☒ |
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐ |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
WALGREENS BOOTS ALLIANCE, INC
.
|
||
(Exact name of registrant as specified in its charter)
|
||
Delaware
|
47-1758322
|
|
(State of incorporation)
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(I.R.S. Employer Identification No.)
|
|
108 Wilmot Road, Deerfield, Illinois
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60015
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|
(Address of principal executive offices)
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(Zip Code)
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Title of each class
|
Name of each exchange on which registered
|
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Common Stock ($.01 Par Value)
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The NASDAQ Stock Market LLC
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2.875% Notes due 2020
|
New York Stock Exchange
|
|
3.600% Notes due 2025
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New York Stock Exchange
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2.125% Notes due 2026
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New York Stock Exchange
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Large accelerated filer
☒
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Accelerated filer
☐
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||
Non-accelerated filer
☐
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Smaller reporting company
☐
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Page
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Item 1.
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1
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Item 1A.
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8
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Item 1B.
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26
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Item 2.
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26
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Item 3.
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27
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Item 4.
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27
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27
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Part II
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Item 5.
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29
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Item 6.
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31
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Item 7.
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32
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Item 7A.
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53
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Item 8.
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54
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Item 9.
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98
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Item 9A.
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98
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Item 9B.
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99
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Part III
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Item 10.
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99
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Item 11.
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99
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Item 12.
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99
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Item 13.
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99
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Item 14.
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100
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Part IV
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Item 15.
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100
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111
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· |
Retail Pharmacy USA;
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· |
Retail Pharmacy International; and
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· |
Pharmaceutical Wholesale.
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Fiscal 2016
|
Fiscal 2015
|
Fiscal 2014
|
||||||||||
Pharmacy
|
67
|
%
|
66
|
%
|
64
|
%
|
||||||
Retail
|
33
|
%
|
34
|
%
|
36
|
%
|
||||||
Total
|
100
|
%
|
100
|
%
|
100
|
%
|
Fiscal 2016
|
Fiscal 2015
(1)
|
Fiscal 2014
|
||||||||
Pharmacy
|
35
|
%
|
37
|
%
|
NA
|
|||||
Retail
|
65
|
%
|
63
|
%
|
NA
|
|||||
Total
|
100
|
%
|
100
|
%
|
NA
|
(1) |
Fiscal 2015 includes periods subsequent to the Second Step Transaction, for the months of January through August 2015.
|
·
|
compliance with a wide variety of foreign laws and regulations, including retail and wholesale pharmacy, licensing, tax, foreign trade, intellectual property, privacy and data protection, currency, political and other business restrictions and requirements and local laws and regulations, whose interpretation and enforcement vary significantly among jurisdictions and can change significantly over time;
|
·
|
additional U.S. and other regulation of non-domestic operations, including regulation under the Foreign Corrupt Practices Act, the U.K. Bribery Act and other anti-corruption laws;
|
·
|
potential difficulties in managing foreign operations, mitigating credit risks in foreign markets, enforcing agreements and collecting receivables through foreign legal systems;
|
·
|
price controls imposed by foreign countries;
|
·
|
tariffs, duties or other restrictions on foreign currencies or trade sanctions and other trade barriers imposed by foreign countries that restrict or prohibit business transactions in certain markets;
|
·
|
potential adverse tax consequences, including tax withholding laws and policies and restrictions on repatriation of funds to the United States;
|
·
|
fluctuations in currency exchange rates, including uncertainty regarding the Euro;
|
·
|
impact of recessions and economic slowdowns in economies outside the United States, including foreign currency devaluation, higher interest rates, inflation, and increased government regulation or ownership of traditional private businesses;
|
·
|
the instability of foreign economies, governments and currencies and unexpected regulatory, economic or political changes in foreign markets; and
|
·
|
developing and emerging markets may be especially vulnerable to periods of instability and unexpected changes, and consumers in those markets may have relatively limited resources to spend on products and services.
|
·
|
requiring us to dedicate significant cash flow from operations to the payment of principal, interest and other amounts payable on our debt, which would reduce the funds we have available for other purposes, such as working capital, capital expenditures, acquisitions, share repurchases and dividends;
|
·
|
making it more difficult or expensive for us to obtain any necessary future financing for working capital, capital expenditures, debt service requirements, debt refinancing, acquisitions or other purposes;
|
·
|
reducing our flexibility in planning for or reacting to changes in our industry and market conditions;
|
·
|
making us more vulnerable in the event of a downturn in our business operations; and
|
·
|
exposing us to interest rate risk given that a portion of our debt obligations is at variable interest rates.
|
·
|
actual or anticipated variations in quarterly operating results and the results of competitors;
|
·
|
changes in financial estimates by us or by any securities analysts that might cover us;
|
·
|
conditions or trends in the industry, including regulatory changes or changes in the securities marketplace;
|
·
|
announcements by us or our competitors of significant acquisitions, strategic partnerships or divestitures;
|
·
|
announcements of investigations or regulatory scrutiny of our operations or lawsuits filed against us;
|
·
|
additions or departures of key personnel; and
|
·
|
issuances or sales of our common stock, including sales of shares by our directors and officers or key investors, including the SP Investors and the KKR Investors.
|
·
|
If we are unsuccessful in establishing effective advertising, marketing and promotional programs, our sales or sales margins could be negatively affected.
|
·
|
Our operating costs may be subject to increases outside the control of our businesses, whether due to inflation, new or increased taxes, adverse fluctuations in foreign currency exchange rates, changes in market conditions or otherwise.
|
·
|
Our success depends on our ability to attract, engage and retain store, professional and management personnel, including in executive and other key strategic positions, and the loss of key personnel could have an adverse effect on the results of our operations, financial condition or cash flow.
|
·
|
Natural disasters, civil unrest, severe weather conditions, terrorist activities, global political and economic developments, war, health epidemics or pandemics or the prospect of these events can interrupt or otherwise adversely impact our operations or damage our facilities or those of our strategic partners, vendors and customers and have an adverse impact on consumer confidence levels and spending on our products and services.
|
·
|
If we or our affiliates were to incur significant liabilities or expense relating to the protection of the environment, related health and safety matters, environmental remediation or compliance with environmental laws and regulations, including those governing exposure to, and the management and disposal of, hazardous substances, it could have a material adverse effect on our results of operations, financial condition and cash flow.
|
·
|
The long-term effects of climate change on general economic conditions and the pharmacy industry in particular are unclear, and changes in the supply, demand or available sources of energy and the regulatory and other costs associated with energy production and delivery may affect the availability or cost of goods and services, including natural resources, necessary to run our businesses.
|
·
|
If negative publicity, even if unwarranted, related to safety or quality, human and workplace rights, or other issues damage our brand image and corporate reputation, or that of our vendors or strategic allies, our businesses may suffer.
|
Retail Stores
|
||||
Retail Pharmacy USA:
|
||||
United States
|
8,054
|
|||
Puerto Rico
|
120
|
|||
U.S. Virgin Islands
|
1
|
|||
Total Retail Pharmacy USA
|
8,175
|
|||
Retail Pharmacy International:
|
||||
United Kingdom
|
2,509
|
|||
Mexico
|
1,118
|
|||
Chile
|
438
|
|||
Thailand
|
272
|
|||
Norway
|
161
|
|||
Ireland
|
84
|
|||
The Netherlands
|
65
|
|||
Lithuania
|
26
|
|||
Total Retail Pharmacy International
|
4,673
|
|||
Total
|
12,848
|
Name
|
Age
|
Office(s) Held
|
James A. Skinner
|
71
|
Executive Chairman of the Board
|
Stefano Pessina
|
75
|
Executive Vice Chairman and Chief Executive Officer
|
Ornella Barra
|
62
|
Co-Chief Operating Officer
|
George R. Fairweather
|
59
|
Executive Vice President and Global Chief Financial Officer
|
Alexander W. Gourlay
|
56
|
Co-Chief Operating Officer
|
Ken Murphy
|
50
|
Executive Vice President, Chief Commercial Officer and President of Global Brands
|
Marco Pagni
|
54
|
Executive Vice President, Global Chief Administrative Officer and General Counsel
|
Kimberly R. Scardino
|
45
|
Senior Vice President, Global Controller and Chief Accounting Officer
|
Kathleen Wilson-Thompson
|
59
|
Executive Vice President and Global Chief Human Resources Officer
|
Quarter Ended
|
|||||||||||||||||||||
November
|
February
|
May
|
August
|
Fiscal Year
|
|||||||||||||||||
Fiscal 2016
|
High
|
$
|
95.74
|
$
|
87.05
|
$
|
86.84
|
$
|
85.09
|
$
|
95.74
|
||||||||||
|
Low |
78.90
|
71.50
|
75.74
|
77.22
|
71.50
|
|||||||||||||||
Fiscal 2015
|
High
|
$
|
69.37
|
$
|
83.77
|
$
|
93.42
|
$
|
97.30
|
$
|
97.30
|
||||||||||
Low |
58.39
|
66.46
|
81.01
|
76.01
|
58.39
|
Quarter Ended
|
2016
|
2015
|
||||||
November
|
$
|
0.3600
|
$
|
0.3375
|
||||
February
|
0.3600
|
0.3375
|
||||||
May
|
0.3600
|
0.3375
|
||||||
August
|
0.3750
|
0.3600
|
||||||
$
|
1.4550
|
$
|
1.3725
|
Issuer Purchases of Equity Securities
|
||||||||||||||||
Period
|
Total
Number of
Shares
Purchased
|
Average
Price Paid
per Share
|
Total Number of Shares
Purchased as Part of Publicly
Announced Repurchase
Programs (1)
|
Approximate Dollar Value of
Shares That May Yet be
Purchased Under the Plans or
Program (1)
|
||||||||||||
6/1/16 - 6/30/16
|
-
|
$
|
-
|
-
|
$
|
2,163,991,385
|
||||||||||
7/1/16 - 7/31/16
|
-
|
-
|
-
|
2,163,991,385
|
||||||||||||
8/1/16 - 8/31/16
|
-
|
-
|
-
|
2,163,991,385
|
||||||||||||
Total
|
-
|
$
|
-
|
-
|
$
|
2,163,991,385
|
(1) |
In August 2014, our Board of Directors approved the 2014 share repurchase program which authorized the purchase of up to $3.0 billion of our common stock prior to its expiration on August 31, 2016.
|
Fiscal Year
|
2016
(5)
|
2015
(5)
|
2014
|
2013
|
2012
|
|||||||||||||||
Sales
|
$
|
117,351
|
$
|
103,444
|
$
|
76,392
|
$
|
72,217
|
$
|
71,633
|
||||||||||
Cost of sales
|
87,477
|
76,691
|
54,823
|
51,098
|
51,291
|
|||||||||||||||
Gross Profit
|
29,874
|
26,753
|
21,569
|
21,119
|
20,342
|
|||||||||||||||
Selling, general and administrative expenses
|
23,910
|
22,400
|
17,992
|
17,543
|
16,878
|
|||||||||||||||
Gain on sale of business
|
-
|
-
|
-
|
20
|
-
|
|||||||||||||||
Equity earnings in AmerisourceBergen
(1)
|
37
|
-
|
-
|
-
|
-
|
|||||||||||||||
Equity earnings in Alliance Boots
(2)
|
-
|
315
|
617
|
496
|
-
|
|||||||||||||||
Operating Income
|
6,001
|
4,668
|
4,194
|
4,092
|
3,464
|
|||||||||||||||
Gain on previously held equity interest
(3)
|
-
|
563
|
-
|
-
|
-
|
|||||||||||||||
Other income (expense)
(4)
|
(261
|
)
|
685
|
(481
|
)
|
120
|
-
|
|||||||||||||
Earnings Before Interest and Income Tax Provision
|
5,740
|
5,916
|
3,713
|
4,212
|
3,464
|
|||||||||||||||
Interest expense, net
|
596
|
605
|
156
|
165
|
88
|
|||||||||||||||
Earnings Before Income Tax Provision
|
5,144
|
5,311
|
3,557
|
4,047
|
3,376
|
|||||||||||||||
Income tax provision
|
997
|
1,056
|
1,526
|
1,499
|
1,249
|
|||||||||||||||
Post tax earnings from other equity method investments
|
44
|
24
|
-
|
-
|
-
|
|||||||||||||||
Net Earnings
|
4,191
|
4,279
|
2,031
|
2,548
|
2,127
|
|||||||||||||||
Net earnings attributable to noncontrolling interests
|
18
|
59
|
99
|
-
|
-
|
|||||||||||||||
Net Earnings attributable to Walgreens Boots Alliance, Inc.
|
$
|
4,173
|
$
|
4,220
|
$
|
1,932
|
$
|
2,548
|
$
|
2,127
|
||||||||||
Per Common Share
|
||||||||||||||||||||
Net earnings
|
||||||||||||||||||||
Basic
|
$
|
3.85
|
$
|
4.05
|
$
|
2.03
|
$
|
2.69
|
$
|
2.43
|
||||||||||
Diluted
|
3.82
|
4.00
|
2.00
|
2.67
|
2.42
|
|||||||||||||||
Dividends declared
|
1.46
|
1.37
|
1.28
|
1.14
|
0.95
|
|||||||||||||||
Balance Sheet
|
||||||||||||||||||||
Total Assets
|
$
|
72,688
|
$
|
68,782
|
$
|
37,250
|
$
|
35,632
|
$
|
33,453
|
||||||||||
Long-term debt
|
18,705
|
13,315
|
3,716
|
4,451
|
4,066
|
|||||||||||||||
Total Walgreens Boots Alliance, Inc. Shareholders’ Equity
|
29,880
|
30,861
|
20,513
|
19,558
|
18,236
|
|||||||||||||||
Noncontrolling interests
|
401
|
439
|
104
|
-
|
-
|
|||||||||||||||
Total Equity
|
$
|
30,281
|
$
|
31,300
|
$
|
20,617
|
$
|
19,558
|
$
|
18,236
|
(1) |
Effective March 18, 2016, the Company accounts for its investment in AmerisourceBergen using the equity method of accounting, subject to a two-month reporting lag.
|
(2) |
On August 2, 2012, the Company completed the acquisition of 45% of the issued and outstanding share capital of Alliance Boots GmbH in exchange for cash and Company shares. The Company accounted for this investment under the equity method until the completion of the Second Step Transaction on December 31, 2014. As a result, fiscal 2015 includes the results of Alliance Boots for eight months (January through August 2015) on a fully consolidated basis and four months (September through December 2014) as equity earnings in Alliance Boots reflecting Walgreens’ pre-merger 45% interest.
|
(3) |
In fiscal 2015, as a result of acquiring the remaining 55% interest in Alliance Boots, our previously held 45% interest was remeasured to fair value, resulting in a gain of $563 million.
|
(4) |
In fiscal 2016, 2015, 2014 and 2013, the Company recorded other income (expense) of $(517) million, $779 million, $385 million and $120 million, respectively, from fair value adjustments of the AmerisourceBergen warrants and the amortization of the deferred credit associated with the initial value of the warrants. Fiscal 2016 also includes income of $268 million related to the change in accounting method for our investment in AmerisourceBergen. Fiscal 2015 also includes a $94 million loss on derivative contracts that were not designated as accounting hedges. In fiscal 2014, the Company recognized a non-cash loss of $866 million related to the amendment and exercise of the Alliance Boots call option to acquire the remaining 55% share capital of Alliance Boots.
|
(5) |
To improve comparability, certain classification changes have been made to prior period cost of sales and selling, general and administrative expenses. This change has no impact on operating income.
|
(in millions, except per share amounts)
|
||||||||||||
2016
|
2015
(1)
|
2014
(1)
|
||||||||||
Sales
|
$
|
117,351
|
$
|
103,444
|
$
|
76,392
|
||||||
Gross Profit
|
29,874
|
26,753
|
21,569
|
|||||||||
Selling, general and administrative expenses
|
23,910
|
22,400
|
17,992
|
|||||||||
Operating Income
|
6,001
|
4,668
|
4,194
|
|||||||||
Adjusted Operating Income (Non-GAAP measure)
(2)
|
7,208
|
6,157
|
4,866
|
|||||||||
Earnings Before Interest and Income Tax Provision
|
5,740
|
5,916
|
3,713
|
|||||||||
Net Earnings Attributable to Walgreens Boots Alliance, Inc.
|
4,173
|
4,220
|
1,932
|
|||||||||
Adjusted Net Earnings Attributable to Walgreens Boots Alliance, Inc. (Non-GAAP measure)
(2)
|
5,009
|
4,085
|
3,170
|
|||||||||
Net earnings per common share – diluted
|
3.82
|
4.00
|
2.00
|
|||||||||
Adjusted net earnings per common share – diluted (Non-GAAP measure)
(2)
|
4.59
|
3.88
|
3.28
|
Percentage Increases (Decreases)
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
Sales
|
13.4
|
35.4
|
5.8
|
|||||||||
Gross Profit
|
11.7
|
24.0
|
2.1
|
|||||||||
Selling, general and administrative expenses
|
6.7
|
24.5
|
2.6
|
|||||||||
Operating Income
|
28.6
|
11.3
|
2.5
|
|||||||||
Adjusted Operating Income (Non-GAAP measure)
(2)
|
17.1
|
26.5
|
0.8
|
|||||||||
Earnings Before Interest and Income Tax Provision
|
(3.0
|
)
|
59.3
|
(11.8
|
)
|
|||||||
Net Earnings Attributable to Walgreens Boots Alliance, Inc.
|
(1.1
|
)
|
118.4
|
(24.2
|
)
|
|||||||
Adjusted Net Earnings Attributable to Walgreens Boots Alliance, Inc. (Non-GAAP measure)
(2)
|
22.6
|
28.9
|
2.2
|
|||||||||
Net earnings per common share – diluted
|
(4.5
|
)
|
100.0
|
(25.1
|
)
|
|||||||
Adjusted net earnings per common share – diluted (Non-GAAP measure)
(2)
|
18.3
|
18.3
|
0.9
|
Percent to Sales
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
Gross Margin
|
25.5
|
25.9
|
28.2
|
|||||||||
Selling, general and administrative expenses
|
20.4
|
21.7
|
23.6
|
(1) |
See “--Comparability” above.
|
(2) |
See “--Non-GAAP Measures” below for a reconciliation to the most directly comparable financial measure calculated in accordance with generally accepted accounting principles in the United States (“GAAP”).
|
(in millions, except location amounts)
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
Sales
|
$
|
83,802
|
$
|
80,974
|
$
|
76,392
|
||||||
Gross Profit
|
22,323
|
21,822
|
21,569
|
|||||||||
Selling, general and administrative expenses
|
17,918
|
18,247
|
17,992
|
|||||||||
Operating Income
|
4,405
|
3,890
|
4,194
|
|||||||||
Adjusted Operating Income (Non-GAAP measure)
(1)
|
5,357
|
5,098
|
4,866
|
|||||||||
Number of Prescriptions
(2)
|
740.1
|
723.2
|
698.9
|
|||||||||
30-Day Equivalent Prescriptions
(2)(3)
|
928.5
|
893.8
|
856.4
|
|||||||||
Number of Locations at period end
|
8,184
|
8,182
|
8,309
|
Percentage Increases (Decreases)
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
Sales
|
3.5
|
6.0
|
5.8
|
|||||||||
Gross Profit
|
2.3
|
1.2
|
2.1
|
|||||||||
Selling, general and administrative expenses
|
(1.8
|
)
|
1.4
|
2.6
|
||||||||
Operating Income
|
13.2
|
(7.2
|
)
|
2.5
|
||||||||
Adjusted Operating Income (Non-GAAP measure)
(1)
|
5.1
|
4.8
|
0.8
|
|||||||||
Comparable Store Sales
(4)(5)
|
3.8
|
6.4
|
4.9
|
|||||||||
Pharmacy Sales
|
5.5
|
8.2
|
7.9
|
|||||||||
Comparable Pharmacy Sales
(4)(5)
|
6.0
|
9.3
|
6.8
|
|||||||||
Retail Sales
|
(0.3
|
)
|
1.9
|
2.1
|
||||||||
Comparable Retail Sales
(4)(5)
|
(0.3
|
)
|
1.5
|
2.0
|
||||||||
Comparable Number of Prescriptions
(2)(4)(5)
|
2.3
|
3.5
|
1.8
|
|||||||||
Comparable 30-Day Equivalent Prescriptions
(2)(3)(4)(5)
|
4.0
|
4.6
|
3.9
|
Percent to Sales
|
||||||||||||
2016
|
2015
|
2014
|
||||||||||
Gross Margin
|
26.6
|
26.9
|
28.2
|
|||||||||
Selling, general and administrative expenses
|
21.4
|
22.5
|
23.6
|
(1) |
See “--Non-GAAP Measures” below for a reconciliation to the most directly comparable GAAP measure and related disclosures.
|
(2) |
Includes immunizations.
|
(3) |
Includes the adjustment to convert prescriptions greater than 84 days to the equivalent of three 30-day prescriptions. This adjustment reflects the fact that these prescriptions include approximately three times the amount of product days supplied compared to a normal prescription.
|
(4) |
The fiscal year ended August 31, 2016 figures include an adjustment to remove February 29, 2016 results due to the leap year.
|
(5) |
Comparable stores are defined as those that have been open for at least twelve consecutive months without closure for seven or more consecutive days and without a major remodel or subject to a natural disaster in the past twelve months. Relocated and acquired stores are not included as comparable stores for the first twelve months after the relocation or acquisition. The method of calculating comparable sales varies across the retail industry. As a result, our method of calculating comparable sales may not be the same as other
retailers’
methods.
|
(in millions
, except location amounts
)
|
||||||||||
2016
|
2015
|
2014
|
||||||||
Sales
|
$
|
13,256
|
$
|
8,657
|
NA
|
|||||
Gross Profit
|
5,432
|
3,452
|
NA
|
|||||||
Selling, general and administrative expenses
|
4,403
|
3,043
|
NA
|
|||||||
Operating Income
|
1,029
|
409
|
NA
|
|||||||
Adjusted Operating Income (Non-GAAP measure)
(1)
|
1,155
|
616
|
NA
|
|||||||
Number of Locations at period end
|
4,673
|
4,582
|
NA
|
Percentage Increases
(Decreases)
|
||||||
2016
|
2015
|
|||||
Sales
|
53.1
|
NA
|
||||
Gross Profit
|
57.4
|
NA
|
||||
Selling, general and administrative expenses
|
44.7
|
NA
|
||||
Operating Income
|
151.6
|
NA
|
||||
Adjusted Operating Income (Non-GAAP measure)
(1)
|
87.5
|
NA
|
||||
Comparable Store Sales
(2)
|
|
NA
|
NA
|
|||
Comparable Store Sales in constant currency
(2)(3)
|
|
NA
|
NA
|
|||
Pharmacy Sales
|
46.2
|
NA
|
||||
Comparable Pharmacy Sales
(2)
|
|
NA
|
NA
|
|||
Comparable Pharmacy Sales in constant currency
(2)(3)
|
|
NA
|
NA
|
|||
Retail Sales
|
57.1
|
NA
|
||||
Comparable Retail Sales
(2)
|
NA
|
NA
|
||||
Comparable Retail Sales in constant currency
(2)(3)
|
NA
|
NA
|
Percent to Sales
|
||||||||||
2016
|
2015
|
2014
|
||||||||
Gross Margin
|
41.0
|
39.9
|
NA
|
|||||||
Selling, general and administrative expenses
|
33.2
|
35.1
|
NA
|
NA |
Not Applicable
|
(1) |
See “--Non-GAAP Measures” below for a reconciliation to the most directly comparable GAAP measure and related disclosures.
|
(2) |
Comparable stores are defined as those that have been open for at least twelve consecutive months without closure for seven or more consecutive days and without a major remodel or a natural disaster in the past twelve months. Relocated and acquired stores are not included as comparable stores for the first twelve months after the relocation or acquisition. The method of calculating comparable sales varies across the retail industry. As a result, our method of calculating comparable sales may not be the same as other retailers’ methods.
|
(3) |
Operating results reported in U.S. dollars are affected by foreign currency exchange rate fluctuations. We use the term “constant currency” to represent results that have been adjusted to exclude foreign currency impact. Foreign currency impact represents the difference in results that are attributable to fluctuations in the currency exchange rates used to convert the results for businesses where the functional currency is not the U.S. dollar. This impact is calculated by translating current period results at the currency exchange rates used in the comparable period in the prior year, rather than the exchange rates in effect during the current period. See “--Non-GAAP Measures” below.
|
Percentage Increases
(Decreases)
|
||||||
2016
|
2015
|
|||||
Sales
|
47.3
|
NA
|
||||
Gross Profit
|
43.4
|
NA
|
||||
Selling, general and administrative expenses
|
43.2
|
NA
|
||||
Operating Income
|
54.0
|
NA
|
||||
Adjusted Operating Income (Non-GAAP measure)
(1)
|
57.3
|
NA
|
||||
Comparable Sales
(2)
|
NA
|
NA
|
||||
Comparable Sales in constant currency
(2)(3)
|
NA
|
NA
|
Percent to Sales
|
||||||||||
2016
|
2015
|
2014
|
||||||||
Gross Margin
|
9.4
|
9.7
|
NA
|
|||||||
Selling, general and administrative expenses
|
7.0
|
7.2
|
NA
|
NA |
Not applicable
|
(1) |
See “--Non-GAAP Measures” below for a reconciliation to the most directly comparable GAAP measure and related disclosures.
|
(2) |
Comparable Sales are defined as sales excluding acquisitions and dispositions.
|
(3) |
Operating results reported in U.S. dollars are affected by foreign currency exchange rate fluctuations. We use the term “constant currency” to represent results that have been adjusted to exclude foreign currency impact. Foreign currency impact represents the difference in results that are attributable to fluctuations in the currency exchange rates used to convert the results for businesses where the functional currency is not the U.S. dollar. This impact is calculated by translating current period results at the currency exchange rates used in the comparable period in the prior year, rather than the exchange rates in effect during the current period. See
“--
Non-GAAP Measures” below.
|
(in millions)
|
||||||||||||||||||||
2016
|
||||||||||||||||||||
Retail
Pharmacy
USA
|
Retail
Pharmacy
International
|
Pharmaceutical
Wholesale
|
Eliminations
|
Walgreens
Boots
Alliance, Inc.
