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Item 8. Financial Statements and Supplementary Data

2023-02-24 compared with 2022-03-29 · 840 added, 951 removed, 973 unchanged (65% of the section changed)

Financial Statements

TPG Partners, LLC

Report of Independent Registered Public Accounting Firm (PCAOB ID No.

Balance Sheet as of December 31, 2021

Statement of Loss for the period from August 18, 2021 (Inception) to December 31, 2021

Statement of Member’s Interest for the period from August 18, 2021 (Inception) to December 31, 2021

Statement of Cash Flows for the period from August 18, 2021 (Inception) to December 31, 2021

Notes to Financial Statements

TPG Group Holdings (SBS), L.P.

Report of Independent Registered Public Accounting Firm (PCAOB ID No.

Consolidated Statements of Financial Condition as of December 31, 202 2 and 202 1

Consolidated Statements of Operations for the Years Ended Dece mber 31, 2021, 2020 and 2019

Consolidated Statements of Changes in Partners’ Capital for the Years Ended December 31, 2021, 2020 and 2019

Consolidated Statements of Operations for the Years Ended December 31, 202 2 , 202 1 and 20 2 0

Consolidated Statements of Changes in Equity for the Years Ended December 31, 202 2 , 202 1 and 20 2 0

Consolidated Statements of Cash Flows for the Years Ended December 31, 202 2 , 202 1 and 20 2 0

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Report of Independent Registered Public Accounting Firm

To the Managing Member of TPG Partners, LLC.

Opinion on the Financial Statement

We have audited the accompanying balance sheet of TPG Partners, LLC (the "Company") as of December 31, 2021, the related statement of loss, member’s interest, and cash flows, for the period from August 18, 2021 (inception) to December 31, 2021, and the related notes (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021, and the results of its operations and its cash flows for the period from August 18, 2021 (inception) to December 31, 2021, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Company's management.

Our responsibility is to express an opinion on the Company’s financial statements based on our audit.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audit, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audit of the financial statements provides a reasonable basis for our opinion.

Critical Audit Matters

Critical audit matters are matters arising from the current-period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

We determined that there are no critical audit matters.

/s/ DELOITTE & TOUCHE LLP

Fort Worth, Texas

March 29, 2022

We have served as the Company’s auditor since 2021.

TPG PARTNERS, LLC

BALANCE SHEET

December 31, 2021

Cash and cash equivalents $ 1,000

Deferred assets 650

Total assets $ 1,650

Liabilities and Member’s Interest

Accrued expenses 27,894

Total liabilities $ 27,894

Common interest, no par value 1,000

Accumulated deficit $ (27,244)

Total liabilities and member’s interest $ 1,650

TPG PARTNERS, LLC

STATEMENT OF LOSS

August 18, 2021 (inception) to December 31, 2021

Expenses 27,244

Net Loss $ (27,244)

TPG PARTNERS, LLC

STATEMENT OF MEMBER’S INTEREST

Member's interest Accumulated deficit Total member's interest

Balance at August 18, 2021 (Inception) $ — $ — $ —

Member capital contribution 1,000 — 1,000

Net Loss — (27,244) (27,244)

Balance at December 31, 2021 $ 1,000 $ (27,244) $ (26,244)

TPG PARTNERS, LLC

STATEMENT OF CASH FLOWS

August 18, 2021 (inception) to December 31, 2021

Operating activities:

Net loss $ (27,244)

Changes in operating assets and liabilities:

Deferred assets (650)

Accrued expenses 27,894

Net cash provided by operating activities —

Financing activities:

Contributions from member 1,000

Net cash provided by financing activities 1,000

Net change in cash and cash equivalents 1,000

Cash and cash equivalents, beginning of period —

Cash and cash equivalents, end of period $ 1,000

TPG PARTNERS, LLC

Notes to Financial Statements

TPG Holdings, LLC (the “Company” or “TPG”) was formed as a Delaware limited liability company on August 4, 2021.

On August 18, 2021, the Company filed with the Secretary of State of the State of Delaware to amend the Certificate of Formation to change the name of the Company to TPG Partners, LLC.

The Company consists of one class of limited liability company interest, all of which are held by the Company’s sole member, TPG GP A, LLC.

The sole member’s liability is limited to its contributed capital.

Under the terms of the limited liability company agreement, the Company shall have perpetual existence, unless the member votes for dissolution or dissolution is required by law.

The Company was formed for the purpose of completing a public offering and related transactions in order to carry on the business of the TPG Operating Group, which will be comprised of TPG Operating Group I, L.P., TPG Operating Group II, L.P., and TPG Operating Group III, L.P.

and their respective consolidated subsidiaries as a publicly traded entity (collectively “the TPG Operating Group”).

TPG Holdings, LLC and other partners and principals currently operate their business through TPG Operating Group.

Reorganization and Initial Public Offering

The owners of the TPG Operating Group completed a series of actions during the year ended December 31, 2021 and on January 12, 2022 as part of a corporate reorganization (the “Reorganization”), in conjunction with the initial public offering (“IPO”) that was completed on January 18, 2022.

The TPG Operating Group (and the entities through which its direct and indirect partners held their interests) was restructured and recapitalized.

On December 31, 2021, the TPG Operating Group transferred certain assets to Tarrant RemainCo I, L.P., Tarrant RemainCo II, L.P., and Tarrant RemainCo III, L.P.

(“RemainCo”) and distributed the interests in RemainCo to the owners of the TPG Operating Group.

The steps completed on December 31, 2021 by the TPG Operating Group, included the following activities:

• Transferred certain performance allocation economic entitlements to RemainCo.

These transfers resulted in an increase of $1,012.1 million of non-controlling interests which is reflected in the Consolidated Statement of Financial Condition.

• Transferred $738.9 million of economic entitlements associated with certain other investments, including our investment in our former affiliate and certain TPG Funds, to RemainCo.

This transfer reduced controlling and non-controlling interests by $629.0 and $109.9 million, respectively.

Following this transfer, the Company no longer holds more than an insignificant economic interest in the TPG Funds that have been historically consolidated and as a result, deconsolidated those respective TPG Funds.

As of December 31, 2021, we continue to consolidate Public SPACs as we continue to be the primary beneficiary.

• Transferred $75.0 million of cash on hand to RemainCo.

This transfer reduced controlling and non-controlling interests by $63.4 million and $11.6 million, respectively.

• Certain of the Company’s owners transferred their investment in the Company to an interest in the TPG Operating Group resulting in an increase to non-controlling interests totaling $16.6 million and a related decrease in controlling interests.

The results of these steps in the Reorganization did not have an impact on the Company’s Consolidated Financial Statements as of and for the year-ended December 31, 2021.

On January 12, 2022, the TPG Operating Group completed the remaining steps of the planned Reorganization.

The TPG Operating Group created Common Units and issued them to its controlling and non-controlling interest holders.

Immediately following the Reorganization, the TPG Operating Group and its subsidiaries were controlled by the same parties and as such, the Reorganization is a transfer of interests under common control.

As part of the Reorganization, the Company changed its name to TPG Inc.

and converted to a Delaware corporation.

In conjunction with the IPO, the Company offered 33,900,000 shares of Class A common stock at a price of $29.50 per share, including 5,589,806 shares sold by a non-controlling interest holder of the TPG Operating Group.

Additionally, certain pre-IPO investors exchanged their interests in the TPG Operating Group for interests in TPG Inc.

totaling 35,136,254 Class A voting and 8,258,901 Class A non-voting common stock.

The IPO closed on January 18, 2022, and TPG Inc.

received proceeds, net of underwriting discounts and unpaid offering costs, totaling approximately $771.0 million.

Net proceeds of $380.1 million were used to purchase Common Units of the TPG Operating Group from certain existing non-controlling interest holders and the remaining net proceeds were used to acquire newly issued Common Units of the TPG Operating Group.

As a result of the Reorganization and IPO, TPG Inc.

only holds Common Units of the TPG Operating Group.

On February 9, 2022, the Company and the selling stockholder sold an additional 1,775,410 and 1,614,590 Class A common stock respectively at the initial public offering price pursuant to the underwriters’ exercise of their option to purchase additional shares.

received additional net proceeds totaling approximately $49.8 million.

The underwriters’ exercise of their option in addition to the IPO related transactions resulted in a total of 70,811,664 and 8,258,901 of Class A voting and Class A non-voting common stock outstanding, respectively.

TPG Inc.’s ownership of the TPG Operating Group totaled approximately 26%.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accompanying audited financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.

GAAP”) and reflect all adjustments, consisting only of normal recurring adjustments, which are, in the opinion of management, necessary for a fair presentation of the Company’s Balance Sheet at December 31, 2021 and the Statement of Loss and Statement of Cash Flows for the period presented.

COMMITMENTS AND CONTINGENCIES

In the ordinary course of business, the Company may be subject to various legal, regulatory and/or administrative proceedings.

There are currently no such proceedings to which the Company is a party.

In the ordinary course of business, the Company may enter into contracts that contain a variety of indemnifications.

The Company’s maximum exposure under these arrangements cannot be determined as these indemnities relate to future claims that may be made against the Company, but which have not yet occurred.

However, the Company has not had prior claims or losses pursuant to these contracts and expects the risk of loss to be remote.

SUBSEQUENT EVENTS

In January 2022, TPG Inc.

granted the following stock-based awards in connection with its IPO:

• 8.3 million restricted stock units (“RSUs”) with a grant date fair value of $243.4 million which are generally satisfied over four years.

• 2.2 million RSUs with a grant date fair value of $50.8 million, awarded to certain of the Company’s executives, which are generally satisfied over five years and achievement of a performance-condition.

Other than the Reorganization and IPO described in Note 1 and the event described above, there are no additional subsequent events through the date of issuance of the consolidated financial statements which require adjustment or disclosure.

Report of Independent Registered Public Accounting Firm

To the Partners and the Executive Committee of TPG Group Holdings (SBS), L.P.

To the Shareholders and the Board of Directors of TPG Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated statements of financial condition of TPG Group Holdings (SBS), L.P.

(the "Company") as of December 31, 2021 and 2020, the related consolidated statements of operations, changes in partners’ capital, and cash flows, for each of the three years in the period ended December 31, 2021, and the related notes (collectively referred to as the "financial statements").

We have audited the accompanying consolidated statements of financial condition of TPG Inc.

(the "Company") as of December 31, 2022 and 2021, the related consolidated statements of operations, changes in equity, and cash flows, for each of the three years in the period ended December 31, 2022, and the related notes (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2022, in conformity with accounting principles generally accepted in the United States of America.

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federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB and in accordance with auditing standards generally accepted in the United States of America.

We conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

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The communication of critical audit matters does not alter in any way our opinion on the 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.

Fair Value — Underlying Investments Without Readily Determinable Fair Values Used in the Calculation of Carried Interest — Refer to Notes 2 and 4 of the financial statements

Fair Value — Underlying Investments Without Readily Determinable Fair Values Used in the Calculation of Performance Allocations — Refer to Notes 2 and 4 of the financial statements

Critical Audit Matter Description

The Company, as a general partner, is entitled to an allocation of income from certain TPG Funds (“TPG Funds”), assuming certain investment returns are achieved, referred to as “Carried Interest”.

Carried Interest is accrued based on cumulative fund performance to date, and after specified investment returns to the TPG Funds’ limited partners are achieved.

Performance Allocations are accrued based on cumulative fund performance to date, and after specified investment returns to the TPG Funds’ limited partners are achieved.

The fair value of the underlying investments held by the TPG Funds is a significant input into this calculation.

As the fair value of underlying investments varies between reporting periods, adjustments are made to amounts recorded as Carried Interest, which is recorded as revenues, to reflect either (a) positive performance resulting in an

increase in the Carried Interest or (b) negative performance that would cause the amount due to the general partner to be less than the amount previously recognized as revenue, resulting in a negative adjustment to Carried Interest.

In each case, Carried Interest is calculated on a cumulative basis and cumulative results are compared to amounts previously recorded, with a current period adjustment.

Accrued but unpaid Carried Interest as of the reporting date is reflected in Investments in the consolidated statements of financial condition.

We considered the valuation of investments without readily determinable fair values used in the calculation of Carried Interest as a critical audit matter because of the valuation techniques, assumptions, and subjectivity of the unobservable inputs used in the valuation.

As the fair value of underlying investments varies between reporting periods, adjustments are made to amounts recorded as Performance Allocations, which are recorded as revenues, to reflect either (a) positive performance resulting in an increase in the Performance Allocations or (b) negative performance that would cause the amount due to the general

partner to be less than the amount previously recognized as revenue, resulting in a negative adjustment to Performance Allocations.

In each case, Performance Allocations are calculated on a cumulative basis and cumulative results are compared to amounts previously recorded, with a current period adjustment.

Accrued but unpaid Performance Allocations as of the reporting date are reflected in Investments in the consolidated statements of financial condition.

We considered the valuation of investments without readily determinable fair values used in the calculation of Performance Allocations as a critical audit matter because of the valuation techniques, assumptions, and subjectivity of the unobservable inputs used in the valuation.

Auditing the fair value of these investments required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists who possess significant investment valuation expertise.

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Fort Worth, Texas

March 29, 2022

February 24, 2023

We have served as the Company’s auditor since 2015.

TPG Group Holdings (SBS), L.P.

Consolidated Statements of Financial Condition

(in thousands)

(dollars in thousands, except share data)

December 31, 2022 December 31, 2021

Cash and cash equivalents $ 1,107,484 $ 972,729

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Due from affiliates 202,639 185,321

Investments (includes assets pledged of $492,276 and $395,172 as of December 31, 2021 and 2020, respectively (1) )

Investments (includes assets pledged of $ 475,110 and $ 492,276 as of December 31, 2022 and December 31, 2021, respectively (1) )

5,329,868 6,109,046

Right-of-use assets 157,467 179,600

Other assets 629,392 657,317

2 unchanged sentences

Assets held in Trust Accounts 653,635 1,000,027

Investments — 243,361

Due from affiliates 74 1,033

Due from counterparty — 110,482

Other assets 457 19,067

Total assets $ 7,941,738 $ 8,962,013

Liabilities, Redeemable Equity and Partners' Capital

Liabilities, Redeemable Equity and Equity

Accounts payable and accrued expenses $ 98,171 $ 134,351

3 unchanged sentences

Senior unsecured term loan 199,307 199,494

Senior unsecured revolving credit facility — 50,000

Operating lease liabilities 177,003 195,987

Accrued performance allocation compensation 3,269,889 —

Other liabilities 226,090 238,246

Liabilities of consolidated TPG Funds and Public SPACs (1) :

Accounts payable and accrued expenses 8,484 4,057

Securities sold, not yet purchased — 79,798

Due to affiliates — 2,561

Due to counterparty — 12,021

Derivative liabilities of Public SPACs 13,048 263,269

Derivative liabilities 667 13,048

Deferred underwriting 22,750 35,000

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Commitments and contingencies (Note 18)

Redeemable equity from consolidated Public SPACs (1)

Redeemable equity attributable to consolidated Public SPACs (1)

653,635 1,000,027

Partners' capital

Class A common stock $ 0.001 par value, 2,340,000,000 shares authorized ( 79,240,058 and 0 shares issued and outstanding as of December 31, 2022 and December 31, 2021, respectively)

Class B common stock $ 0.001 par value, 750,000,000 shares authorized ( 229,652,641 and 0 shares issued and outstanding as of December 31, 2022 and December 31, 2021, respectively)

Preferred stock, $ 0.001 par value, 25,000,000 shares authorized ( 0 issued and outstanding as of December 31, 2022 and December 31, 2021, respectively)

Additional paid-in-capital 506,639 —

Retained earnings 2,724 —

Partners’ capital controlling interests — 1,606,593

Non-controlling interests in consolidated TPG Funds — 204,548

Other non-controlling interests 2,576,199 4,654,821

Total partners' capital 6,261,414 4,720,702

Total liabilities, redeemable equity and partners' capital $ 8,962,013 $ 7,000,551

Total equity 3,085,871 6,261,414

Total liabilities, redeemable equity and equity $ 7,941,738 $ 8,962,013

________________

(1) The Company’s consolidated total assets and liabilities as of December 31, 2021 and 2020 include assets and liabilities of variable interest entities (“VIEs”).

The assets can be used only to satisfy obligations of the VIEs, and the creditors of the VIEs have recourse only to these assets, and not to TPG Group Holdings (SBS), LP.

These amounts include the assets and liabilities of consolidated TPG Funds and Public SPACs, restricted cash, assets pledged of securitization vehicles, secured borrowings of securitization vehicles, and redeemable equity of consolidated Public SPACs.

See Note 11 to the Consolidated Financial Statements.

(1) The Company’s consolidated total assets and liabilities as of December 31, 2022 and December 31, 2021 include assets and liabilities of variable interest entities (“VIEs”).

The assets can be used only to satisfy obligations of the VIEs, and the creditors of the VIEs have recourse only to these assets, and not to TPG Inc.

These amounts include the assets and liabilities of consolidated Public SPACs, restricted cash, assets pledged of securitization vehicles, secured borrowings of securitization vehicles, and redeemable equity of consolidated Public SPACs.

See Notes 2, 11 and 16 to the Consolidated Financial Statements .

See accompanying notes to Consolidated Financial Statements.

TPG Group Holdings (SBS), L.P.

Consolidated Statements of Operations

(in thousands)

(dollars in thousands, except share and per share data)

Year Ended December 31,

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Compensation and benefits:

Cash-based compensation and benefits 473,696 579,698 522,715

Equity-based compensation 627,714 — —

Performance allocation compensation 416,556 — —

Total compensation and benefits 1,517,966 579,698 522,715

General, administrative and other 368,915 278,590 260,748

Depreciation and amortization 32,990 21,223 7,137

Interest expense (includes affiliates of $188 , $1,998 and $2,352 as of December 31, 2021, 2020 and 2019, respectively)

16,291 18,993 15,532

Interest expense 21,612 16,291 18,993

Expenses of consolidated TPG Funds and Public SPACs:

2 unchanged sentences

Total expenses 1,944,799 916,566 817,556

Investment income

Income from investments:

Net gains (losses) from investment activities 353,219 (5,839) 71,694

Investment income (loss)

Income (loss) from investments:

Net (losses) gains from investment activities ( 110,131 ) 353,219 ( 5,839 )

Gain on deconsolidation — — 401,695

Interest, dividends and other (includes affiliates of $1,153 , $4,785 and $9,469 as of December 31, 2021, 2020 and 2019, respectively)

6,460 8,123 18,992

Interest, dividends and other 9,168 6,460 8,123

Investment income of consolidated TPG Funds and Public SPACs:

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Unrealized gains (losses) on derivative liabilities of Public SPACs 12,382 211,822 ( 239,269 )

Interest, dividends and other (includes affiliates of $285 , $1,031 and $349 as of December 31, 2021, 2020 and 2019, respectively)

10,321 5,410 16,161

Total investment income 605,214 151,429 166,758

Income before income taxes 4,665,035 1,448,711 1,186,132

Interest, dividends and other 6,741 10,321 5,410

Total investment (loss) income ( 81,840 ) 605,214 151,429

(Loss) income before income taxes ( 23,752 ) 4,665,035 1,448,711

Income tax expense 32,483 9,038 9,779

Net income 4,655,997 1,438,932 1,180,443

Net income (loss) attributable to redeemable equity in Public SPACs 155,131 (195,906) (9,684)

Net income (loss) attributable to non-controlling interests in consolidated TPG Funds 19,287 (12,380) 58,055

Net (loss) income ( 56,235 ) 4,655,997 1,438,932

Net (loss) income attributable to redeemable equity in Public SPACs prior to Reorganization and IPO ( 517 ) 155,131 ( 195,906 )

Net income attributable to non-controlling interests in consolidated TPG Funds prior to Reorganization and IPO — 19,287 ( 12,380 )

Net income attributable to other non-controlling interests prior to Reorganization and IPO 966 2,455,825 719,640

Net income attributable to TPG Group Holdings prior to Reorganization and IPO 5,256 2,025,754 927,578

Net income attributable to redeemable equity in Public SPACs 15,165 — —

Net loss attributable to non-controlling interests in TPG Operating Group ( 180,824 ) — —

Net income attributable to other non-controlling interests 11,293 — —

Net income attributable to controlling interests $ 2,025,754 $ 927,578 $ 480,514

Net income attributable to TPG Inc.

subsequent to Reorganization and IPO $ 92,426 $ — $ —

Net income (loss) per share data:

Net income (loss) available to Class A common stock per share

Basic $ 1.10 $ — $ —

Diluted $ ( 0.19 ) $ — $ —

Weighted-average shares of Class A common stock outstanding

Basic 79,255,411 — —

Diluted 308,908,052 — —

See accompanying notes to Consolidated Financial Statements.

TPG Group Holdings (SBS), L.P.

Consolidated Statements of Changes in Partners’ Capital

(in thousands)

Controlling Interests Non-Controlling Interests

Capital Non˗Controlling

TPG Funds Other Non-

Interests Total Partners'

Consolidated Statements of Changes in Equity

(dollars in thousands, except share data)

Shares of TPG Inc.

Partners' Capital Class A Common Stock Class B Common Stock Class A Common Stock, at par value Class B Common Stock, at par value Additional Paid-In Capital Retained Earnings (Deficit) Accumulated Other Comprehensive Income (Loss) Total TPG Inc.

Equity Other Non-Controlling Interests Total Partners' Capital/

Balance at January 1, 2020 $ 2,017,973 — — $ — $ — $ — $ — $ — $ — $ 2,237,921 $ 4,255,894

Net income 480,514 58,055 651,558 1,190,127

Capital contributions 120 54,008 1,806 55,934

Capital distributions (320,178) (39,239) (508,459) (867,876)

Change in receivable from sale of non-controlling interests in consolidated entities 9,145 — 1,688 10,833

Deconsolidation of previously consolidated entities 22,049 (53,028) 32,126 1,147

Change in redemption value of redeemable non-controlling interest (5,134) — (7,052) (12,186)

Balance at December 31, 2019 2,017,973 216,223 2,021,698 4,255,894

Net income (loss) 927,578 — — — — — — — — 707,260 1,634,838

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Balance at December 31, 2020 $ 2,460,868 — — $ — $ — $ — $ — $ — $ — $ 2,259,834 $ 4,720,702

Shares of TPG Inc.

Equity Other Non-Controlling Interests Total Partners' Capital/

Balance at January 1, 2021 $ 2,460,868 — — $ — $ — $ — $ — $ — $ — $ 2,259,834 $ 4,720,702

Net income 2,025,754 — — — — — — — — 2,475,112 4,500,866

2 unchanged sentences

Deconsolidation of previously consolidated entities 36,386 — — — — — — — — 61,151 97,537

Acquisition of NewQuest — — 301,189 301,189

Change in redemption value of redeemable non-controlling interest 35,157 — — — — — — — — 53,292 88,449

Acquisition of NewQuest — — — — — — — — — 301,189 301,189

Reorganization ( 1,721,062 ) — — — — — — — — 693,651 ( 1,027,411 )

1 unchanged sentence

See accompanying notes to Consolidated Financial Statements.

TPG Group Holdings (SBS), L.P.

Consolidated Statements of Changes in Equity

(dollars in thousands, except share data)

Shares of TPG Inc.

Equity Other Non-Controlling Interests Total Partners' Capital/

Balance at January 1, 2022 $ 1,606,593 — — $ — $ — $ — $ — $ — $ — $ 4,654,821 $ 6,261,414

Net income prior to Reorganization and IPO 5,256 — — — — — — — — 966 6,222

Change in redemption value of redeemable non-controlling interest prior to Reorganization and IPO ( 110 ) — — — — — — — — ( 407 ) ( 517 )

Effect of Reorganization and purchase of units in the Partnership ( 1,611,739 ) 48,984,961 229,652,641 49 230 271,780 ( 27 ) — 272,032 1,341,603 1,896

Issuance of common stock in IPO, net of underwriting discount and issuance costs — 28,310,194 — 28 — 784,611 — — 784,639 ( 25,426 ) 759,213

Purchase of Partnership Interests with IPO proceeds — — — — — — — — — ( 379,597 ) ( 379,597 )

Issuance of common stock from Underwriters' exercise of over-allotment option, net of underwriting discount and issuance costs — 1,775,410 — 2 — 49,754 — — 49,756 — 49,756

Equity reallocation between controlling and non-controlling interests prior to Reorganization and IPO — — — — — ( 654,129 ) — — ( 654,129 ) 654,129 —

Acquisition of NewQuest — — — — — 33,584 — — 33,584 ( 33,584 ) —

Deferred tax effect resulting from purchase of Class A Units, net of amounts payable under Tax Receivable Agreement — — — — — ( 13,232 ) — — ( 13,232 ) — ( 13,232 )

Liability-based performance allocation compensation — — — — — — — — — ( 3,525,767 ) ( 3,525,767 )

Net income (loss) subsequent to Reorganization and IPO — — — — — — 92,426 — 92,426 ( 169,531 ) ( 77,105 )

Shares issued for equity-based awards — 169,493 — 0 — 1,088 — — 1,088 ( 901 ) 187

Equity-based compensation subsequent to Reorganization and IPO — — — — — 31,841 — — 31,841 602,647 634,488

Capital contributions subsequent to Reorganization and IPO — — — — — — — — — 13,039 13,039

Dividends/Distributions — — — — — — ( 89,675 ) — ( 89,675 ) ( 576,955 ) ( 666,630 )

Change in redemption value of redeemable non-controlling interest subsequent to Reorganization and IPO — — — — — 1,342 — — 1,342 21,162 22,504

Balance at December 31, 2022 $ — 79,240,058 229,652,641 $ 79 $ 230 $ 506,639 $ 2,724 $ — $ 509,672 $ 2,576,199 $ 3,085,871

See accompanying notes to Consolidated Financial Statements.

