What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2023-02-28 compared with 2022-02-25 · 312 added, 247 removed, 963 unchanged (37% of the section changed)

31 unchanged sentences

We believe that our audits provide a reasonable basis for our opinions.

As described in the Report of Management on Internal Control over Financial Reporting, management has excluded Blue Prism from its assessment of internal control over financial reporting as of December 31, 2022 because they were acquired by the Company in a purchase business combination during 2022.

We have also excluded Blue Prism from our audit of internal control over financial reporting.

Blue Prism and its wholly-owned subsidiaries' total assets and total revenues excluded from management’s assessment and our audit of internal control over financial reporting collectively represent approximately 1% and 4%, respectively, of the related consolidated financial statement amounts as of and for the year ended December 31, 2022.

Definition and Limitations of Internal Control over Financial Reporting

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

(ii) 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;

(ii) 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 (iii) 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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Critical Audit Matters

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

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

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Goodwill Impairment Assessment –

Health Business Reporting Unit

As described in Notes 2 and 9 to the consolidated financial statements, the Company’s consolidated goodwill balance was $8,045.5 million as of December 31, 2021.

As described in Notes 2 and 9 to the consolidated financial statements, the Company’s consolidated goodwill balance was $8,863.0 million as of December 31, 2022, a portion of which relates to the health business reporting unit.

Management tests goodwill annually for impairment as of December 31 and in interim periods if certain events occur or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount.

Management measures the fair value of the Company’s reporting units utilizing the income method.

Significant judgments required to estimate the fair value of the Company’s reporting units include determining appropriate discount rates, revenue growth rates and estimating the margin on the Company’s revenues to determine earnings before interest, income taxes, depreciation, amortization and stock-based compensation.

The principal considerations for our determination that performing procedures relating to the goodwill impairment assessment of the health business reporting unit is a critical audit matter are (i) the significant judgment by management when developing the fair value measurement of the reporting unit;

(ii) a high degree of auditor judgment, subjectivity and effort in performing procedures and evaluating management’s significant assumptions related to the discount rate, revenue growth rates, and the margin on the Company’s revenues to determine earnings before interest, income taxes, depreciation, amortization and stock-based compensation;

Significant judgment is required to determine appropriate revenue growth rates and to estimate the fair value of the Company’s reporting units.

(ii) a high degree of auditor judgment, subjectivity and effort in performing procedures and evaluating management’s significant assumption related to the revenue growth rates;

and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to management’s quantitative goodwill impairment assessment, including controls over the determination of the fair value of the health business reporting unit.

These procedures also included, among others, testing management’s process for developing the fair value estimate of the health business reporting unit;

evaluating the appropriateness of the income method;

testing the completeness and accuracy of underlying data used in the income method;

and evaluating the significant assumptions used by management related to the discount rate, revenue growth rates, and the margin on the Company’s revenues to determine earnings before interest, income taxes, depreciation, amortization and stock-based compensation.

Evaluating management’s assumptions related to the revenue growth rates and margin on the Company’s revenues to determine earnings before interest, income taxes, depreciation, amortization and stock-based compensation involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the reporting unit, (ii) the consistency with external market and industry data, and (iii) whether these assumptions were consistent with evidence obtained in other areas of the audit.

Professionals with specialized skill and knowledge were used to assist in the evaluation of the income method and the discount rate.

These procedures included testing the effectiveness of controls relating to management’s quantitative goodwill impairment assessment, including controls over the valuation of the health business reporting unit.

These procedures also included, among others, (i) testing management’s process for developing the fair value estimate of the health business reporting unit;

(ii) evaluating the appropriateness of the income method;

(iii) testing the completeness and accuracy of underlying data used in the income method;

and (iv) evaluating the reasonableness of the significant assumption used by management related to the revenue growth rates.

Evaluating management’s assumption related to the revenue growth rates involved evaluating whether the assumption used by management was reasonable considering (i) the current and past performance of the reporting unit;

(ii) the consistency with external market and industry data;

and (iii) whether this assumption was consistent with evidence obtained in other areas of the audit.

Professionals with specialized skill and knowledge were used to assist in evaluating the appropriateness of the income method.

Acquisition of Blue Prism Group PLC –

Valuation of Completed Technology and Customer Relationships Intangible Assets

As described in Note 8 to the consolidated financial statements, the Company completed the acquisition of Blue Prism Group PLC (Blue Prism) for a cash purchase price of $1.5 billion, net of cash acquired, which resulted in $250 million of completed technology and $520 million of customer relationships intangible assets being recorded.

The fair value of the completed technology and customer relationships was determined using the income approach.

Specifically, the relief-from-royalty method was utilized for completed technology and the excess earnings method was utilized for customer relationships.

Significant assumptions used in the determination of fair value for completed technology were projected future revenues, royalty rate, obsolescence rate and discount rate.

Significant assumptions used in the determination of fair value for customer relationships were projected future revenues and costs and discount rate.

The principal considerations for our determination that performing procedures relating to the valuation of the completed technology and customer relationships intangible assets acquired in the Blue Prism acquisition is a critical audit matter are (i) the significant judgment by management when developing the fair value estimate of the completed technology and customer relationships intangible assets acquired;

(ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to the projected future revenues, royalty rate, obsolescence rate and discount rate for completed technology, and the projected future revenues and costs and discount rate for the customer relationships intangible asset;

and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to the acquisition accounting, including controls over management’s valuation of the completed technology and customer relationships intangible assets and the development of the significant assumptions related to the projected future revenues, royalty rate, obsolescence rate and discount rate for completed technology, and the projected future revenues and costs and discount rate for the customer relationships.

These procedures also included, among others, (i) reading the purchase agreement;

(ii) testing management’s process for developing the fair value estimates of the completed technology and customer relationships intangible assets, (iii) evaluating the appropriateness of the relief-from-royalty and excess earnings valuation methods;

(iv) testing the completeness and accuracy of data used in the valuation methods;

and (v) evaluating the reasonableness of the significant assumptions used by management related to the projected future revenues, royalty rate, obsolescence rate and discount rate for completed technology, and the projected future revenues and costs and discount rate for the customer relationships.

Evaluating the reasonableness of the projected future revenues and projected future revenues and costs considered (i) the past performance of the acquired business and (ii) consistency with external market and industry data.

Professionals with specialized skill and knowledge were used to assist in evaluating the appropriateness of the valuation methods and the reasonableness of the royalty rate, obsolescence rate, and discount rate assumptions.

/s/ PricewaterhouseCoopers LLP

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Intangible and other assets, net of accumulated amortization of $ 3,445.4 and $ 2,890.5 , respectively (Note 9)

Liabilities and Stockholders’

Liabilities, Redeemable Noncontrolling Interest and Equity

Current liabilities:

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Long-term debt, net of current portion (Note 10)

Operating lease liabilities (Note 5)

Operating lease liabilities

Other long-term liabilities

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Commitments and contingencies (Note 18)

Redeemable noncontrolling interest (Note 6)

Stockholders’

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Noncontrolling interest (Note 12)

Total stockholders’

Total liabilities and stockholders’

Total liabilities, redeemable noncontrolling interest and equity

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

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Interest expense

Other (expense) income, net

Other income (expense), net

Equity in earnings of unconsolidated affiliates, net

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Provision for income taxes (Note 17)

Net income attributable to noncontrolling interest

Net loss (income) attributable to noncontrolling interest

Net income attributable to SS&C common stockholders

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Other comprehensive (loss) income, net of tax:

Change in unrealized income (loss) on interest rate swaps

Change in unrealized gain (loss) on interest rate swaps

Defined benefit pension adjustment

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Comprehensive income

Comprehensive income attributable to noncontrolling interest

Comprehensive loss (income) attributable to noncontrolling interest

Comprehensive income attributable to SS&C common stockholders

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Equity in earnings of unconsolidated affiliates, net

Cash distributions received from unconsolidated affiliates

Distributions received from unconsolidated affiliates

Gain on bargain purchase

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Cash flow from investing activities:

Cash paid for business acquisitions, net of cash acquired

Cash paid for asset acquisitions and business acquisitions, net of cash acquired

Additions to property and equipment

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Proceeds from sales / maturities of investments

(Contributions to) distributions received from unconsolidated affiliates

Distributions received from (contributions to) unconsolidated affiliates

Collection of other non-current receivables

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Repayments of debt

Fees paid for debt extinguishment and refinancing activities

Net increase (decrease) in client funds obligations

Payment of deferred financing fees

Net (decrease) increase in client funds obligations

Proceeds from exercise of stock options

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Proceeds from noncontrolling interests

Net provided by (used in) financing activities

Net cash (used in) provided by 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, beginning of period

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Net change in interest rate swaps (Note 11)

Defined benefit pension adjustment (Note 11)

Stock-based compensation expense

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taxes (Note 14)

Non-cash purchase price consideration

Dividends declared - $ 0.53 per share

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Balance, at December 31, 2020

Noncontrolling interest upon consolidation (Note 12)

Foreign exchange translation adjustment

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taxes (Note 14)

Non-cash purchase price consideration

Dividends declared - $ 0.68 per share

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Balance, at December 31, 2021

Noncontrolling interest upon consolidation

Foreign exchange translation adjustment

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Actual results could differ from those estimates.

The inputs into our estimates also considered the economic implications of COVID-19 on our estimates.

Principles of Consolidation

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and 5) the entity was established with non-substantive voting interests.

We are the primary beneficiary of one of our VIE's and as such have consolidated its results as discussed in Note 12 below.

We have consolidated one VIE since we are the primary beneficiary as discussed in Note 12 below.

Our investments in private equity funds meet the definition of a VIE;

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Software-enabled Services Revenue

We primarily offer software-enabled outsourcing services in which we utilize our own software to offer comprehensive fund administration services for alternative investment managers, including fund manager services, transfer agency services, funds-of-funds

services, tax processing and accounting.

