could be legally liable under applicable tax law for such liabilities and required to make additional tax payments.

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In addition, if the distribution of Concentrix' common shares to the SYNNEX stockholders is determined to be taxable, Concentrix and SYNNEX would share the tax liability equally, unless the taxability of the distribution is the direct result of action taken by either Concentrix or SYNNEX subsequent to the distribution in which case the party causing the distribution to be taxable would be responsible for any taxes imposed on the distribution.

NOTE 18—COMMITMENTS AND CONTINGENCIES:

The Company was contingently liable as of November 30, 2020 under agreements to repurchase repossessed inventory acquired by flooring companies as a result of default on floor plan financing arrangements by the Company's customers.

These arrangements are described in Note 8 and do not have expiration dates.

As is customary in the technology industry, to encourage certain customers to purchase products from us, the Company also has other financing agreements with financial institutions to provide inventory financing facilities to the Company’s customers and allow certain customers of the Company to finance their purchases directly with the financial institutions.

The Company is contingently liable to repurchase inventory sold under these agreements in the event of any default by its customers under the agreement and such inventory being repossessed by the financial institutions.

As the Company does not have access to information regarding the amount of inventory purchased from the Company, still on hand with the customer at any point in time, the Company’s repurchase obligations relating to inventory cannot be reasonably estimated.

Losses, if any, would be the difference between the repossession cost and the resale value of the inventory.

There have been no repurchases through November 30, 2020 under these agreements and the Company is not aware of any pending customer defaults or repossession obligations.

Repurchases under these arrangements have been insignificant to date and the Company is not aware of any pending customer defaults or repossession obligations.

The Company believes that, based on historical experience, the likelihood of a material loss pursuant to these inventory repurchase obligations is remote.

The French Autorité de la Concurrence (“Competition Authority”) began in 2013 an investigation into the French market for certain products of Apple, Inc., (“Apple”) for which the Company is a distributor.

In March 2020, the Competition Authority imposed fines on Tech Data, on another distributor, and on Apple, finding that Tech Data entered into an anticompetitive agreement with Apple regarding volume allocations of Apple products.

The fine imposed on Tech Data was € 76 million (approximately $ 86 million as of November 30, 2021).

The Company has vigorously contested the arguments of the Competition Authority, and the Company has appealed its determination to the French courts, seeking to set aside or reduce the fine.

Although the Company believes it has strong arguments on appeal, the Company has determined that the best estimate of probable loss related to this matter as of November 30, 2021 is € 36 million (approximately $ 41 million as of November 30, 2021).

Under French law, the pendency of the Company’s appeal does not suspend the obligation to pay the fine.

Tech Data agreed with the French authorities to make eight equal installment payments in relation to the fine assessed for a total amount of € 22.8 million on a quarterly basis from January 2021 through October 2022 .

As of November 30, 2021, the Company has an accrual established for this matter of € 24.6 million ($ 27.7 million as of November 30, 2021) that represents the total estimate of probable loss less installment payments made to date.

If the appeal process is not completed prior to the end of December 2022, the Company may be required to pay further amounts towards the full fine assessed by the Competition Authority before the Company’s appeal is finally determined.

However, any additional amounts that may need to be paid have not yet been determined.

Additionally, the Company has provided a third-party surety bond to the Competition Authority to guarantee the payment of the amount of the fine and interest, if applicable.

A civil lawsuit related to this matter, alleging anticompetitive actions in association with the established distribution networks for Apple, Tech Data and another distributor was filed by eBizcuss.

The Company is currently evaluating this matter and cannot currently estimate the probability or amount of any potential loss.

From time to time, the Company receives notices from third parties, including customers and suppliers, seeking indemnification, payment of money or other actions in connection with claims made against them.

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Under the Separation and Distribution agreement, SYNNEX agreed to indemnify Concentrix, each of its subsidiaries and each of their respective directors, officers and employees from and against all liabilities relating to, arising out of or resulting from, among other matters, the liabilities allocated to SYNNEX as part of the Separation.

Similarly, Concentrix agreed to indemnify SYNNEX, each of its subsidiaries and each of their respective directors, officers and employees from and against all liabilities relating to, arising out of or resulting from, among other matters, the liabilities allocated to Concentrix as part of the Separation.

SYNNEX expects Concentrix to fully perform under the terms of the separation and distribution agreement.

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other matters, the liabilities allocated to Concentrix as part of the Separation.

SYNNEX expects Concentrix to fully perform under the terms of the S eparation and D istribution agreement.

Under the Separation and Distribution agreement, SYNNEX and Concentrix agreed to cooperate with each other in managing litigation related to both companies' businesses.

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The Company does not believe that the above commitments and contingencies will have a material adverse effect on the Company’s results of operations, financial position or cash flows.

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NOTE 17—SUBSEQUENT EVENTS:

As described in Note 1 , on December 1, 2020, the Company completed the previously announced separation of Concentrix, its customer experience services businesses, into an independent public company in a tax-free transaction for federal income tax purposes .

In order to present the impact of the Separation, the Company has prepared t he following unaudited pro forma condensed consolidated balance sheet as if the Separation occurred on November 30, 2020.

The unaudited pro forma condensed consolidated balance sheet has been prepared for illustrative and informational purposes only and does not purport to project the future financial position of SYNNEX following the completion of the Separation.

The pro forma adjustments include classification of intercompany balances as third party balances and a charge to SYNNEX’ consolidated retained earnings to reflect the distribution of Concentrix stock to its stockholders.

Pro forma SYNNEX

Current assets:

Cash and cash equivalents

Accounts receivable, net

Receivable from vendors, net

Other current assets

Total current assets

Property and equipment, net

Intangible assets, net

Deferred tax assets

LIABILITIES AND EQUITY

Current liabilities:

Borrowings, current

Accounts payable

Accrued compensation and benefits

Other accrued liabilities

Income taxes payable

Total current liabilities

Long-term borrowings

Other long-term liabilities

Deferred tax liabilities

Total liabilities

Stockholders' equity

Total liabilities and equity

As described in Note 3 , on January 11, 2021 , the Company declared the reinstatement of a quarterly cash dividend.

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SELECTED QUARTERLY CONSOLIDATED FINANCIAL DATA (Unaudited)

The following table presents selected unaudited consolidated financial results for each of the eight quarters in the two-year period ended November 30, 2020.

In the Company’s opinion, this unaudited information has been prepared on the same basis as the audited information and includes all adjustments (consisting of only normal recurring adjustments) necessary to fairly state the financial information for the periods presented.

Fiscal Year 2020

Three Months Ended

Fiscal Year 2019

Three Months Ended

Statements of Operations Data:

(currency and share

amounts in thousands, except per share amounts)

(Amounts may not add due to rounding)

Total revenue

Cost of revenue:

Selling, general and administrative expenses

Operating income

Interest expense and finance charges, net

Other income (expense), net

Income before income taxes

Provision for income taxes

Earnings per common share:

Weighted-average common shares outstanding -

Cash dividends declared per share

EPS for each quarter is computed using the weighted-average number of shares outstanding during that quarter, while EPS for the fiscal year is computed using the weighted-average number of shares outstanding during the fiscal year.

The sum of EPS for each of the four quarters may not equal EPS for the fiscal year.

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SYNNEX CORPORATION

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TD SYNNEX CORPORATION

SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS

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Allowance for deferred tax assets

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Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

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 7A. Quantitative and Qualitative Disclosures About Market Risk