Consolidated Statements of Cash Flows

(in thousands)

(dollars in thousands)

Year Ended December 31,

1 unchanged sentence

Operating activities:

Net income $ 4,655,997 $ 1,438,932 $ 1,180,443

Adjustments to reconcile net income to net cash provided by operating activities:

(Gain) loss from investment activities (353,219) 5,839 (71,694)

Gain on deconsolidation (see Note 4) — (401,695) —

Net (loss) income $ ( 56,235 ) $ 4,655,997 $ 1,438,932

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Equity-based compensation 627,714 — —

Performance allocation compensation 416,556 — —

Loss (gain) from investment activities 110,131 ( 353,219 ) 5,839

Gain on deconsolidation — — ( 401,695 )

Capital allocation-based income ( 756,252 ) ( 3,998,483 ) ( 1,231,472 )

Depreciation and amortization expense 21,835 7,721 9,303

Non-cash lease expense 23,894 23,533 25,283

Adjustments related to consolidated TPG Funds and Public SPACs:

Realized gain on investments (19,716) (3,989) (35,975)

Change in unrealized (gain) loss on investments (4,024) 7,939 (40,229)

Realized loss (gain) on investment-related derivatives 10,444 3,217 (5,407)

Change in unrealized (gain) loss on investment-related derivatives (10,096) 11,524 6,400

Change in unrealized (gain) loss on derivative liabilities of Public SPACs (211,822) 239,269 15,300

Other non-cash activities 29,939 45,729 31,254

Net (gains) losses from investment activities of consolidated TPG Funds and Public SPACs ( 12,382 ) ( 235,214 ) 257,960

Changes in operating assets and liabilities:

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Other assets ( 35,893 ) ( 22,586 ) 187

Operating lease liabilities (20,766) (21,035) (23,832)

Accounts payable and accrued expenses ( 14,235 ) 51,148 42,124

Due to affiliates ( 12,528 ) 11,129 3,885

Accrued performance allocation compensation ( 672,375 ) — —

Other liabilities ( 22,515 ) ( 26,931 ) 54,634

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Cash and cash equivalents 274 5,839 31,584

Investments held in Trust Accounts (630,281) (800,011) 263,192

Due from affiliates (903) (128) (29)

Due from counterparty 10,424 13,184 (41,742)

Assets held in Trust Accounts 346,392 ( 630,281 ) ( 800,011 )

Other assets 18,611 ( 12,583 ) 13,193

Accounts payable and accrued expenses 10,172 3,110 1,097

Due to affiliates 1,987 (63) 2,833

Due to counterparty (1,160) 3,336 2,714

Deferred underwriting compensation 6,855 — —

Other liabilities ( 7,537 ) 19,884 6,167

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Deconsolidation of previously consolidated vehicles (see Note 4) — — ( 107,221 )

Net cash (used in) provided by investing activities (37,745) (108,096) 17,404

See accompanying notes to consolidated financial statements.

Year Ended December 31,

2021 2020 2019

Net cash used in investing activities ( 3,012 ) ( 37,745 ) ( 108,096 )

Financing activities:

Proceeds from issuance of common stock in IPO, net of underwriting and issuance costs 770,865 — —

Proceeds from issuance of common stock from underwriters' exercise of over-allotment option, net of underwriting and issuance costs 49,756 — —

Purchase of partnership interests with IPO proceeds ( 379,597 ) — —

Reorganization activities 2,124 — —

Proceeds from senior unsecured term loan — 200,000 —

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Proceeds from sale of non-controlling interests — — 10,833

Proceeds from notes issuance — — 50,000

See accompanying notes to Consolidated Financial Statements.

Year Ended December 31,

2022 2021 2020

Debt issuance costs — ( 520 ) —

Contributions from holders of other non-controlling interests 7,822 4,636 7,884

Distributions to holders of other non-controlling interests (1,009,242) (310,159) (384,346)

Contributions from partners — 7,824 120

Distributions to partners (1,066,680) (298,584) (248,256)

Changes related to consolidated TPG Funds and Public SPACs:

Distributions to holders of other non-controlling interests prior to Reorganization and IPO ( 318,942 ) ( 1,009,242 ) ( 310,159 )

Contributions from partners prior to Reorganization and IPO — — 7,824

Dividends/Distributions ( 662,812 ) — —

Distributions to partners prior to Reorganization and IPO ( 355,282 ) ( 1,066,680 ) ( 298,584 )

Changes related to TPG Funds and Public SPACs:

Proceeds from SPAC IPOs — 935,000 800,000

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Conversion from notes receivable from affiliate to equity method investments — — ( 8,380 )

In-kind distributions of investments 36,334 89,834 145,535

Proceeds receivable on sale of investments (31,104) (7,750) (105,959)

Investment in equity method investments — ( 3,138 ) —

In-kind proceeds from investments — 36,334 89,834

Proceeds receivable on sale of investments ( 6,244 ) ( 31,104 ) ( 7,750 )

Increase in due from affiliates — ( 3,045 ) —

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Equity interests transferred for NewQuest acquisition — 24,600 —

Deferred underwriting (35,441) (28,000) 4,000

Deferred underwriting related to Public SPACs 12,250 ( 35,441 ) ( 28,000 )

Distributions in-kind to partners — — ( 57,281 )

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Cash, cash equivalents and restricted cash, end of period $ 1,120,650 $ 985,864 $ 871,355

________________

(a) For supplemental disclosures related to deconsolidation of previously consolidated TPG Funds and Public SPACs and activities related to deconsolidation of the Former Affiliate, see Note 4 .

See accompanying notes to Consolidated Financial Statements.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

TPG Group Holdings (SBS), L.P.

is a limited partnership under the Delaware Revised Uniform Limited Partnership Act, as amended.

TPG Group Holdings (SBS), L.P., along with its consolidated subsidiaries (collectively “TPG,” “TPG Group Holdings,” or the “Company”), is a leading global alternative asset manager on behalf of third-party investors under the “TPG” brand name.

TPG Group Holdings includes the consolidated accounts of management companies, general partners of pooled investment entities (“TPG Funds”) and certain consolidated funds and Special Purpose Acquisition Companies (“Public SPACs” and/or “SPACs”), which are held in one of three holding companies (TPG Holdings I, L.P., TPG Holdings II, L.P.

and TPG Holdings III, L.P.) (the “Holdings Companies”).

The Holdings Companies are controlled by TPG Group Holdings.

TPG is headquartered in Fort Worth, Texas, with senior executives based in both Fort Worth and in San Francisco, California and other principal offices in New York and across Asia, Australia and Europe.

On January 4, 2022, the Company filed with the Secretary of State of the State of Delaware to amend the Certificate of Formation to change the name of TPG Holdings I, L.P., TPG Holdings II, L.P.

and TPG Holdings III, L.P.

to TPG Operating Group I, L.P.;

TPG Operating Group II, L.P.;

and TPG Operating Group III, L.P.

(collectively the “TPG Operating Group”), respectively.

TPG Inc., along with its consolidated subsidiaries (collectively “TPG,” or the “Company”) is a leading global alternative asset manager on behalf of third-party investors under the “TPG” brand name.

includes the consolidated accounts of management companies, general partners of pooled investment entities and Special Purpose Acquisition Companies (“Public SPACs” and/or “SPACs”), which are held in one of three holding companies (TPG Operating Group I, L.P., TPG Operating Group II, L.P.

and TPG Operating Group III, L.P.) (collectively the “TPG Operating Group”).

Reorganization and IPO

The owners of TPG Group Holdings and the TPG Operating Group completed a series of actions during the year ended December 31, 2021 and on January 12, 2022 as part of a corporate reorganization (the “Reorganization”), in conjunction with an initial public offering (“IPO”) that was completed on January 18, 2022.

The owners of TPG Group Holdings and the TPG Operating Group completed a series of actions on January 12, 2022 as part of a corporate reorganization (the “Reorganization”), in conjunction with an initial public offering (“IPO”) that was completed on January 18, 2022.

TPG Partners, LLC was created on August 4, 2021 to effectuate the IPO and acquire Common Units of the TPG Operating Group on behalf of public investors.

TPG Partners, LLC was designed as a holding company, and its only business is to act as the owner of the entities serving as the general partner of the TPG Operating Group partnerships.

TPG Partners, LLC was designed as a holding company, and its only business was to act as the owner of the entities serving as the general partner of the TPG Operating Group partnerships.

The TPG Operating Group (and the entities through which its direct and indirect partners held their interests) was restructured and recapitalized.

On December 31, 2021, the TPG Operating Group transferred certain assets to Tarrant RemainCo I, L.P., Tarrant RemainCo II, L.P., and Tarrant RemainCo III, L.P.

(collectively “RemainCo”) and distributed the interests in RemainCo to the owners of the TPG Operating Group.

The steps completed on December 31, 2021, and reflected on the Consolidated Statement of Financial Condition, included the following activities:

• Transferred certain performance allocation economic entitlements to RemainCo.

These transfers resulted in an increase of $1,012.1 million of non-controlling interests which is reflected in the Consolidated Statement of Financial Condition.

• Transferred $738.9 million of economic entitlements associated with certain other investments, including our investment in our Former Affiliate, as defined in Note 4, and certain TPG Funds, to RemainCo.

This transfer reduced controlling and non-controlling interests by $629.0 and $109.9 million, respectively.

As of December 31, 2021, we continue to consolidate Public SPACs as we continue to be the primary beneficiary.

• Transferred $75.0 million of cash on hand to RemainCo.

This transfer reduced controlling and non-controlling interests by $63.4 million and $11.6 million, respectively.

• Certain owners of the Company’s parent exchanged their interests for an interest in the TPG Operating Group resulting in an increase to non-controlling interests totaling $16.6 million and a related decrease in controlling interests.

• The results of the Reorganization did not have an impact on our Consolidated Statement of Operations for the year ended December 31, 2021.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

On December 31, 2021, the TPG Operating Group transferred certain assets to Tarrant Remain Co I, L.P., Tarrant Remain Co II, L.P., Tarrant Remain Co III, L.P., and Tarrant Remain Co GP, LLC, a Delaware limited liability company serving as their general partner (collectively “RemainCo”) and distributed the interests in RemainCo to the owners of the TPG Operating Group.

Following the transfer of certain assets, the Company deconsolidated certain TPG Funds (“TPG Funds”) as of December 31, 2021 as the Company is no longer their primary beneficiary.

The following table summarizes the impact of the deconsolidation of the TPG Funds, which resulted from the transfer of economic entitlements to RemainCo related to the TPG Funds we previously consolidated, on the Consolidated Statement of Financial Condition as of December 31, 2021 (in thousands):

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Non-controlling interests in consolidated TPG Funds 213,559 ( 213,559 ) —

Other non-controlling interests — — —

Total partners’ capital 279,040 ( 279,040 ) —

Total liabilities and partners' capital $ 355,541 $ ( 355,541 ) $ —

Notes to Consolidated Financial Statements

On January 12, 2022, the following steps were completed:

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The TPG Operating Group created Common Units and issued them to the Company and the other non-controlling interest holders of the TPG Operating Group.

Immediately following the Reorganization, the TPG Operating Group and its subsidiaries will be controlled by the same parties and as such, the Reorganization is a transfer of interests under common control.

Accordingly, the Company will carry forward the existing value of the members’ interests in the assets and liabilities in these Consolidated Financial Statements prior to the IPO into the financial statements following the IPO.

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The IPO closed on January 18, 2022, and TPG Inc.

received proceeds, net of underwriting discounts and unpaid offering costs, totaling approximately $771.0 million.

Net proceeds of $380.1 million were used to repurchase Common Units of the TPG Operating Group from certain existing non-controlling interest holders, acquire newly issued Common Units of the TPG Operating Group and the remaining net proceeds are available for general corporate purposes.

received proceeds totaling $ 770.9 million, net of $ 41.8 million in underwriting discounts and commissions, as well as $ 22.5 million of issuance costs.

Proceeds of $ 379.6 million were used to repurchase Common Units of the TPG Operating Group from certain existing non-controlling interest holders, acquire newly issued Common Units of the TPG Operating Group and the remaining net proceeds are available for general corporate purposes.

As a result of the Reorganization and IPO, TPG Inc.

only holds Common Units of the TPG Operating Group.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

On February 9, 2022, the Company and the selling stockholder sold an additional 1,775,410 and 1,614,590 Class A common stock, respectively, at the initial public offering price pursuant to the underwriters’ exercise of their option to purchase additional shares.

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TPG Inc.’s ownership of the TPG Operating Group totaled approximately 26% on February 9, 2022.

TPG Inc.’s ownership of the TPG Operating Group totaled approximately 26 % on December 31, 2022.

Summary of Significant Accounting Policies

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The accompanying consolidated financial statements (the “Consolidated Financial Statements”) have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.

All dollar amounts are stated in thousands unless otherwise indicated.

All intercompany transactions and balances have been eliminated.

The Consolidated Financial Statements include the accounts of TPG Group Holdings (SBS), L.P, TPG Operating Group (formerly known as “the Holdings Companies”) and their consolidated subsidiaries, TPG’s management companies, the general partners of TPG Funds and entities that meet the definition of a variable interest entity (“VIE”) for which the Company is considered the primary beneficiary.

Certain TPG Funds and Public SPACs, are consolidated into the general partners pursuant to U.S.

Consequently, the accompanying Consolidated Financial Statements include the assets, liabilities, revenues, expenses and cash flows of such certain TPG Funds and Public SPACs.

The ownership interest in such certain TPG Funds held by entities or persons outside of TPG is reflected as non-controlling interests in consolidated TPG Funds in the accompanying Consolidated Financial Statements.

All of the management fees, carried interest and other amounts earned from the consolidated TPG Funds and Public SPACs are eliminated in consolidation.

Certain comparative amounts for the prior fiscal period have been reclassified to conform to the financial statement presentation as of and for the period ended December 31, 2022.

The Consolidated Financial Statements include the accounts of TPG Inc., TPG Operating Group (formerly known as “the Holdings Companies”) and their consolidated subsidiaries, TPG’s management companies, the general partners of TPG funds and entities that meet the definition of a variable interest entity (“VIE”) for which the Company is considered the primary beneficiary.

The prior period financial statements present the consolidated accounts of TPG Group Holdings, which is considered the predecessor for accounting purposes.

Following the completion of our IPO, TPG Inc.

is the successor for accounting purposes.

Prior to the Reorganization and IPO, the Company’s predecessor consolidated certain TPG Funds and Public SPACs (herein referred to as “consolidated TPG Funds and Public SPACs”) pursuant to U.S.

GAAP, as the Company’s predecessor was considered the primary beneficiary.

Following the Reorganization and IPO, the Company no longer has a controlling financial interest in certain TPG Funds and continues to have a controlling financial interest in Public SPACs.

Public SPACs are consolidated pursuant to U.S.

Consequently, the accompanying Consolidated Financial

Notes to Consolidated Financial Statements

Statements include the assets, liabilities, revenues, expenses and cash flows of such certain consolidated Public SPACs.

The ownership interest in certain TPG Funds held by entities or persons outside of TPG are reflected as other non-controlling interests in the accompanying Consolidated Financial Statements for fiscal years beginning prior to January 1, 2022.

All of the management fees, performance allocations (as defined herein) and other amounts earned from the consolidated TPG Funds and Public SPACs are eliminated in consolidation.

In addition, the equivalent expense amounts recorded by the consolidated TPG Funds and Public SPACs are also eliminated, with such reduction of expenses allocated to controlling interest holders.

Accordingly, the consolidation of TPG Funds and Public SPACs has no net effect on net income attributable to controlling interests and net income attributable to other non-controlling interests.

Accordingly, the consolidation of these entities has no net effect on net income attributable to TPG Inc., its predecessor, or net income attributable to other non-controlling interests.

TPG Funds’ investments (the “Portfolio Companies”) are considered affiliates due to the nature of the Company’s ownership interests.

As part of the Reorganization, the TPG Operating Group transferred a portion of its interest in certain consolidated TPG Funds to RemainCo on December 31, 2021, which resulted in the deconsolidation of the TPG Funds as the TPG Operating Group no longer holds a controlling financial interest.

Use of Estimates

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Actual results could differ from those estimates and such differences could be material to the Consolidated Financial Statements.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

COVID-19 and Global Economic and Market Conditions

In March 2020, the World Health Organization declared the outbreak of COVID-19 as a global pandemic.

Numerous countries, including the United States, instituted a variety of restrictive measures to contain the viral spread, including mandatory quarantines and travel restrictions, leading to significant disruptions and uncertainty in the global financial markets.

While many of the initial restrictions in the United States have been relaxed or removed, the risk of future outbreaks of COVID-19, or variants thereof, or of other public health crises remain.

Further, certain public health restrictions remain in place and lifted restrictions may be reimposed to mitigate risks to public health.

In 2021, the global economy began reopening, facilitating robust economic activity.

However, the economic recovery is only partially underway and has been gradual, uneven and characterized by meaningful dispersion across sectors and regions with uncertainty regarding its ultimate length and trajectory.

Further, the emergence of COVID-19 variants and related surges in cases have resulted in setbacks to the recovery, and subsequent surges could lead to renewed restrictions.

Many public health experts believe that COVID-19 could persist or reoccur for years, and even if the lethality of the virus declines, such reoccurrence could trigger increased restrictions on business operations.

Despite significant market rebounds across many asset classes, the continued rapid development and fluidity of this situation precludes any prediction as to the ultimate adverse impact of COVID-19 on financial market and economic conditions.

The estimates and assumptions underlying these Consolidated Financial Statements are based on the information available as of December 31, 2021 for the current period and as of December 31, 2020, as applicable.

The estimates and assumptions include judgments about financial market and economic conditions which have changed, and may continue to change, over time.

Principles of Consolidation

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(i) the equity investment at risk is not sufficient to finance the activities of the entity without additional subordinated financial support, (ii) as a group, the holders of the equity investment at risk lack the power to direct the activities that most significantly impact the entity’s economic performance or the obligation to absorb the expected losses or right to receive the expected residual returns, and (iii) the voting rights of some holders of the equity investment at risk are disproportionate to their obligation to absorb losses or right to receive returns, and substantially all of the activities are conducted on behalf of the holder of equity investment at risk with disproportionately few voting rights.

For limited partnerships, partners lack power if neither (1) a simple majority or lower threshold (including a single limited partner) with equity at risk is able to exercise substantive kick-out rights through voting interests over the general partner, nor (2) limited partners with equity at risk are able to exercise substantive participating rights over the general partners.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

For limited partnerships, partners lack power if neither (i) a simple majority or lower threshold (including a single limited partner) with equity at risk is able to exercise substantive kick-out rights through voting interests over the general partner, nor (ii) limited partners with equity at risk are able to exercise substantive participating rights over the general partners.

TPG consolidates all VIEs in which it is the primary beneficiary.

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TPG consolidates VOEs that it controls through a majority voting interest or through other means.

Notes to Consolidated Financial Statements

The TPG Funds do not consolidate wholly-owned, majority-owned or controlled investments in Portfolio Companies, nor do the TPG Funds account for investments in Portfolio Companies over which they exert significant influence under the equity method of accounting.

Rather, these investments are carried at fair value as described below in the section entitled Fair Value Measurement.

As of December 31, 2021, the Company no longer consolidates such TPG Funds (see Note 1).

Special Purpose Acquisition Companies

The Company invests in and sponsors SPACs which are formed for the purposes of effecting a merger, asset acquisition, stock purchase, reorganization or other business combination.

In the IPO of each of these SPACs, either common shares or units (which include one Class A ordinary share and, in some cases, a fraction of a redeemable public warrant which entitles the holder to purchase one share of Class A ordinary shares at a fixed exercise price) are sold to investors.

Each SPAC provides its public shareholders the option to redeem their shares either (i) in connection with a shareholder meeting to approve the business combination or (ii) by means of a tender offer.

Assets held in Trust Accounts relate to gross proceeds received from the IPO and can only be used for the initial business combination and any possible investor redemptions.

If the SPAC is unable to complete a business combination within a specified time frame, typically within 24 months of the IPO close date, the SPACs will redeem all public shares.

The ownership interest in each SPAC which is not owned by the Company is reflected as redeemable equity from consolidated Public SPACs in the accompanying Consolidated Financial Statements (see Note 1 9 ).

The ownership interest of the Company in these SPACs may include Class F ordinary shares, Class G ordinary shares, purchased private placement shares, purchased private placement warrants, earnout shares and warrants and forward purchase agreements (“FPAs”).

The SPACs issue the Company Class F ordinary shares and/or Class G ordinary shares at the formation of the SPAC, typically for an initial contribution of less than $0.1 million, which are convertible into Class A ordinary shares on the first business day following the completion of the business combination.

For SPACs that issue Class G ordinary shares, the Class G ordinary shares will convert into Class A ordinary shares only when the performance condition is probable of occurrence, or more specifically when a business combination is consummated, and only to the extent certain triggering events occur following the closing of the business combination and also upon specified strategic transactions.

The additionally purchased private placement warrants or shares are not redeemable, and will not be transferable, assignable or salable until 30 days after the completion of the business combination.

The Company consolidates these SPACs during the period before the initial business combination, and therefore the Class F ordinary shares, Class G ordinary shares, private placement shares, private placement warrants and FPAs with consolidated related parties are eliminated in consolidation.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

The below table is presented in thousands except units:

SPAC Name (Ticker) (a)

Date of IPO Units Sold Non-Controlling Interests Subject to Possible Redemption as of Public Warrants and Forward Purchase Agreements as of TPG Investments as of (f)

December 31, 2021

AfterNext HealthTech ("AFTR") (b) Aug-21 25,000,000 $ 250,000 $ 5,833 $ 3,292

TPG PACE Beneficial II ("YTPG") (c) Apr-21 40,000,000 400,000 — 25

TPG PACE Beneficial Finance ("TPGY") (d) Oct-20 35,000,000 350,027 7,215 5,048

100,000,000 $ 1,000,027 $ 13,048 $ 8,365

December 31, 2020

TPG PACE Beneficial Finance ("TPGY") (d) Oct-20 35,000,000 $ 350,005 $ 224,299 $ 107,317

TPG PACE Tech Opportunities ("PACE") (e) Oct-20 45,000,000 450,006 38,970 20,592

80,000,000 $ 800,011 $ 263,269 $ 127,909

_______________

(a) Each SPAC is listed on the New York Stock Exchange.

(b) AFTR sold 25,000,000 units at a price of $10.00 per unit for a total IPO price of $250.0 million.

Each unit consists of one Class A ordinary share of AFTR at $0.0001 par value and one-third of one warrant.

Each unit consists of one Class A ordinary share of YTPG at $0.0001 par value.

Prior to the IPO, YTPG entered into FPAs for an aggregate purchase price of $175.0 million.

(d) TPGY sold 35,000,000 units at a price of $10.00 per unit for a total IPO price of $350.0 million.

Each unit consists of one Class A ordinary share of TPGY at $0.0001 par value and one-fifth of one warrant.

Prior to the IPO, TPGY entered into FPAs for an aggregate purchase price of $100.0 million.

In December 2020, a definitive agreement to merge was announced between TPGY and EVBox Group, a leading global provider of smart charging solutions for electric vehicles.

The merger agreement and the business combination were approved by the board of directors of TPGY in December 2020.

On December 29, 2021, TPGY, Dutch Holdco, New SPAC, Engie Seller and EVBox Group entered into a termination of the business combination agreement pursuant to which the parties mutually agreed to terminate the business combination effective as of such date.

As a result of the termination of the business combination, Engie Seller will reimburse TPGY for certain expenses incurred by TPGY in connection with the business combination in an amount of EUR 15.0 million.

TPGY intends to continue to pursue the consummation of a business combination with an appropriate target.

(e) PACE sold 45,000,000 units at a price of $10.00 per unit for a total IPO price of $450.0 million.

Each unit consists of one Class A ordinary share of PACE at $0.0001 par value and one-fifth of one warrant.

Prior to the IPO, PACE entered into FPAs for an aggregate purchase price of $150.0 million.

In January 2021, a definitive agreement to merge was announced between PACE and Nerdy Inc (“NRDY”), a leading platform for delivering live online learning.

