Global Payments (GPN) 10-K risk factor changes: FY2021 vs FY2020

If any of the events contemplated by the following discussion of risks should occur, our business, [added: financial condition,] results of [removed: operations, financial condition] [added: operations] and cash flows could suffer significantly.

However, we cannot be certain that these measures will be successful [removed: and] [added: or] will be sufficient to counter all current and emerging technology threats.

Any type of security breach, attack or misuse of data described above or otherwise, whether experienced by us or an associated third party, could harm our reputation and deter existing and prospective customers from using our services or from making [removed: electronic] [added: digital] payments generally, increase our operating expenses in order to contain and remediate the incident, expose us to unanticipated or uninsured liability, disrupt our operations (including potential service interruptions), distract our management, increase our risk of litigation or regulatory scrutiny, result in the imposition of penalties and fines under state, federal and foreign laws or by the card networks, and adversely affect our continued card network registration or membership [added: and financial]

[removed: and financial] institution sponsorship.

Defects in our software services and errors or delays in our processing of [removed: electronic] [added: digital] transactions could result in additional development costs, diversion of technical and other resources from our other development efforts, loss of credibility with current or potential customers, harm to our reputation and exposure to liability claims.

Our systems and operations or those of our third-party providers could be exposed to damage or interruption from, among other things, fire, [added: climate-related events, including extreme weather events,] natural [removed: disaster,] [added: disasters, pandemics,] power loss, telecommunications failure, terrorist acts, war, unauthorized entry, human error, and computer viruses or other defects.

The payments technology industry is highly [removed: competitive,] [added: competitive] and [added: highly innovative, and] some of our competitors [removed: are larger and] have greater financial and operational resources than we do, which may give them an advantage with respect to the pricing of services offered to customers and the ability to develop new [added: and disruptive] technologies.

We operate in the payments technology industry, which is highly [removed: competitive.][added: competitive and highly innovative.]

In this industry, our primary competitors include other independent payment processors, credit card processing firms, [added: third-party card processing software institutions,] as well as financial institutions, ISOs, prepaid programs managers and, potentially, card networks.

Additionally, the market for prepaid cards, demand deposit accounts and alternative financial services is similarly highly [removed: competitive] [added: competitive,] and competition is increasing as more companies endeavor to address the needs of underbanked consumers.

Furthermore, we are facing increasing competition from nontraditional competitors, including new entrant technology [removed: companies] [added: companies,] who offer certain innovations in payment methods.

These competitors may compete in ways that minimize or remove the role of traditional card networks, acquirers, issuers and processors in the [removed: electronic] [added: digital] payments process.

If these nontraditional competitors gain a greater share of total [removed: electronic] [added: digital] payments transactions, it could have a material adverse effect on our business, financial condition, results of operations and cash flows.

In addition, certain of the services we deliver to the payments technology [removed: markets] [added: market] are designed to process very complex transactions and deliver reports and other information on those transactions, all at very high volumes and processing speeds.

The termination of our registrations or our membership or our status as a service provider or a merchant processor, or any changes in card association or other network rules or standards, including interpretation and implementation of the rules or standards, that increase the cost of doing business or limit our ability to provide transaction processing services to our customers, could have a material adverse effect on our business, financial [added: condition, results of operations and cash flows.]

[removed: If a merchant or an ISO customer fails to comply with the applicable] requirements of the card associations and networks, we or the merchant or ISO could be subject to a variety of fines or penalties that may be levied by the card associations or networks.

We experience attrition in merchant credit and debit card processing volume resulting from several factors, including business closures, transfers of [removed: merchants] [added: merchant] accounts to our competitors, unsuccessful contract renewal negotiations and account closures that we initiate for various reasons, such as heightened credit risks or contract breaches by merchants.

[added: We may not be able to successfully identify suitable] acquisition, investment and alliance candidates in the future, and if we do, they may not provide us with the value and benefits we anticipate.

There may be a decline in the use of cards and other [removed: electronic] [added: digital] payments as a payment mechanism for consumers or other adverse developments with respect to the card industry in general.

[removed: If] [added: While the COVID-19 pandemic has accelerated the digitization in payments, if] consumers do not continue to use credit, debit or GPR prepaid debit cards or other [removed: electronic] [added: digital] payment methods of the type we process as a payment mechanism for their transactions or if there is a change in the mix of payments between cash, checks, credit cards and debit or GPR prepaid debit cards, which is adverse to us, it could have a material adverse effect on our business, financial condition, results of operations and cash flows.

The timing of the conversions or deconversions of card [removed: portfolio] [added: portfolios] may also affect our revenues and expenses.

When our long-term contracts [removed: expire,] [added: near expiration,] the [removed: time of] renewal or renegotiation [added: of the contract] presents our customers with the opportunity to consider other providers, transition all or a portion of the services we provide in-house or seek lower rates for our services.

[removed: Due to a variety of] factors, conversions and deconversions may not occur as scheduled and this may have a material adverse effect on our financial position and results of operations.

We have potential liability for fraudulent [removed: electronic] [added: digital] payment transactions or credits initiated by merchants or others, and our prepaid card programs expose us to threats involving the misuse of cards, collusion, fraud and identity theft.

Additionally, [added: the] COVID-19 [added: pandemic, as well as macroeconomic conditions such as rising inflation and increased costs for labor and supplies,] has negatively affected [added: or may continue to affect] the financial viability and operations of certain merchants.

The acquisition, integration, and conversion of businesses and the formation or operation of [removed: alliances, such as the Merger] [added: alliances] or joint ventures and other partnering [removed: arrangements,] [added: arrangements] involve a number of risks.

In addition, international acquisitions and alliances often involve additional or increased risks, including, for example: managing geographically separated organizations, systems, and facilities; integrating personnel with diverse business backgrounds and organizational cultures; complying with foreign regulatory requirements; fluctuations in currency exchange rates; enforcement of intellectual property rights in some foreign countries; difficulty entering new foreign markets due to, [added: among other things, customer acceptance and business knowledge of those new markets; and general economic and political conditions.]

[removed: Our] [added: As a payments technology company, our] business is affected by laws and [added: complex] regulations and examinations that affect us and our industry in the countries in which we operate.

[removed: All persons offering] [added: Because we directly] or [removed: providing] [added: indirectly offer or provide] financial services or products to consumers, [removed: directly or indirectly, can be] [added: we are] subject to prohibitions against unfair, deceptive, or abusive acts or practices under the Dodd-Frank Act.

More generally, all persons engaged in commerce, including, but not limited to, us and our merchant and financial institution customers, are [removed: also] subject to Section 5 of the Federal Trade Commission ("FTC") Act prohibiting unfair or deceptive acts or practices ("UDAP").

[added: We also have businesses that are subject to credit reporting and debt collection laws and regulations in the U.S.] Various federal and state regulatory enforcement agencies, including the FTC, the CFPB and the states’ attorneys [removed: general] [added: general,] have the authority to take action against nonbanks that engage in UDAP or violate other laws, rules or regulations and, to the extent we are in violation of these laws, rules or [added: regulations or processing payments for a merchant that may be in violation of these laws, rules or regulations, we may be subject to enforcement actions and as a result may incur losses and liabilities.]

In addition, we and our sponsor financial institutions are subject to the laws and regulations enforced by OFAC, which prohibit [removed: U.S. persons from engaging in transactions with certain prohibited persons or entities.]

As with other regulatory schemes, our failure to comply could result in public or private enforcement action and accompanying litigation costs, losses, fines and [removed: penalties.][added: penalties, which could adversely affect our business, financial condition, results of operations and cash flows.]

[removed: If our policies and procedures are not fully effective or if we are not always] successful in identifying and mitigating all risks to which we are or may be exposed, we may suffer uninsured liability, harm to our reputation or be subject to litigation or regulatory actions that could have a material adverse effect on our business, financial condition, results of operations and cash flows.

A portion of our [removed: current] indebtedness bears interest at a variable rate, and we may incur additional variable-rate indebtedness in the future.

The [removed: alteration or replacement of] [added: transition away from] the London Interbank Offered Rate ("LIBOR") benchmark interest rate [added: and the adoption of alternative benchmark reference rates] could adversely affect our business, financial condition, results of operations and cash flows.

A portion of our [removed: current] indebtedness bears interest at a variable rate based on [removed: LIBOR, and we may incur additional variable indebtedness based on] LIBOR.

The Alternative Reference Rates Committee has proposed the Secured Overnight Financing Rate ("SOFR") as its recommended alternative to [added: USD] LIBOR, and the Federal Reserve Bank of New York began publishing SOFR rates in April 2018.

[added: Despite our efforts to protect our intellectual] property, third parties may infringe or misappropriate our intellectual property or may develop software or technology that competes with ours.

Our level of debt and the covenants to which we agreed could have negative consequences on us, including, among other things, (1) requiring us to dedicate a large portion of our cash flow from operations to servicing and repayment of the debt; (2) limiting funds available for strategic [removed: initiatives and opportunities, working capital and other general corporate needs, and (3) limiting our ability to incur certain kinds or amounts of additional indebtedness, which could restrict our flexibility to react to changes in our business, our industry and economic conditions.]

There is also a risk that third-party suppliers of hardware and infrastructure required to support our employee productivity or our vendors could be affected by supply chain disruptions, such as manufacturing and shipping delays.

An extended supply chain disruption could also affect the delivery of our services.

Some of our current and potential competitors may be larger than we are and have greater financial and operational resources or brand recognition than we have.

If a merchant or an ISO customer fails to comply with the applicable

Due to a variety of

Certain of our subsidiaries are subject to, among others, privacy, anti-money laundering and debt collection regulations.

U.S. persons from engaging in transactions with certain prohibited persons or entities.

If varying or conflicting regulations come into existence across the jurisdictions in which we operate, we may have difficulty aligning our operations to comply with all applicable laws.

If our policies and procedures are not fully effective or if we are not always

We currently maintain investment credit ratings with nationally recognized statistical rating organizations.

Effective January 1, 2022, the publication of LIBOR on a representative basis ceased for the one-week and two-month USD LIBOR settings and all sterling, yen, euros, and swiss franc LIBOR settings.

All other remaining USD LIBOR settings will cease July 1, 2023.

As described in "Note 1—Basis of Presentation and Summary of Significant Accounting Policies" in the notes to the accompanying consolidated financial statements, to facilitate an orderly transition from LIBOR to alternative benchmark rates, the Company established an initiative led by internal subject matter experts to assess and mitigate risks associated with the discontinuance of LIBOR.

In connection with the sunset of certain LIBOR reference rates occurring at the end of 2021, we amended the Unsecured Revolving Credit Agreement in December 2021 to replace LIBOR as administered by the ICE Benchmark Administration with the Sterling Overnight Index Average Reference Rate and the Euro Interbank Offered Rate for

any extension of credit denominated in sterling or euros, respectively.

We continue to monitor developments related to the upcoming transition from USD LIBOR to an alternative benchmark reference rate after June 30, 2023.

At this time, the effects of the phase out of USD LIBOR and the adoption of alternative benchmark rates have not been fully determined.

A failure to properly transition away from USD LIBOR could adversely affect the Company’s borrowing costs or expose the Company to various financial, operational and regulatory risks, which could affect the Company’s results of operations and cash flows.

initiatives and opportunities, working capital and other general corporate needs, and (3) limiting our ability to incur certain kinds or amounts of additional indebtedness, which could restrict our flexibility to react to changes in our business, our industry and economic conditions.

While we have seen and continue to see signs of economic recovery, which has positively affected our financial results in 2021 compared to the prior year, the rate of recovery on a global basis has been and may continue to be affected by additional developments related to COVID-19.

- Workforce effects, such as difficulty recruiting, retaining, training, motivating and developing employees due to evolving health and safety requirements and protocols, changing worker expectations and talent marketplace variability regarding flexible work models.

which could adversely affect our operations.

Climate-related events, including extreme weather events and natural disasters and their effect on critical infrastructure in the U.S. or internationally, could have similar adverse effects on our operations, customers or third-party suppliers.

Furthermore, shareholders, customers and other stakeholders have begun to consider how corporations are addressing ESG issues.

Government regulators, investors, customers and the general public are increasingly focused on ESG practices and disclosures, and views about ESG are diverse and rapidly changing.

These shifts in investing priorities may result in adverse effects on the trading price of the Company's common stock if investors determine that the Company has not made sufficient progress on ESG matters.

We could also face potential negative ESG-related publicity in traditional media or social media if shareholders or other stakeholders determine that we have not adequately considered or addressed ESG matters.

We have been the recipient of proposals from shareholders to promote their governance positions.

Such proposals may not be in the long-term interests of the Company or our stockholders and may divert management’s attention away from operational matters or create the impression that our practices are inadequate.

Shareholders are increasingly submitting proposals related to a variety of ESG issues to public companies, and we may receive other such proposals in the future.

The U.K.'s withdrawal from the European Union could have an adverse effect on our business and financial results.

In January 2020, the U.K. formally withdrew from the EU in an action commonly known as Brexit.

It remains possible that the level of economic activity in this region will be adversely affected by Brexit and that there will be increased regulatory and legal complexities, including those relating to tax, trade, data transfers, security and employees.

Such changes could be costly and potentially disruptive to our operations and business relationships in these markets.

Economic uncertainty related to Brexit, including volatility in global stock markets and currency exchange rates, could adversely affect our business.

Failure to retain, develop or attract key personnel, to meet our goals related to fostering an inclusive and diverse culture, including increasing the proportion of our workforce in the U.S. that is composed of women and minorities, or to design and successfully implement flexible work models that meet the expectations of employees and prospective employees, could disrupt our operations and adversely affect our business and future success.

We compete with many larger companies that have greater financial and operational resources than we have.

condition, results of operations and cash flows.

We may not be able to successfully identify suitable

among other things, customer acceptance and business knowledge of those new markets; and general economic and political conditions.

In addition, there are other laws, rules and or regulations, including the Telemarketing Sales Act, that may directly affect us or the activities of our merchant customers and in some cases may subject us to investigations, fees, fines and disgorgement of funds in the event we are deemed to have aided and abetted or otherwise provided the means and instrumentalities to facilitate the illegal activities of the merchant through our payment processing services.

regulations or processing payments for a merchant that may be in violation of these laws, rules or regulations, we may be subject to enforcement actions and as a result may incur losses and liabilities.

In many countries, we are legally or contractually required to comply with the anti-money laundering laws and regulations, such as, in the United States, the Bank Secrecy Act and similar laws of other countries, which require that customer identifying information be obtained and verified.

In some countries, we are directly subject to these requirements; in other countries, we have contractually agreed to assist our financial institution customers with their obligation to comply with anti-money laundering requirements that apply to them.

Our failure to comply with any of these contractual requirements or laws could adversely affect our business, financial credit results of operations and cash flows.

We are also subject to a variety of foreign and domestic laws, and their implementing regulations, which establish requirements for the collection, processing, storage, use and disclosure of personal information, require notice to individuals of privacy practices, and provide individuals with certain rights to prevent use and disclosure of protected information.