We also use our own software applications to provide healthcare organizations a variety of medical and pharmacy benefit solutions to satisfy their information processing, quality of care, cost management concerns and payment integrity programs.

We also use our own software applications to provide healthcare organizations a variety of

medical and pharmacy benefit solutions to satisfy their information processing, quality of care, cost management concerns and payment integrity programs.

Our healthcare solutions include claims adjudication, benefit management, care management, business intelligence and other ancillary services.

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If the standalone selling price for a performance obligation is not directly observable, we estimate it maximizing the use of observable inputs.

For maintenance and support, we determine the standalone selling price based on the price at which we separately sell a

renewal contract and the economic relationship between licenses and maintenance.

We primarily determine the standalone selling price for sales of license arrangements using the residual approach.

For maintenance and support, we determine the standalone selling price based on the price at which we separately sell a renewal contract and the economic relationship between licenses and maintenance.

We primarily determine the standalone selling

price for sales of license arrangements using the residual approach.

In situations when the software license and the right to unspecified product upgrades are not distinct in the context of the contract, they are combined into a single performance obligation and revenue is recognized on a straight line basis over the contract duration.

For professional services, we determine the standalone selling prices based on the price at which we separately sell those services.

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The costs of sold or retired assets are removed from the related asset and accumulated depreciation accounts and any gain or loss is included in the Consolidated Statements of Comprehensive Income.

We adopted ASC 842 as of January 1, 2019 using the modified retrospective transition method.

We account for our leases in accordance with ASC 842.

We determine if our contractual agreements contain a lease at inception.

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Operating lease assets are also recognized at the commencement date as the total operating lease liability adjusted for prepaid rents, deferred rent liabilities and lease fair value adjustments that existed under ASC 840.

As most of our leases do not provide an implicit rate, we use our estimated secured incremental borrowing rate within each of the significant geographic regions in which we operate based on the information available at lease commencement date in determining the present value of lease payments.

As most of our leases do not provide an implicit rate, we use our estimated secured

incremental borrowing rate within each of the significant geographic regions in which we operate based on the information available at lease commencement date in determining the present value of lease payments.

Our lease agreements typically do not contain variable lease payments, residual value guarantees or restrictive covenants.

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We have completed the required impairment tests for goodwill and have determined that no impairment existed as of December 31, 2022 or 2021 .

On July 1, 2020, our reporting unit structure changed as a result of a change in our management structure.

As of December 31, 2019 and through June 30, 2020, we had two reporting units, one which included the DST business, and one which included the rest of our operations.

As of July 1, 2020 and through December 31, 2021, we continue to have two reporting units, though one is our health business and the other includes the rest of our operations.

As of December 31, 2022 and 2021 , we have two reporting units, one is our health business and the other includes the rest of our operations.

Our impairment analysis indicated that the fair value significantly exceeded the carrying value of each of our reporting units as of December 31, 2022 and 2021 .

We measure the fair value of our reporting units utilizing the income method.

Significant judgments required to estimate the fair value of our reporting units include determining appropriate discount rates, revenue growth rates and estimating the margin on our revenues to determine earnings before income taxes, depreciation, amortization and stock-based compensation.

Significant judgment is required to determine appropriate revenue growth rates and estimate the fair value of our reporting units.

There were no other indefinite-lived intangible assets as of December 31, 2022 or 2021.

Customer relationships, completed technology, trade names and other identifiable intangible assets are amortized over lives ranging from two to 17 years based on the ratio that cash flows for the intangible asset bear to the total of expected future cash flows for the intangible asset.

Customer relationships, completed technology, trade names and other identifiable intangible assets are amortized over lives ranging from two to 17 years .

Completed technology and customer relationships are amortized each year based on the ratio that the projected cash flows for the intangible assets bear to the total of current and expected future cash flows for the intangible asset.

Trade names are amortized on a straight line basis.

Impairment of Long-Lived Assets

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The resulting translation adjustments are excluded from net earnings and accumulated as a separate component of stockholders’

Foreign currency transaction gains and losses are included within other (expense) income in the Consolidated Statements of Comprehensive Income in the periods in which they occur.

Foreign currency transaction gains and losses are included within other income (expense) in the Consolidated Statements of Comprehensive Income in the periods in which they occur.

Comprehensive Income

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Recently Adopted Accounting Pronouncements

In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes (Topic 740) .

ASU 2019-12 simplifies the accounting for income taxes by eliminating certain exceptions to the guidance in ASC 740 related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences.

The standard also simplifies aspects of the accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill.

Certain amendments in this update must be applied on a prospective basis, certain amendments must be applied on a retrospective basis and certain amendments must be applied on a modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the effective date.

We adopted ASU 2019-12 effective January 1, 2021.

The adoption of this standard did not have a material impact on our financial position, results of operations or cash flows.

In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805):

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ASU 2021-08 should be applied prospectively to business combinations that occur after the effective date.

We have early adopted ASU 2021-08 as of January 1, 2022 on a prospective basis.

The adoption of this standard did not have a material impact on our financial position, results of operations or cash flows.

We adopted ASU 2021-08 as of January 1, 2022 on a prospective basis and applied it to the business combinations completed during 2022.

Recent Accounting Pronouncements Not Yet Effective

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GAAP if certain criteria are met to contracts, hedging relationships and other transactions that reference LIBOR or another reference rate expected to be discontinued.

In January 2021, the FASB issued Update 2021-01, Reference Rate Reform (Topic 848):

In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848):

The update provides additional optional guidance on the transition from LIBOR to include derivative instruments that use an interest rate for margining, discounting or contract price alignment.

The standard will ease, if warranted, the requirements for accounting for the future effects of the rate reform.

An entity may elect to apply the amendments prospectively through December 31, 2022.

Additionally, in December 2022, the FASB issued ASU 2022-06, Reference Rate Reform:

Deferral of the Sunset Date of Topic 848, which deferred the sunset date of Topic 848 from December 31, 2022 to December 31, 2024 to align with the amended cessation date of LIBOR.

A substantial portion of our indebtedness bears interest at variable interest rates, primarily based on USD-LIBOR.

We continue to monitor the impact the discontinuance of LIBOR or another reference rate will have on our contracts, hedging relationships and other transactions.

We are currently assessing the impact of this standard on our financial condition and results of operations.

We will apply the guidance to impacted transactions during the transition period.

The adoption of this standard does not have a material impact on our financial position, results of operations or cash flows.

Note 3—Accounts Receivable, net

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Total right-of-use assets obtained in exchange for operating lease liabilities was $ 26.5 million and $ 9.2 million for the years ended December 31, 2022 and 2021, respectively.

Our weighted-average remaining lease term and weighted-average discount rates as of December 31, 2021 we re 7.5 years and 4.8 %, respectively.

Our weighted-average remaining lease term and weighted-average discount rates as of December 31, 2022 were 7.0 years and 4.9 %, respectively.

Our weighted-average remaining lease term and weighted-average discount rates as of December 31, 2021 were 7.5 years and 4.8 %, respectively.

Lease liabilities as of December 31, 2022 are as follows (in millions):

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In addition, we serve as a lessor in other lease agreements for real estate and storage facilities.

Total gross sublease and other rental income recognized for the years ended December 31, 2021, 2020 and 2019 was appr oximately $ 9.1 m illion, $ 10.4 million and $ 9.1 million, respectively.

Total gross sublease and other rental income recognized for the years ended December 31, 2022, 2021 and 2020 was approximately $ 6.0 million, $ 9.1 million and $ 10.4 million, respectively.

Lease payments to be received as of December 31, 2022 are as follows (in millions):

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Non-marketable equity securities

Marketable equity securities

Seed capital investments

Marketable equity securities

Partnership interests in private equity funds

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Unrealized gains on equity securities held as of the end of the period

Realized gains for equity securities sold during the period

Total gains recognized in other (expense) income, net

Realized (losses) gains for equity securities sold during the period

Total gains recognized in other income (expense), net

Fair Value Measurement

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Money market funds (1)

Marketable equity securities (2)

Seed capital investments (2)

Marketable equity securities (2)

Deferred compensation liabilities (3)

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Money market funds (1)

Marketable equity securities (2)

Seed capital investments (2)

Marketable equity securities (2)

Deferred compensation liabilities (3)

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(3) Included in other long-term liabilities on the Consolidated Balance Sheet.

In each of the years ended December 31, 2021 and 2020, we provided $ 20.0 million in seed capital funding to either mutual funds or exchange-traded funds issued by one of our subsidiaries.

During the year ended December 31, 2021, we redeemed $ 13.5 million of our seed capital investments.

During the years ended December 31, 2022 and 2021, we provided $ 10.0 million and $ 20.0 million, respectively, in seed capital funding to either mutual funds or exchange-traded funds issued by one of our subsidiaries.

During the years ended December 31, 2022 and 2021, we redeemed $ 7.6 million and $ 13.5 million, respectively, of our seed capital investments.

In February 2020, we entered into a Series A Convertible Share Purchase Agreement with SILAC, Inc.

(“SILAC”), pursuant to which we acquired 40 million shares of Series A convertible preferred stock of SILAC for a purchase price of $ 40 million.

The investment is classified as a non-marketable equity security.

The investment is classified as a non-marketable equity security without a readily determinable fair value.

Stone, our Chairman of the Board of Directors and Chief Executive Officer, has an economic interest in SILAC and is a member of its board of directors.

Accordingly, SILAC is considered a related party.

During the year ended December 31, 2021, we received a preferred stock dividend from SILAC of $ 8.0 million which is recorded in Other (expense) income on our Consolidated Statements of Comprehensive Income.

During the year ended December 31, 2022, as a result of an observable price change, we recorded a fair value adjustment of $ 39.5 million to increase the carrying value of SILAC.