The merger agreement and the business combination were approved by the board of directors of PACE in January 2021, and the transaction closed on September 20, 2021.

(f) The Company’s investments, which includes the founder shares, private placement shares, private placement warrants and FPAs held by consolidated affiliates, are eliminated in consolidation.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

In April 2021, TPG PACE Solutions Corp.

(“TPGS”) consummated its $285.0 million IPO.

TPGS sold 28,500,000 units at a price of $10.00 per unit for a total IPO price of $285.0 million.

Each unit consisted of one Class A ordinary share of TPGS at $0.0001 par value.

Prior to the IPO, TPGS entered into FPAs for an aggregate purchase price of $150.0 million.

In July 2021, a definitive agreement to merge was announced between TPGS and Vacasa Holdings, LLC, a leading vacation rental management platform.

The merger agreement and the business combination were approved by the board of directors of TPGS in July 2021.

The merger was consummated on December 7, 2021.

The Company accounts for the Public SPACs outstanding public warrants and FPAs in accordance with the guidance contained in Accounting Standards Codification (“ASC”) 815-40, " Derivatives and Hedging — Contracts on an Entity's Own Equity ,” (“ASC 815”).

The Company accounts for warrants and FPAs that are not indexed to its own stock as liabilities at fair value on the Statements of Financial Condition.

The Company determined that the public warrants do not meet the criteria for equity treatment thereunder.

The FPAs, depending on the underlying securities, can be classified as either equity or liability instruments on the Consolidated Financial Statements.

The warrants and FPAs that are determined to be liability instruments under ASC 815 must be recorded as liabilities and are subject to remeasurement at each balance sheet date and any change in fair value is recorded in the Company’s Consolidated Statements of Operations.

When a consolidated Public SPAC enters into a business combination, the Company assesses whether the respective SPAC should still be consolidated in accordance with ASC 810 — Consolidation (“ASC 810”).

If the Company determines the SPAC should no longer be consolidated, then the associated assets, liabilities, and non-controlling interest are deconsolidated and a gain or loss is recorded in the Consolidated Statements of Operations.

Investments consist of investments in private equity funds, real estate funds, fund of hedge funds, credit funds, including our share of any carried interest, equity method and other proprietary investments.

As of December 31, 2021, the Company no longer consolidates such TPG Funds (see Note 1 to the Consolidated Financial Statements).

Investments consist of investments in private equity funds, real estate funds, hedge funds and credit funds, including our share of any performance allocations and equity method and other proprietary investments.

Investments denominated in currencies other than the U.S.

dollar are valued based on the spot rate of the respective currency at the end of the reporting period with changes related to exchange rate movements reflected in the Consolidated Statements of Operations.

Equity Method – Carried Interests and Capital Interests

Equity Method – Performance Allocations and Capital Interests

Investments in which the Company is deemed to have significant influence, but not control, are accounted for using the equity method of accounting except in cases where the fair value option has been elected.

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The difference between the carrying value and its estimated fair value is recognized as an impairment when the loss is deemed other than temporary.

The TPG Funds are considered investment companies under ASC 946, Financial Services – Investment Companies (“ASC 946”).

The Company, along with the TPG Funds, apply the specialized accounting promulgated in ASC 946 and, as such, neither the Company nor the TPG Funds consolidate wholly-owned, majority-owned and/or controlled Portfolio Companies nor do they record minority investments.

The TPG Funds are considered investment companies under Accounting Standards Codification (“ASC”) Topic 946, Financial Services – Investment Companies (“ASC 946”).

The Company, along with the TPG Funds, applies the specialized accounting promulgated in ASC 946 and, as such, neither the Company nor the TPG Funds consolidate wholly-owned, majority-owned and/or controlled Portfolio Companies.

The TPG Funds record all investments in the Portfolio Companies at fair value.

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The comparability of the identified set of comparable companies to the Portfolio Company, among other factors, is considered in the application of the market approach.

The general partners, depending on the type of investment or stage of the Portfolio Company’s lifecycle, may also utilize a discounted cash flow analysis, an income approach, in combination with the market approach in determining fair

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

value of investments.

The income approach involves discounting projected cash flows of the Portfolio Company at a rate commensurate with the level of risk associated with those cash flows.

In accordance with ASC 820, Fair Value Measurement (“ASC 820”) market participant assumptions are used in the determination of the discount rate.

In accordance with ASC Topic 820, Fair Value Measurement (“ASC 820”) market participant assumptions are used in the determination of the discount rate.

In applying valuation techniques used in the determination of fair value, the general partners assume a reasonable period of time for liquidation of the investment and take into consideration the financial condition and operating results of the underlying Portfolio Company, the nature of the investment, restrictions on marketability, market conditions, foreign currency exposures and other factors.

1 unchanged sentence

Due to the inherent uncertainty of valuations, the fair values reflected in the accompanying Consolidated Financial Statements may differ materially from values that would have been used had a readily available market existed for such investments and may differ materially from the values that may ultimately be realized.

The carrying value of investments classified as Equity Method - Carried Interests and Capital Interests approximates fair value, because the underlying investments of the unconsolidated TPG Funds are reported at fair value.

Notes to Consolidated Financial Statements

Equity Method Investments – Other

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Impairment, if any, is recognized in net gains (losses) from investment activities in the Consolidated Financial Statements.

Investments held by Consolidated TPG Funds

The consolidated TPG Funds are, for U.S.

GAAP purposes, investment companies and reflect their investments at fair value and TPG has retained this specialized accounting for these consolidated funds.

Accordingly, the unrealized gains and losses resulting from changes in fair value of the investments and other financial instruments held by the consolidated TPG Funds are reflected as a component of net gains (losses) from investment activities in the Consolidated Financial Statements.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

Non-Controlling Interests in TPG Group Holdings

Non-Controlling Interests in TPG Group Holdings consist of the following:

• Non-Controlling Interests in Consolidated Funds – The ownership interests in consolidated TPG Funds.

• Other Non-Controlling Interests – The ownership interests in certain consolidated entities other than the consolidated TPG Funds.

Non-Controlling Interests

Non-controlling interests consists of ownership interests held by third-party investors in certain entities that are consolidated, but not 100% owned.

The aggregate of the income or loss and corresponding equity that is not owned by the Company is included in non-controlling interests in the Consolidated Financial Statements.

Allocation of income to non-controlling interest holders is based on the respective entities’ governing documents.

Notes to Consolidated Financial Statements

Revenues consisted of the following (in thousands):

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Total fees and other 1,246,635 977,904 883,366

Carried interests 3,792,861 1,203,520 903,615

Performance allocations 720,106 3,792,861 1,203,520

Capital interests 36,146 205,622 27,952

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Total revenues $ 2,002,887 $ 4,976,387 $ 2,114,838

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

Fees and Other

Fees and other are accounted for as contracts with customers under Accounting Standard Codification (Topic 606):

Revenue from Contracts with Customers (“ASC 606”).

The guidance for contracts with customers provides a five-step framework that requires the Company to (a) identify the contract with a customer, (b) identify the performance obligations in the contract, (c) determine the transaction price, (d) allocate the transaction price to the performance obligations in the contract and (e) recognize revenue when the Company satisfies its performance obligations.

Fees and other are accounted for as contracts with customers under ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”).

The guidance for contracts with customers provides a five-step framework that requires the Company to (i) identify the contract with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract and (v) recognize revenue when the Company satisfies its performance obligations.

In determining the transaction price, the Company includes variable consideration only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized would not occur when the uncertainty associated with the variable consideration is resolved.

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Management Fees

TPG Funds, collateralized loan obligations and other vehicles

TPG Funds, limited partners and other vehicles

Asset management services are satisfied over time (daily) because the customer receives and consumes the benefits of the advisory services daily

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_________________

(a) There were no significant judgements made in evaluating when a customer obtains control of the promised service for performance obligations satisfied at a point in time.

(b) See Note 1 5 for amounts classified in due from affiliates.

(a) There were no significant judgments made in evaluating when a customer obtains control of the promised service for performance obligations satisfied at a point in time.

(b) See Note 1 5 to the Consolidated Financial Statements for amounts classified in due from affiliates.

Management Fees

The Company provides investment management services to the TPG Funds and other vehicles in exchange for a management fee.

The Company provides investment management services to the TPG Funds, limited partners and other vehicles in exchange for a management fee.

Management fees are determined quarterly based on an annual rate and are generally based upon a percentage of the capital committed or capital invested during the investment period.

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After the contract is established, management does not make any significant judgments in determining the transaction price.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

Management fees earned from the TPG Funds generally range from 0.50% to 2.00% of committed capital during the commitment period and from 0.25% to 2.00% of actively invested capital after the commitment period or at an annual rate of fund gross assets, as defined in the respective partnership agreements of the TPG Funds.

Management fees earned generally range from 0.50 % to 2.00 % of committed capital during the commitment period and from 0.25 % to 2.00 % of actively invested capital after the commitment period or at an annual rate of fund gross assets, as defined in the respective partnership agreements of the TPG Funds.

Management fees charged to consolidated TPG Funds and SPACs are eliminated in consolidation.

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The Company provides monitoring services to certain Portfolio Companies in exchange for a fee, which is recognized over time as services are rendered.

Under the terms of the management agreements with certain TPG Funds, a portion of the monitoring fees received from Portfolio Companies may produce Fee Credits, as defined below, which reduce TPG Funds’ management fees due to the Company.

Additionally, certain monitoring fee arrangements may provide for a termination payment following an IPO or change of control as defined in the contractual terms of the related agreement with a Portfolio Company.

These termination payments are recognized at the point in time when the related transaction closes.

For the years ended December 31, 2021, 2020 and 2019, these termination payments are not material to the Company’s Consolidated Financial Statements.

After the monitoring contract is established, there are no significant judgments made in determining the transaction price.

Transaction Fees

The Company provides capital structuring and other advice to Portfolio Companies, third parties and other vehicles generally in connection with debt and equity arrangements, and underwriting and placement services for a fee at a point in time when the underlying advisory services rendered are complete.

The Company provides capital structuring and other advice to Portfolio Companies, third parties and other vehicles generally in connection with debt and equity arrangements, as well as underwriting and placement services for a fee at a point in time when the underlying advisory services rendered are complete.

Transaction fees are separately negotiated for each transaction and are generally based on the underlying transaction value.

After the contract is established, management makes no significant judgements when determining the transaction price.

Under the terms of the management agreements with certain TPG Funds, the Company is required to share with such funds an agreed upon percentage of certain fees, including monitoring and transaction fees earned from Portfolio Companies ("Fee Credits").

Investment funds earn fee credits only with respect to monitoring and transaction fees that are allocable to the fund's investment in the portfolio company and not, for example, any fees allocable to capital invested through co-investment vehicles.

Under the terms of the management agreements with certain TPG Funds, the Company is required to reduce management fees payable by funds by an agreed upon percentage of certain fees, including monitoring and transaction fees earned from Portfolio Companies (“Fee Credits”).

Investment funds receive the benefit of Fee Credits only with respect to monitoring and transaction fees that are allocable to the fund’s investment in the Portfolio Company and not, for example, any fees allocable to capital invested through co-investment vehicles.

Fee Credits are calculated after deducting certain costs incurred in connection with reimbursements of specialized operational services associated with providing specialized operations and consulting services to the funds and Portfolio Companies.

Fee Credits are recognized and owed to investment funds concurrently with the recognition of monitoring fees and transaction fees.

Since Fee Credits are payable to investment funds, amounts owed are generally applied as a reduction of the management fee that is otherwise billed to the investment fund.

Fee Credits are recognized by investment funds concurrently with the recognition of monitoring fees and transaction fees.

Since Fee Credits are payable to investment funds, amounts of Fee Credits are generally applied as a reduction of the management fee that is otherwise billed to the investment fund.

Fee Credits are recorded as a reduction of revenues in the Consolidated Statement of Operations.

Fee Credits owed to investment funds are recorded in due to affiliates in the Consolidated Financial Statements.

See Note 15 .

Fee Credits payable to investment funds are recorded in due to affiliates in the Consolidated Financial Statements.

See Note 1 5 to the Consolidated Financial Statements.

Incentive Fees

The Company provides investment management services to certain TPG funds and other vehicles in exchange for a management fee as discussed above and, in some cases an incentive fee when the Company is not entitled to carried interest, as further discussed below.

The Company provides investment management services to certain TPG funds and other vehicles in exchange for a management fee as discussed above and, in some cases, an incentive fee when the Company is not entitled to performance allocations, as further discussed below.

Incentive fees are considered variable consideration as these fees are subject to reversal, and therefore the recognition of such fees is deferred until the end of the measurement period when the performance-based incentive fees become fixed and determinable.

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In providing investment management and advisory services to TPG funds and monitoring services to the Portfolio Companies, TPG routinely contracts for services from third parties.

In situations where the Company is viewed, for accounting purposes only, as having incurred these third-party costs on behalf of the TPG Funds or Portfolio Companies, the cost of such services are presented net as a reduction of the Company’s revenues.

In all other situations, the expenses and related reimbursements associated with these services are presented on a gross basis, which are classified as part of the Company’s expenses and reimbursements of such costs are classified as expense reimbursements within revenues in the

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

Consolidated Financial Statements.

In situations where the Company is viewed, for accounting purposes only, as having incurred these third-party costs on behalf of the TPG funds or Portfolio Companies, the cost of such services is presented net as a reduction of the Company’s revenues.

In all other situations, the expenses and related reimbursements associated with these services are presented on a gross basis, which are classified as part of the Company’s expenses, and reimbursements of such costs are classified as expense reimbursements within revenues in the Consolidated Financial Statements.

After the contract is established, there are no significant judgments made when determining the transaction price.

Capital Allocation-Based Income

Capital allocation-based income is earned from the TPG Funds when the Company has a general partner’s capital interest and is entitled to a disproportionate allocation of investment income (referred to hereafter as “carried interest”).

The Company records capital allocation-based income under the equity method of accounting assuming the fund was liquidated as of each reporting date pursuant to each TPG Fund's governing agreements.

Notes to Consolidated Financial Statements

Capital Allocation-Based Income (Loss)

Capital allocation-based income (loss) is earned from the TPG Funds when the Company has a general partner’s capital interest and is entitled to a disproportionate allocation of investment income (referred to hereafter as “performance allocations”).

The Company records capital allocation-based income (loss) under the equity method of accounting assuming the fund was liquidated as of each reporting date pursuant to each TPG Fund’s governing agreements.

Accordingly, these general partner interests are accounted for outside of the scope of ASC 606.

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See discussion above regarding “Incentive Fees”.

Carried interest is allocated to the general partner based on cumulative fund performance as of each reporting date, and after specified investment returns to the funds' limited partners are achieved.

At the end of each reporting period, the TPG Funds calculate and allocate the carried interest that would then be due to the general partner for each TPG Fund, pursuant to the TPG Fund governing agreements, as if the fair value of the underlying investments were realized as of such date, irrespective of whether such amounts have been realized.

As the fair value of underlying investments (and the investment returns to the funds’ limited partners) varies between reporting periods, it is necessary to make adjustments to amounts recorded as carried interest to reflect either (a) positive performance resulting in an increase in the carried interest allocated to the general partner or (b) negative performance that would cause the amount due to the general partner to be less than the amount previously recognized, resulting in a negative adjustment to carried interest allocated to the general partner.

In each case, carried interest is calculated on a cumulative basis and cumulative results are compared to amounts previously recorded with a current period adjustment, positive or negative recorded.

The Company ceases to record negative carried interest allocations once previously recognized carried interest allocations for a TPG Fund have been fully reversed, including realized carried interest.

The general partner is not obligated to make payments for guaranteed returns or hurdles of a fund and, therefore, cannot have negative carried interest over the life of a fund.

Accrued but unpaid carried interest as of the reporting date is reflected in investments in the Company’s Consolidated Financial Statements.

Carried interest received by the general partners of the respective TPG Funds is subject to clawback to the extent the carried interest received by the general partner exceeds the amount the general partner is ultimately entitled to receive based on cumulative fund results.

Performance allocations are allocated to the general partners based on cumulative fund performance as of each reporting date, and after specified investment returns to the funds’ limited partners are achieved.

At the end of each reporting period, the TPG Funds calculate and allocate the performance allocations that would then be due to the general partner for each TPG Fund, pursuant to the TPG Fund governing agreements, as if the fair value of the underlying investments were realized as of such date, irrespective of whether such amounts have been realized.

As the fair value of underlying investments (and the investment returns to the funds’ limited partners) varies between reporting periods, it is necessary to make adjustments to amounts recorded as performance allocations to reflect either (i) positive performance resulting in an increase in the performance allocations allocated to the general partner or (ii) negative performance that would cause the amount due to the general partner to be less than the amount previously recognized, resulting in a negative adjustment to performance allocations allocated to the general partner.

In each case, performance allocations are calculated on a cumulative basis and cumulative results are compared to amounts previously recorded with a current period adjustment, positive or negative, recorded.

The Company ceases to record negative performance allocations once previously recognized performance allocations for a TPG Fund have been fully reversed, including realized performance allocations.

The general partner is not obligated to make payments for guaranteed returns or hurdles of a fund and, therefore, cannot have negative performance allocations over the life of a fund.

Accrued but unpaid performance allocations as of the reporting date are reflected in investments in the Company’s Consolidated Financial Statements.

Performance allocations received by the general partners of the respective TPG Funds are subject to clawback to the extent the performance allocations received by the general partner exceed the amount the general partner is ultimately entitled to receive based on cumulative fund results.

Generally, the actual clawback liability does not become due until eighteen months after the realized loss is incurred;

however, individual fund terms vary.

For disclosures at December 31, 2021 related to clawbacks, see Note 1 7 .

Revenue related to carried interest for consolidated TPG Funds is eliminated in consolidation.

For disclosures at December 31, 2022 related to clawback, see Note 1 8 to the Consolidated Financial Statements.

Revenue related to performance allocations for consolidated TPG Funds is eliminated in consolidation.

The Company earns management fees, incentive fees and capital allocation-based income (loss) from investment funds and other vehicles whose primary focus is making investments in specified geographical locations and earns transaction and monitoring fees from portfolio companies located in varying geographies.

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The carrying value of equity method investments in proprietary investments where the Company exerts significant influence is generally determined based on the amounts invested, adjusted for the equity in earnings or losses of the investee allocated based on the Company’s ownership percentage, less distributions and any impairment.

TPG Group Holdings (SBS), L.P.

The Company records its proportionate share of investee’s equity in earnings or losses based on the most recently available financial

Notes to Consolidated Financial Statements

records its proportionate share of investee’s equity in earnings or losses based on the most recently available financial information, which in certain cases may lag the date of TPG’s financial statements by up to three calendar months.

information, which in certain cases may lag the date of TPG’s financial statements by up to three calendar months.

Income from equity method investments is recorded in net gains (losses) from investment activities on the Consolidated Statements of Operations.

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Net gains (losses) from investment activities of consolidated TPG Funds and Public SPACs

Net gains (losses) from investment activities includes realized gains and losses from the sale of equity, securities sold and not yet purchased, debt and derivative instruments other than warrants and FPAs, and unrealized gains and losses from changes in the fair value of such instruments.

Net gains (losses) from investment activities includes realized gains and losses from the sale of equity, securities sold and not yet purchased, debt and derivative instruments other than warrants and forward purchase agreements (“FPAs”), and unrealized gains and losses from changes in the fair value of such instruments.

Realized gains and losses are recognized on the date the transaction is completed.

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Compensation and Benefits

Compensation and benefits expense includes salaries, bonuses and benefits paid and payable.

Cash-based compensation and benefits includes (i) salaries and wages, (ii) benefits and (iii) discretionary cash bonuses.

Bonuses are accrued over the service period to which they relate.

As a result of operating as a partnership, all carried interest payments in the form of legal form equity made to the Company’s partners are paid pro rata based on ownership percentages in the underlying investment partnership and are accounted for as distributions on the equity held by such partners rather than as compensation and benefits expense.

Compensation expense related to the issuance of equity-based awards is measured at grant-date fair value.

Compensation expense for awards that vest over a future service period is recognized over the relevant service period on a straight-line basis.

Compensation expense for awards that do not require future service is recognized immediately.

Compensation expense for awards that contain market and service conditions is based on grant-date fair value that factors in the probability that the market conditions will be achieved and is recognized on a tranche by tranche basis using the accelerated attribution method.

The requisite service period for those awards is the longer of the explicit service period and

Notes to Consolidated Financial Statements

the derived service period.

The Company recognizes equity-based award forfeitures in the period they occur as a reversal of previously recognized compensation expense.

Prior to the IPO, all performance allocation payments in the form of legal form equity made to the Company’s partners were paid pro rata based on ownership percentages in the underlying investment partnership and accounted for as distributions on the equity held by such partners during such period.

For the period in 2022 prior to the IPO, there were no performance allocations earned, allocated or distributed with respect to partnership interests.

Performance allocation compensation expense and accrued performance allocation compensation is the portion of performance allocations that TPG allocates to certain of its employees and certain other advisors of the Company.

Performance allocations due to our partners and professionals are accounted for as compensation expense in conjunction with the recognition of the related performance allocations and, until paid, are recognized as accrued performance allocation compensation.

Accordingly, upon a reversal of performance allocations, the related compensation expense, if any, is also reversed.

Net Income (Loss) Per Share of Class A Common Stock

Basic income (loss) per share of Class A common stock is calculated by dividing net income (loss) attributable to TPG Inc.

by the weighted-average shares of Class A common stock, unvested participating shares of Class A common stock outstanding for the period and vested deferred restricted shares of Class A common stock that have been earned for which issuance of the related shares of Class A common stock is deferred until future periods.

Diluted income (loss) per share of Class A Common Stock reflects the impact of all dilutive securities.

Unvested participating shares of common stock are excluded from the computation in periods of loss as they are not contractually obligated to share in losses.

The Company applies the treasury stock method to determine the dilutive weighted-average common shares represented by the unvested restricted stock units.

The Company applies the if-converted method to the TPG Operating Group partnership units to determine the dilutive impact, if any, of the exchange right included in the TPG Operating Group partnership units.

Cash, Cash Equivalents and Restricted Cash

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Restricted cash balances relate to cash balances reserved for the payment of interest on the Company’s secured borrowings.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

Cash and Cash Equivalents Held by Consolidated TPG Funds and Public SPACs

Cash and cash equivalents held by consolidated TPG Funds and Public SPACs represent cash and cash equivalents that are held by consolidated TPG Funds and Public SPACs and not available to fund the general liquidity needs of the Company.

Cash and Cash Equivalents Held by Consolidated Public SPACs

Cash and cash equivalents held by consolidated Public SPACs represent cash and cash equivalents that are held by consolidated Public SPACs and are not available to fund the general liquidity needs of the Company.

Assets Held in Trust Accounts

Proceeds from equity issued by certain consolidated TPG Funds and Public SPACs have been deposited into trust accounts (“Trust Accounts”) and may only be utilized for specific purposes.

Proceeds from equity issued by certain consolidated Public SPACs have been deposited into trust accounts (“Trust Accounts”) and may only be utilized for specific purposes.

Therefore, such cash and investments are reported separately in assets held in Trust Accounts on the Consolidated Statements of Financial Condition.

As of December 31, 2021, AFTR and YTPG assets held in the Trust Accounts were deposited into a non-interest-bearing U.S.

based trust account.

As of December 31, 2020, no assets held in the Trust Accounts were deposited into a non-interest-bearing U.S.

based trust account.

As of December 31, 2021 and 2020 TPGY assets held in the Trust Accounts were invested in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S.

government treasury obligations.

As of December 31, 2020, PACE assets held in the Trust Accounts were invested in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S.

As of December 31, 2022 and December 31, 2021, TPG Pace Beneficial II Corp.

(“YTPG”) assets held in Trust Accounts were deposited into a non-interest-bearing U.S.

based account.

As of December 31, 2022, AfterNext HealthTech Acquisition Corp.

(“AFTR”) assets held in Trust Accounts were invested in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act, which invest only in direct U.S.

government treasury obligations.

Due from and Due to Counterparty and Derivative Liabilities of Public SPACs

Certain TPG Funds enter into derivative contracts with another party (“Counterparty”) in the normal course of conducting their investment activities.

Net amounts due to or due from the Counterparty, based on the derivatives’ fair values, are periodically settled in cash and such amounts are reflected in due from and due to counterparty in the Consolidated Financial Statements.

The payments received or paid on individual derivative transactions and unrealized gains and losses recognized are included in net gains (losses) from investment activities.

From time to time collateral may be pledged to or obtained from a Counterparty to ensure that the Company and the Counterparty will be able to fulfill their contractual obligations.

Such collateral amounts are included in due from and due to counterparty in the Consolidated Statements of Financial Condition.

