Sale agreement amount

[Table of Contents](#ic0c31f79a13347b4b84027caf6ad2450_7)

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | Three Months Ended September 30, |  | Nine Months Ended September 30, |
| (in thousands) |  | 2022 |  | 2021 |  | 2022 |  | 2021 |
| Other unallocated (expenses) income:  |  |  |  |  |  |  |  |  |
| Gain on sale of real estate (2) |  | $ | —  |  |  | $ | —  |  |  | $ | 102,803  |  |  | $ | —  |  |
| Gain on insurance proceeds (3) |  | —  |  |  | —  |  |  | 1,507  |  |  | —  |  |
| Product liability damages award (4) |  | —  |  |  | —  |  |  | —  |  |  | (77,421) |  |
| Loss on software disposal (5) |  | —  |  |  | (61,063) |  |  | —  |  |  | (61,063) |  |
| Transaction and other costs (6) |  | (3,462) |  |  | —  |  |  | (56,955) |  |  | —  |  |
| Total other unallocated (expenses) income |  | $ | (3,462) |  |  | $ | (61,063) |  |  | $ | 47,355  |  |  | $ | (138,484) |  |

(2)    Amount reflects a gain on the sale of real estate that had been leased to S.P. Richards. (3)    Amount reflects insurance recoveries in excess of losses incurred on inventory, property, plant and equipment and other fire-related costs.(4)    Amount reflects damages reinstated by the Washington Supreme Court order on July 8, 2021 in connection with a 2017 automotive product liability claim.(5)    Amount reflects a loss on an internally developed software project that was disposed of due to a change in management strategy related to advances in alternative technologies.(6)    Amount primarily reflects costs associated with the January 3, 2022 acquisition and integration of KDG. These costs also include a $17 million impairment charge driven by a decision to retire certain legacy trade names, classified as other intangible assets, prior to the end of their estimated useful lives as part of executing our KDG integration and rebranding strategy. Refer to the acquisition footnote for more information regarding the acquisition.Net sales are disaggregated by geographical region for each of our reportable segments, as we deem this presentation best depicts how the nature, amount, timing and uncertainty of net sales and cash flows are affected by economic factors. The following table presents disaggregated geographical net sales from contracts with customers by reportable segment:

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  | Three Months Ended September 30, |  | Nine Months Ended September 30, |
| (in thousands) |  | 2022 |  | 2021 |  | 2022 |  | 2021 |
| North America: |  |  |  |  |  |  |  |  |
| Automotive |  | $ | 2,333,390  |  |  | $ | 2,100,250  |  |  | $ | 6,766,271  |  |  | $ | 6,039,617  |  |
| Industrial |  | 2,064,569  |  |  | 1,493,618  |  |  | 5,996,299  |  |  | 4,362,792  |  |
| Total North America  |  | $ | 4,397,959  |  |  | $ | 3,593,868  |  |  | $ | 12,762,570  |  |  | $ | 10,402,409  |  |
| Australasia: |  |  |  |  |  |  |  |  |
| Automotive |  | $ | 404,708  |  |  | $ | 374,167  |  |  | $ | 1,182,557  |  |  | $ | 1,130,744  |  |
| Industrial |  | 120,243  |  |  | 120,697  |  |  | 342,447  |  |  | 350,511  |  |
| Total Australasia |  | $ | 524,951  |  |  | $ | 494,864  |  |  | $ | 1,525,004  |  |  | $ | 1,481,255  |  |
| Europe – Automotive |  | $ | 752,364  |  |  | $ | 730,117  |  |  | $ | 2,284,749  |  |  | $ | 2,183,637  |  |
| Total net sales |  | $ | 5,675,274  |  |  | $ | 4,818,849  |  |  | $ | 16,572,323  |  |  | $ | 14,067,301  |  |

3. Accounts Receivable Sales AgreementUnder our accounts receivable sales agreement (the "A/R Sales Agreement"), we continuously sell designated pools of receivables as they are originated by us and certain U.S. subsidiaries to a separate bankruptcy-remote special purpose entity (“SPE”). The A/R Sales Agreement has a three year term, which we intend to renew. We continue to be involved with the receivables transferred by the SPE to the unaffiliated financial institution by providing collection services. As cash is collected on sold receivables, the SPE continuously transfers ownership and control of new qualifying receivables to the unaffiliated financial institution so that the total principal amount outstanding of receivables sold is approximately $1 billion at any point in time (which is the maximum amount allowed under the agreement as amended on January 3, 2022). 11