|
||||||||||||||||
Operating Income (GAAP)
|
$
|
4,405
|
$
|
1,029
|
$
|
579
|
$
|
(12
|
)
|
$
|
6,001
|
|||||||||
Cost transformation
|
374
|
29
|
21
|
-
|
424
|
|||||||||||||||
Acquisition-related amortization
|
185
|
97
|
87
|
-
|
369
|
|||||||||||||||
LIFO provision
|
214
|
-
|
-
|
-
|
214
|
|||||||||||||||
Acquisition-related costs
|
102
|
-
|
-
|
-
|
102
|
|||||||||||||||
Legal settlement
|
47
|
-
|
-
|
-
|
47
|
|||||||||||||||
Asset impairment
|
30
|
-
|
-
|
-
|
30
|
|||||||||||||||
Adjustments to equity earnings in AmerisourceBergen
|
-
|
-
|
21
|
-
|
21
|
|||||||||||||||
Adjusted Operating Income (Non-GAAP measure)
|
$
|
5,357
|
$
|
1,155
|
$
|
708
|
$
|
(12
|
)
|
$
|
7,208
|
(in millions)
|
||||||||||||||||||||
2014
|
||||||||||||||||||||
Retail
Pharmacy
USA
|
Retail
Pharmacy
International
|
Pharmaceutical
Wholesale
|
Eliminations
|
Walgreens
Boots
Alliance, Inc.
|
||||||||||||||||
Operating Income (GAAP)
|
$
|
4,194
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
4,194
|
||||||||||
Acquisition-related amortization
|
282
|
-
|
-
|
-
|
282
|
|||||||||||||||
LIFO provision
|
132
|
-
|
-
|
-
|
132
|
|||||||||||||||
Acquisition-related costs
|
82
|
-
|
-
|
-
|
82
|
|||||||||||||||
Store closures and other optimization costs
|
271
|
-
|
-
|
-
|
271
|
|||||||||||||||
Gain on sale of business
|
(9
|
)
|
-
|
-
|
-
|
(9
|
)
|
|||||||||||||
Adjustments to equity earnings in Alliance Boots
|
(86
|
) |
-
|
-
|
-
|
(86
|
) | |||||||||||||
Adjusted Operating Income (Non-GAAP measure)
|
$
|
4,866
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
4,866
|
2016
(1)
|
2015
(1)
|
2014
(1)
|
||||||||||
Diluted net earnings per common share (GAAP)
|
$
|
3.82
|
$
|
4.00
|
$
|
2.00
|
||||||
Adjustments to Operating Income
|
1.11
|
1.41
|
0.69
|
|||||||||
Adjustments to Other income (expense)
|
0.24
|
(1.17
|
)
|
0.50
|
||||||||
Adjustments to Interest expense, net
|
0.04
|
0.14
|
-
|
|||||||||
Adjustments to Income tax provision
|
(0.62
|
)
|
(0.50
|
)
|
0.09
|
|||||||
Adjusted diluted net earnings per common share (Non-GAAP measure)
|
$
|
4.59
|
$
|
3.88
|
$
|
3.28
|
||||||
Weighted average common shares outstanding, diluted
(in millions)
|
1,091.1
|
1,053.9
|
965.2
|
(1) |
Presented on a pre-tax basis. The comparable prior periods have been recast accordingly to reflect the tax impact of adjustments as a single adjustment. There has been no change in Net earnings attributable to Walgreens Boots Alliance, Inc.,
diluted
net earnings per share, adjusted net earnings attributable to Walgreens Boots Alliance, Inc. or adjusted net earnings per share from those previously reported.
|
(2) |
Discrete tax-only items.
|
(3) |
Represents the adjustment to the GAAP basis tax provision commensurate with non-GAAP adjustments.
|
2016
|
2015
|
2014
|
||||||||||
Retail Pharmacy USA
|
$
|
777
|
$
|
951
|
$
|
1,106
|
||||||
Retail Pharmacy International
(1)
|
444
|
249
|
-
|
|||||||||
Pharmaceutical Wholesale
(1)
|
104
|
51
|
-
|
|||||||||
Total
|
$
|
1,325
|
$
|
1,251
|
$
|
1,106
|
(1) |
Our Retail Pharmacy International and Pharmaceutical Wholesale segments were acquired as part of the Second Step Transaction in which we acquired the 55% of Alliance Boots that we did not already own on December 31, 2014. As a result of the timing of the acquisition, only eight months of capital expenditures (January through August 2015) have been reported for these divisions in fiscal 2015.
|
Rating Agency
|
Long-Term Debt Rating
|
Commercial
Paper Rating
|
Outlook
|
Fitch
|
BBB
|
F2
|
Stable
|
Moody’s
|
Baa2
|
P-2
|
On review for downgrade
|
Standard & Poor’s
|
BBB
|
A-2
|
Negative
|
Payments Due by Period
|
||||||||||||||||||||
Total
|
Less Than
1 Year
|
1-3 Years
|
3-5 Years
|
Over 5
Years
|
||||||||||||||||
Operating leases
(1)
|
$
|
34,089
|
$
|
3,066
|
$
|
5,798
|
$
|
5,035
|
$
|
20,190
|
||||||||||
Purchase obligations
(2)
:
|
3,108
|
2,922
|
176
|
10
|
-
|
|||||||||||||||
Open inventory purchase orders
|
2,077
|
2,077
|
-
|
-
|
-
|
|||||||||||||||
Real estate development
|
401
|
351
|
50
|
-
|
-
|
|||||||||||||||
Other corporate obligations
|
630
|
494
|
126
|
10
|
-
|
|||||||||||||||
Short-term borrowings and long-term debt
*(3)
|
19,150
|
323
|
2,553
|
4,832
|
11,442
|
|||||||||||||||
Interest payment on short term borrowings and long-term debt
(3)
|
6,723
|
590
|
1,121
|
1,049
|
3,963
|
|||||||||||||||
Insurance
*
|
612
|
201
|
168
|
67
|
176
|
|||||||||||||||
Retirement benefit obligations
|
1,180
|
73
|
127
|
103
|
877
|
|||||||||||||||
Closed location obligations
*
|
467
|
81
|
95
|
68
|
223
|
|||||||||||||||
Capital lease obligations
*(1)
|
1,270
|
68
|
122
|
114
|
966
|
|||||||||||||||
Finance lease obligations
|
1,357
|
18
|
35
|
35
|
1,269
|
|||||||||||||||
Other liabilities reflected on the balance sheet
*(4)
|
1,121
|
147
|
292
|
193
|
489
|
|||||||||||||||
Total
|
$
|
69,077
|
$
|
7,489
|
$
|
10,487
|
$
|
11,506
|
$
|
39,595
|
* |
Recorded on balance sheet.
|
(1) |
Amounts for operating leases and capital leases do not include certain operating expenses under these leases such as common area maintenance, insurance and real estate taxes. These expenses were
$460
million for the fiscal year ended August 31, 2016.
|
(2) |
Purchase obligations include agreements to purchase goods or services that are enforceable and legally binding and that specify all significant terms, including open purchase orders.
|
(3) |
In
addition, in
the event that the merger contemplated by the Merger Agreement with Rite Aid is not consummated on or prior to June 1, 2017 or if the Merger Agreement is terminated at any time on or prior to June 1, 2017, then Walgreens Boots Alliance will be required to redeem the certain series of notes issued on June 1, 2016 on the date described in the applicable note at a redemption price equal to 101% of the aggregate principal amount of the notes to be redeemed, plus accrued and unpaid interest from and including the date of initial issuance, or the most recent date to which interest has been paid, whichever is later, to, but excluding, the date of redemption. In addition, pursuant to the Merger Agreement, if the Merger Agreement is terminated by us or Rite Aid (i) due to the entry of a final order enjoining or prohibiting the merger by any antitrust authority, or (ii) following January 27, 2017 because required antitrust approvals have not been obtained or an antitrust authority has issued an injunction or order preventing the merger, we could be required to pay Rite Aid a termination fee of up to $650 million in certain circumstances. See “Liquidity and Capital Resources” above.
|
(4)
|
Includes $302 million ($59 million in less than 1 year, $168 million in 1-3 years, $75 million in 3-5 years and none over 5 years) of unrecognized tax benefits recorded under Accounting Standards Codification Topic 740, Income Taxes.
|
2016
|
2015
|
|||||||
Assets
|
||||||||
Current Assets:
|
||||||||
Cash and cash equivalents
|
$
|
9,807
|
$
|
3,000
|
||||
Accounts receivable, net
|
6,260
|
6,849
|
||||||
Inventories
|
8,956
|
8,678
|
||||||
Other current assets
|
860
|
1,130
|
||||||
Total Current Assets
|
25,883
|
19,657
|
||||||
Non-Current Assets:
|
||||||||
Property, plant and equipment, at cost, less accumulated depreciation and amortization
|
14,335
|
15,068
|
||||||
Goodwill
|
15,527
|
16,372
|
||||||
Intangible assets
, net
|
10,302
|
12,351
|
||||||
Equity method investments
|
6,174
|
1,242
|
||||||
Other non-current assets
|
467
|
4,092
|
||||||
Total Non-Current Assets
|
46,805
|
49,125
|
||||||
Total Assets
|
$
|
72,688
|
$
|
68,782
|
||||
Liabilities and Equity
|
||||||||
Current Liabilities:
|
||||||||
Short-term borrowings
|
$
|
323
|
$
|
1,068
|
||||
Trade accounts payable
(see Note 19)
|
11,000
|
10,088
|
||||||
Accrued expenses and other liabilities
|
5,484
|
5,225
|
||||||
Income taxes
|
206
|
176
|
||||||
Total Current Liabilities
|
17,013
|
16,557
|
||||||
Non-Current Liabilities:
|
||||||||
Long-term debt
|
18,705
|
13,315
|
||||||
Deferred income taxes
|
2,644
|
3,538
|
||||||
Other non-current liabilities
|
4,045
|
4,072
|
||||||
Total Non-Current Liabilities
|
25,394
|
20,925
|
||||||
Commitments and Contingencies (see Note 12)
|
||||||||
Equity:
|
||||||||
Preferred stock $.01 par value; authorized 32 million shares, none issued
|
-
|
-
|
||||||
Common stock $.01 par value; authorized 3.2 billion shares; issued 1,172,513,618 at August 31, 2016 and 2015
|
12
|
12
|
||||||
Paid-in capital
|
10,111
|
9,953
|
||||||
Employee stock loan receivable
|
(1
|
)
|
(2
|
)
|
||||
Retained earnings
|
27,684
|
25,089
|
||||||
Accumulated other comprehensive (loss) income
|
(2,992
|
)
|
(214
|
)
|
||||
Treasury stock, at cost; 89,527,027 shares at August 31, 2016 and 82,603,274 at August 31, 2015
|
(4,934
|
)
|
(3,977
|
)
|
||||
Total Walgreens Boots Alliance, Inc. Shareholders’ Equity
|
29,880
|
30,861
|
||||||
Noncontrolling interests
|
401
|
439
|
||||||
Total Equity
|
30,281
|
31,300
|
||||||
Total Liabilities and Equity
|
$
|
72,688
|
$
|
68,782
|
Equity attributable to Walgreens Boots Alliance, Inc.
|
||||||||||||||||||||||||||||||||||||
Common Stock
Shares
|
Common
Stock
Amount
|
Treasury
Stock
Amount
|
Paid-In
Capital
|
Employee
Stock
Loan
Receivable
|
Accumulated
Other
Comprehensive
Income (Loss)
|
Retained
Earnings
|
Noncontrolling
Interests
|
Total
Equity
|
||||||||||||||||||||||||||||
August 31, 2013
|
946,595,578
|
$
|
80
|
$
|
(3,114
|
)
|
$
|
1,074
|
$
|
(11
|
)
|
$
|
(92
|
)
|
$
|
21,621
|
$
|
-
|
$
|
19,558
|
||||||||||||||||
Net earnings
|
-
|
-
|
-
|
-
|
-
|
-
|
1,932
|
99
|
2,031
|
|||||||||||||||||||||||||||
Other comprehensive income, net of tax
|
-
|
-
|
-
|
-
|
-
|
228
|
-
|
-
|
228
|
|||||||||||||||||||||||||||
Dividends declared ($1.28 per share)
|
-
|
-
|
-
|
-
|
-
|
-
|
(1,226
|
)
|
-
|
(1,226
|
)
|
|||||||||||||||||||||||||
Treasury stock purchases
|
(11,810,351
|
)
|
-
|
(705
|
)
|
-
|
-
|
-
|
-
|
-
|
(705
|
)
|
||||||||||||||||||||||||
Employee stock purchase and option plans
|
15,601,662
|
-
|
622
|
(16
|
)
|
-
|
-
|
-
|
-
|
606
|
||||||||||||||||||||||||||
Stock-based compensation
|
-
|
-
|
-
|
114
|
-
|
-
|
-
|
-
|
114
|
|||||||||||||||||||||||||||
Employee stock loan receivable
|
-
|
-
|
-
|
-
|
6
|
-
|
-
|
-
|
6
|
|||||||||||||||||||||||||||
Other
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
5
|
5
|
|||||||||||||||||||||||||||
August 31, 2014
|
950,386,889
|
$
|
80
|
$
|
(3,197
|
)
|
$
|
1,172
|
$
|
(5
|
)
|
$
|
136
|
$
|
22,327
|
$
|
104
|
$
|
20,617
|
|||||||||||||||||
Net earnings
|
-
|
-
|
-
|
-
|
-
|
-
|
4,220
|
59
|
4,279
|
|||||||||||||||||||||||||||
Other comprehensive income (loss), net of tax
|
-
|
-
|
-
|
-
|
-
|
(350
|
)
|
-
|
(6
|
)
|
(356
|
)
|
||||||||||||||||||||||||
Dividends declared ($1.37 per share)
|
-
|
-
|
-
|
-
|
-
|
-
|
(1,458
|
)
|
-
|
(1,458
|
)
|
|||||||||||||||||||||||||
Exchange of Walgreen Co. shares for Walgreens Boots Alliance, Inc. shares
|
-
|
(69
|
)
|
-
|
69
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||||||||||
Issuance of shares for Alliance Boots acquisition
|
144,333,468
|
1
|
-
|
10,976
|
-
|
-
|
-
|
-
|
10,977
|
|||||||||||||||||||||||||||
Treasury stock purchases
|
(16,250,190
|
)
|
-
|
(1,226
|
)
|
-
|
-
|
-
|
-
|
-
|
(1,226
|
)
|
||||||||||||||||||||||||
Employee stock purchase and option plans
|
11,440,177
|
-
|
446
|
56
|
-
|
-
|
-
|
-
|
502
|
|||||||||||||||||||||||||||
Stock-based compensation
|
-
|
-
|
-
|
109
|
-
|
-
|
-
|
-
|
109
|
|||||||||||||||||||||||||||
Acquisition of noncontrolling interest
|
-
|
-
|
-
|
(2,429
|
)
|
-
|
-
|
-
|
(130
|
)
|
(2,559
|
)
|
||||||||||||||||||||||||
Employee stock loan receivable
|
-
|
-
|
-
|
-
|
3
|
-
|
-
|
-
|
3
|
|||||||||||||||||||||||||||
Noncontrolling interests in businesses acquired
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
412
|
412
|
|||||||||||||||||||||||||||
August 31, 2015
|
1,089,910,344
|
$
|
12
|
$
|
(3,977
|
)
|
$
|
9,953
|
$
|
(2
|
)
|
$
|
(214
|
)
|
$
|
25,089
|
$
|
439
|
$
|
31,300
|
||||||||||||||||
Net earnings
|
-
|
-
|
-
|
-
|
-
|
-
|
4,173
|
18
|
4,191
|
|||||||||||||||||||||||||||
Other comprehensive income (loss), net of tax
|
-
|
-
|
-
|
-
|
-
|
(2,778
|
)
|
-
|
(56
|
)
|
(2,834
|
)
|
||||||||||||||||||||||||
Dividends declared ($1.46 per share)
|
-
|
-
|
-
|
-
|
-
|
-
|
(1,578
|
)
|
-
|
(1,578
|
)
|
|||||||||||||||||||||||||
Treasury stock purchases
|
(13,815,558
|
)
|
-
|
(1,152
|
)
|
-
|
-
|
-
|
-
|
-
|
(1,152
|
)
|
||||||||||||||||||||||||
Employee stock purchase and option plans
|
6,891,805
|
-
|
195
|
43
|
-
|
-
|
-
|
-
|
238
|
|||||||||||||||||||||||||||
Stock-based compensation
|
-
|
-
|
-
|
115
|
-
|
-
|
-
|
-
|
115
|
|||||||||||||||||||||||||||
Employee stock loan receivable
|
-
|
-
|
-
|
-
|
1
|
-
|
-
|
-
|
1
|
|||||||||||||||||||||||||||
August 31, 2016
|
1,082,986,591
|
$
|
12
|
$
|
(4,934
|
)
|
$
|
10,111
|
$
|
(1
|
)
|
$
|
(2,992
|
)
|
$
|
27,684
|
$
|
401
|
$
|
30,281
|
2016
|
2015
|
2014
|
||||||||||
Sales
|
$
|
117,351
|
$
|
103,444
|
$
|
76,392
|
||||||
Cost of sales
|
87,477
|
76,691
|
54,823
|
|||||||||
Gross Profit
|
29,874
|
26,753
|
21,569
|
|||||||||
Selling, general and administrative expenses
|
23,910
|
22,400
|
17,992
|
|||||||||
Equity earnings in AmerisourceBergen
|
37
|
-
|
-
|
|||||||||
Equity earnings in Alliance Boots
|
-
|
315
|
617
|
|||||||||
Operating Income
|
6,001
|
4,668
|
4,194
|
|||||||||
Gain on previously held equity interest
|
-
|
563
|
-
|
|||||||||
Other income (expense)
|
(261
|
)
|
685
|
(481
|
)
|
|||||||
Earnings Before Interest and Income Tax Provision
|
5,740
|
5,916
|
3,713
|
|||||||||
Interest expense, net
|
596
|
605
|
156
|
|||||||||
Earnings Before Income Tax Provision
|
5,144
|
5,311
|
3,557
|
|||||||||
Income tax provision
|
997
|
1,056
|
1,526
|
|||||||||
Post tax earnings from other equity method investments
|
44
|
24
|
-
|
|||||||||
Net Earnings
|
4,191
|
4,279
|
2,031
|
|||||||||
Net earnings attributable to noncontrolling interests
|
18
|
59
|
99
|
|||||||||
Net Earnings Attributable to Walgreens Boots Alliance, Inc.
|
$
|
4,173
|
$
|
4,220
|
$
|
1,932
|
||||||
Net earnings per common share:
|
||||||||||||
Basic
|
$
|
3.85
|
$
|
4.05
|
$
|
2.03
|
||||||
Diluted
|
$
|
3.82
|
$
|
4.00
|
$
|
2.00
|
||||||
Weighted average common shares outstanding:
|
||||||||||||
Basic
|
1,083.1
|
1,043.2
|
953.1
|
|||||||||
Diluted
|
1,091.1
|
1,053.9
|
965.2
|
2016
|
2015
|
2014
|
||||||||||
Net Earnings
|
$
|
4,191
|
$
|
4,279
|
$
|
2,031
|
||||||
Other comprehensive income (loss), net of tax:
|
||||||||||||
Pension/postretirement obligations
|
(241
|
)
|
14
|
(48
|
)
|
|||||||
Unrealized gain (loss) on cash flow hedges
|
3
|
(13
|
)
|
(27
|
)
|
|||||||
Unrecognized gain (loss) on available-for-sale investments
|
(257
|
)
|
152
|
106
|
||||||||
Share of other comprehensive income (loss) of equity method investments
|
(1
|
)
|
113
|
(18
|
)
|
|||||||
Currency translation adjustments
|
(2,338
|
)
|
(622
|
)
|
215
|
|||||||
Total Other Comprehensive Income (Loss)
|
(2,834
|
)
|
(356
|
)
|
228
|
|||||||
Total Comprehensive Income
|
1,357
|
3,923
|
2,259
|
|||||||||
Comprehensive income (loss) attributable to noncontrolling interests
|
(39
|
)
|
53
|
99
|
||||||||
Comprehensive Income Attributable to Walgreens Boots Alliance, Inc.
|
$
|
1,396
|
$
|
3,870
|
$
|
2,160
|
2016
|
2015
|
2014
|
||||||||||
Cash Flows from Operating Activities
:
|
||||||||||||
Net earnings
|
$
|
4,191
|
$
|
4,279
|
$
|
2,031
|
||||||
Adjustments to reconcile net earnings to net cash provided by operating activities:
|
||||||||||||
Depreciation and amortization
|
1,718
|
1,742
|
1,316
|
|||||||||
Change in fair value of warrants and related amortization
|
516
|
(779
|
)
|
(385
|
)
|
|||||||
Loss on exercise of call option
|
-
|
-
|
866
|
|||||||||
Gain on previously held equity interest
|
-
|
(563
|
)
|
-
|
||||||||
Deferred income taxes
|
(442
|
)
|
(32
|
)
|
177
|
|||||||
Stock compensation expense
|
115
|
109
|
114
|
|||||||||
Equity earnings from equity method investments
|
(81
|
)
|
(339
|
)
|
(619
|
)
|
||||||
Other
|
148
|
752
|
183
|
|||||||||
Changes in operating assets and liabilities:
|
||||||||||||
Accounts receivable, net
|
115
|
(338
|
)
|
(616
|
)
|
|||||||
Inventories
|
(644
|
)
|
719
|
860
|
||||||||
Other current assets
|
66
|
22
|
(10
|
)
|
||||||||
Trade accounts payable
|
1,572
|
268
|
(339
|
)
|
||||||||
Accrued expenses and other liabilities
|
313
|
170
|
195
|
|||||||||
Income taxes
|
202
|
(335
|
)
|
17
|
||||||||
Other non-current assets and liabilities
|
58
|
(11
|
)
|
103
|
||||||||
Net cash provided by operating activities
|
7,847
|
5,664
|
3,893
|
|||||||||
Cash Flows from Investing Activities
:
|
||||||||||||
Additions to property, plant and equipment
|
(1,325
|
)
|
(1,251
|
)
|
(1,106
|
)
|
||||||
Proceeds from sale leaseback transactions
|
60
|
867
|
67
|
|||||||||
Proceeds related to the sale of businesses
|
74
|
814
|
93
|
|||||||||
Proceeds from sale of other assets
|
155
|
184
|
139
|
|||||||||
Alliance Boots acquisition, net of cash acquired
|
-
|
(4,461
|
)
|
-
|
||||||||
Other business and intangible asset acquisitions, net of cash acquired
|
(126
|
)
|
(371
|
)
|
(344
|
)
|
||||||
Investment in AmerisourceBergen
|
(2,360
|
)
|
-
|
(493
|
)
|
|||||||
Other
|
5
|
(58
|
)
|
(87
|
)
|
|||||||
Net cash used for investing activities
|
(3,517
|
)
|
(4,276
|
)
|
(1,731
|
)
|
||||||
Cash Flows from Financing Activities
:
|
||||||||||||
Proceeds and payments of short-term borrowings, net
|
29
|
(226
|
)
|
-
|
||||||||
Proceeds from issuance of long-term debt
|
5,991
|
12,285
|
-
|
|||||||||
Payments of long-term debt
|
(791
|
)
|
(10,472
|
)
|
(550
|
)
|
||||||
Proceeds from finance leases
|
-
|
-
|
268
|
|||||||||
Stock purchases
|
(1,152
|
)
|
(1,226
|
)
|
(705
|
)
|
||||||
Proceeds related to employee stock plans
|
235
|
503
|
612
|
|||||||||
Cash dividends paid
|
(1,563
|
)
|
(1,384
|
)
|
(1,199
|
)
|
||||||
Other
|
(143
|
)
|
(395
|
)
|
(48
|
)
|
||||||
Net cash provided by (used for) financing activities
|
2,606
|
(915
|
)
|
(1,622
|
)
|
|||||||
Effect of exchange rate changes on cash and cash equivalents
|
(129
|
)
|
(119
|
)
|
-
|
|||||||
Changes in Cash and Cash Equivalents
:
|
||||||||||||
Net increase in cash and cash equivalents
|
6,807
|
354
|
540
|
|||||||||
Cash and cash equivalents at beginning of period
|
3,000
|
2,646
|
2,106
|
|||||||||
Cash and cash equivalents at end of period
|
$
|
9,807
|
$
|
3,000
|
$
|
2,646
|
2016
|
2015
|
|||||||
Land and land improvements
|
$
|
3,738
|
$
|
3,687
|
||||
Buildings and building improvements
|
7,557
|
7,705
|
||||||
Fixtures and equipment
|
9,064
|
8,904
|
||||||
Capitalized system development costs and software
|
1,787
|
1,491
|
||||||
Capital lease properties
|
789
|
821
|
||||||
22,935
|
22,608
|
|||||||
Less: accumulated depreciation and amortization
|
8,600
|
7,540
|
||||||
Balance at end of year
|
$
|
14,335
|
$
|
15,068
|
· |
Changes in the fair value of a derivative designated as a fair value hedge, along with the gain or loss on the hedged asset or liability attributable to the hedged risk, are recorded in the Consolidated
Statements
of Earnings.
|
· |
The effective portion of changes in the fair value of a derivative designated as a cash flow hedge is recorded in accumulated other comprehensive income (loss) in the Consolidated
Statements
of Comprehensive Income and reclassified into earnings in the period or periods during which the hedged item affects earnings.
|
· |
The effective portion of changes in the fair value of a derivative designated as a hedge of a net investment in a foreign operation is recorded in cumulative translation adjustments within accumulated other comprehensive income (loss) in the Consolidated
Statements
of Comprehensive Income. Recognition in earnings of amounts previously recorded in cumulative translation adjustments is limited to circumstances such as complete or substantially complete liquidation of the net investment in the hedged investments in foreign operations.
|
· |
Changes in the fair value of a derivative not designated in a hedging relationship are recognized in the Consolidated
Statements
of Earnings along with the ineffective portions of changes in the fair value of derivatives designated in hedging relationships.
