公司擁有一項活躍的股權激勵計劃，即Alight, Inc. 2021 Omnibus Incentive Plan（「激勵計劃」），根據該計劃，公司已獲得授權向關鍵員工和非僱員董事授予股權激勵，包括限制性股票單位（「RSUs」）和績效股票單位（「PRSUs」）。根據該計劃，在2024年6月30日結束的6個月期間發放的授予，約爲
We define adjusted net income as net income (loss) attributable to Baldwin adjusted for depreciation, amortization, change in fair value of contingent consideration and certain items of income and expense, including share-based compensation expense, transaction-related Partnership and integration expenses, severance, and certain non-recurring costs that, in the opinion of management, significantly affect the period-over-period assessment of operating results, and the related tax effect of those adjustments. We believe that adjusted net income is an appropriate measure of operating performance because it eliminates the impact of income and expenses that do not relate to business performance.
Adjusted diluted EPS measures our per share earnings excluding certain expenses as discussed above for adjusted net income and assuming all shares of Class B common stock were exchanged for Class A common stock on a one-for-one basis. Adjusted diluted EPS is calculated as adjusted net income divided by adjusted diluted weighted-average shares outstanding. We believe adjusted diluted EPS is useful to investors because it enables them to better evaluate per share operating performance across reporting periods.
Adjusted EBITDA and Adjusted EBITDA Margin
The following table reconciles adjusted EBITDA and adjusted EBITDA margin to net loss, which we consider to be the most directly comparable GAAP financial measure:
For the Three Months Ended September 30,
For the Nine Months Ended September 30,
(in thousands, except percentages)
2024
2023
2024
2023
Revenues
$
338,938
$
306,270
$
1,059,145
$
933,907
Net loss
$
(14,475)
$
(32,006)
$
(6,242)
$
(101,523)
Adjustments to net loss:
Interest expense, net
31,329
30,580
94,203
87,600
Amortization expense
26,899
23,183
76,334
69,505
Share-based compensation
17,949
14,598
46,764
46,637
Gain on divestitures
(1,809)
—
(38,953)
—
Change in fair value of contingent consideration
(952)
13,914
17,276
55,065
Loss on extinguishment and modification of debt
389
—
15,068
—
Colleague earnout incentives
4,327
—
10,706
—
Transaction-related Partnership and integration expenses
2,047
3,774
9,042
18,007
Depreciation expense
1,557
1,453
4,619
4,250
Severance
678
875
3,554
3,373
Income and other taxes
82
161
3,300
904
Loss on interest rate caps
84
818
244
489
Other(1)
4,646
6,659
13,410
20,289
Adjusted EBITDA
$
72,751
$
64,009
$
249,325
$
204,596
Adjusted EBITDA margin
21
%
21
%
24
%
22
%
__________
(1) Other addbacks to adjusted EBITDA include certain expenses that are considered to be non-recurring or non-operational, including certain recruiting costs, professional fees, litigation costs and bonuses.
33
Organic Revenue and Organic Revenue Growth
The following table reconciles organic revenue and organic revenue growth to commissions and fees, which we consider to be the most directly comparable GAAP financial measure:
For the Three Months Ended September 30,
For the Nine Months Ended September 30,
(in thousands, except percentages)
2024
2023
2024
2023
Commissions and fees
$
335,210
$
304,232
$
1,050,409
$
929,306
Partnership commissions and fees(1)
—
(985)
—
(44,696)
Organic revenue
$
335,210
$
303,247
$
1,050,409
$
884,610
Organic revenue growth(2)
$
40,672
$
47,523
$
144,844
$
150,471
Organic revenue growth %(2)
14
%
19
%
16
%
20
%
__________
(1) Includes the first twelve months of such commissions and fees generated from newly acquired Partners.
(2) Organic revenue for the three and nine months ended September 30, 2023 used to calculate organic revenue growth for the three and nine months ended September 30, 2024 was $294.5 million and $905.6 million, respectively, which is adjusted to exclude commissions and fees from divestitures that occurred during 2024.
34
Adjusted Net Income and Adjusted Diluted EPS
The following table reconciles adjusted net income to net loss attributable to Baldwin and reconciles adjusted diluted EPS to diluted loss per share, which we consider to be the most directly comparable GAAP financial measures:
For the Three Months Ended September 30,
For the Nine Months Ended September 30,
(in thousands, except per share data)
2024
2023
2024
2023
Net loss attributable to Baldwin
$
(8,377)
$
(17,629)
$
(4,356)
$
(55,658)
Net loss attributable to noncontrolling interests
(6,098)
(14,377)
(1,886)
(45,865)
Amortization expense
26,899
23,183
76,334
69,505
Share-based compensation
17,949
14,598
46,764
46,637
Gain on divestitures
(1,809)
—
(38,953)
—
Change in fair value of contingent consideration
(952)
13,914
17,276
55,065
Loss on extinguishment and modification of debt
389
—
15,068
—
Colleague earnout incentives
4,327
—
10,706
—
Transaction-related Partnership and integration expenses
2,047
3,774
9,042
18,007
Depreciation
1,557
1,453
4,619
4,250
Amortization of deferred financing costs
1,422
1,244
4,419
3,577
Severance
678
875
3,554
3,373
Loss on interest rate caps, net of cash settlements
84
3,771
2,544
8,382
Income tax expense
—
—
2,151
—
Other(1)
4,646
6,659
13,410
20,289
Adjusted pre-tax income
42,762
37,465
160,692
127,562
Adjusted income taxes(2)
4,234
3,709
15,909
12,629
Adjusted net income
$
38,528
$
33,756
$
144,783
$
114,933
Weighted-average shares of Class A common stock outstanding - diluted
64,012
60,549
63,001
59,791
Dilutive weighted-average shares of Class A common stock
Effect of exchange of Class B common stock and net loss attributable to noncontrolling interests per share
0.01
0.02
0.02
0.06
Other adjustments to loss per share
0.49
0.59
1.42
1.96
Adjusted income taxes per share
(0.04)
(0.03)
(0.14)
(0.11)
Adjusted diluted EPS
$
0.33
$
0.29
$
1.23
$
0.98
___________
(1) Other addbacks to adjusted net income include certain expenses that are considered to be non-recurring or non-operational, including certain recruiting costs, professional fees, litigation costs and bonuses.
