What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2024-02-26 compared with 2023-03-01 · 280 added, 358 removed, 1269 unchanged (33% of the section changed)

4 unchanged sentences

Consolidated Statements of Income (Loss) 43

Consolidated Statements of Comprehensive Income 38

Consolidated Statements of Comprehensive Income (Loss)

Consolidated Balance Sheets 45

8 unchanged sentences

Financial information included elsewhere in this report is consistent with that in the financial statements.

PricewaterhouseCoopers LLP, an independent registered public accounting firm, has audited the company’s 2022 consolidated financial statements.

Grant Thornton LLP, an independent registered public accounting firm, has audited the company’s 2023 consolidated financial statements.

Its accompanying report is based on an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States).

1 unchanged sentence

The Audit and Finance Committee meets regularly with the independent registered public accounting firm, representatives of management, and the internal auditors to review the activities of each and to assure that each is properly discharging its responsibilities.

To ensure complete independence, the internal auditors and representatives of PricewaterhouseCoopers LLP have full access to meet with the Audit and Finance Committee, with or without management representatives present, to discuss the results of their audits and their observations on the adequacy of internal controls and the quality of financial reporting.

To ensure complete independence, the internal auditors and representatives of Grant Thornton LLP have full access to meet with the Audit and Finance Committee, with or without management representatives present, to discuss the results of their audits and their observations on the adequacy of internal controls and the quality of financial reporting.

Management’s Report on Internal Control Over Financial Reporting

9 unchanged sentences

Management assessed the effectiveness of the company’s internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Based on this assessment, we identified material weaknesses in the company’s internal control over financial reporting.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of a company’s annual or interim financial statements will not be prevented or detected on a timely basis.

Management concluded that our internal control over financial reporting was not effective as of December 31, 2022.

The company did not design and maintain effective formal policies and procedures to ensure appropriate information is communicated from the IT function and the legal and compliance function to the accounting function and those responsible for governance on a timely basis so as to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

These material weaknesses did not result in a misstatement of the company’s financial statements, however, they could have resulted in misstatements of interim or annual consolidated financial statements and disclosures that would result in a material misstatement that would not be prevented or detected.

The effectiveness of our internal control over financial reporting as of December 31, 2022, has been audited by PricewaterhouseCoopers LLP, our independent registered public accounting firm, as stated in their report, which is included herein.

Status of Remediation Plan for Material Weaknesses

Management has implemented measures designed to ensure that the material weaknesses are remediated.

The company has taken the following remediation steps during the fourth quarter of 2022:

• The company enhanced its written policy regarding information escalation for cyber-incidents.

In addition, the company completed an assessment of staffing within the company’s incident response team.

• The company enhanced its disclosure committee (the Disclosure Committee) and the disclosure working group that supports the Disclosure Committee.

• The company is requiring all direct reports to the CEO to confirm that they have made the Disclosure Committee aware of any matters under their purview that the Disclosure Committee should be considering in advance of applicable SEC filings.

• The company provided training and policies (including any policy revisions) to non-finance executives regarding escalation of significant matters related to SEC reporting requirements.

• Procedures were drafted to address the proper handling of information so that the Security and Risk Committee and Audit and Finance Committee are properly informed.

• Management has revised its Speak Up Policy to make all associates aware that they have direct access to, and may approach, company executives and the Board of Directors, and that they have access to the company’s whistleblower hotline.

As of December 31, 2022, management has implemented all remedial actions described above in respect to the material weaknesses relating to policies and procedures within the IT function and the legal and compliance function to the accounting function.

Due to the timing of the design and implementation of these remediation efforts during the fourth quarter of 2022, there has been insufficient time for the company to demonstrate consistent execution against all newly implemented actions.

As such, management is unable to conclude on the operating effectiveness of implemented remediations at December 31, 2022.

We expect to continue to enhance these controls and assess their operating effectiveness in 2023.

Based on this assessment, we concluded that the company maintained effective internal control over financial reporting as of December 31, 2023, based on the specified criteria.

The effectiveness of our internal control over financial reporting as of December 31, 2023, has been audited by Grant Thornton LLP, our independent registered public accounting firm, as stated in their report, which is included herein.

Altabef /s/ Debra McCann

3 unchanged sentences

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of Unisys Corporation

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of Unisys Corporation and its subsidiaries (the “Company”) as of December 31, 2022 and 2021, and the related consolidated statements of income (loss), of comprehensive income, of equity (deficit) and of cash flows for each of the three years in the period ended December 31, 2022, including the related notes and schedule of valuation and qualifying accounts for each of the three years in the period ended December 31, 2022 appearing after the signatures page (collectively referred to as the “consolidated financial statements”).

We also have audited the Company's internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above 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.

Also in our opinion, the Company did not maintain, in all material respects, effective internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO because material weaknesses in internal control over financial reporting existed as of that date related to the design and maintenance of effective formal policies and procedures to ensure appropriate information is communicated from the IT function and the legal and compliance function to the accounting function and those responsible for governance on a timely basis.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis.

The material weaknesses referred to above are described in the accompanying Management’s Report on Internal Control Over Financial Reporting.

We considered these material weaknesses in determining the nature, timing, and extent of audit tests applied in our audit of the 2022 consolidated financial statements, and our opinion regarding the effectiveness of the Company’s internal control over financial reporting does not affect our opinion on those consolidated financial statements.

Basis for Opinions

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting.

Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits.

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.

Board of Directors and Stockholders

Unisys Corporation

Opinion on the financial statements

We have audited the accompanying consolidated balance sheet of Unisys Corporation (a Delaware corporation) and subsidiaries (the “Company”) as of December 31, 2023, the related consolidated statements of income (loss), comprehensive income (loss), equity (deficit), and cash flows for the year ended December 31, 2023, and the related notes and financial statement schedule included under Item 15(a) (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, 2023, and the results of its operations and its cash flows for the year ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Company’s internal control over financial reporting as of December 31, 2023, based on criteria established in the 2013 Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”), and our report dated February 26, 2024 expressed an unqualified opinion.

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 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 audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated 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 consolidated financial statements.

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

Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.

Our audits also included performing such other procedures as we considered necessary in the circumstances.

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

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.

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 provides a reasonable basis for our opinion.

Critical audit matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that:

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

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.

Goodwill impairment assessment for Digital Workspace Solutions

As disclosed in Note 14 to the consolidated financial statements, the Company’s consolidated goodwill balance related to the Digital Workspace Solutions (“DWS”) reporting unit was $140.8 million as of December 31, 2023.

Management evaluates goodwill for impairment annually on October 1st of each year or whenever events or changes in circumstances indicate potential impairment has occurred.

We identified the Company’s determination of the fair value of the DWS reporting unit as part of its annual goodwill impairment test as a critical audit matter.

The principal considerations for our determination that the estimation of the fair value of the reporting unit is a critical audit matter are that there are significant judgments required by management when determining the fair value of the reporting unit using the income approach.

In particular, the fair value estimate was sensitive to assumptions used to estimate future revenues and cash flows, including revenue growth rates, gross margin, and the discount rate, applied by the Company.

Our audit procedures related to the estimation of the fair value of the reporting unit included the following, among others:

• We tested the effectiveness of controls relating to management’s review of the assumptions used to develop the future cash flows, the discount rate used, and valuation methodologies applied.

• Evaluated the reasonableness of management’s forecasted financial results by:

◦ Assessing the reasonableness of management’s long term growth rates, by comparing the rates to industry projections and conditions found in industry reports and

◦ Testing forecasted revenues and expected future cash flows by comparing forecasted amounts to actual historical results to identify significant changes, and corroborating the basis for such changes, as applicable.

• Utilized an internal valuation specialist to evaluate:

◦ The methodologies used and whether they were acceptable for the underlying assets or operations and whether such methodologies were being applied correctly, and

◦ The appropriateness of the discount rate by developing an independent range of acceptable discount rates and comparing those ranges to the amounts selected and applied by management.

/s/ GRANT THORNTON LLP

We have served as the Company’s auditor since 2023.

Philadelphia, Pennsylvania

February 26, 2024

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board of Directors and Stockholders

Unisys Corporation

Opinion on internal control over financial reporting

We have audited the internal control over financial reporting of Unisys Corporation (a Delaware corporation) and subsidiaries (the “Company”) as of December 31, 2023, based on criteria established in the 2013 Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”).

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on criteria established in the 2013 Internal Control—Integrated Framework issued by COSO.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidated financial statements of the Company as of and for the year ended December 31, 2023, and our report dated February 26, 2024 expressed an unqualified opinion on those financial statements.

Basis for opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control Over Financial Reporting.

Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

We are a public accounting firm registered with the 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 effective internal control over financial reporting was maintained in all material respects.

Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances.

We believe that our audit provides a reasonable basis for our opinion.

Definition and limitations of internal control over financial reporting

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

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

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

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

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

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

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

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

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

Critical Audit Matters

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

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

Valuation of the U.S.

and Certain International Defined Benefit Pension Plan Obligations

As described in Notes 1 and 18 to the consolidated financial statements, the Company’s consolidated defined benefit pension plan obligation was $4,428 million as of December 31, 2022.

Management develops the actuarial assumptions used by its U.S.

and international defined benefit pension plan obligations based upon the circumstances of each particular plan.