Financial derivative assets and liabilities related to our consolidated TPG Funds and Public SPACs’ investment activities may consist of the following instruments:

• Total return swaps which are used to manage the risk of adverse movements in both credit and market risk

• Interest rate swaps and futures which are used to hedge against the risk that interest rates will move in an adverse direction

• Options which are used to manage price volatility

• Foreign currency forwards which are used to manage the foreign exchange risk associated with certain foreign currency-denominated assets and liabilities

• Credit default swaps which are used to manage the counterparty credit risk associated with loans and lending related commitments

• Warrant liabilities

• Forward purchase agreements

TPG Group Holdings (SBS), L.P.

As of December 31, 2021, these assets were deposited into a non-interest-bearing U.S.

based trust account.

Notes to Consolidated Financial Statements

Derivative Liabilities of Public SPACs

Financial derivative assets and liabilities related to our consolidated Public SPACs’ investment activities consist of warrant liabilities and forward purchase agreements.

The Company recognizes these derivative instruments as assets or liabilities at fair value in the accompanying Consolidated Financial Statements.

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These derivative contracts are not designated as hedging instruments for accounting purposes.

These derivatives are agreements in which a consolidated TPG Fund and a Counterparty agree to exchange cash flows based on agreed-upon terms.

These derivatives are agreements in which a consolidated Public SPAC and a counterparty agree to exchange cash flows based on agreed-upon terms.

As a result of the derivative transaction, the Company is exposed to the risk that counterparties will fail to fulfill their contractual obligations.

To mitigate such counterparty risk, the applicable TPG Fund only enters into contracts with major financial institutions, all of which have investment grade ratings.

To mitigate such counterparty risk, the applicable Public SPAC only enters into contracts with major financial institutions, all of which have investment grade ratings.

Counterparty credit risk is evaluated in determining the fair value of the derivative instruments.

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The master netting agreements provide the Company and the counterparty the right to liquidate collateral and the right to offset each other’s obligations in the event of default by either party.

The Company’s consolidated Public SPACs may issue public warrants and FPAs in conjunction with their IPO.

Certain of the Company’s consolidated Public SPACs issued public warrants and FPAs in conjunction with their IPO.

The Company accounts for warrants and FPAs of the consolidated Public SPAC’s ordinary shares that are not indexed to its own stock as liabilities at fair value on the balance sheet.

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Investments with readily available quoted prices or for which fair value can be measured from quoted prices in active markets will typically have a higher degree of input observability and a lesser degree of judgment applied in determining fair value.

Notes to Consolidated Financial Statements

The three levels of the fair value hierarchy under ASC 820 are as follows:

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The types of investment generally included in Level I are publicly listed equities, debt and securities sold, not yet purchased.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

Level II – Pricing inputs are other than quoted prices included within Level I that are observable for the investment, either directly or indirectly.

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Financial assets and financial liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

Except for secured borrowings, the fair value of the Company’s assets and liabilities, including our Senior Unsecured Term Loan, which qualify as financial instruments under ASC 820, approximates the carrying amounts represented in the Consolidated Statements of Financial Condition due to their short-term nature and in the case of our Senior Unsecured Term Loan due to its recent issuance in December 2021 and variable rate nature.

At December 31, 2021 and 2020, the estimated fair value of the secured borrowings based on current market rates and credit spreads for debt with similar maturities was $271.6 million and $275.1 million, respectively, and the carrying value, excluding unamortized issuance costs, was $250.0 million at both December 31, 2021 and 2020.

Due from and Due to Affiliates

The Company considers current and former limited partners of funds and employees, including their related entities, entities controlled by the Company’s founders (“Founders”) but not consolidated by the Company, Portfolio Companies of

TPG Group Holdings (SBS), L.P.

See Note 12 to the Consolidated Financial Statements.

Notes to Consolidated Financial Statements

TPG Funds, and unconsolidated TPG Funds to be affiliates (“Affiliates”).

Due from and Due to Affiliates

The Company considers current and former limited partners of funds and employees, including their related entities, entities controlled by the Company’s Founders but not consolidated by the Company, Portfolio Companies of TPG Funds, and unconsolidated TPG Funds to be affiliates (“Affiliates”).

Receivables from and payables to affiliates are recorded at their expected settlement amount in due from and due to affiliates in the Consolidated Financial Statements.

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Goodwill is not amortized.

At least annually, management assesses whether goodwill is impaired.

Management assesses whether an impairment exists by comparing the fair value of each of its reporting units to its carrying value, including goodwill.

Goodwill is reviewed for impairment at least annually utilizing a qualitative or quantitative approach, and more frequently if circumstances indicate impairment may have occurred.

The impairment testing for goodwill under the qualitative approach is based first on a qualitative assessment to determine if it is more likely than not that the fair value of the Company’s reporting unit is less than its respective carrying value.

If it is determined that it is more likely than not that a reporting unit’s fair value is less than its carrying value, the Company performs a quantitative analysis.

When the quantitative approach indicates an impairment, an impairment loss is recognized to the extent by which the carrying value exceeds the fair value, not to exceed the total amount of goodwill.

As of December 31, 2022, we believe it is more likely than not that the fair value of our reporting unit exceeds its carrying value.

Intangible assets

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Finite-lived intangible assets are amortized over their estimated useful lives, which range from five to twelve years , and are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the intangible asset may not be recoverable.

Amortization expense is included in depreciation and amortization expense in the Consolidated Statements of Operations.

Operating Leases

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The Company has elected the short-term lease expedient.

A short-term lease is a lease that, as of the commencement date, has a lease term of 12 months or less and does not include an option to purchase the underlying asset that the lessee is reasonably certain to exercise.

For such leases, the Company will not apply the recognition requirements of ASC 842, Leases (“ASC 842”) and instead will recognize the lease payments as lease cost on a straight-line basis over the lease term.

A short-term lease is a lease that, as of the commencement date, has a lease term of 12 months or less and does not include an option to purchase the underlying

Notes to Consolidated Financial Statements

asset that the lessee is reasonably certain to exercise.

For such leases, the Company will not apply the recognition requirements of ASC Topic 842, Leases (“ASC 842”) and instead will recognize the lease payments as lease cost on a straight-line basis over the lease term.

Additionally, the Company elected the practical expedient which allows an entity to not reassess whether any existing land easements are or contain leases.

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Additionally, the Company’s leases do not contain restrictions or covenants that restrict the Company from incurring other financial obligations.

The Company also does not provide any residual value guarantees for the leases or have any significant leases that have yet to

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

be commenced.

The Company also does not provide any residual value guarantees for the leases or have any significant leases that have yet to be commenced.

From time to time, the Company enters into certain sublease agreements that have terms similar to the remaining terms of the master lease agreements between TPG and the landlord.

Sublease income is recorded as an offset to general, administrative and other in the accompanying Consolidated Statements of Operations.

In response to the COVID-19 pandemic, the FASB provided relief under ASC 842.

In response to the COVID-19 pandemic, the Financial Accounting Standards Board (“FASB”) provided relief under ASC 842.

Under this relief, companies can make a policy election on how to treat lease concessions resulting directly from the COVID-19 pandemic, provided that the modified contracts result in total cash flows that are substantially the same or less than the cash flows in the original contract.

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The Company records accruals for deferred rental payments and recognizes rent abatements or concessions as variable lease costs in the periods incurred.

Operating lease expense is recognized on a straight-line basis over the lease term and is recorded within general, administrative and other in the accompanying Consolidated Statements of Operations (See Note 1 6 ).

Fixed assets consist primarily of leasehold improvements, furniture, fixtures and equipment, computer hardware and software and other fixed assets which are recorded at cost, less accumulated depreciation.

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Foreign currency gains and losses resulting from transactions in currencies other than the functional currency are also included in general, administrative and other in the Consolidated Statements of Operations during the period the transaction occurred.

Securities Sold, Not Yet Purchased

Securities sold, not yet purchased consist of securities that certain TPG Funds have borrowed and sold or sold short.

The TPG Funds are required to “cover” the short sale in the future by purchasing the security at prevailing market prices and delivering it to the counterparty from which it borrowed the security.

The cost of that security is adjusted by brokerage commissions and any premiums charged by the lender of the security.

The TPG Funds are exposed to loss in the event that the price at which a security may have to be purchased to cover a short sale exceeds the price at which the borrowed security was sold short.

The security is carried at fair value based upon the closing price as it customarily ascertained by the “principal market,” as defined by ASC 820 in which such investments are traded, or if no “principal market” exists, the “most advantageous market”, as of the last business day of the reporting period.

If no sale occurs on the last business day of the reporting period, Management may refer to the price at which the last trade occurred in such instrument or such other inputs or methodologies as Management believes is appropriate in its determination of fair value.

The TPG Funds’ investments and amounts due from counterparties may be partially pledged as collateral for securities sold, not yet purchased, and margin requirements.

The collateral is released upon entering a closing transaction.

Certain of these amounts accrue interest at negotiated rates.

Any change in value is included in net gains (losses) from investment activities in the Consolidated Financial Statements.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

Redeemable Equity from Consolidated Public SPACs

Redeemable equity from consolidated Public SPACs represents the shares issued by the Company’s consolidated Public SPACs that are redeemable for cash by the public shareholders in the event of an election to redeem by individual public shareholders at the time of the business combination.

Additionally, these shares become automatically redeemable with the Public SPAC’s failure to complete a business combination, tender offer, or stockholder approval provisions.

The Company accounts for redeemable equity in accordance with ASC 480-10-S99, Distinguishing Liabilities from Equity (“ASC 480-10-S99”), which states redemption provisions not solely within the control of the Company require ordinary shares subject to redemption to be classified outside of permanent equity.

The Company accounts for redeemable equity in accordance with ASC Topic 480-10-S99, Distinguishing Liabilities from Equity (“ASC 480”), which states redemption provisions not

Notes to Consolidated Financial Statements

solely within the control of the Company require ordinary shares subject to redemption to be classified outside of permanent equity.

The redeemable non-controlling interests are initially recorded at their original issuance price and are subsequently allocated their proportionate share of the underlying gains or losses of the Public SPACs.

The Company adjusts the redeemable equity to full redemption value on a quarterly basis.

The Company and its subsidiaries are primarily comprised of partnerships and other “pass-through entities” not subject to income tax.

As a pass-through entity, each partner or member therein is responsible for income taxes related to income or loss based on their respective share of an entity’s income and expenses.

Certain consolidated subsidiaries are subject to taxation in the U.S.

If a Public SPAC is unable to complete a business combination within the time period required by its governing documents, this equity becomes redeemable and is reclassified out of redeemable equity and into Public SPAC current redeemable equity in accordance with ASC 480 as the Public SPAC prepares for dissolution.

As a result of the Reorganization, the Company is treated as a corporation for U.S.

federal and state income tax purposes.

The Company is subject to U.S.

federal and state income taxes, in addition to local and foreign income taxes, with respect to our allocable share of taxable income generated by the TPG Operating Group partnerships.

Prior to the Reorganization and the IPO, the Company was treated as a partnership for U.S.

federal income tax purposes and therefore was not subject to U.S.

federal and state income taxes except for certain consolidated subsidiaries that were subject to taxation in the U.S.

(federal, state and local) and foreign jurisdictions as a result of their entity classification for tax reporting purposes.

The provision for income taxes in the historical Consolidated Statements of Operations consists of U.S.

(federal, state and local) and foreign income taxes with respect to certain consolidated subsidiaries.

Deferred tax assets and liabilities are recognized for future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases.

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The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period in which the enactment date occurs.

Under ASC 740, Income Taxes (“ASC 740”), a valuation allowance is established when management believes it is more likely than not that a deferred tax asset will not be realized.

The Company’s policy is to recognize accrued interest and penalties related to uncertain tax positions in income tax expense in the Consolidated Financial Statements.

At December 31, 2021 and 2020, the Company did not have a liability recorded for payment of interest and penalties associated with uncertain tax positions as such amounts are not material to the Consolidated Financial Statements.

We operate our business in a single operating and reportable segment, consistent with how our chief operating decision maker reviews financial performance and allocates resources.

We operate collaboratively across product lines with a single expense pool.

Under ASC Topic 740, Income Taxes , a valuation allowance is established when management believes it is more likely than not that a deferred tax asset will not be realized.

The realization of deferred tax assets is dependent on the amount of our future taxable income.

When evaluating the realizability of deferred tax assets, all evidence (both positive and negative) is considered.

This evidence includes, but is not limited to, expectations regarding future earnings, future reversals of existing temporary tax differences and tax planning strategies.

Tax laws are complex and subject to different interpretations by the taxpayer and respective governmental taxing authorities.

Significant judgment is required in determining tax expense and in evaluating tax positions including evaluating uncertainties.

The Company reviews its tax positions quarterly and adjusts its tax balances as new information becomes available.

The Company recognizes interest and penalties relating to unrecognized tax benefits as income tax expense (benefit) within the Consolidated Statement of Operations.

The Company operates its business in a single operating and reportable segment, consistent with how its chief operating decision maker reviews financial performance and allocates resources.

The Company operates collaboratively across product lines with a single expense pool.

Regulated Entities

At December 31, 2022, the Company consolidates a registered broker-dealer subsidiary that is subject to the minimum net capital requirements of the SEC and FINRA which may restrict the Company’s ability to withdraw funds from the broker-dealer.

The broker-dealer has continuously operated in excess of its minimum net capital requirements.

Certain other U.S.

entities are subject to various investment adviser, commodity pool operator and trader regulations.

This includes a number of U.S.

entities that are registered as investment advisers with the SEC.

Notes to Consolidated Financial Statements

Recent Accounting Pronouncements

In March 2020, the FASB issued Accounting Standard Update (“ASU”) 2020-04, Reference Rate Reform (Topic 848):

In June 2022, the FASB issued Accounting Standard Update (“ASU”) 2022-03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions (“ASU 2022-03”) which (1) clarifies the guidance in ASC 820 on the fair value measurement of an equity security that is subject to a contractual sale restriction and (2) requires specific disclosures related to such an equity security.

Under current guidance, stakeholders have observed diversity in practice related to whether contractual sale restrictions should be considered in the measurement of the fair value of equity securities that are subject to such restrictions.

The amendments in ASU 2022-03 should be applied to equity securities with a contract containing a sale restriction that is executed or modified on or after the adoption date.

For equity securities with a contract containing a sale restriction that was executed before the adoption date, companies should continue to apply the historical accounting policy for measuring such securities until the contractual restriction expires or is modified.

This ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within those fiscal years, with early adoption permitted.

The Company does not expect the adoption of ASU 2022-03 to have a material impact to its Consolidated Financial Statements.

Recently Adopted Accounting Guidance

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740):

Simplifying the Accounting for Income Taxes .

The amendments in this update simplify the accounting for income taxes by removing certain exceptions to the general principles in Topic 740.

The amendments also improve consistent application of and simplify GAAP for other areas of Topic 740 by clarifying and amending existing guidance.

ASU 2019-12 is effective for public entities for annual reporting periods beginning after December 15, 2020 and interim periods within those reporting periods, with early adoption permitted.

For all other entities, the amendments are effective for fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022.

The Company adopted ASU 2019-12 on January 1, 2022.

Based on the Company’s existing application of ASC 740, the new guidance did not have a material impact on the Company’s consolidated financial statements.

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848):

Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”).

ASU 2020-04 provides optional expedients and exceptions to U.S.

GAAP requirements for modifications to debt agreements, leases, derivatives, and other contracts, related to the expected market transition from LIBOR, and certain other floating rate benchmark indices, or collectively, IBORs, to alternative reference rates.

GAAP requirements for modifications to debt agreements, leases, derivatives, and other contracts related to the expected market transition from the London Interbank Offered Rate (“LIBOR”), and certain other floating rate benchmark indices to alternative reference rates.

ASU 2020-04 generally considers contract modifications related to reference rate reform to be an event that does not require contract remeasurement at the modification date nor a reassessment of a previous accounting determination.

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This ASU provides optional guidance for a limited period of time to ease the burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting.

These optional expedients and exceptions are effective as of March 12, 2020 through December 31, 2022.

These optional expedients and exceptions are effective as of March 12, 2020 through June 2023.

Adoption is permitted at any time.

For the year ended December 31, 2021, the Company has not elected to apply the temporary optional expedients and exceptions and will be reevaluating the application each quarter.

TPG Group Holdings (SBS), L.P.

The Company elected to apply the optional expedient for contract modifications this year in conjunction with the amendments to its credit facilities as further described in Note 12 to the Consolidated Financial Statements.

In August 2020, the FASB issued ASU 2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815 – 40) (“ASU 2020-06”).

ASU 2020-06 simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity.

The ASU’s amendments are effective for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years.

The Company’s adoption of ASU 2020-06 on January 1, 2022 did not have a material impact to its Consolidated Financial Statements.

Notes to Consolidated Financial Statements

In May 2021, the FASB issued ASU No.

2021-04, Earnings Per Share (Topic 260), Debt – Modifications and Extinguishments (Subtopic 470-50), Compensation – Stock Compensation (Topic 718), and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40):

In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt – Modifications and Extinguishments (Subtopic 470-50), Compensation – Stock Compensation (Topic 718), and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40):

Issuer’s Accounting for Certain Modification or Exchanges of Freestanding Equity-Classified Written Call Options (“ASU 2021-04”).

This ASU provides guidance on how an issuer would measure and recognize the effect of these transactions.

Specifically, it provides a principles-based framework to determine whether an issuer should recognize the modification or exchange as an adjustment to equity or an expense.

ASU 2021-04 will be effective for fiscal years beginning after December 15, 2021 and interim periods within those fiscal years.

The amendments in this ASU affect all entities that issue freestanding written call options that are classified in equity, particularly when a freestanding equity-classified written call option is modified or exchanged and remains equity-classified after the modification or exchange.

ASU 2021-04 is effective for fiscal years beginning after December 15, 2021 and interim periods within those fiscal years.

Early adoption is permitted.

This ASU will be applied prospectively to modifications or exchanges occurring on or after the effective date of the ASU.

The Company is currently evaluating the impact this new guidance will have on its Consolidated Financial Statements.

Recently Adopted Accounting Guidance

In August 2018, the FASB issued ASU No.

2018-15, Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (“ASU 2018-15”), which addresses a customer’s accounting for implementation costs incurred in a cloud computing arrangement (“CCA”) that is a service contract.

The ASU aligns the accounting for costs incurred to implement a CCA that is a service arrangement with the guidance on capitalizing costs associated with developing or obtaining internal-use software.

ASU 2018-15 is effective for annual reporting periods after December 15, 2020 and interim periods within annual periods after December 15, 2021.

The Company adopted this ASU in January 2021 with no material impact to its Consolidated Financial Statements.

Acquisition of NewQuest

This ASU is applied prospectively to modifications or exchanges occurring on or after the effective date of the ASU.

The Company has no written call options classified in equity and as a result, the adoption of ASU 2021-04 did not have any impact to its Consolidated Financial Statements.

On July 1, 2021 (the “Acquisition Date”), the Company completed the acquisition (the “Acquisition”) of the controlling interests with governance rights of NewQuest Holdings (Cayman) Limited (“NQ Manager”) and NewQuest Partners Master G.P.

(“NQ GP”), (collectively “NewQuest”).

(“NQ GP” and, together with NQ Manager, “NewQuest”).

The Company initially acquired a 33.3 % interest (the “Tranche 1”) in NewQuest in July 2018, which was presented as an equity method investment within investments on the Consolidated Statements of Financial Condition.

On the Acquisition Date, the Company acquired the governance rights of NewQuest and an additional 33.3 % of NQ Manager (the “Tranche 2”) for $ 38.0 million, bringing the Company’s total ownership in NQ Manager to 66.7 % and NQ GP to 33.3 %.

Management believes that the Acquisition provides the Company with an opportunity to benefit from scale and expansion of its footprint in the Asia markets and synergies that can be achieved subsequent to the Acquisition.

The operating results of NewQuest have been included in our Consolidated Financial Statements since the Acquisition Date.

The Acquisition was accounted for as a business combination under ASC 805, Business Combinations ("ASC 805") that was achieved in stages.

The operating results of NewQuest have been included in the Company’s Consolidated Financial Statements since the Acquisition Date.

The Acquisition was accounted for as a business combination under ASC Topic 805, Business Combinations (“ASC 805”) that was achieved in stages.

As a result of the change of control, the Company was required to remeasure its pre-existing equity investment in NewQuest at fair value prior to consolidation.

The Company estimated the fair value of its 33.3 % pre-existing investment in NewQuest to be approximately $ 155.4 million.

The remeasurement resulted in the recognition of a pretax gain of $95.0 million, which is presented within net gains (losses) from investment activities on the Consolidated Statements of Operations.

The remeasurement resulted in the recognition of a pre-tax gain of $ 95.0 million, which is presented within net gains (losses) from investment activities on the Consolidated Statements of Operations.

The consideration paid to acquire Tranche 2 consisted of $ 5.0 million in cash, contingent consideration valued at $ 8.4 million and equity interests of the acquirer valued at $ 24.6 million.

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The fair value measurement of the Company's contingent consideration was determined using a discounted cash flow model and Level III inputs and the information provided by the Company’s management of the likelihood of achieving earnout, discounted at a rate of 12.5 %.

The Company believes that it is probable that it will meet the conditions for contingent consideration.

At December 31, 2022, the Company believes that it is probable that it will meet the conditions for the first contingent payment.

The Company no longer believes that the conditions for the second payment will be met which resulted in a $ 4.2 million reduction of the contingent liability during the year ended December 31, 2022, recorded in general, administrative and other on the Consolidated Statements of Operations.

The equity interests of the acquirer issued as consideration include a minority interest of 0.08 % in the Holding Companies valued at $ 5.8 million at the Acquisition Date and minority interests in select businesses ranging from 4.2 % to 4.7 % valued at $ 18.8 million in the aggregate at the Acquisition Date.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

The following table summarizes the fair value of the consideration transferred or to be transferred to acquire NewQuest (in thousands):

The following table summarizes the fair value of the consideration transferred to acquire NewQuest (in thousands):

Cash paid $ 5,000

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Certain of these estimates are material.

The fair values are based on estimates and assumptions from data currently available and were determined using a discounted cash flow model and Level III inputs, which includes estimates of future cash flows for carried interests and fee related earnings over a specific earning period, at a discount rate that ranges between 12.5% - 25.0%, and estimated economic lives.

The fair values are based on estimates and assumptions from data currently available and were determined using a discounted cash flow model and Level III inputs, which includes estimates of future cash flows for performance fee allocations and fee related earnings over a specific earning period, at a discount rate that ranges between 12.5 % - 25.0 %, and estimated economic lives.

Total purchase consideration $ 494,589

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Other assets 5,805

Carried interests 80,278

Performance fee allocations 80,278

Capital interests 28,389

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Intangible assets

Contractual carried interests 132,600

Contractual performance fee allocations 132,600

Management contracts 20,000

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The Company recorded goodwill on its books, which is included in other assets on the Consolidated Statements of Financial Condition.

As of December 31, 2021, approximately $5.0 million of goodwill is deductible for income tax purposes.

As of December 31, 2021, approximately $ 5.0 million of goodwill was deductible for income tax purposes.

Goodwill is primarily attributable to the scale, skill sets, operations, and synergies that can be achieved subsequent to the Acquisition.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

The fair value and weighted average estimated useful lives of identifiable intangible assets acquired in the Acquisition and recorded in other assets on the Consolidated Statements of Financial Condition consist of the following:

Fair Value Average Useful Life

($ in thousands) (in years)

Contractual carried interests $ 132,600 6.7

Contractual performance fee allocations $ 132,600 6.7

Management contracts 20,000 3.5

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Total Intangible Assets $ 177,600

Finite-lived intangible assets were as follows (in thousands) as of December 31, 2021:

Gross Carrying Value Additions Accumulated Amortization Net Carrying Value

Contractual carried interests $ — $ 132,600 $ (10,002) $ 122,598

Management contracts — 20,000 (3,126) 16,874

Investor relationships — 25,000 (1,042) 23,958

$ — $ 177,600 $ (14,170) $ 163,430

The following table presents our estimate of remaining amortization expense for intangible assets that existed as of December 31, 2021 (in thousands):

2022 $ 28,339

Thereafter 36,117

Total $ 163,430

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

Revenue, expense and net income (loss) of NewQuest included in the accompanying Consolidated Statements of Operations from the Acquisition Date through December 31, 2021 were as follows (in thousands):

Fees and other $ 13,678

Capital allocation-based income 30,659

Total revenues 44,337

Total expenses 25,369

Net income $ 18,968

Net income attributable to controlling interests $ 3,963

Net income attributable to other non-controlling interests 15,005

The following pro forma information presents a summary of the Company’s Consolidated Statements of Operations for the years ended December 31, 2021 and 2020, as if the acquisition was completed as of January 1, 2020 (in thousands):

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Net income attributable to controlling interests 2,015,113 927,495

In December 2021, the Company signed an agreement to acquire the remaining 33.3% interest in NQ Manager in exchange for equity interests in the Company.

The Company closed the transaction in January 2022.

Management has not yet completed the analyses needed to estimate the impact to the Consolidated Financial Statements.

In January 2022, the Company completed its acquisition of the remaining 33.3 % interest in NQ Manager in exchange for equity interests in the Company, which consisted of 1,638,866 shares of Class A common stock and 1,072,998 Common Units of the TPG Operating Group.

