NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1 — BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of Business

On November 12, 2019, Tech Data Corporation entered into an Agreement and Plan of Merger, as subsequently amended on November 27, 2019 (the ‘‘Apollo Merger Agreement’’), with Tiger Midco, LLC (“Tiger Midco”) and Tiger Merger Sub Co. (“Merger Sub”). Tiger Midco and Merger Sub are affiliates of certain funds (the “Apollo Funds”), managed by affiliates of Apollo Global Management Inc. (“Apollo”). Pursuant to the Apollo Merger Agreement, Tiger Midco agreed to acquire all the outstanding shares of Tech Data Corporation’s common stock (other than shares held by Tech Data Corporation as treasury stock or held by certain affiliates of the Apollo Funds) for $145 per share in cash. On June 30, 2020, Merger Sub merged with and into Tech Data Corporation (the “Apollo Merger”), with Tech Data Corporation surviving the Apollo Merger as a direct wholly-owned subsidiary of Tiger Midco (see Note 2—Acquisitions for additional information).

Tiger Parent, LLC was formed on November 6, 2019 and was converted to Tiger Parent (AP) Corporation on June 12, 2020. Tiger Parent (AP) Corporation, through its wholly-owned subsidiaries including Tiger Midco, is the parent company of Tech Data Corporation subsequent to the Apollo Merger. The consolidated financial statements include the consolidated results of Tech Data Corporation for periods prior to the Apollo Merger on June 30, 2020 (the “predecessor period”) and the consolidated results of Tiger Parent (AP) Corporation for periods subsequent to the Apollo Merger (the “successor period”). References to the “Company” indicate Tiger Parent (AP) Corporation and its subsidiaries for periods subsequent to the date of the Apollo Merger and Tech Data Corporation and its subsidiaries for periods prior to the Apollo Merger.

The Company is one of the world’s largest IT distribution and solutions companies. The Company serves a critical role in the center of the IT ecosystem, bringing products from the world’s leading technology vendors to market, as well as helping customers create solutions best suited to maximize business outcomes for their end-user customers. The Company’s customers include value-added resellers, direct marketers, retailers, corporate resellers and managed service providers who support the diverse technology needs of end users. The Company manages its business in three geographic regions: the Americas, Europe and Asia-Pacific.

On March 22, 2021, the Company entered into an Agreement and Plan of Merger (the “SYNNEX Merger Agreement”) with SYNNEX Corporation (“SYNNEX”) and its affiliates. Pursuant to the SYNNEX Merger Agreement, and upon the terms and subject to the conditions described therein, the affiliates of SYNNEX will acquire all the outstanding shares of the Company’s common stock (the “SYNNEX Merger”).

At the effective time of the SYNNEX Merger, except as otherwise set forth in the SYNNEX Merger Agreement, all the issued and outstanding common shares of the Company will be converted automatically into and thereafter represent only the right to receive (i) $1,610,000,000 in cash, in the aggregate and (ii) 44,000,000 total shares of common stock of SYNNEX. Prior to the effective date of the SYNNEX Merger, affiliates of Apollo are required to make an additional equity contribution of at least $500 million in cash to the Company. The completion of the SYNNEX Merger is also subject to customary closing conditions, including the approval by the holders of a majority of the stock of SYNNEX of both the share issuance and an increase in the authorized number of shares of SYNNEX common stock of 100 million, the expiration of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act, the receipt of other required approvals under foreign antitrust laws, the approval of the listing on the New York Stock Exchange of the shares of SYNNEX common stock to be issued as consideration in the SYNNEX Merger and other customary closing conditions.

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Principles of Consolidation

The consolidated financial statements include the accounts of Tiger Parent (AP) Corporation and its subsidiaries during the successor period and Tech Data Corporation and its subsidiaries during the predecessor period. All significant intercompany accounts and transactions have been eliminated in consolidation. The Company operates on a fiscal year that ends on January 31.