For example, we are subject to applicable privacy and information security regulations in the regions where we operate; the Payment Services Directive in Europe; the E.U. General Data Protection Regulation; The Code of Conduct for the Credit and Debit Card Industry in Canada (issued by Canada's Department of Finance); the California Consumer Protection Act; the Housing Assistance Tax Act of 2008 in the United States; HIPAA and other health privacy regulations and a myriad of U.S. federal and state consumer protection laws and state escheat regulations.

In addition, the U.K. Payment Systems Regulator has increased its oversight of the card acquiring industry.

Portions of our business may be subject to the FDCPA, the FCRA and similar state laws.

These debt collection laws are designed to eliminate abusive, deceptive and unfair debt collection practices and may require licensing at the state level.

If we fail to comply with any of these laws, to the extent they are applicable to us, we may be subject to fines, penalties and litigation.

We currently maintain investment credit ratings with Moody's Investors Service and Standard & Poor's Ratings Services.

In July 2017, the United Kingdom’s Financial Conduct Authority ("FCA"), a regulator of financial services firms and financial markets in the United Kingdom, stated that they will plan for a phase out of regulatory oversight of LIBOR interest rates indices.

The FCA has indicated they will support the LIBOR indices through 2021, to allow for an orderly transition to an alternative reference rate.

It is possible that the ICE Benchmark Administration Limited (formerly NYSE Euronext Rate Administration Limited) and the panel banks which contribute to LIBOR could continue to produce LIBOR on the current basis after 2021.

The ICE Benchmark Administration Limited recently announced that it will consult on its intention to extend the publication of most tenors LIBOR to June 30, 2023.

At this time, it is not possible to predict when LIBOR will be replaced as the reference rate in the agreements governing the Company’s indebtedness and hedging agreements or the effect any discontinuance, modification or other reforms to LIBOR, or the establishment of alternative reference rates such as SOFR, or any other reference rate, will have on the Company.

However, if LIBOR ceases to exist or if the methods of calculating LIBOR change from their current form, the Company’s borrowing costs may be adversely affected.

Despite our efforts to protect our intellectual

While we expect the COVID-19 pandemic will continue to have an adverse effect on our revenues and earnings in 2021, we do expect a steady and progressive economic recovery throughout the year.

Additionally, COVID-19 could require new or modified processes, procedures and controls to respond to changes in our business environment.

Any of these developments may remain prevalent for a significant period of time and may continue to adversely affect our business, results of operations, financial condition and cash flows even after the COVID-19 pandemic has subsided.

Accordingly, the ultimate effects on our operations, financial condition and cash flows cannot be determined at this time.

become more selective in their card issuance practices.

On January 31, 2020, the United Kingdom ceased to be a member state of the European Union ("Brexit"), with a transition period that ended on December 31, 2020.

During the transition period, existing arrangements between the U.K. and the E.U. remained in place.

Following the transition period, the U.K. is no longer a part of the E.U. single market.

In December 2020, the U.K and E.U. announced they had entered into a post-Brexit deal on certain aspects of trade and other strategic and political issues.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with "Item [removed: 6 - Selected Financial Data" and "Item] 8 - Financial Statements and Supplementary Data." This discussion and analysis contains forward-looking statements about our plans and expectations of what may happen in the future.

Discussions of our results of operations for the year ended December 31, [removed: 2019] [added: 2020] compared to the year ended December 31, [removed: 2018] [added: 2019] that have been omitted under this item can be found in "Part II, Item 7 - Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Form 10-K for the year ended December 31, [removed: 2019,] [added: 2020,] which was filed with the United States Securities and Exchange Commission on February [removed: 21, 2020.][added: 19, 2021.]

We are a leading [removed: pure play] payments technology company delivering innovative software and services to our customers globally.

Our technologies, services and [removed: employee] [added: team member] expertise [removed: enable] [added: allow] us to provide a broad range of solutions that [removed: allow] [added: enable] our customers to operate their businesses more efficiently across a variety of channels around the world.

Consolidated operating results for the [removed: year] [added: years] ended December 31, 2020 [added: and 2021 each] reflect a full year of the acquired operations of TSYS, while [added: consolidated operating results for] the [removed: prior] year [removed: includes] [added: ended December 31, 2019 include] the acquired operations of TSYS only from the acquisition date through December 31, 2019.

We [added: also] continue to [removed: focus] [added: execute] on merger and integration activities, [added: primarily related to the Merger,] such as combining business operations, [removed: aligning go-to-market strategies,] streamlining technology infrastructure, eliminating duplicative corporate and operational support structures and realizing scale efficiencies.

[removed: We also continue to invest in] [added: These investments include] software and hardware to support the development of new technologies, infrastructure to support our growing business and [added: the] continued consolidation and enhancement of our operating platforms.

[removed: During 2020 and continuing into 2021,] [added: Since early 2020,] the global economy has [removed: been, and continues to be,] [added: been] affected by [removed: COVID-19.][added: the COVID-19 pandemic.]

The pandemic has caused and may continue to cause significant disruptions to businesses and markets worldwide [removed: as] [added: through] the [removed: virus continues to] [added: continued] spread [removed: or has] [added: of the virus, including through] a resurgence [added: of COVID-19 cases or emergence of new more contagious or vaccine-resistant virus variants] in certain jurisdictions.

We saw improvement in our financial results [removed: and positive trends] during the latter half of 2020 [added: and in 2021] as certain [removed: state and local] governments [removed: in the United States and abroad] began to gradually ease [removed: restrictions, certain businesses reopened and spending increased.][added: pandemic-related restrictions.]

[removed: We also implemented cost-saving actions, such as reductions in employee] [added: Employee] compensation costs [removed: and discretionary spending,] [added: were lower in the prior year as a result of certain temporary cost-saving actions taken] to help mitigate the financial effects of the COVID-19 pandemic.

We continue to closely monitor the [removed: evolving effects of the] COVID-19 pandemic; however, the implications on future global economic conditions and related effects on our business and financial condition are difficult to predict due to [added: continuing] uncertainties around the ultimate severity, scope and duration of the pandemic, [removed: the availability] [added: vaccine administration rates] and [removed: effectiveness] [added: efficacy, resurgence] of [removed: treatments] [added: COVID-19 cases and emergence of new more contagious] or [removed: vaccines] [added: vaccine-resistant virus variants] and the direction or extent of current or future restrictive actions that may be imposed by governments or public health authorities.

The proliferation of credit and debit cards, as well as other digital payment solutions, has made the acceptance of [removed: electronic] [added: digital] payments a virtual necessity for many businesses, regardless of size, in order to remain competitive.

Further, the expanding digitization of the economy and availability and access to financial services increases the demand for cards and [removed: electronic payments,] [added: digital payment solutions,] which in turn drives growth in acceptance and transaction volumes.

[removed: However, the outbreak has also accelerated the] [added: The] use of [removed: electronic payments,] [added: digital payment solutions,] the need for development of technologies and [removed: electronic-based] [added: digital-based] solutions and expansion of ecommerce, omnichannel and contactless payment [removed: solutions.][added: solutions has accelerated, in part as a result of the COVID-19 pandemic.]

We believe that the number of [removed: electronic] [added: digital] payment transactions will continue to grow and that an increasing percentage of these will be facilitated through emerging technologies.

As a result, we expect an increasing portion of our future capital investment will be allocated to support the development of new and emerging [removed: technologies.][added: technologies, including technology modernization, innovation and integration through strategic partnerships.]

We also believe new markets will continue to develop [added: and expand] in areas that have been previously dominated by paper-based transactions.

We expect industries such as education, government and healthcare, as well as recurring payments and [removed: business-to-business] [added: B2B] payments, to continue to see transactions migrate to [removed: electronic-based] [added: digital-based] solutions.

We anticipate that the continued development of new services and [added: technologies,] the emergence of new vertical markets [added: and continued expansion of technology-enabled ecommerce and omnichannel solutions, including expanded scale and market reach through new innovative cloud-based capabilities and strategic partnerships,] will be a factor in the growth of our business and our revenue in the future.

*Merchant Solutions.* The majority of our Merchant Solutions segment revenues is generated by services priced as a percentage of transaction value or a specified fee per transaction, depending on card type or [removed: the] [added: industry] vertical.

We provide payment technology and software solutions to customers and fund settlement either directly, in markets where we have direct membership with the payment networks, or through our relationship with a member financial institution in [added: markets where we are sponsored.]

We market our services through a variety of relationship-led and [removed: technology enabled] [added: technology-enabled] distribution channels, including a direct sales force, trade associations, agent and enterprise software providers and referral arrangements with value-added resellers ("VARs").

[removed: As a result of the Merger, we] [added: We] have equity method investments, including a 45% [removed: investment] [added: interest] in China UnionPay Data Co., Ltd., which we account for using the equity method of accounting.

Year Ended December 31, [removed: 2020] [added: 2021] Compared to Year Ended December 31, [removed: 2019][added: 2020]

The following table sets forth key selected financial data for the years ended December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] this data as a percentage of total revenues, and the changes between periods in dollars and as a percentage of the prior-period amount.

The income statement data for the years ended December 31, [removed: 2020] [added: 2021] and [removed: 2019] [added: 2020] are derived from the accompanying consolidated financial statements included in "Item 8 - Financial Statements and Supplementary Data."

| (dollar amounts in thousands) | | | [removed: 2020] [added: 2021] | | | | | | % of Revenue(1) | | | | | | [removed: 2019] [added: 2020] | | | | | | % of Revenue(1) | | | | | | Change | | | | | | % Change | | |

| Business and Consumer Solutions | | | [removed: 829,505] [added: 886,443] | | | | | | [removed: 11.2] [added: 10.4] | | % | | | | [removed: 227,440] [added: 829,505] | | | | | | [removed: 4.6] [added: 11.2] | | % | | | | [removed: 602,065] [added: 56,938] | | | | | | [removed: NM] [added: 6.9] | | [added: %] |

| Business and Consumer Solutions | | | [removed: 138,630] [added: 167,777] | | | | | | [removed: 1.9] [added: 2.0] | | % | | | | [removed: 19,473] [added: 138,630] | | | | | | [removed: 0.4] [added: 1.9] | | % | | | | [removed: 119,157] [added: 29,147] | | | | | | [removed: NM] [added: 21.0] | | [added: %] |

| Merchant Solutions | | | [removed: 24.8] [added: 30.5] | | % | | | | | | | | | | [removed: 28.0] [added: 24.8] | | % | | | | | | | | | | [removed: (3.2)] [added: 5.7] | | % | | | | | | |

| Issuer Solutions | | | [removed: 14.0] [added: 14.6] | | % | | | | | | | | | | [removed: 13.6] [added: 14.0] | | % | | | | | | | | | | [removed: 0.4] [added: 0.6] | | % | | | | | | |

| Business and Consumer Solutions | | | [removed: 16.7] [added: 18.9] | | % | | | | | | | | | | [removed: 8.6] [added: 16.7] | | % | | | | | | | | | | [removed: 8.1] [added: 2.2] | | % | | | | | | |

(3) [removed: During the years ended December 31, 2020 and 2019, operating income] [added: Operating loss] for [removed: our Merchant Solutions segment reflected the effect of] [added: Corporate included] acquisition and integration expenses of [removed: $7.0] [added: $335.5] million and [removed: $56.1 million.][added: $313.0 million during the years ended December 31, 2021 and 2020, respectively.]

[added: -] Consolidated revenues for the year ended December 31, [removed: 2020] [added: 2021] increased [removed: by 51.1%] to [removed: $7,423.6] [added: $8,523.8] million, compared to [removed: $4,911.9] [added: $7,423.6] million for the prior [removed: year, primarily due to additional revenues from the acquired operations of TSYS.][added: year.]

[removed: Revenues from the acquired operations of TSYS were $4,205.2 million] [added: Consolidated revenues] for the year ended December 31, [removed: 2020,] [added: 2021 increased by 14.8% to $8,523.8 million,] compared to [removed: $1,215.0] [added: $7,423.6] million for the prior year.

*Merchant Solutions Segment.* Revenues from our Merchant Solutions segment [added: for the year ended December 31, 2021] increased [added: by 20.8%] to [removed: $4,688.3] [added: $5,665.6] million, compared [added: to $4,688.3 million for the prior year.]

Starting in [removed: mid-March,] [added: mid-March 2020,] COVID-19 [removed: had] [added: began to have] an unfavorable effect on our revenues as a result of a reduction in [removed: spending and] transaction volumes and [removed: closures of] [added: restrictions on] certain of our customer businesses throughout North America, Europe and Asia Pacific.

We saw improvement in our financial results during the latter half of 2020 [removed: as state] and [removed: local governments] in [removed: the United States and] [added: 2021 as certain] governments [removed: abroad began to gradually ease] [added: eased] pandemic-related restrictions and [added: consumer and business] spending increased.

*Issuer Solutions Segment.* Revenues from our Issuer Solutions segment for the year ended December 31, [removed: 2020 was $1,981.4] [added: 2021 increased by 4.3% to $2,066.0] million, compared to [removed: $604.7] [added: $1,981.4] million for the prior [removed: year, primarily reflecting revenues from the acquired operations of TSYS.][added: year.]

We have grown organically as well as through acquisitions.

These investments include new product development and innovation to further enhance and differentiate our suite of technology and cloud-based solutions available to customers, along with migration of certain underlying technology platforms to cloud environments to enhance performance and drive cost efficiencies.

Highlights related to our financial condition at December 31, 2021 and results of operations for the year then ended include the following:

The increase in consolidated revenues is primarily due to an increase in transaction volumes from continued economic recovery as COVID-19 restrictions eased and acceleration in the use of digital payment solutions.

The increase in consolidated operating income and operating margin for the year ended December 31, 2021 is primarily due to the increase in revenues and favorable effects of Merger-related cost synergies.

- We expanded our business through the execution of several strategic acquisitions.

◦On June 10, 2021, we acquired Zego, a real estate technology company that provides a comprehensive resident experience management software and digital commerce solutions to property managers, primarily in the United States, for cash consideration of approximately $933 million.

This acquisition aligns with our technology-enabled, software driven strategy and expands our business into a new vertical market.

◦During the year ended December 31, 2021, we completed other strategic business acquisitions for an aggregate purchase price of approximately $963 million.

Our acquisition of MineralTree, a leading provider of accounts payable automation and B2B payments solutions, expands our target addressable market and provides incremental avenues for growth in one of the most attractive technology markets.

Our acquisitions of the Bankia merchant services business and Worldline's PayOne Austrian acquiring business deepen our presence in Europe and expand the scale of our distribution and technologies.

- Our capital allocation priorities were supported by the successful issuance of new senior unsecured notes.

◦On November 22, 2021, we issued $2.0 billion aggregate principal amount of senior unsecured notes consisting of the following: (i) $500.0 million aggregate principal amount of 1.500% senior notes due November 2024; (ii) $750.0 million aggregate principal amount of 2.150% senior notes due January 2027; and (iii) $750.0 million aggregate principal amount of 2.900% senior notes due November 2031.