|
Retail Pharmacy
|
||||||||||||||||
Fiscal 2016
|
USA
|
International
|
Pharmaceutical Wholesale
|
Consolidated
|
||||||||||||
Asset impairments
|
215
|
10
|
-
|
225
|
||||||||||||
Real estate costs
|
89
|
1
|
1
|
91
|
||||||||||||
Severance and other business transition and exit costs
|
70
|
18
|
20
|
108
|
||||||||||||
Total restructuring costs
|
$
|
374
|
$
|
29
|
$
|
21
|
$
|
424
|
||||||||
Fiscal 2015
|
||||||||||||||||
Asset impairments
|
216
|
7
|
-
|
223
|
||||||||||||
Real estate costs
|
219
|
-
|
-
|
219
|
||||||||||||
Severance and other business transition and exit costs
|
105
|
12
|
-
|
117
|
||||||||||||
Total restructuring costs
|
$
|
540
|
$
|
19
|
$
|
-
|
$
|
559
|
||||||||
Fiscal 2014
|
||||||||||||||||
Asset impairments
|
137
|
-
|
-
|
137
|
||||||||||||
Real estate costs
|
71
|
-
|
-
|
71
|
||||||||||||
Severance and other business transition and exit costs
|
1
|
-
|
-
|
1
|
||||||||||||
Total restructuring costs
|
$
|
209
|
$
|
-
|
$
|
-
|
$
|
209
|
Financing
Obligation
|
Capital
Lease
|
Operating
Lease
|
||||||||||
2017
|
$
|
18
|
$
|
68
|
$
|
3,066
|
||||||
2018
|
18
|
62
|
2,972
|
|||||||||
2019
|
18
|
59
|
2,826
|
|||||||||
2020
|
18
|
58
|
2,632
|
|||||||||
2021
|
18
|
57
|
2,403
|
|||||||||
Later
|
1,267
|
966
|
20,190
|
|||||||||
Total Minimum Lease Payments
|
$
|
1,357
|
$
|
1,270
|
$
|
34,089
|
2016
|
2015
|
|||||||
Balance at beginning of period
|
$
|
446
|
$
|
257
|
||||
Provision for present value of non-cancellable lease payments on closed facilities
|
134
|
231
|
||||||
Assumptions about future sublease income, terminations and changes in interest rates
|
(34
|
)
|
(6
|
)
|
||||
Interest accretion
|
27
|
27
|
||||||
Liability assumed through acquisition of Alliance Boots
|
-
|
13
|
||||||
Cash payments, net of sublease income
|
(107
|
)
|
(76
|
)
|
||||
Balance at end of period
|
$
|
466
|
$
|
446
|
2016
|
2015
|
2014
|
||||||||||
Minimum rentals
|
$
|
3,355
|
$
|
3,176
|
$
|
2,687
|
||||||
Contingent rentals
|
60
|
38
|
5
|
|||||||||
Less: Sublease rental income
|
(49
|
)
|
(46
|
)
|
(22
|
)
|
||||||
$
|
3,366
|
$
|
3,168
|
$
|
2,670
|
2016
|
2015
|
|||||||||||||||
Carrying
Value
|
Ownership
Percentage
|
Carrying
Value
|
Ownership
Percentage
|
|||||||||||||
AmerisourceBergen
|
$
|
4,964
|
24
|
%
|
$
|
NA |
NA
|
|||||||||
Others
|
1,210
|
12% - 50
|
%
|
1,242
|
12% - 50
|
%
|
||||||||||
Total
|
$
|
6,174
|
$
|
1,242
|
Statements of Earnings (in millions)
|
||||||||||
Year Ended August 31,
|
||||||||||
2016
|
2015
(1)
|
2014
(l)
|
||||||||
Net sales
|
NA
|
$
|
13.071
|
$
|
37.579
|
|||||
Gross Profit
|
NA
|
3.050
|
8.096
|
|||||||
Net Earnings
|
NA
|
723
|
1.444
|
|||||||
Share of earnings from equity method investments
(1)
|
NA
|
315
|
617
|
(l)
|
Earnings in foreign equity method investments are translated at their respective average exchange rates.
|
August 31, 2016
|
||||||||||||||||
Amortized
cost basis
|
Gross
unrealized
gains
|
Gross
unrealized
(losses)
|
Fair value
|
|||||||||||||
Corporate bonds and Treasury Bills
|
$
|
30
|
$
|
2
|
$
|
-
|
$
|
32
|
August 31, 2015
|
||||||||||||||||
Amortized
cost basis
|
|
Gross
unrealized
gains
|
|
Gross
unrealized
(losses)
|
Fair value
|
|||||||||||
AmerisourceBergen common stock
|
$
|
717
|
$
|
430
|
$
|
-
|
$
|
1,147
|
||||||||
Corporate bonds and Treasury Bills
|
37
|
-
|
(1
|
)
|
36
|
|||||||||||
Total available-for-sale investments
|
$
|
754
|
$
|
430
|
$
|
(1
|
)
|
$
|
1,183
|
Amount
|
||||
Consideration attributed to WBAD
|
$
|
2,559
|
||
Less: Carrying value of the Company’s pre-existing noncontrolling interest
|
130
|
|||
Impact to additional paid in capital
|
$
|
2,429
|
Consideration paid
|
||||
Cash
|
$
|
4,874
|
||
Common stock
|
10,977
|
|||
Total consideration transferred
|
15,851
|
|||
Less: consideration attributed to WBAD
|
(2,559
|
)
|
||
13,292
|
||||
Fair value of the investment in Alliance Boots held before the Second Step Transaction
|
8,149
|
|||
Total consideration
|
$
|
21,441
|
Identifiable assets acquired and liabilities assumed including noncontrolling interests
|
||||
Cash and cash equivalents
|
$
|
413
|
||
Accounts receivable
|
3,799
|
|||
Inventories
|
3,713
|
|||
Other current assets
|
894
|
|||
Property, plant and equipment
|
3,806
|
|||
Intangible assets
|
11,691
|
|||
Other non-current assets
|
2,217
|
|||
Trade accounts payable, accrued expenses and other liabilities
|
(7,696
|
)
|
||
Borrowings
|
(9,010
|
)
|
||
Deferred income taxes
|
(2,452
|
)
|
||
Other non-current liabilities
|
(383
|
)
|
||
Noncontrolling interests
|
(412
|
)
|
||
Total identifiable net assets and noncontrolling interests
|
6,580
|
|||
Goodwill
|
$
|
14,861
|
Definite-Lived Intangible Assets
|
Weighted-Average Useful
Life (in years)
|
Amount (in millions)
|
||||||
Customer relationships
|
12
|
$
|
1,311
|
|||||
Loyalty card holders
|
20
|
742
|
||||||
Trade names and trademarks
|
9
|
399
|
||||||
Favorable lease interests
|
7
|
93
|
||||||
Total
|
$
|
2,545
|
Indefinite-Lived Intangible Assets
|
Amount (in millions)
|
|||
Trade names and trademarks
|
$
|
6,657
|
||
Pharmacy licenses
|
2,489
|
|||
Total
|
$
|
9,146
|
Year Ended
August 31,
2015
|
Year Ended
August 31,
2014
|
|||||||
(in millions, except per share amounts)
|
||||||||
Sales
|
$
|
116,491
|
$
|
113,896
|
||||
Net earnings
|
4,278
|
3,884
|
||||||
Net earnings per common share:
|
||||||||
Basic
|
$
|
4.10
|
$
|
3.54
|
||||
Diluted
|
4.06
|
3.50
|
Year Ended
August 31,
|
||||
(in millions, except per share amounts)
|
||||
Sales
|
$
|
22,470
|
||
Net earnings
|
853
|
|||
Net earnings per common share:
|
||||
Basic
|
$
|
0.82
|
||
Diluted
|
0.81
|
Retail Pharmacy
USA
|
Retail Pharmacy
International
|
Pharmaceutical
Wholesale
|
Walgreens
Boots
Alliance, Inc.
|
|||||||||||||
August 31, 2014
|
$
|
2,359
|
$
|
-
|
$
|
-
|
$
|
2,359
|
||||||||
Acquisitions
|
7,290
|
4,036
|
3,646
|
14,972
|
||||||||||||
Sale of business
(1)
|
(706
|
)
|
-
|
-
|
(706
|
)
|
||||||||||
Other
(2)
|
(3
|
)
|
-
|
-
|
(3
|
)
|
||||||||||
Currency translation adjustments
|
-
|
(138
|
)
|
(112
|
)
|
(250
|
)
|
|||||||||
August 31, 2015
|
$
|
8,940
|
$
|
3,898
|
$
|
3,534
|
$
|
16,372
|
||||||||
Acquisitions
|
-
|
23
|
-
|
23
|
||||||||||||
Sale of business
|
(4
|
)
|
-
|
-
|
(4
|
)
|
||||||||||
Other
(2)
|
100
|
(113
|
)
|
13
|
-
|
|||||||||||
Currency translation adjustments
|
-
|
(439
|
)
|
(425
|
)
|
(864
|
)
|
|||||||||
August 31, 2016
|
$
|
9,
036
|
$
|
3,
369
|
$
|
3,122
|
$
|
15,527
|
(1) |
Represents goodwill associated with Walgreens Infusion Services business which was sold in April 2015.
|
(2) |
Other primarily represents the reallocation of goodwill between reporting units and purchase accounting adjustments for prior year acquisitions.
|
August 31, 2016
|
August 31, 2015
|
|||||||
Gross Amortizable Intangible Assets
|
||||||||
Customer relationships and loyalty card holders
|
$
|
1,867
|
$
|
2,139
|
||||
Purchased prescription files
|
932
|
885
|
||||||
Favorable lease interests and non-compete agreements
|
619
|
594
|
||||||
Trade names and trademarks
|
532
|
675
|
||||||
Purchasing and payer contracts
|
94
|
94
|
||||||
Total gross amortizable intangible assets
|
4,044
|
4,387
|
||||||
Accumulated amortization
|
||||||||
Customer relationships and loyalty card holders
|
$
|
275
|
$
|
173
|
||||
Purchased prescription files
|
600
|
470
|
||||||
Favorable lease interests and non-compete agreements
|
388
|
299
|
||||||
Trade names and trademarks
|
105
|
83
|
||||||
Purchasing and payer contracts
|
71
|
65
|
||||||
Total accumulated amortization
|
1,439
|
1,090
|
||||||
Total amortizable intangible assets, net
|
$
|
2,605
|
$
|
3,297
|
||||
Indefinite-Lived Intangible Assets
|
||||||||
Trade names and trademarks
|
$
|
5,604
|
$
|
6,590
|
||||
Pharmacy licenses
|
2,093
|
2,464
|
||||||
Total Indefinite-Lived intangible assets
|
$
|
7,697
|
$
|
9,054
|
||||
Total intangible assets, net
|
$
|
10,302
|
$
|
12,351
|
2017
|
2018
|
2019
|
2020
|
2021
|
||||||||||||||||
Estimated annual amortization expense
|
$
|
357
|
$
|
319
|
$
|
293
|
$
|
243
|
$
|
199
|
August 31, 2016
|
August 31, 2015
|
|||||||
Short-Term Borrowings
(
1
)
|
||||||||
Unsecured Pound Sterling variable rate term loan due 2019
|
$
|
63
|
$
|
-
|
||||
Unsecured variable rate notes due 2016
|
-
|
747
|
||||||
Other
(2)
|
260
|
321
|
||||||
Total short-term borrowings
|
$
|
323
|
$
|
1,068
|
||||
Long-Term Debt
(1)
|
||||||||
Unsecured Pound Sterling variable rate term loan due 2019
|
$
|
1,833
|
$
|
2,229
|
||||
$6 Billion Note Issuance
(7)(9)
|
||||||||
1.750% unsecured notes due 2018
|
1,246
|
-
|
||||||
2.600% unsecured notes due 2021
|
1,493
|
-
|
||||||
3.100% unsecured notes due 2023
|
744
|
-
|
||||||
3.450% unsecured notes due 2026
|
1,885
|
-
|
||||||
4.650% unsecured notes due 2046
|
590
|
-
|
||||||
$8 Billion Note Issuance
(7)(9)
|
||||||||
1.750% unsecured notes due 2017
|
746
|
746
|
||||||
2.700% unsecured notes due 2019
|
1,244
|
1,243
|
||||||
3.300% unsecured notes due 2021
|
1,242
|
1,241
|
||||||
3.800% unsecured notes due 2024
|
1,987
|
1,985
|
||||||
4.500% unsecured notes due 2034
|
494
|
494
|
||||||
4.800% unsecured notes due 2044
|
1,492
|
1,491
|
||||||
£700 Million Note Issuance
(3)(7)(9)
|
||||||||
2.875% unsecured Pound Sterling notes due 2020
|
521
|
612
|
||||||
3.600% unsecured Pound Sterling notes due 2025
|
391
|
459
|
||||||
€750 Million Note Issuance
(5)(7)(9)
|
||||||||
2.125% unsecured Euro notes due 2026
|
830
|
836
|
||||||
$4 Billion Note Issuance
(7)(8)(9)
|
||||||||
3.100% unsecured notes due 2022
|
1,194
|
1,193
|
||||||
4.400% unsecured notes due 2042
|
492
|
492
|
||||||
$1 Billion Note Issuance
(8)(9)
|
||||||||
5.250% unsecured notes due 2019
(4)
|
249
|
250
|
||||||
Other
(6)
|
32
|
44
|
||||||
Total long-term debt, less current portion
|
$
|
18,705
|
$
|
13,315
|
(1) |
All notes are presented net of unamortized discount and debt issuance costs, where applicable.
|
(2) |
Other short-term borrowings represent a mix of fixed and variable rate borrowings with various maturities and working capital facilities denominated in various foreign currencies including bank overdrafts.
|
(3) |
Pound Sterling denominated notes are translated at the spot rates at August 31, 2016 and 2015, respectively.
|
(4) |
Includes interest rate swap fair market value adjustments. See Note 11, Fair Value Measurements for additional fair value disclosures.
|
(5) |
Euro denominated notes are translated at the spot rate at August 31, 2016 and 2015.
|
(6) |
Other long-term debt represents a mix of fixed and variable rate borrowings in various foreign currencies with various maturities.
|
(7) |
Notes
are unsubordinated debt obligations of
Walgreens Boots Alliance
and rank equally in right of payment with all other unsecured and unsubordinated indebtedness of
Walgreens Boots Alliance
from time to time outstanding.
|
(8) |
Notes are senior debt obligations of Walgreens and rank equally with all other unsecured and unsubordinated indebtedness of Walgreens. On December 31, 2014, Walgreens Boots Alliance fully and unconditionally guaranteed the outstanding notes on an unsecured and unsubordinated basis. The guarantee, for so long as it is in place, is an unsecured, unsubordinated debt obligation of Walgreens Boots Alliance and will rank equally in right of payment with all other unsecured and unsubordinated indebtedness of Walgreens Boots Alliance.
|
(9) |
The fair value of the $6 billion, $8 billion, £
0.7 billion, €0.75 billion
, $4 billion and $1 billion note issuances as of August 31, 2016 was $6.2 billion,
$7.7 billion, $1.0 billion, $
0.9 billion
, $1.8 billion and $
0.3 billion
, respectively.
The fair values of the notes outstanding are Level 1 fair value measures and determined based on quoted market price and translated at the August 31, 2016 spot rate, as applicable.
|
Year ended August 31,
|
Amount
|
|||
2017
|
$
|
323
|
||
2018
|
2,137
|
|||
2019
|
416
|
|||
2020
|
2,808
|
|||
2021
|
2,024
|
|||
Later
|
11,442
|
|||
Total estimated future maturities
|
$
|
19,150
|
2016
|
Notional
(1)
|
Fair Value
|
Location in Consolidated
Balance Sheets
|
||||||
Derivatives designated as fair value hedges
:
|
|||||||||
Interest rate swaps
|
$
|
250
|
$
|
3
|
Other non-current assets
|
||||
Derivatives not designated as hedges
:
|
|||||||||
Foreign currency forwards
|
1,177
|
16
|
Other current assets
|
||||||
Foreign currency forwards
|
41
|
-
|
Other current liabilities
|
||||||
Basis swap
|
2
|
1
|
Other current liabilities
|
(1) |
Amounts are presented in U.S. dollar equivalents, as applicable.
|
2015
|
Notional
(1)
|
Fair Value
|
Location in Consolidated
Balance Sheets
|
||||||
Derivatives designated as fair value hedges
:
|
|||||||||
Interest rate swaps
|
$
|
250
|
$
|
2
|
Other non-current assets
|
||||
Derivatives designated as cash flow hedges
:
|
|||||||||
Foreign Currency Forwards
|
1,205
|
34
|
Other current assets
|
||||||
Foreign Currency Forwards
|
495
|
9
|
Other current liabilities
|
||||||
Basis Swap
|
1
|
-
|
Other current assets
|
(1) |
Amounts are presented in U.S. dollar equivalents, as applicable.
|
Location in Consolidated
Statements of Earnings
|
2016
|
2015
|
2014
|
||||||||||
Interest rate swaps
|
Interest expense, net
|
$
|
-
|
$
|
1
|
$
|
-
|
||||||
Foreign currency forwards
|
Selling, general and administrative expense
|
19
|
78
|
-
|
|||||||||
Second Step Transaction foreign currency forwards
|
Other income (expense)
|
-
|
(166
|
)
|
-
|
||||||||
Foreign currency forwards
|
Other income (expense)
|
(12
|
)
|
72
|
-
|
Location in Consolidated
Balance Sheets
|
August 31,
2016
|
August 31,
2015
|
|||||||
Asset derivatives not designated as hedges:
|
|||||||||
Warrants
|
Other non-current assets
|
$
|
-
|
$
|
2,140
|
Location in Consolidated Statements of Earnings
|
2016
|
2015
|
2014
|
||||||||||
Warrants
|
Other income (expense)
|
$
|
(546
|
)
|
$
|
759
|
$
|
366
|
Level 1 - |
Quoted prices in active markets that are accessible at the measurement date for identical assets and liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.
|
Level 2 - |
Observable inputs other than quoted prices in active markets.
|
Level 3 - |
Unobservable inputs for which there is little or no market data available. The fair value hierarchy gives the lowest priority to Level 3 inputs.
|
August 31, 2016
|
Level 1
|
Level 2
|
Level 3
|
|||||||||||||
Assets
:
|
||||||||||||||||
Restricted cash
(1)
|
$
|
185
|
$
|
185
|
$
|
-
|
$
|
-
|
||||||||
Money market funds
(2)
|
9,133
|
9,133
|
-
|
-
|
||||||||||||
Available-for-sale investments
(3)
|
32
|
32
|
-
|
-
|
||||||||||||
Interest rate swaps
(4)
|
3
|
-
|
3
|
-
|
||||||||||||
Foreign currency forwards
(5)
|
16
|
-
|
16
|
-
|
||||||||||||
Liabilities
:
|
||||||||||||||||
Basis swaps
(5)
|
1
|
-
|
1
|
-
|
August 31, 2015
|
Level 1
|
Level 2
|
Level 3
|
|||||||||||||
Assets
:
|
||||||||||||||||
Restricted cash
(1)
|
$
|
184
|
$
|
184
|
$
|
-
|
$
|
-
|
||||||||
Money market funds
(2)
|
2,043
|
2,043
|
-
|
-
|
||||||||||||
Available-for-sale investments
(3)
|
1,183
|
1,183
|
-
|
-
|
||||||||||||
Interest rate swaps
(4)
|
2
|
-
|
2
|
-
|
||||||||||||
Foreign currency forwards
(5)
|
34
|
-
|
34
|
-
|
||||||||||||
Warrants
(6)
|
2,140
|
-
|
2,140
|
-
|
||||||||||||
Liabilities
:
|
||||||||||||||||
Foreign currency forwards
(5)
|
9
|
-
|
9
|
-
|
(1) |
Restricted cash consists of deposits restricted under agency agreements and cash restricted by law and other obligations.
|
(2) |
Money market funds are valued at the closing price reported by the fund sponsor.
|
(3) |
Fair values of quoted investments are based on current bid prices as of the balance sheet dates. See Note 6, Available-for-Sale Investments for additional information.
|
(4) |
The fair value of interest rate swaps is calculated by discounting the estimated cash flows received and paid based on the applicable observable yield curves. See Note 10, Financial Instruments for additional information.
|
(5) |
The fair value of basis swaps and forward currency contracts is estimated by discounting the difference between the contractual forward price and the current available forward price for the residual maturity of the contract using observable market rates.
|
(6) |
Warrants were valued using a Monte Carlo simulation. Key assumptions used in the valuation include risk-free interest rates using constant maturity treasury rates; the dividend yield for AmerisourceBergen’s common stock; AmerisourceBergen’s common stock price at the valuation date; AmerisourceBergen’s equity volatility; the number of shares of AmerisourceBergen’s common stock outstanding; the number of AmerisourceBergen employee stock options and the exercise price; and the details specific to the warrants.
|
2016
|
2015
|
2014
|
||||||||||
U.S.
|
$
|
2,577
|
$
|
2,725
|
$
|
3,386
|
||||||
Non – U.S.
|
2,567
|
2,586
|
171
|
|||||||||
Total
|
$
|
5,144
|
$
|
5,311
|
$
|
3,557
|
2016
|
2015
|
2014
|
||||||||||
Current provision
|
||||||||||||
Federal
|
$
|
999
|
$
|
846
|
$
|
1,207
|
||||||
State
|
56
|
121
|
109
|
|||||||||
Non – U.S.
|
371
|
128
|
35
|
|||||||||
1,426
|
1,095
|
1,351
|
||||||||||
Deferred provision
|
||||||||||||
Federal
|
(183
|
)
|
(23
|
)
|
183
|
|||||||
State
|
6
|
(16
|
)
|
(3
|
)
|
|||||||
Non – U.S. – Tax Law Change
|
(182
|
)
|
-
|
-
|
||||||||
Non – U.S.
– Excluding Tax Law Change
|
(
70
|
)
|
-
|
(5
|
)
|
|||||||
(429
|
)
|
(39
|
)
|
175
|
||||||||
Income tax provision
|
$
|
997
|
$
|
1,056
|
$
|
1,526
|
2016
|
2015
|
2014
|
||||||||||
Federal statutory rate
|
35.0
|
%
|
35.0
|
%
|
35.0
|
%
|
||||||
State income taxes, net of federal benefit
|
0.8
|
1.3
|
1.9
|
|||||||||
Loss on Alliance Boots call option
(1)
|
-
|
-
|
8.5
|
|||||||||
Deferred tax asset recognition
(1)
|
-
|
(4.1
|
)
|
-
|
||||||||
Gain on previously held equity interest
|
-
|
(5.8
|
)
|
-
|
||||||||
Foreign income taxed at non-U.S. rates
|
(7.8
|
)
|
(6.2
|
)
|
(3.1
|
)
|
||||||
Non-taxable income
|
(4.4
|
)
|
(2.6
|
)
|
-
|
|||||||
Non-deductible expenses
|
1.1
|
2.3
|
0.3
|
|||||||||
Tax Law changes
|
(3.5
|
)
|
-
|
-
|
||||||||
Tax Credits
|
(1.5
|
)
|
-
|
-
|
||||||||
Other
|
(0.3
|
)
|
-
|
0.3
|
||||||||
Effective income tax rate
|
19.4
|
%
|
19.9
|
%
|
42.9
|
%
|
(1) |
Upon the amendment and immediate exercise of the call option to acquire the remaining 55% ownership of Alliance Boots, the Company was required to compare the fair value of the amended option with the book value of the original option with a gain or loss recognized for the difference. The fair value of the amended option resulted in a financial statement loss of $866 million. The loss on the Alliance Boots call option was, in part, a capital loss and available to be carried forward and offset future capital gains through fiscal 2020. In 2015, the deferred tax asset related to the loss was recognized, resulting in the 4.1% effective tax rate benefit reported in the table above.
|
2016
|
2015
|
|||||||
Deferred tax assets
|
||||||||
Postretirement benefits
|
$
|
190
|
$
|
130
|
||||
Compensation and benefits
|
205
|
224
|
||||||
Insurance
|
75
|
68
|
||||||
Accrued rent
|
169
|
167
|
||||||
Outside basis difference
|
134
|
73
|
||||||
Bad debts
|
65
|
67
|
||||||
Tax attributes
|
373
|
341
|
||||||
Stock compensation
|
97
|
119
|
||||||
Deferred income
|
150
|
-
|
||||||
Other
|
195
|
93
|
||||||
1,653
|
1,282
|
|||||||
Less: Valuation allowance
|
305
|
125
|
||||||
Total deferred tax assets
|
1,348
|
1,157
|
||||||
Deferred tax liabilities
|
||||||||
Accelerated depreciation
|
1,205
|
1,234
|
||||||
Inventory
|
388
|
420
|
||||||
Intangible assets
|
1,418
|
1,822
|
||||||
Equity method investment
|
978
|
333
|
||||||
Deferred income
|
-
|
889
|
||||||
3,989
|
4,698
|
|||||||
Net deferred tax liabilities
|
$
|
2,641
|
$
|
3,541
|
2016
|
2015
|
2014
|
||||||||||
Balance at beginning of year
|
$
|
261
|
$
|
193
|
$
|
208
|
||||||
Gross increases related to business combination
|
-
|
84
|
-
|
|||||||||
Gross increases related to tax positions in a prior period
|
21
|
45
|
55
|
|||||||||
Gross decreases related to tax positions in a prior period
|
(47
|
)
|
(75
|
)
|
(82
|
)
|
||||||
Gross increases related to tax positions in the current period
|
68
|
63
|
46
|
|||||||||
Settlements with taxing authorities
|
(17
|
)
|
(45
|
)
|
(22
|
)
|
||||||
Currency
|
(11
|
)
|
-
|
-
|
||||||||
Lapse of statute of limitations
|
(6
|
)
|
(4
|
)
|
(12
|
)
|
||||||
Balance at end of year
|
$
|
269
|
$
|
261
|
$
|
193
|
Percentage of Fair Market Value
|
2016
|
2015
|
||||||
Equity securities
|
8.9%
|
|
9.5%
|
|
||||
Debt securities
|
78.8%
|
|
81.5%
|
|
||||
Real estate
|
4.3%
|
|
5.6%
|
|
||||
Other
|
8.0%
|
|
3.4%
|
|
August 31, 2016
|
Level 1
|
Level 2
|
Level 3
|
|||||||||||||
Equity securities
:
|
||||||||||||||||
Equity securities
(1)
|
$
|
834
|
$
|
-
|
$
|
834
|
$
|
-
|
||||||||
Debt securities:
|
||||||||||||||||
Fixed interest government bonds
(2)
|
265
|
-
|
265
|
-
|
||||||||||||
Index linked government bonds
(2)
|
3,502
|
-
|
3,502
|
-
|
||||||||||||
Corporate bonds
(3)
|
3,663
|
-
|
3,663
|
-
|
||||||||||||
Real estate:
|
|
|
||||||||||||||
Real estate
(4)
|
411
|
-
|
-
|
411
|
||||||||||||
Other
:
|
||||||||||||||||
Other investments
(5)
|
753
|
38
|
713
|
2
|
||||||||||||
Total
|
$
|
9,428
|
$
|
38
|
$
|
8,977
|
$
|
413
|
August 31, 2015
|
Level 1
|
Level 2
|
Level 3
|
|||||||||||||
Equity securities
:
|
||||||||||||||||
Equity securities
(1)
|
$
|
852
|
$
|
-
|
$
|
852
|
$
|
-
|
||||||||
Debt securities:
|
||||||||||||||||
Fixed interest government bonds
(2)
|
267
|
-
|
267
|
-
|
||||||||||||
Index linked government bonds
(2)
|
1,006
|
-
|
1,006
|
-
|
||||||||||||
Corporate bonds
(3)
|
5,535
|
-
|
5,535
|
-
|
||||||||||||
Other bonds
(6)
|
472
|
-
|
472
|
-
|
||||||||||||
Real estate:
|
||||||||||||||||
Real estate
(4)
|
502
|
-
|
-
|
502
|
||||||||||||
Other
:
|
||||||||||||||||
Other investments
(5)
|
302
|
25
|
275
|
2
|
||||||||||||
Total
|
$
|
8,936
|
$
|
25
|
$
|
8,407
|
$
|
504
|
(1) |
Equity securities, which mainly comprise investments in comingled funds, are valued based on quoted prices and are primarily exchange-traded. Securities for which official close or last trade pricing on an active exchange is available are classified as Level 1 investments. If closing prices are not available, securities are valued at the last quoted bid price and typically are categorized as Level 2 investments.