(2) Represents corporate income taxes at an assumed effective tax rate of 9.9% applied to adjusted pre-tax income.
(3) Assumes the full exchange of Class B common stock for Class A common stock pursuant to the Amended LLC Agreement.
35
INSURANCE ADVISORY SOLUTIONS OPERATING GROUP RESULTS
IAS provides expertly-designed commercial risk management, employee benefits and private risk management solutions for businesses and high-net-worth individuals, as well as their families, through our national footprint, which has assimilated some of the highest quality independent insurance brokers in the country with vast and varied strategic capabilities and expertise.
Effective January 1, 2024, our FounderShield Partner moved from UCTS to IAS. Prior year results of operations for IAS below have been recast to conform to the current organizational structure.
For the Three Months Ended September 30,
Variance
For the Nine Months Ended September 30,
Variance
(in thousands, except percentages)
2024
2023
Amount
%
2024
2023
Amount
%
Revenues:
Commissions and fees
$
157,535
$
147,523
$
10,012
7
%
$
545,384
$
502,991
$
42,393
8
%
Investment income
1,803
1,281
522
41
%
4,426
2,505
1,921
77
%
Total revenues
159,338
148,804
10,534
7
%
549,810
505,496
44,314
9
%
Operating expenses:
Commissions, employee compensation and benefits
119,266
103,639
15,627
15
%
383,086
335,289
47,797
14
%
Other operating expenses
20,098
19,867
231
1
%
59,328
59,809
(481)
(1)
%
Amortization expense
16,435
13,447
2,988
22
%
46,087
40,338
5,749
14
%
Change in fair value of contingent consideration
(4,195)
7,882
(12,077)
(153)
%
9,709
36,095
(26,386)
(73)
%
Depreciation expense
363
388
(25)
(6)
%
1,094
1,155
(61)
(5)
%
Total operating expenses
151,967
145,223
6,744
5
%
499,304
472,686
26,618
6
%
Operating income
7,371
3,581
3,790
106
%
50,506
32,810
17,696
54
%
Total other income (expense)
1,828
(167)
1,995
n/m
5,138
(12)
5,150
n/m
Income before income taxes
$
9,199
$
3,414
$
5,785
169
%
$
55,644
$
32,798
$
22,846
70
%
__________
n/m not meaningful
Commissions and Fees
IAS generates (i) commissions for placing insurance policies on behalf of its Insurance Company Partners; (ii) profit-sharing income based on either the underlying book of business or performance, such as loss ratios; and (iii) fees from consulting and service fee arrangements, which are in place with certain Clients for a negotiated fee.
IAS commissions and fees increased $10.0 million for the quarter ended September 30, 2024 compared to the same period of 2023, due to higher core commissions and fees, which grew organically by 6%. Growth in our core commissions and fees was driven by 22% sales velocity (new business as a percentage of prior year commissions and fees) and resultant new business across Client industry sectors. Sales velocity for the quarter improved 400 bps over the same period of 2023 despite softness in our construction practice. New business growth was offset in part by rate and exposure of (4.7)% resulting from construction project work weakness and headwinds concentrated in our employee benefits practice. In addition, profit-sharing revenue increased $2.4 million for the quarter.
IAS commissions and fees increased $42.4 million for the year-to-date period ended September 30, 2024 compared to the same period of 2023, due to organic growth in core commissions and fees of 10%. Growth in our core commissions and fees was driven by 21% sales velocity, which improved 430 bps over the prior-year period, and resultant new business across Client industry sectors. New business growth was offset in part by rate and exposure headwinds of (1.0)% attributable largely to our real estate book, particularly catastrophe-exposed real estate, employee benefits practice, and construction project work weakness. In addition, profit-sharing revenue increased $1.5 million for the year-to-date period.
36
Investment Income
IAS investment income increased $0.5 million and $1.9 million for the quarter and year-to-date periods ended September 30, 2024 compared to the same periods of 2023, respectively, due to improvements in our cash management strategy and growing yield on our invested cash.
Commissions, Employee Compensation and Benefits
Commissions, employee compensation and benefits expense for IAS increased $15.6 million and $47.8 million for the quarter and year-to-date periods ended September 30, 2024 compared to the same periods of 2023, respectively, primarily due to an increase in Colleague compensation of $10.2 million and $25.1 million, respectively, driven by continued investments in headcount to support our growth, coupled with an increase in Colleague compensation allocated to IAS that was previously recognized in Corporate and Other. The quarter and year-to-date periods also included increases related to Colleague earnout incentives of $4.3 million and $10.3 million, respectively, for contingent earnout liabilities that were reclassified, at the Partner's option, to a bonus payable to Colleagues. In addition, variable inside commissions increased $8.0 million, or 7%, during the year-to-date period, in line with the growth in IAS’ core commissions and fees.
Other Operating Expenses
Other operating expenses for IAS were relatively flat for each of the quarter and year-to-date periods ended September 30, 2024 compared to the same periods of 2023. Other operating expenses for the year-to-date period included higher costs for legal claims and settlement expense of $1.9 million and travel and entertainment of $1.8 million to support the growth in IAS, which were offset in part by $1.8 million of cost savings from measures we have implemented, including the renegotiation of vendor contracts and post Partnership integration operational efficiencies gained, and a reduction in professional fees of $1.1 million.
Amortization Expense
IAS amortization expense increased $3.0 million and $5.7 million for the quarter and year-to-date periods ended September 30, 2024 compared to the same periods of 2023, respectively, due to the acceleration of trade names amortization in connection with rebranding within IAS.
Change in Fair Value of Contingent Consideration
Change in fair value of contingent consideration for IAS was a $4.2 million gain for the quarter ended September 30, 2024 compared to a $7.9 million loss for the same period of 2023, and a $9.7 million loss for the year-to-date period ended September 30, 2024 compared to a $36.1 million loss for the same period of 2023. The fair value gain for the quarter ended September 30, 2024 was impacted by Colleague earnout incentives of $4.3 million, which were reclassified, at the Partner's option, from contingent earnout liabilities to a bonus payable to Colleagues, thereby resulting in a gain in the change in fair value of contingent consideration and an increase to commissions, employee compensation and benefits expense. The fair value loss related to contingent consideration for the year-to-date period ended September 30, 2024 was impacted by positive changes in revenue growth trends of certain partners, offset in part by a gain recognized in connection with the reclassification of $10.7 million to Colleague earnout incentives.