◦On February 26, 2021, we issued $1.1 billion aggregate principal amount of 1.200% senior unsecured notes due March 2026.

We used the net proceeds from the offering to fund the redemption in full of the 3.800% senior unsecured notes due April 2021, to repay a portion of the outstanding indebtedness under our revolving credit facility and for general corporate purposes.

*COVID-19 Update*

Beginning in mid-March 2020, our financial results were affected by decreased spending and transaction volumes, as governments implemented measures in an effort to contain the virus, including lockdowns, physical distancing, travel restrictions, limitations on public gatherings, work from home and restrictions on nonessential businesses.

We saw improvement in our financial results during the latter half of 2020 and in 2021, driven by an increase in spending and transaction volumes as a result of an ease in restrictions and distribution of economic stimulus provided by certain governments and continued vaccine distribution.

While we continue to see signs of economic recovery, which has positively affected our financial results in 2021 compared to the prior year, the rate of recovery on a global basis has been and may continue to be affected by additional developments related to COVID-19.

At the onset of the pandemic, we took early actions to preserve our available capital and provide financial flexibility in response to the effects of COVID-19 on our business, including the temporary reduction of certain operating expenses, employee compensation costs, other discretionary spending and planned capital expenditures, adding to the strength of our financial profile.

Certain operating expenses, capital expenditures and other investments in the business have recently returned to more normalized levels.

We expect to continue to make significant capital investments in the business while also continuing to manage other discretionary spending.

Additionally, revenues include fees from B2B payment services and software-as-a-service (“SaaS”) offerings that automate key procurement processes and enable virtual cards and integrated payments options.

We have recently commenced a strategic evaluation of the consumer portion of this segment with the intent to focus on our growing B2B portfolio.

| Merchant Solutions | | | $ | 5,665,557 | | | | | 66.5 | | % | | | | $ | 4,688,335 | | | | | 63.2 | | % | | | | $ | 977,222 | | | | | 20.8 | | % |

| Issuer Solutions | | | 2,065,971 | | | | | | 24.2 | | % | | | | 1,981,435 | | | | | | 26.7 | | % | | | | 84,536 | | | | | | 4.3 | | % |

| Intersegment eliminations | | | (94,209) | | | | | | (1.1) | | % | | | | (75,717) | | | | | | (1.0) | | % | | | | (18,492) | | | | | | 24.4 | | % |

| Consolidated revenues | | | $ | 8,523,762 | | | | | 100.0 | | % | | | | $ | 7,423,558 | | | | | 100.0 | | % | | | | $ | 1,100,204 | | | | | 14.8 | | % |

| Cost of service | | | $ | 3,773,725 | | | | | 44.3 | | % | | | | $ | 3,650,727 | | | | | 49.2 | | % | | | | $ | 122,998 | | | | | 3.4 | | % |

| Selling, general and administrative | | | 3,391,161 | | | | | | 39.8 | | % | | | | 2,878,878 | | | | | | 38.8 | | % | | | | 512,283 | | | | | | 17.8 | | % |

| Operating expenses | | | $ | 7,164,886 | | | | | 84.1 | | % | | | | $ | 6,529,605 | | | | | 88.0 | | % | | | | $ | 635,281 | | | | | 9.7 | | % |

| Merchant Solutions | | | $ | 1,725,990 | | | | | 20.2 | | % | | | | $ | 1,162,741 | | | | | 15.7 | | % | | | | $ | 563,249 | | | | | 48.4 | | % |

| Issuer Solutions | | | 301,119 | | | | | | 3.5 | | % | | | | 277,651 | | | | | | 3.7 | | % | | | | 23,468 | | | | | | 8.5 | | % |

| Corporate | | | (836,010) | | | | | | (9.8) | | % | | | | (685,069) | | | | | | (9.2) | | % | | | | (150,941) | | | | | | 22.0 | | % |

| Operating income | | | $ | 1,358,876 | | | | | 15.9 | | % | | | | $ | 893,953 | | | | | 12.0 | | % | | | | $ | 464,923 | | | | | 52.0 | | % |

During the year ended December 31, 2021, operating loss for Corporate also included $56.8 million of other charges related to facilities exit activities in response to the transition to remote and flexible work arrangements.

Starting in mid-March 2020, COVID-19 began to have an unfavorable effect on transaction volumes and on our revenues.

We saw improvements during the latter half of 2020 and in 2021, and revenues for the year ended December 31, 2021 increased compared to the prior year primarily due to an increase in transaction volumes from continued economic recovery as COVID-19 restrictions eased and acceleration in the use of digital payment solutions.

While we continue to see signs of economic recovery, which has positively affected our financial results in 2021 compared to the prior year, the rate of recovery on a global basis has been and may continue to be affected by additional developments related to COVID-19.

Revenues for the year ended December 31, 2021 increased compared to the prior year due to an increase in transaction volumes from continued economic recovery as COVID-19 restrictions eased and acceleration in the use of digital payment solutions.

Prior to the Merger, TSYS was a leading global payments provider, offering seamless, secure and innovative solutions to issuers, merchants and consumers.

*Effects of COVID-19 on Our Business*

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

The pandemic and measures to prevent its spread affected our financial results during 2020.

As governments took actions to encourage social distancing and implement shelter-in-place directives, spending and transaction volumes decreased beginning in mid-March 2020.

While we continue to see signs of economic recovery, the

rate of recovery has been affected by the recent reinstatement of restrictions in certain jurisdictions both in the United States and internationally due to a resurgence of the virus.

We have taken a number of actions to preserve our available capital and provide financial flexibility in response to the effects of COVID-19 on our business, including temporarily suspending our share repurchase program during the second and third quarters of 2020 and reducing our planned capital investments in the business.

While we expect the COVID-19 pandemic will continue to have an adverse effect on our revenues and earnings in 2021, we do expect a steady and progressive recovery throughout the year.

The outbreak of the COVID-19 virus in 2020 introduced numerous economic and operational challenges for many industries and businesses.

markets where we are sponsored.

| Merchant Solutions | | | $ | 4,688,335 | | | | | 63.2 | | % | | | | $ | 4,098,580 | | | | | 83.4 | | % | | | | $ | 589,755 | | | | | 14.4 | | % |

| Issuer Solutions | | | 1,981,435 | | | | | | 26.7 | | % | | | | 604,654 | | | | | | 12.3 | | % | | | | 1,376,781 | | | | | | NM | | |

| Intersegment eliminations | | | (75,717) | | | | | | (1.0) | | % | | | | (18,782) | | | | | | (0.4) | | % | | | | (56,935) | | | | | | NM | | |

| Consolidated revenues | | | $ | 7,423,558 | | | | | 100.0 | | % | | | | $ | 4,911,892 | | | | | 100.0 | | % | | | | $ | 2,511,666 | | | | | 51.1 | | % |

| Cost of service | | | $ | 3,650,727 | | | | | 49.2 | | % | | | | $ | 2,073,803 | | | | | 42.2 | | % | | | | $ | 1,576,924 | | | | | 76.0 | | % |

| Selling, general and administrative | | | 2,878,878 | | | | | | 38.8 | | % | | | | 2,046,672 | | | | | | 41.7 | | % | | | | 832,206 | | | | | | 40.7 | | % |

| Operating expenses | | | $ | 6,529,605 | | | | | 88.0 | | % | | | | $ | 4,120,475 | | | | | 83.9 | | % | | | | $ | 2,409,130 | | | | | 58.5 | | % |

| Merchant Solutions | | | $ | 1,162,741 | | | | | 15.7 | | % | | | | $ | 1,148,975 | | | | | 23.4 | | % | | | | $ | 13,766 | | | | | 1.2 | | % |

| Issuer Solutions | | | 277,651 | | | | | | 3.7 | | % | | | | 82,172 | | | | | | 1.7 | | % | | | | 195,479 | | | | | | NM | | |

| Corporate | | | (685,069) | | | | | | (9.2) | | % | | | | (459,203) | | | | | | (9.3) | | % | | | | (225,866) | | | | | | 49.2 | | % |

| Operating income | | | $ | 893,953 | | | | | 12.0 | | % | | | | $ | 791,417 | | | | | 16.1 | | % | | | | $ | 102,536 | | | | | 13.0 | | % |

NM = Not meaningful.

For further discussion, see "Note 2—Acquisitions" in the notes to the accompanying consolidated financial statements.

Operating loss for Corporate included acquisition and integration expenses of $313.0 million and $199.5 million during the years ended December 31, 2020 and 2019, respectively.

Acquisition and integration expenses were primarily related to the Merger.

Starting in mid-March 2020, COVID-19 had an unfavorable effect on our revenues; however, we saw improvements throughout the latter half of 2020.

to $4,098.6 million for the prior year, primarily due to additional revenues from the acquired operations of TSYS.

While we continue to see signs of economic recovery, the rate of recovery has been affected by the reinstatement of restrictions in certain jurisdictions due to a resurgence of the virus during the fourth quarter.

We saw improvement in our financial results during the latter half of 2020 as state and local governments in the United States and governments abroad began to gradually ease pandemic-related restrictions.

Our Business and Consumer Solutions segment experienced an unfavorable effect on revenues starting in mid-March due to reduced consumer spending as a result of COVID-19; however, these declines were mitigated by revenues from our customers loading individual stimulus payments and federal supplementary unemployment insurance distributions resulting from the Coronavirus Aid, Relief and Economic Security Act in the second and third quarters.

Additional stimulus payment distributions in 2021 to provide relief from the effect of the COVID-19 pandemic could have a positive effect on our revenues; however, the ultimate timing and magnitude is difficult to predict.

The year ended December 31, 2019 also reflects integration expenses of $41.8 million.

Additionally, selling, general and administrative expenses included acquisition and integration expenses of $319.5 million, compared to $213.8 million for the prior year.

*Corporate.* Corporate expenses increased by $225.9 million to $685.1 million for the year ended December 31, 2020, compared to $459.2 million for the prior year, primarily due to additional expenses associated with the acquired operations of TSYS and an increase in acquisition and integration expenses primarily due to the Merger.

During the years ended December 31, 2020 and 2019, Corporate expenses included acquisition and integration expenses of $313.0 million and $199.5 million, respectively.

In addition, during the year ended December 31, 2019, we wrote-off capitalized software and other assets of $40.2 million for legacy Global Payments technology that will no longer be utilized for the combined company.

We expect to incur additional charges as Merger-related integration activities continue in 2021.

*Merchant Solutions Segment*.

Operating income in our Merchant Solutions segment was $1,162.7 million for the year ended December 31, 2020, compared to $1,149.0 million for the prior year.

For the year ended December 31, [removed: 2020,] [added: 2021,] currency exchange rate fluctuations [removed: reduced] [added: increased] our consolidated revenues by approximately [removed: $4.9] [added: $90.7] million and [removed: reduced] [added: increased] our operating income by approximately [removed: $0.5] [added: $38.5] million compared to the prior year, calculated by converting revenues and operating income, respectively, for the current year, excluding revenues and operating income from current year acquisitions, in local currencies using exchange rates for the prior year.

For the year ended December 31, [removed: 2020,] [added: 2021,] our transaction gains and losses were insignificant.

As of December 31, [removed: 2020,] [added: 2021,] the amount outstanding under these variable-rate debt arrangements and settlement lines of credit was [removed: $2.4] [added: $2.5] billion.

The interest earned on our invested cash and the interest paid on [added: a portion of] our debt are based on variable interest rates; therefore, the exposure of our net income to a change in interest rates is partially mitigated as an increase in rates would increase both interest income and interest expense, and a reduction in rates would decrease both interest income and interest expense.

Based on balances outstanding under variable-rate debt agreements and invested cash balances at December 31, [removed: 2020,] [added: 2021,] a hypothetical increase of 50 basis points in applicable interest rates as of December 31, [removed: 2020] [added: 2021] would increase our annual interest expense by approximately [removed: $3.8] [added: $5.6] million and increase our annual interest income by approximately [removed: $1.9] [added: $1.5] million.

A portion of our indebtedness bears interest at a variable rate based on the USD London Interbank Offered Rate ("LIBOR").

Furthermore, we have entered into hedging instruments to manage our exposure to fluctuations in the USD LIBOR benchmark interest rate.

To facilitate an orderly transition from USD LIBOR to alternative benchmark rates, the Company established an initiative led by internal subject matter experts to assess and mitigate risks associated with the discontinuance of USD LIBOR.

We continue to monitor developments related to the anticipated transition from USD LIBOR to an alternative benchmark reference rate and evaluate the related risks in connection with transitioning contracts to a new alternative rate, which primarily include loan interest payments and amounts received and paid on interest rate swaps.

Additionally, we maintain contact with our lenders and other stakeholders to evaluate the potential effects of these changes on any future financing activities.

While we currently expect certain USD LIBOR benchmark rates to be available until June 30, 2023, it is possible that USD LIBOR will become unavailable prior to that time.

This could result, for example, if sufficient banks decline to make submissions to the LIBOR administrator.

In that case, the risks associated with the transition to an alternative reference rate will be accelerated.

We are a leading [removed: pure play] payments technology company [removed: providing cutting edge payments and] [added: delivering innovative] software [removed: solutions] [added: and services] to approximately [removed: 3.5] [added: 4.0] million merchant locations and more than [removed: 1,300] [added: 1,350] financial institutions across more than [removed: 100] [added: 170] countries throughout North America, Europe, Asia-Pacific and Latin America.

Our technologies, services and [removed: employee] [added: team member] expertise [removed: enable] [added: allow] us to provide a broad range of solutions that [removed: allow] [added: enable] our customers to operate their businesses more efficiently across a variety of channels around the world.

Headquartered in Georgia with approximately [removed: 24,000 employees] [added: 25,000 team members] worldwide, Global Payments is a [added: Fortune 500 company and is a] member of the S&P 500.

See "Note 2—Acquisitions" in the notes to the accompanying consolidated financial statements for further discussion of [removed: the Merger.][added: these acquisitions.]

The industry continues to grow as a result of wider merchant acceptance and increased use of credit and debit cards, advances in payment [added: solutions and] processing technology and migration to ecommerce, omnichannel and contactless payment solutions.

The proliferation of credit and debit cards, as well as other digital payment solutions, has made the acceptance of [removed: electronic] [added: digital] payments a necessity for many businesses, regardless of size, in order to remain competitive.

The [removed: outbreak of the] COVID-19 [removed: virus in 2020] [added: pandemic] has further accelerated the use of [removed: electronic] [added: digital] payments, the need for development of technologies and [removed: electronic-based] [added: digital-based] solutions and expansion of ecommerce, omnichannel and contactless payment solutions.

We seek to leverage the adoption of, and transition to, [removed: card, electronic] [added: card] and digital-based payments by expanding our share in our existing markets through our distribution channels and service innovation, as well as through acquisitions to improve our offerings and scale.