|
(2) |
Debt securities: government bonds comprise fixed interest and index linked bonds issued by central governments, and are valued based on quotes received from independent pricing services or from dealers who make markets in such securities. Pricing services utilize pricing which considers readily available inputs such as the yield or price of bonds of comparable quality, coupon, maturity, and type, as well as dealer-supplied prices. Debt securities: government bonds are categorized as Level 2 investments.
|
(3) |
Debt securities: corporate bonds comprise bonds issued by corporations and are valued using recently executed transactions, or quoted market prices for similar assets and liabilities in active markets, or for identical assets and liabilities in markets that are not active. If there have been no market transactions in a particular fixed income security, its fair value is calculated by pricing models that benchmark the security against other securities with actual market prices. Debt securities: corporate bonds are categorized as Level 2 investments.
|
(4) |
Real estate comprises investments in certain property funds which themselves are valued based on the value of the underlying properties. These properties are valued using a number of standard industry techniques such as cost, discounted cash flows, independent appraisals and market based comparable data. Real estate investments are categorized as Level 3 investments. Change in Level 3 investments driven primarily by currency fluctuations.
|
(5) |
Other investments mainly comprise cash and cash equivalents and derivatives. Cash is categorized as a Level 1 investment. Cash equivalents are valued using observable yield curves, discounting and interest rates and are categorized as Level 2 investments. Derivatives which are exchange-traded and for which market quotations are readily available are valued at the last reported sale price or official closing price as reported by an independent pricing service on the primary market, or exchange on which they are traded, and are categorized as Level 1 investments. Over-the-counter derivatives typically are valued by independent pricing services and are categorized as Level 2 investments.
|
(6) |
Debt securities: other bonds comprise agency and mortgage-backed securities. These are valued using recently executed transactions and quoted market prices for similar assets and liabilities in active markets, or for identical assets and liabilities in markets that are not active. If there have been no market transactions in a particular fixed income security, its fair value is calculated by pricing models that benchmark the security against other securities with actual market prices. Debt securities: other bonds are categorized as Level 2 investments.
|
Boots and Other
Pension Plans
|
||||||||
2016
|
2015
(1)
|
|||||||
Service costs
|
$
|
4
|
$
|
3
|
||||
Interest costs
|
308
|
214
|
||||||
Expected returns on plan assets
|
(247
|
)
|
(173
|
)
|
||||
Curtailments
|
(2
|
)
|
(2
|
)
|
||||
Total net periodic pension costs
|
$
|
63
|
$
|
42
|
2016
|
2015
(1)
|
|||||||
Benefit obligation at beginning of year
|
$
|
8,635
|
$
|
8,827
|
||||
Service costs
|
4
|
3
|
||||||
Interest costs
|
308
|
214
|
||||||
Amendments
|
(2
|
)
|
(2
|
)
|
||||
Net actuarial (gain)
loss
|
2,272
|
(103
|
)
|
|||||
Benefits paid
|
(277
|
)
|
(186
|
)
|
||||
Currency translation adjustments
|
(1,477
|
)
|
(118
|
)
|
||||
Benefit obligation at end of year
|
$
|
9,463
|
$
|
8,635
|
2016
|
2015
(1)
|
|||||||
Plan assets at fair value at beginning of year
|
$
|
8,936
|
$
|
8,987
|
||||
Employer contributions
|
75
|
152
|
||||||
Benefits paid
|
(277
|
)
|
(186
|
)
|
||||
Return on assets
|
2,216
|
91
|
||||||
Currency translation adjustments
|
(1,522
|
)
|
(108
|
)
|
||||
Plan assets at fair value at end of year
|
$
|
9,428
|
$
|
8,936
|
2016
|
2015
|
|||||||
Other non-current assets
|
$
|
155
|
$
|
468
|
||||
Accrued expenses and other liabilities
|
(6
|
)
|
(
1
|
)
|
||||
Other non-current liabilities
|
(
184
|
)
|
(
166
|
)
|
||||
Net
(liability)
asset recognized at end of year
|
$
|
(35
|
)
|
$
|
301
|
2016
|
2015
(1)
|
|||||||
Net actuarial (gain) loss
|
(258
|
)
|
21
|
(1) |
Fiscal 2015 represents change in pension benefit obligation and plan assets from December 31, 2014 to August 31, 2015.
|
2016
|
2015
|
|||||||
Projected benefit obligation
|
$
|
9,463
|
$
|
8,635
|
||||
Accumulated benefit obligation
|
9,457
|
8,624
|
||||||
Fair value of plan assets
|
9,428
|
8,936
|
Estimated Future
Benefit Payments
|
||||
2017
|
$
|
264
|
||
2018
|
237
|
|||
2019
|
248
|
|||
2020
|
266
|
|||
2021
|
279
|
|||
2022-2026
|
1,641
|
2016
|
2015
|
|||||||
Weighted-average assumptions used to determine benefit obligations
|
||||||||
Discount rate
|
2.17
|
%
|
3.87
|
%
|
||||
Rate of compensation increase
|
2.44
|
%
|
2.55
|
%
|
||||
Weighted-average assumptions used to determine net periodic benefit cost
|
||||||||
Discount rate
|
3.87
|
%
|
3.77
|
%
|
||||
Expected long-term return on plan assets
|
3.05
|
%
|
2.99
|
%
|
||||
Rate of compensation increase
|
2.55
|
%
|
2.66
|
%
|
Pension/post
-retirement
obligations
|
Unrecognized
gain (loss) on
available-for-
sale
investments
|
Unrealized
gain (loss)
on cash
flow hedges
|
Share of
OCI of
equity
method
investments
|
Cumulative
translation
adjustments
|
Total
|
|||||||||||||||||||
Balance at August 31, 2013
|
$
|
63
|
$
|
1
|
$
|
-
|
$
|
(95
|
)
|
$
|
(61
|
)
|
$
|
(92
|
)
|
|||||||||
Other comprehensive income (loss) before reclassification adjustments
|
(77
|
)
|
170
|
(43
|
)
|
(27
|
)
|
330
|
353
|
|||||||||||||||
Tax benefit (provision)
|
29
|
(64
|
)
|
16
|
9
|
(115
|
)
|
(125
|
)
|
|||||||||||||||
Net other comprehensive income (loss)
|
(48
|
)
|
106
|
(27
|
)
|
(18
|
)
|
215
|
228
|
|||||||||||||||
Balance at August 31, 2014
|
$
|
15
|
$
|
107
|
$
|
(27
|
)
|
$
|
(113
|
)
|
$
|
154
|
$
|
136
|
||||||||||
Other comprehensive income (loss) before reclassification adjustments
|
23
|
247
|
(14
|
)
|
(57
|
)
|
(779
|
)
|
(580
|
)
|
||||||||||||||
Amounts reclassified from accumulated OCI
|
-
|
-
|
(5
|
)
|
230
|
80
|
305
|
|||||||||||||||||
Tax benefit (provision)
|
(9
|
)
|
(95
|
)
|
6
|
(60
|
)
|
83
|
(75
|
)
|
||||||||||||||
Net other comprehensive income (loss)
|
14
|
152
|
(13
|
)
|
113
|
(616
|
)
|
(350
|
)
|
|||||||||||||||
Balance at August 31, 2015
|
$
|
29
|
$
|
259
|
$
|
(40
|
)
|
$
|
-
|
$
|
(462
|
)
|
$
|
(214
|
)
|
|||||||||
Other comprehensive income (loss) before reclassification adjustments
|
(303
|
)
|
(148
|
)
|
-
|
(1
|
)
|
(2,279
|
)
|
(2,731
|
)
|
|||||||||||||
Amounts reclassified from accumulated OCI
|
-
|
(268
|
)
|
5
|
-
|
(3
|
)
|
(266
|
)
|
|||||||||||||||
Tax benefit (provision)
|
62
|
159
|
(2
|
)
|
-
|
-
|
219
|
|||||||||||||||||
Net other comprehensive income (loss)
|
(241
|
)
|
(257
|
)
|
3
|
(1
|
)
|
$
|
(2,282
|
)
|
(2,778
|
)
|
||||||||||||
Balance at August 31, 2016
|
$
|
(212
|
)
|
$
|
2
|
$
|
(37
|
)
|
$
|
(1
|
)
|
$
|
(2,744
|
)
|
$
|
(2,992
|
)
|
· |
The Retail Pharmacy USA segment consists of the legacy Walgreens business, which includes the operation of retail drugstores and convenient care clinics and the provision of specialty pharmacy services. Revenues for the segment are principally derived from the sale of prescription drugs and a wide assortment of general merchandise, including non-prescription drugs, beauty products, photo finishing, seasonal merchandise, greeting cards and convenience foods.
|
· |
The Retail Pharmacy International segment consists primarily of the legacy Alliance Boots pharmacy-led health and beauty stores, optical practices, and related contract manufacturing operations. Stores are located in the United Kingdom, Mexico, Chile, Thailand, Norway, the Republic of Ireland, The Netherlands and Lithuania. Revenues for the segment are principally derived from the sale of prescription drugs and retail health, beauty, toiletries and other consumer products.
|
· |
The Pharmaceutical Wholesale segment consists of the legacy Alliance Boots pharmaceutical wholesaling and distribution businesses and an equity method investment in AmerisourceBergen reported on a two-month lag. Wholesale operations are located in France, the United Kingdom, Germany, Turkey, Spain, The Netherlands, Egypt, Norway, Romania, Czech Republic and Lithuania. Revenues for the segment are principally derived from wholesaling and distribution of a comprehensive offering of brand-name pharmaceuticals (including specialty pharmaceutical products) and generic pharmaceuticals, health and beauty products, home healthcare supplies and equipment, and related services to pharmacies and other healthcare providers.
|
Retail Pharmacy
|
||||||||||||||||||||
USA
|
International
(1)
|
Pharmaceutical
Wholesale
|
Eliminations
(1)
|
Walgreens
Boots Alliance,
Inc.
|
||||||||||||||||
For the Year Ended August 31, 2016
|
||||||||||||||||||||
Sales to external customers
|
$
|
83,802
|
$
|
13,256
|
$
|
20,293
|
$
|
-
|
$
|
117,351
|
||||||||||
Intersegment sales
|
-
|
-
|
2,278
|
(2,278
|
)
|
-
|
||||||||||||||
Sales
|
$
|
83,802
|
$
|
13,256
|
$
|
22,571
|
$
|
(2,278
|
)
|
$
|
117,351
|
|||||||||
Adjusted Operating Income
|
$
|
5,357
|
$
|
1,155
|
$
|
708
|
$
|
(12
|
)
|
$
|
7,208
|
|||||||||
Depreciation and amortization
|
$
|
1,134
|
$
|
401
|
$
|
166
|
$
|
17
|
$
|
1,718
|
||||||||||
Additions to property, plant and equipment
|
777
|
444
|
104
|
-
|
1,325
|
|||||||||||||||
For the Year Ended August 31, 2015
|
||||||||||||||||||||
Sales to external customers
|
$
|
80,974
|
$
|
8,657
|
$
|
13,813
|
$
|
-
|
$
|
103,444
|
||||||||||
Intersegment sales
|
-
|
-
|
1,514
|
(1,514
|
)
|
-
|
||||||||||||||
Sales
|
$
|
80,974
|
$
|
8,657
|
$
|
15,327
|
$
|
(1,514
|
)
|
$
|
103,444
|
|||||||||
Adjusted Operating Income
|
$
|
5,098
|
$
|
616
|
$
|
450
|
$
|
(7
|
)
|
$
|
6,157
|
|||||||||
Depreciation and amortization
|
$
|
1,217
|
$
|
393
|
$
|
120
|
$
|
12
|
$
|
1,742
|
||||||||||
Additions to property, plant and equipment
|
951
|
249
|
51
|
-
|
1,251
|
|||||||||||||||
For the Year Ended August 31, 2014
|
||||||||||||||||||||
Sales to external customers
|
$
|
76,392
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
76,392
|
||||||||||
Intersegment sales
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||
Sales
|
$
|
76,392
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
76,392
|
||||||||||
Adjusted Operating Income
|
$
|
4,866
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
4,866
|
||||||||||
Depreciation and amortization
|
$
|
1,316
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
1,316
|
||||||||||
Additions to property, plant and equipment
|
1,106
|
-
|
-
|
-
|
1,106
|
(1) |
To improve comparability, certain classification changes have been made to fiscal 2015 Sales, Cost of sales and Selling, general and administrative expenses. This change has no impact on Operating Income.
|
Retail Pharmacy
|
||||||||||||||||||||
USA
|
International
|
Pharmaceutical
Wholesale
|
Eliminations
|
Walgreens
Boots
Alliance, Inc.
|
||||||||||||||||
For the Year Ended August 31, 2016
|
||||||||||||||||||||
Adjusted Operating Income
|
$
|
5,357
|
$
|
1,155
|
$
|
708
|
$
|
(12
|
)
|
$
|
7,208
|
|||||||||
Cost transformation
|
(424
|
)
|
||||||||||||||||||
Acquisition-related amortization
|
(369
|
)
|
||||||||||||||||||
LIFO provision
|
(214
|
)
|
||||||||||||||||||
Acquisition-related costs
|
(102
|
)
|
||||||||||||||||||
Legal settlement
|
(47
|
)
|
||||||||||||||||||
Asset impairment
|
(30
|
)
|
||||||||||||||||||
Adjustments to equity earnings in AmerisourceBergen
|
(21
|
)
|
||||||||||||||||||
Operating Income
|
$
|
6,001
|
||||||||||||||||||
For the Year Ended August 31, 2015
|
||||||||||||||||||||
Adjusted Operating Income
|
$
|
5,098
|
$
|
616
|
$
|
450
|
$
|
(7
|
)
|
$
|
6,157
|
|||||||||
Cost transformation
|
(542
|
)
|
||||||||||||||||||
Acquisition-related amortization
|
(485
|
)
|
||||||||||||||||||
LIFO provision
|
(285
|
)
|
||||||||||||||||||
Acquisition-related costs
|
(87
|
)
|
||||||||||||||||||
Asset impairment
|
(110
|
)
|
||||||||||||||||||
Store closures and other optimization costs
|
(56
|
)
|
||||||||||||||||||
(Loss
) on sale of business
|
(17
|
)
|
||||||||||||||||||
Adjustments to equity earnings in Alliance Boots
|
93
|
|||||||||||||||||||
Operating Income
|
$
|
4,668
|
||||||||||||||||||
For the Year Ended August 31, 2014
|
||||||||||||||||||||
Adjusted Operating Income
|
$
|
4,866
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
4,866
|
||||||||||
Acquisition-related amortization
|
(282
|
)
|
||||||||||||||||||
Acquisition-related costs
|
(82
|
) | ||||||||||||||||||
LIFO provision
|
(132
|
)
|
||||||||||||||||||
Store closures and other optimization costs
|
(271
|
)
|
||||||||||||||||||
Gain on sale of business
|
9
|
|||||||||||||||||||
Adjustments to equity earnings in Alliance Boots
|
86
|
|||||||||||||||||||
Operating Income
|
$
|
4,194
|
2016
|
2015
|
2014
|
||||||||||
United States
|
$
|
83,802
|
$
|
80,974
|
$
|
76,392
|
||||||
United Kingdom
|
14,081
|
9,235
|
-
|
|||||||||
Europe (excluding the United Kingdom)
|
16,793
|
11,402
|
-
|
|||||||||
Other
|
2,675
|
1,833
|
-
|
|||||||||
Sales
|
$
|
117,351
|
$
|
103,444
|
$
|
76,392
|
2016
|
2015
|
|||||||
United States
|
$
|
10,924
|
$
|
11,327
|
||||
United Kingdom
|
2,611
|
2,835
|
||||||
Europe (excluding the United Kingdom)
|
625
|
725
|
||||||
Other
|
175
|
181
|
||||||
Total long-lived assets
|
$
|
14,335
|
$
|
15,068
|
2016
|
2015
|
2014
|
||||||||||
Purchases, net
|
$
|
41,889
|
$
|
39,
360
|
$
|
31,439
|
||||||
|
||||||||||||
Trade accounts payable
, net
|
3,
456
|
2,
867
|
2,
360
|
2016
|
2015
|
|||||||
Accounts receivable
|
||||||||
Accounts receivable
|
$
|
6,426
|
$
|
7,021
|
||||
Allowance for doubtful accounts
|
(166
|
)
|
(172
|
)
|
||||
$
|
6,260
|
$
|
6,849
|
|||||
Other non-current assets
|
||||||||
Investment in AmerisourceBergen
|
$
|
-
|
$
|
1,147
|
||||
Warrants
|
-
|
2,140
|
||||||
Other
|
467
|
805
|
||||||
$
|
467
|
$
|
4,092
|
|||||
Accrued expenses and other liabilities
|
||||||||
Accrued salaries and wages
|
$
|
1,398
|
$
|
1,357
|
||||
Other
|
4,086
|
3,868
|
||||||
$
|
5,484
|
$
|
5,225
|
Quarter Ended
|
||||||||||||||||||||
November
|
February
|
May
|
August
|
Fiscal Year
|
||||||||||||||||
Fiscal 2016
(1)
|
||||||||||||||||||||
Sales
|
$
|
29,033
|
$
|
30,184
|
$
|
29,498
|
$
|
28,636
|
$
|
117,351
|
||||||||||
Gross Profit
|
7,419
|
7,867
|
7,433
|
7,155
|
29,874
|
|||||||||||||||
Net Earnings attributable to Walgreens Boots Alliance, Inc.
|
1,110
|
930
|
1,103
|
1,030
|
4,173
|
|||||||||||||||
Net earnings per common share:
|
||||||||||||||||||||
Basic
|
$
|
1.02
|
$
|
0.86
|
$
|
1.02
|
$
|
0.95
|
$
|
3.85
|
||||||||||
Diluted
|
1.01
|
0.85
|
1.01
|
0.95
|
3.82
|
|||||||||||||||
Cash Dividends Declared Per Common Share
|
$
|
0.3600
|
$
|
0.3600
|
$
|
0.3600
|
$
|
0.3750
|
$
|
1.4550
|
||||||||||
Fiscal 2015
(1)
|
||||||||||||||||||||
Sales
|
$
|
19,554
|
$
|
26,573
|
$
|
28,795
|
$
|
28,522
|
$
|
103,444
|
||||||||||
Gross Profit
|
5,296
|
6,842
|
7,420
|
7,195
|
26,753
|
|||||||||||||||
Net Earnings attributable to Walgreens Boots Alliance, Inc.
|
850
|
2,042
|
1,302
|
26
|
4,220
|
|||||||||||||||
Net earnings per common:
|
||||||||||||||||||||
Basic
|
$
|
0.90
|
$
|
1.96
|
$
|
1.19
|
$
|
0.02
|
$
|
4.05
|
||||||||||
Diluted
|
0.89
|
1.93
|
1.18
|
0.02
|
4.00
|
|||||||||||||||
Cash Dividends Declared Per Common Share
|
$
|
0.3375
|
$
|
0.3375
|
$
|
0.3375
|
$
|
0.3600
|
$
|
1.3725
|
(1) |
To improve comparability, certain classification changes have been made to fiscal 2016 for the quarterly periods ended November 30, 2015, February 29, 2016, and May 31, 2016 and
to fiscal 2015
for
the
quarterly periods
ended February 29, 2015, May 31, 2015, and August 31,
2015 to Sales, Cost of sales and Selling, general and administrative expenses. This change has no impact on Operating Income.
|
/s/
|
Stefano Pessina
|
/s/
|
George R. Fairweather
|
||
Stefano Pessina
|
George R. Fairweather
|
||||
Executive Vice Chairman and Chief
Executive Officer
|
Executive Vice President and Global Chief
Financial Officer
|
(a) |
Documents filed as part of this report:
|
(1) |
Financial statements.
The following financial statements, supplementary data, and reports of independent public accountants appear in Part II, Item 8 of this Form 10-K and are incorporated herein by reference.
|
(2) |
Financial statement schedules and supplementary information
|
(3) |
Exhibits.
Exhibits 10.1 through 10.66 constitute management contracts or compensatory plans or arrangements required to be filed as exhibits pursuant to Item 15(b) of this Form 10-K.
|
• |
should not in all instances be treated as categorical statements of fact, but rather as a way of allocating the risk to one of the parties if those statements prove to be inaccurate;
|
• |
may have been qualified by disclosures that were made to the other party in connection with the negotiation of the applicable agreement, which disclosures are not necessarily reflected in the agreement;
|
• |
may apply standards of materiality in a way that is different from what may be viewed as material to you or other investors; and
|
• |
were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement and are subject to more recent developments.
|
(b)
|
Exhibits
|
Exhibit
No.
|
Description
|
SEC Document Reference
|
|
2.1*
|
Purchase and Option Agreement by and among Walgreen Co., Alliance Boots GmbH and AB Acquisitions Holdings Limited dated June 18, 2012 and related annexes.
|
Incorporated by reference to Annex B-1 to the proxy statement/prospectus forming a part of the Registration Statement on Form S-4 (File No. 333-198768) filed with the SEC pursuant to Rule 424(b)(3) on November 24, 2014.
|
|
2.2*
|
Amendment No. 1, dated August 5, 2014, to the Purchase and Option Agreement and Walgreen Co. Shareholders Agreement, by and among Walgreen Co., Alliance Boots GmbH, AB Acquisitions Holdings Limited, Walgreen Scotland Investments LP, KKR Sprint (European II) Limited, KKR Sprint (2006) Limited and KKR Sprint (KPE) Limited, Alliance Santé Participations S.A., Stefano Pessina and Kohlberg Kravis Roberts & Co. L.P.
|
Incorporated by reference to Annex B-2 to the proxy statement/prospectus forming a part of the Registration Statement on Form S-4 (File No. 333-198768) filed with the SEC pursuant to Rule 424(b)(3) on November 24, 2014.
|
|
2.3
|
Reorganization Agreement and Plan of Merger, dated October 17, 2014, by and among Walgreen Co., Walgreens Boots Alliance, Inc. and Ontario Merger Sub, Inc.
|
Incorporated by reference to Annex A to the proxy statement/prospectus forming a part of the Registration Statement on Form S-4 (File No. 333-198768) filed with the SEC pursuant to Rule 424(b)(3) on November 24, 2014.
|
|
2.4
|
Amendment No. 1, dated December 23, 2014, to the Reorganization Agreement and Plan of Merger, dated October 17, 2014, by and among Walgreen Co., Walgreens Boots Alliance, Inc. and Ontario Merger Sub, Inc.
|
Incorporated by reference to Exhibit 2.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 1-36759) filed with the SEC on December 24, 2014.
|
|
2.5
|
Amendment No. 2, dated December 29, 2014, to the Reorganization Agreement and Plan of Merger, dated October 17, 2014, as amended December 23, 2014, by and among Walgreen Co., Walgreens Boots Alliance, Inc. and Ontario Merger Sub, Inc.
|
Incorporated by reference to Exhibit 2.3 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2014 (File No. 1-36759) filed with the SEC on December 30, 2014.
|
|
2.6*
|
Agreement and Plan of Merger, dated as of October 27, 2015, by and among Walgreens Boots Alliance, Inc., Victoria Merger Sub, Inc. and Rite Aid Corporation.
|
Incorporated by reference to Exhibit 2.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 001-36759) filed with the SEC on October 29, 2015.
|
|
3.1
|
Amended and Restated Certificate of Incorporation of Walgreens Boots Alliance, Inc.
|
Incorporated by reference to Exhibit 3.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K12B (File No. 1-36759) filed with the SEC on December 31, 2014.
|
|
3.2
|
Amended and Restated Bylaws of Walgreens Boots Alliance, Inc.
|
Incorporated by reference to Exhibit 3.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 1-36759) filed with the SEC on June 10, 2016.
|
4.1**
|
Indenture, dated as of July 17, 2008, between Walgreen Co. and Wells Fargo Bank, National Association, as trustee.
|
Incorporated by reference to Exhibit 4.1 to Walgreen Co.’s registration statement on Form S-3ASR (File No. 333-198443) filed with the SEC on September 16, 2014.
|
|
4.2
|
Form of Walgreen Co. 5.25% Note due 2019.
|
Incorporated by reference to Exhibit 4.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on January 13, 2009.
|
|
4.3
|
Form of Walgreen Co. 3.100% Note due 2022.
|
Incorporated by reference to Exhibit 4.4 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on September 13, 2012.
|
|
4.4
|
Form of Walgreen Co. 4.400% Note due 2042.
|
Incorporated by reference to Exhibit 4.5 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on September 13, 2012.
|
|
4.5
|
Form of Guarantee of Walgreens Boots Alliance, Inc.
|
Incorporated by reference to Exhibit 4.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K12B (File No. 1-36759) filed with the SEC on December 31, 2014.
|
|
4.6
|
Indenture dated November 18, 2014 among Walgreens Boots Alliance, Inc. and Wells Fargo Bank, National Association, as trustee.
|
Incorporated by reference to Exhibit 4.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 18, 2014.
|
|
4.7
|
Form of 1.750% Notes due 2017.
|
Incorporated by reference to Exhibit 4.3 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 18, 2014.
|
|
4.8
|
Form of 2.700% Notes due 2019.
|
Incorporated by reference to Exhibit 4.4 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 18, 2014.
|
|
4.9
|
Form of 3.300% Notes due 2021.
|
Incorporated by reference to Exhibit 4.5 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 18, 2014.