UNDERWRITING, CAPACITY & TECHNOLOGY SOLUTIONS OPERATING GROUP RESULTS
UCTS consists of two distinct businesses—MSI and our newly launched reinsurance brokerage business, Juniper Re. Through MSI, we manufacture proprietary, technology-enabled insurance products with a focus on sheltered channels where our products deliver speed, ease of use and certainty of execution, an example of which is our national embedded renters insurance product sold at point of lease via integrations with property management software providers. Our MGA product suite is now comprised of more than 20 products across personal, commercial and professional lines. UCTS’ Wholesale Business was sold in the first quarter of 2024 and its operations are included in our results through February 29, 2024.
Effective January 1, 2024, our FounderShield Partner moved from UCTS to IAS. Prior year results of operations for UCTS below have been recast to conform to the current organizational structure.
37
For the Three Months Ended September 30,
Variance
For the Nine Months Ended September 30,
Variance
(in thousands, except percentages)
2024
2023
Amount
%
2024
2023
Amount
%
Revenues:
Commissions and fees
$
128,718
$
113,313
$
15,405
14
%
$
353,373
$
301,357
$
52,016
17
%
Investment income
1,076
705
371
53
%
2,803
1,305
1,498
115
%
Total revenues
129,794
114,018
15,776
14
%
356,176
302,662
53,514
18
%
Operating expenses:
Commissions, employee compensation and benefits
98,037
82,593
15,444
19
%
268,818
220,999
47,819
22
%
Other operating expenses
11,086
10,308
778
8
%
32,473
30,537
1,936
6
%
Amortization expense
3,850
3,999
(149)
(4)
%
10,730
11,965
(1,235)
(10)
%
Change in fair value of contingent consideration
3,032
5,538
(2,506)
(45)
%
7,355
17,681
(10,326)
(58)
%
Depreciation expense
151
159
(8)
(5)
%
463
460
3
1
%
Total operating expenses
116,156
102,597
13,559
13
%
319,839
281,642
38,197
14
%
Operating income
13,638
11,421
2,217
19
%
36,337
21,020
15,317
73
%
Total other income, net
57
—
57
n/m
34,133
819
33,314
n/m
Income before income taxes
$
13,695
$
11,421
$
2,274
20
%
$
70,470
$
21,839
$
48,631
n/m
__________
n/m not meaningful
Commissions and Fees
UCTS generates (i) commissions for underwriting and placing insurance policies on behalf of its Insurance Company Partners; (ii) policy fee and installment fee revenue for acting in the capacity of an MGA and fulfilling certain administrative functions on behalf of Insurance Company Partners, including delivery of policy documents, processing payments and other administrative functions; (iii) profit-sharing income, generally based on the profitability of the underlying book of business of the policies it generates on behalf of its Insurance Company Partners; and (iv) fees from service fee arrangements, which are in place with certain customers for a negotiated fee.
UCTS commissions and fees increased $15.4 million and $52.0 million for the quarter and year-to-date periods ended September 30, 2024 compared to the same periods of 2023, respectively, due to higher core commissions and fees, which grew organically by 31% and 36% for the comparative periods, respectively. Growth in our core commissions and fees was driven by continued outperformance in our multi-family business (accounting for $10.9 million and $29.3 million of the quarter and year-to-date increases in core commissions and fees, respectively), momentum in our homeowners (accounting for $8.9 million and $27.5 million of the quarter and year-to-date increases in core commissions and fees, respectively) and commercial umbrella products (accounting for $2.2 million and $9.8 million of the of the quarter and year-to-date increases in core commissions and fees, respectively), and growing contribution from our reinsurance brokerage business and commercial property program. These increases were partially offset by reductions in profit-sharing revenue for each of the periods, which is primarily a function of strong profit sharing revenue in the 2023 periods, driven by both historically strong underwriting performance in the 2023 periods and timing differences. In addition, our Wholesale Business, which was sold in the first quarter of 2023, generated $9.3 million of commissions and fees during the third quarter of 2023 and $21.3 million of commissions and fees between March and September of 2023, for which there were no comparable revenues earned in 2024.
The initial term for the QBE Program Administrator Agreement expires in May of 2025, but has an extended term through May of 2027 during which MSI is required to assist QBE in arranging adequate reinsurance covering the business to be written between May 2025 and May 2027. The Company is currently working to assist QBE in arranging the reinsurance required to extend the QBE Program Administrator Agreement through May 2027.
Investment Income
UCTS investment income increased $0.4 million and $1.5 million for the quarter and year-to-date periods ended September 30, 2024 compared to the same periods of 2023, respectively, due to improvements in our cash management strategy and growing yield on our invested cash.
38
Commissions, Employee Compensation and Benefits
Commissions, employee compensation and benefits expense for UCTS includes both outside commissions paid to partners that distribute our MGA products and compensation paid to Colleagues. Commissions, employee compensation and benefits expense for UCTS increased $15.4 million and $47.8 million for the quarter and year-to-date periods ended September 30, 2024 compared to the same periods of 2023, respectively, primarily driven by outside commissions, which increased $13.9 million, or 23%, for the quarter, and $40.3 million, or 26%, for the year-to-date period, in line with the growth in UCTS’ core commissions and fees. The year-to-date period also included increases in benefits and other expense of $5.0 million and Colleague compensation of $4.8 million, driven by continued investments in headcount to support the growth of existing and new products, coupled with an increase in Colleague compensation allocated to UCTS that was previously recognized in Corporate and Other.
Other Operating Expenses
Other operating expenses for UCTS increased $0.8 million and $1.9 million for the quarter and year-to-date periods ended September 30, 2024 compared to the same periods of 2023, respectively. The increase in other operating expenses for the year-to-date period was driven by higher costs due to fulfilling certain administrative functions on behalf of Insurance Company Partners (including an increase in payment processing fees) of $2.9 million, generally higher costs to support the growth of the business and the launch of new products of $1.8 million, travel and entertainment of $0.8 million to support our growth, and legal claims and settlement expense of $0.7 million. These increases were offset in part by reductions in Partnership integration expenses of $2.9 million and professional fees of $1.3 million.