The fair value adjustment was recorded as an unrealized gain in Other income (expense) on our Consolidated Statements of Comprehensive Income.

In each of the years ended December 31, 2022 and 2021, we received a preferred stock dividend from SILAC of $ 8.0 million which is recorded in Other income (expense) on our Consolidated Statements of Comprehensive Income.

We have partnership interests in various private equity funds that are not included in the table above.

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The maximum risk of loss related to our private equity fund investments is limited to the carrying value of our investments in the entities.

We add new investment products such as mutual funds and exchange traded funds, through our subsidiary, ALPS Advisors, from time to time by providing the initial cash investments as seed capital.

We consolidate seed capital investments when our ownership percentage exceeds 50%.

Shares in those investments not owned by us are reflected as a redeemable noncontrolling interest on the condensed consolidated balance sheet.

Note 7—Unconsolidated Affiliates

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Excess carrying value of investment over proportionate share of net assets

International Financial Data Services L.P.

Orbit Private Investments L.P.

International Financial Data Services L.P.

Pershing Road Development Company, LLC

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Year Ended December 31,

Orbit Private Investments L.P.

International Financial Data Services L.P.

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Other unconsolidated affiliates

We have a 9.8 % ownership interest in Orbit Private Investments L.P.

(“Orbit Private Investments”), which is a provider of shareholder and pension technology.

International Financial Data Services L.P.

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The difference between the amount at which each of IFDS L.P., PRDC LLC and Broadway Square Partners is carried and the amount of underlying equity in net assets, will be amortized as a component of equity in earnings of unconsolidated affiliates over approximately 15 years, 28 years and 40 years, respectively.

In December 2021, we obtained a 9.8 % ownership interest in Orbit Private Investments L.P.

(“Orbit Private Investments”), which is a provider of shareholder and pension technology, for $ 86.0 million.

Equity in earnings of other unconsolidated affiliates for the year ended December 31, 2021 includes a $ 23.4 million gain from the Kansas City Downtown Hotel Group, L.L.C unconsolidated affiliate as a result of a sale of its primary asset.

Equity in earnings of other unconsolidated affiliates for the year ended December 31, 2021 includes a $ 23.4 million gain from the Kans as City Downtown Hotel Group, L.L.C unconsolidated affiliate as a result of a sale of its primary asset.

The following tables summarize related party transactions and balances outstanding with our related parties, which is primarily comprised of transactions with our unconsolidated affiliates (in millions):

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and payments to other unconsolidated real estate joint ventures for rent and other facility costs.

During the year ended December 31, 2022, we received a distribution of $ 64.5 million from our unconsolidated affiliate, Pershing Road Development Company, LLC (“PRDC”), which reduced our investment in the affiliate.

In addition, the interest rate swap agreement to which PRDC was a party to was terminated.

For the year ended December 31, 2021, distributions received include $ 10.0 million return on investment and $ 20.0 million return of investment related to our investments in IFDS L.P.

and the Kanas City Downtown Hotel Group, L.L.C., respectively.

and the Kansas City Downtown Hotel Group, L.L.C., respectively.

For the year ended December 31, 2020, distributions received include $ 8.0 million return on investment related to our investments in IFDS L.P.

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2022 Acquisitions

On March 16, 2022 , we purchased all of the outstanding stock of Blue Prism Group plc (“Blue Prism”) for approximately $ 1.6 billion in cash, plus the costs of effecting the transaction pursuant to a Scheme of Arrangement entered into under the U.K.

Takeover Code.

We financed the acquisition by entering into an Incremental Joinder (the “Incremental Joinder”) to the amended and restated credit agreement.

Blue Prism is a global leader in enterprise robotics process automation and intelligent automation.

The net assets and results of operations of Blue Prism have been included in our Consolidated Financial Statements from March 16, 2022.

The fair value of the intangible assets, consisting of customer relationships, completed technology and trade names, was determined using the income approach.

Specifically, the relief-from-royalty method was utilized for completed technology and trade names, and the excess earnings method was utilized for customer relationships.

Significant assumptions used in the determination of fair value for completed technology were projected future revenues, royalty rate, obsolescence rate and discount rate.

Significant assumptions used in the determination of fair value for customer relationships were projected future revenues, costs and discount rate.

Customer relationships, completed technology and trade names are expected to be amortized over approximately fifteen, eight and fourteen years, respectively, in each case the estimated life of the assets.

The remainder of the purchase price was allocated to goodwill and is not tax deductible.

The Consolidated Statements of Comprehensive Income for the year ended December 31, 2022 includes $ 201.2 milli on in revenues from Blue Prism’s operations.

Blue Prism generates revenues primarily from software license fees and related maintenance and service fees.

On March 25, 2022 , we purchased all of the outstanding stock of Hubwise Holdings Limited (“Hubwise”) for approximately $ 75.0 million in cash, plus the costs of effecting the transaction.

Hubwise is a regulated business-to-business investment platform serving advisers, discretionary wealth managers and self-directed direct-to-consumer propositions.

The net assets and results of operations of Hubwise have been included in our Consolidated Financial Statements from March 25, 2022.

The fair value of the intangible assets, consisting of customer relationships, completed technology and trade names, was determined using the income approach.

Specifically, the relief-from-royalty method was utilized for completed technology and trade names, and the excess earnings method was utilized for customer relationships.

Customer relationships, completed technology and trade name are expected to be amortized over approximately twelve, eight and fourteen years, respectively, in each case the estimated life of the assets.

The remainder of the purchase price was allocated to goodwill and is not tax deductible.

The Consolidated Statements of Comprehensive Income for the year ended December 31, 2022 includes $ 4.1 milli on in revenues from Hubwise’s operations.

On August 23, 2022 , we purchased the sell-side Tier1 customer relationship management (“CRM”) business (“Tier1”) and related assets from Tier1 Financial Solutions for approximately $ 32.5 million in cash, plus the costs of effecting the transaction.

Tier1 is a leading provider of sell-side CRM solutions targeting capital markets and investment banks.

Tier1 supplies CRM capabilities to sell-side financial services firms, including research, trading, and sales teams within capital markets groups, and provides deal management experience to investment banks.

The net assets and results of operations of Tier1 have been included in our Consolidated Financial Statements from August 23, 2022.

The preliminary fair value of the intangible assets, consisting of customer relationships and completed technology, was determined using the income approach.

Specifically, the relief-from-royalty method was utilized for completed technology, and the excess earnings method was utilized for customer relationships.

Customer relationships and completed technologies are expected to be amortized over approximately fourteen and six years, respectively, in each case the estimated life of the assets.

The remainder of the purchase price was allocated to goodwill and is tax deductible.

The Consolidated Statements of Comprehensive Income for the year ended December 31, 2022 includes $ 4.7 mi llion in revenues from Tier1’s operations.

2021 Acquisitions

On March 1, 2021 , we purchased all of the outstanding stock of Capita Life & Pensions Services (Ireland) Limited (“Capita”) and certain related businesses.

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The excess of fair values of the net assets over the purchase price was recorded as a gain on bargain purchase within other income, net on the Consolidated Statement of Comprehensive Income.

The Consolidated Statements of Comprehensive Income for the year ended December 31, 2021 includes $ 34.8 million in revenues from Capita’s operations.

2020 Acquisitions

On May 15, 2020 , we purchased all of the outstanding stock of Innovest Systems, Inc.

(“Innovest”) for approximately $ 99.1 million in cash, net of cash acquired, and 0.4 million shares of our common stock, plus the costs of effecting the transaction and the assumption of certain liabilities.

Innovest provides web-based technology systems for trust accounting and unique asset servicing.

Innovest's product InnoTrust offers solutions to support the accounting and reporting needs of trust companies, banks, private banks, retirement plan administrators and others.

The net assets and results of operations of Innovest have been included in our Consolidated Financial Statements from May 15, 2020.

The fair value of intangible assets, consisting of customer relationships, completed technology and trade names, was determined using the income approach.

Specifically, the relief-from-royalty method was utilized for the completed technology and trade names and the excess earnings method was utilized for the customer relationships.

The intangible assets are amortized each year based on the ratio that the projected cash flows for the intangible assets bear to the total of current and expected future cash flows for the intangible assets.

The customer relationships, trade names and completed technology are expected to be amortized over approximately 14, 13 and seven years , respectively, in each case the estimated lives of the assets.

The remainder of the purchase price was allocated to goodwill and is primarily tax deductible.

On March 24, 2020 , we purchased all of the outstanding stock of Captricity, Inc.

(“Captricity”) for approximately $ 15.1 million in cash, net of cash acquired, plus the costs of effecting the transaction and the assumption of certain liabilities.

Captricity’s data transformation platform, Vidado, provides an enterprise-grade cloud-based machine learning solution that enables fast, scalable and highly accurate extraction of handwritten and machine-printed data from paper documents.

The net assets and results of operations of Captricity have been included in our Consolidated Financial Statements from March 24, 2020.

The fair value of intangible assets, consisting of customer relationships and completed technology, was determined using the income approach.

Specifically, the relief from-royalty method was utilized for the completed technology and the excess earnings method was utilized for the customer relationships.

The customer relationships and the completed technology are expected to be amortized over approximately 15 and seven years , respectively, in each case the estimated lives of the assets.

The fair value of deferred revenue was determined using the market approach.

The remainder of the purchase price was allocated to goodwill and is not tax deductible.

The following summarizes the preliminary allocation of the purchase price for the 2021 acquisition of Capita.

The amounts pending finalization include accrued liabilities and the evaluation of taxes.