|
|
4.10
|
Form of 3.800% Notes due 2024.
|
Incorporated by reference to Exhibit 4.6 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 18, 2014.
|
|
4.11
|
Form of 4.500% Notes due 2034.
|
Incorporated by reference to Exhibit 4.7 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 18, 2014.
|
|
4.12
|
Form of 4.800% Notes due 2044.
|
Incorporated by reference to Exhibit 4.8 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 18, 2014.
|
|
4.13
|
Form of 2.875% Notes due 2020 (£).
|
Incorporated by reference to Exhibit 4.2 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 20, 2014.
|
|
4.14
|
Form of 3.600% Notes due 2025 (£).
|
Incorporated by reference to Exhibit 4.3 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 20, 2014.
|
|
4.15
|
Form of 2.125% Notes due 2026 (€).
|
Incorporated by reference to Exhibit 4.4 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 20, 2014.
|
|
4.16
|
Indenture, dated as of December 17, 2015, between Walgreens Boots Alliance, Inc. and Wells Fargo Bank, National Association, as trustee
|
Incorporated by reference to Exhibit 4.1 to the Registration Statement on Form S-3 (File No. 333-208587) filed with the SEC on December 17, 2015.
|
4.17
|
Form of 1.750% Notes due 2018
|
Incorporated by reference to Exhibit 4.2 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 1-36759) filed with the SEC on June 1, 2016.
|
|
4.18
|
Form of 2.600% Notes due 2021
|
Incorporated by reference to Exhibit 4.3 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 1-36759) filed with the SEC on June 1, 2016.
|
|
4.19
|
Form of 3.100% Notes due 2023
|
Incorporated by reference to Exhibit 4.4 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 1-36759) filed with the SEC on June 1, 2016.
|
|
4.20
|
Form of 3.450% Notes due 2026
|
Incorporated by reference to Exhibit 4.5 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 1-36759) filed with the SEC on June 1, 2016.
|
|
4.21
|
Form of 4.650% Notes due 2046
|
Incorporated by reference to Exhibit 4.6 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 1-36759) filed with the SEC on June 1, 2016.
|
|
4.22
|
Shareholders Agreement, dated as of August 2, 2012, among Walgreen Co., Stefano Pessina, KKR Sprint (European II) Limited, KKR Sprint (2006) Limited and KKR Sprint (KPE) Limited, Alliance Santé Participations S.A., Kohlberg Kravis Roberts & Co. L.P. and certain other investors party thereto.
|
Incorporated by reference to Exhibit 4.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on August 6, 2012.
|
|
4.23
|
Amendment No. 1, dated August 5, 2014, to the Purchase and Option Agreement and Walgreen Co. Shareholders Agreement, by and among Walgreen Co., Alliance Boots GmbH, AB Acquisitions Holdings Limited, Walgreen Scotland Investments LP, KKR Sprint (European II) Limited, KKR Sprint (2006) Limited and KKR Sprint (KPE) Limited, Alliance Santé Participations S.A., Stefano Pessina and Kohlberg Kravis Roberts & Co. L.P.
|
Incorporated by reference to Annex B-2 to the proxy statement/prospectus forming a part of the Registration Statement on Form S-4 (File No. 333-198768) filed with the SEC pursuant to Rule 424(b)(3) on November 24, 2014.
|
|
4.24
|
Amendment No. 2, dated December 31, 2014, to the Purchase and Option Agreement and Walgreen Co. Shareholders Agreement, as Amended by Amendment No. 1, dated as of August 5, 2014, by and among Walgreen Co., Alliance Boots GmbH, AB Acquisitions Holdings Limited, Ontario Holdings WBS Limited, KKR Sprint (European II) Limited, KKR Sprint (2006) Limited and KKR Sprint (KPE) Limited, Alliance Santé Participations S.A., Stefano Pessina and Kohlberg Kravis Roberts & Co. L.P.
|
Incorporated by reference to Exhibit E to the Schedule 13D filed by Alliance Santé Participations S.A. (File No. 005-88481) filed with the SEC on December 31, 2014).
|
|
10.1
|
Walgreens Boots Alliance, Inc. Management Incentive Plan (as amended and restated effective December 31, 2014).
|
Incorporated by reference to Exhibit 10.6 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K12B (File No. 1-36759) filed with the SEC on December 31, 2014.
|
|
10.2
|
Walgreens Boots Alliance, Inc. Management Incentive Plan (as amended and restated effective July 1, 2016).
|
Filed herewith.
|
|
10.3
|
Walgreens Boots Alliance, Inc. 2011 Cash-Based Incentive Plan (as amended and restated effective December 31, 2014).
|
Incorporated by reference to Exhibit 10.5 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K12B (File No. 1-36759) filed with the SEC on December 31, 2014.
|
10.4
|
Walgreens Boots Alliance, Inc. 2011 Cash-Based Incentive Plan (as amended and restated effective July 1, 2016).
|
Filed herewith.
|
|
10.5
|
Walgreens Boots Alliance, Inc. 2013 Omnibus Incentive Plan (as amended and restated effective July 8, 2015).
|
Incorporated by reference to Exhibit 10.3 to Walgreens Boots Alliance, Inc.’s Annual Report on Form 10-K (File No. 1-36759) filed with the SEC on October 28, 2015.
|
|
10.6
|
Form of Restricted Stock Unit Award agreement (effective January 2015).
|
Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 1-36759) filed with the SEC on January 21, 2015.
|
|
10.7
|
Form of Performance Share Award agreement (effective October 2015).
|
Incorporated by reference to Exhibit 10.5 to Walgreens Boots Alliance, Inc.’s Annual Report on Form 10-K (File No. 1-36759) filed with the SEC on October 28, 2015.
|
|
10.8
|
Form of Stock Option Award agreement (effective July 2016).
|
Filed herewith.
|
|
10.9
|
Form of Stock Option Award agreement (effective October 2015).
|
Incorporated by reference to Exhibit 10.6 to Walgreens Boots Alliance, Inc.’s Annual Report on Form 10-K (File No. 1-36759) filed with the SEC on October 28, 2015.
|
|
10.10
|
Form of Performance Share Award agreement for CEO (February 2016).
|
Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 29, 2016 (File No. 1-36759) filed with the SEC on April 5, 2016.
|
|
10.11
|
Form of Stock Option Award agreement for CEO (February 2016).
|
Incorporated by reference to Exhibit 10.2 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 29, 2016 (File No. 1-36759) filed with the SEC on April 5, 2016.
|
|
10.12
|
Form of Restricted Stock Unit Award agreement for Executive Chairman (February 2016).
|
Incorporated by reference to Exhibit 10.3 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 29, 2016 (File No. 1-36759) filed with the SEC on April 5, 2016.
|
|
10.13
|
Form of Restricted Stock Unit Agreement (Messrs. Skinner and Pessina).
|
Incorporated by reference to Exhibit 10.6 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
|
10.14
|
Form of Restricted Stock Unit Award agreement (effective July 2014).
|
Incorporated by reference to Exhibit 10.3 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on August 8, 2014.
|
|
10.15
|
Form of Performance Share Award agreement (effective July 2014).
|
Incorporated by reference to Exhibit 10.4 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on August 8, 2014.
|
|
10.16
|
Form of Stock Option Award agreement (effective July 2014).
|
Incorporated by reference to Exhibit 10.5 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on August 8, 2014.
|
10.17
|
Forms of Restricted Stock Unit Award agreement (effective October 2013).
|
Incorporated by reference to Exhibit 10.4 to Walgreen Co.’s Annual Report on Form 10-K for the fiscal year ended August 31, 2013 (File No. 1-00604).
|
|
10.18
|
Form of Performance Share Award agreement (effective January 10, 2013).
|
Incorporated by reference to Exhibit 10.3 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on January 14, 2013.
|
|
10.19
|
Form of Stock Option Award agreement (effective January 10, 2013).
|
Incorporated by reference to Exhibit 10.4 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on January 14, 2013.
|
|
10.20
|
Form of Amendment to Stock Option Award agreements.
|
Incorporated by reference to Exhibit 10.11 to Walgreen Co.’s Annual Report on Form 10-K for the fiscal year ended August 31, 2014 (File No. 1-00604) filed with the SEC on October 20, 2014.
|
|
10.21
|
UK Sub-Plan under the Walgreens Boots Alliance, Inc. 2013 Omnibus Incentive Plan.
|
Incorporated by reference to Exhibit 10.16 to Walgreens Boots Alliance, Inc.’s Annual Report on Form 10-K (File No. 1-36759) filed with the SEC on October 28, 2015.
|
|
10.22
|
Form of Stock Option Award agreement under UK Sub-plan (effective October 2015).
|
Incorporated by reference to Exhibit 10.17 to Walgreens Boots Alliance, Inc.’s Annual Report on Form 10-K (File No. 1-36759) filed with the SEC on October 28, 2015.
|
|
10.23
|
Form of Stock Option Award agreement under UK Sub-plan (effective July 2016).
|
Filed herewith.
|
|
10.24
|
Walgreen Co. Long-Term Performance Incentive Plan (amendment and restatement of the Walgreen Co. Restricted Performance Share Plan).
|
Incorporated by reference to Exhibit 10.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on January 11, 2007.
|
|
10.25
|
Walgreen Co. Long-Term Performance Incentive Plan Amendment No. 1 (effective January 10, 2007).
|
Incorporated by reference to Exhibit 10.2 to Walgreen Co.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2007 (File No. 1-00604).
|
|
10.26
|
Walgreen Co. Long-Term Performance Incentive Plan Amendment No. 2.
|
Incorporated by reference to Exhibit 10.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on April 14, 2011.
|
|
10.27
|
Form of Restricted Stock Unit Award Agreement (August 15, 2011 grants).
|
Incorporated by reference to Exhibit 10.5 to Walgreen Co.’s Annual Report on Form 10-K for the fiscal year ended August 31, 2011 (File No. 1-00604).
|
|
10.28
|
Walgreen Co. Executive Stock Option Plan (as amended and restated effective January 13, 2010).
|
Incorporated by reference to Exhibit 99.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on January 20, 2010.
|
|
10.29
|
Form of Stock Option Agreement (Benefit Indicator 512—515) (effective September 1, 2011).
|
Incorporated by reference to Exhibit 10.11 to Walgreen Co.’s Annual Report on Form 10-K for the fiscal year ended August 31, 2011 (File No. 1-00604).
|
|
10.30
|
Form of Stock Option Agreement (Benefit Indicator 516 and above) (effective September 1, 2011).
|
Incorporated by reference to Exhibit 10.12 to Walgreen Co.’s Annual Report on Form 10-K for the fiscal year ended August 31, 2011 (File No. 1-00604).
|
|
10.31
|
Walgreen Co. 2002 Executive Deferred Compensation/Capital Accumulation Plan.
|
Incorporated by reference to Exhibit 10(g) to Walgreen Co.’s Annual Report on Form 10-K for the fiscal year ended August 31, 2002 (File No. 1-00604).
|
10.32
|
Amendment to the Walgreen Co. 2002 et. al. Executive Deferred Compensation/ Capital Accumulation Plans.
|
Incorporated by reference to Exhibit 10.3 to Walgreen Co.’s Quarterly Report on Form 10-Q for the fiscal quarter ended February 28, 2009 (File No. 1-00604).
|
|
10.33
|
Walgreen Co. 2006 Executive Deferred Compensation/Capital Accumulation Plan (effective January 1, 2006).
|
Incorporated by reference to Exhibit 10(b) to Walgreen Co.’s Quarterly Report on Form 10-Q for the fiscal quarter ended November 30, 2005 (File No. 1-00604).
|
|
10.34
|
Walgreen Co. 2011 Executive Deferred Compensation Plan.
|
Incorporated by reference to Exhibit 10.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 12, 2010.
|
|
10.35
|
Amendment No. 1 to the Walgreen Co. 2011 Executive Deferred Compensation Plan.
|
Incorporated by reference to Exhibit 10.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on January 19, 2011.
|
|
10.36
|
Walgreens Boots Alliance, Inc. Executive Deferred Profit-Sharing Plan (as amended and restated effective December 31, 2014).
|
Incorporated by reference to Exhibit 10.3 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K12B (File No. 1-36759) filed with the SEC on December 31, 2014.
|
|
10.37
|
Share Walgreens Stock Purchase/Option Plan (effective October 1, 1992), as amended.
|
Incorporated by reference to Exhibit 10(d) to Walgreen Co.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2003 (File No. 1-00604).
|
|
10.38
|
Share Walgreens Stock Purchase/Option Plan Amendment No. 4 (effective July 15, 2005), as amended.
|
Incorporated by reference to Exhibit 10(h)(ii) to Walgreen Co.’s Annual Report on Form 10-K for the fiscal year ended August 31, 2005 (File No. 1-00604).
|
|
10.39
|
Share Walgreens Stock Purchase/Option Plan Amendment No. 5 (effective October 11, 2006).
|
Incorporated by reference to Exhibit 10(b) to Walgreen Co.’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2006 (File No. 1-00604).
|
|
10.40
|
Walgreen Select Senior Executive Retiree Medical Expense Plan.
|
Incorporated by reference to Exhibit 10(j) to Walgreen Co.’s Annual Report on Form 10-K for the fiscal year ended August 31, 1996 (File No. 1-00604).
|
|
10.41
|
Walgreen Select Senior Executive Retiree Medical Expense Plan Amendment No. 1 (effective August 1, 2002).
|
Incorporated by reference to Exhibit 10(a) to Walgreen Co.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2003 (File No. 1-00604).
|
|
10.42
|
Walgreens Boots Alliance, Inc. Executive Severance and Change in Control Plan (as amended and restated effective December 31, 2014).
|
Incorporated by reference to Exhibit 10.4 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K12B (File No. 1-36759) filed with the SEC on December 31, 2014.
|
|
10.43
|
Rules of the Alliance Boots 2012 Long Term Incentive Plan, as amended.
|
Incorporated by reference to Exhibit 10.11 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
|
10.44
|
Form of Award Agreement for Alliance Boots 2012 Long Term Incentive Plan.
|
Incorporated by reference to Exhibit 10.12 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
|
10.45
|
Offer Letter agreement between Stefano Pessina and Walgreens Boots Alliance, Inc.
|
Incorporated by reference to Exhibit 10.29 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
10.46
|
Employment Agreement between Alliance UniChem Plc and George Fairweather, dated March 28, 2002.
|
Incorporated by reference to Exhibit 10.14 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
|
10.47
|
Agreement between Alliance Boots plc and George Fairweather, dated July 31, 2006.
|
Incorporated by reference to Exhibit 10.15 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
|
10.48
|
Corporate Travel and Expense Support letter Agreement between Walgreens Boots Alliance, Inc. and George Fairweather, dated October 28, 2015.
|
Incorporated by reference to Exhibit 10.54 to Walgreens Boots Alliance, Inc.’s Annual Report on Form 10-K (File No. 1-36759) filed with the SEC on October 28, 2015.
|
|
10.49
|
Employment Agreement between Alliance UniChem Services Limited and Marco Pagni, dated June 1, 2005.
|
Incorporated by reference to Exhibit 10.16 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
|
10.50
|
Letter Agreement with Marco Pagni, dated May 14, 2012.
|
Incorporated by reference to Exhibit 10.17 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
|
10.51
|
Corporate Travel and Expense Support letter Agreement between Walgreens Boots Alliance, Inc. and Marco Pagni, dated October 28, 2015.
|
Incorporated by reference to Exhibit 10.57 to Walgreens Boots Alliance, Inc.’s Annual Report on Form 10-K (File No. 1-36759) filed with the SEC on October 28, 2015.
|
|
10.52
|
Service Agreement between Boots UK Limited and Alex Gourlay, dated January 29, 2009.
|
Incorporated by reference to Exhibit 10.18 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
|
10.53
|
Letter Agreement between Alliance Boots Management Services Limited and Alex Gourlay, dated June 28, 2010.
|
Incorporated by reference to Exhibit 10.19 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
|
10.54
|
Employment Agreement between Alliance UniChem Plc and Ornella Barra dated December 10, 2002.
|
Incorporated by reference to Exhibit 10.20 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
|
10.55
|
Agreement among Alliance Boots plc, Alliance UniChem Plc and Ornella Barra, dated July 31, 2006.
|
Incorporated by reference to Exhibit 10.21 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
|
10.56
|
Novation of Services Agreement among Alliance Boots Holdings Limited, Alliance Boots Management Services MC S.A.M and Ornella Barra, dated June 1, 2013.
|
Incorporated by reference to Exhibit 10.22 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
|
10.57
|
Service Agreement between Boots Management Services Limited and Simon Roberts, dated July 11, 2013.
|
Incorporated by reference to Exhibit 10.23 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
10.58
|
Services Agreement between Boots Management Services Limited and Ken Murphy, dated October 1, 2013.
|
Incorporated by reference to Exhibit 10.24 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (File No. 1-36759) filed with the SEC on April 9, 2015.
|
|
10.59
|
drugstore.com, inc., 1998 Stock Plan, as amended.
|
Incorporated by reference to Exhibit 99.1 to Walgreen Co.’s Registration Statement on Form S-8
(File No. 333-174811) filed with the SEC on June 9, 2011.
|
|
10.60
|
drugstore.com, inc., 2008 Equity Incentive Plan, as amended.
|
Incorporated by reference to Exhibit 99.2 to Walgreen Co.’s Registration Statement on Form S-8
(File No. 333-174811) filed with the SEC on June 9, 2011.
|
|
10.61
|
Walgreens Boots Alliance, Inc. Long-Term Global Assignment Relocation Policy
|
Incorporated by reference to Exhibit 10.68 to Walgreens Boots Alliance, Inc.’s Annual Report on Form 10-K (File No. 1-36759) filed with the SEC on October 28, 2015.
|
|
10.62
|
Secondment Agreement dated September 27, 2013 between Alliance Boots Management Services Limited and Walgreen Co.
|
Incorporated by reference to Exhibit 10.52 to Walgreen Co.’s Annual Report on Form 10-K for the fiscal year ended August 31, 2013 (File No. 1-00604).
|
|
10.63
|
Assignment Letter dated September 27, 2013 between Alexander Gourlay and Alliance Boots Management Services Ltd.
|
Incorporated by reference to Exhibit 10.53 to Walgreen Co.’s Annual Report on Form 10-K for the fiscal year ended August 31, 2013 (File No. 1-00604).
|
|
10.64
|
Extension, dated January 27, 2016, to Assignment Letter between Alexander Gourlay and Walgreens Boots Alliance Services Limited (formerly Alliance Boots Management Services Ltd.).
|
Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 1-36759) filed with the SEC on February 1, 2016.
|
|
10.65
|
Offer letter agreement between Kimberly R. Scardino and Walgreens Boots Alliance, Inc.
|
Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 1-36759) filed with the SEC on August 4, 2015.
|
|
10.66
|
Letter agreement dated September 23, 2016 between Simon Roberts and Walgreens Boots Alliance, Inc.
|
Filed herewith.
|
|
10.67
|
Shareholders’ Agreement, dated as of August 2, 2012, by and among Alliance Boots GmbH, AB Acquisition Holdings Limited and Walgreen Co.
|
Incorporated by reference to Exhibit 10.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on August 6, 2012.
|
|
10.68
|
Framework Agreement, dated as of March 18, 2013, by and among Walgreen Co., Alliance Boots GmbH and AmerisourceBergen Corporation, including as Annex B-1 thereto, the form of Warrant 1 and, as Annex B-2 thereto, the form of Warrant 2.
|
Incorporated by reference to Exhibit 10.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on March 20, 2013.
|
|
10.69
|
Amendment No. 1 dated August 25, 2016 to Warrant 2 issued on March 18, 2013.
|
Incorporated by reference to Exhibits 4.1 and 4.2 to AmerisourceBergen Corporation’s Current Report on Form 8-K (File No. 001-16671), filed on August 25, 2016 and incorporated by reference herein.
|
|
10.70
|
Shareholders Agreement, dated as of March 18, 2013, by and among Walgreen Co., Alliance Boots GmbH and AmerisourceBergen Corporation.
|
Incorporated by reference to Exhibit 10.2 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on March 20, 2013.
|
|
10.71
|
Term Loan Credit Agreement, dated as of November 10, 2014, among Walgreen Co., Walgreens Boots Alliance, Inc., the lenders from time to time party thereto, and Bank of America, N.A., as administrative agent.
|
Incorporated by reference to Exhibit 10.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 12, 2014.
|
10.72
|
Revolving Credit Agreement, dated as of November 10, 2014, among Walgreen Co., Walgreens Boots Alliance, Inc., the lenders from time to time party thereto and Bank of America, N.A., as administrative agent.
|
Incorporated by reference to Exhibit 10.2 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on November 12, 2014.
|
|
10.73
|
Bridge Term Loan Credit Agreement, dated as of December 18, 2015, by and among Walgreens Boots Alliance, Inc., the lenders from time to time party thereto and UBS AG, Stamford Branch, as administrative agent.
|
Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 001-36759) filed with the SEC on December 21, 2015.
|
|
10.74
|
Amendment, dated as of January 20, 2016, to the Bridge Term Loan Credit Agreement dated as of December 18, 2015, by and among Walgreens Boots Alliance, Inc., the lenders from time to time party thereto and UBS AG, Stamford Branch, as administrative agent.
|
Incorporated by reference to Exhibit 10.7 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 29, 2016 (File No. 1-36759) filed with the SEC on April 5, 2016.
|
|
10.75
|
Term Loan Credit Agreement, dated as of December 18, 2015, by and among Walgreens Boots Alliance, Inc., the lenders from time to time party thereto and Bank of America, N.A., as administrative agent.
|
Incorporated by reference to Exhibit 10.2 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 001-36759) filed with the SEC on December 21, 2015.
|
|
10.76
|
Amendment, dated as of January 20, 2016, to the Term Loan Credit Agreement, dated as of December 18, 2015, by and among Walgreens Boots Alliance, Inc., the lenders from time to time party thereto and Bank of America, N.A., as administrative agent.
|
Incorporated by reference to Exhibit 10.9 to Walgreens Boots Alliance, Inc.’s Quarterly Report on Form 10-Q for the quarter ended February 29, 2016 (File No. 1-36759) filed with the SEC on April 5, 2016.
|
|
10.77
|
Term Loan Credit Agreement, dated August 30, 2016, by and between Walgreens Boots Alliance, Inc. and Sumitomo Mitsui Banking Corporation, as lender and administrative agent.
|
Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.’s Current Report on Form 8-K (File No. 001-36759) filed with the SEC on August 31, 2016.
|
|
12.
|
Computation of Ratio of Earnings to Fixed Charges.
|
Filed herewith.
|
|
21.
|
Subsidiaries of the Registrant.
|
Filed herewith.
|
|
23.1
|
Consent of Deloitte & Touche LLP.
|
Filed herewith.
|
|
23.2
|
Consent of KPMG LLP.
|
Filed herewith.
|
|
23.3
|
Consent of KPMG LLP.
|
Filed herewith.
|
|
31.1
|
Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
Filed herewith.
|
|
31.2
|
Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
Filed herewith.
|
|
32.1
|
Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350.
|
Furnished herewith.
|
|
32.2
|
Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350.
|
Furnished herewith.
|
|
99.1
|
Alliance Boots GmbH audited consolidated financial statements comprised of the Group statements of financial position at March 31, 2014 and 2013, and the related Group income statements, Group statements of comprehensive income, Group statements of changes in equity and Group statements of cash flows for each of the years in the three-year period ended March 31, 2014.
|
Incorporated by reference to Exhibit 99.1 to Walgreen Co.’s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on May 15, 2014.
|
99.2
|
Alliance Boots GmbH interim condensed consolidated financial statements comprised of the Group interim consolidated condensed statement of financial position at December 31, 2014 and 2013, and the related Group interim consolidated condensed income statement, Group interim consolidated condensed statement of comprehensive income, Group interim consolidated condensed statement of changes in equity and Group interim consolidated condensed statement of cash flows for each of the nine month periods then ended.
|
Incorporated by reference to Exhibit 99.2 to Walgreens Boots Alliance, Inc.’s Annual Report on Form 10-K for the fiscal year ended August 31, 2015 (File No. 1-36759) filed with the SEC on October 28, 2015.
|
|
101.INS
|
XBRL Instance Document
|
Filed herewith.
|
|
101.SCH
|
XBRL Taxonomy Extension Schema Document
|
Filed herewith.
|
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
Filed herewith.
|
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document
|
Filed herewith.
|
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document
|
Filed herewith.
|
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
Filed herewith.
|
* |
Schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K. Copies of any omitted schedule or exhibit will be furnished supplementally to the SEC upon request.
|
** |
Other instruments defining the rights of holders of long-term debt of the registrant and its consolidated subsidiaries may be omitted from Exhibit 4 in accordance with Item 601(b)(4)(iii)(A) of Regulation S-K. Copies of any such agreements will be furnished supplementally to the SEC upon request.
|
WALGREENS BOOTS ALLIANCE, INC.
|
|||
October 20, 2016
|
By:
|
/s/ George R. Fairweather
|
|
George R. Fairweather
|
|||
Executive Vice President and Global Chief Financial Officer
|
Name
|
Title
|
Date
|
||
/s/ Stefano Pessina
|
Executive Vice Chairman and Chief
|
October 20, 2016
|
||
Stefano Pessina
|
Executive Officer (Principal Executive Officer) and Director
|
|||
/s/ George R. Fairweather
|
Executive Vice President and Global
|
October 20, 2016
|
||
George R. Fairweather
|
Chief Financial Officer (Principal Financial Officer)
|
|||
/s/ Kimberly R. Scardino
|
Senior Vice President, Global Controller
|
October 20, 2016
|
||
Kimberly R. Scardino
|
and Chief Accounting Officer (Principal Accounting Officer)
|
|||
/s/ James A. Skinner
|
Executive Chairman
|
October 20, 2016
|
||
James A. Skinner
|
||||
/s/ Janice M. Babiak
|
Director
|
October 20, 2016
|
||
Janice M. Babiak
|
||||
/s/ David J. Brailer
|
Director
|
October 20, 2016
|
||
David J. Brailer
|
||||
/s/ William C. Foote
|
Director
|
October 20, 2016
|
||
William C. Foote
|
||||
/s/ Ginger L. Graham
|
Director
|
October 20, 2016
|
||
Ginger L. Graham
|
||||
/s/ John A. Lederer
|
Director
|
October 20, 2016
|
||
John A. Lederer
|
||||
/s/ Dominic P. Murphy
|
Director
|
October 20, 2016
|
||
Dominic P. Murphy
|
||||
/s/ Leonard D. Schaeffer
|
Director
|
October 20, 2016
|
||
Leonard D. Schaeffer
|
||||
/s/ Nancy M. Schlichting
|
Director
|
October 20, 2016
|
||
Nancy M. Schlichting
|
1. |
Purpose
: The purpose of the Plan is to provide special incentive and motivation to eligible employees through annual bonuses.