- [removed: Continue to scale] [added: Further scaling] the [removed: three] [added: four] pillars of our strategy: software-driven focus, [added: ecommerce &] omnichannel [removed: expansion and] [added: solutions,] exposure to faster growth [removed: markets;][added: markets and business-to-business ("B2B") payments;]

We believe our robust technology solutions will continue to differentiate us in the marketplace and [removed: will] position us for continued growth.

Our payment technology solutions are similar around the world in that we enable our customers to accept card, [removed: electronic,] check and digital-based payments.

Our comprehensive offerings include, but are not limited to, [removed: authorization services,] [added: authorization,] settlement and funding services, customer [removed: support and help-desk functions,] [added: support,] chargeback resolution, terminal rental, sales and deployment, payment security services, consolidated billing and [removed: statements and on-line] reporting.

We also provide a variety of value-added [added: solutions and] services, including specialty point-of-sale [removed: solutions,] [added: software,] analytic and customer [removed: engagement tools, payroll and] [added: engagement,] human capital management [removed: services] and [added: payroll and] reporting that assist our customers with driving demand and operating their businesses more efficiently.

We distribute our Merchant Solutions services globally through multiple [removed: relationship-led and] technology-enabled [added: and relationship-led] distribution channels and target customers in many vertical markets located throughout North America, Europe, Asia-Pacific and Latin [added: America.]

In the Merchant Solutions segment, we actively market and provide our payment services, enterprise software solutions and other value-added services directly to our customers through a variety of [removed: relationship-led and] technology-enabled [added: and relationship-led] distribution channels.

[added: *Relationship-Led.*] Through our relationship-led direct sales force worldwide, as well as bank and other referral partnerships, we offer our payments technology services, software and other value-added solutions directly to customers across numerous verticals in the markets we serve.

We offer high-touch services that provide our customers with reliable and secure solutions coupled with [removed: high quality] [added: high-quality] and responsive support services.

Although our primary focus is on building [removed: high quality] [added: high-quality,] direct relationships with merchants, we also provide our services to merchants through independent sales organizations ("ISOs") and financial institutions.

[added: *Technology-Enabled.*] Many of our payment solutions are technology-enabled in that they incorporate or are incorporated into innovative, technology-driven solutions, including enterprise software solutions, designed to enable merchants to better manage their businesses.

[removed: *Global Payments Integrated] [added: *Integrated] Solutions.* Our integrated solutions provide advanced payments technology that is deeply embedded into business management software solutions owned by our technology partners who operate in numerous vertical markets, primarily in North America.

Through AdvancedMD, we provide cloud-based enterprise solutions to small-to-medium sized ambulatory [added: care] physician practices in the United States.

These solutions include credit and debit card cash advance, cashless advance, iGaming solutions, traditional and [removed: electronic] [added: digital] check processing and other services specific to this market.

Through Xenial, we offer leading-edge enterprise software [added: and hardware] solutions, integrated with our payment services and other adjacent business service applications, to the restaurant and hospitality [removed: and retail] vertical markets.

We sell ecommerce and omnichannel solutions to customers of all sizes, from small businesses accepting payments in a single [removed: country,] [added: country] to enterprise and multinational businesses that have complex payment needs and operate retail and online businesses in multiple countries.

Credit and debit card transaction processing includes the processing of the world's major international card brands, including American Express, Discover Card ("Discover"), JCB, Mastercard, UnionPay International [removed: ("UPI")] and Visa, as well as certain domestic debit networks, such as Interac in Canada.

During a typical payment transaction, the merchant and the card issuer do not interface directly with each other, but instead rely on payments technology companies, such as Global Payments, to facilitate transaction processing services, including authorization, electronic draft capture, file transfers to facilitate funds settlement and certain exception-based, back office support services such as chargeback [removed: and retrieval] resolution.

[removed: ][added: ]

In addition, we provide flexible commercial payments and ePayables solutions that support [removed: business-to-business] [added: B2B] payment processes for businesses and governments.

[removed: Most of these contracts] have prescribed annual minimums, penalties for early termination, and service level agreements that may affect contractual fees if specific service levels are not achieved.

Issuer Solutions [added: segment] revenues also include loyalty redemption services and professional services.

Our Business and Consumer Solutions segment provides general purpose reloadable ("GPR") prepaid debit and payroll cards, demand deposit accounts and other financial service solutions to the underbanked and other consumers and businesses in the United States [added: and parts of Europe] through our Netspend® and other brands.

We also charge fees associated with additional services offered in connection with [removed: our accounts,] [added: programs we manage,] including the use of overdraft features, a variety of bill payment options, card replacement, foreign exchange and card-to-card transfers of funds initiated through our call centers.

Our Merchant Solutions segment competes with financial [removed: institutions and] [added: institutions,] merchant acquirers [added: and other financial technology companies] who provide businesses with merchant acquiring services and related services.

[removed: We believe that as] [added: As] of December 31, [removed: 2020,] [added: 2021,] we [added: believe that we] were one of the largest merchant acquirers in the small and medium-sized business segment (merchants who have less than $5 million in annual bankcard sales volume) in the United States.

In the United States, we compete primarily with Fiserv, Inc. (and its alliances) ("Fiserv"), Fidelity National Information Services, Inc. ("FIS"), Chase Paymentech Solutions, LLC, Elavon, Inc., a subsidiary of U.S. Bancorp, Wells Fargo Bank, N.A and [removed: Square,] [added: Block] Inc. [removed: While these are our primary competitors, our vertically focused business in the United States compete with other organizations.][added: (formerly known as Square, Inc.).]

Our Issuer Solutions segment encounters competition from [added: other] third-party payment card [removed: issuer] processors, [added: the card brands,] core banking platform providers, independent software vendors and various other firms that provide products and services to payment card issuers in the markets we serve.

The United States market for third-party issuer processing is primarily serviced by three vendors, including [removed: TSYS, with our largest competitor being a subsidiary of Fiserv.][added: TSYS.]

[removed: We believe that as] [added: As] of December 31, [removed: 2020,] [added: 2021,] we [added: believe that we] were the largest third-party processor for credit card issuers in North America and one of the largest in Europe based on net revenue from solutions provided to credit card issuers.

Our primary competitors in this space include Green Dot Corporation, [removed: InComm] [added: InComm, Fiserv] and [removed: Fiserv.][added: Chime.]

[removed: As of] December 31, [removed: 2020,] [added: 2021,] we believe that we were one of the two largest prepaid program managers in the United States based on gross dollar volume (total spending on the accounts we manage) processed.

- Leading with technology and innovation to deepen our competitive advantages;

- Delivering commerce enablement solutions globally to broaden our leading position as a sales-driven, product-led company;

- Providing frictionless, best-in-class customer experiences, creating longer-term relationships;

- Nurturing our culture, values and diversity, equity and inclusion initiatives to attract, retain and motivate exceptional team members; and

- Supporting our communities as a socially responsible company with purpose and understanding.

Recent Acquisitions

On June 10, 2021, we acquired Zego, a real estate technology company that provides a comprehensive resident experience management software and digital commerce solutions to property managers, primarily in the United States, for cash consideration of approximately $933 million.

This acquisition aligns with our technology-enabled, software driven strategy and expands our business into a new vertical market.

During the year ended December 31, 2021, we completed other strategic business acquisitions for an aggregate purchase price of approximately $963 million.

Our acquisition of MineralTree, a leading provider of accounts payable automation and B2B payments solutions, expands our target addressable market and provides incremental avenues for growth in one of the most attractive technology markets.

Our acquisitions of the Bankia merchant services business and Worldline's PayOne Austrian acquiring business deepen our presence in Europe and expand the scale of our distribution and technologies.

Most of these contracts

Additionally, our Business and Consumer Solutions segment provides B2B payment services and software-as-a-service (“SaaS”) offerings that automate key procurement processes, including invoice capture, coding and approval, and enable virtual cards and integrated payments options across a variety of key vertical markets.

We have recently commenced a strategic evaluation of the consumer portion of this segment with the intent to focus on our growing B2B portfolio.

While these are our primary competitors, our vertically focused business in the United States competes with other organizations.

Advances in technology are also enabling new entrants, some of which depart from traditional payment models.

We expect competition to continue to increase as new companies enter our markets and existing competitors expand or consolidate their product lines and services.

As of

*Team Member Population*

*Talent Management and Retention*

We place an emphasis on attracting and retaining premier and diverse team members.

To that end, we have implemented programs and initiatives focused on enriching new hire experiences, developing team members through extensive training and professional development opportunities, including mentorship programs, promoting team members’ wellness and safety, particularly during challenging times such as the COVID-19 pandemic, providing flexible work arrangements and offering comprehensive and competitive benefits packages, including paid parental leave, team member assistance and savings and retirement programs.

Further, we honor and recognize the efforts of all of our team members and celebrate our team members through a combination of programs, including team appreciation activities to celebrate all team members and annual awards programs to honor top performers and notable contributors.

We also regularly survey our team members to help us understand their perspectives related to workplace culture, engagement, well-being and to inform our diversity and inclusion strategies and initiatives.

The results from these surveys are leveraged to further develop our talent management initiatives.

For those team members who continued to work in our offices, and as team members have returned in certain regions in accordance with local guidelines and mandates, we have implemented health and safety protocols to help keep our team members safe, such as:

- Expanding resources and benefits available to team members, including hosting team member vaccination clinics, free at-home COVID-19 testing and expanded mental health and well-being initiatives;

In order to help our team members strengthen the skills and behaviors needed for career advancement, our new performance management program enables team members to drive their development with a focus on growth, performance, and well-being through regular meetings with their leader.

In 2020, we undertook a series of initiatives to further enhance our existing diversity and inclusion programs.

We have also broadened our focus on inclusion and diversity by including social and racial equity in our conversations and equipping and empowering our Employee Resource Group ("ERG") leaders with the right tools and training to lead their networks.

Through this plan, our aspirational goals are to:

- Improve diversity at all levels across the company, including increasing the representation of women and minorities in leadership positions;

- Increase team member engagement and awareness through education and participation in diversity and inclusion programs, such as our Conversations of Understanding series we have launched to discuss racial inequality in our communities, and the Inclusion and Diversity Advisory Counsel, consisting of team members worldwide who provide insight and input on the progress of our inclusion and diversity initiatives; and

- Enhance the strategy and initiatives for our ERGs to expand their reach and effectiveness in educating and supporting our team members.

Environmental, Social and Governance ("ESG")

As part of our annual ESG reporting, we provide additional information about our approach to ESG matters in our Global Responsibility Report (which is not incorporated herein), available in the investor relations section of our website at *www.globalpaymentsinc.com*.

banks, distributors and other third parties, privacy and data security policies and procedures and other matters related to our business.

They also impose requirements, which vary materially by jurisdiction, in the event of a personal data breach.

Compliance with the data protection regulations could potentially require substantive technology infrastructure and process changes across many of the Company’s businesses.

Noncompliance with the General Data Protection Regulation ("GDPR"), the California Consumer Privacy Act, or similar laws and regulations could lead to substantial regulatory fines and penalties, or damages from private causes of action.

Merger with Total System Services, Inc.

- Deepen our competitive advantage through our pure play payments strategy;

- Further expand our leadership position in our technology-enabled businesses;

- Enhance and expand our offerings as a product-led, sales-driven company;

- Deliver operational excellence and outstanding customer experiences;

- Continue to develop seamless multinational solutions for leading global customers; and

- Pursue potential domestic and international acquisitions of, investments in and alliances with companies that have high growth potential, significant market presence, sustainable distribution platforms and/or key technological capabilities.

America.

In order to help our employees strengthen the skills and behaviors needed for career advancement, the enhanced curriculum has been mapped to each of our defined leadership capabilities.

Mandatory annual unconscious bias training is also required for all team members.

Additional health and safety measures have been implemented for team members continuing critical work within office locations, such as:

As part of this initiative, we became a signatory to the CEO Action for Diversity and Inclusion, the largest CEO-driven business commitment to advance inclusion and diversity in the workplace.

We have worked to make inclusion and diversity a common thread in all of our human resource practices so that we can attract, develop, and retain the best talent for our workforce.

Our focus on these efforts includes:

- Establishing an Inclusion and Diversity Advisory Council, consisting of team members worldwide who provide insight and input on our inclusion and diversity initiative;

- Launching employee resource groups whose mission is to foster support, professional development, and cultural inclusivity for LGBTQIA, women, veterans, and Black team members;

- Creating a sponsorship program to ensure that women and people of color are represented in succession planning for key leadership roles; and

- Establishing the Social Justice and Equality fund as a part of our pre-established philanthropic giving, which is used to advocate for or support education, health and wellness, financial empowerment and social equality in underserved communities.

For more information on certain of our human capital practices, including inclusion and diversity, refer to the Proxy Statement Summary section of our 2021 Proxy Statement.

of our authorized agents, maintaining permissible investments in an amount equal to or in excess of our outstanding payment obligations, recordkeeping and reporting and disclosures to consumers.

For example, in the United States, we and our financial institution customers are, respectively, subject to the Federal Trade Commission’s and the federal banking regulators’ privacy and information safeguarding requirements under the Gramm-Leach-Bliley Act.

The Federal Trade Commission’s information safeguarding rules require us to develop, implement and maintain a written, comprehensive information security program containing safeguards that are appropriate for our size and complexity, the nature and scope of our activities and the sensitivity of any customer information at issue.

In many jurisdictions, including every U.S. State, consumers must be notified in the event of a data breach, and such notification requirements continue to increase in scope and cost.

The changing privacy laws in the United States, Europe and elsewhere, including the adoption by the European Union of the General Data Protection Regulation, and the California Consumer Privacy Act, which became effective in January 2020, create new individual privacy rights and impose increased obligations on companies handling personal data.

For the fiscal year ended December 31, [removed: 2020][added: 2021]

[removed: ][added: ]

The aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant's most recently completed second fiscal quarter was [removed: $50,324,272,356.][added: $54,617,835,258.]

The number of shares of the registrant's common stock outstanding at February [removed: 16, 2021] [added: 15, 2022] was [removed: 295,243,402] [added: 281,968,006] shares.

Specifically identified portions of the registrant's proxy statement for the [removed: 2021] [added: 2022] annual meeting of shareholders are incorporated by reference in Part III.