The following also summarizes the final allocation of the purchase price for the 2020 acquisitions of Innovest and Captricity (in millions):

The following summarizes the allocation of the purchase price for the 2022 acquisitions of Blue Prism, Hubwise and Tier1 and the 2021 acquisition of Capita (in millions):

Accounts receivable

Acquired client relationships and contracts

Completed technology

Property, plant and equipment

Operating lease right-of-use assets

Customer relationships

Completed technologies

Accounts payable

Accrued employee compensation and benefits

Accrued employee compensation and other liabilities

Deferred revenue

Other liabilities assumed

Deferred income taxes

Gain on bargain purchase

Consideration paid, net of cash acquired

Additionally, we acquired Millennium Consulting Services in December 2020 for approximately $ 2.7 million.

Additionally, we acquired 5 M’s Minerals Management, LLC (“MineralWare”) in May 2022 for approximately $ 18.0 million and Complete Financial Ops, Inc.

(“CFO”) in December 2022 for approximately $ 5.7 million.

We acquired assets related to O’Shares exchange traded funds (“O’Shares”) in June 2022 for approximately $ 28.3 million.

The goodwill associated with each of the transactions above is a result of expected synergies from combining the operations of businesses acquired with us and intangible assets that do not qualify for separate recognition, such as an assembled workforce.

We recorded severance expense related to personnel reductions in connection with the continued integration efforts associated with the acquisitions of DST, Eze, Intralinks and Algorithmics.

The following unaudited pro forma condensed consolidated results of operations are provided for illustrative purposes only and assume that the acquisitions of Blue Prism, Hubwise, MineralWare, Tier1 and CFO occurred on January 1, 2021 and the acquisition of Capita occurred on January 1, 2020, after giving effect to certain adjustments, including amortization of intangibles, interest, transaction costs and tax effects.

This unaudited pro forma information (in millions) should not be relied upon as being indicative of the historical results that would have been obtained if the acquisitions had actually occurred on those dates, nor of the results that may be obtained in the future.

Year Ended December 31,

We recorded severance expense related to personnel reductions in several of our financial services and healthcare businesses.

The amount of severance expense recognized in our Consolidated Statements of Comprehensive Income was as follows (in millions):

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Total severance expense

The following unaudited pro forma condensed consolidated results of operations are provided for illustrative purposes only and assume that the acquisition of Capita occurred on January 1, 2020 and the acquisitions of Innovest and Captricity occurred on January

1, 2019, after giving effect to certain adjustments, including amortization of intangibles, interest, transaction costs and tax effects.

Year Ended December 31,

Note 9—Goodwill and Intangible Assets

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Balance at December 31, 2020

2020 acquisitions

Adjustments to prior acquisitions

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Balance at December 31, 2021

Acquisitions completed in the current year

Adjustments to prior acquisitions

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A summary of the components of intangible assets is as follows (in millions):

Accumulated Amortization

Customer relationships

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Total intangible assets

accumulated amortization

Total intangible assets, net

Total estimated amortization expense, related to intangible assets, for each of the next five years and thereafter, as of December 31, 2022, is expected to approximate (in millions):

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Long-term debt

The table below provides a summary of the key terms of our Senior Secured Credit Facilities and Senior Notes:

Amount Outstanding

at December 31, 2022

Scheduled Quarterly

(in millions)

Payments Required

Senior Secured Credit Facilities

Term Loan B-3

April 16, 2025

Variable rate (1)

Term Loan B-4

April 16, 2025

Variable rate (1)

Term Loan B-5

April 16, 2025

Variable rate (1)

Term Loan B-6

March 22, 2029

Variable rate (2)

Term Loan B-7

March 22, 2029

Variable rate (2)

Revolving Credit Facility

December 28, 2027

Variable rate (3)

September 30, 2027

Fixed at 5.5 %

(1) Initially incurred interest at either LIBOR plus 2.50 % of at the base rate plus 1.50 %, and were subject to a step-down at any time our consolidated net secured leverage ratio was less than 4.75 times, to 2.25 % in the case of the LIBOR margin and 1.25 % in the case of the base rate margin.

In January 2020, we entered into a pricing amendment, whereby the interest rate margin applicable to the term loans was reduced from LIBOR plus 2.25 % to LIBOR plus 1.75 %.

(2) Bears interest at, at our option, either (a) the Base Rate, plus 1.25 % per annum or the (b) Term Secured Overnight Financing Rate (“SOFR ”), which is subject to a floor of 0.50 %, plus a credit spread adjustment set forth in the Credit Agreement, plus 2.25 % per annum.

(3) Bears interest at, at our option, the Base Rate per annum or the Term SOFR.

Loans based on the Base Rate bear interest at a rate between the Base Rate plus 0.25 % or 0.50 %, depending on our consolidated secured net leverage ratio.

Loans based on Term SOFR bear interest at a rate between Term SOFR plus 1.25 % and Term SOFR plus 1.50 %, depending on our consolidated secured net leverage ratio.

Senior Secured Credit Facilities

On April 16, 2018 , in connection with our acquisition of DST, we entered into an amended and restated credit agreement with SS&C Technologies, Inc.

(“SS&C”), SS&C European Holdings SARL, an indirect wholly-owned subsidiary of SS&C (“SS&C SARL”) and SS&C Technologies Holdings Europe SARL, an indirect wholly-owned subsidiary of SS&C (“SS&C Tech SARL”) as the borrowers (“Credit Agreement”).

The Credit Agreement includes four tranches of term loans (together the “Initial Term Loans”):

(i) a $ 518.6 million term B-1 facility for SS&C (“Term B-1 Loan”), which was repaid in full in 2019 ;

(ii) a $ 5.9 million term B-2 facility for SS&C SARL (“Term B-2 Loan”), which was repaid in full in 2018 ;

(iii) a $ 5.046 billion term B-3 facility, which matures on April 16, 2025 for SS&C (“Term B-3 Loan”);

and (iv) a $ 1.8 billion term B-4 facility, which matures on April 16, 2025 for SS&C SARL (“Term B-4 Loan”).

In addition, the Credit Agreement has a revolving credit facility with a five-year term available for borrowings by SS&C with $ 250.0 million in available commitments (“Revolving Credit Facility”), of which $ 247.3 million was available as of December 31, 2021 .

The Revolving Credit Facility also contains a $ 25 million letter of credit sub-facility, of which $ 2.7 million was utilized as of December 31, 2021.

The majority of the initial proceeds from the Initial Term Loans was used to satisfy the consideration required to fund the acquisition of DST, repay certain amounts outstanding under our then-existing credit agreement (“Prior Credit Agreement”), repay all of the outstanding principal amount of our 5.875 % Senior Notes due 2023 (“Prior Senior Notes”) and to repay acquired debt associated with DST.

On October 1, 2018, in connection with our acquisition of Eze, we entered into an amendment (the “Commitment Increase Amendment”) to the Credit Agreement.

Pursuant to the Commitment Increase Amendment, a new $ 875.0 million senior secured term B-5 facility (“Term B-5 Loan”, and together with the Initial Term Loans, the “Term Loans”) was made available to us, the proceeds of which were used to finance, in part, the Eze acquisition.

On November 16, 2018, in connection with our acquisition of Intralinks, we entered into an amendment (the “Incremental Term Loan Amendment”) to the Credit Agreement.

Pursuant to the Incremental Term Loan Amendment, an additional $ 1.0 billion senior secured term B-5 facility (“Term B-5 Loan”, and together with the Initial Term Loans, the “Term Loans”) was made available to us, the proceeds of which were used to finance, in part, the Intralinks acquisition.

On January 31, 2020, we entered into an amendment (the “Pricing Amendment”) to our Credit Agreement dated April 16, 2018.

Pursuant to the Pricing Amendment, the interest rate margin applicable to Term Loan B was reduced from LIBOR plus 2.25 % to LIBOR plus 1.75 %.

No changes were made to the financial covenants, outstanding principal amounts or the scheduled amortization.

The Pricing Amendment was evaluated in accordance with FASB ASC 470-50, Debt-Modifications and Extinguishments , for modification and extinguishment accounting.

We accounted for the debt re-pricing as a debt modification with respect to amounts that remained obligations of the same lender in the syndicate with minor changes in cash flows and as a debt extinguishment with respect to amounts that were obligations of lenders that exited the syndicate or remained in the syndicate but experienced a change in cash flows of greater than 10 %.

The Term Loans and Revolving Credit Facility bear interest, at the election of the borrowers, at the base rate (as defined in the Credit Agreement) or LIBOR, plus the applicable interest rate margin for the credit facility.

Amounts drawn on the Revolving Credit Facility initially bear interest at either LIBOR plus 2.25 % or at the base rate plus 1.25 %, and is subject to a step-down at any time our consolidated net secured leverage ratio is less than 4.75 times, to 2.00 % in the case of the LIBOR margin and 1.00 % in the case of the base rate margin.

The Term B-3 Loan, Term B-4 Loan and Term B-5 Loan initially incurred interest at either LIBOR plus 2.50 % or at the base rate plus 1.50 %, and were subject to a step-down at any time our consolidated net secured leverage ratio was less than 4.75 times, to 2.25 % in the case of the LIBOR margin and 1.25 % in the case of the base rate margin.

In January 2020, we entered into the Pricing Amendment, whereby the interest rate margin applicable to the term loans was reduced from LIBOR plus 2.25 % to LIBOR plus 1.75 %.

As of December 31, 2021 , there was $ 1,244.3 million in principal amount outstanding under the Term B-3 Loan, $ 1,010.0 million in principal amount outstanding under the Term B-4 Loan and $ 1,720.2 million in principal amount outstanding under the Term B-5 Loan.

There were no principal amounts outstanding under the Term B-1 Loan and Term B-2 Loan.

SS&C and SS&C SARL are required to make scheduled quarterly payments of 0.25 % of the original principal amount of the Term B-3 Loan, Term B-4 Loan and Term B-5 Loan, with the balance due and payable on April 16, 2025.

No amortization is required under the Revolving Credit Facility.