The determination of the defined benefit pension plan obligations requires the use of estimates.

Management’s significant assumption used in the determination of the defined benefit pension plan obligations with respect to the U.S.

pension plans, is the discount rate.

The principal considerations for our determination that performing procedures relating to the valuation of the U.S.

and certain international defined benefit pension plan obligations is a critical audit matter are the (i) significant judgment by management to determine the defined benefit pension plan obligations;

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

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

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

These procedures included testing the effectiveness of controls relating to the valuation of the U.S.

and certain international defined benefit pension plan obligations, including controls over the Company’s methods, significant assumption, and data.

These procedures also included, among others, testing the completeness, accuracy and relevance of the underlying data used in developing the estimate, and the involvement of professionals with specialized skill and knowledge to assist in (i) evaluating the appropriateness of the actuarial methods used to estimate the defined benefit pension plan obligations, and (ii) evaluating the reasonableness of management’s significant assumption related to the discount rate.

Evaluating the reasonableness of management’s significant assumption related to the discount rate included (i) developing an independent range of discount rates for each U.S.

and certain international defined benefit pension plan obligations based on publicly available market data for high-quality, fixed income investments, and (ii) comparing management’s discount rate to the independently developed range to evaluate the reasonableness of the discount rate assumption.

/s/ GRANT THORNTON LLP

Philadelphia, Pennsylvania

February 26, 2024

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of Unisys Corporation

Opinion on the Financial Statements

We have audited the consolidated balance sheet of Unisys Corporation and its subsidiaries (the “Company”) as of December 31, 2022, and the related consolidated statements of income (loss), of comprehensive income, of equity (deficit) and of cash flows for each of the two years in the period ended December 31, 2022, including the related notes and schedule of valuation and qualifying accounts for each of the two years in the period ended December 31, 2022 appearing after the signatures page (collectively referred to as the “consolidated financial statements”).

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

Basis for Opinion

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

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

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

We conducted our audits of these consolidated financial statements 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 consolidated financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated 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 consolidated financial statements.

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

/s/ PricewaterhouseCoopers LLP

1 unchanged sentence

March 1, 2023

We have served as the Company’s auditor since 2020.

We served as the Company’s auditor from 2020 to 2022.

UNISYS CORPORATION

16 unchanged sentences

Other (expense), net ( 393.9 ) ( 82.4 ) ( 580.3 )

Loss from continuing operations before income taxes ( 62.6 ) ( 461.7 ) ( 271.8 )

Loss before income taxes ( 347.8 ) ( 62.6 ) ( 461.7 )

Provision for (benefit from) income taxes 79.3 42.3 ( 11.9 )

Consolidated net loss from continuing operations ( 104.9 ) ( 449.8 ) ( 317.2 )

Consolidated net loss ( 427.1 ) ( 104.9 ) ( 449.8 )

Net income (loss) attributable to noncontrolling interests 3.6 1.1 ( 1.3 )

Net loss from continuing operations attributable to Unisys Corporation ( 106.0 ) ( 448.5 ) ( 317.7 )

Income from discontinued operations, net of tax — — 1,068.4

Net (loss) income attributable to Unisys Corporation $ ( 106.0 ) $ ( 448.5 ) $ 750.7

Earnings (loss) per common share attributable to Unisys Corporation

Continuing operations $ ( 1.57 ) $ ( 6.75 ) $ ( 5.05 )

Discontinued operations — — 16.98

Total $ ( 1.57 ) $ ( 6.75 ) $ 11.93

Continuing operations $ ( 1.57 ) $ ( 6.75 ) $ ( 5.05 )

Discontinued operations — — 16.98

Total $ ( 1.57 ) $ ( 6.75 ) $ 11.93

Net loss attributable to Unisys Corporation $ ( 430.7 ) $ ( 106.0 ) $ ( 448.5 )

Loss per share attributable to Unisys Corporation

$ ( 6.31 ) $ ( 1.57 ) $ ( 6.75 )

See notes to consolidated financial statements.

UNISYS CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Year ended December 31, 2023 2022 2021

Consolidated net loss from continuing operations $ ( 104.9 ) $ ( 449.8 ) $ ( 317.2 )

Income from discontinued operations, net of tax — — 1,068.4

Total ( 104.9 ) ( 449.8 ) 751.2

Consolidated net loss $ ( 427.1 ) $ ( 104.9 ) $ ( 449.8 )

Other comprehensive income

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Total other comprehensive income 249.0 174.2 681.3

Comprehensive income 69.3 231.5 907.4

Comprehensive (loss) income ( 178.1 ) 69.3 231.5

Comprehensive (loss) income attributable to noncontrolling interests ( 23.1 ) ( 12.8 ) 4.6

Comprehensive income attributable to Unisys Corporation $ 82.1 $ 226.9 $ 899.8

Comprehensive (loss) income attributable to Unisys Corporation $ ( 155.0 ) $ 82.1 $ 226.9

See notes to consolidated financial statements.

24 unchanged sentences

Total assets $ 1,965.4 $ 2,065.6

Total liabilities and equity (deficit)

Total liabilities and (deficit) equity

Current liabilities:

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Commitments and contingencies (see Note 18)

Equity (deficit):

(Deficit) equity:

Common stock, par value $ .01 per share ( 150.0 shares authorized;

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Noncontrolling interests 13.4 36.5

Total equity (deficit) 21.8 ( 64.4 )

Total liabilities and equity (deficit) $ 2,065.6 $ 2,419.5

Total (deficit) equity ( 138.4 ) 21.8

Total liabilities and (deficit) equity $ 1,965.4 $ 2,065.6

See notes to consolidated financial statements.

3 unchanged sentences

Cash flows from operating activities

Consolidated net loss from continuing operations $ ( 104.9 ) $ ( 449.8 ) $ ( 317.2 )

Income from discontinued operations, net of tax — — 1,068.4

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

Gain on sale of U.S.

Federal business — — ( 1,060.0 )

Consolidated net loss $ ( 427.1 ) $ ( 104.9 ) $ ( 449.8 )

Adjustments to reconcile consolidated net loss to net cash provided by operating activities:

Foreign currency losses 0.2 6.8 2.6

Non-cash interest expense 1.2 1.3 1.8

Debt extinguishment charge — — 28.5

Employee stock compensation 17.2 20.0 18.8

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Other liabilities 15.3 4.7 35.7

Net cash provided by (used for) operating activities 12.7 132.5 ( 681.2 )

Net cash provided by operating activities 74.2 12.7 132.5

Cash flows from investing activities

5 unchanged sentences

Purchases of businesses, net of cash acquired ( 1.2 ) ( 0.3 ) ( 239.3 )

Net proceeds from sale of U.S.

Federal business — — 1,162.9

Other ( 0.9 ) ( 0.9 ) ( 0.9 )

Net cash (used for) provided by investing activities ( 131.4 ) ( 360.3 ) 1,041.6

Net cash used for investing activities ( 69.6 ) ( 131.4 ) ( 360.3 )

Cash flows from financing activities

1 unchanged sentence

Proceeds from issuance of long-term debt — — 1.5

Cash paid for debt extinguishment — — ( 23.7 )

Issuance costs relating to long-term debt — — ( 7.9 )

Proceeds from exercise of stock options — — 4.5

Other ( 0.4 ) ( 3.8 ) ( 8.4 )

Net cash (used for) provided by financing activities ( 21.6 ) ( 105.5 ) 5.1

Net cash used for financing activities ( 17.3 ) ( 21.6 ) ( 105.5 )

Effect of exchange rate changes on cash, cash equivalents and restricted cash 6.7 ( 17.6 ) ( 12.8 )

(Decrease) increase in cash, cash equivalents and restricted cash ( 157.9 ) ( 346.1 ) 354.9

Decrease in cash, cash equivalents and restricted cash ( 6.0 ) ( 157.9 ) ( 346.1 )

Cash, cash equivalents and restricted cash, beginning of year 402.7 560.6 906.7

6 unchanged sentences

Balance at December 31, 2020 $ ( 312.1 ) $ ( 356.8 ) $ 0.7 $ ( 960.5 ) $ ( 114.4 ) $ 4,656.9 $ ( 3,939.5 ) $ 44.7

Consolidated net income 751.2 750.7 750.7 0.5

Consolidated net loss ( 449.8 ) ( 448.5 ) ( 448.5 ) ( 1.3 )

Capped call on conversion of debt — — ( 30.8 ) 30.8

Stock-based activity 16.2 16.2 ( 7.0 ) 23.2

2 unchanged sentences

Balance at December 31, 2021 $ ( 64.4 ) $ ( 113.7 ) $ 0.7 $ ( 1,409.0 ) $ ( 152.2 ) $ 4,710.9 $ ( 3,264.1 ) $ 49.3

Consolidated net loss ( 449.8 ) ( 448.5 ) ( 448.5 ) ( 1.3 )

Capped call on conversion of debt — — ( 30.8 ) 30.8

Consolidated net (loss) income ( 104.9 ) ( 106.0 ) ( 106.0 ) 1.1

Stock-based activity 16.9 16.9 ( 3.8 ) 20.7

15 unchanged sentences

These estimates and assumptions affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities and the reported amounts of revenue and expenses.