All of the granted equity interests are subject to a three-year service vesting condition and as such, will be recognized on a straight-line basis as post-combination compensation expense.

The effect of the acquisition was a reallocation of equity between controlling and non-controlling interest of $ 33.6 million.

This transaction was an acquisition under common control in which no gain or loss was recognized.

Notes to Consolidated Financial Statements

Investments consist of the following (in thousands):

Equity method - carried interests $ 5,366,694 $ 3,451,863

Equity method - performance allocations $ 4,677,017 $ 5,366,694

Equity method - capital interests (includes assets pledged of $ 475,110 and $ 492,276 )

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Equity method - fair value option 20,907 46,013

Equity method - other 7,778 621,831

Equity investments 12,072 97,899

Equity method - other 11,908 7,778

Total investments $ 5,329,868 $ 6,109,046

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

Net gains (losses) from carried interests and capital interests are disclosed in the Revenue section of Note 2 .

The following table summarizes net gains (losses) from investment activities (in thousands):

Net gains (losses) from performance allocations and capital interests are disclosed in the Revenue section of Note 2 t o the Consolidated Financial Statements.

The following table summarizes net (losses) gains from investment activities (in thousands):

Year Ended December 31,

2022 2021 2020

Net gains (losses) from investment activities

Net gains (losses) of equity method investments, fair value option (a)

Net (losses) gains from investment activities

Net (losses) gains of equity method investments, fair value option (a)

$ ( 25,106 ) $ 45,435 $ ( 32,170 )

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802 230,186 31,027

Net gains (losses) from equity investments (c) (d)

77,598 (4,696) 44,910

Total net gains (losses) from investment activities $ 353,219 $ (5,839) $ 71,694

Gain on deconsolidation (e)

Net (losses) gains from equity investments (c)

( 85,827 ) 77,598 ( 4,696 )

(a) In September 2021, the Company completed a business combination which resulted in a gain on deconsolidation of TPG PACE Tech Opportunities in an amount of $122.7 million.

(b) Includes pretax gain of $95.0 million on remeasurement of the Company’s pre-existing equity investment in NewQuest at fair value prior to consolidation.

(c) In December 2021, the Company completed a business combination which resulted in a gain on deconsolidation of TPG Pace Solutions’ in an amount of $109.9 million.

(d) In November 2019, the Company completed a business combination which resulted in a gain on deconsolidation of TPG Pace Holdings in an amount of $46.2 million.

(e) On May 1, 2020, the Company deconsolidated the assets, liabilities, and partners’ capital of the Former Affiliate and remeasured the retained investment in the Former Affiliate at fair value and recognized a gain of $401.7 million.

The following table presents the supplemental cash flow disclosures from activities related to deconsolidation of previously consolidated TPG Funds and Public SPACs (in thousands):

Year Ended December 31,

Total net (losses) gains from investment activities $ ( 110,131 ) $ 353,219 $ ( 5,839 )

Gain on deconsolidation (d)

$ — $ — $ 401,695

(a) In September 2021, TPG Pace Tech Opportunities Corp.

(“PACE”) completed a business combination which resulted in a gain on deconsolidation of PACE in an amount of $ 122.7 million.

(b) Includes pre-tax gain of $ 95.0 million for the year ended December 31, 2021 on remeasurement of the Company’s pre-existing equity investment in NewQuest at fair value prior to consolidation.

See N ote 3 to the Consolidated Financial Statements.

(“TPGS”) completed a business combination which resulted in a gain on deconsolidation of TPGS in an amount of $ 109.9 million.

(d) On May 1, 2020, the Company deconsolidated the assets, liabilities, and partners’ capital of the Former Affiliate and remeasured the retained investment in the Former Affiliate at fair value and recognized a gain of $ 401.7 million.

Notes to Consolidated Financial Statements

There were no activities related to deconsolidation of previously consolidated TPG Funds and Public SPACs during the year ended December 31, 2022.

The following table presents the supplemental cash flow disclosures from activities related to deconsolidation of previously consolidated TPG Funds and Public SPACs during the year ended December 31, 2021 (in thousands):

Cash and cash equivalents $ 491,523

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Other assets 3,696

Due to affiliates — — (4,000)

Derivative liabilities of Public SPACs ( 50,898 )

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Controlling interests 36,386

Non-controlling interests in consolidated TPG Funds — — (48,000)

Other non-controlling interests 61,151

Equity Method Investments, Fair Value Option

On September 20, 2021, TPG PACE Tech Opportunities (“PACE”) completed a business combination with NRDY.

At the time of the business combination, a reconsideration event occurred whereby the Company no longer has power over PACE.

On September 20, 2021, PACE completed a business combination with Nerdy, Inc.

(“NRDY”), a leading platform for delivering live online learning.

At the time of the business combination, a reconsideration event occurred whereby the Company no longer has control over PACE.

As a result, the Company deconsolidated PACE and recorded a gain of $ 122.7 million, which is included in net gains (losses) from investment activities.

As of December 31, 2021, the Company held a 9.4% beneficial ownership interest in in NRDY, consisting of 7.7 million shares of Class A Common Stock, 4.0 million earnout shares and 4.9 million earnout warrants, with an aggregate fair value of $46.0 million.

The warrants entitle the Company to acquire one share of

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

Class A Common Stock at a price of $11.50 per share and expire on September 20, 2026.

As of December 31, 2022 and December 31, 2021, the Company held a 9.0 % and 9.4 % beneficial ownership interest in NRDY, respectively, consisting of 7.7 million shares of Class A common stock, 4.0 million earnout shares and 4.9 million earnout warrants, with an aggregate fair value of $ 20.9 million and $ 46.0 million, respectively.

The warrants entitle the Company to acquire one share of Class A common stock at a price of $ 11.50 per share and expire on September 20, 2026.

The earnout shares and warrants are contingent upon NRDY achieving certain market share price milestones or in the event of a change of control, within five years after September 20, 2021.

In addition to its beneficial ownership in NRDY, the Company has one out of seven board of director seats.

The Company concluded that its ownership interest and its board of director seat demonstrates that it has significant influence over the operating and financial policies of NRDY.

As a result, the Company’s investment in NRDY is subject to the equity method of accounting.

Pursuant to ASC 825 — Financial Instruments (“ASC 825”), the Company elected to apply the fair value option for its investments in NRDY and will remeasure its investments in NRDY at fair value every reporting period.

In November 2020, the Company distributed to its partners 8.8 million of Playa Hotels & Resorts N.V.

(“PLYA”) shares in-kind at a value at the distribution date of $41.2 million which is recognized in in-kind distributions of investments on the Consolidated Statements of Cash Flows.

As of December 31, 2020, the Company held 2.0 million earnout warrants with an aggregate fair value of $9.2 million.

The earnout warrants entitle the Company to acquire one ordinary share for each earnout warrant for an exercise price of €0.10 per ordinary share if the price per share underlying the earnout warrants on the NASDAQ is greater than $13.00 for a period of more than 20 days out of 30 consecutive trading days within five years after March 13, 2017.

The earnout warrants expire five years after March 13, 2017 or earlier upon redemption or liquidation in accordance with their terms.

As a result of the distribution of shares, TPG is no longer entitled to designate a nominee for the Playa board of directors, and therefore, the Company no longer holds significant influence over PLYA.

As such, the Company now accounts for its remaining investment in PLYA as an equity investment.

Equity Method Investments

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In May 2020, TPG and the Former Affiliate completed a transaction to become independent, unaffiliated businesses.

As part of the agreement and in order to complete regulatory disaffiliation, TPG retained a minority economic interest in the Former Affiliate and no longer holds a controlling financial interest in the Former Affiliate’s management companies or general partners of pooled investment entities.

Post-closing, TPG holds an 11% interest across all of the Former Affiliate’s businesses, plus an approximate 30% interest in select vehicles with finite lives.

As part of the agreement and in order to complete regulatory disaffiliation, TPG retained a minority economic interest in the Former Affiliate and no longer held a controlling financial interest in the Former Affiliate’s management companies or general partners of pooled investment entities.

Post-closing, TPG held an 11 % interest across all of the Former Affiliate’s businesses, plus an approximate 30 % interest in select vehicles with finite lives.

On May 1, 2020, the Company deconsolidated the assets, liabilities, and partners’ capital of the Former Affiliate.

As a result of the deconsolidation, the Company remeasured the retained investment in SSP at fair value at the time of the transaction, recognized a gain on deconsolidation of $401.7 million and increased its investment in the Former Affiliate’s underlying net assets by the aforementioned gain.

As a result of the deconsolidation, the Company remeasured the retained investment in Former Affiliate at fair value at the time of the transaction, recognized a gain on deconsolidation in accordance with U.S.

GAAP of $ 401.7 million and increased its investment in the Former Affiliate’s underlying net assets by the aforementioned gain.

Determining the fair value of the Former Affiliate involved making significant estimates and assumptions.

The Company used a combination of the income and market-based approaches to estimate fair value, which are based, respectively, on discounted estimated future cash flows from earnings and market valuation multiples of comparable businesses and transactions.

Of this basis difference, $28.6 million relates to specific investment funds of the Former Affiliate and will be amortized on a straight-line basis over the funds’ estimated remaining lives.

The amortization is recognized in net gains (losses) from investment activities in the Consolidated Statements of Operations.

The remaining amount relates to equity method goodwill recognized upon deconsolidation which is not amortized.

The Company used a combination of the income and market-based approaches to estimate fair value, which were based, respectively, on discounted estimated future cash flows from earnings and market valuation multiples of comparable businesses and transactions.

Of this basis difference, $ 28.6 million related to specific investment funds of the Former Affiliate and was amortized on a straight-line basis over the funds’ estimated remaining lives.

The amortization was recognized in net gains (losses) from investment activities in the Consolidated Statements of Operations.

The remaining amount related to equity method goodwill recognized upon deconsolidation which was not amortized.

The Company accounted for its investment in the Former Affiliate using the equity method of accounting until the Reorganization.

In conjunction with the Reorganization described in Note 1, the Company transferred its investment in the Former Affiliate to RemainCo on December 31, 2021 resulting in the derecognition of our investment in the Former Affiliate.

TPG Group Holdings (SBS), L.P.

In conjunction with the Reorganization described in Note 1 to the Consolidated Financial Statements, the Company transferred its investment in the Former Affiliate to RemainCo on December 31, 2021 resulting in the derecognition of its investment in the Former Affiliate.

Notes to Consolidated Financial Statements

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The Company evaluates its equity method investments in which it has not elected the fair value option for impairment whenever events or changes in circumstances indicate that the carrying amounts of such investments may not be recoverable.

In 2021, the Company did not recognize any impairment losses on an equity method investment without a readily determinable fair value.

In 2020, the Company recognized impairment losses of $4.3 million on an equity method investment without a readily determinable fair value based on significant deterioration of earnings performance.

In 2019, there were no adjustments to the carrying value of equity method investments without readily determinable fair values.

During the years ended December 31, 2022 and 2021, the Company did no t recognize any impairment losses on an equity method investment without a readily determinable fair value.

During the year ended December 31, 2020, the Company recognized impairment losses of $ 4.3 million on an equity method investment without a readily determinable fair value based on significant deterioration of earnings performance.

Equity Investments

Equity investments represent the Company’s proprietary equity investments.

At December 31, 2021 and 2020, the Company held equity investments with readily determinable fair values of $97.9 million and $4.5 million, respectively.

In December 2021, TPG PACE Solutions (“TPGS”) completed a business combination with Vacasa Holdings, LLC, a leading vacation rental management platform.

Equity investments represent proprietary investment securities held by the Company.

At December 31, 2022 and December 31, 2021, the Company held equity investments with readily determinable fair values of $ 12.1 million and $ 97.9 million, respectively.

In December 2021, TPG PACE Solutions Corp.

(“TPGS”) completed a business combination with Vacasa Holdings, LLC, a leading vacation rental management platform.

The business combination was approved on November 30, 2021 by TPGS stockholders and closed on December 7, 2021.

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As a result, the Company deconsolidated TPGS and recorded a gain of $ 109.9 million, which is included in net gains (losses) from investment activities.

Beginning December 7, 2021, Vacasa common stock started trading on the Nasdaq Stock Exchange under the ticker symbol “VCSA”.

Beginning December 7, 2021, Vacasa’s common stock started trading on the Nasdaq Stock Exchange under the ticker symbol “VCSA”.

The Company concluded that it does not exercise significant influence over Vacasa’s operating and financial policies.

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As such, TPG is not required to present separate financial statements for any of its equity method investments.

Notes to Consolidated Financial Statements

The following table shows summarized financial information relating to the Consolidated Statements of Financial Condition for all of TPG’s equity method investments assuming 100 % ownership as of December 31, 2022 and 2021 (in thousands):

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Total equity 63,779,368 55,768,676

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

The following table shows summarized financial information relating to the Consolidated Statements of Operations for all of TPG’s equity method investments assuming 100 % ownership for the years ended December 31, 2022, 2021 and 2020 (in thousands):

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Net income $ 3,982,646 $ 23,737,916 $ 8,641,739

Investments and Securities Sold, Not Yet Purchased held by consolidated TPG Funds

As part of the Reorganization described in Note 1 , all TPG Funds were deconsolidated as of December 31, 2021.

As of December 31, 2020, investments of consolidated TPG Funds, by geographic region, consisted of the following (in thousands):

December 31, 2020

Fair Value Fair Value

Investments of consolidated TPG Funds:

North America equity securities total (Cost:

2020 $124,420) $ 150,684 61.8 %

Latin America equity securities total (Cost:

2020 $0) 8 0.1 %

Europe equity securities total (Cost:

2020 $27,856) 34,491 14.2 %

Asia equity securities total (Cost:

2020 $34,360) 58,178 23.9 %

Investments of consolidated TPG Funds (Cost:

2020 $186,636) $ 243,361 100.0 %

As of December 31, 2020, securities sold, not yet purchased, of consolidated TPG Funds, by geographic region consisted of the following (in thousands):

December 31, 2020

Fair Value Fair Value

Securities sold, not yet purchased, of consolidated TPG Funds:

North America equity securities total (Proceeds:

2020 $47,017) $ 57,629 72.2 %

Europe equity securities total (Proceeds:

2020 $20,028) 20,370 25.5 %

Asia equity securities total (Proceeds:

2020 $1,316) 1,799 2.3 %

Securities sold, not yet purchased, of consolidated TPG Funds (Proceeds:

2020 $68,361) $ 79,798 100.0 %

At December 31, 2020, no investment in any individual security exceeded 5% of Partners’ Capital.

Securities sold, not yet purchased are fully collateralized by cash, securities and derivatives held at the prime brokers of the related consolidated TPG fund.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

Realized and net change in unrealized gains (losses) from investment activities are comprised of the following (in thousands):

Year Ended December 31,

2021 2020 2019

Investment activities of consolidated TPG Funds and Public SPACs:

Realized gains, net on investments $ 35,760 $ 17,450 $ 19,660

Realized (losses) gains on securities sold, not yet purchased (16,044) (13,461) 16,315

Change in unrealized (losses) gains, net on investments (7,998) 9,694 47,463

Change in unrealized gains (losses) on securities sold, not yet purchased 12,022 (17,633) (7,234)

Total net gains (losses) from investments and securities sold short of consolidated TPG Funds 23,740 (3,950) 76,204

Realized (losses) gains, net on derivative instruments (10,444) (3,217) 5,407

Change in unrealized gains (losses), net on derivative instruments 10,096 (11,524) (6,400)

Total net losses on derivative instruments from investment activities of consolidated TPG Funds and Public SPACs (348) (14,741) (993)

Net gains (losses) from investment activities of consolidated TPG Funds and Public SPACs $ 23,392 $ (18,691) $ 75,211

Investment Activities of Consolidated TPG Funds

As part of the Reorganization described in Note 1 to the Consolidated Financial Statements, all TPG Funds were deconsolidated as of December 31, 2021, thus the Company had no gains (losses) from investment activities of consolidated TPG Funds for the year ended December 31, 2022.

Net gains from investment activities of consolidated TPG Funds was $ 23.4 million for the year ended December 31, 2021 and net losses from investment activities of consolidated TPG Funds was $ 18.7 million for the year ended December 31, 2020.

Derivative Instruments

The consolidated TPG Funds and SPACs enter into derivative contracts in connection with their proprietary trading activities, including total return swaps, interest rate swaps and futures, options, foreign currency forwards, credit default swaps, warrants and FPAs, which meet the definition of a derivative in accordance with ASC 815.

As a result of the use of derivative contracts, the consolidated TPG Funds and SPACs are exposed to the risk that counterparties will fail to fulfill their contractual obligations.

Subsequent to the Reorganization, we no longer hold cash at the consolidated TPG Funds’ prime brokerage accounts on the Statements of Financial Condition.

At December 31, 2020, cash of $109.0 million held at the consolidated TPG Funds’ prime brokerage accounts was included in due from counterparty on the Consolidated Statements of Financial Condition.

Certain SPACs issue warrants and enter into FPAs, which meet the definition of a derivative in accordance with ASC 815.

The consolidated Public SPACs enter into derivative contracts in connection with their proprietary trading activities, including warrants and FPAs, which meet the definition of a derivative in accordance with ASC Topic 815, Derivatives and Hedging (“ASC 815”).

As a result of the use of derivative contracts, the consolidated Public SPACs are exposed to the risk that counterparties will fail to fulfill their contractual obligations and are exposed to the volatility of the underlying instruments.

These warrants and FPAs are included in derivative liabilities of Public SPACs on the Consolidated Statements of Financial Condition.

As a result of the issuance of warrants and FPAs, the consolidated Public SPACs are exposed to the volatility of the underlying instruments.

As of December 31, 2021 and 2020, the fair value of the warrants and FPAs were $13.0 million and $263.3 million, respectively.

There were no related offsets or cash collateral pledged or received for the warrants and FPAs for the years ended December 31, 2021 or 2020.

For the year ended December 31, 2021, the Company recorded unrealized gains on warrants and FPAs totaling $211.8 million.

For the years ended December 31, 2020 and 2019, the Company recorded unrealized losses on warrants and FPAs totaling $239.3 million and $15.3 million, respectively.

TPG Group Holdings (SBS), L.P.

As of December 31, 2022 and December 31, 2021, the fair value of the warrants and FPAs were $ 0.7 million and $ 13.0 million, respectively.

There were no related offsets or cash collateral pledged or received for the warrants and FPAs as of December 31, 2022 and December 31, 2021.

For the years ended December 31, 2022 and 2021, the Company recorded unrealized gains on warrants and FPAs totaling $ 12.4 million and $ 211.8 million, respectively.

For the year ended December 31, 2020, the Company recorded unrealized losses on warrants and FPAs totaling $ 239.3 million.

Notes to Consolidated Financial Statements

The consolidated TPG Funds and SPACs’ derivative instruments as well as other assets held at the prime broker were as follows (in thousands):

December 31, 2021

Fair Value Other Assets at

the Prime Broker

Derivatives not designated as hedging instruments under Subtopic 815-20:

Liability derivatives:

Public warrants $ 11,662 $ — $ 11,662 $ —

Forward purchase agreements 1,386 — 1,386 —

Derivative liabilities of Public SPACs $ 13,048 $ — $ 13,048 $ —

December 31, 2020

Fair Value Other Assets at

the Prime Broker Total Amount

Presented Notional

The consolidated Public SPACs’ derivative instruments were as follows (in thousands):

December 31, 2022 December 31, 2021

Derivatives not designated as hedging instruments under Subtopic 815-20:

Asset derivatives

Total return swaps $ 1,358 $ — $ 1,358 $ 11,968

Foreign currency forwards 155 — 155 22,847

1,513 — 1,513 34,815

Cash — 108,969 108,969 —

Due from counterparty $ 1,513 $ 108,969 $ 110,482 $ 34,815

Liability derivatives:

Total return swaps $ 11,763 $ — $ 11,763 $ 45,353

Foreign currency forwards 258 — 258 14,661

Due to counterparty $ 12,021 $ — $ 12,021 $ 60,014

Public warrants $ 667 $ 11,662

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Derivative liabilities of Public SPACs $ 667 $ 13,048

_______________

(a) While notional value gives some indication of the volume of derivative trading activity, the notional amount is generally not exchanged, but is only used as the basis on which interest and other payments are exchanged.

For certain derivative instruments that are denominated in foreign currencies, the fair value is translated to U.S.

dollars at the balance sheet date while the notional value is translated to U.S.

dollars at the transaction date.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

Net gains (losses) on derivative instruments are included in the Consolidated Statements of Operations as net gains (losses) from investment activities of consolidated TPG Funds and Public SPACs or unrealized gains (losses) on derivative liabilities of Public SPACs.

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2022 2021 2020

Realized (losses) gains, net on total return swaps $ (10,269) $ (5,139) $ 6,726

Realized losses, net on total return swaps $ — $ ( 10,269 ) $ ( 5,139 )

Realized (losses) gains, net on foreign currency forwards — ( 175 ) 1,922

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Net gains (losses) on derivative instruments $ 12,382 $ 211,474 $ ( 254,010 )

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

Fair Value Measurement

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Total assets $ 32,979 $ — $ — $ 32,979

Liabilities of consolidated TPG Funds and Public SPACs:

Liabilities of consolidated Public SPACs (a) :

Public warrants $ 667 $ — $ — $ 667

Forward purchase agreements — — 1,386 1,386

Total liabilities $ 667 $ — $ — $ 667

_______________

(a) The FPAs related to TPG PACE Beneficial Finance Corp.

("TPGY") were terminated at zero fair value on October 11, 2022.

Notes to Consolidated Financial Statements

December 31, 2021

Level I Level II Level III Total

Equity investments $ 13,680 $ — $ — $ 13,680

Assets of consolidated TPG Funds:

Equity method investments - fair value option $ 46,013 $ — $ — $ 46,013

Equity investments 97,899 — — 97,899

Foreign currency forwards — 155 — 155

Total return swaps — 1,358 — 1,358

Total assets $ 143,912 $ — $ — $ 143,912

Embedded contingent zero strike price forward contract $ — $ — $ 5,000 $ 5,000

Liabilities of consolidated TPG Funds and Public SPACs:

Liabilities of consolidated Public SPACs:

Public warrants $ 11,662 $ — $ — $ 11,662

Forward purchase agreements — — 1,386 1,386

Securities sold, not yet purchased 79,798 — — 79,798

Foreign currency forwards — 258 — 258

Total return swaps — 11,763 — 11,763

Total liabilities $ 11,662 $ — $ 1,386 $ 13,048

The valuation methodology used in the determination of the fair value of financial instruments for which Level III inputs were used at December 31, 2021 and 2020 included a combination of the market approach and income approach.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

The valuation methodology used in the determination of the fair value of financial instruments for which Level III inputs were used at December 31, 2022 and December 31, 2021 included a combination of the market approach and income approach.

The following tables summarize the changes in the fair value of financial instruments for which the Company has used Level III inputs to determine fair value (in thousands):

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Deconsolidation (a)

Transfers (b)

Balance, end of period $ — $ —

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Unrealized gains, net ( 1,386 ) ( 164,695 )

Transfers (c)

Transfers (b)

Balance, end of period $ — $ 1,386

_______________

(a) $5.1 million for the year ended December 31, 2021 represents the impact of the deconsolidation of certain TPG Funds in conjunction with the Reorganization described in Note 1 .

(b) Transfers into Level III equity securities of $0.4 million for the year ended December 31, 2020 were due to changes in the observability of inputs used in valuation.

(c) Transfers out of Level III derivative liabilities of $31.5 million for the year ended December 31, 2021 were due to the deconsolidation of PACE.

Total realized and unrealized gains and losses recorded for Level III investments are reported in net gains (losses) from investment activities of consolidated TPG Funds and Public SPACs and unrealized gains (losses) on derivative liabilities of consolidated TPG Funds and Public SPACs in the Consolidated Statements of Operations.

The following tables provide qualitative information about investments categorized in Level III of the fair value hierarchy as of December 31, 2021 and 2020.

(a) $ 5.1 million for the year ended December 31, 2021 represents the impact of the deconsolidation of certain TPG Funds in conjunction with the Reorganization described in Note 1 to the Consolidated Financial Statements.

(b) Transfers out of Level III derivative liabilities of $ 31.5 million for the year ended December 31, 2021 were due to the deconsolidation of PACE.

See Note 4 to the Consolidated Financial Statements.

Total realized and unrealized gains and losses recorded for Level III investments are reported in net gains (losses) from investment activities of consolidated TPG Funds and Public SPACs and unrealized gains (losses) on derivative liabilities of Public SPACs in the Consolidated Statements of Operations.

As of December 31, 2022, there are no investments categorized as Level III of the fair value hierarchy.

The following tables provide qualitative information about investments categorized in Level III of the fair value hierarchy as of December 31, 2021.

In addition to the techniques and inputs noted in the table below, in accordance with the valuation policy, other valuation techniques and methodologies are used when determining fair value measurements.