Also in 2018, we entered into amendments to the Credit Agreement in connection with our acquisitions of Eze and Intralinks, the Term B-5 Loan.

On March 22, 2022, in connection with our acquisition of Blue Prism, we entered into an Incremental Joinder to the Credit Agreement with certain of our subsidiaries.

Pursuant to the Incremental Joinder, a new $ 650.0 million senior secured incremental term loan B facility (“Term B-6 Loan”) and a new $ 880.0 million senior secured incremental term loan B facility (“Term B-7 Loan”

and together with the Term B-6 Loan, the “Incremental Term Loans”) was made available to us, the proceeds of which were used to finance substantially all of the consideration for the acquisition of Blue Prism.

The Credit Agreement had a revolving credit facility with a five-year term available for borrowings by SS&C with $ 250.0 million in available commitments (“Revolving Credit Facility”).

The Revolving Credit Facility also contained a $ 25 million letter of credit sub-facility.

On December 28, 2022, we entered into an amendment (the “Revolving Facility Amendment”) to the Credit Agreement with certain of our subsidiaries.

Pursuant to the Revolving Facility Amendment, the Revolving Credit Facility was amended to:

(i) extend the maturity date to December 28, 2027, (ii) amend the interest rate provisions to replace LIBOR with Term SOFR as the interest rate benchmark, (iii) increase the aggregate commitments from $ 250.0 million to $ 600.0 million, (iv) increase the letter of credit sub-facility from $ 25.0 million to $ 75.0 million and (v) make certain other revisions fully set forth in the Revolving Facility Amendment.

As of December 31, 2022, there was $ 2.5 million utilized of the letter of credit sub-facility and $ 597.5 million available of the Revolving Facility Amendment.

SS&C’s and SS&C SARL’s obligations under the Term Loans are guaranteed by (i) our existing and future U.S.

wholly-owned restricted subsidiaries, in the case of the Term B-3 Loan, Term B-5 Loan and the Revolving Credit Facility and (ii) our existing and future wholly-owned restricted subsidiaries, in the case of the Term B-4 Loan.

wholly-owned restricted subsidiaries, in the case of the Term B-3 Loan, Term B-5 Loan, Term B-6 Loan and the Revolving Credit Facility and (ii) our existing and future wholly-owned restricted subsidiaries, in the case of the Term B-4 Loan and Term B-7 Loan.

The obligations of the U.S.

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Interest on the Senior Notes is payable on March 30 and September 30 of each year.

At any time prior to March 30, 2022, we may, at our option, redeem the Senior Notes, in whole or in part, at a price equal to 100 % of the principal amount of the Senior Notes, plus an applicable “make-whole”

premium, plus accrued and unpaid interest to the redemption date.

In addition, at any time on or before March 30, 2022, we may to redeem up to 40 % of the aggregate principal amount of the Senior Notes at a redemption price equal to 105.5 % of the principal amount thereof, plus accrued and unpaid interest to the redemption date, with the net proceeds of one or more equity offerings.

We may also, from time to time in our sole discretion, purchase, redeem, or retire our existing senior notes, through tender offers, in privately negotiated or open market transactions, or otherwise.

At any time on or after March 30, 2022, we may redeem some or all of the Senior Notes, in whole or in part, at the redemption prices set forth in the following table, expressed as a percentage of the principal amount, plus accrued and unpaid interest to the redemption date:

Redemption Year

2025 and thereafter

The indenture governing the Senior Notes contains a number of covenants that restrict, subject to certain thresholds and exceptions, our ability and the ability of our domestic restricted subsidiaries to incur debt or liens, make certain investments, pay dividends, dispose of certain assets, or enter into transactions with its affiliates.

Redemption Date

On or after March 30, 2022

On or after March 30, 2023

On or after March 30, 2024

March 30, 2025 and thereafter

We may also, from time to time in our sole discretion, purchase, redeem, or retire our existing senior notes, through tender offers, in privately negotiated or open market transactions, or otherwise.

dividends, dispose of certain assets, or enter into transactions with its affiliates.

Any event of default under the Credit Agreement that leads to an acceleration of those amounts due also results in a default under the indenture governing the Senior Notes.

As of December 31, 2021 , there was $ 2.0 billion in principal amount of Senior Notes outstanding.

Debt Issuance Costs and Loss on Extinguishment of Debt

We capitalized an aggregate of $ 37.7 million and $ 3.0 million in financing costs during the twelve months ended December 31, 2022 in connection with the Incremental Joinder and Revolving Facility Amendment, respectively .

We made additional principal payments prior to their scheduled maturity in 2022, 2021 and 2020, which resulted in a loss on extinguishment of debt of $ 5.5 million, $ 10.9 million and $ 2.2 million, respectively, due to the write-off of a portion of the unamortized capitalized financing fees and the unamortized original issue discount.

We accounted for the Pricing Amendment as a debt modification with respect to amounts that were obligations of lenders that exited the syndicate or remained in the syndicate but experienced a change in cash flows of greater than 10 % in accordance with FASB Accounting Standards Codification 470-50, Debt-Modifications and Extinguishments , which resulted in $ 2.8 million loss on extinguishment of debt in 2020.

The loss on extinguishment of debt includes the write-off of a portion of the unamortized capitalized financing fees related to our Credit Agreement for amounts accounted for as a debt extinguishment, as well as new financing fees for amounts accounted for as a debt modification.

During 2020, we purchased $ 184.8 million principal amount of our Term Loans in privately negotiated transactions, which resulted in a gain on extinguishment of debt of $ 0.8 million.

We made additional principal payments prior to their scheduled maturity in 2021 and 2020, which resulted in a loss on extinguishment of debt of $ 10.9 million and $ 2.2 million, respectively, due to the write-off of a portion of the unamortized capitalized financing fees and the unamortized original issue discount.

We capitalized an aggregate of $ 6.1 million in financing costs in connection with the issuance of our Senior Notes and repayment of a portion of our Term B-3 Loan in 2019, in accordance with FASB Accounting Standards Codification 470-50, Debt-Modifications and Extinguishments .

We accounted for the refinancing as a debt modification with respect to amounts that remained obligations of the same lender with minor changes in cash flows and as a debt extinguishment with respect to amounts that were obligations of lenders which remained but experienced a change in cash flows of greater than 10 %.

Other costs of $ 7.1 million, incurred in connection with the issuance of the Senior Notes, which did not meet the criteria for capitalization, are included in loss on extinguishment of debt in the Consolidated Statements of Comprehensive Income during 2019.

Fair Value of Debt

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In May 2020, we used 0.4 million shares from treasury stock in connection with our acquisition of Innovest.

In 2021 , we paid a quarterly cash dividend of $ 0.16 per share of common stock in March, June and September and $ 0.20 per share of common stock in December, totaling $ 174.0 million.

In 2020 , we paid a quarterly cash dividend of $ 0.125 per share of common stock in March and June and $ 0.14 per share of common stock in September and December, totaling $ 136.1 million.

In 2022 , we paid a quarterly cash dividend of $ 0.20 per share of common stock in March, June, September and December, totaling $ 203.1 million.

In 2021 , we paid a quarterly cash dividend of $ 0.16 per share of common stock in March, June and September and $ 0.20 per share of common stock in December, totaling $ 174.0 million.

In 2020, we paid a quarterly cash dividend of

$ 0.125 per share of common stock in March and June and $ 0.14 per share of common stock in September and December, totaling $ 136.1 million .

Stock Repurchase Program

In August 2019, our Board of Directors authorized the repurchase of up to $ 500 million of our common stock on the open market or in privately negotiated transactions.

In July 2020, our Board of Directors authorized the renewal and increase of our stock repurchase program, which enabled us to repurchase up to $ 750 million in the aggregate of our outstanding common stock.

In July 2021, our Board of Directors authorized a stock repurchase program, which enables us to repurchase up to $ 1 billion in the aggregate of our outstanding common stock.

In July 2021, our Board of Directors authorized a stock repurchase program which enabled us to repurchase up to $ 1 billion in the aggregate of our outstanding common stock.

In July 2022, our Board of Directors authorized a stock repurchase program which enables us to repurchase up to $ 1 billion in the aggregate of our common stock.

Our authority to repurchase shares under the program will continue until the one-year anniversary of the Board’s authorization, unless earlier terminated by the Board.

During 2022, 2021 and 2020 , we repurchased 7.8 million, 6.8 million and 3.7 million shares of common stock for approximately $ 476.1 million, $ 487.9 million and $ 227.7 million, respectively.

Other Comprehensive (Loss) Income

Other Comprehensive Loss

Accumulated other comprehensive loss (income) balances, net of tax consist of the following (in millions):

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Balance, December 31, 2020

Net current period other comprehensive (loss) income

Net current period other comprehensive income (loss)

Balance, December 31, 2021

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Interest Rate Swap

Unrealized gain (loss) on interest rate swaps

Reclassification of losses into net earnings on interest rate swaps

Unrealized gains (losses) on interest rate swaps

Reclassification of (gains) losses into net earnings on interest rate swaps

Net change in cash flow hedges

Defined Benefit Pension

Unrealized net gains (losses) on defined benefit pension plan

Net change in defined benefit pension

Unrealized net (losses) gains on defined benefit pension plan

Foreign Currency Translation

Current period translation adjustments

Net cumulative translation adjustments

Total other comprehensive (loss) income

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Accordingly, we determined that we are the primary beneficiary of DomaniRx and consolidate its results.

As of formation, DomaniRx held net assets of $ 288.8 million, comprised of cash and cash equivalents of $ 138.3 million, of which we contributed $ 71.0 million, and intangible assets of $ 150.5 million, of which we contributed $ 113.8 million based on our historical cost basis, in our Consolidated Balance Sheets.

There were no liabilities related to DomaniRx in the Consolidated Balance Sheets as of formation.