Amortization Expense
UCTS amortization expense decreased $0.1 million and $1.2 million for the quarter and year-to-date periods ended September 30, 2024 compared to the same periods of 2023, respectively, primarily due to the write-off of intangible assets in connection with the sale of our Wholesale Business during the first quarter of 2024.
Change in Fair Value of Contingent Consideration
Change in fair value of contingent consideration for UCTS was a $3.0 million loss for the quarter ended September 30, 2024 compared to a $5.5 million loss for the same period of 2023, and a $7.4 million loss for the year-to-date period ended September 30, 2024 compared to a $17.7 million loss for the same period of 2023. The fair value losses related to contingent consideration for 2024 were impacted by positive changes in revenue growth trends of certain partners and accretion of the contingent earnout obligations approaching their respective measurement dates.
Total Other Income
Total other income for UCTS of $34.1 million for the year-to-date period ended September 30, 2024 was driven by a $35.1 million gain recorded in connection with the sale of our Wholesale Business during the first quarter of 2024.
39
MAINSTREET INSURANCE SOLUTIONS OPERATING GROUP RESULTS
MIS offers personal insurance, commercial insurance, and life and health solutions to individuals and businesses in their communities, with a focus on accessing clients via sheltered distribution channels, which include, but are not limited to, new home builders, realtors, mortgage originators/lenders, master planned communities, and various other community centers of influence. MIS also offers consultation for government assistance programs and solutions, including traditional Medicare, Medicare Advantage and Affordable Care Act, to seniors and eligible individuals through a network of primarily independent contractor agents.
For the Three Months Ended September 30,
Variance
For the Nine Months Ended September 30,
Variance
(in thousands, except percentages)
2024
2023
Amount
%
2024
2023
Amount
%
Revenues:
Commissions and fees
$
70,658
$
62,297
$
8,361
13
%
$
209,422
$
174,114
$
35,308
20
%
Operating expenses:
Commissions, employee compensation and benefits
42,372
37,536
4,836
13
%
131,603
109,257
22,346
20
%
Other operating expenses
9,123
7,769
1,354
17
%
25,765
23,243
2,522
11
%
Amortization expense
6,368
5,701
667
12
%
18,945
17,160
1,785
10
%
Change in fair value of contingent consideration
211
494
(283)
(57)
%
212
1,289
(1,077)
(84)
%
Depreciation expense
190
151
39
26
%
528
419
109
26
%
Total operating expenses
58,264
51,651
6,613
13
%
177,053
151,368
25,685
17
%
Operating income
12,394
10,646
1,748
16
%
32,369
22,746
9,623
42
%
Total other income (expense), net
4
(13)
17
(131)
%
2
29
(27)
(93)
%
Income before income taxes
$
12,398
$
10,633
$
1,765
17
%
$
32,371
$
22,775
$
9,596
42
%
Commissions and Fees
MIS generates (i) commissions for placing insurance policies on behalf of its Insurance Company Partners; (ii) profit-sharing income based on either the underlying book of business or performance, such as loss ratios; and (iii) commissions and fees in the form of marketing income, which is earned through co-branded marketing campaigns with our Insurance Company Partners.
MIS commissions and fees increased $8.4 million and $35.3 million for the quarter and year-to-date periods ended September 30, 2024 compared to the same periods of 2023, respectively, due to higher core commissions and fees, which grew organically by $6.2 million, or 11%, for the quarter, and $31.4 million, or 20%, for the year-to-date period. Key drivers of the organic growth in MIS core commissions and fees included our Westwood Partner (accounting for $3.2 million and $15.8 million of the quarter and year-to-date increases in core commissions and fees, respectively), our legacy Mainstreet business (accounting for $2.5 million and $12.0 million of the quarter and year-to-date increases in core commissions and fees, respectively), and the national mortgage and real estate channel (accounting for $0.5 million and $3.6 million of the quarter and year-to-date increases in core commissions and fees, respectively). In addition, MIS profit-sharing and other revenue increased $2.2 million and $4.1 million for the quarter and year-to-date periods, respectively, primarily resulting from improvements in loss ratios and the number of policies sold.
Commissions, Employee Compensation and Benefits
Commissions, employee compensation and benefits expense for MIS increased $4.8 million and $22.3 million for the quarter and year-to-date periods ended September 30, 2024 compared to the same periods of 2023, respectively, primarily due to outside commissions, which increased $3.2 million, or 20%, for the quarter, and $12.8 million, or 28%, for the year-to-date period, relating to growth in our Westwood and legacy Mainstreet businesses. The quarter and year-to-date periods also included higher Colleague compensation of $0.7 million and $6.1 million, respectively, driven by continued investments in headcount to support our growth, coupled with an increase in Colleague compensation allocated to MIS that was previously recognized in Corporate and Other.
40
Other Operating Expenses
Other operating expenses for MIS increased $1.4 million and $2.5 million for the quarter and year-to-date periods ended September 30, 2024 compared to the same periods of 2023, respectively. The increase in other operating expenses for the quarter and year-to-date periods was driven by higher technology-related costs to support the growth of the business of $0.3 million and $0.9 million, respectively, licenses and taxes of $0.2 million and $0.5 million, respectively, travel and entertainment of $0.2 million and $0.4 million, respectively, and advertising and marketing of $0.4 million and $0.1 million, respectively.
Amortization Expense
MIS amortization expense increased $0.7 million and $1.8 million for the quarter and year-to-date periods ended September 30, 2024 compared to the same periods of 2023, respectively, primarily driven by higher amortization of intangible assets recorded in connection with our Westwood Partnership, which are amortized based on a pattern of estimated economic benefit.