The below table is not intended to be all-inclusive, but rather provides information on the significant Level III inputs as they relate to the Company’s fair value measurements (fair value measurements in thousands):

December 31, 2021

Range (Weighted

Forward purchase agreements $ 1,386 Market comparables Implied volatility 13.0%

_______________

(a) In determining certain of these inputs, management evaluates a variety of factors including economic conditions, industry and market developments, market valuations of comparable companies and company-specific developments including exit strategies and realization opportunities.

Management has determined that market participants would take these inputs into account when valuing the investments.

(b) Inputs weighted based on fair value of investments in range.

TPG Group Holdings (SBS), L.P.

The below table

Notes to Consolidated Financial Statements

December 31, 2020

is not intended to be all-inclusive, but rather provides information on the significant Level III inputs as they relate to the Company’s fair value measurements (fair value measurements in thousands):

Fair Value December 31, 2021 Valuation

Technique(s) Unobservable

Range (Weighted

Equity securities $ 12,324 Market comparables LTM EBITDA multiple 3.8x - 14.5x (12.8x)

FWD EBITDA multiple 5.75x - 5.75x (5.75x)

NOI cap rate 6.5% - 7.1% (7.0%)

Discounted cash flows 15% Discount rate Not applicable

Indicative pricing Operating and market performance Not applicable

Last transaction price Operating and market performance Not applicable

Forward purchase agreements $ 1,386 Market comparables Implied volatility 13.0 %

Embedded contingent zero strike price forward contract 5,000 Other Probability weighted expected return Not applicable

_______________

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Management has determined that market participants would take these inputs into account when valuing the investments.

LTM represents Last Twelve Months, EBITDA represents Earnings Before Interest, Taxes, Depreciation and Amortization, FWD represents Forward and NOI represents Net Operating Income.

(b) Inputs weighted based on fair value of investments in range.

(c) Amounts include $0.2 million of investments whose valuation inputs are not directly comparable to other private equity investments, and as such, the unobservable inputs associated with these investments have been excluded from this table.

These investments include financial instruments for which fair value is primarily based on expected proceeds ($0.2 million).

TPG Group Holdings (SBS), L.P.

Intangible Assets and Goodwill

As discussed in Note 3 to the Consolidated Financial Statements, on July 1, 2021, the Company completed the acquisition of NewQuest, which resulted in the recognition of goodwill of $ 203.7 million and certain identifiable intangible assets, which are presented in other assets on the Consolidated Statements of Financial Condition.

The following table summarizes the carrying amounts of goodwill and intangible assets as of December 31, 2022 and 2021 (in thousands):

Contractual performance fee allocations (a)

$ 102,591 $ 122,598

Management contracts (a)

10,625 16,874

Investor relationships (a)

21,875 23,958

Other intangibles 1,096 1,121

230,194 230,194

Total intangible assets and goodwill $ 366,381 $ 394,745

_______________

(a) Intangibles related to the acquisition of NewQuest described in Note 3 to the Consolidated Financial Statements.

(b) Includes $ 203.7 million of goodwill related to the acquisition of NewQuest described in Note 3 to the Consolidated Financial Statements.

No impairment losses on goodwill or intangible assets were recorded during the years ended December 31, 2022, 2021 and 2020.

Intangible asset amortization expense was $ 28.4 million, $ 19.8 million and less than $ 0.1 million for the years ended December 31, 2022, 2021 and 2020, respectively.

The following table presents estimated remaining amortization expense for intangible assets that existed as of December 31, 2022 (in thousands):

Notes to Consolidated Financial Statements

2023 $ 27,114

Thereafter 19,602

Total $ 135,194

Other assets consist of the following (in thousands):

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Total fixed assets, net 24,053 26,310

230,194 26,500

Intangible assets, net (b)

164,551 1,146

Goodwill 230,194 230,194

Intangible assets, net 136,187 164,551

Right-of-use assets 130,357 157,467

Prepaid expenses 23,809 23,995

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Other assets $ 629,392 $ 657,317

_______________

(a) Includes $203.7 million of goodwill related to the acquisition of NewQuest described in Note 3 .

(b) Includes $163.4 million of intangibles related to the acquisition of NewQuest described in Note 3 .

Accounts Payable and Accrued Expenses, and Other Liabilities

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Other liabilities consist of the following (in thousands):

Lease Obligation $ 147,887 $ 177,003

Clawback liability (see Note 18) 58,317 58,317

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Other liabilities $ 226,090 $ 238,246

Notes to Consolidated Financial Statements

Credit and Market Risk

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Management believes the carrying values of these assets are reasonable taking into consideration credit and market risks along with estimated collateral values, payment histories and other information.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

In the normal course of business, TPG encounters market and credit risk concentrations.

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The TPG Funds make investments outside of the United States.

Investments outside the U.S.

may be subject to less developed bankruptcy, corporate, partnership and other laws (which may have the effect of disregarding or otherwise circumventing the limited liability structures potentially causing the actions or liabilities of one fund or a portfolio company to adversely impact the TPG Funds or an unrelated fund or portfolio company).

Investments outside the United States may be subject to less developed bankruptcy, corporate, partnership and other laws (which may have the effect of disregarding or otherwise circumventing the limited liability structures potentially causing the actions or liabilities of one fund or a portfolio company to adversely impact the TPG Funds or an unrelated fund or portfolio company).

investments are subject to the same risks associated with the TPG Funds’ U.S.

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The participants in such markets are typically not subject to credit evaluation and regulatory oversight unlike members of exchange-based markets.

This exposes the Company to the risk that a counterparty will not settle a transaction in accordance with its terms and conditions because of a dispute over the terms of the applicable contract (whether or not such dispute is bona fide) or because of a credit or liquidity problem, causing the Company to suffer losses.

This exposes the Company to the risk that a counterparty will not

Notes to Consolidated Financial Statements

settle a transaction in accordance with its terms and conditions because of a dispute over the terms of the applicable contract (whether or not such dispute is bona fide) or because of a credit or liquidity problem, causing the Company to suffer losses.

Such “counterparty risk” is accentuated for contracts with longer maturities where events may intervene to prevent settlement, or where the Company has concentrated its transactions with a single or small group of counterparties.

TPG attempts to minimize this risk by limiting its counterparties to major financial institutions with strong credit ratings.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

Variable Interest Entities

TPG consolidates VIEs in which it is considered the primary beneficiary as described in Note 2 .

TPG consolidates VIEs in which it is considered the primary beneficiary as described in Note 2 to the Consolidated Financial Statements.

TPG’s investment strategies differ by TPG Fund;

however, the fundamental risks have similar characteristics, including loss of invested capital and loss of management fees and carried interests.

however, the fundamental risks have similar characteristics, including loss of invested capital and loss of management fees and performance allocations.

The Company does not provide performance guarantees and has no other financial obligation to provide funding to consolidated VIEs other than its own capital commitments.

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The Company’s involvement with such entities is in the form of direct equity interests and fee arrangements.

The fundamental risks have similar characteristics, including loss of invested capital and loss of management fees and carried interests.

The fundamental risks have similar characteristics, including loss of invested capital and loss of management fees and performance allocations.

Accordingly, disaggregation of TPG’s involvement by type of VIE would not provide more useful information.

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The maximum exposure to loss represents the loss of assets recognized by TPG relating to non-consolidated entities and any amounts due to non-consolidated entities.

The assets and liabilities recognized in the Company’s Consolidated Statements of Financial Condition related to its interest in these non-consolidated VIEs and its maximum exposure to loss relating to non-consolidated VIEs were as follows:

Investments (includes assets pledged of $ 475,110 and $ 492,276 )

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Maximum exposure to loss $ 7,290,795 $ 7,587,591

In conjunction with the Reorganization described in Note 1, the TPG Operating Group and RemainCo entered into certain agreements to effectuate the go-forward relationship between the entities.

In conjunction with the Reorganization described in Note 1 to the Consolidated Financial Statements, the TPG Operating Group and RemainCo entered into certain agreements to effectuate the go-forward relationship between the entities.

The arrangements discussed below represent the TPG Operating Group’s variable interests in RemainCo, which do not provide the TPG Operating Group with the power to direct the activities that most significantly impact RemainCo’s performance and operations.

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In accordance with the TPG Operating Group’s agreement with RemainCo (the “RemainCo Performance Earnings Agreement”), RemainCo is entitled to distributions in respect of performance allocations from TPG Funds as described below.

For certain existing TPG Funds that are advanced in their life cycles, which we refer to as the “Excluded Funds,” RemainCo is generally entitled to receive distributions of performance allocations not previously designated for our people or unaffiliated third parties, and the TPG Operating Group is not entitled to further performance allocations from the Excluded Funds.

For TPG Funds of a more recent vintage and for future TPG Funds, which we collectively refer to as the “Included Funds,” RemainCo is entitled to a base performance allocation ranging from 10% to 15% (subject to limited exceptions, including TPG Funds acquired in a business combination or formed with meaningful participation by the counterparty of such business combination) depending upon the Included Fund (the “Base Entitlement”).

TPG Group Holdings (SBS), L.P.

For certain existing TPG Funds that are advanced in their life cycles, which we refer to as the “Excluded Funds,”

Notes to Consolidated Financial Statements

RemainCo is generally entitled to receive distributions of performance allocations not previously designated for partners and employees or unaffiliated third parties, and the TPG Operating Group is not entitled to further performance allocations from the Excluded Funds.

For TPG Funds of a more recent vintage and for future TPG Funds, which we collectively refer to as the “Included Funds,” RemainCo is entitled to a base performance allocation ranging from 10 % to 15 % (subject to limited exceptions, including TPG Funds acquired in a business combination or formed with meaningful participation by the counterparty of such business combination) depending upon the Included Fund (the “Base Entitlement”).

With respect to any TPG Fund that holds a first closing involving non-affiliated investors (a “First Closing”) on or after the fifth anniversary of the IPO, the Base Entitlement will step down ratably for each annual period following the fifth anniversary of the IPO through the fifteenth anniversary.

RemainCo will not be entitled to distributions of performance allocations with respect to TPG Funds that have not held a First Closing on or prior to the fifteenth anniversary of the IPO.

Once determined, RemainCo’s entitlement to performance allocation percentage with respect to any TPG Fund will remain in effect for the life of the applicable fund.

Once determined, RemainCo’s entitlement to the performance allocation percentage with respect to any TPG Fund will remain in effect for the life of the applicable fund.

RemainCo is obligated to fund its pro rata share of clawback obligations with respect to any TPG Fund (in proportion to the Base Entitlement with respect to such TPG Fund) either directly or through indemnity or similar obligations to the TPG Operating Group.

In the event that the underlying assets of RemainCo are not sufficient to cover the clawback amount, the TPG Operating Group is obligated to cover any shortfall of clawback.

In the event that the underlying assets of RemainCo are not sufficient to cover the clawback amount, the TPG Operating Group is obligated to cover any shortfall of the clawback.

This shortfall covered by the TPG Operating Group would be required to be repaid by RemainCo out of future distributions.

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RemainCo Administrative Services Agreement

The TPG Operating Group has entered into an administrative services agreement with RemainCo whereby we will provide RemainCo with certain administrative services, including maintaining RemainCo’s books and records, tax and financial reporting and similar support beginning in 2022.

In exchange for these services, RemainCo will pay the TPG Operating Group an annual administration fee in the amount of 1% per annum of the net asset value of RemainCo’s assets, with such amount payable quarterly in advance.

The TPG Operating Group has entered into an administrative services agreement with RemainCo whereby the TPG Operating Group provides RemainCo with certain administrative services, including maintaining RemainCo’s books and records, tax and financial reporting and similar support which began on January 1, 2022.

In exchange for these services, RemainCo pays the TPG Operating Group an annual administration fee in the amount of 1 % per annum of the net asset value of RemainCo’s assets, with such amount payable quarterly in advance.

Securitization Vehicles

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The notes issued by these VIEs are backed by the cash flows related to the Company’s equity method investments (“Participation Rights”) in certain funds.

The Company determined that it is the primary beneficiary of the securitization vehicles because (i) its servicing responsibilities for the Participation Rights gives it the power to direct the activities that most significantly impact the performance of the VIEs, and (ii) its variable interests in the VIEs gives the Company the obligation to absorb losses and the right to receive residual returns that could potentially be significant.

The Company determined that it is the primary beneficiary of the securitization vehicles because (i) its servicing responsibilities for the Participation Rights give the Company the power to direct the activities that most significantly impact the performance of the VIEs, and (ii) its variable interests in the VIEs give the Company the obligation to absorb losses and the right to receive residual returns that could potentially be significant.

In 2019, certain subsidiaries of the Company issued an additional $ 50.0 million in privately placed securitization notes.

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Additionally, the Participation Rights and other assets directly held by the VIEs are not available to satisfy the general obligations of the Company.

Notes to Consolidated Financial Statements

As the primary beneficiary of these entities, the Company is exposed to credit, interest rate and market risk from the Participation Rights in the VIEs.

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The Company may also be exposed to interest rate risk arising from the secured notes issued by the VIEs.

The secured notes issued by the VIE’s are shown on the Company’s Consolidated Statements of Financial Condition as secured borrowings, net of unamortized issuance costs for the years ended December 31, 2021 and 2020 of $5.1 million and $5.4 million, respectively.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

The following table depicts the total assets and liabilities related to VIE securitization transactions included in the Company’s Consolidated Statements of Financial Condition:

The secured notes issued by the VIEs are shown on the Company’s Consolidated Statements of Financial Condition as secured borrowings, net of unamortized issuance costs as of December 31, 2022 and December 31, 2021 of $ 4.7 million and $ 5.1 million, respectively.

The following table depicts the total assets and liabilities related to VIE securitization transactions included in the Company’s Consolidated Statements of Financial Condition (in thousands):

Cash and cash equivalents $ 33,612 $ 24,719

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(a) Participation rights receivable related to VIE securitization transactions are included in investments in the Company’s Consolidated Statements of Financial Condition .

Credit Facilities

Senior Unsecured Term loan

In December 2021, the Company entered into a credit agreement (the “Senior Unsecured Term Loan Agreement”) pursuant to which the lenders thereunder agreed to make term loans in a principal amount of up to $300.0 million during the period commencing on December 2, 2021 and ending on the date that is 30 days thereafter.

Unused commitments were terminated at the end of such period.

The term loans have an interest rate of LIBOR plus 1.00% and will mature in December 2024.

As of December 31, 2021, $200.0 million was outstanding under the Senior Unsecured Term Loan Agreement.

During the year ended December 31, 2021, the Company incurred interest expense of $0.2 million on the Senior Unsecured Term Loan.

Subordinated Credit Facility

In August 2014, a consolidated subsidiary of the Company entered into two $15.0 million subordinated revolving credit facilities (collectively, the “Subordinated Credit Facility”), for a total commitment of $30.0 million.

The Subordinated Credit Facility is available for direct borrowings and is guaranteed by certain members of the TPG Operating Group.

In July 2021, the subsidiary extended the maturity date of the Subordinated Credit Facility from August 2022 to August 2023.

In July 2020, the subsidiary extended the maturity date of the Subordinated Credit Facility from August 2021 to August 2022.

In August 2019, the subsidiary extended the maturity date of the Subordinated Credit Facility from August 2020 to August 2021.

The interest rate for borrowings under the Subordinated Credit Facility is calculated at the LIBOR rate at the time of borrowing plus 2.25%.

During the year ended December 31, 2021, the subsidiary did not borrow or make repayments on the Subordinated Credit Facility, leaving a zero balance at December 31, 2021.

During the year ended December 31, 2020, the subsidiary borrowed $55.0 million and made repayments of $55.0 million on the Subordinated Credit Facility, resulting in no amount outstanding as of December 31, 2020.

During each of the years ended December 31, 2021 and 2020, the subsidiary incurred interest expense and uncommitted line of credit fees on the Subordinated Credit Facility of $0.2 million.

During the year ended December 31, 2019, the subsidiary incurred interest expense and uncommitted line of credit fees on the Subordinated Credit Facility of $0.1 million.

TPG Group Holdings (SBS), L.P.

The following table summarizes the Company’s and its subsidiaries’ debt obligations (in thousands):

As of December 31, 2022 As of December 31, 2021

Debt Origination Date Maturity Date Borrowing Capacity Carrying Value Interest Rate Carrying Value Interest Rate

Senior Unsecured Revolving Credit Facility (a)

March 2011 July 2027 $ 700,000 $ — 5.46 % $ — 1.85 %

Subordinated Credit Facility (b)

August 2014 August 2024 30,000 — 6.71 % — 2.35 %

Senior Unsecured Term Loan (c)

December 2021 December 2024 200,000 199,307 5.46 % 199,494 1.10 %

Secured Borrowings - Tranche A (d)

May 2018 June 2038 200,000 196,186 5.33 % 195,938 5.33 %

Secured Borrowings - Tranche B (d)

October 2019 June 2038 50,000 49,073 4.75 % 49,012 4.75 %

Total debt obligations $ 1,180,000 $ 444,566 $ 444,444

_______________

(a) In March 2011, TPG Holdings, L.P.

entered into a $ 400.0 million credit facility (the “Senior Unsecured Revolving Credit Facility”).

Between 2018 and 2021, TPG Holdings, L.P.

entered into the first, second, third and fourth amendments to the Senior Unsecured Revolving Credit Facility to, among other things, release the collateral package under the facility, reduce commitments to $ 300.0 million and to provide for successor borrowers.

In July 2022, TPG Operating Group II, L.P., as borrower, entered into a fifth amendment and restatement of the Senior Unsecured Revolving Credit Facility (the “Amended Senior Unsecured Revolving Credit Facility”) to among other things, (i) extend the maturity date of the revolving credit facility from November 2025 to July 2027, (ii) increase the aggregate revolving commitments thereunder from $ 300.0 million to $ 700.0 million and (iii) replace LIBOR as the applicable reference rate with the Secured Overnight Financing Rate (“SOFR”) and otherwise conform the credit facility to accommodate SOFR as the reference rate.

Dollar-denominated principal amounts outstanding under the Amended

Notes to Consolidated Financial Statements

Secured Borrowings

The Company’s secured borrowings are issued using on-balance sheet securitization vehicles, as further discussed in N ote 1 1 .

Senior Unsecured Revolving Credit Facility accrue interest, at the option of the applicable borrower, either (i) at a base rate plus applicable margin not to exceed 0.25 % per annum or (ii) at a term SOFR rate plus a 0.10 % per annum adjustment and an applicable margin not to exceed 1.25 %.

The Company is also required to pay a quarterly commitment fee on the unused commitments under the Amended Senior Unsecured Revolving Credit Facility not to exceed 0.15 % per annum, as well as certain customary fees for any issued letters of credit.

In August 2022, the Company entered into a first amendment to the Amended Senior Unsecured Revolving Credit Facility, which provides that if the Company is not publicly rated, the applicable margin for borrowings under the facility may be determined using the Company’s leverage ratio.

(b) A consolidated subsidiary of the Company entered into two $ 15.0 million subordinated revolving credit facilities (collectively, the “Subordinated Credit Facility”), for a total commitment of $ 30.0 million.

The Subordinated Credit Facility is available for direct borrowings and is guaranteed by certain members of the TPG Operating Group.

In August 2022, the subsidiary extended the maturity date of the Subordinated Credit Facility from August 2023 to August 2024 and replaced LIBOR as the applicable reference rate with SOFR, and otherwise conforms the agreements to accommodate SOFR as the reference rate.

(c) In December 2021, the Company entered into a credit agreement (the “Senior Unsecured Term Loan Agreement”) pursuant to which the lenders thereunder agreed to make term loans in a principal amount of up to $ 300.0 million during the period commencing on December 2, 2021 and ending on the date that is 30 days thereafter.

Unused commitments were terminated at the end of such period.

The term loans had an interest rate of LIBOR plus 1.00 % and will mature in December 2024.

In July 2022, the Company entered into an amended and restated term loan agreement (the “Amended Senior Unsecured Term Loan Agreement”).

The Amended Senior Unsecured Term Loan Agreement, among other things, replaces LIBOR as the applicable reference rate with SOFR, and otherwise conforms the term loan agreement to accommodate SOFR as the reference rate.

Principal amounts outstanding under the Amended Senior Unsecured Term Loan Agreement accrue interest, at the option of the borrower, either (i) at a base rate plus an applicable margin of 0.00 % or (ii) at a term SOFR rate plus a 0.10 % per annum adjustment and an applicable margin of 1.00 %.

(d) The Company’s secured borrowings are issued using on-balance sheet securitization vehicles, as further discussed in Note 1 1 to the Consolidated Financial Statements.

The secured borrowings are repayable only from collections on the underlying securitized equity method investments and restricted cash.

4 unchanged sentences

If the secured borrowings are not redeemed on or prior to June 20, 2028, the Company will pay additional interest equal to 4.00 % per annum.

Interest expense related to tranche A and tranche B secured borrowings for the years ended December 31, 2021, 2020 and 2019 was approximately $13.3 million, $13.1 million and $11.9 million, respectively.

The secured borrowings contain covenants and conditions customary in transactions of this nature, including negative pledge provisions, default provisions and operating covenants, limitations on certain consolidations, mergers and sales of assets.

At December 31, 2022, the Company is in compliance with these covenants and conditions.

Revolving Credit Facility

During the years ended December 31, 2021 and 2020, certain consolidated TPG funds neither borrowed nor made repayments under a separate revolving credit facility, resulting in a zero balance at December 31, 2021 and 2020.

The interest rate for borrowings under the revolving credit facility is calculated at the LIBOR rate at the time of borrowing plus 1.50%.

In conjunction with the Reorganization described in Note 1 , the Company transferred its co-investment interests in such TPG funds to RemainCo and no longer consolidates the TPG Funds.

The Company is treated as a partnership for income tax purposes and is therefore not subject to U.S.

federal, state or local income taxes.

Certain consolidated subsidiaries are subject to taxation in the U.S.

(federal, state or local) and foreign jurisdictions as a result of their entity classification for tax reporting purposes.

During the years ended December 31, 2022, 2021 and 2020, the Company incurred interest expense of $ 19.0 million, $ 14.3 million and $ 15.7 million, respectively, on its debt obligations.

At December 31, 2022 and 2021, the estimated fair value of the secured borrowings based on current market rates and credit spreads for debt with similar maturities was $ 231.5 million and $ 271.6 million, respectively, and the carrying value, excluding unamortized issuance costs, was $ 250.0 million at December 31, 2022 and 2021.

At December 31, 2022, the fair value of the Company’s Senior Unsecured Term Loan was $ 199.2 million, which approximates its carrying amount represented in the Consolidated Statements of Financial Condition due to its variable rate nature.

As a result of the Reorganization, the Company is treated as a corporation for U.S.

federal and state income tax purposes.

We are subject to U.S.

federal and state income taxes, in addition to local and foreign income taxes, with respect to our allocable share of taxable income generated by the TPG Operating Group partnerships.

Prior to the Reorganization, the Company was treated as a partnership for U.S.

federal income tax purposes and therefore was not subject to U.S.

federal and state income taxes except for certain consolidated subsidiaries that were subject to taxation in the U.S.

(federal, state and local) and foreign jurisdictions as a result of their entity classification for tax reporting purposes.

The income (loss) before income taxes includes the following components (in thousands):

Year Ended December 31,

2022 2021 2020

Income (loss) before income taxes

United States $ 80,872 $ 3,171,385 $ 1,756,113

International ( 104,624 ) 1,493,650 ( 307,402 )

$ ( 23,752 ) $ 4,665,035 $ 1,448,711

Notes to Consolidated Financial Statements

The Company has provided U.S.

3 unchanged sentences

2022 2021 2020

Current income taxes

International $ 5,010 $ 7,936 $ 360

Current income taxes (benefit)

Federal $ 44,714 $ 1,950 $ 1,124

State and local 9,466 1,954 1,582

8,914 10,642 4,264

Deferred income taxes (income tax benefits)

International 5,443 5,010 7,936

59,623 8,914 10,642

Deferred income taxes (benefit)

Federal ( 21,639 ) ( 223 ) ( 334 )

State and local ( 4,769 ) ( 105 ) ( 192 )

International ( 732 ) 452 ( 337 )

( 27,140 ) 124 ( 863 )

Income tax expense $ 9,038 $ 9,779 $ 5,689

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

Income tax expense (benefit) $ 32,483 $ 9,038 $ 9,779

Income taxes are provided at the applicable statutory rates.

2 unchanged sentences

Accruals $ 2,063 $ 1,637

Investment basis differences 99,018 —

Equity based compensation 10,674 —

Lease liabilities 12,638 —

Fixed assets 369 384

1 unchanged sentence

Net operating loss carryforwards — 449

Partnership book/tax differences 125 (215)

Less valuation allowance (442) (715)

Other 603 125

125,371 2,900

valuation allowance ( 80,340 ) ( 442 )

Deferred tax assets, net $ 45,031 $ 2,458

1 unchanged sentence

Accruals $ 42 $ 25

Right-of-use assets 11,157 —

Fixed assets 155 585

2 unchanged sentences

Deferred tax liabilities, net $ 11,572 $ 303

The Company’s deferred tax assets and deferred tax liabilities are included in the Consolidated Financial Statements within other assets, and accounts payable and accrued expenses, respectively.