Upon the initial formation and consolidation of DomaniRx in July 2021, we recorded a $ 57.2 million noncontrolling interest.

The carrying value of the assets and liabilities associated with DomaniRx included in the Consolidated Balance Sheets as of December 31, 2021, which are limited for use in its operations and do not have recourse against our general credit or our senior secured credit facilities, are as follows:

The carrying value of the assets and liabilities associated with DomaniRx included in the Consolidated Balance Sheets as of December 31, 2022 and 2021, which are limited for use in its operations and do not have recourse against our general credit or our senior secured credit facilities, are as follows:

Cash and cash equivalents

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Deferred revenues are recorded on a net basis with contract assets at the contract level.

Accordingly, as of December 31, 2021 and 2020, approxim ately $ 61.0 mil lion and $ 53.9 million, respectively, of deferred revenue is presented net within contract assets arising from the same contracts.

The amount of revenues recognized in the period that was included in the opening deferred revenues balance w as $ 273.8 mill ion, $ 289.7 million and $ 204.3 million for the years ended December 31, 2021, 2020 and 2019, respectively.

Accordingly, as of December 31, 2022 and 2021, approxim ately $ 68.0 mil lion and $ 61.0 million, respectively, of deferred revenue is presented net within contract assets arising from the same co ntracts.

The amount of revenues recognized in the period that was included in the opening deferred revenues balance was $ 262.9 mill ion, $ 273.8 million and $ 289.7 million for the years ended December 31, 2022, 2021 and 2020, respectively.

As of December 31, 2022 , revenue of approximately $ 1,000.3 million is expected to be recognized from remaining performance obligations for license, maintenance and related revenues, of which $ 484.8 million is e xpected to be recognized over the next twelve months.

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Note 14—Stock-based Compensation

In March 2019, our Board of Directors adopted the Second Amended and Restated 2014 Stock Incentive Plan, which amends and restates our Amended and Restated 2014 Stock Incentive Plan (the “Amended 2014 Plan”) (together with the Amended 2014 Plan, the “2014 Plans”), which became effective in May 2019 upon stockholder approval.

The Second Amended and Restated 2014 Stock Incentive Plan was adopted to increase the shares available for equity awards by an additional 34.0 million shares.

In February 2016, our Board of Directors adopted the Amended 2014 Plan, which became effective in May 2016 upon stockholder approval and which amended and restated our 2014 Stock Option Plan.

In March 2019, our Board of Directors adopted the Second Amended and Restated 2014 Stock Incentive Plan, which amended and restated our Amended and Restated 2014 Stock Incentive Plan (the “Amended 2014 Plan”) (together with the Amended 2014 Plan, the “2014 Plans”), which became effective in May 2019 upon stockholder approval.

The 2014 Stock Option Plan authorized stock options to be granted for up to 6.0 million shares of our common stock.

The Amended 2014 Plan was adopted with an initial share capacity of 24.0 million shares available for the grant of awards.

The Amended 2014 Plan authorizes the issuance of equity awards, including stock options, restricted stock awards (“RSAs”) and restricted stock units (“RSUs”) and allows the class of participants to include non-employee directors.

Since the adoption of the Amended 2014 Plan, we have not made any grants of equity or equity-based awards under the 2008 Stock Incentive Plan or the 2006 Equity Incentive Plan.

The 2014 Stock Option Plan authorizes stock options to be granted for up to 6.0 million shares of our common stock.

We have granted time-based stock options under the 2014 Stock Option Plan.

In April 2008, our Board of Directors adopted, and our stockholders approved, an equity-based incentive plan (“the 2008 Plan”), which authorizes equity awards to be granted for up to 21.8 million shares of our common stock.

We have granted time-based stock options and RSUs under the 2008 Plan.

In August 2006, our Board of Directors adopted an equity-based incentive plan (“the 2006 Plan”), which authorizes equity awards to be granted for up to 22.3 million shares of our common stock.

We have granted RSAs of our common stock and both time-based and performance-based stock options under the 2006 Plan.

Under the terms of the 2014 Plans, the 2008 Plan and 2006 Plan, the exercise price of awards is set on the grant date and may not be less than the fair market value per share on such date.

The Second Amended and Restated 2014 Stock Incentive Plan was adopted to increase the shares available for equity awards by an additional 34.0 million shares.

Under the terms of the 2014 Plans, the exercise price of awards is set on the grant date and may not be less than the fair market value per share on such date.

Generally, awards expire ten years from the date of grant.

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Restricted Stock Units

During the year ended December 31, 2022 , we granted RSUs which generally vest 33.3 % on the first anniversary of the grant and 1/4th of the remaining balance each six months thereafter for two years .

We did not grant any RSUs during the years ended December 31, 2021 and 2020.

At December 31, 2022, there was approximately $ 119.9 million of unearned non-cash stock-based compensation related to RSUs that we expect to recognize as expense over a remaining period of approximately 2.9 years.

At December 31, 2021 , there was no remaining unearned non-cash stock-based compensation related to RSUs.

At December 31, 2020 , there was approximately $ 0.8 million of unearned non-cash stock-based compensation related to RSUs.

Performance-based Stock Units

In July 2021, we granted performance-based stock units under the 2014 Plan at a grant date fair value of $ 75.03 per share.

In July 2021 and March 2022, we granted performance-based stock units at a grant date fair value of $ 75.03 per share and $ 71.89 per sh are, respectively.

These awards include established annual earnings per share growth targets and will measure performance against the target over the 2 -year performance period.

Performance is measured relative to a 2-year average annual growth rate that is established at the beginning of the cycle and held constant.

Participants will only be entitled to receive any portion of the PSUs that are earned if they remain employed through the final determination of the satisfaction of these performance goals through June 30, 2023.

The total number of units to be issued if we achieve the targeted growth rate during the measurement period is 0.4 million.

Participants will only be entitled to receive any portion of the PSUs that are earned if they remain employed through the final determination of the satisfaction of these performance goals.

The actual number of units that will be issued ranges from zero , if the threshold level of performance is not achieved, to 200 % of the targeted number of units, if the annual growth rate meets or exceeds a specified level.

At December 31, 2021 there was approximately $ 25.7 million of unearned non-cash stock-based compensation related to PSUs that we expect to recognize as expense over a remaining period of approximately 1.6 years.

As of December 31, 2022, the PSUs are not expected to vest.

During the year ended December 31, 2022, we recorded a true-up to reverse previously recorded stock-based compensation expense relating to the PSUs.

At December 31, 2021 there was approximately $ 25.7 million of unearned non-cash stock-based compensation related to PSUs that we expected to recognize as expense over a remaining period of approximately 1.6 years.

Time-based Stock Options and SARs

Time-based stock options and SARs granted under the 2006 Plan, the 2008 Plan and the 2014 Plans generally vest 25 % on the first anniversary of the grant date and 1/36 th of the remaining balance each month thereafter for 36 months.

Time-based stock options and SARs generally vest 25 % on the first anniversary of the grant date and 1/36 th of the remaining balance each month thereafter for 36 months.

All outstanding time-based stock options and SARs vest upon a change in control, subject to certain conditions.

Time-based stock options and SARs granted during 2021, 2020 and 2019 have a weighted-average grant date fair value of $ 22.28 , $ 18.06 and $ 14.85 per share, respectively, based on the Black-Scholes option pricing model.

Time-based stock options granted during 2022, 2021 and 2020 have a weighted-average grant date fair valu e of $ 15.26 , $ 22.28 and $ 18.06 per share, respectively, based on the Black-Scholes option pricing model.

Compensation expense is recorded on a straight-line basis over the requisite service period.

The fair value of time-based stock options and SARs vested during the years ended December 31, 2021, 2020 and 2019 was approximately $ 103.0 million, $ 81.1 million and $ 75.5 million, respectively.

At December 31, 2021 and 2020 , there was approximately $ 270.1 million and $ 302.7 million, respectively, of unearned non-cash stock-based compensation related to time-based stock options and SARs that we expect to recognize as expense over a weighted-average remaining period of approximately 2.8 years and 3.1 years, respectively.

The fair value of time-based stock options vested during the years ended December 31, 2022, 2021 and 2020 was appro ximately $ 102.1 million, $ 103.0 million and $ 81.1 million, respectively.

At December 31, 2022 and 2021, there was appr oximately $ 201.6 millio n and $ 270.1 million, respectively, of unearned non-cash stock-based compensation related to time-based stock options that we expect to recognize as expense over a weighted-average remaining period of approxim ately 2.7 years and 2 .8 years, respectively.

Performance-based Stock Options

In March and December 2021, we granted performance-based stock options (“PSOs”) under the 2014 Plan.

In March and December 2021, we granted performance-based stock options (“PSOs”).

These awards include established annual earnings per share growth targets and will measure performance against the target over the 3 -year performance period.

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Participants will only be entitled to receive any portion of the PSOs that are earned if they remain employed through the final determination of the satisfaction of these performance goals.

The actual number of units that will be issued ranges from zero , if the threshold level of performance is not achieved, to 200 % of the targeted number of options, if the annual growth rate meets or exceeds a specified level.

The actual number of options that will be issued ranges from zero , if the threshold level of performance is not achieved, to 200 % of the targeted number of options, if the annual growth rate meets or exceeds

a specified level.

PSOs granted during 2021 have a weighted-average grant date fair value of $ 21.88 per share, based on the Black-Scholes options pricing model.

During the year ended December 31, 2021, no PSOs have vested.

At December 31, 2021, there was approxima tely $ 103.2 mi llion of unearned non-cash stock-based compensation related to PSOs that we expect to recognize as expense over a remaining period of appro ximately 3.1 years.

For the stock-options and SARs valued using the Black-Scholes option-pricing model, we used the following weighted-average assumptions:

Time-based stock options and SARs

During the year ended December 31, 2022 and 2021, no PSOs have vested.