CORPORATE AND OTHER RESULTS
For the Three Months Ended September 30,
Variance
For the Nine Months Ended September 30,
Variance
(in thousands, except percentages)
2024
2023
Amount
%
2024
2023
Amount
%
Revenues:
Commissions and fees
$
(21,701)
$
(18,901)
$
(2,800)
15
%
$
(57,770)
$
(49,156)
$
(8,614)
18
%
Investment income
849
52
797
n/m
1,507
791
716
91
%
Total revenues
(20,852)
(18,849)
(2,003)
11
%
(56,263)
(48,365)
(7,898)
16
%
Operating expenses:
Commissions, employee compensation and benefits
(12,486)
(3,299)
(9,187)
n/m
(29,911)
11,114
(41,025)
n/m
Other operating expenses
8,532
9,221
(689)
(7)
%
23,632
27,665
(4,033)
(15)
%
Amortization expense
246
36
210
n/m
572
42
530
n/m
Depreciation expense
853
755
98
13
%
2,534
2,216
318
14
%
Total operating expenses
(2,855)
6,713
(9,568)
(143)
%
(3,173)
41,037
(44,210)
(108)
%
Operating loss
(17,997)
(25,562)
7,565
(30)
%
(53,090)
(89,402)
36,312
(41)
%
Other expense:
Interest expense, net
(31,346)
(30,574)
(772)
3
%
(94,230)
(87,781)
(6,449)
7
%
Loss on extinguishment and modification of debt
(389)
—
(389)
n/m
(15,068)
—
(15,068)
n/m
Other expense, net
(35)
(1,177)
1,142
(97)
%
(188)
(848)
660
(78)
%
Total other expense, net
(31,770)
(31,751)
(19)
—
%
(109,486)
(88,629)
(20,857)
24
%
Loss before income taxes
$
(49,767)
$
(57,313)
$
7,546
(13)
%
$
(162,576)
$
(178,031)
$
15,455
(9)
%
__________
n/m not meaningful
Commissions and Fees
Corporate and Other records the elimination of intercompany commissions revenue from the Operating Groups. During the quarter and year-to-date periods ended September 30, 2024, UCTS recorded commissions revenue shared within the same Operating Group of $3.6 million and $10.3 million, respectively; UCTS recorded commissions revenue passed through to other Operating Groups of $17.9 million and $46.3 million, respectively; and MIS recorded commissions revenue shared within the same Operating Group of $0.2 million and $1.2 million, respectively.
A substantial portion of the intercompany commissions revenue recorded during the year-to-date period is related to the QBE Program Administrator Agreement. We expect intercompany commissions revenue to continue to grow as we serve as the MGA on more intersegment revenue such as homeowners insurance sold through MIS.
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Commissions, Employee Compensation and Benefits
Commissions, employee compensation and benefits expense in Corporate and Other decreased $9.2 million and $41.0 million for the quarter and year-to-date periods ended September 30, 2024 compared to the same periods of 2023, respectively, driven by a reduction in Colleague compensation of $7.3 million and $30.9 million, respectively, due in part to a decrease in corporate-related headcount, including the retirement of two of our executive officers at the end of 2023, coupled with a decrease in Colleague compensation previously recognized in Corporate and Other that is now allocated to the Operating Groups. In addition, intercompany commissions expense eliminations increased $2.8 million and $8.6 million for the quarter and year-to-date periods, respectively.
A significant portion of the year-over-year increase in intercompany commissions expense eliminated through Corporate and Other is related to the QBE Program Administrator Agreement. We expect intercompany commissions expense to continue to grow as we serve as the MGA on more intersegment revenue such as homeowners insurance sold through MIS.
Other Operating Expenses
Other operating expenses in Corporate and Other decreased $0.7 million for the quarter ended September 30, 2024 compared to the same period of 2023 due, in part, to certain cost saving measures we have implemented, including the renegotiation of vendor contracts, and operational efficiencies gained from Partnership integration projects by our Operating Groups during 2023, offset in part by higher costs incurred in connection with our rebranding.
Other operating expenses in Corporate and Other decreased $4.0 million for the year-to-date period ended September 30, 2024 compared to the same period of 2023 due to reductions in professional fees of $2.2 million, travel and entertainment of $1.6 million, infrastructure-related costs of $1.2 million and rent expense of $0.7 million. These cost savings are due, in part, to certain cost saving measures we have implemented, including the renegotiation of vendor contracts, and operational efficiencies gained from Partnership integration projects by our Operating Groups. These decreases were offset in part by higher licenses and taxes expense of $1.0 million and higher advertising and marketing costs of $0.7 million connected to our rebranding.
Interest Expense, Net
Interest expense, net, in Corporate and Other increased $0.8 million and $6.4 million for the quarter and year-to-date periods ended September 30, 2024 compared to the same periods of 2023, respectively, resulting from higher average borrowings, offset in part by lower average interest rates resulting from the May 2024 debt refinancing. We expect interest expense to remain relatively flat or increase slightly in the near-term on a year-over-year basis.
Loss on Extinguishment and Modification of Debt
Loss on extinguishment and modification of debt in Corporate and Other of $15.1 million for the year-to-date period ended September 30, 2024 relates to the May 2024 debt refinancing.
Other Expense, Net
Other expense, net, in Corporate and Other decreased $1.1 million and $0.7 million for the quarter and year-to-date periods ended September 30, 2024 compared to the same periods of 2023, respectively, driven by losses recognized on interest rate caps during the 2023 periods in connection with an interest rate cap that expired in March 2024.
LIQUIDITY AND CAPITAL RESOURCES
Our primary liquidity needs for the foreseeable future will include cash to (i) provide capital to facilitate the organic growth of our business and to fund future Partnerships, (ii) pay operating expenses, including cash compensation to our Colleagues and expenses related to being a public company, (iii) make payments under the Tax Receivable Agreement, (iv) pay interest and principal due on borrowings under the 2024 Credit Facility and the Senior Secured Notes, (v) pay contingent earnout liabilities, (vi) pay income taxes, and (vii) fund potential investments in third party businesses that support the growth of our business, which may include Emerald Bay or sponsorship of, and a minority, non-controlling interest in, other investment funds, the purpose of which may include facilitating the establishment of additional and alternative capacity that supports the growth of our MSI business.
We have historically financed our operations and funded our debt service through the sale of our insurance products and services, and we have financed significant cash needs to fund growth through the acquisition of Partners through debt and equity financing.