As of December 31, 2022, the Company has recognized net deferred tax assets before the considerations of valuation allowances in the amount of $ 113.8 million which primarily relate to excess income tax basis versus book basis differences in connection with the Company’s investment in the TPG Operating Group partnerships.

The excess of income tax basis in the TPG Operating Group partnerships was primarily due to the Reorganization which resulted in a step-up in the tax basis of certain assets to the Company that will be recovered as those underlying assets are sold or the tax basis is amortized.

A portion of the excess income tax basis in the TPG Operating Group partnerships will only reverse upon a sale

Notes to Consolidated Financial Statements

of the Company’s interest in the TPG Operating Group partnerships which is not expected to occur in the foreseeable future.

As a result, the Company has recognized a valuation allowance in the amount of $ 80.3 million against its net deferred tax assets of $ 113.8 million (resulting in net deferred tax assets after valuation allowance of $ 33.5 million) as of December 31, 2022, as it is more-likely-than not that this portion of our deferred tax assets is not realizable.

The Company evaluates the realizability of its deferred tax asset on a quarterly basis and adjusts the valuation allowance when it is more-likely-than-not that all or a portion of the deferred tax asset may not be realized.

Additionally, and concurrent with the Reorganization, the Company recorded a payable pursuant to the Tax Receivable Agreement within other liabilities in the Consolidated Statements of Financial Condition of $ 18.3 million.

At December 31, 2022, the Company did not have any foreign or federal net operating loss carryforwards, any state or local net operating losses, or any foreign tax credit carryforwards, net of valuation allowance.

2 unchanged sentences

The assumptions about future taxable income require significant judgment and are consistent with the plans and estimates that the Company uses to manage its business.

The Company’s projections of future taxable income that include the effects of originating and reversing temporary differences, including those for the tax basis intangibles, indicate that it is more likely that not that the benefits from the deferred tax asset will be realized.

The Company’s projections of future taxable income that include the effects of originating and reversing temporary differences, including those for the tax basis intangibles, indicate that it is more likely than not that the benefits from the deferred tax asset will be realized.

The following table reconciles the U.S.

4 unchanged sentences

Income passed through to partners ( 136.2 ) ( 20.1 ) ( 24.5 )

Permanent adjustments — 0.01 0.03

International tax rate differentials (0.76) 4.08 0.42

State and local tax provisions 0.04 0.10 0.13

State and local income taxes ( 25.9 ) — 0.1

Foreign Taxes, net of U.S.

foreign tax credits ( 17.3 ) ( 0.8 ) 4.1

Equity based compensation 2.0 — —

Change in TPG Operating Group Partnerships tax basis estimate

Return to Provision 3.9 — —

Change in valuation allowance ( 4.3 ) — —

Other ( 1.7 ) — —

Effective income tax rate ( 136.8 %) 0.2 % 0.7 %

For the years ended December 31, 2021, 2020, and 2019, international tax rate differentials include unrealized losses on derivatives attributable to consolidated Public SPACs which impacted the rate by (0.95)%, 3.47% and 0.27%, respectively.

TPG Group Holdings (SBS), L.P.

The Company’s effective tax rate was ( 136.8 )%, 0.2 % and 0.7 % for the years ended December 31, 2022, 2021 and 2020, respectively.

The Company’s effective tax rate is dependent on many factors, including the estimated amount of income subject to tax.

Consequently, the effective tax rate can vary from period to period.

The Company’s overall effective tax rate in each of the periods described above deviates from the statutory rate primarily because (i) the Company was not subject to U.S.

federal taxes prior to the Reorganization and (ii) a portion of income and losses are allocated to non-controlling interests, and the tax liability on such income or loss is borne by the holders of such non-controlling interests.

In addition, during the year ended December 31, 2022, the Company recognized an income tax benefit in connection with certain changes in estimate of the income tax basis of the Company's investments in the TPG Operating Group partnerships at the time of the Reorganization.

Notes to Consolidated Financial Statements

The following is a tabular reconciliation of unrecognized tax benefits, excluding interest and penalties (in thousands):

Year Ended December 31,

2022 2021 2020

Unrecognized tax benefits - January 1 $ 1,965 $ 1,760 $ 1,459

Additions related to current year positions 259 359 363

Additions related to prior year positions — — —

Reductions for tax positions of prior years — ( 119 ) —

Settlements — — —

Lapse of statute of limitations — — —

Exchange rate fluctuations ( 200 ) ( 35 ) ( 62 )

Unrecognized tax benefits - December 31 $ 2,024 $ 1,965 $ 1,760

The Company recognizes interest accrued on uncertain tax benefits in income tax expense.

For the years ended December 31, 2022, 2021, 2020, the Company recognized interest of $ 1.1 million, $ 0.9 million and $ 0.8 million, respectively.

The Company recognized penalties of $ 1.3 million for each of the years ended December 31, 2022, 2021, 2020.

The Company does not believe that it has any tax position for which it is reasonably possible that it will be required to record significant amounts of unrecognized tax benefits within the next twelve months.

1 unchanged sentence

The Company analyzed its tax filing positions for all federal, state, local and foreign tax jurisdictions where it is required to file income tax returns, as well as for all open tax years in these jurisdictions.

Based on this review, adjustments for uncertain income tax positions of $4.5 million and $3.8 million, exclusive of penalties and interest, were required for each of the years ended December 31, 2021 and 2020, respectively.

In the normal course of business, the Company is subject to examination by U.S.

federal and certain state, local and foreign tax regulators.

At December 31, 2021, the U.S.

federal, state, local and foreign income tax returns for the years 2018 through 2020 are generally open under the normal statute of limitations and therefore subject to examination.

At December 31, 2022, U.S.

federal tax returns related to predecessor entities for the years 2019 through 2021 are generally open under the normal statute of limitations and therefore subject to examination.

State and local tax returns of our predecessor entities are generally open to audit for tax years between 2018 to 2021.

In addition, certain foreign subsidiaries’ tax returns from 2016 to 2021 are also open for examination by various regulators.

The Company files its tax returns as prescribed by the tax laws of the jurisdictions in which it operates.

Although the outcome of tax audits is always uncertain, the Company does not believe the outcome of any future audit will have a material adverse effect on the Company’s Consolidated Financial Statements.

On August 16, 2022, the Inflation Reduction Act of 2022 (“IRA”) was enacted in the United States.

The IRA, among other things, includes a 15% minimum tax on adjusted financial statement income of corporations with average annual adjusted financial statement income in excess of $1 billion over a three-year period, a 1% excise tax on stock repurchases and additional clean energy tax incentives.

The IRA applies to tax years beginning after December 31, 2022.

The Company will continue to evaluate its future impact as regulations are issued by the U.S.

Department of the Treasury.

Sale of non-controlling interests in consolidated entities

1 unchanged sentence

The Holdings Companies received $ 17.5 million in proceeds upon closing with the balance to be paid in equal installments over three years .

The Company received $10.8 million in each of the years ended December 31, 2020 and 2019.

The payments are shown in the Consolidated Statements of Changes in Partners’ Capital.

As of December 31, 2020, the receivable for the sale of non-controlling interests in consolidated entities has been settled in full.

The sale of the equity interests is subject to a put provision whereby, under limited circumstances, the Holdings Companies would be required to repurchase all the equity interest previously sold in excess of any distributions received.

This provision expires in June 2022.

The Company received $ 10.8 million in the year ended December 31, 2020.

The payments are shown in the Consolidated Statements of Changes in Equity.

As of December 31, 2020, the receivable for the sale of non-controlling interests in consolidated entities had been settled in full.

The sale of the equity interests was subject to a put provision whereby, under limited circumstances, the Holdings Companies would be required to repurchase all the equity interest previously sold in excess of any distributions received.

This provision expired in June 2022.

Notes to Consolidated Financial Statements

Related Party Transactions

12 unchanged sentences

Affiliate receivables and payables historically have been settled in the normal course of business without formal payment terms, generally do not require any form of collateral and do not bear interest.

Senior Unsecured Revolving Credit Facility

In March 2011, the Company secured a $400.0 million credit facility on behalf of an affiliate.

In May 2018, the Company entered into an amended and restated Secured Revolving Credit Facility Agreement under which certain terms were modified, including reduced commitments of $300.0 million, an extension of the maturity to May 2023 and certain components of financial covenants were redefined.

In November 2020, the Company entered into an amended and restated Revolving Credit Facility Agreement under which certain terms were modified, including releasing all collateral pledged

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

under the prior Secured Revolving Credit Facility and extending the maturity to November 2025.

The interest rate for borrowings on the credit facility is calculated at the LIBOR rate at the time of the borrowing plus 1.75%.

In November 2021, the Company entered into an amended and restated Revolving Credit Facility Agreement under which certain terms were modified, including that TPG Holdings, L.P.

may elect to have (i) TPG Operating Group II, L.P.

(f/k/a TPG Holdings II, L.P.) assume its obligations as borrower under the Senior Unsecured Revolving Credit Facility and (ii) correspondingly release TPG Operating Group II, L.P., TPG Holdings I-A, LLC, TPG Holdings II-A, LLC and TPG Holdings III-A, L.P from their guarantees of the Senior Unsecured Revolving Credit Facility.

TPG Holdings, L.P.

made such election in conjunction with the Reorganization, upon which TPG Operating Group II, L.P.

assumed its obligations as borrower under the Senior Unsecured Revolving Credit Facility, and TPG Holdings, L.P.

was thereby released from its obligations as borrower thereunder.

Correspondingly, TPG Operating Group II, L.P., TPG Holdings I-A, LLC, TPG Holdings II-A, LLC and TPG Holdings III-A, L.P were released from their guarantees of the Senior Unsecured Revolving Credit Facility.

During the year ended December 31, 2021, the Company made no borrowings and made repayments of $50.0 million on the Revolving Credit Facility to Affiliate, leaving a balance of zero at December 31, 2021.

During the year ended December 31, 2020, the Company borrowed $150.0 million and made repayments of $100.0 million on the credit facility, leaving a balance of $50.0 million at December 31, 2020.

At December 31, 2021 and 2020, $300.0 million and $250.0 million was available to be borrowed under the terms of the credit facility, respectively.

During the years ended December 31, 2021 and 2020, the Company incurred interest expense on the Revolving Credit Facility of $0.6 million and $2.4 million, respectively.

The Company did not incur any interest expense on the Revolving Credit Facility during the year ended December 31, 2019.

Fund Investments

Certain of the Company’s investment professionals and other individuals have made discretionary investments of their own capital in the TPG Funds.

These investments are generally not subject to management fees or carried interest at the discretion of the general partner.

These investments are generally not subject to management fees or performance allocations at the discretion of the general partner.

Investments made by these individuals during the years ended December 31, 2022 and 2021 totaled $ 154.8 million and $ 211.3 million, respectively.

Fee Income from Affiliates

Substantially all revenues are generated from TPG Funds or Portfolio companies.

The Company disclosed revenues in Note 2 .

Substantially all revenues are generated from TPG Funds, limited partners of TPG Funds, or Portfolio Companies.

The Company disclosed revenues in Note 2 to the Consolidated Financial Statements.

Notes Receivable from Affiliates

1 unchanged sentence

Certain of these loans are collateralized by underlying investment interests of the borrowers.

The outstanding balance of these notes was $1.0 million and $18.3 million at December 31, 2021 and 2020, respectively.

These notes generally incur interest at floating rates, and such interest, which is included in interest, dividends and other in the Consolidated Financial Statements, totaled $0.5 million for each of the years ended December 31, 2021 and 2020, and $1.2 million for the year ended December 31, 2019 .

The outstanding balance of these notes was $ 1.6 million and $ 1.0 million at December 31, 2022 and December 31, 2021, respectively.

These notes generally incur interest at floating rates, and such interest, which is included in interest, dividends and other in the Consolidated Financial Statements, totaled less than $ 0.1 million for the year ended December 31, 2022, and $ 0.5 million for each of the years ended December 31, 2021 and 2020 .

Aircraft Services

The Company leases aircraft owned by entities controlled by the Partners of the Company.

Such lease payments, which were paid to entities controlled by the Partners of the Company, totaled $4.9 million for each of the years ended December 31, 2021 and 2020, and $6.8 million for the year ended December 31, 2019.

TPG Group Holdings (SBS), L.P.

The Company terminated its leases of aircraft owned by entities controlled by certain partners of the Company in January 2022.

The termination of the leases resulted in the derecognition of a right-of-use asset and a corresponding lease liability of $ 13.6 million.

For the year ended December 31, 2022, the Company made no lease payments to entities controlled by certain partners of the Company.

For the year ended December 31, 2021, such lease payments, which were paid to entities controlled by certain partners of the Company, totaled $ 4.9 million.

Notes to Consolidated Financial Statements

RemainCo Administrative Services Agreement

The fees earned by the Company for the year ended December 31, 2022 were $ 19.8 million and recorded in expense reimbursements and other within revenues in the Consolidated Financial Statements.

Other Related Party Transactions

The Company has entered into contracts to provide services or facilities for a fee with certain related parties.

A portion of these fees are recognized within expense reimbursements and other in the amount of $21.8 million.

A portion of these fees are recognized within expense reimbursements and other in the amount of $ 23.5 million, $ 21.8 million and $ 16.6 million for the years ended December 31, 2022, 2021 and 2020, respectively.

During the years ended December 31, 2022, 2021 and 2020, these related parties have made payments associated with these arrangements of $ 26.2 million, $ 27.9 million and $ 21.1 million, respectively.

Redeemable equity attributable to consolidated Public SPACs

Investment in SPACs

The Company invests in and sponsors SPACs which are formed for the purposes of effecting a merger, asset acquisition, stock purchase, reorganization or other business combination.

Assets held in Trust Accounts relate to gross proceeds received from the IPO and can only be used for the initial business combination and any possible investor redemptions.

If the SPAC is unable to complete a business combination within a specified time frame, typically within 24 months of the IPO close date, the SPACs will redeem all public shares.

The ownership interest in each SPAC which is not owned by the Company is reflected as redeemable equity attributable to Public SPACs in the accompanying Consolidated Financial Statements.

In August 2021, AFTR, a SPAC, completed an initial public offering.

AFTR sold 25,000,000 units at a price of $ 10.00 per unit for total IPO proceeds of $ 250.0 million.

Each unit consists of one Class A ordinary share of AFTR at $ 0.0001 par value and one-third of one warrant.

In April 2021, YTPG, a SPAC, completed an initial public offering.

YTPG sold 40,000,000 shares at a price of $ 10.00 per share for total IPO proceeds of $ 400.0 million.

Each share consists of one Class A ordinary share of YTPG at $ 0.0001 par value.

Prior to the IPO, YTPG entered into FPAs for an aggregate purchase price of $ 175.0 million, of which the Company is responsible for $ 24.9 million as of December 31, 2022.

In October 2020, TPG PACE Beneficial Finance Corp.

("TPGY”), a SPAC, completed an initial public offering.

TPGY sold 35,000,000 units at a price of $ 10.00 per unit for total IPO proceeds of $ 350.0 million.

Each unit consisted of one Class A ordinary share of TPGY at $ 0.0001 par value and one-fifth of one warrant.

On October 11, 2022, TPGY redeemed all of its Class A Shares at a per-share redemption price of approximately $ 10.06 , because TPGY did not consummate an initial business combination within the time period required by its Amended and Restated Memorandum and Articles of Association.

As of October 11, 2022, the Class A Shares were deemed cancelled and represented only the right to receive the Redemption Amount.

There will be no redemption rights or

Notes to Consolidated Financial Statements

liquidating distributions with respect to the TPGY’s warrants, which expired with no value.

FPAs entered into by TPGY at the time of its IPO were terminated on October 11, 2022.

After October 11, 2022, TPGY ceased all operations except for those required to wind up its business.

Redeemable equity from consolidated Public SPACs

Redeemable equity from consolidated Public SPACs represents the shares issued by the Company’s consolidated Public SPACs that are redeemable for cash in the event of an election to redeem by individual public shareholders at the time of the business combination.

Additionally, these shares become automatically redeemable with the Public SPAC’s failure to complete a business combination, tender offer or stockholder approval provisions.

The ownership interest in each SPAC which is not owned by the Company is reflected as redeemable equity from consolidated Public SPACs in the accompanying Consolidated Financial Statements.

Offering costs related to Class A ordinary shares issued by SPACs consisted of legal, accounting, underwriting fees and other costs incurred that are directly related to the IPO.

Offering costs for the year ended December 31, 2021 totaled approximately $ 54.1 million, inclusive of $ 32.7 million in deferred underwriting commissions, and were charged to redeemable equity.

Offering costs for the year ended December 31, 2020 totaled approximately $ 46.0 million, inclusive of $ 28.0 million in deferred underwriting commissions.

The Company had no such activity for the year ended December 31, 2022.

Approximately $ 44.7 million of the offering costs were related to the issuance of Class A ordinary shares and charged to redeemable equity and approximately $ 1.3 million of the offering costs were related to the warrant liabilities and charged to the Consolidated Statement of Operations.

As of December 31, 2022 and 2021, the redeemable equity consisted of 65.0 million and 100.0 million outstanding Class A ordinary shares, respectively.

These interests were classified outside of partners’ capital totaling $ 653.6 million and $ 1,000.0 million, respectively, which represented the full redemption value and equals the assets held in Trust Accounts.

The following table summarizes the adjustments to redeemable equity (in thousands):

Year Ended December 31,

2022 2021 2020

Beginning balance $ 1,000,027 $ 800,011 $ —

IPO share proceeds — 935,000 800,000

Current and deferred offering costs 12,959 ( 54,141 ) ( 44,702 )

Bifurcation of warrant liabilities — ( 12,500 ) ( 24,000 )

Net income (loss) attributable to redeemable equity 14,648 155,131 ( 195,906 )

Redemptions / withdrawals ( 352,014 ) ( 304,760 ) —

Deconsolidation — ( 430,265 ) —

Change in redemption value of redeemable non-controlling interest ( 21,985 ) ( 88,449 ) 264,619

Total redeemable equity $ 653,635 $ 1,000,027 $ 800,011

Notes to Consolidated Financial Statements

Operating Leases

16 unchanged sentences

Cash paid for amounts included in the measurement of lease liabilities $ 28,458 $ 29,224 $ 29,427

Non-cash right-of-use assets obtained in exchange for new operating lease liabilities (a)

5,634 6,035 120,130

(a) The new operating right of use assets and related liabilities for the year ended December 31, 2019 excludes the initial impacts of the adoption of ASU 2016-02.

The decrease for the year ended December 31, 2020 from the prior year ended December 31, 2019 is due to the timing of the renegotiation of lease contracts approaching expiration.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

Non-cash right-of-use assets obtained in exchange for new operating lease liabilities 6,311 5,634 6,035

Non-cash right-of-use assets and lease liability termination ( 13,375 ) — —

The following table shows the undiscounted cash flows on an annual basis for operating lease liabilities as of December 31, 2022 (in thousands):

5 unchanged sentences

Present value of operating lease liabilities $ 147,887

Notes to Consolidated Financial Statements

Commitments and Contingencies

5 unchanged sentences

December 2024 200,000

November 2025 300,000

June 2026 60,000

December 2026 103,718

July 2027 700,000

June 2030 27,050

Thereafter 50

Total $ 1,120,768

1 unchanged sentence

Letters of Credit

The Company had $0.7 million in letters of credit outstanding at December 31, 2021 and 2020.

The Company had $ 0.5 million and $ 0.7 million in letters of credit outstanding at December 31, 2022 and 2021, respectively.

At December 31, 2022, the third party investors of the consolidated Public SPACs had unfunded capital commitments of $ 150.1 million to the consolidated Public SPACs.

At December 31, 2021, the Holdings Companies had unfunded investment commitments of $339.9 million to the TPG Funds, consolidated Public SPACs and other strategic investments.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

At December 31, 2022, the TPG Operating Group had unfunded investment commitments of $ 365.8 million to the TPG Funds, consolidated Public SPACs and other strategic investments.

Contingent Obligations (Clawback) With Affiliates

The governing agreements of the TPG Funds that pay carried interest generally include a clawback provision that, if triggered, may give rise to a contingent obligation requiring the general partner to return amounts to the fund for distribution to the fund investors at the end of the life of the fund.

Carried interest received by the general partners of the respective TPG Funds is subject to clawback to the extent the carried interest received by the general partners exceeds the amount the general partners are ultimately entitled to receive based on cumulative fund results.

The governing agreements of the TPG funds that pay performance allocations generally include a clawback provision that, if triggered, may give rise to a contingent obligation requiring the general partner to return amounts to the fund for distribution to the fund investors at the end of the life of the fund.

Performance allocations received by the general partners of the respective TPG funds are subject to clawback to the extent the performance allocations received by the general partners exceeds the amount the general partners are ultimately entitled to receive based on cumulative fund results.

At December 31, 2022, if all investments held by the TPG funds were liquidated at their current unrealized fair value, there would be clawback of $ 58.3 million, net of tax, for which a performance fee reserve was recorded within other liabilities in the Consolidated Financial Statements.

At December 31, 2021, if all remaining investments were deemed worthless, a possibility management views as remote, the amount of carried interest subject to potential clawback would be $1,500.9 million on a pre-tax basis.

At December 31, 2022, if all remaining investments were deemed worthless, a possibility management views as remote, the amount of performance allocations subject to potential clawback would be $ 1,869.4 million on a pre-tax basis.

During the year ended December 31, 2022, the general partners made no payments on the clawback liability.

The Company holds additional equity method investments that generate performance fee-based income in which the potential for additional clawback exists, a possibility that management views as unlikely.

The reporting rights of these investments is such that management does not have the ability to estimate potential clawback.

Notes to Consolidated Financial Statements

Legal Actions and Other Proceedings

From time to time, TPG is involved in legal proceedings, litigation and claims incidental to the conduct of our business, including with respect to acquisitions, bankruptcy, insolvency and other types of proceedings.

From time to time, the Company is involved in legal proceedings, litigation and claims incidental to the conduct of our business, including with respect to acquisitions, bankruptcy, insolvency and other types of proceedings.

Such lawsuits may involve claims against our Portfolio Companies that adversely affect the value of certain investments owned by TPG’s funds.

TPG’s business is also subject to extensive regulation, which has and may result in TPG becoming subject to examinations, inquiries and investigations by various U.S.

governmental and regulatory agencies, including but not limited to the SEC, Department of Justice, state attorneys general, Financial Industry Regulatory Authority (“FINRA”), and the U.K.

The Company’s business is also subject to extensive regulation, which has and may result in the Company becoming subject to examinations, inquiries and investigations by various U.S.

governmental and regulatory agencies, including but not limited to the SEC, Department of Justice, state attorneys general, Financial Industry Regulatory Authority and the U.K.

Financial Conduct Authority.

Such examinations, inquiries and investigations may result in the commencement of civil, criminal or administrative proceedings or fines against TPG or its personnel.

TPG accrues a liability for legal proceedings in accordance with Generally Accepted Accounting Principles, in particular, TPG establishes an accrued liability for loss contingencies when a settlement arising from a legal proceeding is both probable and reasonably estimable.

Such examinations, inquiries and investigations may result in the commencement of civil, criminal or administrative proceedings or fines against the Company or its personnel.

The Company accrues a liability for legal proceedings in accordance with U.S.

GAAP, in particular, the Company establishes an accrued liability for loss contingencies when a settlement arising from a legal proceeding is both probable and reasonably estimable.

If the matter is not probable or reasonably estimable, no such liability is recorded.

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Consequently, management is unable to estimate a range of potential loss, if any, related to such matters.

Even when TPG accrues a liability for a loss contingency such cases, there may be an exposure to loss in excess of any amounts accrued.

Even when the Company accrues a liability for a loss contingency such cases, there may be an exposure to loss in excess of any amounts accrued.

Loss contingencies may be, in part or in whole, subject to insurance or other payments such as contributions and/or indemnity, which may reduce any ultimate loss.

3 unchanged sentences

In December 2020, the Company settled the dispute with the Internal Revenue Service by making a payment of approximately $ 7.8 million and recorded additional expenses of $ 0.3 million in general, administrative, and other in the Consolidated Statements of Operations.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

Based on information presently known by management, TPG has not recorded a potential liability related to any pending legal proceeding and is not subject to any legal proceedings that we expect to have a material impact on our operations, financial positions, or cash flows.

Based on information presently known by management, the Company has not recorded a potential liability related to any pending legal proceeding and is not subject to any legal proceedings that we expect to have a material impact on our operations, financial positions or cash flows.

It is not possible, however, to predict the ultimate outcome of all pending legal proceedings, and the claimants in the matter discussed below seek potentially large and indeterminate amounts.