Basis of Presentation

The consolidated financial statements have been prepared by the Company, without audit, in conformity with generally accepted accounting principles in the U.S. (“GAAP”). These principles require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

The Apollo Merger was accounted for as a business combination using the purchase method of accounting. As a result of the application of purchase accounting, the consolidated financial statements for the successor period are not comparable to those of the predecessor period.

In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments (consisting of only normal recurring adjustments) necessary to present fairly the consolidated financial position of the Company as of April 30, 2021, and its consolidated statements of operations, comprehensive income (loss), shareholders’ equity and cash flows for the three months ended April 30, 2021 and 2020.

Seasonality

The Company’s quarterly operating results have fluctuated significantly in the past and will likely continue to do so in the future as a result of currency fluctuations and seasonal variations in the demand for the products and services it sells. Historical seasonal variations have included an increase in European demand during the Company’s fiscal fourth quarter. The seasonal trend in Europe typically results in greater operating leverage, and therefore, lower selling, general and administrative expenses as a percentage of net sales in the region during the Company’s fourth quarter.

Furthermore, in March 2020, the World Health Organization declared the outbreak of the 2019 novel coronavirus (“COVID-19”) a pandemic. The global impact of the COVID-19 pandemic has had a negative effect on the global economy, disrupting the financial markets and creating increasing volatility, impacting customer demand and impeding global supply chains. The Company cannot at this time accurately predict what effects these conditions will have on its operations and financial condition, including due to uncertainties relating to the severity and duration of the pandemic, the effect on its customers and customer demand and the length of the restrictions and closures imposed by various governments. Therefore, the results of operations for the three months ended April 30, 2021 are not necessarily indicative of the results that can be expected for the entire fiscal year ended January 31, 2022.

Revenue Recognition

The Company’s revenues primarily result from the sale of various technology products and services. The Company recognizes revenue as control of products is transferred to customers, which generally happens at the point of shipment. Products sold by the Company are delivered via shipment from the Company’s facilities, dropshipment directly from the vendor, or by electronic delivery of keys for software products. In relation to product support, supply chain management and other services performed by the Company, revenue is recognized over time as the services are performed. Service revenues and related contract liabilities were not material for the periods presented.

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The Company has contracts with certain customers where the Company’s performance obligation is to arrange for the products or services to be provided by another party. In these arrangements, as the Company assumes an agency relationship in the transaction, revenue is recognized in the amount of the net fee associated with serving as an agent. These arrangements primarily relate to certain fulfillment contracts, as well as sales of software services and extended warranty services.

The Company allows its customers to exchange product or return for credit subject to certain limitations. A liability is recorded at the time of sale for estimated product returns based upon historical experience and an asset is recognized for the amount expected to be recorded in inventory upon product return. The Company also provides volume rebates and other discounts to certain customers which are considered variable consideration. A provision for customer rebates and other discounts is recorded as a reduction of revenue at the time of sale based on an evaluation of the contract terms and historical experience.

The Company considers shipping and handling activities as costs to fulfill the sales of products. Shipping revenue is included in net sales when control of the product is transferred to the customer, and the related shipping and handling costs are included in cost of products sold. Taxes imposed by governmental authorities on the Company’s revenue producing activities with customers, such as sales taxes and value added taxes, are excluded from net sales.

The Company disaggregates its revenue by geography, which the Company believes provides a meaningful depiction of the nature of its revenue. Net sales includes service revenues, which are not a significant component of total revenue and are aggregated within the respective geographies. The following table sets forth the Company’s disaggregated net sales (in thousands):

The following table provides a comparison of sales generated from products purchased from vendors that exceeded 10% of the Company’s consolidated net sales for the three months ended April 30, 2021 and 2020 (as a percent of consolidated net sales):

Accounts Receivable

The Company maintains an allowance for credit losses related to accounts receivable for future expected credit losses resulting from the inability or unwillingness of its customers to make required payments. In estimating the required allowance, the Company takes into consideration historical credit losses, current conditions and reasonable and supportable forecasts. Adjustments to historical loss information are made for

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differences in current conditions as well as changes in forecasted macroeconomic conditions, such as changes in unemployment rates or gross domestic product growth. Expected credit losses are estimated on a pool basis when similar risk characteristics exist using an age-based reserve model. Receivables that do not share risk characteristics are evaluated on an individual basis.