Such estimates include the valuation of estimated credit losses, contract assets, operating lease right-of-use assets, outsourcing assets, marketable software, goodwill, purchased intangibles and other long-lived assets, legal contingencies, assumptions used in the calculation for systems integration projects, income taxes, and retirement and other post-employment benefits, among others.

Such estimates include the valuation of estimated credit losses, contract assets, operating lease right-of-use assets, outsourcing assets, marketable software, goodwill, purchased intangibles and other long-lived assets, legal and environmental contingencies, assumptions used in the calculation for systems integration projects, income taxes, and retirement and other post-employment benefits, among others.

These estimates and assumptions are based on management’s best estimates and judgment.

2 unchanged sentences

As future events and their effects cannot be determined with precision, actual results could differ materially from these estimates.

Changes in those estimates resulting from continuing changes in the economic environment such as rising interest rates, inflation, fluctuation in foreign exchange rates, the coronavirus pandemic and the ongoing conflict in Ukraine, will be reflected in the financial statements in future periods.

Changes in those estimates resulting from continuing changes in the economic environment such as rising interest rates, inflation, fluctuation in foreign exchange rates and conflicts and other events of geopolitical significance, will be reflected in the financial statements in future periods.

Cash and Cash equivalents Cash and cash equivalents consist of cash on hand, short-term investments purchased with an original maturity of three months or less and certificates of deposit which may be withdrawn at any time at the discretion of the company without penalty.

52 unchanged sentences

The company’s quantitative assessment in the fourth quarter of 2023 indicated that each reporting unit’s fair value exceeded its carrying value, as such no impairment charge was recognized as of December 31, 2023.

The reporting unit that was closest to impairment was the CA&I reporting unit with fair value in excess of book value, including goodwill, of 6 %.

All other reporting units had a fair value substantially in excess of book value.

All reporting units had a fair value in excess of book value.

Estimating the fair value of reporting units requires the use of estimates and significant judgments that are based on a number of factors including actual operating results.

It is reasonably possible that the judgments and estimates described above could change in future periods.

It is reasonably possible that the judgments and estimates described above could change in future periods, which could have a significant impact on the fair value of the related reporting units.

The company continuously monitors and evaluates relevant events and circumstances that could unfavorably impact the significant assumptions noted above, including changes to U.S.

21 unchanged sentences

The company uses a portfolio of fixed-income securities, which receive at least the second-highest rating given by a recognized ratings agency.

Environmental matters The company is responsible for certain environmental matters including environmental investigations and remedial activities related to various facilities formerly owned or operated by the company or its predecessors.

The company records an estimated environmental liability when it is probable that a liability has been incurred and the amount is reasonably estimable based primarily on the expected costs of pending investigations, current remediation activities, environmental studies and other estimated costs within the identified sites.

The company records a claim for recovery from third parties when its realization is probable.

Both the liability and claim for recovery are recorded on a non-discounted basis.

Provisions for these matters are difficult to estimate due to unknown environmental conditions, including early stages of investigation in some cases, and changes in governmental laws, regulations and in cleanup technologies.

As the company continues to perform investigation activities and if events and circumstances change, the company may incur future additional costs, which could have a material impact on the company’s results of operations, financial condition and cash flows.

Noncontrolling interest The company owns a fifty-one percent interest in Intelligent Processing Solutions Ltd.

1 unchanged sentence

business process outsourcing joint venture.

The remaining interests, which are reflected as a noncontrolling interest in the company’s financial statements, are owned by three financial institutions for which iPSL performs services.

The remaining interests, which are reflected as a noncontrolling interest in the company’s consolidated financial statements, are owned by three financial institutions for which iPSL performs services.

Revenue recognition Revenue is recognized at an amount that reflects the consideration to which the company expects to be entitled in exchange for transferring goods and services to a customer.

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(1) the expected cost plus margin approach, under which the company forecasts its expected costs of satisfying a performance obligation and then adds an appropriate margin for that distinct good or service and (2) the percent discount off of list price approach.

In the Digital Workplace Solutions (DWS) and the Cloud, Applications & Infrastructure Solutions (CA&I) segments, substantially all of the company’s performance obligations are satisfied over time as work progresses and therefore substantially all of the revenue in these segments is recognized over time.

all of the revenue in these segments is recognized over time.

The company generally receives payment for these contracts over time as the performance obligations are satisfied.

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and Level 3 – Unobservable inputs for the asset or liability.

The company has applied fair value measurements to its derivatives (see Note 13, “Financial instruments and concentration of credit risks”), long-term debt (see Note 16, “Debt”), and to its postretirement plan assets (see Note 18, “Employee plans”).

Note 2 — Discontinued operations

On March 13, 2020, the company completed the sale of its U.S.

Federal business to Science Applications International Corporation for cash of $ 1.2 billion.

Net cash proceeds of the sale was $ 1,162.9 million (net of working capital adjustments and transaction costs).

The results of the U.S.

Federal business discontinued operations were as follows:

Year ended December 31, 2020*

Revenue $ 149.5

Operations 8.4

Gain on sale 1,060.7

Income tax provision 0.7

Income from discontinued operations, net of tax $ 1,068.4

* Includes results of operations through the March 13, 2020 closing date.

The company has applied fair value measurements to its derivatives (see

Note 12, “Financial instruments and concentration of credit risks”), long-term debt (see Note 15, “Debt”), and to its postretirement plan assets (see Note 17, “Employee plans”).

Note 2 — Recent accounting pronouncements and accounting changes

Effective January 1, 2022, the company adopted Accounting Standards Update (ASU) No.

2021-08, Accounting for Contract Assets and Contract Liabilities from Contracts with Customers.

This guidance requires that an acquirer recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with ASC 606, Revenue from Contracts with Customers, as if it had originated the contracts.

Deferred revenue acquired in a business combination is no longer required to be measured at its fair value, which had historically resulted in a deferred revenue fair value adjustment at the date of acquisition.

The company will apply this guidance for acquisitions completed on or after January 1, 2022.

In November 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No.

2023-07, Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures , which enhances reportable segment disclosure requirements including disclosures about significant segment expenses on an annual and interim basis.

This update is effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted and requires application on a retrospective basis.

This ASU is not expected to have a material effect on the company’s consolidated financial statements.

In December 2023, the FASB issued ASU No.

2023-09, Income Taxes (Topic 740) - Improvements to Income Tax Disclosures.

This ASU enhances disclosures relating to the rate reconciliation and requires income taxes paid disclosures disaggregated by jurisdiction among other amendments.

This update is effective for annual periods beginning after December 15, 2024, with early adoption permitted and should be applied a prospective basis with a retrospective application permitted.

This ASU is not expected to have a material effect on the company’s consolidated financial statements.

Note 3 — Acquisitions

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The company funded the cash consideration and acquisition-related costs with cash on hand.

The acquisition enhanced the company’s delivery of rapid and agile cloud migration, application modernization and data value realization to our clients.

The fair values of the total net assets acquired was as follows:

Receivables $ 7.8

Prepaid expenses and other current assets 0.7

Properties and other long-term assets 0.2

Operating lease right-of-use assets 0.2

Accounts payable and accruals ( 7.4 )

Long-term operating lease liabilities ( 0.1 )

Intangible assets 45.9

Goodwill 38.0

During 2022, the company finalized its valuation of assets acquired and liabilities assumed resulting in measurement period adjustments that decreased goodwill by $ 27.5 million primarily related to an increase of $ 27.6 million in the fair value of the acquired intangible assets.

The goodwill represents expected synergies, intellectual capital and the acquired assembled workforce, none of which qualify for recognition as a separate intangible asset.

Goodwill determined by the allocation of the purchase price was recorded in the company’s CA&I segment and approximately $ 34 million is deductible for tax purposes.

The following table summarizes the fair value of the intangible assets acquired and the related weighted average amortization period:

Weighted Average Amortization Period in Years Fair Value

Customer relationships 12.0 $ 44.6

Trademark 4.0 1.3

During 2022 and 2021, the company incurred and expensed acquisition-related costs of $ 0.4 million and $ 1.1 million, respectively, included within selling, general and administrative expense in the consolidated statements of income (loss).

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The company funded the cash consideration and acquisition-related costs with cash on hand.

Headquartered in Bellevue, Washington, and with offices in the United Kingdom, Germany, Switzerland, India, Australia and Lithuania, Unify Square is a leading experience management provider for secure collaboration and communication platforms.

The acquisition enhanced the company’s digital workplace solutions and enabled the company to deliver higher value solutions to its clients.

The fair values of the total net assets acquired was as follows:

Receivables $ 3.4

Prepaid expenses and other current assets 0.6

Properties and other long-term assets 0.4

Operating lease right-of-use assets 1.7

Accounts payable and accruals ( 3.8 )

Deferred revenue ( 2.7 )

Long-term operating lease liabilities ( 1.7 )

Intangible assets 19.6

Goodwill 132.9

Total $ 150.4

During 2021, the company finalized its valuation of assets acquired and liabilities assumed resulting in measurement period adjustments that increased goodwill by $ 16.7 million primarily related to a decrease of $ 16.3 million in the fair value of the acquired intangible assets.

The goodwill represents expected synergies, intellectual capital and the acquired assembled workforce, none of which qualify for recognition as a separate intangible asset.