At December 31, 2022 and 2021, there was approxima tely $ 60.8 million and $ 103.2 mi llion, respectively of unearned non-cash stock-based compensation related to PSOs that we expect to recognize as expense over a remaining period of approximately 2.1 years and 3.1 years, respectively.

For the stock-options valued using the Black-Scholes option-pricing model, we used the following weighted-average assumptions:

Time-based stock options

Expected term to exercise (years)

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Expected dividend yield

Total Stock Options, SARs, RSUs and PSUs

Total Stock Options, RSUs and PSUs

The amount of stock-based compensation expense recognized in our Consolidated Statements of Comprehensive Income for the years ended December 31, 2022, 2021 and 2020 was as follows (in millions):

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Stock Options and SARs

RSUs and PSUs

PSUs and RSUs

Weighted-Average Exercise Price

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Outstanding at December 31, 2022

In addition to the amounts reflected in the table above, an additional 4.5 million stock options and 0.3 million stock units may be granted if all performance award criteria is achieved at the maximum level.

The following table summarizes information about vested stock options and SARs outstanding that are currently exercisable and stock options and SARs outstanding that are expected to vest at December 31, 2021:

The following table summarizes information about vested stock options and SARs outstanding that are currently exercisable and stock options and SARs outstanding that are exercisable and expected to vest at December 31, 2022:

Outstanding, Vested Stock Options and SARs Currently Exercisable

Outstanding Stock Options and SARs Expected to Vest

Outstanding Stock Options and SARs Exercisable and Expected to Vest

(In millions)

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Note 15—Benefit Plans

We sponsor defined contribution plans that cover our domestic and international employees following the completion of an eligibility period.

We sponsor defined contribution plans that cover our domestic and international employees.

During the years ended December 31, 2022, 2021 and 2020, we incurred $ 111.7 m illion, $ 99.2 million and $ 92.0 million, respectively, of employer contribution expenses under these plans.

Additionally, we sponsor a defined benefit pension plan, which has total assets of $ 16.4 million and a net asset of $ 2.5 million as of December 31, 2022 .

The defined benefit pension plan we sponsor had total assets of $ 25.1 million and a net liability of $ 1.2 million as of December 31, 2020.

The defined benefit pension plan we sponsor had total assets of $ 26.3 million and a net asset of $ 2.6 million as of December 31, 2021.

Note 16—Basic and Diluted Earnings per Share

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Common equivalent shares consist of stock options, SARs, RSUs and PSUs using the treasury stock method.

Common equivalent shares are excluded from the computation of diluted earnings per share if the effect of

including such common equivalent shares would be anti-dilutive because their total assumed proceeds exceed the average fair value of common stock for the period.

Common equivalent shares are excluded from the computation of diluted earnings per share if the effect of including such common equivalent shares would be anti-dilutive because their total assumed proceeds exceed the average fair value of

common stock for the period.

We have two classes of common stock, each with identical participation rights to earnings and liquidation preferences, and therefore the calculation of EPS as described above is identical to the calculation under the two-class method.

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We have recorded valuation allowances of $ 67.0 million at December 31, 2022 related primarily to certain foreign and state net operating loss carryforwards, tax credit carryforwards and

disallowed interest expense carryforwards, and $ 31.8 million at December 31, 2020 related primarily to certain foreign and state net operating loss carryforwards and tax credit carryforwards.

Of the $ 40.7 million valuation allowance recorded at December 31, 2021 , $ 6.9 million relates to foreign net operating losses that do not expire.

disallowed interest expense carryforwards, and $ 40.7 million at December 31, 2021 related primarily to certain foreign and state net operating loss carryforwards, tax credit carryforwards and disallowed interest expense carryforwards.

Of the $ 67.0 million valuation allowance recorded at December 31, 2022 , $ 45.7 million relates to foreign attribute carryforwards that do not expire.

The following table summarizes the activity related to our unrecognized tax benefits for the years ended December 31, 2022 and 2021 (in millions):

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Increases related to current year tax positions

Decreases related to prior tax positions

Increases related to prior tax positions

Lapse in statute of limitation

Foreign exchange translation adjustment

Balance at December 31, 2021

Increases related to current year tax positions

Increases related to prior tax positions

Decreases related to prior tax positions

Lapse in statute of limitation

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Balance at December 31, 2022

We accrued potential penalties and interest on the unrecognized tax benefits of $ 3.4 million and $ 0.3 million during 2021 and 2020 , respectively, and have recorded a total liability for potential penalties and interest, including penalties and interest related to unrecognized tax benefits, of $ 32.8 million and $ 29.9 million at December 31, 2021 and 2020, respectively.

We recorded a net benefit of $ 3.7 million and accrued $ 3.4 million for potential penalties and interest on the unrecognized tax benefits during 2022 and 2021 , respectively, and have recorded a total liability for potential penalties and interest, including penalties and interest related to unrecognized tax benefits, of $ 28.4 million and $ 32.8 million at December 31, 2022 and 2021, respectively.

Our unrecognized tax benefits decreased from 2021 to 2022 due to a lapse in the statute of limitations for certain domestic and foreign tax filings and decreases in prior year tax positions, offset partially by an increase in current year tax positions.

Our unrecognized tax benefits increased from 2020 to 2021 due to increases in current and prior year tax positions, offset partially by a decrease due to a lapse in the statute of limitations for certain domestic filings.

Our unrecognized tax benefits decreased from 2019 to 2020 due to a lapse in the statute of limitations for certain domestic tax filings, settlements with state tax authorities and decreases in prior year tax positions, offset partially by an increase in current year tax positions.

Our unrecognized tax benefits as of December 31, 2022 relate to domestic and foreign taxing jurisdictions and are recorded in other long-term liabilities on our Consolidated Balance Sheet at December 31, 2022.

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federal income tax returns are currently under audit for the tax periods ended December 31, 2017 through December 31, 2019 .

Our India income tax returns are currently under audit or in appeals for tax periods ending March 31, 2013, March 31, 2014, March 31, 2016, March 31, 2017, March 31, 2018, and March 31, 2019 .

Our California income tax returns are currently under audit or in appeals for the tax periods ended December 31, 2007 through 2016, December 31, 2018, and December 31, 2019 .

Our India income tax returns are currently under audit or in appeals for tax periods ending March 31, 2013, March 31, 2014, March 31, 2015, March 31, 2016, March 31, 2017, March 31, 2018, March 31, 2020 and March 31, 2021 .

Our California income tax returns are currently under audit or in appeals for the tax periods ended December 31, 2007 through 2019 .

Our New York income tax returns are currently under audit for the tax periods ended December 31, 2015 through 2018 .

Note 18—Commitments and Contingencies

Note 18—

Commitments and Contingencies

Purchase Obligations

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In our opinion, we are not involved in any litigation or proceedings that would have a material adverse effect on us or our business.

During the third quarter of 2021, in connection with the ongoing DST ERISA matters and associated legal proceedings described below, including the arbitration awards discussed below, we recorded an accrued liability and expense of $ 43.4 million to Other (expense) income, net on the Consolidated Statements of Comprehensive Income.

Due to the inherent uncertainties associated with the resolution of this litigation, including the arbitration matters, the ultimate resolution of and any additional potential exposure related to these matters is uncertain at this time.

In connection with recent legal proceedings related to the ongoing DST ERISA matters described below, including the arbitration awards, we have recorded an accrued liability of $ 51.5 million.

Of this amount, $ 8.1 million and $ 43.4 million were recorded in 2022 and 2021, respectively, to Other income (expense), net on the Consolidated Statements of Comprehensive Income.

Due to the inherent uncertainties associated with the resolution of these matters, the ultimate resolution of and any additional potential exposure related to these matters are uncertain at this time.

On September 1, 2017, a putative representative action was filed on behalf of the DST 401(k) Profit Sharing Plan (the “Plan”) in the United States District Court for the Southern District of New York, captioned Ferguson, et al v.

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On January 9, 2020, Ruane filed an amended answer to the amended complaint and asserted crossclaims for contribution and/or indemnification against DST.

Both DST and Ruane have filed answers denying the crossclaims asserted against them.

On March 8, 2021, the Court entered an order denying without prejudice the plaintiffs’

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Arbitration Claimants, and the Canfield Plaintiffs and Mendon Plaintiffs, each as defined below, filed petitions under Federal Rule of Civil Procedure 23(f) with the Second Circuit on August 30, 2021 and August 31, 2021, respectively, seeking interlocutory review of the Ferguson class certification order, which the Ferguson Plaintiffs and the DST Defendants opposed.

The Rule 23(f) petitions remain pending before the Second Circuit.

The Second Circuit denied the Rule 23(f) petitions on May 24, 2022 and May 25, 2022, respectively.

On February 4, 2022, the Ferguson Plaintiffs filed a third amended complaint, which included the class allegations.

On March 7, 2022, the DST Defendants and Ruane each filed answers to the Ferguson Plaintiffs’

third amended complaint and reasserted their respective cross-claims.

On August 23, 2021, the DST Defendants moved for a temporary restraining order and preliminary injunction against other proceedings, including the below-described arbitrations, which arise out of or relate to the allegations in Ferguson.

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On December 31, 2021, Arbitration Claimants moved by order to show cause for an immediate stay of the preliminary injunction pending their appeal to the Second Circuit.

On January 3, 2022, the Court denied Arbitration Claimants motion for an immediate stay and ordered the DST Defendants to show cause as to why the Court should not issue a stay of the preliminary injunction pending appeal.

The show-cause order was fully briefed on January 10, 2022.

On January 3, 2022, the Court denied Arbitration Claimants’

motion for an immediate stay and ordered the DST Defendants to show cause as to why the Court should not issue a stay of the preliminary injunction pending appeal.