The following is a reconciliation of the Company’s allowance for credit losses (in thousands):

The Company has uncommitted accounts receivable purchase agreements under which certain accounts receivable may be sold, without recourse, to third-party financial institutions. Under these programs, the Company may sell certain accounts receivable in exchange for cash less a discount, as defined in the agreements. Available capacity under these programs, which the Company uses as a source of working capital funding, is dependent on the level of accounts receivable eligible to be sold into these programs and the financial institutions’ willingness to purchase such receivables. In addition, certain of these agreements also require that the Company continue to service, administer and collect the sold accounts receivable. At April 30, 2021 and January 31, 2021, the Company had a total of $633.5 million and $691.9 million, respectively, of accounts receivable sold to and held by financial institutions under these agreements. During the three months ended April 30, 2021 and 2020, discount fees recorded under these facilities were $2.4 million and $3.1 million, respectively. These discount fees are included as a component of “other expense, net” in the Consolidated Statement of Operations.

Transactions with Related Parties

In connection with the Apollo Merger, the Company has entered into certain transactions with its parent, Tiger Parent Holdings, L.P. (the “Parent”) and certain affiliates of Apollo, including a management fee agreement. Fees incurred under the management fee agreement were $2.4 million for the three months ended April 30, 2021 and are included in “selling, general and administrative expenses” on the Consolidated Statement of Operations. At April 30, 2021, the Company had amounts payable to the Parent of $6.2 million primarily related to transaction costs associated with the completion of the Apollo Merger, which are included in “accrued expenses and other liabilities” on the Consolidated Balance Sheet.

Recently Issued and Adopted Accounting Standards

In December 2019, the Financial Accounting Standards Board (“FASB”) issued ASU 2019-12, which simplifies and clarifies various aspects of the income tax accounting guidance. Under the new standard, certain amendments are to be applied prospectively, while other amendments are to be applied retrospectively to all periods presented. The Company adopted this standard during the quarter ended April 30, 2021. The adoption of this standard had no material impact on the Company’s consolidated financial statements.

Subsequent Events

The Company evaluated subsequent events through June 2, 2021, which is the date the financial statements were available to be issued.

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NOTE 2—ACQUISITIONS

The Apollo Merger

Pursuant to the Apollo Merger Agreement, on June 30, 2020, Merger Sub merged with and into Tech Data Corporation, with Tech Data Corporation surviving the Apollo Merger as a direct wholly-owned subsidiary of Tiger Midco. Tiger Midco, which is a wholly-owned subsidiary of Tiger Parent (AP) Corporation, acquired all the outstanding shares of Tech Data Corporation’s common stock (other than shares held by Tech Data Corporation as treasury stock or held by certain affiliates of the Apollo Funds) for $145 per share in cash. Additionally, per the terms of the Apollo Merger Agreement, all nonvested restricted stock units (“RSU’s”) were vested, cancelled and converted into the right to receive an amount of $145 per share in cash. Nonvested performance based restricted stock units (“PRSU’s”) were also cancelled and converted into the right to receive an amount of $145 per share in cash determined as follows: (i) for PRSU’s granted during fiscal 2019, the number of shares equaled 130% of the target shares granted and (ii) for PRSU’s granted during fiscal 2020, the number of shares equaled 110% of the target shares granted. The aggregate purchase price was approximately $5.2 billion.