Goodwill determined by the allocation of the purchase price has been recorded in the company’s DWS segment and is not deductible for tax purposes.

The following table summarizes the fair value of the intangible assets acquired and the related weighted average amortization period:

Weighted Average Amortization Period in Years Fair Value

Technology 3.2 $ 10.0

Customer relationships - Software and Software Solutions 3.0 6.6

Customer relationships - Consulting 10.0 3.0

During 2021, the company incurred and expensed acquisition-related costs of $ 2.4 million, included within selling, general and administrative expense in the consolidated statements of income (loss).

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Pro forma information and revenue and operating results of Unify Square have not been presented as the impact is not material to the company’s consolidated financial statements.

On November 18, 2021, the company acquired 100 % of the Mobinergy group of companies (Mobinergy), a leader in unified endpoint management.

The purchase price consideration was not material.

The acquisition enhanced the company’s digital workplace solutions and enabled the company to deliver higher value solutions to its clients.

The company’s consolidated financial statements include the results of Mobinergy commencing as of the acquisition date.

Pro forma information and revenue and operating results of Mobinergy have not been presented as the impact is not material to the company’s consolidated financial statements.

Note 4 — Cost-reduction actions

The company from time to time initiates cost reduction actions designed to improve operating efficiency, reduce costs and align the company’s workforce and facility structures to its overall business plan.

During 2023, the company recognized cost-reduction charges and other costs of $ 9.3 million.

The net charges related to work-force reductions were $ 7.5 million, principally related to severance costs, and were comprised of:

The net charges related to workforce reductions were $ 8.3 million, principally related to severance costs, and were comprised of:

(a) a charge of $ 15.2 million and (b) a credit of $ 6.9 million for changes in estimates.

In addition, the company recorded net charges of $ 1.0 million comprised of charges of $ 4.7 million primarily related to professional fees and other expenses related to cost-reduction efforts and a credit of $ 3.7 million for net foreign currency gains related to exiting foreign countries.

During 2022, the company recognized cost-reduction charges and other costs of $ 54.9 million.

The net charges related to workforce reductions were $ 7.5 million, principally related to severance costs, and were comprised of:

(a) a charge of $ 7.1 million and (b) a charge of $ 0.4 million for changes in estimates.

In addition, the company recorded net charges of $ 47.4 million comprised of charges of $ 13.6 million related to held-for-sale assets (see Note 14, “Properties” for further details), $ 10.9 million for asset impairments, $ 11.3 million for idle leased facilities costs, $ 9.3 million for contract exit costs, $ 2.9 million for net foreign currency losses related to exiting foreign countries and a credit of $ 0.6 million for changes in estimates related to other cost-reduction efforts.

In addition, the company recorded charges of

$ 47.4 million comprised of charges of $ 13.6 million related to held-for-sale assets (see Note 13, “Properties” for further details), $ 10.9 million for asset impairments, $ 11.3 million for idle leased facilities costs, $ 9.3 million for contract exit costs, $ 2.9 million for net foreign currency losses related to exiting foreign countries and a credit of $ 0.6 million for changes in estimates related to other cost-reduction efforts.

During 2021, the company recognized cost-reduction charges and other costs of $ 23.2 million.

The net charges related to work-force reductions were $ 0.4 million, principally related to severance costs, and were comprised of:

The net charges related to workforce reductions were $ 0.4 million, principally related to severance costs, and were comprised of:

(a) a charge of $ 12.3 million and (b) a credit of $ 11.9 million for changes in estimates.

In addition, the company recorded charges of $ 22.8 million comprised of $ 12.6 million for asset impairments, $ 6.2 million for other expenses related to cost-reduction efforts and $ 4.0 million for net foreign currency losses related to exiting foreign countries.

During 2020, the company recognized cost-reduction charges and other costs of $ 95.5 million.

The net charges related to work-force reductions were $ 25.5 million, principally related to severance costs, and were comprised of:

(a) a charge of $ 39.0 million and (b) a credit of $ 13.5 million for changes in estimates.

In addition, the company recorded charges of $ 70.0 million comprised of $ 32.3 million for net foreign currency losses related to exiting foreign countries, $ 24.0 million for asset impairments and $ 13.7 million for other expenses related to cost-reduction efforts.

The charges (credits) were recorded in the following statement of income (loss) classifications:

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Total $ 9.3 $ 54.9 $ 23.2

Liabilities and expected future payments related to the company’s work-force reduction actions are as follows:

Liabilities and expected future payments related to the company’s workforce reduction actions are as follows:

International

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2024 $ 0.3 $ 22.7

2024 0.4 19.7

Thereafter — 4.2

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Foreign exchange losses** ( 0.2 ) ( 6.8 ) ( 2.5 )

Debt extinguishment charge — — ( 28.5 )

Environmental costs and other, net*** ( 6.6 ) ( 32.4 ) ( 29.2 )

Total other (expense), net $ ( 393.9 ) $ ( 82.4 ) $ ( 580.3 )

*Includes $ 499.4 million of settlement losses in 2021 related to the company’s defined benefit pension plans and $ 142.1 million settlement loss in 2020 related to the U.S.

defined benefit pension plans.

*Includes $ 348.9 million of settlement losses in 2023 and $ 499.4 million of settlement losses in 2021 related to the company’s defined benefit pension plans.

See Note 17, “Employee plans.”

**Includes charges of $ 2.9 million, $ 4.0 million and $ 32.3 million respectively, in 2022, 2021 and 2020 for net foreign currency losses related to substantial completion of liquidation of foreign subsidiaries.

***Environmental costs relates to a previously disposed business.

**Includes (credits) charges of $( 3.7 ) million, $ 2.9 million and $ 4.0 million respectively, in 2023, 2022 and 2021 for net foreign currency (gains) losses related to substantial completion of liquidation of foreign subsidiaries.

***Environmental costs relate to previously disposed businesses.

Note 7 — Income taxes

Following is the total loss from continuing operations before income taxes and the provision (benefit) for income taxes.

Following is the total loss before income taxes and the provision (benefit) for income taxes.

Year ended December 31, 2023 2022 2021

Income (loss) from continuing operations before income taxes

Income (loss) before income taxes

United States $ ( 545.5 ) $ ( 177.2 ) $ ( 443.5 )

Foreign 197.7 114.6 ( 18.2 )

Total loss from continuing operations before income taxes $ ( 62.6 ) $ ( 461.7 ) $ ( 271.8 )

Total loss before income taxes $ ( 347.8 ) $ ( 62.6 ) $ ( 461.7 )

Provision (benefit) for income taxes

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Permanent items ( 3.0 ) ( 2.1 ) ( 1.8 )

Enacted rate changes — ( 17.1 ) ( 4.0 )

Change in uncertain tax positions 3.8 0.4 ( 0.3 )

Change in valuation allowances 2.1 ( 9.8 ) ( 0.8 )

Income tax credits, U.S.

income tax benefit

Other 0.1 — —

Enacted rate changes — — ( 17.1 )

Provision (benefit) for income taxes $ 79.3 $ 42.3 $ ( 11.9 )

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Valuation allowance, at end of year $ ( 1,150.1 ) $ ( 1,110.5 ) $ ( 1,226.2 )

(i) Includes U.S pension activity of $( 11.3 ) million, $( 84.9 ) million and $ 141.7 million for the years ended December 31, 2022, 2021 and 2020, respectively.

At December 31, 2022, the company has tax effected tax loss carryforwards as follows:

(i) Includes U.S.

pension activity of $( 95.9 ) million, ($ 11.3 ) million and ($ 84.9 ) million for the years ended December 31, 2023, 2022 and 2021, respectively.

The company has tax effected tax loss carryforwards as follows:

As of December 31, 2023

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Any increase or decrease in the valuation allowance would result in additional or lower income tax expense in that period and could have a significant impact on that period’s earnings.

As a result of its projections of future taxable income during 2022, the company has determined that a portion of its non-U.S.

net deferred tax assets no longer requires a valuation allowance.

During 2023, the company determined that a portion of its non-U.S.

net deferred tax assets required an additional valuation allowance.

The net change in the valuation allowance impacting the effective tax rate in 2023 was approximately $ 2.1 million, primarily in Latin America.

During 2022, the company determined that a portion of its non-U.S.

net deferred tax assets no longer required a valuation allowance.

The net change in the valuation allowances impacting the effective tax rate in 2022 was approximately $ 9.8 million of a tax benefit, primarily in the United Kingdom and other foreign jurisdictions.

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federal jurisdiction, and various states and foreign jurisdictions.

state and foreign income tax audits are in process.

The company is under an audit in India, for which years prior to 2007 are closed.

For the most significant jurisdictions outside the U.S., the audit periods through 2017 are closed for Brazil, and the audit periods through 2018 are closed for the United Kingdom.

All of the various ongoing income tax audits throughout the world are not expected to have a material impact on the company’s financial position.

The company is currently undergoing audits in several of its foreign jurisdictions.

Ongoing income tax audits throughout the world are not expected to have a material impact on the company’s financial position.

Internal Revenue Code Sections 382 and 383 provide annual limitations with respect to the ability of a corporation to utilize its net operating loss (as well as certain built-in losses) and tax credit carryforwards, respectively (Tax Attributes), against future U.S.