|
2. |
Definitions
: Whenever used in the Plan, the following terms shall have the meanings set forth below, unless the context clearly provides otherwise:
|
a. |
The term "Base Salary" shall mean, (i) for U.S. Participants the hourly or salaried base compensation paid during the fiscal year, and any such base salary earned but deferred or reduced pursuant to a Company Section 401(k) plan, or Section 125 plan, or another Company deferral plan, but excluding any incentive or other bonuses, stock purchase discounts, or other fringe benefits or supplementary remuneration; and (ii) for non-U.S. Participants, bonus-eligible base compensation, as defined by Local Rules.
|
b. |
The term "Committee" shall mean the Compensation Committee of the Board of Directors of the Company.
|
c. |
The term "Company" shall mean Walgreens Boots Alliance, Inc., a Delaware corporation, and, as applicable, subsidiaries and affiliates of Walgreens Boots Alliance, Inc. whose employees are eligible to participate in the Plan.
|
d. |
The term “Disability” shall mean total disability as determined by the Committee, consistent with how the Company determines whether termination of employment is upon disability for other benefit plan purposes, and such determination may vary based on Local Rules.
|
e. |
The term "Employee" shall mean any employee of the Company, including, but not limited to, the officers of Walgreens Boots Alliance, Inc. Employee shall not include any person who is not classified as an employee in the common law sense in the records of the Company, even if those records are subsequently determined to have been in error or the person is subsequently reclassified as an employee. For example, no person shall be considered to be an Employee for any period of time during which he or she: (1) is a leased employee; (2) is an independent contractor; or (3) is otherwise not classified as an employee in the records of the Company.
|
f. |
The term "Extraordinary Items" shall mean significant transactions that are different from the typical or customary business transactions and are not expected to occur frequently as determined by the informed professional judgment of the Chief Financial Officer of the Company after taking into consideration all the facts involved in a particular situation and the objectives of the Plan.
|
g. |
The term "Individual Adjustment" shall mean the amount of any increase or reduction in the bonus share that would otherwise be allocated to a Participant; or shall mean any separate individual performance bonus component, as applicable.
|
h. |
The term “Local Rules” shall mean terms and conditions of the Plan applied on a customized basis to all or portions of non-U.S. Participants based on country-specific rules and/or business unit specific rules or practices, as defined, documented and administered at the local business unit level.
|
i. |
The term "Participant" shall mean any Employee who participates in and is eligible to receive incentive compensation pursuant to paragraph 3 of the Plan.
|
j. |
The term "Plan Year" shall mean the fiscal year of Walgreens Boots Alliance, Inc., which runs from September 1 to the following August 31, or such other 12-month period as may be designated by the Committee.
|
k. |
The term “Retirement” shall mean termination of employment from the Company in good standing, as determined by the Committee or its delegates, and after having attained at least age 55 and at least 10 years of continuous service; or as may otherwise be defined based on Local Rules.
|
3. |
Eligibility and Participation
: The Committee shall have the authority and discretion to determine the class or classes of Employees eligible to participate in the Plan for any Plan Year. As of the effective date of this amended and restated Plan, the following categories of Employees shall be eligible to participate in the Plan:
|
a. |
Any Walgreens U.S. Employee whose job position is within the Analysis pay band and above or its equivalent and is not covered by another Company management incentive plan;
|
b. |
Any non-U.S. Employee of the Company whose position is in the Company’s executive level 7 (or its equivalent) or above; and
|
c. |
Any other Employee who is approved for participation by the Committee, based on the recommendation of Company management that he or she is in a position to make a substantial contribution to the success of the Company by exceptional service in a supervisory or staff position.
|
4. |
Determination of Bonuses
: Participant bonuses for each Plan Year shall be determined as follows:
|
a. |
Prior to the beginning of the Plan Year, or as early in the Plan Year as is practical considering the circumstances, management will recommend for Committee approval the bonus structure and accompanying details for that Plan Year. Such recommendation shall cover the following areas and any other pertinent bonus provisions:
|
(1) |
The class or class of employees eligible to participate in the Plan for such Plan Year.
|
(2) |
The performance measure or measures upon which bonuses shall be based, and the extent to which such measures shall be based on overall Company, division, or business unit performance, or some combination thereof. The application of such performance measures may vary among different categories of Participants.
|
(3) |
Target bonus levels (typically expressed as a percentage of Base Salary), threshold and maximum bonus levels (typically expressed as a percentage of the target bonus level), and the corresponding Company performance measure or measures. Such bonus levels may vary for different groups of Participants as determined by the Committee.
|
(4) |
Any Individual Adjustments that may be applied, whether based on pre-established individual performance measures or determined on a discretionary basis.
|
b. |
After the end of each Plan Year when the computations and accounting determinations required to determine Plan bonuses have been completed, the highest-ranking accounting officer of the Company will report to the Committee that in his or her opinion those computations and accounting determinations were made in reasonable accordance with the terms of the Plan, and generally accepted accounting principles, subject to any adjustments provided for under the terms of paragraph 4c of the Plan and the certifications provided for under the terms of this paragraph 4b.
|
c. |
In the event that the Company experiences any Extraordinary Items, the Chief Financial Officer, in consultation with the Chief Human Resources Officer, will recommend to the Committee, whether such Extraordinary Items will be included in or excluded from the determination of the Company’s financial performance measure or measures used in determining the bonus for the Plan Year.
|
d. |
The bonuses earned by Participants under the terms of the Plan will be paid to Participants after the first meeting of the Board of Directors which follows the end of the applicable Plan Year, but in no event later than the date by which such bonuses must be paid in order to be allowed as a Federal income tax deduction for the fiscal year coinciding with such Plan Year.
|
5. |
Participation for Partial Plan Years
:
|
a. |
Any Plan Participant whose employment with the Company terminates during a Plan Year for reasons other than Retirement, Disability or death shall not be eligible for a bonus for that Plan Year. Notwithstanding the foregoing, Company management may recommend to the Committee for its approval a discretionary bonus for any terminated Participant if in the judgment of management such a discretionary bonus is warranted.
|
b. |
Any Plan Participant whose employment with the Company terminates during a Plan Year due to Retirement, Disability or death shall be eligible for a pro-rated bonus for such Plan Year, based on Base Salary earned while a Participant in the Plan prior to such termination of employment.
|
c. |
A Participant who is eligible for a bonus hereunder for a portion of a Plan Year (due to hire, promotion or transfer during that Plan Year), shall generally be eligible for a bonus under this Plan based on Base Salary earned during the eligible portion of the Plan Year. Notwithstanding the foregoing, the bonus amount payable to a Participant who is hired within the Plan Year, moves to a different target bonus level during the Plan Year, or receives payment under another Company incentive plan during the current or prior year, shall be subject to the discretion of the Committee and its delegates.
|
d. |
Subject to the end-of-year employment requirement set forth in paragraph 5a above, a Plan Participant who is on a Company-approved leave of absence (other than a Personal Leave of absence) for a portion of a Plan Year shall remain eligible for a bonus for up to the first six months of such leave of absence. Any short-term disability pay during any such leave of absence shall be included in such Participant’s bonusable Base Salary.
|
e. |
The foregoing provisions of this paragraph 5 are subject to any Local Rules as may apply in determining (i) bonus eligibility for Employees who are hired or transferred during the Plan Year, or for Participants who terminate employment during the Play Year or prior to the bonus payment date; and (ii) bonusable Base Salary determinations for those who are Participants for partial Plan Years due to hire, transfer or termination, and for Participants who are on Company-approved leaves of absence during the Plan Year.
|
6. |
Administration
. Subject to the terms of the Plan and the powers granted to the full Board of Directors, the Committee has ultimate authority and responsibility for the administration of the Plan. The Committee shall have all powers necessary to administer the Plan, including, without limitation, the power to interpret the provisions of the Plan, to decide all questions of eligibility, to establish rules and forms for the administration of the Plan, and to delegate specific duties and responsibilities to officers or other employees of the Company. All determinations, interpretations, rules, and decisions of the Committee with respect to any question arising out of or in connection with the administration, interpretation and application of the Plan and the rules and regulations promulgated hereunder shall be final, conclusive and binding upon all persons having or claiming to have any interest or right under the Plan.
|
7. |
Indemnification
. The Company shall indemnify the members of the Committee, the other members of the Board of Directors and all Company officers and other employees responsible for administering the Plan against any and all liabilities arising by reason of any act or failure to act made in good faith in accordance with the provisions of the Plan. For this purpose, liabilities include expenses reasonably incurred in the defense of any claim relating to the Plan.
|
8. |
Amendment and Termination
. The Plan may be amended from time to time or terminated at any time by the Board of Directors of Walgreens Boots Alliance, Inc., or the Compensation Committee thereof to the extent so delegated by the Board of Directors.
|
9. |
General Plan Provisions
:
|
a. |
In addition to bonuses determined and paid pursuant to paragraph 4 hereof, nothing in this Plan is intended to limit the authority of the Committee (i) to award additional discretionary bonuses to one or more senior executives of the Company as the Committee deems appropriate from time to time and/or to (ii) approve additional discretionary bonus pools to the to be allocated among Participants as determined by the Committee.
|
b. |
The impact of the payment of bonuses under the Plan on Participants’ other Company employee benefits shall be based on the governing terms of such other employee benefit plans and programs, or as determined by the Committee or its delegates, where necessary.
|
c. |
Neither the existence of the Plan nor any substantive aspect of the Plan shall give any Participant the right to continued employment with the Company for any period of time or shall interfere with the right of the Company to discipline or discharge a Participant at any time.
|
d. |
The Company shall withhold from any bonus payment made pursuant to the Plan any taxes required to be withheld from such payment under local, state or federal law.
|
e. |
Bonuses otherwise payable hereunder may be paid on a deferred basis pursuant to any deferred compensation program that may be implemented with Committee approval in compliance with the requirements of Internal Revenue Code Section 409A and the regulations thereunder.
|
f. |
The Company shall not be required to fund or otherwise segregate any cash or other assets for purposes of meeting its obligations under the Plan.
|
g. |
The provisions of the Plan shall be construed and interpreted according to the laws of the State of Illinois, except as preempted by federal law.
|
h. |
A Participant shall not have any right to pledge, hypothecate, anticipate or in any way create a lien upon any amounts provided under this Plan and no benefits payable hereunder shall be assignable in anticipation of payment either by voluntary or involuntary acts, or by operation of law.
|
i. |
The Plan shall be binding upon the Company and any successor of the Company, including without limitation any corporation or other entity acquiring directly or indirectly all or substantially all of the assets of the Company whether by merger, consolidation, sale or otherwise. Such successor shall thereafter be deemed the "Company" for the purposes of the Plan.
|
Article 1. Establishment, Purpose, and Duration
|
1
|
Article 2. Definitions
|
1
|
Article 3. Administration
|
6
|
Article 4. Eligibility and Participation
|
7
|
Article 5. Awards
|
7
|
Article 6. Awards Not Assignable or Transferable
|
8
|
Article 7. Performance Measures
|
9
|
Article 8. Beneficiary Designation
|
10
|
Article 9. Rights of Participants
|
10
|
Article 10. Change of Control
|
11
|
Article 11. Amendment and Termination
|
11
|
Article 12. Reporting and Withholding
|
12
|
Article 13. Successors
|
12
|
Article 14. General Provisions
|
12
|
Article 1.
|
Establishment, Purpose, and Duration
|
Article 2.
|
Definitions
|
2.1 |
“
Affiliate
” means any entity (a) which, directly or indirectly, is controlled by, controls, or is under common control with the Company, or (b) in which the Company has a significant entity interest, in either case as determined by the Committee, and which is designated by the Committee as such for purposes of the Plan.
|
2.2 |
Not used.
|
2.3 |
“
Award
” means, individually or collectively, a grant to a Participant under an Award Agreement of any Cash-Based Award, subject to the terms of this Plan.
|
2.4 |
“
Award Agreement
” means either: (a) a written or electronic agreement entered into by the Company and a Participant setting forth the terms and provisions applicable to an Award granted under this Plan, including any amendment or modification thereof, or (b) a written or electronic statement issued by the Company to a Participant describing the terms and provisions of such Award, including any amendment or modification thereof. The Committee may provide for the use of electronic, Internet, or other non-paper Award Agreements, and the use of electronic, Internet, or other non-paper means for the acceptance thereof and actions thereunder by a Participant.
|
2.5 |
“
Beneficial Owner
” or “
Beneficial Ownership
” shall have the meaning ascribed to such terms in Rule 13d-3 of the General Rules and Regulations under the Exchange Act.
|
2.6 |
“
Board
” or “
Board of Directors
” means the Board of Directors of the Company.
|
2.7 |
“
Cash-Based Award
” means a contractual right granted to an Employee under Article 5 entitling such Participant to receive a cash payment or payments, at such times, and subject to such conditions, as are set forth in this Plan and the applicable Award Agreement.
|
2.8 |
“Cause”
means, unless otherwise specified in an Award Agreement or in an applicable employment agreement between the Company and a Participant, with respect to any Participant any of the following:
|
(a) |
Any act that would constitute a material violation of the Company’s material written policies;
|
(b) |
Willfully engaging in conduct materially and demonstrably injurious to the Company, provided, however, that no act or failure to act, on the Participant’s part, shall be considered “willful” unless done, or omitted to be done, by the Participant not in good faith and without reasonable belief that such action or omission was in the best interest of the Company;
|
(c) |
Being indicted for, or if charged with but not indicted for, being tried for (i) a crime of embezzlement or a crime involving moral turpitude, or (ii) a crime with respect to the Company involving a breach of trust or dishonesty, or (iii) in either case, a plea of guilty or no contest to such a crime;
|
(d) |
Abuse of alcohol in the workplace, use of any illegal drug in the workplace or a presence under the influence of alcohol or illegal drugs in the workplace;
|
(e) |
Failure to comply in any material respect with the Foreign Corrupt Practices Act, the Securities Act of 1933, the Securities Exchange Act of 1934, the Sarbanes-Oxley Act of 2002, and the Truth in Negotiations Act, or any rules and regulations issued thereunder; and
|
(f) |
Failure to follow the lawful directives of the Company’s Chief Executive Officer, the President or the Board of Directors.
|
2.9 |
“Change of Control
” means:
|
(a) |
An acquisition after the date hereof by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a "Person") of beneficial ownership (within the meaning of Rule 13d−3 promulgated under the Exchange Act) of twenty percent (20%) or more of either (a) the then-outstanding shares of common stock of the Company (the "Outstanding Company Common Stock") or (b) the combined voting power of the then-outstanding voting securities of the Company entitled to vote generally in the election of directors (the "Outstanding Company Voting Securities"); excluding, however, the following: (1) any acquisition directly from the Company, other than an acquisition by virtue of the exercise of a conversion privilege unless the security being so converted was itself acquired directly from the Company or approved by the Incumbent Board (as defined below), (2) any acquisition by the Company, (3) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any entity controlled by the Company, (4) any acquisition by an underwriter temporarily holding Company securities pursuant to an offering of such securities, or (5) any acquisition pursuant to a transaction which complies with clauses (1), (2), and (3) of subsection (c) below; or
|
(b) |
A change in the composition of the Board such that the individuals who, as of the Effective Date of the Plan, constitute the Board (such Board shall be hereinafter referred to as the "Incumbent Board") cease for any reason to constitute at least a majority of the Board;
provided, however,
for purposes of this Section, that any individual who becomes a member of the Board subsequent to the effective date of the Plan, whose election, or nomination for election by the Company's shareholders, was approved by a vote of at least a majority of those individuals who are members of the Board and who were also members of the Incumbent Board (or deemed to be such pursuant to this proviso), either by a specific vote or by approval of the proxy statement of the Company in which such person is named as a nominee for director, without written objection to such nomination shall be considered as though such individual were a member of the Incumbent Board; but,
provided further,
that any such individual whose initial assumption of office occurs as a result of either an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board shall not be so considered as a member of the Incumbent Board; or
|
(c) |
Consummation of a reorganization, merger, or consolidation (or similar transaction), a sale or other disposition of all or substantially all of the assets of the Company, or the acquisition of assets or stock of another entity ("Corporate Transaction"); in each case, unless immediately following such Corporate Transaction (i) all or substantially all of the individuals and entities who are the Beneficial Owners, respectively, of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Corporate Transaction will beneficially own, directly or indirectly, more than fifty percent (50%) of, respectively, the outstanding shares of common stock, and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Corporate Transaction (including, without limitation, a corporation which, as a result of such transaction, owns the Company or all or substantially all of the Company's assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Corporate Transaction, of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be, (ii) no Person (other than the Company, any employee benefit plan (or related trust) of the Company or such corporation resulting from such Corporate Transaction) will beneficially own, directly or indirectly, twenty percent (20%) or more of, respectively, the outstanding shares of common stock of the corporation resulting from such Corporate Transaction or the combined voting power of the outstanding voting securities of such corporation entitled to vote generally in the election of directors, except to the extent that such ownership existed prior to the Corporate Transaction, and (iii) individuals who were members of the Incumbent Board at the time of the Board's approval of the execution of the initial agreement providing for such Corporate Transaction will constitute at least a majority of the members of the board of directors of the corporation resulting from such Corporate Transaction; or
|
(d) |
The approval by the shareholders of the Company of a complete liquidation or dissolution of the Company;
|
2.10 |
“
Code
” means the U.S. Internal Revenue Code of 1986, as amended from time to time. For purposes of this Plan, references to sections of the Code shall be deemed to include references to any applicable regulations thereunder and any successor or similar provision.
|
2.11 |
“
Committee
” means the Compensation Committee of the Board or a subcommittee thereof, or any other committee designated by the Board to administer this Plan. The members of the Committee shall be appointed from time to time by and shall serve at the discretion of the Board and shall be composed of not less than two Directors, each of whom is a nonemployee director (within the meaning of Rule 16b-3) and an outside director (within the meaning of Code Section 162(m)) to the extent Rule 16b-3 and Section 162(m) of the Code, respectively, are applicable to the Company and the Plan. If the Committee does not exist or cannot function for any reason, the Board may take any action under the Plan that would otherwise be the responsibility of the Committee.
|
2.12 |
“
Company
” means Walgreens Boots Alliance, Inc., a Delaware corporation, and any successor thereto as provided in Article 13 herein.
|
2.13 |
“
Covered Employee
” means any Employee who is or may become a “Covered Employee,” as defined in Code Section 162(m), and who is designated, either as an individual Employee or class of Employees, by the Committee within the shorter of: (a) ninety (90) days after the beginning of the Performance Period provided the outcome for the Performance Period is substantially uncertain, or (b) twenty-five percent (25%) of the Performance Period has elapsed, as a “Covered Employee” under this Plan for such applicable Performance Period.
|
2.14 |
“
Director
” means any individual who is a member of the Board of Directors of the Company.
|
2.15 |
“
Disability
” shall mean disability as determined by the Committee in accordance with standards and procedures similar to those under the applicable Company long-term disability plan, if any. At any time that the Company does not maintain an applicable long-term disability plan, “Disability” shall mean any physical or mental disability which is determined to be total and permanent by a physician selected or relied upon in good faith by the Company.
|
2.16 |
“
Effective Date
” has the meaning set forth in Section 1.1.
|
2.17 |
“
Employee
” means any individual performing services for the Company, an Affiliate, or a Subsidiary, including but not limited to officers, and designated as an employee of the Company, an Affiliate, or a Subsidiary on the payroll records thereof. An Employee shall not include any individual during any period he or she is classified or treated by the Company, Affiliate, or Subsidiary as an independent contractor, a consultant, or any employee of an employment, consulting, or temporary agency or any other entity other than the Company, Affiliate, or Subsidiary, without regard to whether such individual is subsequently determined to have been, or is subsequently retroactively reclassified as a common-law employee of the Company, Affiliate, or Subsidiary during such period. An individual shall not cease to be an Employee in the case of: (a) any leave of absence approved by the Company, or (b) transfers between locations of the Company or between the Company, any Affiliates, or any Subsidiaries. A leave of absence may continue so long as the Employee is on military leave, sick leave, or other bona fide leave of absence if the period of such leave does not exceed six (6) months, or if longer, so long as the Participant retains a right to reemployment with the Company, a Subsidiary, or an Affiliate under an applicable statute or by contract. Neither service as a Director nor payment of a Director’s fee by the Company shall be sufficient to constitute "employment" by the Company.
|
2.18 |
“
Exchange Act
” means the Securities Exchange Act of 1934, as amended from time to time, or any successor act thereto.
|
2.19 |
“
Extraordinary Items
” means (a) extraordinary, unusual, nonrecurring and/or infrequently occurring items of gain or loss; (b) gains or losses on the disposition of a business; (c) changes in tax or accounting regulations or laws; or (d) the effect of a merger or acquisition, all of which must be identified in the audited financial statements, including footnotes, or Management Discussion and Analysis section of the Company’s annual report.
|
2.20 |
“
Grant Date
” means the date an Award is granted to a Participant pursuant to the Plan.
|
2.21 |
“
Participant
” means any eligible individual as set forth in Article 4 to whom an Award is granted.
|
2.22 |
“
Performance-Based Compensation
” means compensation under an Award that is intended to satisfy the requirements of Code Section 162(m) for certain performance-based compensation paid to Covered Employees. Notwithstanding the foregoing, nothing in this Plan shall be construed to mean that an Award which does not satisfy the requirements for performance-based compensation under Code Section 162(m) does not constitute performance-based compensation for other purposes, including Code Section 409A.
|
2.23 |
“
Performance Measures
” mean measures as described in Article 7 on which the performance goals are based and which are approved by the Company’s shareholders pursuant to this Plan in order to qualify Awards as Performance-Based Compensation.
|
2.24 |
“
Performance Period
” means the period of time, as determined by the Committee, during which the performance goals must be met in order to determine the degree of payout with respect to an Award.
|
2.25 |
“
Person
” has the meaning ascribed to such term in Section 3(a)(9) of the Exchange Act and used in Sections 13(d) and 14(d) thereof, including a “group” as defined in Section 13(d) thereof.
|
2.26 |
“
Plan
” means the Walgreens Boots Alliance, Inc. 2011 Cash-Based Incentive Plan (formerly the Walgreen Co. 2011 Cash-Based Incentive Plan).
|
2.27 |
“
Plan Year
” means the Company’s fiscal year, which begins September 1 and ends August 31.
|
2.28 |
“
Service
” means a Participant’s employment relationship with the Company, an Affiliate, or a Subsidiary.
|
2.29 |
“
Share
” means a share of common stock of the Company, $0.01 par value per share.
|
2.30 |
“
Specified Employee
” means a “specified employee” within the meaning of Code Section 409A and any specified employee identification policy or procedure of the Company.
|
2.31 |
“
Subsidiary
” means any corporation or other entity, whether domestic or foreign, in which the Company has or obtains, directly or indirectly, an interest of more than fifty percent (50%) by reason of stock ownership or otherwise.
|
2.32 |
“
Termination of Employment
” or “
Terminates Employment
” means a separation from Service of a Participant, within the meaning of Code Section 409A.
|
Article 3.
|
Administration
|
(a) |
To determine from time to time which of the persons eligible under the Plan shall be granted Awards, when and how each Award shall be granted, what type or combination of types of Awards shall be granted, the provisions of each Award granted (which need not be identical);
|
(b) |
To construe and interpret the Plan and Awards granted under it, and to establish, amend, and revoke rules and regulations for its administration. The Committee, in the exercise of this power, may correct any defect, omission, or inconsistency in the Plan or in an Award Agreement, in a manner and to the extent it shall deem necessary or expedient to make the Plan fully effective;
|
(c) |
To approve forms of Award Agreements for use under the Plan;
|
(d) |
To amend the Plan or any Award Agreement as provided in the Plan;
|
(e) |
To adopt subplans and/or special provisions applicable to Awards regulated by the laws of a jurisdiction other than and outside of the United States. Such subplans and/or special provisions may take precedence over other provisions of the Plan, but unless otherwise superseded by the terms of such subplans and/or special provisions, the provisions of the Plan shall govern; and
|
(f) |
To authorize any person to execute on behalf of the Company any instrument required to effectuate any Award previously granted by the Committee.
|
Article 4.
|
Eligibility and Participation
|
Article 5.
|
Awards
|
Article 6.
|
Awards Not Assignable or Transferable
|
Article 7.
|
Performance Measures
|
(a) |
Net earnings, net income, or consolidated net income (before or after taxes);
|
(b) |
Earnings per Share;
|
(c) |
Net sales or revenue growth;
|
(d) |
Achievement of balance sheet or income statement objectives;
|
(e) |
Gross, pre-tax, post-tax, or net operating profit;
|
(f) |
Return measures (including, but not limited to, return on assets, capital, invested capital, equity, sales, or revenue);
|
(g) |
Cash flow (including, but not limited to, operating cash flow, discounted cash flow, cumulative cash flow, free cash flow, cash flow return on equity, and cash flow return on investment);
|
(h) |
Earnings (based on either LIFO or FIFO accounting for inventories), before or after taxes, interest, depreciation, and/or amortization;
|
(i) |
Gross, net or operating margins;
|
(j) |
Productivity ratios;
|
(k) |
Share price (including, but not limited to, growth measures and total shareholder return);
|
(l) |
Expense targets;
|
(m) |
Costs (including cost reduction or savings);
|
(n) |
Performance against operating budget goals;
|
(o) |
Operating profit or efficiency;
|
(p) |
Unit sales volume;
|
(q) |
Market or category share;
|
(r) |
Customer satisfaction;
|
(s) |
Working capital targets;
|
(t) |
Improvements in financial ratings;
|
(u) |
Regulatory compliance;
|
(v) |
Extent to which strategic and/or business goals are met;
|
(w) |
Total return to shareholders equity (including both the market value of the Company’s Shares and dividends thereon); and,
|
(x) |
Economic value added or EVA (net operating profit after tax minus the sum of capital multiplied by the cost of capital).
|
Article 8.
|
Beneficiary Designation
|
Article 9.
|
Rights of Participants
|
Article 10.
|
Change of Control
|
(a) |
Performance Goals
. Upon a Change of Control, all then-outstanding Awards with performance goals yet to be achieved shall be considered to be earned at target values, or at such value otherwise determined by the terms and conditions set forth in the applicable Award Agreement, and payable at the time set forth in the applicable Award Agreement.
|
(b) |
Awards With Service Requirements.