[removed: 2020] [added: 2021] ANNUAL REPORT ON FORM 10-K

| ITEM 1. | | | | | | [removed: [BUSINESS](#ib3c23b1e4cd74916962a531a26e0bde7_16)] [added: [BUSINESS](#iaf7770e4cf0e41ae987aea4fecd659f2_16)] | | | [removed: [4](#ib3c23b1e4cd74916962a531a26e0bde7_16)] [added: [4](#iaf7770e4cf0e41ae987aea4fecd659f2_16)] | | |

| ITEM 1A. | | | | | | [RISK [removed: FACTORS](#ib3c23b1e4cd74916962a531a26e0bde7_19)] [added: FACTORS](#iaf7770e4cf0e41ae987aea4fecd659f2_19)] | | | [removed: [14](#ib3c23b1e4cd74916962a531a26e0bde7_19)] [added: [16](#iaf7770e4cf0e41ae987aea4fecd659f2_19)] | | |

| ITEM 2. | | | | | | [removed: [PROPERTIES](#ib3c23b1e4cd74916962a531a26e0bde7_22)] [added: [PROPERTIES](#iaf7770e4cf0e41ae987aea4fecd659f2_22)] | | | [removed: [28](#ib3c23b1e4cd74916962a531a26e0bde7_22)] [added: [29](#iaf7770e4cf0e41ae987aea4fecd659f2_22)] | | |

| ITEM 3. | | | | | | [LEGAL [removed: PROCEEDINGS](#ib3c23b1e4cd74916962a531a26e0bde7_25)] [added: PROCEEDINGS](#iaf7770e4cf0e41ae987aea4fecd659f2_25)] | | | [removed: [28](#ib3c23b1e4cd74916962a531a26e0bde7_25)] [added: [29](#iaf7770e4cf0e41ae987aea4fecd659f2_25)] | | |

| ITEM 5. | | | | | | [MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY [removed: SECURITIES](#ib3c23b1e4cd74916962a531a26e0bde7_31)] [added: SECURITIES](#iaf7770e4cf0e41ae987aea4fecd659f2_31)] | | | [removed: [28](#ib3c23b1e4cd74916962a531a26e0bde7_31)] [added: [30](#iaf7770e4cf0e41ae987aea4fecd659f2_31)] | | |

| ITEM 7. | | | | | | [MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF [removed: OPERATIONS](#ib3c23b1e4cd74916962a531a26e0bde7_37)] [added: OPERATIONS](#iaf7770e4cf0e41ae987aea4fecd659f2_37)] | | | [removed: [32](#ib3c23b1e4cd74916962a531a26e0bde7_37)] [added: [32](#iaf7770e4cf0e41ae987aea4fecd659f2_37)] | | |

| ITEM 7A. | | | | | | [QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET [removed: RISK](#ib3c23b1e4cd74916962a531a26e0bde7_49)] [added: RISK](#iaf7770e4cf0e41ae987aea4fecd659f2_49)] | | | [removed: [45](#ib3c23b1e4cd74916962a531a26e0bde7_49)] [added: [48](#iaf7770e4cf0e41ae987aea4fecd659f2_49)] | | |

| ITEM 8. | | | | | | [FINANCIAL STATEMENTS AND SUPPLEMENTARY [removed: DATA](#ib3c23b1e4cd74916962a531a26e0bde7_52)] [added: DATA](#iaf7770e4cf0e41ae987aea4fecd659f2_52)] | | | [removed: [47](#ib3c23b1e4cd74916962a531a26e0bde7_52)] [added: [50](#iaf7770e4cf0e41ae987aea4fecd659f2_52)] | | |

| ITEM 9. | | | | | | [CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL [removed: DISCLOSURE](#ib3c23b1e4cd74916962a531a26e0bde7_157)] [added: DISCLOSURE](#iaf7770e4cf0e41ae987aea4fecd659f2_142)] | | | [removed: [101](#ib3c23b1e4cd74916962a531a26e0bde7_157)] [added: [103](#iaf7770e4cf0e41ae987aea4fecd659f2_142)] | | |

| ITEM 9A. | | | | | | [CONTROLS AND [removed: PROCEDURES](#ib3c23b1e4cd74916962a531a26e0bde7_160)] [added: PROCEDURES](#iaf7770e4cf0e41ae987aea4fecd659f2_145)] | | | [removed: [101](#ib3c23b1e4cd74916962a531a26e0bde7_160)] [added: [103](#iaf7770e4cf0e41ae987aea4fecd659f2_145)] | | |

| ITEM 10. | | | | | | [DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE [removed: GOVERNANCE](#ib3c23b1e4cd74916962a531a26e0bde7_166)] [added: GOVERNANCE](#iaf7770e4cf0e41ae987aea4fecd659f2_151)] | | | [removed: [102](#ib3c23b1e4cd74916962a531a26e0bde7_166)] [added: [105](#iaf7770e4cf0e41ae987aea4fecd659f2_151)] | | |

| ITEM 11. | | | | | | [EXECUTIVE [removed: COMPENSATION](#ib3c23b1e4cd74916962a531a26e0bde7_169)] [added: COMPENSATION](#iaf7770e4cf0e41ae987aea4fecd659f2_154)] | | | [removed: [102](#ib3c23b1e4cd74916962a531a26e0bde7_169)] [added: [105](#iaf7770e4cf0e41ae987aea4fecd659f2_154)] | | |

| ITEM 12. | | | | | | [SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER [removed: MATTERS](#ib3c23b1e4cd74916962a531a26e0bde7_172)] [added: MATTERS](#iaf7770e4cf0e41ae987aea4fecd659f2_157)] | | | [removed: [102](#ib3c23b1e4cd74916962a531a26e0bde7_172)] [added: [105](#iaf7770e4cf0e41ae987aea4fecd659f2_157)] | | |

| ITEM 13. | | | | | | [CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR [removed: INDEPENDENCE](#ib3c23b1e4cd74916962a531a26e0bde7_175)] [added: INDEPENDENCE](#iaf7770e4cf0e41ae987aea4fecd659f2_160)] | | | [removed: [103](#ib3c23b1e4cd74916962a531a26e0bde7_175)] [added: [105](#iaf7770e4cf0e41ae987aea4fecd659f2_160)] | | |

| ITEM 14. | | | | | | [PRINCIPAL ACCOUNTING FEES AND [removed: SERVICES](#ib3c23b1e4cd74916962a531a26e0bde7_178)] [added: SERVICES](#iaf7770e4cf0e41ae987aea4fecd659f2_163)] | | | [removed: [103](#ib3c23b1e4cd74916962a531a26e0bde7_178)] [added: [106](#iaf7770e4cf0e41ae987aea4fecd659f2_163)] | | |

| ITEM 15. | | | | | | [EXHIBITS, FINANCIAL STATEMENT [removed: SCHEDULES](#ib3c23b1e4cd74916962a531a26e0bde7_184)] [added: SCHEDULES](#iaf7770e4cf0e41ae987aea4fecd659f2_169)] | | | [removed: [103](#ib3c23b1e4cd74916962a531a26e0bde7_184)] [added: [106](#iaf7770e4cf0e41ae987aea4fecd659f2_169)] | | |

Some of the statements we use in this report, and in some of the documents we incorporate by reference in this report, contain forward-looking statements concerning our business operations, economic performance and financial condition, including in particular: our business strategy and means to implement the strategy; measures of future results of operations, such as revenues, expenses, operating margins, income tax rates, and earnings per share; other operating metrics such as shares outstanding and capital expenditures; the effects of the COVID-19 pandemic on our business; our success and timing in developing and introducing new services and expanding our business; and statements about the benefits of our acquisitions, including future financial and operating results, the company’s plans, objectives, expectations and intentions, and the successful integration of our [removed: future] acquisitions or completion of anticipated benefits and strategic initiatives.

Accordingly, we cannot guarantee [removed: you] that our plans and expectations will be achieved.

Important factors, among others, that may otherwise cause actual events or results to differ materially from those anticipated by such forward-looking statements or historical performance include the [removed: timing and severity of the] effects of global economic, political, market, health and social events or other conditions, including the [removed: timing and severity of the] effects [removed: of the COVID-19 pandemic; regulatory measures or voluntary actions, including continued or prolonged social distancing, shelter-in-place orders, operating restrictions on businesses] and [removed: similar measures imposed or undertaken in an effort to combat the spread of the COVID-19 pandemic; management’s assumptions and projections used in their estimates of the timing and severity of the effects] [added: duration] of the COVID-19 pandemic [removed: on our future revenues, results of operations] and [removed: liquidity;] [added: actions taken in response;] our ability to meet our liquidity needs in light of the effects of the COVID-19 [removed: pandemic;] [added: pandemic or otherwise;] the outcome of any legal proceedings that may be instituted against [added: the Company or] our directors; difficulties, delays and higher than anticipated costs related to integrating the businesses of Global Payments and [removed: TSYS,] [added: Total System Services, Inc.,] including with respect to implementing controls to prevent a material security breach of any internal systems or to successfully manage credit and fraud risks in business units; [removed: failing to fully realize anticipated cost savings and other anticipated benefits of] the [removed: Merger when expected] [added: effect of a security breach] or [removed: at all; business disruptions from] [added: operational failure on] the [removed: Merger integration that may harm our business, including current plans and operations;] [added: Company's business;] failing to comply with the applicable requirements of Visa, Mastercard or other payment networks or card schemes or changes in those requirements; the ability to maintain Visa and Mastercard registration and financial institution sponsorship; the ability to [removed: retain] [added: retain, develop] and hire key personnel; the diversion of management’s attention from ongoing business operations; the continued availability of capital and financing; [removed: the business, economic and political conditions in the markets in which we operate;] increased competition in the markets in which we operate and our ability to increase our market share in existing markets and expand into new markets; our ability to safeguard our data; risks associated with our indebtedness, foreign currency exchange and interest rate risks; [added: our ability to meet environmental, social and governance targets, goals and commitments;] the [added: potential] effects of [added: climate change including natural disasters; the effects of] new or changes in current laws, regulations, credit card association rules or other industry [removed: standards,] [added: standards on us or our partners and customers,] including privacy and cybersecurity laws and regulations; and [added: other] events beyond our control, [removed: such as acts of terrorism,] and other factors presented in "Item 1A - Risk Factors" of this Annual Report on Form 10-K, which we advise you to review.

| ITEM 6. | | | | | | [\[RESERVED\]](#iaf7770e4cf0e41ae987aea4fecd659f2_34) | | | [32](#iaf7770e4cf0e41ae987aea4fecd659f2_34) | | |

| ITEM 9B. | | | | | | [OTHER INFORMATION](#iaf7770e4cf0e41ae987aea4fecd659f2_1774) | | | [104](#iaf7770e4cf0e41ae987aea4fecd659f2_1774) | | |

| ITEM 9C. | | | | | | [DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS](#iaf7770e4cf0e41ae987aea4fecd659f2_1768) | | | [104](#iaf7770e4cf0e41ae987aea4fecd659f2_1768) | | |

| | | | | | | [SIGNATURES](#iaf7770e4cf0e41ae987aea4fecd659f2_172) | | | [110](#iaf7770e4cf0e41ae987aea4fecd659f2_172) | | |

| ITEM 6. | | | | | | [SELECTED FINANCIAL DATA](#ib3c23b1e4cd74916962a531a26e0bde7_34) | | | [31](#ib3c23b1e4cd74916962a531a26e0bde7_34) | | |

| | | | | | | [SIGNATURES](#ib3c23b1e4cd74916962a531a26e0bde7_187) | | | [107](#ib3c23b1e4cd74916962a531a26e0bde7_187) | | |

Our common stock trades on the New York Stock Exchange under the ticker symbol "GPN." As of February [removed: 16, 2021,] [added: 15, 2022,] there were [removed: 13,490] [added: 12,906] shareholders of record.

The following graph compares our cumulative shareholder returns with the Standard & Poor's Information Technology Index and the Standard & Poor's 500 Index for the years ended December 31, [added: 2021,] 2020, [removed: 2019 and] [added: 2019,] 2018, [removed: 2017,] and [removed: the 2016 fiscal transition period and the year ended May 31, 2016.][added: 2017.]

The line graph assumes the investment of $100 in our common stock, the Standard & Poor's ("S&P") 500 Index and the Standard & Poor's Information Technology Index on [removed: May] [added: December] 31, [removed: 2015] [added: 2016] and assumes reinvestment of all dividends.

COMPARISON OF [removed: 6] [added: 5] YEAR CUMULATIVE TOTAL RETURN*

[removed: ][added: ]

*$100 invested on [removed: May] [added: December] 31, [removed: 2015] [added: 2016] in stock or index, including reinvestment of dividends.

Copyright© [removed: 2021] [added: 2022] Standard & Poor's, a division of S&P Global.

There were no unregistered sales of equity securities during the year ended December 31, [removed: 2020.][added: 2021.]

Information about the shares of our common stock that we repurchased during the quarter ended December 31, [removed: 2020] [added: 2021] is set forth below:

During the quarter ended December 31, [removed: 2020,] [added: 2021,] pursuant to our employee incentive plans, we withheld [removed: 86,214] [added: 42,416] shares at an average price per share of [removed: $213.96] [added: $135.17] in order to satisfy employees' tax withholding and payment obligations in connection with the vesting of awards of restricted [removed: stock, which we withheld at fair market value on the vesting date.][added: stock.]

[removed: As] [added: (2)As] of December 31, [removed: 2020,] [added: 2021,] the approximate dollar value of shares that may yet be purchased under our share repurchase program was [removed: $1,020.0] [added: $1,540.0] million.

| December 31, 2016 | | | | | | $ | 100.00 | | | | | $ | 100.00 | | | | | $ | 100.00 | |

| December 31, 2017 | | | | | | 144.49 | | | | | | 121.83 | | | | | | 138.83 | | |

| December 31, 2018 | | | | | | 148.70 | | | | | | 116.49 | | | | | | 138.43 | | |

| December 31, 2019 | | | | | | 263.58 | | | | | | 153.17 | | | | | | 208.05 | | |

| December 31, 2020 | | | | | | 312.42 | | | | | | 181.35 | | | | | | 299.37 | | |

| December 31, 2021 | | | | | | 197.10 | | | | | | 233.41 | | | | | | 402.73 | | |

| October 1-31, 2021 | | | 1,685 | | | | | | $ | 158.63 | | | | | — | | | | | | $ | — | |

| November 1-30, 2021 | | | 3,602,123 | | | | | | 129.20 | | | | | | — | | | | | | — | | |

| December 1-31, 2021 | | | 1,918,435 | | | | | | 125.13 | | | | | | — | | | | | | — | | |

| Total | | | 5,522,243 | | | | | | $ | 127.80 | | | | | — | | | | | | $ | 1,540.0 | |

On January 27, 2022, our board of directors approved an increase to our existing share repurchase program authorization, which raised the total available authorization to $2.0 billion.

In 2016, we changed our fiscal year-end from May 31 to December 31.

We refer to the period consisting of the seven-months ended December 31, 2016 as the "2016 fiscal transition period."

| May 31, 2015 | | | | | | $ | 100.00 | | | | | $ | 100.00 | | | | | $ | 100.00 | |

| May 31, 2016 | | | | | | 148.95 | | | | | | 101.72 | | | | | | 103.32 | | |

| December 31, 2016 | | | | | | 133.12 | | | | | | 109.96 | | | | | | 114.53 | | |

| December 31, 2017 | | | | | | 192.33 | | | | | | 133.96 | | | | | | 159.00 | | |

| December 31, 2018 | | | | | | 197.95 | | | | | | 128.09 | | | | | | 158.54 | | |

| December 31, 2019 | | | | | | 350.86 | | | | | | 168.42 | | | | | | 238.27 | | |

| December 31, 2020 | | | | | | 415.89 | | | | | | 199.41 | | | | | | 342.85 | | |

| October 1-31, 2020 | | | 1,412 | | | | | | $ | 177.49 | | | | | — | | | | | | $ | — | |

| November 1-30, 2020 | | | 822,592 | | | | | | 182.79 | | | | | | — | | | | | | — | | |

| December 1-31, 2020 | | | 471,809 | | | | | | 207.33 | | | | | | — | | | | | | — | | |

| Total | | | 1,295,813 | | | | | | $ | 191.72 | | | | | — | | | | | | $ | 1,020.0 | |

(2)On January 28, 2021, the board of directors increased its authorization to repurchase shares of our common stock to $1,500 million, inclusive of prior share repurchase programs authorized by the board and repurchases made thereunder.