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The company regularly monitors ownership changes (as calculated for purposes of Section 382).

The company has determined that, for purposes of the rules of Section 382 described above, an ownership change occurred in February 2011.

The company has determined that, for purposes of the rules of Section 382 described above, an ownership change occurred in 2011.

Any future transaction or transactions and the timing of such transaction or transactions could trigger additional ownership changes under Section 382.

As a result of the February 2011 ownership change, utilization for certain of the company’s Tax Attributes, U.S.

As a result of the ownership change in 2011, utilization for certain of the company’s Tax Attributes, U.S.

net operating losses and tax credits, is subject to an overall annual limitation of $ 70.6 million.

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Based on presently available information and the existence of tax planning strategies, the company does not expect to incur a U.S.

cash tax liability in the near term.

federal cash tax liability in the near term.

Note 8 — Earnings (loss) per common share

The following table shows how earnings (loss) per common share attributable to Unisys Corporation was computed for the three years ended December 31, 2022 (shares in thousands).

The following table shows how loss per common share attributable to Unisys Corporation was computed for the three years ended December 31, 2023 (shares in thousands).

Year ended December 31, 2023 2022 2021

Basic earnings (loss) per common share computation:

Net loss from continuing operations attributable to Unisys Corporation $ ( 106.0 ) $ ( 448.5 ) $ ( 317.7 )

Income from discontinued operations, net of tax — — 1,068.4

Net (loss) income attributable to Unisys Corporation $ ( 106.0 ) $ ( 448.5 ) $ 750.7

Basic loss per common share computation:

Net loss attributable to Unisys Corporation $ ( 430.7 ) $ ( 106.0 ) $ ( 448.5 )

Weighted average shares 68,254 67,665 66,451

Basic earnings (loss) per share attributable to Unisys Corporation

Continuing operations $ ( 1.57 ) $ ( 6.75 ) $ ( 5.05 )

Discontinued operations — — 16.98

Total $ ( 1.57 ) $ ( 6.75 ) $ 11.93

Diluted earnings (loss) per common share computation:

Net loss from continuing operations attributable to Unisys Corporation $ ( 106.0 ) $ ( 448.5 ) $ ( 317.7 )

Add interest expense on convertible senior notes, net of tax of zero

Net loss from continuing operations attributable to Unisys Corporation for diluted earnings per share ( 106.0 ) ( 448.5 ) ( 317.7 )

Income from discontinued operations, net of tax — — 1,068.4

Net (loss) income attributable to Unisys Corporation for diluted earnings per share $ ( 106.0 ) $ ( 448.5 ) $ 750.7

Basic loss per common share $ ( 6.31 ) $ ( 1.57 ) $ ( 6.75 )

Diluted loss per common share computation:

Net loss attributable to Unisys Corporation $ ( 430.7 ) $ ( 106.0 ) $ ( 448.5 )

Weighted average shares 68,254 67,665 66,451

Plus incremental shares from assumed conversions:

Employee stock plans — — —

Convertible senior notes — — —

Plus incremental shares from assumed conversions of employee stock plans

Adjusted weighted average shares 68,254 67,665 66,451

Diluted earnings (loss) per common share attributable to Unisys Corporation

Continuing operations $ ( 1.57 ) $ ( 6.75 ) $ ( 5.05 )

Discontinued operations — — 16.98

Total $ ( 1.57 ) $ ( 6.75 ) $ 11.93

Anti-dilutive weighted-average stock options and restricted stock units (i)

Diluted loss per common share $ ( 6.31 ) $ ( 1.57 ) $ ( 6.75 )

Anti-dilutive weighted-average restricted stock units (i)

Anti-dilutive weighted-average common shares issuable upon conversion of the 5.50 % convertible senior notes (i) (see Note 15, “Debt”)

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Estimates of expected credit losses are based primarily on the aging of the accounts receivable balances.

The company records a specific reserve for individual accounts when it becomes aware of a customer’s inability to meet its financial obligations, such as in the case of

bankruptcy filings or deterioration in the customer’s operating results or financial position.

The company records a specific reserve for individual accounts when it becomes aware of a customer’s inability to meet its financial obligations, such as in the case of bankruptcy filings or deterioration in the customer’s operating results or financial position.

The collection policies and procedures of the company vary by credit class and prior payment history of customers.

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Contract assets - current

$ 11.7 $ 28.9

Contract assets - long-term (i)

Deferred revenue - current

( 198.6 ) ( 200.7 )

Deferred revenue - long-term

( 104.4 ) ( 122.3 )

(i) Reported in other long-term assets on the company’s consolidated balance sheets.

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These costs are classified as current or noncurrent based on the timing of when the company expects to recognize the expense.

The current and noncurrent portions of deferred commissions are included in prepaid expenses and other current assets and in other long-term assets, respectively, in the company’s consolidated balance sheets.

The current and noncurrent portions of deferred commissions are included in prepaid expenses, other current assets and in other long-term assets, respectively, in the company’s consolidated balance sheets.

Deferred commissions were as follows:

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The company measures assets held-for-sale at the lower of their carrying amount or fair value less cost to sell.

Additionally, the company determined that such assets comprise operations and cash flows that can be clearly distinguished, operationally and for financial reporting purposes, from the rest of the company.

In 2021, as part of continued cost reduction initiatives, the company decided to exit a data center facility located in Eagan, Minnesota and move the activities to lower cost centers.

As a result, the company entered into a letter of intent (LOI) in September 2021 with a third party for the sale of land and building at this location.

Upon the execution of the LOI, these assets were classified as held-for-sale in the company’s consolidated balance sheet.

As the sale was not consummated and the assets have been held-for-sale for more than a year, the company evaluated whether (i) the company has taken all necessary actions to respond to the change in circumstances;

In 2021, the company determined that its data center facility located in Eagan, Minnesota, met the criteria for classification of the related assets as held-for-sale.

Since the assets have been held-for-sale for more than a year, the company evaluates whether (i) the company has taken all necessary actions to respond to the change in circumstances;

(ii) the company is actively marketing the data center facility at a price that is reasonable;

and (iii) the company continues to meet all of the criteria to continue to classify the assets as held-for-sale.

During 2022, the company recognized an asset held-for-sale write-down of $ 13.6 million, reducing the assets to its estimated current fair market value less costs to sell.

The valuation report was considered a Level 2 input.

The company is actively marketing this facility for sale and continues to identify interested parties.

Additionally, during the fourth quarter of 2022, the company obtained an updated valuation report and recognized an asset held-for-sale write-down of $ 13.6 million, reducing the assets to its estimated current fair market value less costs to sell.

The valuation report is considered a Level 2 input.

The company believes the classification continues to be appropriate and that all the criteria has been met to classify these assets as held-for-sale at December 31, 2023.

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Balance at December 31, 2021 $ 315.0 $ 140.9 $ 65.5 $ 98.3 $ 10.3

Acquisitions (i)

Acquisition - Measurement period adjustments (i)

( 27.5 ) — ( 27.5 ) — —

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Balance at December 31, 2022 287.1 140.5 38.0 98.3 10.3

Acquisition - Measurement period adjustments (ii)

( 27.5 ) — ( 27.5 ) — —

Translation adjustments 0.3 0.3 — — —

Balance at December 31, 2023 $ 287.4 $ 140.8 $ 38.0 $ 98.3 $ 10.3

(i) During 2021, the company acquired Unify Square and Mobinergy resulting in goodwill of $ 132.9 million and $ 7.9 million, respectively, recorded in the company’s DWS segment and CompuGain resulting in goodwill of $ 65.5 million recorded in the company’s CA&I segment.

See Note 4, “Acquisitions.”

(ii) During 2022, the company finalized its valuation of assets and liabilities assumed in the CompuGain acquisition resulting in measurement period adjustments that decreased goodwill by $ 27.5 million.

See Note 4, “Acquisitions.”

(i) Includes a measurement period adjustment that decreased goodwill by $ 27.5 million related to a prior period acquisition.

At December 31, 2023, the amount of goodwill allocated to reporting units with negative net assets within Other was $ 10.3 million.

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$ 10.0 $ 8.1 $ 1.9

Customer relationships (ii) (iii)

Customer relationships (ii)

54.2 14.1 40.1

Marketing (iii)

Marketing (ii)

Total $ 65.5 $ 22.8 $ 42.7

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Gross Carrying Amount Accumulated Amortization Net Carrying Amount

Technology (iii)

Technology (i)

$ 10.0 $ 4.9 $ 5.1

Customer relationships (iii)

Customer relationships (ii)(iii)

54.2 7.9 46.3

Marketing (iii)

Marketing (ii)

Total $ 65.5 $ 13.1 $ 52.4

(i) Amortization expense is included within cost of revenue - technology in the consolidated statements of income (loss).

(ii) During 2022, the company finalized its valuation of assets and liabilities assumed in the CompuGain acquisition resulting in measurement period adjustments that increased the fair value of the acquired intangible assets by $ 27.6 million.

See Note 4, “Acquisitions.”

(iii) Amortization expense is included within selling, general and administrative expense in the consolidated statements of income (loss).

Amortization expense was $ 10.1 million and $ 3.0 million for the year ended December 31, 2022 and 2021, respectively.