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On May 24, 2024, we repaid in full our then-outstanding debt with proceeds from an offering of $600 million in aggregate principal amount of 7.125% senior secured notes due May 15, 2031 (the “Senior Secured Notes”) and borrowings under a new $840 million senior secured first lien term loan facility maturing May 24, 2031 (the “2024 Term Loan”). In connection with the refinancing, we also established a new senior secured first lien revolving facility with commitments in an aggregate principal amount of $600 million maturing May 24, 2029 (the “2024 Revolving Facility” and, together with the 2024 Term Loan, the “2024 Credit Facility”). Proceeds from the issuance of the Senior Secured Notes and the 2024 Term Loan were also used to pay related fees, costs, expenses and accrued interest. Refer to Note 8 to our condensed consolidated financial statements included in Part I, Item 1. Financial Statements of this report for more information relating to the terms of the Senior Secured Notes and 2024 Credit Facility.
In the near term, we intend to fund our earnout obligations with cash and cash equivalents, including unused proceeds from the issuance of the Senior Secured Notes and the 2024 Term Loan, cash flow from operations and available borrowings under the 2024 Revolving Facility. From time to time, we will consider raising additional debt or equity financing if and as necessary to support our growth, including in connection with the exploration of Partnership opportunities or to refinance existing obligations on an opportunistic basis.
As of September 30, 2024, our cash and cash equivalents were $181.8 million and we had $600.0 million of available borrowing capacity on the 2024 Revolving Facility. We believe that our cash and cash equivalents, cash flow from operations and available borrowings will be sufficient to fund our working capital and meet our commitments for the next twelve months and beyond.
Contractual Obligations and Commitments
The following table represents our contractual obligations and commitments, aggregated by type, at September 30, 2024:
(1) Represents noncancelable operating leases for our facilities. Operating lease expense was $16.2 million and $16.8 million for the nine months ended September 30, 2024 and 2023, respectively.
(2) Represents scheduled debt obligations and estimated interest payments for our Senior Secured Notes and 2024 Term Loan.
(3) Represents the total expected future payments to be made to Partners at September 30, 2024.
Our contractual obligations and commitments are comprised of operating lease obligations, principal and interest payments on our borrowings under the Senior Secured Notes and the 2024 Term Loan, estimated payments of contingent earnout liabilities and our commitment to the University of South Florida (“USF”).
Our operating lease obligations represent noncancelable agreements for our corporate headquarters and office space for our insurance brokerage business. Our operating lease agreements expire through March 2032. These obligations do not include leases with an initial term of twelve months or less, which are expensed as incurred. We may extend, terminate or otherwise modify or sub-lease facilities as needed to best suit the needs of our business. The lease term is the non-cancelable period of the lease and includes options to extend or terminate the lease when it is reasonably certain that an option will be exercised.
Our debt obligations at September 30, 2024 include borrowings outstanding under the Senior Secured Notes of $600 million and the 2024 Term Loan of $837.9 million. Estimated interest payments for outstanding borrowings on the Senior Secured Notes and 2024 Term Loan in the table above were calculated based on the applicable interest rates at September 30, 2024 of 7.125% and 8.10%, respectively, through their respective due dates of May 15, 2031 and May 24, 2031.
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Substantially all of our Partnerships and certain acquisitions of select books of business that do not constitute a complete business enterprise include contractual earnout provisions. We record an estimation of the fair value of the contingent earnout obligations at the Partnership date as a component of the consideration paid. Our contingent earnout obligations are measured at fair value each reporting period based on the present value of the expected future payments to be made to Partners in accordance with the provisions outlined in the respective purchase agreements. The recorded obligations are based on estimates of the Partners’ future performance using financial projections for the earnout period. The aggregate estimated contingent earnout liabilities included on our condensed consolidated balance sheet at September 30, 2024 was $203.8 million, of which $4.5 million must be settled in cash and the remaining $199.3 million can be settled in cash or stock at our option. The undiscounted estimated contingent earnout obligation presented in the table above represents the total expected future payments to be made to the Partners. The undiscounted estimated contingent earnout obligation at September 30, 2024 was $205.2 million, of which $5.0 million must be settled in cash and the remaining $200.2 million can be settled in cash or stock at our option. The maximum estimated exposure to the contingent earnout liabilities was $329.2 million at September 30, 2024.
As of September 30, 2024, we have a remaining commitment to USF to donate $4.2 million through October 2028. The gift will provide support for the School of Risk Management and Insurance in the USF Muma College of Business. It is currently anticipated that Lowry Baldwin, our Chairman, will fund half of this commitment.
Tax Receivable Agreement
We expect to obtain an increase in our share of the tax basis in the assets of Baldwin Holdings when its LLC Units are redeemed or exchanged for shares of Baldwin’s Class A common stock. This increase in tax basis may have the effect of reducing the future amounts paid to various tax authorities. The increase in tax basis may also decrease gains (or increase losses) on future dispositions of certain capital assets to the extent tax basis is allocated to those capital assets.
We have a Tax Receivable Agreement that provides for the payment by us to the parties to the Tax Receivable Agreement of 85% of the amount of cash savings, if any, in U.S. federal, state and local income tax or franchise tax that we actually realize as a result of (i) any increase in tax basis in Baldwin’s assets and (ii) tax benefits related to imputed interest deemed arising as a result of payments made under the tax receivable agreement.
During the nine months ended September 30, 2024, we redeemed 2,408,931 LLC Units of Baldwin Holdings on a one-for-one basis for shares of Class A common stock and cancelled the corresponding shares of Class B common stock. We receive an increase in our share of the tax basis in the net assets of Baldwin Holdings due to the interests being redeemed. We have assessed the realizability of the net deferred tax assets and in that analysis have considered the relevant positive and negative evidence available to determine whether it is more likely than not that some portion or all of the deferred tax assets will be realized. We have recorded a full valuation allowance against the deferred tax assets at Baldwin as of September 30, 2024, which will be maintained until there is sufficient evidence to support the reversal of all or some portion of these allowances.