On February 3, 2022, the Court denied Arbitration Claimants’

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In the same order, the Court held that it would determine the status of the arbitration awards already entered against DST at final judgment in the Ferguson action, either after trial or after settlement.

On February 4, 2022, Arbitration Claimants filed a motion in the Second Circuit to stay the preliminary injunction pending their appeal of the Court’s preliminary injunction, which the DST Defendants opposed on February 14, 2022.

On February 8, 2022, Arbitration Claimants noticed an appeal of the Court’s February 3, 2022 order.

On February 4, 2022, Arbitration Claimants filed a motion in the Second Circuit to stay the preliminary injunction pending their appeal of the Court’s preliminary injunction.

On June 7, 2022, the Second Circuit denied Arbitration Claimants’

motion to stay the preliminary injunction pending appeal.

On February 8, 2022, Arbitration Claimants and the Canfield Plaintiffs and Mendon Plaintiffs noticed an appeal of the Court’s February 3, 2022 order.

The February 8, 2022 appeal was consolidated with the December 15, 2021 appeal of the preliminary injunction.

On May 17, 2022, Arbitration Claimants and the Canfield Plaintiffs and Mendon Plaintiffs filed their opening brief in the consolidated appeals.

The DST Defendants filed their answering brief on September 15, 2022, and the reply was filed on October 20, 2022.

On January 30, 2023, the Second Circuit calendared oral argument for the appeal of the Court's preliminary injunction for April 20, 2023.

This appeal remains pending.

On July 10, 2020, the Ferguson Plaintiffs and the DST Defendants reached an agreement in principle to settle the class claims for $ 27 million, subject to the occurrence of certain conditions, including:

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On September 18, 2020, the parties submitted a letter to the Court disclosing that the Ferguson Plaintiffs and Ruane also had reached a settlement in principle, subject to Court approval.

The Ferguson Plaintiffs and the DST Defendants entered into a settlement agreement dated January 8, 2021 memorializing the terms of their proposed settlement, which was filed by the Ferguson Plaintiffs with the Court on the same date.

Plaintiffs and the DST Defendants entered into a settlement agreement dated January 8, 2021 memorializing the terms of their proposed settlement, which was filed by the Ferguson Plaintiffs with the Court on the same date.

On January 12, 2021, the Ferguson Plaintiffs moved for preliminary approval of the settlement with the DST Defendants, as well as preliminary approval of a separate settlement reached between the Ferguson Plaintiffs and Ruane.

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motion for preliminary approval of the settlement on the terms proposed.

On November 10, 2022, the Ferguson parties filed a notice of settlement and joint motion to stay the proceedings.

The notice informed the Court that the parties had reached a settlement in principle to settle the class claims (as discussed above, the class excludes certain plan fiduciaries), and the joint motion requested a stay while the parties sought to finalize their agreement and prepare an application for Court approval of the contemplated settlement.

On November 18, 2022, the Court entered an order staying the Ferguson action for 30 days.

On December 19, 2022, the Ferguson parties filed a joint motion to stay the proceedings for an additional 30 days, which the Court granted on January 9, 2023, staying the proceedings until February 8, 2023.

On February 8, 2023, the Ferguson parties filed a joint motion to stay the proceedings for an additional 45 days, which the Court granted on February 21, 2023, staying the proceedings until April 7, 2023.

On September 28, 2018, a complaint was filed in the United States District Court for the Southern District of New York captioned Robert Canfield, et al.

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On December 17, 2021, the Canfield Plaintiffs and Mendon Plaintiffs appealed the Court’s November 19, 2021 orders dismissing their respective actions to the Second Circuit.

That appeal remains pending.

On May 17, 2022, the Canfield Plaintiffs and Mendon Plaintiffs filed their opening briefs in those appeals.

The DST Defendants filed their answering briefs on September 15, 2022.

The Canfield Plaintiffs and Mendon Plaintiffs filed their reply briefs on October 20, 2022.

On January 30, 2023, the Second Circuit calendared oral argument for the appeals of the Court's dismissal of the Canfield and Mendon actions for April 20, 2023.

These appeals remain pending.

On October 8, 2019, a substantially similar action to the above-described Ferguson, Canfield, Mendon and below-described arbitration matters captioned Scalia v.

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Briefing on the motions to dismiss was completed on February 5, 2021.

All defendants’

motions to dismiss remain pending.

DST, the Advisory Committee of the Plan, and the Compensation Committee of DST’s Board of Directors have been named in 579 substantially similar individual demands for arbitration through January 27, 2021, by former and current DST employees demanding arbitration under the DST Employee Arbitration Program and Agreement (the “Arbitration Claimants”).

On March 28, 2022, the court denied Defendants’

motions to dismiss, and Martin J.

Walsh was substituted for Eugene Scalia as the plaintiff.

On April 11, 2022, the DST Defendants answered the DOL’s complaint.

DST, the Advisory Committee of the Plan, and the Compensation Committee of DST’s Board of Directors have been named in 579 substantially similar individual demands for arbitration to date, by former and current DST employees demanding arbitration under the DST Employee Arbitration Program and Agreement (the “Arbitration Claimants”).

The underlying claim in each is the same as in the above-described Ferguson matter, with the exception that the arbitrations purport to be brought as individual actions.

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Certain of the arbitration proceedings had been resolved in whole or in part by settlement.

Since November 24, 2021,

the AAA has administered only those arbitration proceedings associated with claimants who are not members of the Ferguson class, certain of which have resulted in awards against DST.

Between August 20, 2021 and November 17, 2021, counsel for Arbitration Claimants filed 177 motions to confirm certain of the arbitration awards.

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Between October 4 and December 22, 2021, the Western District of Missouri issued orders confirming those 177 arbitration awards and entering judgments against DST.

DST has appealed those judgments to the Eighth Circuit.

DST appealed those judgments to the Eighth Circuit.

On November 20, 2021, DST requested that the Eighth Circuit stay the pending appeals in light of the preliminary injunction entered in Ferguson.

On December 3, 2021, the Eighth Circuit ordered the parties to brief DST’s stay request.

On December 17, 2021, Arbitration Claimants and DST filed with the Eighth Circuit their respective briefs addressing the DST’s stay request.

On January 3, 2022, the Eighth Circuit declined to stay the briefing schedule on the pending appeals and consolidated those appeals.

DST’s opening brief in the Eighth Circuit is due March 24, and the Eighth Circuit has placed the matter on the court's oral argument calendar for the week of June 13-17, 2022.

On December 3, 2021, the Eighth Circuit ordered the parties to brief DST’s stay request, and on January 3, 2022, the Eighth Circuit declined to stay the briefing schedule on the pending appeals and consolidated those appeals.

DST filed its opening brief in the Eighth Circuit on March 24, 2022.

Arbitration Claimants filed their opposition brief on April 26, 2022, and DST filed its reply brief on May 18, 2022.

The Eighth Circuit heard oral argument on June 14, 2022.

On November 28, 2022, the Eighth Circuit vacated the judgments confirming the 177 arbitration awards and remanded those actions to the Western District of Missouri to determine whether the district court has subject-matter jurisdiction and whether the district court should transfer the cases to the Southern District of New York.

On December 14, 2022, the parties submitted simultaneous briefing to the Western District of Missouri regarding transfer.

On November 9, 2021, counsel for Arbitration Claimants filed in the Western District of Missouri a petition to compel arbitration captioned Addison v.

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(the “Addison Petition”) on behalf of 155 Arbitration Claimants, which DST opposed.

On February 14, 2022, the Western District of Missouri stayed the Addison Petition pending resolution of DST's appeals of the confirmation of the 166 arbitration awards to the Eighth Circuit.

On September 15, 2022, the Western District of Missouri dismissed the Addison Petition without prejudice, subject to that action being reopened after the Eighth Circuit’s rulings on DST’s appeals of the 177 orders confirming arbitration awards.

We continue to vigorously defend these matters.

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On May 24, 2021, Defendant Robert Goldfarb filed an answer to the complaint.

On September 17, 2021, the remaining

defendants filed a pre-motion letter requesting permission to file a motion to dismiss the complaint.

On September 22, 2021, the DST plaintiffs responded to the remaining defendants’

pre-motion letter.

On November 5, 2021, the Court denied the remaining defendants’

request for a pre-motion conference and granted the remaining defendants leave to file a motion to dismiss.

On December 17, 2021, the remaining defendants filed a motion to dismiss the DST plaintiffs’

The DST plaintiffs’

opposition brief is due on March 11, 2022, and the motion is scheduled to be fully briefed by April 1, 2022.

On July 27, 2022, the Court denied without prejudice the pending motion to dismiss, and ordered the parties to submit by October 3, 2022 a joint status report with a new briefing schedule on the motion.

On October 3, 2022, the parties filed a joint status report with a new briefing schedule on the motion, which the court approved on October 4, 2022.

On December 16, 2022, and January 13, 2023, the parties filed joint motions to stay the proceedings, which were granted on January 31, 2023, staying proceedings until February 8, 2023.

On February 8, 2023, the parties filed a joint motion to stay the proceedings for an additional 45 days.

This motion remains pending.

Note 19—Segment and Geographic Information

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On February 13, 2023 , our Board of Directors declared a quarterly cash dividend of $ 0.20 per share of common stock payable on March 15, 2023 to stockholders of record as of the close of business on March 1, 2023 .

Pending Acquisition

On December 1, 2021, we issued an announcement disclosing that our Board of Directors along with the Board of Directors of Blue Prism Group plc (“Blue Prism”

) had reached an agreement on the terms of our recommended acquisition of Blue Prism.

Under the terms of the acquisition, we will acquire Blue Prism for a value of approximately $ 1.7 billion.

The closing, which is expected to occur in the first or second quarter of 2022, remains subject to a number of conditions.

We plan to fund the acquisition with a combination of cash on hand and debt.

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 8. Financial Statements and Supplementary Data