(ii) Amortization expense is included within selling, general and administrative expense in the consolidated statements of income (loss).

(iii) Customer relationships include a measurement period adjustment that increased the fair value of the acquired intangible assets by $ 27.6 million related to a prior period acquisition.

Amortization expense was $ 9.7 million, $ 10.1 million and $ 3.0 million for the years ended December 31, 2023, 2022 and 2021, respectively.

The future amortization relating to acquired intangible assets at December 31, 2023 was estimated as follows:

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The company and certain international subsidiaries have access to uncommitted lines of credit from various banks.

At December 31, 2022, the company has met all covenants and conditions under its various lending agreements.

At December 31, 2023, the company had met all covenants and conditions under its various lending agreements.

The company expects to continue to meet these covenants and conditions through at least the next twelve months.

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2027 481.3 481.3 —

2027 480.1 480.1 —

Total $ 504.2 $ 503.9 $ 0.3

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Senior Secured Notes due 2027

The company has $ 485.0 million aggregate principal amount of its 6.875 % Senior Secured Notes due 2027 (the 2027 Notes).

The company has outstanding $ 485.0 million aggregate principal amount of its 6.875 % Senior Secured Notes due 2027 (the 2027 Notes).

The 2027 Notes pay interest semiannually on May 1 and November 1 and will mature on November 1, 2027, unless earlier repurchased or redeemed.

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The liens securing the 2027 Notes on certain ABL collateral are subordinated to the liens on ABL collateral in favor of the ABL secured parties and, in the future, the liens securing the 2027 Notes may be subordinated to liens on the collateral securing certain permitted first lien debt, subject to certain limitations and permitted liens.

Prior to November 1, 2023 the company may, at its option, redeem some or all of the 2027 Notes at any time, at a price equal to 100 % of the principal amount of the 2027 Notes redeemed plus a “make-whole” premium, plus accrued and unpaid interest, if any.

The company may also redeem, at its option, up to 40 % of the 2027 Notes at any time prior to November 1, 2023, using the proceeds of certain equity offerings at a redemption price of 106.875 % of the principal amount thereof, plus accrued and unpaid interest, if any.

On or after November 1, 2023, the company may, on any one or more occasions, redeem all or a part of the 2027 Notes at specified redemption premiums, declining to par for any redemptions on or after November 1, 2025.

The company may, on any one or more occasions, redeem all or a part of the 2027 Notes at specified redemption premiums, declining to par for any redemptions on or after November 1, 2025.

The indenture contains covenants that limit the ability of the company and its restricted subsidiaries to, among other things:

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(iii) prepay, redeem or repurchase certain debt;

(iv) make certain prepayments in respect of pension obligations;

(v) issue certain preferred stock or similar equity securities;

(vi) make loans and investments (including investments by the company and subsidiary guarantors in subsidiaries that are not guarantors);

(vii) sell assets;

(viii) create or incur liens;

(ix) enter into transactions with affiliates;

(x) enter into agreements restricting its subsidiaries’ ability to pay dividends;

and (xi) consolidate, merge or sell all or substantially all of its assets.

(iv) issue certain preferred stock or similar equity securities;

(v) make loans and investments;

(vi) sell assets;

(vii) create or incur liens;

(viii) enter into transactions with affiliates;

(ix) enter into agreements restricting its subsidiaries’ ability to pay dividends;

and (x) consolidate, merge or sell all or substantially all of its assets.

These covenants are subject to several important limitations and exceptions.

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Total $ 34.5 $ 34.5 $ 34.5

Senior Secured Notes due 2022

In April 2020, the company redeemed all $ 440.0 million in aggregate principal amount of its outstanding 10.750 % Senior Secured Notes due 2022 (the 2022 Notes) for a redemption price equal to 105.375 % of the aggregate principal amount of the 2022 Notes redeemed plus accrued but unpaid interest to, but not including, the redemption date.

The redemption price paid was $ 487.3 million and is made up of the following:

$ 440.0 million of principal amount due, $ 23.65 million of call premium and $ 23.65 million of accrued interest through April 14, 2020.

In 2020, the company recorded a loss on debt extinguishment in other expense, net of $ 28.5 million consisting of the premium of $ 23.65 million and write off of $ 4.8 million of unamortized discount and fees related to the issuance of the 2022 Notes.

Interest expense related to the 2022 Notes was as follows:

Year ended December 31, 2020

Contractual interest coupon $ 13.8

Amortization of issuance costs 0.7

Convertible Senior Notes Due 2021

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The issuance of the common stock was made in exchange for the 2021 Notes pursuant to an exemption from the registration requirements provided by Section 3(a)(9) of the Securities Act of 1933, as amended.

The company also received 1,251,460 shares of its common stock, held in treasury stock, from the settlement of the capped call transactions that the company had entered into with the initial purchasers and/or affiliates of the initial purchasers of the 2021 Notes in connection with the issuance of the 2021 Notes.

As a result, the net number of outstanding shares of the company’s common stock following the conversion of the 2021 Notes increased by 3,285,663 shares.

Interest expense related to the 2021 Notes was as follows:

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Amortization of debt issuance costs 0.1

Total $ 1.4 $ 8.2

The company has a $ 27.7 million Installment Payment Agreement (IPA) maturing on December 20, 2023 with a syndicate of financial institutions to finance the acquisition of certain software licenses necessary for the provision of services to a client.

Interest accrues at an annual rate of 7.0 % and the company is required to make monthly principal and interest payments on each agreement in arrears.

At December 31, 2022 and 2021, $ 5.5 million and $ 5.5 million, was reported in current maturities of long-term debt, respectively.

The company has a vendor agreement in the amount of $ 19.3 million to finance the acquisition of certain software licenses used to provide services to our clients and for its own internal use.

Interest accrues at an annual rate of 5.47 % and the company is

required to make annual principal and interest payments in advance with the last payment due on March 1, 2024.

At December 31, 2022 and 2021, $ 4.0 million and $ 3.8 million was reported in current maturities of long-term debt, respectively.

Asset Based Lending (ABL) Credit Facility

The company has a secured revolving credit facility (the Amended and Restated ABL Credit Facility) that matures on October 29, 2025 and provides for revolving loans and letters of credit up to an aggregate amount of $ 145.0 million (with a limit on letters of credit of $ 40.0 million), with an accordion feature provision allowing for the aggregate amount available under the credit facility to be increased up to $ 175.0 million upon the satisfaction of certain conditions specified in the Amended and Restated ABL Credit Facility.

The company has a secured revolving credit facility (the Amended and Restated ABL Credit Facility), which matures on October 29, 2025, and provides for revolving loans and letters of credit up to an aggregate amount of $ 145.0 million (with a limit on letters of credit of $ 40.0 million), with an accordion feature provision allowing for the aggregate amount available under the credit facility to be increased up to $ 175.0 million upon the satisfaction of certain specified conditions.

The Amended and Restated ABL Credit Facility was amended on June 2, 2023, primarily to replace the reference rate from the London Interbank Offered Rate to the Secured Overnight Financing Rate.

Availability under the credit facility is subject to a borrowing base calculated by reference to the company’s receivables.

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The Amended and Restated ABL Credit Facility is guaranteed by the subsidiary guarantors and any future material domestic subsidiaries.

The facility is secured by the assets of the company and the subsidiary guarantors, other than certain excluded assets, under a security agreement entered into by the company and the subsidiary guarantors in favor of JPMorgan Chase Bank, N.A., as agent for the lenders under the credit facility.

The facility is secured by the assets of the company and the subsidiary guarantors, other than certain excluded

assets, under a security agreement entered into by the company and the subsidiary guarantors in favor of JPMorgan Chase Bank, N.A., as agent for the lenders under the credit facility.

The company is required to maintain a minimum fixed charge coverage ratio if the availability under the Amended and Restated ABL Credit Facility falls below the greater of 10 % of the lenders’ commitments under the facility and $ 14.5 million.

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Income taxes 31.4 41.3

Operating leases 26.0 35.4

Taxes other than income taxes 27.4 23.2

Accrued vacations 22.4 21.1

Cost reduction 11.7 14.9

Operating leases 19.1 26.0

Postretirement 10.2 11.7

Cost reduction 9.4 11.7

Accrued interest 5.8 5.9

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Management develops the actuarial assumptions used by its U.S.

and international defined benefit pension plan obligations based upon the circumstances of each particular plan.

and international

defined benefit pension plan obligations based upon the circumstances of each particular plan.

The determination of the defined benefit pension plan obligations requires the use of estimates.

The American Rescue Plan Act, which was signed into law in the U.S.

on March 11, 2021, includes a provision for pension relief that extends the amortization period for required contributions from 7 to 15 years and provides for the stabilization of interest rates used to calculate future required contributions.

in 2021, includes a provision for pension relief that extends the amortization period for required contributions from 7 to 15 years and provides for the stabilization of interest rates used to calculate future required contributions.

As a result, the company was not required to make cash contributions to its U.S.

qualified defined benefit pension plans in 2023, 2022 and 2021.

In March 2023, the company purchased a group annuity contract, with plan assets, for approximately $ 263 million to transfer projected benefit obligations related to approximately 8,650 retirees of one of the company’s U.S.

defined benefit pension plans.