You should read the selected financial data set forth below in conjunction with (i) "Item 7 ‑ Management's Discussion and Analysis of Financial Condition and Results of Operations," (ii) "Item 8 ‑ Financial Statements and Supplementary Data" and (iii) the historical consolidated financial statements of Global Payments and the related notes presented in this Annual Report on Form 10-K.

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | Years Ended December 31, | | | | | | | | | | | | | | | | | | | | | | | | Seven Months Ended December 31, 2016 | | | | | | Year Ended May 31, | | |

| | | | 2020 | | | | | | 2019 | | | | | | 2018 | | | | | | 2017 | | | | | | | | | 2016 | | | | | |

| | | | (in thousands, except per share data) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Income statement data: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Revenues | | | $ | 7,423,558 | | | | | $ | 4,911,892 | | | | | $ | 3,366,366 | | | | | $ | 3,975,163 | | | | | $ | 2,202,896 | | | | | $ | 2,898,150 | |

| Operating income | | | 893,953 | | | | | | 791,417 | | | | | | 737,055 | | | | | | 558,868 | | | | | | 237,951 | | | | | | 424,944 | | |

| Net income | | | 605,100 | | | | | | 469,276 | | | | | | 484,667 | | | | | | 494,070 | | | | | | 137,683 | | | | | | 290,217 | | |

| Net income attributable to Global Payments | | | 584,520 | | | | | | 430,613 | | | | | | 452,053 | | | | | | 468,425 | | | | | | 124,931 | | | | | | 271,666 | | |

| Per share data: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Basic earnings per share | | | $ | 1.95 | | | | | $ | 2.17 | | | | | $ | 2.85 | | | | | $ | 3.03 | | | | | $ | 0.81 | | | | | $ | 2.05 | |

| Diluted earnings per share | | | 1.95 | | | | | | 2.16 | | | | | | 2.84 | | | | | | 3.01 | | | | | | 0.81 | | | | | | 2.04 | | |

| Cash dividends declared per common share | | | 0.78 | | | | | | 0.225 | | | | | | 0.04 | | | | | | 0.04 | | | | | | 0.02 | | | | | | 0.04 | | |

| Balance sheet data (at period end): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Total assets | | | $ | 44,201,545 | | | | | $ | 44,480,162 | | | | | $ | 13,230,774 | | | | | $ | 12,998,069 | | | | | $ | 10,664,350 | | | | | $ | 10,509,952 | |

| Settlement lines of credit | | | 358,698 | | | | | | 463,237 | | | | | | 700,486 | | | | | | 635,166 | | | | | | 392,072 | | | | | | 378,436 | | |

| Long-term debt | | | 9,293,764 | | | | | | 9,125,501 | | | | | | 5,130,243 | | | | | | 4,659,716 | | | | | | 4,438,612 | | | | | | 4,515,286 | | |

| Total equity | | | 27,487,044 | | | | | | 28,054,989 | | | | | | 4,186,343 | | | | | | 3,965,231 | | | | | | 2,779,342 | | | | | | 2,877,404 | | |

Our financial results for the year ended December 31, 2020 reflect the unfavorable effects of the COVID-19 pandemic on our revenues as governments took actions to encourage social distancing and implemented shelter-in-place directives, slightly offset by cost-saving actions, such as reductions in employee compensation costs and discretionary spending, to help mitigate the financial effects of the COVID-19 pandemic.

See “Item 7 - Management’s Discussion and Analysis of Financial Condition and Results of Operations” for further discussion of the effects of the COVID-19 pandemic.

As more fully described in "Note 1—Basis of Presentation and Summary of Significant Accounting Policies" in the notes to the accompanying consolidated financial statements, we adopted a new revenue accounting standard on January 1, 2018 that results in revenue being presented net of certain fees that we pay to third parties, including payment networks.

This change in presentation affected our reported revenues and operating expenses for all periods after the year ended December 31, 2017 by the same amount and had no effect on operating income.

The selected financial data in the table above reflect the effects of acquisitions and borrowings to fund certain of those acquisitions.

Notably, in 2019, we completed the Merger for total purchase consideration of $24.5 billion, primarily funded with shares of our common stock.

We also restructured our long-term debt facilities to include a $5.0 billion credit facility, consisting of a senior unsecured $2.0 billion term loan and a $3.0 billion revolving loan facility, and unsecured senior notes of $3.0 billion.

In addition, we also assumed $3.0 billion of TSYS' unsecured senior notes in the Merger.

See "Note 2—Acquisitions" and "Note 8—Long-Term Debt and Lines of Credit," respectively, in the notes to the accompanying consolidated financial statements for further discussion of our acquisitions and borrowing arrangements.

Operating income, net income, net income attributable to Global Payments and basic and diluted earnings per share in the table above reflect acquisition and integration expenses of $320.0 million for the year ended December 31, 2020, $255.6 million for the year ended December 31, 2019, $56.1 million for the year ended December 31, 2018, $94.6 million for the year ended December 31, 2017, $91.6 million for the seven months ended December 31, 2016 and $51.3 million for the year ended May 31, 2016.

Net income, net income attributable to Global Payments and basic and diluted earnings per share in the table above also reflect the following:

(a) the effects of a net income tax benefit of $23.3 million in connection with adjustments made to accounting estimates associated with the U.S. Tax Cuts and Jobs Act of 2017 ("2017 U.S. Tax Act") for the year ended December 31, 2018 and a provisional net income tax benefit of $158.7 million recorded in connection with the 2017 U.S. Tax Act for the year ended December 31, 2017; and

(b) a gain of $27.7 million and $41.2 million for the year ended December 31, 2020 and the seven months ended December 31, 2016, respectively, recognized in connection with the sale of our membership interests in Visa Europe Limited.

We have audited the accompanying consolidated balance sheets of Global Payments Inc. and subsidiaries (the "Company") as of December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] the related consolidated statements of income, comprehensive income, [removed: comprehensive income,] changes in equity, and cash flows, for each of the three years in the period ended December 31, [removed: 2020,] [added: 2021,] and the related notes and the schedule listed in the Index at Item 15 (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, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] and the results of its operations and its cash flows for each of the three years in the period ended December 31, [removed: 2020,] [added: 2021,] in conformity with the applicable accounting principles generally accepted in the United States of America.

We have also 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, [removed: 2020,] [added: 2021,] based on criteria established in *Internal Control - Integrated Framework (2013)* issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February [removed: 19, 2021,] [added: 18, 2022,] expressed an unqualified opinion on the Company's internal control over financial reporting.

We identified the determination of performance obligations for Issuer Solutions revenue contracts as a critical audit matter, given the judgment required to determine whether [removed: promised services are capable of being distinct and are distinct] [added: any unusual and/or complex terms] within the [removed: context of the contract.][added: contract are identified and]

We have audited the internal control over financial reporting of Global Payments Inc. and subsidiaries (the "Company") as of December 31, [removed: 2020,] [added: 2021,] 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 Company maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2020,] [added: 2021,] based on criteria established in Internal Control - Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements and financial statement schedule as of and for the year ended December 31, [removed: 2020,] [added: 2021,] of the Company and our report dated February [removed: 19, 2021,] [added: 18, 2022,] expressed an unqualified opinion on those financial [removed: statements and included an explanatory paragraph regarding the Company’s change in its method of accounting for leases in fiscal year 2019 due to the adoption of Accounting Standards Codification Topic 842, *Leases*.][added: statements.]

| | | | [removed: 2020] [added: 2021] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2018] [added: 2019] | | |

| Revenues | | | $ | [removed: 7,423,558] [added: 8,523,762] | | | | | $ | [removed: 4,911,892] [added: 7,423,558] | | | | | $ | [removed: 3,366,366] [added: 4,911,892] | |

| Cost of service | | | [removed: 3,650,727] [added: 3,773,725] | | | | | | [removed: 2,073,803] [added: 3,650,727] | | | | | | [removed: 1,095,014] [added: 2,073,803] | | |

| Selling, general and administrative | | | [removed: 2,878,878] [added: 3,391,161] | | | | | | [removed: 2,046,672] [added: 2,878,878] | | | | | | [removed: 1,534,297] [added: 2,046,672] | | |

| | | | [removed: 6,529,605] [added: 7,164,886] | | | | | | [removed: 4,120,475] [added: 6,529,605] | | | | | | [removed: 2,629,311] [added: 4,120,475] | | |

| Operating income | | | [removed: 893,953] [added: 1,358,876] | | | | | | [removed: 791,417] [added: 893,953] | | | | | | [removed: 737,055] [added: 791,417] | | |

| Interest and other income | | | [removed: 43,551] [added: 19,320] | | | | | | [removed: 31,413] [added: 43,551] | | | | | | [removed: 20,719] [added: 31,413] | | |

| Interest and other expense | | | [removed: (343,548)] [added: (333,651)] | | | | | | [removed: (304,905)] [added: (343,548)] | | | | | | [removed: (195,619)] [added: (304,905)] | | |

| | | | [removed: (299,997)] [added: (314,331)] | | | | | | [removed: (273,492)] [added: (299,997)] | | | | | | [removed: (174,900)] [added: (273,492)] | | |

| Income before income taxes and equity in income of equity method investments | | | [removed: 593,956] [added: 1,044,545] | | | | | | [removed: 517,925] [added: 593,956] | | | | | | [removed: 562,155] [added: 517,925] | | |

| Income tax expense | | | [removed: 77,153] [added: 169,034] | | | | | | [removed: 62,190] [added: 77,153] | | | | | | [removed: 77,488] [added: 62,190] | | |

| Income before equity in income of equity method investments | | | [removed: 516,803] [added: 875,511] | | | | | | [removed: 455,735] [added: 516,803] | | | | | | [removed: 484,667] [added: 455,735] | | |

| Equity in income of equity method investments, net of tax | | | [removed: 88,297] [added: 112,353] | | | | | | [removed: 13,541] [added: 88,297] | | | | | | [removed: —] [added: 13,541] | | |

| Net income | | | [removed: 605,100] [added: 987,864] | | | | | | [removed: 469,276] [added: 605,100] | | | | | | [removed: 484,667] [added: 469,276] | | |

| Net income attributable to noncontrolling interests | | | [removed: (20,580)] [added: (22,404)] | | | | | | [removed: (38,663)] [added: (20,580)] | | | | | | [removed: (32,614)] [added: (38,663)] | | |

| Net income attributable to Global Payments | | | $ | [removed: 584,520] [added: 965,460] | | | | | $ | [removed: 430,613] [added: 584,520] | | | | | $ | [removed: 452,053] [added: 430,613] | |

| Basic earnings per share | | | $ | [removed: 1.95] [added: 3.30] | | | | | $ | [removed: 2.17] [added: 1.95] | | | | | $ | [removed: 2.85] [added: 2.17] | |

| Diluted earnings per share | | | $ | [removed: 1.95] [added: 3.29] | | | | | $ | [removed: 2.16] [added: 1.95] | | | | | $ | [removed: 2.84] [added: 2.16] | |

| Net income | | | $ | [removed: 605,100] [added: 987,864] | | | | | $ | [removed: 469,276] [added: 605,100] | | | | | $ | [removed: 484,667] [added: 469,276] | |

| Foreign currency translation adjustments | | | [removed: 153,210] [added: (79,550)] | | | | | | [removed: 58,369] [added: 153,210] | | | | | | [removed: (118,439)] [added: 58,369] | | |

| Income tax benefit [removed: (expense)] related to foreign currency translation adjustments | | | [removed: 1,160] [added: 455] | | | | | | [removed: 1,281] [added: 1,160] | | | | | | [removed: (832)] [added: 1,281] | | |

| Net unrealized [removed: losses] [added: gains (losses)] on hedging activities | | | [removed: (52,742)] [added: 3,425] | | | | | | [removed: (90,238)] [added: (52,742)] | | | | | | [removed: (7,553)] [added: (90,238)] | | |

| Reclassification of net unrealized losses [removed: (gains)] on hedging activities to interest expense | | | [removed: 36,510] [added: 40,094] | | | | | | [removed: 2,257] [added: 36,510] | | | | | | [removed: (4,792)] [added: 2,257] | | |

| Income tax [added: (expense)] benefit related to hedging activities | | | [removed: 4,008] [added: (10,466)] | | | | | | [removed: 21,036] [added: 4,008] | | | | | | [removed: 2,972] [added: 21,036] | | |

| Other, net of tax | | | [removed: (7,150)] [added: 3,760] | | | | | | [removed: 4,174] [added: (7,150)] | | | | | | [removed: 760] [added: 4,174] | | |

| Other comprehensive [removed: income] (loss) [added: income] | | | [removed: 134,996] [added: (42,282)] | | | | | | [removed: (3,121)] [added: 134,996] | | | | | | [removed: (127,884)] [added: (3,121)] | | |

| Comprehensive income | | | [removed: 740,096] [added: 945,582] | | | | | | [removed: 466,155] [added: 740,096] | | | | | | [removed: 356,783] [added: 466,155] | | |

| Comprehensive income attributable to noncontrolling interests | | | [removed: (35,223)] [added: (12,123)] | | | | | | [removed: (35,938)] [added: (35,223)] | | | | | | [removed: (29,918)] [added: (35,938)] | | |

| Comprehensive income attributable to Global Payments | | | $ | [removed: 704,873] [added: 933,459] | | | | | $ | [removed: 430,217] [added: 704,873] | | | | | $ | [removed: 326,865] [added: 430,217] | |

| | | | December 31, [removed: 2020] [added: 2021] | | | | | | December 31, [removed: 2019] [added: 2020] | | |

| Cash and cash equivalents | | | $ | [removed: 1,945,868] [added: 1,979,308] | | | | | $ | [removed: 1,678,273] [added: 1,945,868] | |

| Accounts receivable, net | | | [removed: 794,172] [added: 946,247] | | | | | | [removed: 895,232] [added: 794,172] | | |

| Settlement processing assets | | | [removed: 1,230,853] [added: 1,143,539] | | | | | | [removed: 1,353,778] [added: 1,230,853] | | |

evaluated appropriately.

February 18, 2022

As described in Management's Report on Internal Control over Financial Reporting, the Company completed the acquisition of Zego on June 10, 2021, and management excluded from its assessment of internal control over financial reporting the acquired operations of Zego, which constituted approximately 1% of consolidated assets, excluding goodwill, less than 1% of consolidated revenues, and less than 1% of consolidated operating income, as of and for the year ended December 31, 2021.