Upon a Participant’s involuntary termination for a reason other than Cause during the two (2) year period following a Change of Control, any Service requirement applicable to then-outstanding Awards shall be considered satisfied.
|
Article 11.
|
Amendment and Termination
|
(a) |
Subject to subparagraph (b) of this Section 11.1 and Section 11.3 of the Plan, the Board may at any time terminate the Plan or an outstanding Award Agreement and the Committee may, at any time and from time to time, amend the Plan or an outstanding Award Agreement.
|
(b) |
Notwithstanding the foregoing, no amendment of this Plan shall be made without shareholder approval if shareholder approval is required pursuant to rules promulgated by any stock exchange or quotation system on which Shares are listed or quoted or by applicable U.S. state corporate laws or regulations, applicable U.S. federal laws or regulations, and the applicable laws of any foreign country or jurisdiction where Awards are, or will be, granted under the Plan.
|
Article 12.
|
Reporting and Withholding
|
Article 13.
|
Successors
|
Article 14.
|
General Provisions
|
(a) |
The Committee may specify in an Award Agreement that the Participant’s rights, payments, and benefits with respect to an Award shall be subject to reduction, cancellation, forfeiture, or recoupment upon the occurrence of certain specified events, in addition to any otherwise applicable vesting or performance conditions of an Award. Such events may include, but shall not be limited to, termination of employment for Cause, termination of the Participant’s provision of services to the Company, Affiliate, or Subsidiary, violation of material Company, Affiliate, or Subsidiary policies, breach of noncompetition, confidentiality, or other restrictive covenants that may apply to the Participant, or other conduct by the Participant that is detrimental to the business or reputation of the Company, any Affiliate, or Subsidiary.
|
(b) |
If any of the Company’s financial statements are required to be restated resulting from errors, omissions, or fraud, the Committee may (in its sole discretion, but acting in good faith) direct that the Company recover all or a portion of any Award granted or paid to a Participant with respect to any fiscal year of the Company the financial results of which are negatively affected by such restatement. The amount to be recovered from the Participant shall be the amount by which the Award exceeded the amount that would have been payable to the Participant had the financial statements been initially filed as restated, or any greater or lesser amount (including, but not limited to, the entire Award) that the Committee shall determine. In no event shall the amount to be recovered by the Company be less than the amount required to be repaid or recovered as a matter of law (including but not limited to amounts that are required to be recovered or forfeited under Section 304 of the Sarbanes-Oxley Act of 2002 or Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010). The Committee shall determine whether the Company shall effect any such recovery: (i) by seeking repayment from the Participant, (ii) by reducing (subject to applicable law and the terms and conditions of the applicable plan, program or arrangement) the amount that would otherwise be payable to the Participant under any compensatory plan, program, or arrangement maintained by the Company, an Affiliate, or any Subsidiary, (iii) by withholding payment of future increases in compensation (including the payment of any discretionary bonus amount) or grants of compensatory awards that would otherwise have been made in accordance with the Company’s otherwise applicable compensation practices, or (iv) by any combination of the foregoing.
|
(a) |
Determine which Affiliates and Subsidiaries shall be covered by this Plan;
|
(b) |
Determine which Employees outside the United States are eligible to participate in this Plan;
|
(c) |
Modify the terms and conditions of any Award granted to Employees outside the United States to comply with applicable foreign laws;
|
(d) |
Establish sub-plans and modify any terms and procedures, to the extent such actions may be necessary or advisable. Any subplans and modifications to Plan terms and procedures established under this Section 14.5 by the Committee shall be attached to this Plan document as appendices; and
|
(e) |
Take any action, before or after an Award is made, that it deems advisable to obtain approval or comply with any necessary local government regulatory exemptions or approvals.
|
(a) |
The Committee may grant Awards under the Plan that provide for the deferral of compensation within the meaning of Code Section 409A. It is intended that such Awards comply with the requirements of Code Section 409A so that amounts deferred thereunder are not includible in income before actual payment and are not subject to an additional tax of twenty percent (20%) at the time the deferred amounts are no longer subject to a substantial risk of forfeiture.
|
(b) |
Notwithstanding any provision of the Plan or Award Agreement to the contrary, if one or more of the payments or benefits to be received by a Participant pursuant to an Award would constitute deferred compensation subject to Code Section 409A and would cause the Participant to incur any penalty tax or interest under Code Section 409A or any regulations or Treasury guidance promulgated thereunder, the Committee may reform the Plan and Award Agreement to comply with the requirements of Code Section 409A and to the extent practicable maintain the original intent of the Plan and Award Agreement. By accepting an Award under this Plan, a Participant agrees to any amendments to the Award made pursuant to this Section 14.8(b) without further consideration or action.
|
a. |
“Trade Secrets” are a form of intellectual property and may include all tangible and intangible forms and types of financial, business, scientific, technical, economic, or engineering information, including patterns, plans, compilations, program devices, formulas, designs, prototypes, methods, techniques, processes, procedures, programs or codes, and may in particular include such things as pricing information, business records, software programs, algorithms, inventions, patent applications, and designs and processes not known outside the Company. Trade Secrets may be stored, compiled, memorialized or contained in various forms or media, such as paper, electronic media or transmission (such as disc, email, file transfers, tape, or web site features), all other forms of audio and/or video transfer, or even oral communications.
|
b. |
“Confidential Information” shall include Trade Secrets and, more broadly, any information or material which is not generally known to the public, and which (i) is generated or collected by or utilized in the operations of the Company and relates to the actual or anticipated business of the Company or the Company’s actual or prospective vendors or clients; or (ii) is suggested by or results from any task assigned to me by the Company or work performed by me for or on behalf of the Company or any client of the Company. Confidential Information shall not be considered generally known to the public if revealed improperly to the public by me or others without the Company’s express written consent and/or in violation of an obligation of confidentiality to the Company. Confidential Information may take a variety of forms including but not limited to paper, electronic, media or transmission (such as email, file transfers, tape or web site features), and all other forms of audio and/or video transfer. Examples of confidential information include, but are not limited to, customer, referral source, supplier and contractor identification and contacts, confidential information about customers, business relationships, contract terms, pricing and margins, business, marketing and customer plans and strategies, financial data, techniques, formulations, technical know-how, formulae, research, development and production information, processes, designs, architectures, prototypes, models, software, patent applications and plans, projections, proposals, discussion guides, personal or performance information about employees, or legal advice related to the foregoing.
|
(a) |
I will not directly or indirectly, solicit any Restricted Customer for purposes of providing Competing Products or Services, or offer, provide or sell Competing Products or Services to any Restricted Customer. For purposes of this Agreement, “Competing Products or Services” means products or services that are competitive with products or services offered by, developed by, designed by or distributed by the Company to any Restricted Customer, and “Restricted Customer” means any person, company or entity which was a customer, potential customer, vendor, supplier or referral source of the Company and with which I had direct contact or about which I learned confidential information at any time during the last two years of my employment with the Company; and
|
(b) |
I will not, nor will I assist any third party to, directly or indirectly (i) raid, hire, solicit, or attempt to persuade any employee of the Company with whom I currently work or with whom I worked at any point during the last two years preceding the termination of my employment with the Company, and who possesses or had access to confidential information of the Company, to leave the employ of the Company; (ii) interfere with the performance by any such employee of his/her duties for the Company; or (iii) communicate with any such employee for the purposes described in items (i) and (ii) in this paragraph.
|
a. |
Ownership
. All Intellectual Property is, shall be and shall remain the exclusive property of the Company. Employee hereby assigns to the Company all right, title and interest, if any, in and to the Intellectual Property; provided, however, that, when applicable, the Company shall own the copyrights in all copyrightable works included in the Intellectual Property pursuant to the "work-made-for-hire" doctrine (rather than by assignment), as such term is defined in the 1976 Copyright Act. All Intellectual Property shall be owned by the Company irrespective of any copyright notices or confidentiality legends to the contrary which may be placed on such works by Employee or by others. Employee shall ensure that all copyright notices and confidentiality legends on all work product authored by Employee or anyone acting on his/her behalf shall conform to the Company's practices and shall specify the Company as the owner of the work. The Company hereby provides notice to Employee that the obligation to assign does not apply to an invention for which no equipment, supplies, facility, or trade secret information of the Company was used and which was developed entirely on the Employee's own time, unless (a) the invention relates (i) to the business of the Company, or (ii) to the Company’s actual or demonstrably anticipated research or development, or (b) the invention results from any work performed by Employee for the Company.
|
b. |
Keep Records
. Employee shall keep and maintain, or cause to be kept and maintained by anyone acting on his/her behalf, adequate and current written records of all Intellectual Property in the form of notes, sketches, drawings, computer files, reports or other documents relating thereto. Such records shall be and shall remain the exclusive property of the Company and shall be available to the Company at all times during the term of this Agreement.
|
c. |
Assistance
. Employee shall supply all assistance requested in securing for Company’s benefit any patent, copyright, trademark, service mark, license, right or other evidence of ownership of any such Intellectual Property, and will provide full information regarding any such item and execute all appropriate documentation prepared by Company in applying or otherwise registering, in Company’s name, all rights to any such item or the defense and protection of such Intellectual Property.
|
d. |
Prior Inventions
. Employee has disclosed to the Company any continuing obligations to any third party with respect to Intellectual Property. Employee claims no rights to any inventions created prior to his/her employment for which a patent application has not previously been filed, unless he/she has described them in detail on a schedule attached to this Agreement.
|
e. |
Trade Secret Provisions
. The provisions in Paragraph 1 with regard to Trade Secrets and the TSA shall apply as well in the context of the parties’ Intellectual Property rights and obligations.
|
(a) |
I agree that the restrictions contained in this Agreement are reasonable and necessary to protect the Company’s legitimate business interests and that
full compliance with the terms of this Agreement will not prevent me from earning a livelihood following the termination of my employment, and that these covenants do not place undue restraint on me.
|
(b) |
Because the Company’s current base of operations is in Illinois and my connections thereto, (i) this Agreement shall be governed by and construed in accordance with the laws of the State of Illinois, where this Agreement is entered into, without giving effect to any conflict of law provisions, and (ii) I consent to personal jurisdiction and the exclusive jurisdiction of the state and federal courts of Illinois with respect to any claim, dispute or declaration arising out of this Agreement.
|
(c) |
In the event of a breach or a threatened breach of this Agreement, I acknowledge that the Company will face irreparable injury which may be difficult to calculate in dollar terms and that the Company shall be entitled, in addition to all remedies otherwise available in law or in equity, to temporary restraining orders and preliminary and final injunctions enjoining such breach or threatened breach in any court of competent jurisdiction without the necessity of posting a surety bond, as well as to obtain an equitable accounting of all profits or benefits arising out of any violation of this Agreement.
|
(d) |
I agree that if a court determines that any of the provisions in this Agreement is unenforceable or unreasonable in duration, territory, or scope, then that court shall modify those provisions so they are reasonable and enforceable, and enforce those provisions as modified.
|
(e) |
If any phrase or provision of this Agreement is declared invalid or unenforceable by a court of competent jurisdiction, that phrase, clause or provision shall be deemed severed from this Agreement, and will not affect the enforceability of any other provisions of this Agreement, which shall otherwise remain in full force and effect.
|
(f) |
Notwithstanding the foregoing provisions of this Agreement, the non-competition provisions of Paragraph 2 above shall not restrict Employee from performing legal services as a licensed attorney for a Competing Business to the extent that the attorney licensure requirements in the applicable jurisdiction do not permit Employee to agree to the otherwise applicable restrictions of Paragraph 2.
|
(g) |
Waiver of any of the provisions of this Agreement by the Company in any particular instance shall not be deemed to be a waiver of any provision in any other instance and/or of the Company’s other rights at law or under this Agreement.
|
(h) |
I agree that the Company may assign this Agreement to its successors and assigns and that any such successor or assign may stand in the Company’s shoes for purposes of enforcing this Agreement.
|
(i) |
I agree to reimburse the Company for all attorneys’ fees, costs, and expenses that it reasonably incurs in connection with enforcing its rights and remedies under this Agreement, but only to the extent the Company is ultimately the prevailing party in the applicable legal proceedings.
|
(j) |
If I violate this Agreement, then the restrictions set out in Paragraphs 2 - 6 shall be extended by the same period of time as the period of time during which the violation(s) occurred.
|
(k) |
I
fully understand my obligations in this Agreement, have had full and complete opportunity to discuss and resolve any ambiguities or uncertainties regarding these covenants before signing this Agreement, and have voluntarily agreed to comply with these covenants for their stated terms.
|
a) |
The starting date of the offer will be the Grant Date, and this offer conforms to general ruling no. 336 of the Chilean superintendence of securities and insurance;
|
b) |
The offer deals with securities not registered in the registry of securities or in the registry of foreign securities of the Chilean superintendence of securities and insurance, and therefore such securities are not subject to its oversight;
|
c) |
The issuer is not obligated to provide public information in Chile regarding the foreign securities, since such securities are not registered with the Chilean superintendence of securities and insurance; and
|
d) |
The foreign securities shall not be subject to public offering as long as they are not registered with the corresponding registry of securities in Chile.
|
a) |
La fecha de inicio de la oferta será el de la fecha de otorgamiento y esta oferta se acoge a la norma de carácter general n° 336 de la superintendencia de valores y seguros chilena;
|
b) |
La oferta versa sobre valores no inscritos en el registro de valores o en el registro de valores extranjeros que lleva la superintendencia de valores y seguros chilena, por lo que tales valores no están sujetos a la fiscalización de ésta;
|
c) |
Por tratar de valores no inscritos no existe la obligación por parte del emisor de entregar en chile información pública respecto de esos valores; y
|
d) |
Esos valores no podrán ser objeto de oferta pública mientras no sean inscritos en el registro de valores correspondiente.
|
a. |
“Trade Secrets” are a form of intellectual property and may include all tangible and intangible forms and types of financial, business, scientific, technical, economic, or engineering information, including patterns, plans, compilations, program devices, formulas, designs, prototypes, methods, techniques, processes, procedures, programs or codes, and may in particular include such things as pricing information, business records, software programs, algorithms, inventions, patent applications, and designs and processes not known outside the Company. Trade Secrets may be stored, compiled, memorialized or contained in various forms or media, such as paper, electronic media or transmission (such as disc, email, file transfers, tape, or web site features), all other forms of audio and/or video transfer, or even oral communications.
|
b. |
“Confidential Information” shall include Trade Secrets and, more broadly, any information or material which is not generally known to the public, and which (i) is generated or collected by or utilized in the operations of the Company and relates to the actual or anticipated business of the Company or the Company’s actual or prospective vendors or clients; or (ii) is suggested by or results from any task assigned to me by the Company or work performed by me for or on behalf of the Company or any client of the Company. Confidential Information shall not be considered generally known to the public if revealed improperly to the public by me or others without the Company’s express written consent and/or in violation of an obligation of confidentiality to the Company. Confidential Information may take a variety of forms including but not limited to paper, electronic, media or transmission (such as email, file transfers, tape or web site features), and all other forms of audio and/or video transfer. Examples of confidential information include, but are not limited to, customer, referral source, supplier and contractor identification and contacts, confidential information about customers, business relationships, contract terms, pricing and margins, business, marketing and customer plans and strategies, financial data, techniques, formulations, technical know-how, formulae, research, development and production information, processes, designs, architectures, prototypes, models, software, patent applications and plans, projections, proposals, discussion guides, personal or performance information about employees, or legal advice related to the foregoing.
|
(a) |
I will not directly or indirectly, solicit any Restricted Customer for purposes of providing Competing Products or Services, or offer, provide or sell Competing Products or Services to any Restricted Customer. For purposes of this Agreement, “Competing Products or Services” means products or services that are competitive with products or services offered by, developed by, designed by or distributed by the Company to any Restricted Customer, and “Restricted Customer” means any person, company or entity which was a customer, potential customer, vendor, supplier or referral source of the Company and with which I had direct contact or about which I learned confidential information at any time during the last two years of my employment with the Company; and
|
(b) |
I will not, nor will I assist any third party to, directly or indirectly (i) raid, hire, solicit, or attempt to persuade any employee of the Company with whom I currently work or with whom I worked at any point during the last two years preceding the termination of my employment with the Company, and who possesses or had access to confidential information of the Company, to leave the employ of the Company; (ii) interfere with the performance by any such employee of his/her duties for the Company; or (iii) communicate with any such employee for the purposes described in items (i) and (ii) in this paragraph.
|
a. |
Ownership
. All Intellectual Property is, shall be and shall remain the exclusive property of the Company. Employee hereby assigns to the Company all right, title and interest, if any, in and to the Intellectual Property; provided, however, that, when applicable, the Company shall own the copyrights in all copyrightable works included in the Intellectual Property pursuant to the "work-made-for-hire" doctrine (rather than by assignment), as such term is defined in the 1976 Copyright Act. All Intellectual Property shall be owned by the Company irrespective of any copyright notices or confidentiality legends to the contrary which may be placed on such works by Employee or by others. Employee shall ensure that all copyright notices and confidentiality legends on all work product authored by Employee or anyone acting on his/her behalf shall conform to the Company's practices and shall specify the Company as the owner of the work. The Company hereby provides notice to Employee that the obligation to assign does not apply to an invention for which no equipment, supplies, facility, or trade secret information of the Company was used and which was developed entirely on the Employee's own time, unless (a) the invention relates (i) to the business of the Company, or (ii) to the Company’s actual or demonstrably anticipated research or development, or (b) the invention results from any work performed by Employee for the Company.
|
b. |
Keep Records
. Employee shall keep and maintain, or cause to be kept and maintained by anyone acting on his/her behalf, adequate and current written records of all Intellectual Property in the form of notes, sketches, drawings, computer files, reports or other documents relating thereto. Such records shall be and shall remain the exclusive property of the Company and shall be available to the Company at all times during the term of this Agreement.
|
c. |
Assistance
. Employee shall supply all assistance requested in securing for Company’s benefit any patent, copyright, trademark, service mark, license, right or other evidence of ownership of any such Intellectual Property, and will provide full information regarding any such item and execute all appropriate documentation prepared by Company in applying or otherwise registering, in Company’s name, all rights to any such item or the defense and protection of such Intellectual Property.
|
d. |
Prior Inventions
. Employee has disclosed to the Company any continuing obligations to any third party with respect to Intellectual Property. Employee claims no rights to any inventions created prior to his/her employment for which a patent application has not previously been filed, unless he/she has described them in detail on a schedule attached to this Agreement.
|
e. |
Trade Secret Provisions
. The provisions in Paragraph 1 with regard to Trade Secrets and the TSA shall apply as well in the context of the parties’ Intellectual Property rights and obligations.
|
(a) |
I agree that the restrictions contained in this Agreement are reasonable and necessary to protect the Company’s legitimate business interests and that
full compliance with the terms of this Agreement will not prevent me from earning a livelihood following the termination of my employment, and that these covenants do not place undue restraint on me.
|
(b) |
Because the Company’s current base of operations is in Illinois and my connections thereto, (i) this Agreement shall be governed by and construed in accordance with the laws of the State of Illinois, where this Agreement is entered into, without giving effect to any conflict of law provisions, and (ii) I consent to personal jurisdiction and the exclusive jurisdiction of the state and federal courts of Illinois with respect to any claim, dispute or declaration arising out of this Agreement.
|
(c) |
In the event of a breach or a threatened breach of this Agreement, I acknowledge that the Company will face irreparable injury which may be difficult to calculate in dollar terms and that the Company shall be entitled, in addition to all remedies otherwise available in law or in equity, to temporary restraining orders and preliminary and final injunctions enjoining such breach or threatened breach in any court of competent jurisdiction without the necessity of posting a surety bond, as well as to obtain an equitable accounting of all profits or benefits arising out of any violation of this Agreement.
|
(d) |
I agree that if a court determines that any of the provisions in this Agreement is unenforceable or unreasonable in duration, territory, or scope, then that court shall modify those provisions so they are reasonable and enforceable, and enforce those provisions as modified.
|
(e) |
If any phrase or provision of this Agreement is declared invalid or unenforceable by a court of competent jurisdiction, that phrase, clause or provision shall be deemed severed from this Agreement, and will not affect the enforceability of any other provisions of this Agreement, which shall otherwise remain in full force and effect.
|
(f) |
Notwithstanding the foregoing provisions of this Agreement, the non-competition provisions of Paragraph 2 above shall not restrict Employee from performing legal services as a licensed attorney for a Competing Business to the extent that the attorney licensure requirements in the applicable jurisdiction do not permit Employee to agree to the otherwise applicable restrictions of Paragraph 2.
|
(g) |
Waiver of any of the provisions of this Agreement by the Company in any particular instance shall not be deemed to be a waiver of any provision in any other instance and/or of the Company’s other rights at law or under this Agreement.
|
(h) |
I agree that the Company may assign this Agreement to its successors and assigns and that any such successor or assign may stand in the Company’s shoes for purposes of enforcing this Agreement.
|
(i) |
I agree to reimburse the Company for all attorneys’ fees, costs, and expenses that it reasonably incurs in connection with enforcing its rights and remedies under this Agreement, but only to the extent the Company is ultimately the prevailing party in the applicable legal proceedings.
|
(j) |
If I violate this Agreement, then the restrictions set out in Paragraphs 2 - 6 shall be extended by the same period of time as the period of time during which the violation(s) occurred.
|
(k) |
I
fully understand my obligations in this Agreement, have had full and complete opportunity to discuss and resolve any ambiguities or uncertainties regarding these covenants before signing this Agreement, and have voluntarily agreed to comply with these covenants for their stated terms.
|
a) |
The starting date of the offer will be the Grant Date, and this offer conforms to general ruling no. 336 of the Chilean superintendence of securities and insurance;
|
b) |
The offer deals with securities not registered in the registry of securities or in the registry of foreign securities of the Chilean superintendence of securities and insurance, and therefore such securities are not subject to its oversight;
|
c) |
The issuer is not obligated to provide public information in Chile regarding the foreign securities, since such securities are not registered with the Chilean superintendence of securities and insurance; and
|
d) |
The foreign securities shall not be subject to public offering as long as they are not registered with the corresponding registry of securities in Chile.
|
a) |
La fecha de inicio de la oferta será el de la fecha de otorgamiento y esta oferta se acoge a la norma de carácter general n° 336 de la superintendencia de valores y seguros chilena;
|
b) |
La oferta versa sobre valores no inscritos en el registro de valores o en el registro de valores extranjeros que lleva la superintendencia de valores y seguros chilena, por lo que tales valores no están sujetos a la fiscalización de ésta;
|
c) |
Por tratar de valores no inscritos no existe la obligación por parte del emisor de entregar en chile información pública respecto de esos valores; y
|
d) |
Esos valores no podrán ser objeto de oferta pública mientras no sean inscritos en el registro de valores correspondiente.
|
|
|
|
Boots Support Office
1 Thane Road
Beeston
Nottingham
NG90 1BS
|
1. |
As discussed, you have confirmed (and we have agreed) that your employment with Boots Management Services Limited (“
the Company
”) terminated on 15 July 2016 (“
the Termination Date
”). You acknowledge and accept that you were paid your contractual salary and benefits up to and including that date (less such deductions for tax and social security contributions as the Company was required to make by law) pursuant to your Executive Service Agreement with the Company (“
your Executive Service Agreement
”). There will be no further accrual, payments or payments in lieu of contractual salary or benefits after the Termination Date save as expressly stated below.
|
2. |
To the extent not already reimbursed, the Company shall reimburse any expenses reasonably incurred by you in the proper performance of your duties in accordance with the Company’s expenses policy.
|
3.
|
To
the
extent not already returned on or before the Termination Date, you will return all Company property in your possession or under your control including but not limited to all Company cars, laptops, mobile telephones, keys, security cards, credit cards, books, documents, papers, materials, computer discs and software and any copies thereof (whether in human readable or machine readable form).4.As your employment came to an end before the date of payment of any FY16 annual bonus, no bonus shall be payable to you under that scheme.
|
5. |
I confirm that you will also forfeit all awards under the Walgreens Boots Alliance, Inc. 2013 Omnibus Incentive Plan (“
the Plan
”) in accordance with the Plan rules.
|
6. |
Subject to paragraph 9 below, the Company hereby confirms that it has exercised its discretion pursuant to clause 12.5 of your Executive Service Agreement and shall make a payment to you in lieu of your basic salary under clause 3.2 thereof (
less such deductions as the Company is required to make by law) (“
the Notice Payment
”)
for the unexpired 12 months of the notice period.
|
Boots Management Services Limited.
Registered office: 1 Thane Road West, Nottingham, NG2 3AA
Registered in England & Wales: Number 7073438
|
|
|
Member of Walgreens Boots Alliance
|
|
7. |
Subject to paragraph 8 below and to any other written agreement that may be reached between us concerning the same, the post-termination obligations contained in clause 16 of your Executive Service Agreement shall remain in full force and effect and shall be immediately effective from the Termination Date.
|
8. |
In consideration of the Notice Payment
it is agreed that those organisations listed below and their holding companies and subsidiaries and the subsidiaries of any such holding companies from time to time shall replace the list of organisations set out in Schedule 2 of your Executive Service Agreement
:
|
· |
Ahold
|
· |
Asda
|
· |
A.S.Watson
|
· |
Celesio
|
· |
Cerp Rouen
|
· |
CVS
|
· |
John Lewis or Waitrose
|
· |
Marks & Spencer
|
· |
Mediq (formerly known as OPG)
|
· |
Morrisons
|
· |
Noweda
|
· |
Optical Express
|
· |
Phoenix Healthcare
|
· |
Sanacorp
|
· |
Specsavers
|
· |
Superdrug
|
· |
Tesco
|
· |
UK-based Co-operative Societies
|
· |
Vision Express
|
· |
WalMart
|
· |
Well+ Pharmacy
|
9. |
The Notice Payment will be paid to you in equal monthly instalments, commencing in the calendar month immediately after the Termination Date, until such time as you secure alternative employment or for a period of 12 months (whichever is earlier). For the purposes of this paragraph, “alternative employment” means any office, appointment, employment or self-employment under the terms of a contract of service or contract for services or otherwise
.
|
10. |
Notwithstanding any other rights the Company may have against you, if you breach any provision of paragraph 8 above you acknowledge and agree to repay to the Company a sum equivalent to all gross payments made to you pursuant to paragraph 6 above and you agree that such sum is recoverable from you by the Company as a debt.
|
Boots Management Services Limited.