The Parent contributed approximately $3.7 billion as equity to Tiger Parent (AP) Corporation in conjunction with the Apollo Merger, of which approximately $3.6 billion was used to fund the purchase price for Tech Data Corporation. The remaining purchase price for Tech Data Corporation was financed through the issuance of debt (see Note 4 – Debt for further discussion) and cash on hand at Tech Data Corporation.

The Company has accounted for the Apollo Merger as a business combination and allocated the purchase price to the estimated fair values of Tech Data Corporation’s assets and liabilities. The Company has not yet completed its evaluation and determination of certain assets and liabilities, primarily (i) the final assessment and valuation of certain assets and liabilities, including accounts receivable and accounts payable and (ii) the final assessment and valuation of certain income tax amounts. Therefore, the final fair values of the assets and liabilities may vary from the Company’s preliminary estimates.

The preliminary allocation of the purchase price is as follows:

The allocation of the value of identifiable intangible assets includes approximately $2.1 billion of customer relationships with amortization periods ranging from 10 years to 15 years, with a weighted average amortization period of 14 years and $622 million of indefinite-lived trade names. Goodwill is the excess of the consideration

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transferred over the net assets recognized and primarily represents future economic benefits arising from assets acquired that are not individually identified and separately recognized, including synergies inherent in the existing business, of which approximately $550 million is expected to be deductible for tax purposes.

The following table presents unaudited supplemental pro forma information as if the Apollo Merger had occurred at the beginning of fiscal 2020, after giving effect to certain adjustments related to the transaction. The pro forma results exclude any benefits that may result from potential cost savings and certain non-recurring costs. As a result, the pro forma information below does not purport to present what actual results would have been had the Apollo Merger been consummated on the date indicated and it is not necessarily indicative of the results of operations that may result in the future.

Adjustments reflected in the pro forma results include the following:

Innovix Acquisition

On September 30, 2020, the Company completed the acquisition of Innovix Distribution (“Innovix”), a leading technology distributor in the Asia-Pacific region for a purchase price of approximately $52 million in cash. The Innovix acquisition expands the Company’s presence across the Asia-Pacific region and strengthens its Endpoint Solutions and Advanced Solutions capabilities. The Company has accounted for the acquisition as a business combination and allocated the purchase price to the estimated fair values of assets acquired and liabilities assumed, including cash of approximately $21 million, accounts receivable of approximately $121 million, inventory of approximately $41 million and accounts payable, accrued expenses and other current liabilities of approximately $107 million. The excess of the estimated fair values of the net tangible assets over the purchase price was recorded as a gain on bargain purchase of $30.2 million in the Consolidated Statement of Operations for the period ended January 31, 2021. The Company acquired the net assets of Innovix for an amount less than fair value as its former parent decided to exit this business after it concluded that Innovix represented an insignificant non-strategic portion of its consolidated operations.

The Company has not yet completed its evaluation and determination of certain assets acquired and liabilities assumed, primarily (i) the final assessment and valuation of certain other assets acquired and liabilities assumed, including accounts receivable, inventory, accrued expenses and other liabilities and (ii) the final assessment and valuation of certain tax amounts. Therefore, the final fair values of the assets acquired and liabilities assumed may vary from the Company’s preliminary estimates. Proforma information for the acquisition of Innovix has not been presented as the acquisition was not material to the Company’s consolidated financial position or results of operations.

Finance Technology Acquisition

On February 10, 2021, the Company completed the acquisition of Finance Technology AS (“Finance Technology”), a specialist technology-as-a-service (“TaaS”) platform provider for a purchase price of

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approximately $14.1 million in cash. The Finance Technology acquisition enhances the Company’s ability to offer innovative, integrated and flexible TaaS solutions at scale across the European region. The Company has accounted for the acquisition as a business combination and allocated the purchase price to the estimated fair values of assets acquired, primarily intangible assets.

The Company has not yet completed its evaluation and determination of certain assets acquired and liabilities assumed. Therefore, the final fair values of the assets acquired and liabilities assumed may vary from the Company’s preliminary estimates. Proforma information for the acquisition of Finance Technology has not been presented as the acquisition was not material to the Company’s consolidated financial position or results of operations.