Sources and Uses of Cash
The following table summarizes our cash flows from operating, investing and financing activities for the periods indicated:
For the Nine Months Ended September 30,
(in thousands)
2024
2023
Variance
Net cash provided by operating activities
$
85,708
$
22,799
$
62,909
Net cash provided by (used in) investing activities
25,609
(16,948)
42,557
Net cash provided by (used in) financing activities
6,436
(41,928)
48,364
Net increase (decrease) in cash and cash equivalents and restricted cash
117,753
(36,077)
153,830
Cash and cash equivalents and restricted cash at beginning of period
226,963
230,471
(3,508)
Cash and cash equivalents and restricted cash at end of period
$
344,716
$
194,394
$
150,322
Operating Activities
The primary sources and uses of cash for operating activities are net income (loss) adjusted for non-cash items and changes in assets and liabilities, or operating working capital, and payment of contingent earnout consideration. Net cash provided by operating activities increased $62.9 million year over year, driven by an increase in cash related to the change in premiums, commissions and fees receivable, net of accounts payable, accrued expenses and other current liabilities of $38.2 million relating to holding fiduciary cash on behalf of our insurance company partners, and better operating leverage year over year.
44
Investing Activities
The primary sources and uses of cash for investing activities relate to cash consideration paid to fund Partnerships and other investments to grow our business. Net cash provided by investing activities increased $42.6 million year over year driven by cash proceeds from divestitures, net of cash transferred of $57.0 million, relating primarily to the sale of our Wholesale Business during 2024, offset in part by a decrease in cash relating to higher capital expenditures of $14.7 million due to software development projects.
Financing Activities
The primary sources and uses of cash for financing activities relate to the issuance of our Class A common stock; debt servicing costs in connection with our long-term debt and revolving line of credit, as well as purchases, sales and settlements of interest rate caps to mitigate interest rate volatility on that debt; payment of contingent earnout consideration; and other equity transactions. Net cash provided by financing activities increased $48.4 million year over year driven by an increase in net proceeds from borrowings on our credit facilities of $102.4 million resulting from the May 2024 debt refinancing, inclusive of the deferred financing costs incurred, offset in part by a decrease in cash from additional payments of contingent earnout consideration classified as financing activity of $37.9 million, an increase in tax distributions to Baldwin Holdings members of $10.7 million relating to the sale of our Wholesale Business during 2024, and fewer cash settlements from interest rate caps of $5.6 million.
CRITICAL ACCOUNTING ESTIMATES
Our consolidated financial statements are prepared in accordance with GAAP, which requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Our estimates, judgments and assumptions are continually evaluated based on historical experience, known or expected trends, independent valuations and other factors we believe to be reasonable under the circumstances. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates.
There have been no material changes in our critical accounting policies during the nine months ended September 30, 2024 as compared to those disclosed in the Critical Accounting Policies and Estimates section under Management’s Discussion and Analysis of Financial Condition and Results of Operations of our Annual Report on Form 10-K for the year ended December 31, 2023.
RECENT ACCOUNTING PRONOUNCEMENTS
Please refer to Note 1 to our condensed consolidated financial statements included in Part I, Item 1. Financial Statements of this report for a discussion of recent accounting pronouncements that may impact us.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Market risk is the potential loss arising from adverse changes in market rates and prices, such as premium amounts, interest rates and equity prices. We are exposed to market risk through our investments and borrowings under the 2024 Credit Facility. We use derivative instruments to mitigate our risk related to the effect of rising interest rates on our cash flows. However, we do not use derivative instruments for trading or speculative purposes.
Our invested assets are held primarily as cash and cash equivalents and restricted cash. To a lesser extent, we may also utilize certificates of deposit, U.S. treasury securities and professionally managed short duration fixed income funds. These investments are subject to market risk. The fair value of our invested assets at September 30, 2024 and December 31, 2023 approximated their respective carrying values due to their short-term duration and therefore, such market risk is not considered to be material.
At September 30, 2024, we had $837.9 million of borrowings outstanding under the 2024 Term Loan and no outstanding borrowings under our 2024 Revolving Facility. The 2024 Term Loan bears interest based on a variable rate of term SOFR, plus an applicable margin of 325 bps. An increase of 100 basis points on the term SOFR rate at September 30, 2024 would have increased our annual interest expense for the 2024 Credit Facility by $8.4 million.
Other than the entry into the 2024 Credit Facility and the expiration of our $300.0 million notional, 1.50% interest rate cap on March 10, 2024, there have been no material changes in market risk from the information presented in Part II, Item 7A. Quantitative and Qualitative Disclosures About Market Risk in our Annual Report on Form 10-K for the year ended December 31, 2023.
45
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of September 30, 2024 to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our senior management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosures.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting that occurred during the quarter ended September 30, 2024, which were identified in connection with management’s evaluation required by paragraph (d) of Rules 13a-15 and 15d-15 under the Exchange Act, that materially affected, or that are reasonably likely to materially affect, our internal control over financial reporting.
46
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Please refer to Note 13 to our condensed consolidated financial statements included in Part I, Item 1. Financial Statements of this report for a discussion of legal proceedings to which the Company is subject.
ITEM 1A. RISK FACTORS
See the risk factors outlined under Part I, Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on February 28, 2024.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Sales of Unregistered Securities
None.
Issuer Repurchases of Equity Securities
The following table provides information about our repurchase of shares of our Class A common stock during the three months ended September 30, 2024:
Total Number of Shares Purchased(1)
Average Price Paid per Share
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
Maximum Value that may yet be Purchased under the Plans or Programs
July 1, 2024 to July 31, 2024
48,517
$
37.37
—
$
—
August 1, 2024 to August 31, 2024
28,690
41.63
—
—
September 1, 2024 to September 30, 2024
3,227
46.00
—
—
Total
80,434
$
39.24
—
$
—
__________
(1) We purchased 80,434 shares during the three months ended September 30, 2024, which were acquired from our employees to cover required tax withholding on the vesting of shares granted under our Omnibus Incentive Plan or Partnership Inducement Award Plan.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5. OTHER INFORMATION
Insider Trading Arrangements and Policies
During the quarter ended September 30, 2024, none of our directors or officers adopted or terminated any contract, instruction or written plan for the purchase or sale of our securities intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any non-Rule 10b5-1 trading arrangement (as defined in Item 408(c) of Regulation S-K).