Registered office: 1 Thane Road West, Nottingham, NG2 3AA
Registered in England & Wales: Number 7073438
|
|
|
Member of Walgreens Boots Alliance
|
|
11.
|
You will resign (to the extent that you have not already done so) as an Officer of Walgreens Boots Alliance, Inc. from all and any directorships held in the Company and its Associated Companies in the form attached with immediate effect from the Termination Date.
|
12.
|
In this letter, “Associated Companies” means in relation to a company its holding companies and subsidiaries and the subsidiaries of any such holding companies from time to time.
|
13.
|
This letter together with any other written agreement between us following the Termination Date contains the entire agreement between the parties in relation to its subject matter and supersedes any prior arrangement, understanding written or oral agreements between the parties in relation to such subject matter.
|
14.
|
The existence, effect and interpretation of this letter shall be governed by the laws of England and the parties submit to the non-exclusive jurisdiction of the courts of England.
|
Signed |
/s/ Simon Roberts
|
Dated |
26
th
September 2016
|
Boots Management Services Limited.
Registered office: 1 Thane Road West, Nottingham, NG2 3AA
Registered in England & Wales: Number 7073438
|
|
|
Member of Walgreens Boots Alliance
|
|
Boots Management Services Limited.
Registered office: 1 Thane Road West, Nottingham, NG2 3AA
Registered in England & Wales: Number 7073438
|
|
|
Member of Walgreens Boots Alliance
|
|
2016
|
2015
|
2014
|
2013
|
2012
|
2011
|
|||||||||||||||||||
Income before income tax provision
|
$
|
5,144
|
$
|
5,311
|
$
|
3,557
|
$
|
4,047
|
$
|
3,376
|
$
|
4,294
|
||||||||||||
Add:
|
||||||||||||||||||||||||
Minority Interests
|
-
|
-
|
-
|
5
|
-
|
-
|
||||||||||||||||||
Fixed charges
|
2,367
|
2,054
|
1,376
|
1,383
|
1,260
|
1,212
|
||||||||||||||||||
Amortization of capitalized interest
|
-
|
1
|
6
|
7
|
6
|
5
|
||||||||||||||||||
Less:
|
||||||||||||||||||||||||
Equity earnings
|
(37
|
)
|
(315
|
)
|
(617
|
)
|
(496
|
)
|
-
|
-
|
||||||||||||||
Capitalized interest
|
-
|
(1
|
)
|
(6
|
)
|
(7
|
)
|
(9
|
)
|
(10
|
)
|
|||||||||||||
Earnings as defined
|
$
|
7,474
|
$
|
7,050
|
$
|
4,316
|
$
|
4,939
|
$
|
4,633
|
$
|
5,501
|
||||||||||||
Interest expense, net of capitalized interest
|
$
|
628
|
$
|
632
|
$
|
168
|
$
|
193
|
$
|
94
|
$
|
77
|
||||||||||||
Capitalized interest
|
-
|
1
|
6
|
7
|
9
|
10
|
||||||||||||||||||
Portions of rentals representative of the interest factor
|
1,739
|
1,421
|
1,202
|
1,183
|
1,157
|
1,125
|
||||||||||||||||||
Fixed charges as defined
|
$
|
2,367
|
$
|
2,054
|
$
|
1,376
|
$
|
1,383
|
$
|
1,260
|
$
|
1,212
|
||||||||||||
Ratio of earnings to fixed charges
|
3.16
|
3.43
|
3.14
|
3.57
|
3.68
|
4.54
|
Name
|
State or Country
of Incorporation
|
Smart Insurance Company
|
Arizona
|
Walgreen Arizona Drug Co.
|
Arizona
|
Consolidated Stores, Inc.
|
Arkansas
|
Pharm-Mart Pharmacy of Warren, Inc.
|
Arkansas
|
S & W Pharmacy, Inc.
|
Arkansas
|
Stephen L. LaFrance Pharmacy, Inc.
|
Arkansas
|
Superior Bermuda GP
|
Bermuda
|
Casa Saba Brasil Holdings, Ltda
|
Brazil
|
Distrilife, Distribuidora Atacadista de Suplementos Alimenticios, Ltda
|
Brazil
|
Brandhandling International Limited
|
British Virgin Islands
|
Sunamerica Affordable Housing Partners XI, a California Limited Partnership
|
California
|
DS Distribution Canada Ltd.
|
Canada
|
Walgreen Drug (Ontario) Limited
|
Canada
|
AB Acquisitions FX Pref Limited
|
Cayman Islands
|
AB Property Holdings Limited
|
Cayman Islands
|
Ontario CI 1 Limited
|
Cayman Islands
|
Ontario CI 2 Limited
|
Cayman Islands
|
Ontario CI 3 Limited
|
Cayman Islands
|
Ontario CI 4 Limited
|
Cayman Islands
|
Walgreen Asia Holding Ltd.
|
Cayman Islands
|
WBAD CI 1 Limited
|
Cayman Islands
|
WBAD CI 2 Limited
|
Cayman Islands
|
ABF, Administradora de Beneficios Farmacéuticos S.A.
|
Chile
|
Administradora Fasa, S.A.
|
Chile
|
Comercial Farmacéutica S.A.
|
Chile
|
Comercializadora y Distribuidora BF S.A.
|
Chile
|
Compañía de Nutrición General S.A.
|
Chile
|
Droguería, Distribuidora y Logística DLI S.A.
|
Chile
|
Farmacias Ahumada S.A.
|
Chile
|
Fasa Investment Limitada
|
Chile
|
Inmobiliaria Gestión Punto Retail S.A.
|
Chile
|
Inversiones Internacionales Inverfar S.A.
|
Chile
|
Laboratorios MDK S.A.
|
Chile
|
Walgreen Asia Trading Ltd.
|
China
|
Walgreens China Business Trust
|
China
|
Alliance Healthcare s.r.o.
|
Czech Republic
|
Boots Retail Holdings (USA) Inc.
|
Delaware
|
Boots Retail USA Inc.
|
Delaware
|
CG Transportation, LLC
|
Delaware
|
Cystic Fibrosis Foundation Pharmacy, LLC
|
Delaware
|
DR Employee Services, LLC
|
Delaware
|
DRI I Inc.
|
Delaware
|
DS Pharmacy, Inc.
|
Delaware
|
Duane Reade Holdings, Inc.
|
Delaware
|
Duane Reade Inc.
|
Delaware
|
Duane Reade International, LLC
|
Delaware
|
East West Distributing Co., LLC
|
Delaware
|
Happy Harry's Discount Drug Stores, Inc.
|
Delaware
|
Happy Harry's, Inc.
|
Delaware
|
Healthcare Clinic Solutions, LLC
|
Delaware
|
Lake Cook Investments, LLC
|
Delaware
|
Pharma Dynamics, Inc.
|
Delaware
|
S&G US Holding LLC
|
Delaware
|
SIC Parent, LLC
|
Delaware
|
Smart Insurance Company Holdings, Inc.
|
Delaware
|
Smart Insurance Group Holdings, Inc
|
Delaware
|
Soap & Glory USA LLC
|
Delaware
|
Stephen L. LaFrance Holdings, Inc.
|
Delaware
|
Super D Drugs Acquisition Co.
|
Delaware
|
Take Care Health Systems, LLC
|
Delaware
|
WAGDCO, LLC
|
Delaware
|
WAGHID, LLC
|
Delaware
|
Walgreen International Investments LLC
|
Delaware
|
Walgreen Investments Co
|
Delaware
|
Walgreens Boots Alliance Holdings LLC
|
Delaware
|
Walgreens Boots Alliance, Inc.
|
Delaware
|
Walgreens Network Health Services, LLC
|
Delaware
|
Walgreens of North Carolina, Inc.
|
Delaware
|
Walgreens Sleep and Respiratory Services, LLC
|
Delaware
|
Walgreens Specialty Care Centers, LLC
|
Delaware
|
Walgreens Specialty Pharmacy Holdings, Inc.
|
Delaware
|
Walgreens Specialty Pharmacy, LLC
|
Delaware
|
Walgreens Venture Capital, LLC
|
Delaware
|
Waltrust Properties, Inc.
|
Delaware
|
WBA Financial, Inc
|
Delaware
|
WBA Investments, Inc.
|
Delaware
|
Well Ventures, LLC
|
Delaware
|
WRA Partners, LLC
|
Delaware
|
Alcura France SAS
|
France
|
Alliance Healthcare Formation SAS
|
France
|
Alliance Healthcare France SA (AHF)
|
France
|
Alliance Healthcare Group France SAS
|
France
|
Alliance Healthcare Répartition SAS
|
France
|
Alloga France SAS
|
France
|
Almus France SAS
|
France
|
Alphega SA
|
France
|
BCM Cosmetique SAS
|
France
|
Directlog SAS
|
France
|
Serex SAS
|
France
|
Skills in Healthcare France SAS
|
France
|
WBA France Finance SAS
|
France
|
acadicPharm GmbH
|
Germany
|
Alliance Healthcare Deutschland AG
|
Germany
|
Alliance Healthcare Deutschland Holdings 1 GmbH
|
Germany
|
ANZAG Rostock GmbH & Co. KG
|
Germany
|
ANZAG Rostock Grundstucks-Verwaltungsgesellschaft mbH
|
Germany
|
AS Logistik GmbH
|
Germany
|
BCM Kosmetik GmbH
|
Germany
|
CPL Pharma Lager und Vertrieb GmbH
|
Germany
|
GESDAT Gesellschaft fur Informationsmanagement mbH
|
Germany
|
Skills in Healthcare GmbH Deutschland
|
Germany
|
Soap & Glory GmbH
|
Germany
|
vitasco GmbH
|
Germany
|
Walgreen of Hawaii, LLC
|
Hawaii
|
Walgreen of Maui, Inc.
|
Hawaii
|
AA Asia Limited
|
Hong Kong
|
Alliance Boots Sourcing (Hong Kong) Limited
|
Hong Kong
|
Alliance Healthcare Asia Pacific Limited
|
Hong Kong
|
Alliance Healthcare Hong Kong Limited
|
Hong Kong
|
Walgreens (Hong Kong) Limited
|
Hong Kong
|
Bond Drug Company of Illinois, LLC
|
Illinois
|
Bowen Development Company
|
Illinois
|
Deerfield Funding Corporation
|
Illinois
|
Medication Adherence Solutions, LLC
|
Illinois
|
The 1901 Group, LLC
|
Illinois
|
The Patient Safety Research Foundation, Inc.
|
Illinois
|
Victoria Merger Sub, Inc.
|
Illinois
|
Walgreen Co.
|
Illinois
|
Walgreen Medical Supply, LLC
|
Illinois
|
Walgreen Mercantile Corporation
|
Illinois
|
Walgreen National Corporation
|
Illinois
|
Walgreen Pharmacy Services Midwest, LLC
|
Illinois
|
Walgreen Realty Resources LLC
|
Illinois
|
Walgreens Business Services, LLC
|
Illinois
|
Walgreens Community Development Corporation
|
Illinois
|
Walgreens Mail Service, Inc
|
Illinois
|
Walgreens Pharmacy Strategies, LLC
|
Illinois
|
Walgreens Store No. 7839, LLC
|
Illinois
|
Walgreens.com, Inc
|
Illinois
|
AB Acquisitions (Ireland) 2 Limited
|
Ireland
|
AB Acquisitions (Ireland) Limited
|
Ireland
|
Alliance Healthcare Limited
|
Ireland
|
Boots Retail (Ireland) Limited
|
Ireland
|
Woodglen Properties Limited
|
Ireland
|
Alliance Healthcare Italia (IT Services) Srl
|
Italy
|
Boots Contact Lenses Limited
|
Jersey
|
Armila UAB
|
Lithuania
|
Ramuneles Vaistine UAB
|
Lithuania
|
Walgreen Louisiana Co., Inc.
|
Louisiana
|
AB Acquisitions Luxco 1 S.à r.l.
|
Luxembourg
|
AB Acquisitions Luxco 2 S.à r.l.
|
Luxembourg
|
AB Acquisitions Luxco 2A S.à r.l.
|
Luxembourg
|
AB Acquisitions Luxco 3 S.à r.l.
|
Luxembourg
|
AB Acquisitions Luxco 3A S.à r.l.
|
Luxembourg
|
AB Acquisitions Luxco 4 S.à r.l.
|
Luxembourg
|
AB Acquisitions Luxco 5 S.à r.l.
|
Luxembourg
|
AB Acquisitions Luxco 5A S.à r.l.
|
Luxembourg
|
AB Acquisitions Luxco 6 S.à r.l.
|
Luxembourg
|
AB Acquisitions Luxco 7 S.à r.l.
|
Luxembourg
|
AB Acquisitions Luxco 8 S.à r.l.
|
Luxembourg
|
AB Acquisitions Luxco 8A S.à r.l.
|
Luxembourg
|
AB Acquisitions Luxco 9 S.à r.l.
|
Luxembourg
|
Alliance Boots Luxco Property Company S.à r.l.
|
Luxembourg
|
Alliance Boots Luxembourg S.à r.l.
|
Luxembourg
|
Alloga S.à r.l.
|
Luxembourg
|
Superior Luxco 1 S.à r.l.
|
Luxembourg
|
Superior Luxco 2 S.à r.l.
|
Luxembourg
|
Superior Luxco 3 S.à r.l.
|
Luxembourg
|
Walgreen Asia Services S.à r.l.
|
Luxembourg
|
Walgreen International S.à r.l.
|
Luxembourg
|
Walgreen Investments Luxembourg SCS
|
Luxembourg
|
Cystic Fibrosis Services, Inc.
|
Maryland
|
Eager Park Pharmacy and Health Services, LLC
|
Maryland
|
Walgreens of Massachusetts, LLC
|
Massachusetts
|
Benavides de Reynosa, S.A. de C.V.
|
Mexico
|
Comercializadora y Servicios Benavides, S.A. de C.V.
|
Mexico
|
Farmacias ABC de Mexico, S.A. de C.V.
|
Mexico
|
Farmacias Benavides S.A.B. de C.V.
|
Mexico
|
Servicios Generales Benavides, S.A. de C.V.
|
Mexico
|
Servicios Logisticos Benavides, S.A. de C.V.
|
Mexico
|
Servicios Operacionales Benavides, S.A. de C.V.
|
Mexico
|
Walgreens Boots Alliance Services MC S.A.M.
|
Monaco
|
Walgreen Hastings Co.
|
Nebraska
|
AB Acquisitions Nederland Holdco 1 B.V.
|
Netherlands
|
Alliance Boots B.V.
|
Netherlands
|
Alliance Healthcare Management Services (Nederland) B.V.
|
Netherlands
|
Alliance Healthcare Nederland B.V.
|
Netherlands
|
Alloga (Nederland) B.V.
|
Netherlands
|
Boots Nederland B.V.
|
Netherlands
|
Euro Registratie Collectief B.V.
|
Netherlands
|
Hedef International Holdings BV
|
Netherlands
|
Kring apotheek B.V.
|
Netherlands
|
Spits B.V.
|
Netherlands
|
Stephar B.V.
|
Netherlands
|
Duane Reade
|
New York
|
Walgreen Eastern Co., Inc.
|
New York
|
Walgreens Store No. 3288, LLC
|
New York
|
Alliance Healthcare Norge AS
|
Norway
|
Boots Norge AS
|
Norway
|
Snipetjernveien 10 AS
|
Norway
|
May's Drug Stores, Inc.
|
Oklahoma
|
Med-X Corporation
|
Oklahoma
|
M-X Corporation
|
Oklahoma
|
Alliance Santé - Distribuição Farmacêutica de Eulália Baeta Pereira e Ramalho Fernandes, S.A.
|
Portugal
|
Walgreen of Puerto Rico, Inc.
|
Puerto Rico
|
Walgreen of San Patricio, Inc.
|
Puerto Rico
|
FARMEXPERT D.C.I. SRL
|
Romania
|
Skills in Healthcare Romania S.r.l.
|
Romania
|
Boots Singapore Private Limited
|
Singapore
|
Alcura Health España, S.A.
|
Spain
|
Alliance Healthcare España Holdings, S.L.
|
Spain
|
Alliance Healthcare España S.A.
|
Spain
|
Alloga Logistica (España), S.L.
|
Spain
|
Almus Farmaceutica, S.A.
|
Spain
|
Centro Farmaceutico Asturiano, S.A.
|
Spain
|
Nexiapharma, S.L.
|
Spain
|
AH Schweiz GmbH
|
Switzerland
|
Alliance Boots GmbH
|
Switzerland
|
Alliance Boots Schweiz Investments GmbH
|
Switzerland
|
Alliance Boots Services GmbH
|
Switzerland
|
Walgreen Swiss International GmbH
|
Switzerland
|
Walgreens Boots Alliance Development GmbH
|
Switzerland
|
Aromatherapy Associates, Inc
|
Texas
|
Globe Stores, Inc.
|
Texas
|
Vision Direct Inc.
|
Texas
|
Boots Retail (Thailand) Limited
|
Thailand
|
Alliance Healthcare Ecza Deposu Anonim Şirketi (fka Hedef
Ecza Deposu Ticaret A.S.)
|
Turkey
|
Alliance Healthcare Turkey Holding A.S.
|
Turkey
|
Alliance Healthcare Yatırım Holding Anonim Şirketi (fka Hedef - Alliance Holding A.S.)
|
Turkey
|
Esko Itriyat Sanayi ve Ticaret Anonim Sirketi
|
Turkey
|
Nareks Ecza
Deposu Ticaret Anonim Şirketi
|
Turkey
|
Skills in Healthcare Pazarlama ve Tanıtım Hizmetleri Anonim Şirketi
|
Turkey
|
AB Acquisitions FX Inter Limited
|
United Kingdom
|
AB Acquisitions UK Holdco 2 Limited
|
United Kingdom
|
AB Acquisitions UK Holdco 5 Limited
|
United Kingdom
|
AB Acquisitions UK Holdco 6 Limited
|
United Kingdom
|
AB Acquisitions UK Holdco 7 Limited
|
United Kingdom
|
AB Acquisitions UK Topco Limited
|
United Kingdom
|
Alcura UK Limited
|
United Kingdom
|
Alliance BMP Limited
|
United Kingdom
|
Alliance Boots (Nominees) Limited
|
United Kingdom
|
Alliance Boots Group Limited
|
United Kingdom
|
Alliance Boots Holdings 1 Limited
|
United Kingdom
|
Alliance Boots Holdings 2
|
United Kingdom
|
Alliance Boots Holdings Limited
|
United Kingdom
|
Alliance Boots International Limited
|
United Kingdom
|
Alliance Boots Investments 2 Limited
|
United Kingdom
|
Alliance Boots Latin America Limited
|
United Kingdom
|
Alliance Boots Limited
|
United Kingdom
|
Alliance Boots PropCo A LLP
|
United Kingdom
|
Alliance Boots PropCo B LLP
|
United Kingdom
|
Alliance Boots PropCo Beeston LLP
|
United Kingdom
|
Alliance Boots PropCo C LLP
|
United Kingdom
|
Alliance Boots PropCo Retail Flex LLP
|
United Kingdom
|
Alliance Boots PropCo Unichem Flex LLP
|
United Kingdom
|
Alliance Boots PropCo Unichem LLP
|
United Kingdom
|
Alliance Boots Scottish Limited Partnership
|
United Kingdom
|
Alliance Healthcare (Distribution) Limited
|
United Kingdom
|
Alliance Healthcare (IT Services) Limited
|
United Kingdom
|
Alliance Healthcare Management Services Limited
|
United Kingdom
|
Alliance UniChem Investments 4 Limited
|
United Kingdom
|
Alliance UniChem IP Limited
|
United Kingdom
|
Alliance UniChem PWS JV Limited
|
United Kingdom
|
Alloga UK Limited
|
United Kingdom
|
Almus Pharmaceuticals Limited
|
United Kingdom
|
Aroma Actives Limited
|
United Kingdom
|
Aromatherapy Associates Limited
|
United Kingdom
|
Aromatherapy Investments Holding Limited
|
United Kingdom
|
Aromatherapy Investments Limited
|
United Kingdom
|
B&B Capital Partners (GP) Ltd
|
United Kingdom
|
B&B Capital Partners (SLP GP) Ltd
|
United Kingdom
|
B&B Capital Partners L.P.
|
United Kingdom
|
BCM Employment & Management Services Limited
|
United Kingdom
|
BCM Limited
|
United Kingdom
|
BCM Specials Limited
|
United Kingdom
|
Beachcourse Limited
|
United Kingdom
|
Beeston Site Services Limited
|
United Kingdom
|
Bellpharm Limited
|
United Kingdom
|
Blyth Pharmacy Limited
|
United Kingdom
|
Boots 2 Property Partnership
|
United Kingdom
|
Boots 2 Property Scottish Limited Partnership
|
United Kingdom
|
Boots Benevolent Fund
|
United Kingdom
|
Boots Charitable Trust
|
United Kingdom
|
Boots Delivery Services Limited
|
United Kingdom
|
Boots Development Properties Limited
|
United Kingdom
|
Boots Eyewear Limited
|
United Kingdom
|
Boots International Limited
|
United Kingdom
|
Boots International Management Services Limited
|
United Kingdom
|
Boots Korea Limited
|
United Kingdom
|
Boots Management Services Limited
|
United Kingdom
|
Boots Optical Investment Holdings Limited
|
United Kingdom
|
Boots Opticians Limited
|
United Kingdom
|
Boots Opticians Professional Services Limited
|
United Kingdom
|
Boots Pensions Limited
|
United Kingdom
|
Boots PropCo A Limited
|
United Kingdom
|
Boots PropCo B Limited
|
United Kingdom
|
Boots PropCo Beeston Limited
|
United Kingdom
|
Boots PropCo C Limited
|
United Kingdom
|
Boots Propco D Limited
|
United Kingdom
|
Boots Propco E Limited
|
United Kingdom
|
Boots Propco F Limited
|
United Kingdom
|
Boots PropCo Flex Limited
|
United Kingdom
|
Boots Propco G Limited
|
United Kingdom
|
Boots Propco H Limited
|
United Kingdom
|
Boots PropCo Limited
|
United Kingdom
|
Boots PropCo Retail Flex Limited
|
United Kingdom
|
Boots Properties Limited
|
United Kingdom
|
Boots Property HoldCo Limited
|
United Kingdom
|
Boots Property Partnership
|
United Kingdom
|
Boots Property Scottish Limited Partnership
|
United Kingdom
|
Boots Pure Drug Company Limited
|
United Kingdom
|
Boots The Chemists Limited
|
United Kingdom
|
Boots UK Limited
|
United Kingdom
|
Burrells Limited
|
United Kingdom
|
Burrows & Close Limited
|
United Kingdom
|
Caseview (P.L.) Limited
|
United Kingdom
|
Class Delta Limited
|
United Kingdom
|
D200 Energy Limited
|
United Kingdom
|
DDM Healthcare Limited
|
United Kingdom
|
Dollond & Aitchison Limited
|
United Kingdom
|
E. Moss, Limited
|
United Kingdom
|
Easterhouse Health Centre Pharmacy Limited
|
United Kingdom
|
Gordon's Chemist Limited
|
United Kingdom
|
Govanhill Pharmacy Limited
|
United Kingdom
|
Leamington Spa Properties (Two) Limited
|
United Kingdom
|
Liz Earle Beauty Co. (International) Limited
|
United Kingdom
|
Liz Earle Beauty Co. Limited
|
United Kingdom
|
Ontario Scottish Partnership
|
United Kingdom
|
Ontario UK 2 Limited
|
United Kingdom
|
OTC Direct Limited
|
United Kingdom
|
PhD Acquisition Bidco Limited
|
United Kingdom
|
PhD Acquisition Midco Limited
|
United Kingdom
|
PhD Nutrition Limited
|
United Kingdom
|
S and G Investments Limited
|
United Kingdom
|
Sleek Capital Limited
|
United Kingdom
|
Sleek International Limited
|
United Kingdom
|
Soap & Glory Limited
|
United Kingdom
|
Spa Strategy Limited
|
United Kingdom
|
SportsPlatform Holdco Limited
|
United Kingdom
|
SportsPlatform Midco Limited
|
United Kingdom
|
Sprint Investments 1 Limited
|
United Kingdom
|
Sprint Investments 5 Limited
|
United Kingdom
|
Superior Acquisitions Limited
|
United Kingdom
|
Superior Holdings Limited
|
United Kingdom
|
The Boots Company PLC
|
United Kingdom
|
The Refinery Limited
|
United Kingdom
|
TPW Acquisition Bidco Limited
|
United Kingdom
|
TPW Acquisition Midco Limited
|
United Kingdom
|
UniChem Limited
|
United Kingdom
|
W.H.C.P. (Dundee) Limited
|
United Kingdom
|
Walgreens Boots Alliance Scottish LP
|
United Kingdom
|
Walgreens Boots Alliance Services Limited
|
United Kingdom
|
WBA 1 Scottish LLP
|
United Kingdom
|
WBA 2 Scottish LLP
|
United Kingdom
|
WBA Finance 1 Limited
|
United Kingdom
|
WBA Finance 2 Limited
|
United Kingdom
|
WBA Financial Limited
|
United Kingdom
|
WBA Financial Services Limited
|
United Kingdom
|
WBA UK 1 LLP
|
United Kingdom
|
WBA UK 2 LLP
|
United Kingdom
|
WBA UK 3 LLP
|
United Kingdom
|
WBA UK 4 LLP
|
United Kingdom
|
WBA UK 5 LLP
|
United Kingdom
|
WBA UK 6 LLP
|
United Kingdom
|
WBA UK 7 LLP
|
United Kingdom
|
WBA UK 8 LLP
|
United Kingdom
|
WBA UK Finance Limited
|
United Kingdom
|
WBAD Holdings Limited
|
United Kingdom
|
Walgreen of US Virgin Islands, LLC
|
US Virgin Islands
|
LCA Insurance Co., Inc.
|
Vermont
|
drugstore.com, LLC
|
Washington
|
Walgreen Oshkosh, Inc.
|
Wisconsin
|
1. |
I have reviewed this annual report on Form 10-K of Walgreens Boots Alliance, Inc.;
|
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4. |
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c) |
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d) |
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5. |
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
/s/
|
Stefano Pessina
|
Chief Executive Officer
|
Date: October 20, 2016
|
|
Stefano Pessina
|
1. |
I have reviewed this annual report on Form 10-K of Walgreens Boots Alliance, Inc.;
|
2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3. |
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4. |
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) and 15d-15(f)) for the registrant and have:
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a) |
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b) |
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c) |
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d) |
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5. |
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
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a) |
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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b) |
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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/s/
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George Fairweather
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Global Chief Financial Officer
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Date: October 20, 2016
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George Fairweather
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