Accordingly, our audit did not include the internal control over financial reporting of the acquired operations of Zego that is excluded from management’s assessment.

February 18, 2022

| Net income | | | $ | 987,864 | | | | | $ | 605,100 | | | | | $ | 469,276 | |

| Facilities exit charges | | | 51,349 | | | | | | — | | | | | | — | | |

| Distribution received on investments | | | 36,914 | | | | | | 7,738 | | | | | | — | | |

| Contributions from noncontrolling interests | | | 69,987 | | | | | | — | | | | | | — | | |

| Net income | | | | | | | | | | | | | | | 965,460 | | | | | | | | | | | | 965,460 | | | | | | 22,404 | | | | | | 987,864 | | |

| Other comprehensive loss | | | | | | | | | | | | | | | | | | | | | (32,001) | | | | | | (32,001) | | | | | | (10,281) | | | | | | (42,282) | | |

| Contributions from noncontrolling interests | | | | | | | | | | | | | | | | | | | | | | | | | | | — | | | | | | 69,987 | | | | | | 69,987 | | |

| Change in ownership attributable to a noncontrolling interest | | | — | | | | | | (4,524) | | | | | | | | | | | | 92 | | | | | | (4,432) | | | | | | 4,432 | | | | | | — | | |

| Repurchases of common stock | | | (15,169) | | | | | | (2,219,143) | | | | | | (294,486) | | | | | | | | | | | | (2,513,629) | | | | | | | | | | | | (2,513,629) | | |

| Balance at December 31, 2021 | | | 284,750 | | | | | | $ | 22,880,261 | | | | | $ | 2,982,122 | | | | | $ | (234,182) | | | | | $ | 25,628,201 | | | | | $ | 241,216 | | | | | $ | 25,869,417 | |

| Balance at December 31, 2020 | | | 298,332 | | | | | | $ | 24,963,769 | | | | | $ | 2,570,874 | | | | | $ | (202,273) | | | | | $ | 27,332,370 | | | | | $ | 154,674 | | | | | $ | 27,487,044 | |

*COVID-19 Update—* Since early 2020, the global economy has been affected by COVID-19.

Certain government actions to gradually ease restrictions, provide economic stimulus and distribute vaccines have resulted in signs of economic recovery.

would be required to be applied.

Borrowings under the Term Loan Credit Agreement were made in U.S. dollars and borrowings under the Unsecured Revolving Credit Agreement are available to be made in U.S. dollars, euros, sterling, Canadian dollars and, subject to certain conditions, certain other currencies at our option.

In connection with the sunset of certain LIBOR reference rates occurring at the end of 2021, we amended the Unsecured Revolving Credit Agreement in December 2021 to replace LIBOR as administered by the ICE Benchmark Administration with the Sterling Overnight Index Average Reference Rate and the Euro Interbank Offered Rate for any extension of credit denominated in sterling or euros, respectively.

We elected to apply the expedients under ASU 2020-04 to the amendment, the application of which did not result in any effect on our consolidated financial statements.

Further amendments may be necessary to address the LIBOR reference rates applicable to borrowings made in U.S. dollars.

We are still evaluating the effect of the discontinuance of LIBOR on our remaining outstanding debt and hedging instruments and the related effects of ASU 2020-04 on our consolidated financial statements.

Under the current expected credit losses model required by ASU 2016-13, we recognize at asset inception and each

Additionally, certain of our Business and Consumer Solutions customer arrangements provide business-to-business ("B2B") payment services, consisting of a stand-ready obligation to process financial transactions for which revenue is recognized on a daily basis based on the services that are performed on that day.

Other customer contracts include subscription based SaaS arrangements that automate key procurement processes and enable virtual cards and integrated payments options, for which revenue is recognized over time on a ratable basis over the contract term beginning on the date that the services are made available to the customer.

| | | | 2021 | | | | | | 2020 | | |

| Cash and cash equivalents | | | $ | 1,979,308 | | | | | $ | 1,945,868 | |

| Restricted cash | | | 143,715 | | | | | | 143,903 | | |

We have the right to collect the full

total amount of goodwill allocated to that reporting unit.

The useful lives of acquired technologies are based on an estimate of the period over which we expect to receive economic benefit.

When factors indicate that these long-lived assets should be evaluated for possible impairment, we assess the

This

| | | | 2021 | | | | | | 2020 | | | | | | 2019 | | |

*ASU 2021-08*— In October 2021, the FASB issued ASU 2021-08, "Business Combinations (Topic 805): *Accounting for Contract Assets and Contract Liabilities from Contracts with Customers.*" Under current GAAP, an acquirer generally recognizes assets acquired and liabilities assumed in a business combination, including contract assets and contract liabilities arising from revenue contracts with customers and other similar contracts that are accounted for in accordance with ASC Topic 606, at fair value on the acquisition date.

ASU 2021-08 requires that an entity recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with ASC Topic 606.

At the acquisition date, an acquirer should account for the related revenue contracts in accordance with ASC Topic 606 as if it had originated the contracts, which should generally result in an acquirer recognizing and measuring the acquired contract assets and contract liabilities consistent with how they were recognized and measured in the acquiree’s financial statements.

This update also provides certain practical expedients for acquirers when recognizing and measuring acquired contract assets and contract liabilities from revenue contracts in a business combination.

Change in Accounting Principle

As discussed in Note 1 to the consolidated financial statements, the Company changed its method of accounting for leases in fiscal year 2019 due to the adoption of Accounting Standards Codification Topic 842, Leases.

February 19, 2021

| | | | | | | | | | | | |

| Balance at December 31, 2018 | | | 157,962 | | | | | | $ | 2,235,167 | | | | | $ | 2,066,415 | | | | | $ | (310,175) | | | | | $ | 3,991,407 | | | | | $ | 194,936 | | | | | $ | 4,186,343 | |

| Balance at December 31, 2017 | | | 159,180 | | | | | | $ | 2,379,774 | | | | | $ | 1,597,897 | | | | | $ | (183,144) | | | | | $ | 3,794,527 | | | | | $ | 170,704 | | | | | $ | 3,965,231 | |

| Cumulative effect of adoption of new accounting standards | | | | | | | | | | | | | | | 50,969 | | | | | | (1,843) | | | | | | 49,126 | | | | | | | | | | | | 49,126 | | |

| Net income | | | | | | | | | | | | | | | 452,053 | | | | | | | | | | | | 452,053 | | | | | | 32,614 | | | | | | 484,667 | | |

| Other comprehensive income | | | | | | | | | | | | | | | | | | | | | (125,188) | | | | | | (125,188) | | | | | | (2,696) | | | | | | (127,884) | | |

| Distributions to noncontrolling interests | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (5,686) | | | | | | (5,686) | | |

| Repurchases of common stock | | | (1,927) | | | | | | (184,024) | | | | | | (28,172) | | | | | | | | | | | | (212,196) | | | | | | | | | | | | (212,196) | | |

*COVID-19 Update—* In March 2020, the World Health Organization declared the outbreak of the COVID-19 virus a global pandemic.

service contracts following the guidance in Subtopic 350-40 and will continue to do so pursuant to the clarifications provided in the new guidance.

*ASU 2014-09—* We adopted ASU 2014-09, "Revenues from Contracts with Customers (Topic 606)" as well as other clarifications and technical guidance issued by the FASB related to this new revenue standard ("ASC 606") and ASC Subtopic 340-40: "Other Assets and Deferred Costs - Contracts with Customers" ("ASC 340-40") on January 1, 2018.

We elected the modified retrospective transition method, which resulted in a net increase to retained earnings of $51.0 million for the cumulative effect of applying the standard.

The primary components of the cumulative-effect adjustment were changes in the accounting for certain costs to obtain and fulfill customer contracts and the related income tax effects, which resulted in increases to other noncurrent assets and deferred income tax liabilities of $64.6 million and $15.6 million, respectively.

Upon the adoption of ASC 606, we present revenue net of payments made to certain third-parties, including payment networks.

The adoption of ASC 606 did not have a material effect on any other line items in our consolidated statement of income for year ended December 31, 2018 or on any other line items in our consolidated balance sheet as of December 31, 2018 and had no effect on our cash flows from operating activities, investing activities or financing activities included in our consolidated statement of cash flows for the year ended December 31, 2018.

If

| Restricted cash included in prepaid expenses and other current assets | | | 143,903 | | | | | | — | | |

a number of systems and procedures to manage merchant risk.

Capitalized internal-use software is

We believe that the fair value of each of our reporting units is substantially in excess of its carrying amount, except for Issuer Solutions and Business and Consumer Solutions for which the respective carrying amounts approximate fair value since they were recently acquired in the Merger.

initial estimates, we adjust the amortization schedule prospectively.

We present

We will adopt ASU 2019-12 when it becomes effective for us on January 1, 2021.

We have completed our evaluation of the effect of ASU 2019-12 on our consolidated financial statements and internal controls.

or reassessment of a previous accounting determination.

| | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

In addition, the pro forma net income attributable to Global Payments includes presentation of transaction costs of $150 million related to the Merger in earnings in the earliest period presented, the year ended December 31, 2018.

| | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | (in thousands) | | | | | | | | | | | | | | | | | | | | |

*SICOM Systems, Inc.*

On October 17, 2018, we acquired SICOM Systems, Inc. ("SICOM") for total purchase consideration of $410.2 million, which we funded with cash on hand and incremental debt.

SICOM is a provider of end-to-end enterprise, cloud-based software solutions and other technologies to quick service restaurants and food service management companies.

Prior to the acquisition, SICOM was indirectly owned by a private equity investment firm where one of our board members was a partner and investor.

His direct interest in the transaction was approximately $1.1 million, the amount distributed to him based on his investment interest in the fund of the private equity firm that sold SICOM to us.

Based on consideration of all relevant information, the audit committee of our board of directors recommended that the board approve the acquisition of SICOM, which it did.

As of December 31, [removed: 2020,] [added: 2021,] management carried out, under the supervision and with the participation of our principal executive officer and principal financial officer, an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934).

Based on this evaluation, our principal executive officer and principal financial officer concluded that, as of December 31, [removed: 2020,] [added: 2021,] our disclosure controls and procedures were effective in ensuring that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in applicable rules and forms and are designed to ensure that information required to be disclosed in those reports is accumulated and communicated to management, including our principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure.

Our management assessed the effectiveness of our internal control over financial reporting as of December 31, [removed: 2020.][added: 2021.]

Based on the results of its evaluation, [added: which excluded assessments of the internal control of the acquired operations of Zego,] management believes that as of December 31, [removed: 2020,] [added: 2021,] our internal control over financial reporting is effective based on those criteria.

Deloitte & Touche LLP has issued an attestation report on our internal control over financial reporting, which is included herein as the Report of Independent Registered Public Accounting Firm under Item 8 - Financial Statements and Supplementary Data for the year ended December 31, [removed: 2020.][added: 2021.]

On June 10, 2021, we completed the acquisition of Zego.

As permitted by the SEC rules and regulations, management's assessment did not include the internal control of the acquired operations of Zego, which are included in our consolidated financial statements as of December 31, 2021 and for the period from the acquisition date through December 31, 2021.

In accordance with our integration efforts, we plan to incorporate the acquired operations of Zego into our internal control over financial reporting program within the time period provided by applicable SEC rules and regulations.

The assets, excluding goodwill, of the acquired operations of Zego constituted approximately 1% of our total consolidated assets as of December 31, 2021.

Operating results of the acquired operations of Zego comprised less than 1% of our total consolidated revenues and less than 1% of our consolidated operating income for the year ended December 31, 2021.

There were no changes in our internal control over financial reporting during the quarter ended December 31, 2021 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

During the quarter ended December 31, 2020, as part of our ongoing integration activities following the Merger, we continued to apply our controls and procedures to the acquired operations of TSYS and to augment our company-wide controls to address the risks inherent in an acquisition business combination of this magnitude.

Our assessment of the effectiveness of our internal control over financial reporting as of December 31, 2020 includes the acquired operations of TSYS.

PART III

None.

Not Applicable.

PART III

We incorporate by reference in this Item 10 information about our directors, executive officers and our corporate governance contained under the headings "Proposal 1: Election of Directors" and "Biographical Information About Our Executive Officers" [removed: and information about compliance with Section 16(a) of the Securities and Exchange Act of 1934 by our directors and executive officers under the heading "Delinquent Section 16(a) Reports"] from our proxy statement to be delivered in connection with our [removed: 2021] [added: 2022] Annual Meeting of Shareholders to be held on April [removed: 29, 2021 ("2021] [added: 28, 2022 ("2022] Proxy Statement").

We incorporate by reference in this Item 11 the information relating to executive and director compensation and the report of the Compensation Committee contained under the headings "Compensation Discussion and Analysis" and "Board and Corporate Governance-Director Compensation" from our [removed: 2021] [added: 2022] Proxy Statement.

We incorporate by reference in this Item 12 the information relating to ownership of our common stock by certain persons contained under the headings "Common Stock Ownership-Common Stock Ownership by Management" and "Common Stock Ownership-Common Stock Ownership by Non-Management Shareholders" from our [removed: 2021] [added: 2022] Proxy Statement.

The following table provides certain information as of December 31, [removed: 2020] [added: 2021] concerning the shares of our common stock that may be issued under existing equity compensation plans.

The number of securities remaining available for future issuance under equity compensation plans reflected in column (c) above includes [removed: 9,519,101] [added: 8,338,653] shares authorized for issuance under our 2011 Amended and Restated Incentive Plan (the "2011 Incentive Plan"), all of which are available for issuance pursuant to grants of full-value stock awards, [removed: 1,880,010] [added: 1,652,023] shares authorized under our 2000 Employee Stock Purchase Plan (the "2000 ESPP"), 13,554,740 shares authorized under our Total System Services 2017 Omnibus Plan, 7,331,435 shares authorized under our Total System Services 2012 Omnibus Plan, 1,541,327 shares authorized under our Total System Services 2007 Omnibus Plan and 602,611 shares authorized under our Amended and Restated NetSpend Holdings, Inc. 2004 Equity Incentive Plan for Options and Restricted Shares Assumed by Total System Services.

| Equity compensation plans approved by security holders | | | 897,113 | | | | | | $ | 86.80 | | | | | 33,020,789 | | |

| Total | | | 897,113 | | | | | | $ | 86.80 | | | | | 33,020,789 | | |

| Equity compensation plans approved by security holders | | | 858,771 | | | | | | 71.15 | | | | | | 34,429,224 | | |

| Total | | | 858,771 | | | | | | $ | 71.15 | | | | | 34,429,224 | | |

We incorporate by reference in this Item 13 the information regarding certain relationships and related transactions between us and our affiliates and the independence of our directors contained under the headings "Additional Information--Relationships and Related Party Transactions" and "Board and Corporate Governance-Board Independence" from our [removed: 2021] [added: 2022] Proxy Statement.