Adoption of Executive Severance Plan
On October 30, 2024, upon the recommendation of its Compensation Committee, the Board of Directors of the Company adopted and approved The Baldwin Insurance Group Holdings, LLC Executive Severance and Change in Control Benefit Program (the “Severance Plan”), effective November 1, 2024. The Severance Plan provides severance benefits to the Company’s executive officers and certain other eligible employees in the event of certain terminations of their employment and in connection with a Change in Control (as defined in the Severance Plan).
47
Retirement
Subject to the executive’s execution of a general release of liability in favor of the Company and compliance with the terms of a restrictive covenant agreement for five years following the retirement date, the Plan provides for retirement benefits to a retiring participant who either (i) is at least 50 years of age with more than 10 years of service to the Company, or (ii) has been continuously employed with the Company since its October 2019 initial public offering, including:
•payment of any earned but unpaid bonus under the Company’s annual incentive plan (“AIP”) for the completed prior year if the retirement date occurs prior to the scheduled date of the payment for such bonus;
•a portion of the retiring executive’s AIP payment for the year in which retirement occurs, determined in accordance with the applicable criteria under the AIP (assuming the “Target” threshold was achieved) and pro-rated for the time in the executive’s role for such year; and
•continued vesting of time-based and performance-based equity awards granted to the executive under the Company’s Omnibus Incentive Plan.
Qualifying Separation from Service With No Change in Control
The Severance Plan provides for the payment of severance and other benefits to each participating executive in the event of a termination of employment by the Company without Cause (as defined in the Severance Plan) or due to the executive’s voluntary resignation for Good Reason (as defined in the Severance Plan). The Severance Plan defines each event as a “Qualifying Separation from Service.” In the event of a Qualifying Separation from Service, subject to the executive’s execution of a general release of liability in favor of the Company and compliance with the terms of any restrictive covenant agreement for two years following the Qualifying Separation from Service, the Severance Plan provides for the following payments and benefits:
•a severance payment (paid over an 18-month period) calculated as base salary multiplied by one- and one-half in the case of the Chief Executive Officer, Chief Financial Officer, the President of The Baldwin Group and CEO of Retail Brokerage Operations, and the President of The Baldwin Group and CEO of Underwriting, Capacity & Technology Operations (collectively, the “Group 1 Executives”) or a severance payment (paid over a 12-month period) calculated as base salary multiplied by one in the case of the Chief Accounting Officer, General Counsel, Chief Colleague Officer, Chief Marketing Officer, and Chief Digital and Information Officer of the Company (collectively, the “Group 2 Executives”);
•payment of any earned but unpaid bonus under the Company’s AIP for the completed prior year if the Qualifying Separation from Service occurs prior to the scheduled date of the payment for such bonus;
•a portion of the executive’s AIP payment for the year in which the Qualifying Separation from Service occurs, determined in accordance with the applicable criteria (assuming the “Target” threshold was achieved) under the AIP and pro-rated for the time in the executive’s role for such year;
•continued vesting of time-based equity awards under the Company’s Omnibus Incentive Plan; and
•payment of the executive’s premiums under the Consolidated Budget Reconciliation Act of 1985, as amended from time to time (“COBRA”) for a period of up to 12 months following the Qualifying Separation from Service.
Changes in Control
The Severance Plan also provides for the payment of enhanced severance and other benefits to executives in the event of a Change in Control during the Protected Period (as defined in the Severance Plan). In the event of a Change in Control not involving a Qualifying Separation from Service within the period beginning 90 days before the Change in Control and ending on the date 12 months following the Change in Control (the “Change in Control Period”), the Severance Plan provides the following payments and benefits to the executives:
•continued participation in the applicable bonus program pursuant to the Company’s AIP or bonus provided by the executive’s employment agreement in the event the AIP or such employment agreement is assumed by the acquiror, or payment of a pro-rated bonus (assuming the “Target” threshold was achieved) based on the portion of the current year in which the executive was employed by the Company prior to the Change in Control in the event the AIP or employment agreement is not assumed by the acquiror; and
48
•continued vesting of time-based and performance-based equity awards under the Company’s Omnibus Incentive Plan in the event the Company’s Omnibus Incentive Plan is assumed by the acquiror or accelerated vesting of time-based and performance-based equity awards under the Company’s Omnibus Incentive Plan in the event the Company’s Omnibus Incentive Plan is not assumed by the acquiror (with such acceleration effective as of date of the Change in Control with any applicable performance-based vesting determined in good faith by the Compensation Committee upon such Change in Control, treating the effective date of such Change in Control as the last day of the applicable performance period).
In the event of a Qualifying Separation from Service during the Change in Control Period, and subject to the executive’s execution of a general release of liability in favor of the Company and compliance with the terms of any restrictive covenant agreement for two years following the Qualifying Separation from Service, the Severance Plan provides the following payments and benefits to the executives:
•a severance payment (paid over a 24-month period) calculated as base salary multiplied by two in the case of the Group 1 Executives or a severance payment (paid over a 12-month period) calculated as base salary multiplied by one in the case of the Group 2 Executives;
•payment of any earned but unpaid bonus under the Company’s AIP for the completed prior year if the Qualifying Separation from Service occurs prior to the scheduled date of the payment for such bonus;
•a portion of the executive’s AIP payment for the year in which the Qualifying Separation from Service occurs, determined in accordance with the applicable criteria under the AIP (assuming the “Target” threshold was achieved) and pro-rated for the time in the executive’s role for such year;
•accelerated vesting of time-based and performance-based equity awards under the Company’s Omnibus Incentive Plan (with such acceleration effective as of the date of the Qualifying Separation from Service with any applicable performance-based vesting determined in good faith by the Compensation Committee upon such Change in Control, treating the effective date of such Change in Control as the last day of the applicable performance period); and
•payment of the executive’s COBRA premiums for a period of up to twelve months following the Qualifying Separation from Service.
The above description is a summary of the terms of the Severance Plan and is subject to, and qualified in its entirety by, the terms of the Severance Plan, a copy of which is included in this report as Exhibit 10.1 and incorporated herein by reference.
49
ITEM 6. EXHIBITS
The following exhibits are filed as a part of this Quarterly Report on Form 10-Q:
Cover Page Interactive Data File (formatted in inline XBRL and included in Exhibit 101)
__________
* Filed herewith
** Furnished herewith and as such are deemed not “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall they be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.
50
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