This action resulted in a pre-tax settlement loss of $ 181.0 million for the year ended December 31, 2023.

In November 2023, the company purchased a group annuity contract, with plan assets, for approximately $ 253 million to transfer projected benefit obligations related to approximately 3,900 retirees of one of the company’s U.S.

defined benefit pension plans.

This action resulted in a pre-tax settlement loss of $ 167.2 million for the year ended December 31, 2023.

In January of 2021, the company purchased a group annuity contract for $ 279 million to transfer projected benefit obligations related to approximately 11,600 retirees of the company’s U.S.

defined benefit pension plans.

This action resulted in a pre-tax settlement loss of $ 158.0 million.

This action resulted in a pre-tax settlement loss of $ 158.0 million for the year ended December 31, 2021.

Effective May 1, 2021, the company’s primary pension plan related to its Dutch subsidiary was transferred to a multi-client circle within a multi-employer fund.

This resulted in removing all of the plan’s projected benefit obligations, valued at approximately $ 553 million, from the company’s balance sheet.

This action resulted in a pre-tax settlement loss of $ 182.5 million.

This action resulted in a pre-tax settlement loss of $ 182.5 million for the year ended December 31, 2021.

In the second quarter of 2021, the company’s Swiss subsidiary transferred its defined benefit pension plan to a multiple-employer collective foundation.

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The transfer required a one-time additional contribution of approximately $ 10 million to the Swiss plan in 2021.

This action resulted in a pre-tax settlement loss of $ 28.8 million.

This action resulted in a pre-tax settlement loss of $ 28.8 million for the year ended December 31, 2021.

On October 14, 2021, the company purchased a group annuity contract for approximately $ 235 million to transfer projected benefit obligations related to approximately 6,900 retirees of the company’s U.S.

defined benefit pension plans.

This action resulted in a pre-tax settlement loss of $ 130.1 million.

In December 2020, the company completed a lump-sum cash-out offer for eligible former associates who had deferred vested benefit under the company’s U.S.

defined benefit pension plans to receive the value of their entire pension benefit in a lump-sum payment.

As a result, the pension plan trust made lump sum payments to approximately 3,500 former associates of $ 276.0 million and the company recorded a non-cash pre-tax settlement charge of $ 142.1 million.

This action resulted in a pre-tax settlement loss of $ 130.1 million for the year ended December 31, 2021.

Retirement plans’ funded status and amounts recognized in the company’s consolidated balance sheets follows:

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Recognized net actuarial loss 75.6 125.9 135.6 9.1 37.7 48.3

Settlement loss — 288.1 142.1 — 211.3 —

Settlement losses

348.2 — 288.1 0.7 — 211.3

Net periodic pension expense (income) $ 395.4 $ 48.2 $ 339.0 $ ( 4.1 ) $ ( 1.1 ) $ 214.9

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pension plans, is the discount rate.

Weighted-average assumptions used to determine net periodic pension expense were as follows:

Weighted-average assumptions used to determine net periodic pension expense (income) were as follows:

Plans International Plans

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Also, since the company’s investment policy is to actively manage certain asset classes where the potential exists to outperform the broader market, the expected returns for those asset classes were adjusted to reflect the expected additional returns.

In 2023, the company expects to make cash contributions of $ 40 million, primarily for international defined benefit pension plans.

In 2024, the company expects to make cash contributions of approximately $ 21 million, primarily for international defined benefit pension plans.

As of December 31, 2023, the following benefit payments are expected to be paid from the defined benefit pension plans:

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2028 213.8 102.1

2028 - 2032 1,190.7 501.2

Other postretirement benefits A reconciliation of the benefit obligation, fair value of the plan assets and the funded status of the postretirement benefit plans follows:

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Plan participants’ contributions 0.3 0.9

Amendments — 1.2

Actuarial (gain) loss ( 16.1 ) 1.8

Actuarial gain ( 6.9 ) ( 16.1 )

Benefits paid ( 5.1 ) ( 4.9 )

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Total funded status $ ( 56.9 ) $ ( 63.7 )

Accumulated other comprehensive loss, net of tax

Net (income) loss $ ( 7.8 ) $ 1.4

Prior service credit ( 0.7 ) ( 2.1 )

Accumulated other comprehensive income, net of tax

$ ( 7.6 ) $ ( 7.8 )

Prior service cost (credit)

Net periodic postretirement benefit (income) cost follows:

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Expected return on assets ( 0.3 ) ( 0.3 ) ( 0.3 )

Amortization of prior service cost ( 1.4 ) ( 1.7 ) ( 1.6 )

Recognized net actuarial (gain) loss ( 2.2 ) ( 2.1 ) 1.0

Net periodic benefit (income) cost $ ( 1.8 ) $ ( 1.9 ) $ 3.9

Amortization of prior service credit ( 1.3 ) ( 1.4 ) ( 1.7 )

Recognized net actuarial gain ( 4.0 ) ( 2.2 ) ( 2.1 )

Net periodic benefit income $ ( 2.8 ) $ ( 1.8 ) $ ( 1.9 )

(i) Service cost is reported in selling, general and administrative expenses.

All other components of net periodic benefit (income) cost are reported in other (expense), net in the consolidated statements of income (loss).

Weighted-average assumptions used to determine net periodic postretirement benefit (income) cost were as follows:

Weighted-average assumptions used to determine net periodic postretirement benefit (income) were as follows:

Year ended December 31, 2023 2022 2021

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Year Expected

2028 – 2032 20.1

The following provides a description of the valuation methodologies and the levels of inputs used to measure fair value, and the general classification of investments in the company’s U.S.

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Commingled Funds

Equity $ — $ 404.5

Debt $ 65.0 $ 788.8

Other 147.4 244.4

Private Real Estate 238.9

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The fair value amounts presented in this table for these investments are included to permit reconciliation of the fair value hierarchy to the total plan assets.

The following table sets forth a summary of changes in the fair value of the plans’ Level 3 assets for the year ended December 31, 2022.

The following tables set forth a summary of changes in the fair value of the plans’ Level 3 assets for the years ended December 31, 2023 and 2022.

(losses) Purchases

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Insurance Contracts $ 100.3 $ — $ 375.6 $ ( 13.8 ) $ 48.5 $ 510.6

The following table sets forth a summary of changes in the fair value of the plans’ Level 3 assets for the year ended December 31, 2021.

(losses) Purchases

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Commingled Funds

Debt $ 65.0 $ — Monthly 45 days $ 78.6 $ — Monthly 45 days

Other 147.4 — Monthly, Quarterly 5 - 90 days

Debt $ 102.3 $ — Daily, Monthly 15 - 45 days

$ 65.0 $ — Monthly 45 days

Other 96.8 — Monthly, Quarterly 5 - 90 days

147.4 — Monthly, Quarterly 5 - 90 days

Private Real Estate (i)

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Commingled Funds

Equity $ — $ — $ 404.5 $ — Weekly Up to 2 days

Debt 788.8 73.7 Weekly, Monthly, Quarterly Up to 120 days

1,077.3 138.9 Weekly, Bimonthly, Monthly, Quarterly Up to 120 days

Other 244.4 — Bimonthly 10 days

Debt $ 191.4 $ 42.1 Never $ 788.8 $ 73.7 Weekly, Monthly, Quarterly Up to 120 days

Other 348.1 — Bimonthly 10 days 244.4 — Bimonthly 10 days

Total $ 539.5 $ 42.1 $ 1,033.2 $ 73.7

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real estate and allow redemptions quarterly, though queues, restrictions and gates may extend the period.

A redemption has been requested from three funds, which have a redemption queue with estimates of full receipt of three to four years .

A redemption has been requested from three funds, which have a redemption queue with estimates of full receipt of three to five years .

(ii) Includes investments in limited partnerships, which invest primarily in secondary markets and private credit.

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These matters can involve a number of different parties, including competitors, clients, current or former employees, government and regulatory agencies, stockholders and representatives of the locations in which the company does business.

Many of these matters are also highly complex and may seek recovery on behalf of a class or similarly large number of plaintiffs.

It is therefore inherently difficult to predict the size or scope of potential future losses arising from these matters.

The company records a provision for these matters when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated.

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These adjustments could have a material impact on our results of operations and financial position.

The company intends to defend itself vigorously with respect to legal matters pending against it.

Based on its experience, the company also believes that the damage amounts claimed in the matters disclosed below are not a meaningful indicator of the company’s potential liability.

Litigation is inherently unpredictable and unfavorable resolutions could occur.

The company intends to defend itself vigorously with respect to any legal matters.

Based on its experience, the company also believes that the damage amounts claimed against it in the matters disclosed below are not a meaningful indicator of the company’s potential liability.

Legal proceedings are inherently unpredictable and unfavorable resolutions have and could occur.

Whether any losses, damages or remedies finally determined in any claim, suit, investigation or proceeding could reasonably have a material effect on the company’s business, financial condition, results of operations or cash flows will depend on a number of variables, including:

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the significance of the impact any such losses, damages or remedies may have in the company’s consolidated financial statements;

and the unique facts and circumstances of the

particular matter that may give rise to additional factors.

and the unique facts and circumstances of the particular matter that may give rise to additional factors.

Accordingly, it is possible that an adverse outcome from such matters could be material to the company’s financial condition, results of operations and cash flows in any particular reporting period.