We incorporate by reference in this Item 14 the information regarding principal accounting fees and services contained under the heading "Proposal Three: Ratification of Reappointment of Auditors" from our [removed: 2021] [added: 2022] Proxy Statement.

| Reports of Independent Registered Public Accounting Firm [added: (PCAOB ID 34)] | | | [removed: [48](#ib3c23b1e4cd74916962a531a26e0bde7_55)] [added: [50](#iaf7770e4cf0e41ae987aea4fecd659f2_55)] | | |

| Consolidated Statements of Income for the years ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018] [added: 2019] | | | [removed: [50](#ib3c23b1e4cd74916962a531a26e0bde7_61)] [added: [53](#iaf7770e4cf0e41ae987aea4fecd659f2_61)] | | |

| Consolidated Statements of Comprehensive Income for the years ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018] [added: 2019] | | | [removed: [51](#ib3c23b1e4cd74916962a531a26e0bde7_64)] [added: [54](#iaf7770e4cf0e41ae987aea4fecd659f2_64)] | | |

| Consolidated Balance Sheets as of December 31, [removed: 2020] [added: 2021] and [removed: 2019] [added: 2020] | | | [removed: [52](#ib3c23b1e4cd74916962a531a26e0bde7_67)] [added: [55](#iaf7770e4cf0e41ae987aea4fecd659f2_67)] | | |

| Consolidated Statements of Cash Flows for the years ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018] [added: 2019] | | | [removed: [53](#ib3c23b1e4cd74916962a531a26e0bde7_73)] [added: [56](#iaf7770e4cf0e41ae987aea4fecd659f2_70)] | | |

| Consolidated Statements of Changes in Equity for the years ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018] [added: 2019] | | | [removed: [54](#ib3c23b1e4cd74916962a531a26e0bde7_76)] [added: [57](#iaf7770e4cf0e41ae987aea4fecd659f2_73)] | | |

| Notes to Consolidated Financial Statements | | | [removed: [56](#ib3c23b1e4cd74916962a531a26e0bde7_85)] [added: [59](#iaf7770e4cf0e41ae987aea4fecd659f2_79)] | | |

| Schedule II, Valuation and Qualifying Accounts | | | [removed: [99](#ib3c23b1e4cd74916962a531a26e0bde7_154)] [added: [102](#iaf7770e4cf0e41ae987aea4fecd659f2_139)] | | |

| [removed: 2.1++] [added: 2.1] | | | [Agreement and Plan of Merger, by and between Total System Services, Inc. and Global Payments Inc., dated as of May 27, 2019, incorporated by reference to Exhibit 2.1 to Global Payment Inc.’s Current Report on Form 8-K filed on May 31, 2019.](http://www.sec.gov/Archives/edgar/data/1123360/000119312519162970/d97493dex21.htm) | | |

| 3.3 | | | [removed: [T](http://www.sec.gov/Archives/edgar/data/1123360/000112336020000013/ex32tenthamendedandres.htm)[enth] [added: [Tenth] Amended and Restated Bylaws of Global Payments Inc., incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K filed on May 1, 2020.](http://www.sec.gov/Archives/edgar/data/1123360/000112336020000013/ex32tenthamendedandres.htm) | | |

| [removed: 4.1] [added: 4.10] | | | [Supplemental Indenture No. 1, dated as of September 17, 2019, among [removed: TSYS Global] [added: TSYS](http://www.sec.gov/Archives/edgar/data/1123360/000119312519250768/d801793dex42.htm)[,](http://www.sec.gov/Archives/edgar/data/1123360/000119312519250768/d801793dex42.htm) [Global] Payments Inc. and Wells Fargo Bank, National Association, incorporated by reference to Exhibit 4.2 to Global Payments Inc.’s Current Report on Form 8-K filed on September 20, 2019.](http://www.sec.gov/Archives/edgar/data/1123360/000119312519250768/d801793dex42.htm) | | |

| 4.12* | | | [Description of Registrant’s Securities Registered pursuant to Section 12 of the Securities Exchange [removed: Act.](https://www.sec.gov/Archives/edgar/data/1123360/000112336021000009/ex412descriptionofregistra.htm)] [added: Act.](https://www.sec.gov/Archives/edgar/data/1123360/000112336022000007/ex412descriptionofregistra.htm)] | | |

| [removed: 10.3] [added: 10.3+] | | | [Global Payments Inc. Sixth Amended and Restated Non-Employee Director Compensation Plan, dated October 24, 2019, incorporated by reference to Exhibit 10.7 to the Company’s Quarterly Report on Form 10-Q filed on October 31, 2019.](http://www.sec.gov/Archives/edgar/data/1123360/000112336019000034/ex107sixthamendedandre.htm) | | |

| [removed: 10.4] [added: 10.4+] | | | [Total System Services, Inc. 2017 Omnibus Plan incorporated by reference to Exhibit 10.1 to TSYS’s Current Report on Form 8-K filed on April 28, 2017.](http://www.sec.gov/Archives/edgar/data/721683/000119312517145788/d369612dex101.htm) | | |

| [removed: 10.5] [added: 10.5+] | | | [Total System Services, Inc. 2012 Omnibus Plan, incorporated by reference to Exhibit 10.1 to TSYS’ Current Report on Form 8-K filed on May 4, 2012.](http://www.sec.gov/Archives/edgar/data/721683/000119312512210470/d345238dex101.htm) | | |

| [removed: 10.6] [added: 10.6+] | | | [Total System Services, Inc. 2007 Omnibus Plan, incorporated by reference to Exhibit 10.1 to TSYS’ Current Report on Form 8-K filed on April 25, 2007.](http://www.sec.gov/Archives/edgar/data/721683/000072168307000003/exhibit101.htm) | | |

| [removed: 10.7] [added: 10.7+] | | | [Amended and Restated NetSpend Holdings, Inc. 2004 Equity Incentive Plan for Options and Restricted Shares Assumed by Total System Services, Inc., incorporated by reference to Exhibit 99.1 to TSYS’ Registration Statement on Form S-8 filed on July 1, 2013.](http://www.sec.gov/Archives/edgar/data/721683/000119312513279237/d562275dex991.htm) | | |

| 10.21+ | | | [Form of Stock Option Award pursuant to the 2011 Amended and Restated Incentive Plan for Executive Officers (calendar 2018) incorporated by reference to Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q filed on May 3, [removed: 2018.](http://www.sec.gov/Archives/edgar/data/1123360/000112336018000016/ex104optionsawardcertifica.htm)[any’s] [added: 2018.any’s] Form 10-Q filed on May 3, 2018.](http://www.sec.gov/Archives/edgar/data/1123360/000112336018000016/ex104optionsawardcertifica.htm) | | |

| [removed: 10.31 +] [added: 10.31+] | | | [Form of Restricted Stock Award pursuant to the 2011 Amended and Restated Incentive Plan for Executive Officers (calendar 2020), incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed on May 6, 2020.](http://www.sec.gov/Archives/edgar/data/1123360/000112336020000020/ex101formofrestricteds.htm) | | |

| [removed: 10.32 +] [added: 10.32+] | | | [Form of Performance Unit Award Agreement pursuant to the 2011 Amended and Restated Incentive Plan for Executive Officers (calendar 2020), incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed on May 6, 2020.](http://www.sec.gov/Archives/edgar/data/1123360/000112336020000020/ex102formofperformance.htm) | | |

| 21.1* | | | [List of [removed: Subsidiaries](https://www.sec.gov/Archives/edgar/data/1123360/000112336021000009/ex211listofsubsidiaries123.htm)[.](https://www.sec.gov/Archives/edgar/data/1123360/000112336021000009/ex211listofsubsidiaries123.htm)] [added: Subsidiaries.](https://www.sec.gov/Archives/edgar/data/1123360/000112336022000007/ex211listofsubsidiaries123.htm)] | | |

| 23.1* | | | [Consent of Independent Registered Public Accounting [removed: Firm.](https://www.sec.gov/Archives/edgar/data/1123360/000112336021000009/ex231consent12312020.htm)] [added: Firm.](https://www.sec.gov/Archives/edgar/data/1123360/000112336022000007/ex231consent12312021.htm)] | | |

| 24.1* | | | [Power of [removed: Attorney.](https://www.sec.gov/Archives/edgar/data/1123360/000112336021000009/ex241powerofattorney123120.htm)] [added: Attorney.](https://www.sec.gov/Archives/edgar/data/1123360/000112336022000007/ex241powerofattorney123120.htm)] | | |

| 31.1* | | | [Rule 13a-14(a)/15d-14(a) Certification of Principal Executive [removed: Officer.](https://www.sec.gov/Archives/edgar/data/1123360/000112336021000009/ex31112312020.htm)] [added: Officer.](https://www.sec.gov/Archives/edgar/data/1123360/000112336022000007/ex31112312021.htm)] | | |

| 31.2* | | | [Rule 13a-14(a)/15d-14(a) Certification of Principal Financial [removed: Officer.](https://www.sec.gov/Archives/edgar/data/1123360/000112336021000009/ex31212312020.htm)] [added: Officer.](https://www.sec.gov/Archives/edgar/data/1123360/000112336022000007/ex31212312021.htm)] | | |

| 32.1* | | | [Certification pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of [removed: 2002.](https://www.sec.gov/Archives/edgar/data/1123360/000112336021000009/ex32112312020.htm)] [added: 2002.](https://www.sec.gov/Archives/edgar/data/1123360/000112336022000007/ex32112312021.htm)] | | |

| 101.1* | | | The following financial information from the Annual Report on Form 10-K for the year ended December 31, [removed: 2020,] [added: 2021,] formatted in Inline XBRL (eXtensible Business Reporting Language) and filed electronically herewith: (i) the Consolidated Statements of Income; (ii) the Consolidated Statements of Comprehensive Income; (iii) the Consolidated Balance Sheets; (iv) the Consolidated Statements of Cash Flows; (v) the Consolidated Statements of Changes in Equity; and (vi) the Notes to Consolidated Financial Statements. | | |

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, Global Payments Inc. has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on February [removed: 19, 2021.][added: 18, 2022.]

| | | | /s/ M. Troy Woods* | | | | | | Chairman of the Board | | | | | | February [removed: 19, 2021] [added: 18, 2022] | | |

| | | | /s/ Kriss Cloninger III* | | | | | | Lead Independent Director | | | | | | February [removed: 19, 2021] [added: 18, 2022] | | |

| | | | /s/ F. Thaddeus Arroyo* | | | | | | Director | | | | | | February [removed: 19, 2021] [added: 18, 2022] | | |

| | | | /s/ Robert H.B. Baldwin, Jr.* | | | | | | Director | | | | | | February [removed: 19, 2021] [added: 18, 2022] | | |

| | | | /s/ John G. Bruno* | | | | | | Director | | | | | | February [removed: 19, 2021] [added: 18, 2022] | | |

| | | | /s/ William I Jacobs* | | | | | | Director | | | | | | February [removed: 19, 2021] [added: 18, 2022] | | |

| | | | /s/ Joia M. Johnson* | | | | | | Director | | | | | | February [removed: 19, 2021] [added: 18, 2022] | | |

| | | | /s/ Ruth Ann Marshall* | | | | | | Director | | | | | | February [removed: 19, 2021] [added: 18, 2022] | | |

| | | | /s/ Connie D. McDaniel* | | | | | | Director | | | | | | February [removed: 19, 2021] [added: 18, 2022] | | |

| | | | /s/ William B. Plummer* | | | | | | Director | | | | | | February [removed: 19, 2021] [added: 18, 2022] | | |

| | | | /s/ John T. Turner* | | | | | | Director | | | | | | February [removed: 19, 2021] [added: 18, 2022] | | |

| | | | /s/ Jeffrey S. Sloan | | | | | | Director | | | | | | February [removed: 19, 2021] [added: 18, 2022] | | |

| 4.15 | | | [Supplemental Indenture No. 3, dated as of February 26, 2021, between Global Payments Inc. and U.S. Bank National Association, as trustee, incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed on February 26, 2021.](http://www.sec.gov/Archives/edgar/data/1123360/000119312521060407/d141432dex42.htm) | | |

| 4.16 | | | Form of Global Note representing the 1.200% Senior Notes due 2026 (included in Exhibit 4.15). | | |

| 4.17 | | | [Supplemental Indenture No. 4, dated as of November 22, 2021, between Global Payments Inc. and U.S. Bank National Association, as trustee, incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed on November 22, 2021.](http://www.sec.gov/Archives/edgar/data/1123360/000119312521336859/d222445dex42.htm) | | |

| 4.18 | | | Form of Global Note representing the Notes (included in Exhibit 4.17) | | |

| 10.34+ | | | [Form of Restricted Stock Award pursuant to the 2011 Amended and Restated Incentive Plan for Executive Officers (calendar 2021), incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed on May 4, 2021.](http://www.sec.gov/Archives/edgar/data/1123360/000112336021000018/ex101formofrestrictedstock.htm) | | |

| 10.35+ | | | [Form of Performance Unit Award Agreement pursuant to the 2011 Amended and Restated Incentive Plan for Executive Officers (calendar 2021), incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed on May 4, 2021.](http://www.sec.gov/Archives/edgar/data/1123360/000112336021000018/ex102formofperformanceunit.htm) | | |

| 10.36+ | | | [Form of Stock Option Award pursuant to the 2011 Amended and Restated Incentive Plan for Executive Officers (calendar 2021), incorporated by reference to Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q filed on May 4, 2021.](http://www.sec.gov/Archives/edgar/data/1123360/000112336021000018/ex103formofstockoptionaward.htm) | | |

| 10.37+ | | | [Form of Supplemental Performance Unit Award Agreement pursuant to the 2011 Amended and Restated Incentive Plan for Executive Officers (calendar 2021), incorporated by reference to Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q filed on May 4, 2021.](http://www.sec.gov/Archives/edgar/data/1123360/000112336021000018/ex104formofsupplementalper.htm) | | |

| 10.38* | | | [LIBOR Transition Amendment dated December 14, 2021, among Global Payments Inc. and the other borrowers party thereto, and Bank of America, N.A., as administrative agent Issuer and the other lenders and L/C/ issuers party thereto.](https://www.sec.gov/Archives/edgar/data/1123360/000112336022000007/ex1038libortransitionamend.htm) | | |

| Index to Exhibits | | | [106](#iaf7770e4cf0e41ae987aea4fecd659f2_169) | | |

| 10.34+ | | | [Underwriting Agreement, dated May 7, 2020, among the Company and the underwriters named therein, incorporated by reference to Exhibit 1.1. to the Company’s Current Report on Form 8-K filed on May 8, 2020.](http://www.sec.gov/Archives/edgar/data/1123360/000119312520136667/d926144dex11.htm) | | |

++ Certain schedules and exhibits to this agreement have been omitted pursuant to Item 601(b)(2) of Regulation S-K and Global Payments Inc. agrees to furnish supplementally to the SEC a copy of any omitted schedule and/or exhibit upon request.

| Index to Exhibits | | | [103](#ib3c23b1e4cd74916962a531a26e0bde7_184) | | |