As such, although we do not consider such an outcome likely, given the inherent unpredictability of legal proceedings, it is possible that an adverse outcome in the matter described below or certain other matters could have a material effect on TPG’s financial results in any particular period.

Since 2011, a number of TPG-related entities and individuals, including David Bonderman and Jim Coulter, have been named as defendants/respondents in a series of lawsuits in the US, UK, and Luxembourg concerning an investment TPG held from 2005-2007 in a Greek telecommunications company, known then as TIM Hellas (“Hellas”).

As such, although we do not consider such an outcome likely, given the inherent unpredictability of legal proceedings, it is possible that an adverse outcome in the matter described below or certain other matters could have a material effect on the Company’s financial results in any particular period.

Since 2011, a number of TPG-related entities and individuals, including David Bonderman and Jim Coulter, have been named as defendants/respondents in a series of lawsuits in the United States, United Kingdom, and Luxembourg concerning an investment TPG held from 2005-2007 in a Greek telecommunications company, known then as TIM Hellas (“Hellas”).

Entities and individuals related to Apax Partners, a London based investment firm also invested in Hellas at the time, are named in the suits as well.

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In February 2018, a High Court case in London against a number of TPG and Apax related parties and individuals was abandoned by the claimants in the early days of a scheduled six-week trial with costs of $ 9.5 million awarded to the TPG and Apax-related parties, of which $ 3.4 million was awarded to TPG.

In addition to the Luxembourg appeal, two cases in New York state court are active, and two cases in New York federal court are stayed, against TPG and Apax-related parties concerning the Hellas investment.

Motions to dismiss by all defendants (or appeals and motions to reconsider related thereto) are pending in the two active actions.

TPG believes that the suits related to the Hellas investment are without merit and intends to continue to defend them vigorously.

Notes to Consolidated Financial Statements

In addition to the Luxembourg appeal, two cases in New York state court are active against TPG and Apax-related parties concerning the Hellas investment.

Motions to dismiss by all defendants were made in both actions with the Court now having granted and denied in part those motions, paring back the parties, claims and amounts at issue.

Appeals are pending as to the ruling in one matter (with immediate appeals possible as to the ruling in the other).

No trial date has been set in either of the two active actions.

The prior noted stayed federal actions have now been dismissed by court order and stipulation.

The Company believes that the suits related to the Hellas investment are without merit and intends to continue to defend them vigorously.

In October 2022, the Company received a document request from the SEC focusing on the use and retention of business-related electronic communications, which, as has been publicly reported, is part of an industry-wide review.

The Company is cooperating with the SEC’s request.

Indemnifications

In the normal course of business, TPG enters into contracts that contain a variety of representations and warranties that provide general indemnifications.

In addition, certain of TPG’s funds have provided certain indemnities relating to environmental and other matters and has provided nonrecourse carve-out guarantees for fraud, willful misconduct and other customary wrongful acts, each in connection with the financing of certain real estate investments that TPG has made.

TPG’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against TPG that have not yet occurred.

However, based on experience, TPG expects the risk of material loss to be remote.

Compensation and Benefits

In the normal course of business, the Company enters into contracts that contain a variety of representations and warranties that provide general indemnifications.

In addition, certain of the Company’s funds have provided certain indemnities relating to environmental and other matters and has provided nonrecourse carve-out guarantees for fraud, willful misconduct and other customary wrongful acts, each in connection with the financing of certain real estate investments that the Company has made.

The Company’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Company that have not yet occurred.

However, based on experience, the Company expects the risk of material loss to be remote.

Net Income (Loss) Per Class A Common Share

Basic and diluted net income (loss) per share of Class A common stock is presented from January 13, 2022 through December 31, 2022, the period following the Reorganization and IPO.

There were no shares of Class A common stock outstanding prior to January 13, 2022, therefore no income per share information has been presented for any period prior to that date.

The Company calculates its basic and diluted income (loss) per share using the two-class method for all periods presented, which defines unvested share-based payment awards that contain nonforfeitable rights to dividends as participating securities.

The two-class method is an allocation formula that determines income per share for each share of common stock and participating securities according to dividends declared and participation rights in undistributed earnings.

Under this method, all income (distributed and undistributed) is allocated to common shares and participating securities based on their respective rights to receive dividends.

In computing the dilutive effect that the exchange of TPG Operating Group partnership units would have on net income available to Class A common stock per share, TPG considered that net income (loss) available to holders of shares of Class A common stock would increase due to the elimination of non-controlling interests in the TPG Operating Group, inclusive of any tax impact.

The hypothetical conversion may be dilutive to the extent there is activity at the TPG Inc.

level that has not previously been attributed to the non-controlling interests or if there is a change in tax rate as a result of a hypothetical conversion.

Notes to Consolidated Financial Statements

The following table sets forth reconciliations of the numerators and denominators used to compute basic and diluted net income (loss) per share of Class A common stock (in thousands, except share and per share data):

Year Ended December 31, 2022

Net income (loss) $ ( 56,235 )

Net loss attributable to redeemable equity in Public SPACs prior to IPO ( 517 )

Net income attributable to other non-controlling interests prior to Reorganization and IPO 966

Net income attributable to TPG Group Holdings prior to Reorganization and IPO 5,256

Net income (loss) subsequent to IPO ( 61,940 )

Net income attributable to redeemable equity in Public SPACs subsequent to IPO 15,165

Net loss attributable to non-controlling interests in TPG Operating Group subsequent to IPO ( 180,824 )

Net income attributable to other non-controlling interests subsequent to IPO 11,293

Net income attributable to Class A Common Stockholders prior to distributions 92,426

Reallocation of earnings to unvested participating restricted stock units ( 4,994 )

Net income attributable to Class A Common Stockholders - Basic 87,432

Net loss assuming exchange of non-controlling interest ( 147,133 )

Reallocation of income from participating securities assuming exchange of Common Units 132

Net income (loss) attributable to Class A Common Stockholders - Diluted $ ( 59,569 )

Weighted-Average Shares of Common Stock Outstanding - Basic 79,255,411

Exchange of Common Units to Class A Common Stock 229,652,641

Weighted-Average Shares of Common Stock Outstanding - Diluted 308,908,052

Net income (loss) available to Class A common stock per share

Diluted $ ( 0.19 )

Dividends declared per share of Class A Common Stock (a)

(a) Dividends declared reflects the calendar date of the declaration for each distribution.

The fourth quarter dividends were declared on February 15, 2023 and are payable on March 10, 2023.

Equity-Based Compensation

In conjunction with the IPO, TPG employees, certain of the Company’s executives and certain non-employees received grants of equity-based awards in the form of restricted stock units which entitle the holder to one share of Class A common stock upon vesting.

These grants were issued as part of the IPO to promote broad ownership of the firm among its employees and further align its interests with those of its shareholders.

As a result of the Reorganization and the IPO, the Company’s current partners hold restricted indirect interests in Common Units through TPG Partner Holdings, L.P.

(“TPG Partner Holdings”) and indirect economic interests through RemainCo.

In conjunction with the Reorganization, TPG Partner Holdings distributed its interest in RemainCo and the underlying assets as part of a common control transaction to its existing owners, which are the Company’s current and former partners.

No changes were made to the terms of the unvested units.

TPG Partner Holdings and RemainCo are presented as non-controlling interest holders within our Consolidated Financial Statements.

The interests in TPG Partner Holdings (“TPH Units”) and indirectly in RemainCo (“RPH Units”) are generally subject to both service-based vesting, primarily over a four to seven-year period from the date of grant or, in certain cases, to performance conditions.

Holders of these interests participate in distributions regardless of

Notes to Consolidated Financial Statements

the vesting status.

Additionally, as a result of the Reorganization, the IPO and the acquisition of the final 33.3 % of NQ Manager discussed in Note 3 to the Consolidated Financial Statements, certain TPG partners and NewQuest principals were granted Common Units directly at TPG Operating Group (“TOG Units”) and Class A common stock (collectively with “TOG Units,” the “Other IPO-Related Awards”) subject to both service and performance conditions, which are deemed probable of achieving.

The following table summarizes the granted and outstanding awards for the year ended December 31, 2022 (in millions, including share data):

Shares / Units Granted for the year ended December 31, 2022 Shares / Units Outstanding as of

December 31, 2022 Compensation Expense for the year ended December 31, 2022 Unrecognized Compensation Expense as of December 31, 2022

Restricted Stock Units

IPO Service-Vesting Awards 10.2 9.4 $ 68.9 $ 215.5

IPO Executive Service-Vesting Awards 1.1 1.1 6.3 26.2

IPO Executive Performance Condition Awards 1.1 1.1 5.2 13.0

Ordinary Service-Vesting Awards 0.7 0.7 2.8 16.0

Ordinary Performance-Vesting Awards 0.1 0.1 0.6 3.0

Total Restricted Stock Units 13.2 12.4 $ 83.8 $ 273.7

Other IPO-Related Awards

Unvested TOG Common Units 2.4 2.2 $ 24.3 $ 40.9

Unvested Class A Common Stock 1.8 1.7 17.1 35.1

Total Other IPO-Related Awards 4.2 3.9 $ 41.4 $ 76.0

Unvested Units at IPO Unvested Units Outstanding as of

December 31, 2022 Compensation Expense for the year ended December 31, 2022 Unrecognized Compensation Expense as of December 31, 2022

TPH and RPH Units

TPH units 66.6 50.3 $ 426.9 $ 1,211.6

RPH units 0.6 0.4 81.7 209.7

Total TPH and RPH Units 67.2 50.7 $ 508.6 $ 1,421.3

Restricted Stock Units

Under the Company’s 2021 Omnibus Equity Incentive Plan (the “Omnibus Plan”), the Company is permitted to grant equity awards representing ownership interests in TPG Inc.’s Class A common stock.

On January 13, 2022, the Omnibus Plan became effective and the Company authorized for issuance 30,694,780 shares of TPG Inc.’s Class A common stock, which, pursuant to the Omnibus Plan’s evergreen provision, such share reserve was increased to 43,492,763 shares of TPG Inc.’s Class A common stock on January 6, 2023.

For the year ended December 31, 2022, the Company recorded equity-based compensation expense o f $ 83.8 million.

IPO and Ordinary Service-Vesting Awards

Under the Omnibus Plan, the Company granted equity awards that are subject to service-based vesting, primarily over a four to six-year period from the date of grant (“Service-Vesting Awards”).

Holders of the Service-Vesting Awards participate in dividends whether the awards are unvested or vested.

Notes to Consolidated Financial Statements

The Company awarded 10.2 million of restricted stock units to employees and certain non-employees of the Company in conjunction with the IPO.

Additionally, for the year ended December 31, 2022, the Company issued 0.7 million of ordinary Service-Vesting Awards.

The related expense associated with awards granted to certain non-employees of the Company is recognized in general, administrative and other in our Consolidated Statements of Operations and totaled $ 7.1 million for the year ended December 31, 2022 .

This excludes 2.2 million of restricted stock units granted to certain executives (“Executive Awards”) in conjunction with the IPO.

The fair value is based on the grant date fair value, which considers the public share price of the Company’s Class A common stock.

The following table presents the rollforward of the Company’s unvested Service-Vesting Awards for the year ended December 31, 2022 (awards in millions):

Service-Vesting Awards Weighted-Average Grant Date Fair Value

Balance at December 31, 2021 — $ —

Granted 10.9 29.42

Vested, settled ( 0.2 ) 29.50

Forfeited ( 0.6 ) 29.48

Balance at December 31, 2022 10.1 $ 29.41

As of December 31, 2022, there was approximately $ 231.5 million of total estimated unrecognized compensation expense related to unvested Service-Vesting Awards, which is expected to be recognized over the weighted average remaining requisite service period of 3.5 years.

Subsequent to December 31, 2022, we gra nted 3.7 million in O rdinary Service-Vesting Awards.

The units will vest in equal tranches over a period of three years .

Ordinary Performance-Vesting Awards

Under the Omnibus Plan, the Company also granted 0.1 million of ordinary equity awards that are subject to both service and performance conditions (“Performance-Vesting Awards”).

The weighted-average grant date fair value per share was $ 26.93 for these awards.

For year ended December 31, 2022, the Company recorded equity-based compensation expense of $ 0.6 million.

Further, as of December 31, 2022, there was approximately $ 3.0 million of total estimated unrecognized compensation expense related to unvested Performance-Vesting Awards, which is expected to be recognized over the weighted average remaining requisite service period of 3.1 years.

IPO Executive Awards

Under the Omnibus Plan, the Company also granted 2.2 million of Executive Awards in order to incentivize and retain key members of management and further their alignment with our shareholders in conjunction with the IPO.

The Executive Awards includes awards of (i) 1.1 million restricted stock units subject to service-based vesting over a five-year service period beginning with the second anniversary of the grant date (“Executive Service-Vesting Awards”) and (ii) 1.1 million market and service based restricted stock units (“Executive Performance Condition Awards”).

Each Executive Performance Condition Award is comprised of two parts:

(i) a time-based component requiring a five-year service period (“Type I”) and (ii) a market price component with a target Class A common stock share price at either $ 44.25 within five years or $ 59.00 within eight years (“Type II”).

Dividend equivalents are paid on vested and unvested Executive Service-Vesting Awards when the dividend occurs.

Dividend equivalents accrue for vested and unvested Executive Performance Condition Awards and are paid only when both the applicable service and performance conditions are satisfied.

The fair value of the Executive Service-Vesting Awards, $ 32.5 million, is based on the grant date fair value, which considers the public share price of the Company’s Class A common stock.

Compensation expense for those awards is recognized on a straight-line basis.

The grant date fair value of the Executive Performance Condition Awards made during the year ended December 31, 2022 was $ 18.2 million and was based on a Monte-Carlo simulation valuation model.

Compensation expense for those awards is recognized using the accelerated attribution method on a tranche by tranche basis.

Notes to Consolidated Financial Statements

The following table presents the rollforwards of the Company’s unvested Executive Awards for the year ended December 31, 2022 (awards in millions):

Executive Service-Vesting Awards Grant Date Fair Value Executive Performance Condition Awards Weighted Average Grant Date Fair Value

Balance at December 31, 2021 — $ — — $ —

Granted 1.1 29.50 1.1 16.58

Vested — — — —

Forfeited — — — —

Balance at December 31, 2022 1.1 $ 29.50 1.1 $ 16.58

Below is a summary of the grant date fair value based on the Monte-Carlo simulation valuation model.

Vesting Condition Grant Date Fair Value

Type I $ 17.58

Type II $ 15.59

Significant Assumptions Type I Type II

TPG Class A common stock share price as of valuation date $ 29.50 $ 29.50

Volatility 35.0 % 35.0 %

Dividend Yield 4.0 % 4.0 %

Risk-free rate 1.46 % 1.65 %

Cost of Equity 10.7 % 10.7 %

As of December 31, 2022 , there was approximately $ 26.2 million of total estimated unrecognized compensation expense related to unvested Executive Service-Vesting Awards, which is expected to be recognized over the weighted average remaining requisite service period of 4.0 years.

There was approximately $ 13.0 million of unrecognized compensation expense related to unvested Executive Performance Condition Awards, which is expected to be recognized over the weighted average remaining requisite service period of 2.8 years.

TPH and RPH Awards

We account for the TPH Units and RPH Units as compensation expense in accordance with ASC Topic 718, Compensation – Stock Compensation (“ASC 718”).

The unvested TPH and RPH Units are recognized as equity-based compensation subject to primarily service vesting conditions and in certain cases performance conditions, which are currently deemed probable of achieving.

The Company recognized compensation expense of $ 508.6 million for the year ended December 31, 2022.

The Company had no such compensation expense for the year ended December 31, 2021.

There is no additional dilution to our stockholders related to these interests.

Contractually these units are only related to non-controlling interest holders of the TPG Operating Group, and there is no impact to the allocation of income and distributions to TPG Inc.

Therefore, we have allocated these expense amounts to our non-controlling interest holders.

Notes to Consolidated Financial Statements

The following table presents the rollforwards of the Company’s unvested TPH Units and RPH Units for the period commencing on January 13, 2022 and ending on December 31, 2022 (units in millions):

TPH Units RPH Units

Partnership Units Grant Date Fair Value Partnership Units Grant Date Fair Value

Balance at January 13, 2022 34.0 $ 23.60 0.6 $ 457.10

Granted 34.2 25.06 — —

Vested ( 17.4 ) 24.41 ( 0.2 ) 457.10

Forfeited ( 0.5 ) 24.78 — —

Balance at December 31, 2022 50.3 $ 24.38 0.4 $ 457.10

As of December 31, 2022, there was approximately $ 1,421.3 million of total estimated unrecognized compensation expense related to unvested TPH and RPH Units.

Other IPO-Related Awards

In accordance with ASC 718 the Other IPO-Related Awards are also recognized as equity-based compensation.

The expense for the year ended December 31, 2022 totaled $ 41.4 million.

The Company had no such expense for the year ended December 31, 2021.

As TPG Operating Group holders would accrete pro-rata or benefit directly upon forfeiture of those awards, this compensation expense was allocated pro-rata to all controlling and non-controlling interest holders of TPG Inc.

The weighted average grant date fair value of the TOG Units was $ 27.29 and of Class A common stock was $ 29.50 .

Total unrecognized compensation expense related to outstanding unvested awards as of December 31, 2022 was $ 76.0 million, of which our TOG Units and Class A common stock represented $ 40.9 million and $ 35.1 million, respectively.

Other compensation matters

TPG provides voluntary defined contribution plans for its U.S.

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The Company incurred discretionary bonus expense of $ 205.4 million, $ 340.9 million and $ 293.9 million for the years ended December 31, 2022, 2021 and 2020, respectively.

Certain employees of the Company receive awards from TPG Real Estate Finance Trust, Inc.

Certain employees of the Company receive awards from TPG RE Finance Trust, Inc.

(“TRTX”), a publicly traded real estate investment trust, externally managed and advised by TPG RE Finance Trust Management, L.P., a wholly-owned subsidiary of the Company, for services provided to TRTX.

Generally, these awards vest over four years for employees and at grant date for directors of TRTX.

TPG Group Holdings (SBS), L.P.

Notes to Consolidated Financial Statements

The awards granted to certain employees of the Company are recorded in other assets and due to affiliates on grant date in the Consolidated Statements of Financial Condition.

The awards granted to certain employees of the Company are recorded in other assets and due to affiliates on the grant date in the Consolidated Statements of Financial Condition.

The grant date fair value of the asset is amortized through compensation and benefits expense on a straight-line basis over the vesting period in the Consolidated Statements of Operations.

Compensation and benefits expense is offset by related management fees earned by the Company from TRTX.

During the year ended December 31, 2021, the Company recognized $9.5 million of management fees and compensation and benefits expense.

Redeemable Equity (see Note 2 – Special Purpose Acquisition Companies)

Additionally, these shares become automatically redeemable with the Public SPAC’s failure to complete a business combination, tender offer, or stockholder approval provisions.

The ownership interest in each SPAC which is not owned by the Company is reflected as redeemable equity from consolidated Public SPACs in the accompanying Consolidated Financial Statements.

Offering costs related to Class A ordinary shares issued by SPACs consisted of legal, accounting, underwriting fees and other costs incurred that are directly related to the IPO of units.

Offering costs for the year ended December 31, 2021 totaled approximately $54.1 million, inclusive of $32.7 million in deferred underwriting commissions, and were charged to redeemable equity.

Offering costs for the year ended December 31, 2020 totaled approximately $46.0 million, inclusive of $28.0 million in deferred underwriting commissions.

Approximately $44.7 million of the offering costs were related to the issuance of Class A ordinary shares and charged to redeemable equity and approximately $1.3 million of the offering costs were related to the warrant liabilities and charged to the Consolidated Statement of Operations.

As of December 31, 2021 and 2020, the redeemable equity consisted of 100.0 million and 80.0 million outstanding Class A ordinary shares, respectively.

These interests were classified outside of partners’ capital totaling $1,000.0 million and $800.0 million, respectively, which represented the full redemption value and equals the assets held in Trust Accounts.

The following table summarizes the adjustments to redeemable equity (in thousands):

Year Ended December 31,

2021 2020 2019

Beginning balance $ 800,011 $ — $ 456,920

IPO share proceeds 935,000 800,000 —

Current and deferred offering costs (54,141) (44,702) 4,000

Bifurcation of warrant liabilities (12,500) (24,000) —

Net income (loss) attributable to redeemable equity 155,131 (195,906) (9,684)

Redemptions / withdrawals (304,760) — (269,695)

Deconsolidation (430,265) — (193,727)

Change in redemption value of redeemable non-controlling interest

(88,449) 264,619 12,186

Total redeemable equity $ 1,000,027 $ 800,011 $ —

Other Non-Controlling Interests

Other non-controlling interests consist of:

• Non-controlling interests held by TPG Affiliated Partners – ownership interests in certain consolidated entities held by various TPG affiliated partners

• Non-controlling interests held by investors – ownership interests in the Holdings Companies held by investors otherwise unaffiliated with TPG

TPG Group Holdings (SBS), L.P.

During the year ended December 31, 2022, the Company recognized less than $ 0.01 million of management fees and compensation and benefits expense.

For the year ended December 31, 2021, the Company recognized $ 9.5 million of such expense.

Notes to Consolidated Financial Statements

Partners’ capital attributable to other non-controlling interests consisted of the following (in thousands):

TPG affiliated partners $ 4,338,377 $ 1,601,037

Investors 316,444 454,249

Other non-controlling interests $ 4,654,821 $ 2,055,286

Net income (loss) attributable to other non-controlling interests was as follows (in thousands):

Year Ended December 31,

2021 2020 2019

TPG affiliated partners $ 2,081,170 $ 548,504 $ 561,189

Investors 374,655 171,136 90,369

Income attributable to other non-controlling interests $ 2,455,825 $ 719,640 $ 651,558

Regulated Entities

At December 31, 2021, the Company consolidates a registered broker-dealer subsidiary that is subject to the minimum net capital requirements of the SEC and FINRA which may restrict the Company’s ability to withdraw funds from the broker-dealer.

The broker-dealer has continuously operated in excess of its minimum net capital requirements.

Certain other U.S.

entities are subject to various investment adviser, commodity pool operator and trader regulations.

This includes a number of U.S.

entities that are registered as investment advisers with the SEC.

The Company has two classes of common stock outstanding, Class A common stock and Class B common stock.

Class A common stock is traded on the Nasdaq Global Select Market.

The Company is authorized to issue 2,240,000,000 shares of Class A common stock with a par value of $ 0.001 per share, 100,000,000 shares of nonvoting Class A common stock, 750,000,000 shares of Class B common stock with a par value of $ 0.001 per share, and 25,000,000 shares of preferred stock, with a par value of $ 0.001 per share.

Each share of the Company’s Class A common stock entitles its holder to one vote, and each share of our Class B common stock entitles its holder to ten votes.

Holders of Class A common stock and Class B common stock generally vote together as a single class on all matters presented to the Company’s stockholders for their vote or approval.

The nonvoting Class A common stock have the same rights and privileges as, rank equally and share ratably with, and are identical in all respects as to all matters to, the Class A common stock, except that the nonvoting Class A common stock have no voting rights other than such rights as may be required by law.

Holders of Class A common stock are entitled to receive dividends when and if declared by the board of directors.

Holders of the Class B common stock are not entitled to dividends in respect of their shares of Class B common stock.

As of December 31, 2022, 79,240,058 shares of Class A common stock were outstanding, 229,652,641 shares of Class B common stock were outstanding, and there were no shares of preferred stock outstanding.

Dividends and distributions are reflected in the Consolidated Statements of Stockholders’ Equity when declared by the board of directors.

Dividends are made to Class A common stockholders and distributions are made to holders of non-controlling interests in subsidiaries.

The following is a summary of cash dividends declared per share on the Company’s Class A common stock during the year ended December 31, 2022:

Date Declared Record Date Payment date Dividend per Class A Common Share

May 10, 2022 May 20, 2022 June 3, 2022 $ 0.44

August 9, 2022 August 19, 2022 September 2, 2022 $ 0.39

November 9, 2022 November 21, 2022 December 2, 2022 $ 0.26

On February 15, 2023, the Company’s board of directors declared and approved a cash dividend for the fourth quarter of 2022 of $ 0.50 per share of Class A common stock of record at the close of business on February 27, 2023, payable on March 10, 2023.

Subsequent Events

In January 2022, TPG Inc.

granted the following stock-based awards in connection with its IPO:

• 8.3 million restricted stock units (“RSUs”) with a grant date fair value of $243.4 million which are generally satisfied over four years.

Other than the Reorganization and IPO described in Note 1 , the acquisition of remaining equity interests in NQ Manager described in Note 3 and the event described above, there are no additional subsequent events through the date of issuance of the consolidated financial statements which require adjustment or disclosure.

Other than the events noted in Note 20 and Note 21 to the Consolidated Financial Statements, there have been no additional events since December 31, 2022 that require recognition or disclosure in the Consolidated Financial Statements.

Changes in and Disagreements With Accountants on Accounting and Financial Disclosures

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