Notwithstanding that the ultimate results of the lawsuits, claims, investigations and proceedings that have been brought or asserted against the company are not currently determinable, the company believes that at December 31, 2023, it has adequate provisions for any such matters.

The following is a summary of the more significant legal matters involving the company.

The following is a summary of the more significant legal proceedings involving the company.

The company’s Brazilian operations, along with those of many other companies doing business in Brazil, are involved in various litigation matters, including numerous governmental assessments related to indirect and other taxes, as well as disputes associated with former employees and contract labor.

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The company believes that appropriate accruals have been established for such matters based on information currently available.

At December 31, 2022, excluding those matters that have been assessed by management as being remote as to the likelihood of ultimately resulting in a loss, the amount related to unreserved tax-related matters, inclusive of any related interest, is estimated to be up to approximately $ 109 million.

On November 11, 2022, a purported stockholder of the company filed a putative securities class action complaint in the United States District Court for the Eastern District of Pennsylvania against the company and certain of its current officers, alleging violations of the Securities Exchange Act of 1934, as amended, based on allegedly false or misleading statements related to projections and certain other statements positively characterizing the company’s momentum, business, prospects and operations, and the effectiveness of the company’s internal control over financial reporting and the company’s disclosure controls and procedures.

At December 31, 2023, excluding those matters that have been assessed by management as being remote as to the likelihood of ultimately resulting in a loss, the amount related to unreserved tax-related matters, inclusive of any related interest, is estimated to be approximately $ 119 million.

From time to time, the company is involved in legal proceedings with its clients concerning products and services that the company has provided.

On January 31, 2024, in response to a claim brought by a former client for approximately $ 28 million including interest, a court in The Hague, Netherlands issued a judgment against Unisys Netherlands, N.V.

in the amount of approximately $ 8 million including interests and compensation for legal fees.

The parties have until April 30, 2024 to appeal the judgment.

The company believes it has an adequate provision for this matter.

The plaintiff seeks an award of compensatory damages, among other relief, and costs and attorneys’ and experts’ fees.

On August 21, 2023, the class action complaint was amended to assert violations of the Exchange Act, based on allegedly false or misleading statements related to the efficacy of the company’s disclosure controls and procedures, and internal control over financial reporting in certain of the company’s 2021 and 2022 filings with the SEC.

On October 20, 2023, the company filed a motion to dismiss the amended

complaint for plaintiff’s failure to state a claim on which relief may be granted.

On February 1, 2024, the Court entered an order dismissing plaintiff’s amended complaint, permitting the plaintiff to file a second amended complaint on or before March 1, 2024, if the deficiencies found in the amended complaint by the court can be cured.

As previously disclosed, the company received voluntary requests for information and documents from the SEC relating to the company’s policies, procedures and disclosures in connection with cybersecurity incidents.

The company is cooperating with the SEC’s investigation of certain of the company’s cybersecurity risk disclosures and cybersecurity-related internal controls, including with respect to the material weaknesses that the company identified and disclosed in the company’s Annual Report on Form 10-K for the year ended December 31, 2022.

The company is in discussions with the SEC staff regarding a potential non-scienter-based settlement of the alleged issues arising from the investigation but there can be no assurance that the company will be able to resolve the matter on terms acceptable to the company and the SEC.

The company believes it has an adequate provision for this matter.

With respect to the specific legal proceedings and claims described above, except as otherwise noted, either (i) the amount or range of possible losses in excess of amounts accrued, if any, is not reasonably estimable or (ii) the company believes that the amount or range of possible losses in excess of amounts accrued that are estimable would not be material.

Nonetheless, the company is unable to predict the outcome from such matters and it is possible that an adverse result could be material to the company’s financial conditions, results of operations and cash flows.

Environmental Matters

As of December 31, 2023, the company has an estimated environmental liability for a site that its predecessor company previously operated of approximately $ 28 million, of which $ 13 million is reported in other accrued liabilities and $ 15 million in other long-term liabilities on the company’s consolidated balance sheet.

The company has an agreement related to this site, which provides for a partial reimbursement of certain costs when all cleanup work has been approved and finalized.

As of December 31, 2023, the company expects to recover approximately $ 32 million, which is included in other long-term assets on the company’s consolidated balance sheet.

Note 19 — Stockholders’ equity

The company has 150 million authorized shares of common stock, par value $ .01 per share, and 40 million shares of authorized preferred stock, par value $ 1 per share, issuable in series.

At December 31, 2022, 12.2 million shares of unissued common stock of the company were reserved principally for future issuance under stock-based incentive plans.

At December 31, 2023, 11.5 million shares of unissued common stock of the company were reserved for future issuance.

Accumulated other comprehensive loss is as follows:

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Balance at December 31, 2020 $ ( 3,939.5 ) $ ( 826.6 ) $ ( 3,112.9 )

Other comprehensive income before reclassifications 489.4 78.6 410.8

Amounts reclassified from accumulated other comprehensive loss ( 340.3 ) ( 32.3 ) ( 308.0 )

Current period other comprehensive income 149.1 46.3 102.8

Balance at December 31, 2020 ( 3,939.5 ) ( 826.6 ) ( 3,112.9 )

Other comprehensive income (loss) before reclassifications 58.6 ( 43.6 ) 102.2

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Balance at December 31, 2022 ( 3,076.0 ) ( 977.4 ) ( 2,098.6 )

Other comprehensive (loss) income before reclassifications ( 142.8 ) 68.3 ( 211.1 )

Amounts reclassified from accumulated other comprehensive loss 418.5 ( 3.7 ) 422.2

Current period other comprehensive income 275.7 64.6 211.1

Balance at December 31, 2023 $ ( 2,800.3 ) $ ( 912.8 ) $ ( 1,887.5 )

Amounts reclassified out of accumulated other comprehensive loss are as follows:

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$ ( 3.7 ) $ 2.9 $ 4.0

Postretirement Plans:

Amortization of prior service cost (ii)

Postretirement plans (ii) :

Amortization of prior service credit

( 5.4 ) ( 5.8 ) ( 6.2 )

Amortization of actuarial losses (ii)

Amortization of actuarial losses

80.5 159.0 178.9

Settlement losses (ii)

Settlement losses

348.9 — 499.4

Total before tax 420.3 156.1 676.1

Income tax benefit ( 6.0 ) ( 59.3 ) 5.5

( 1.8 ) ( 6.0 ) ( 59.3 )

Total reclassifications for the period $ 418.5 $ 150.1 $ 616.8

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Balance at December 31, 2020 66.8 3.8

Debt exchange 4.6 1.2

Stock-based compensation 1.1 0.3

Balance at December 31, 2021 72.5 5.3

Debt exchange 4.6 1.2

Stock-based compensation 0.8 0.2

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Note 20 — Segment information

In January 2022, the company changed the grouping of certain immaterial revenue streams.

As a result, certain prior period segment revenue as well as the related cost of sales amounts have been reclassified to be comparable to the current period’s presentation.

In addition, during 2022, the company renamed its Cloud and Infrastructure Solutions segment as Cloud, Applications & Infrastructure Solutions to better represent the nature of the segment’s operations.

There was no change to the composition of the segment or its historical results.

The company’s reportable segments are as follows:

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The accounting policies of each segment are the same as those followed by the company as a whole.

Intersegment sales and transfers are priced as if the sales or transfers were to third parties.

Accordingly, the ECS segment records intersegment revenue and manufacturing profit on hardware and software shipments to customers under contracts of other segments.

These segments, in turn, record customer revenue and marketing profits on such shipments of company hardware and software to customers.

In the company’s consolidated statements of income (loss), the manufacturing costs of products sourced from the ECS segment and sold to other segments’ customers are reported in cost of revenue for these other segments.

Also included in the ECS segment’s sales and gross profit are sales of hardware and software sold to other segments for internal use in their engagements.

The amount of such profit included in gross profit of the ECS segment for the years ended December 31, 2021 and 2020 was $ 1.4 million and $ 7.8 million, respectively.

The sales and profit on these transactions is eliminated in consolidation.

The company evaluates segment performance based on gross profit exclusive of the service cost component of postretirement income or expense, restructuring charges, amortization of purchased intangibles and unusual and nonrecurring items, which are included in other gross profit.

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Total consolidated revenue $ 2,015.4 $ 1,979.9 $ 2,054.4

Presented below is a reconciliation of total segment gross profit to total consolidated loss from continuing operations before income taxes:

Presented below is a reconciliation of total segment gross profit to total consolidated loss before income taxes:

Year ended December 31, 2023 2022 2021

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Other (expense), net ( 393.9 ) ( 82.4 ) ( 580.3 )

Total loss from continuing operations before income taxes $ ( 62.6 ) $ ( 461.7 ) $ ( 271.8 )

Total loss before income taxes $ ( 347.8 ) $ ( 62.6 ) $ ( 461.7 )

Other revenue and other gross profit (loss) are comprised of an aggregation of a number of immaterial business activities and cost reduction charges.

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United States $ 19.5 $ 36.0 $ 66.2

United Kingdom 17.9 36.3 55.3

Australia 7.8 9.5 16.7

United Kingdom 2.0 17.9 36.3

Other foreign (i)

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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