NOTE 3—ACQUISITION, INTEGRATION AND RESTRUCTURING EXPENSES

Acquisition, integration and restructuring expenses are primarily comprised of costs related to the Apollo Merger, the new Global Optimization Program initiated in fiscal 2021 (the “GBO 2 Program”), the prior Global Business Optimization Program which was initiated in fiscal 2019 (the “GBO Program”), the tdONE Program and the SYNNEX Merger.

The Apollo Merger

The Company incurred transaction costs related to the completion of the Apollo Merger, including professional services costs and personnel and other costs. Professional services costs are primarily comprised of legal expenses and tax and other consulting services. Personnel and other costs are primarily comprised of retention costs.

Transaction costs related to the Apollo Merger are comprised of the following:

GBO 2 Program

In conjunction with the completion of the Apollo Merger, in fiscal 2021 the Company began its GBO 2 Program. The GBO 2 Program includes investments that will optimize and standardize processes and apply data and analytics to be more agile in a rapidly evolving environment, increasing productivity, profitability and optimizing net-working capital. Acquisition, integration and restructuring expenses related to the GBO 2 Program are primarily comprised of restructuring costs and other professional services costs. Restructuring costs are comprised of severance costs and other associated exit costs, including certain consulting costs. Other professional services costs are primarily comprised of professional services fees unrelated to restructuring activities, including costs related to improving profitability and optimizing net-working capital. The Company has incurred cumulative acquisition, integration and restructuring expenses under the GBO 2 program of approximately $71 million through April 30, 2021. The Company’s estimate of total acquisition, integration and restructuring expenses under the GBO 2 program is $175 million to $200 million. The majority of the remaining costs are expected to be incurred through fiscal 2023.

The Company had no GBO 2 Program costs for the three months ended April 30, 2020. Acquisition, integration and restructuring costs for the three months ended April 30, 2021 related to the GBO 2 Program are comprised of the following:

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Restructuring costs related to the GBO 2 Program are comprised of the following:

Restructuring activity during the three months ended April 30, 2021 related to the GBO 2 Program is as follows:

GBO Program

In fiscal 2019, the Company began its GBO Program to increase investment in its strategic priorities and implement operational initiatives to drive productivity and enhance profitability. The restructuring costs primarily consist of severance costs, and also include other associated exit costs, including certain professional services costs. The GBO Program was completed during the quarter ended July 31, 2020.

Restructuring costs related to the GBO Program are comprised of the following:

tdONE Program

In fiscal 2021, the Company began the tdONE Program to simplify, standardize and synchronize the Company’s processes and systems in support of its global transformation initiative. Acquisition and integration

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costs related to the tdONE program include $4.4 million in professional services and $3.1 million in personnel and other costs for the three months ended April 30, 2021. There were no tdONE costs incurred during the three months ended April 30, 2020.

SYNNEX Merger

During the three months ended April 30, 2021, the Company incurred transaction costs of $2.2 million related to the pending SYNNEX Merger, which are primarily comprised of professional services and transaction related costs.

Senior Notes

In January 2017, the Company issued $500.0 million aggregate principal amount of 3.70% Senior Notes due February 15, 2022 (the “2022 Senior Notes”) and $500.0 million aggregate principal amount of 4.95% Senior Notes due February 15, 2027 (the “2027 Senior Notes”) (collectively the “Senior Notes”). The Company pays interest on the Senior Notes semi-annually in arrears on February 15 and August 15 of each year. The interest rate payable on the Senior Notes will be subject to adjustment from time to time if the credit rating assigned to such series of notes changes; however, at no point will the interest rate be reduced below the interest rate payable on the notes on the date of the initial issuance or increase more than 2.00% above the interest rate payable on the notes of the series on the date of their initial issuance. The interest rate payable on the Senior Notes initially increased by 1.00% as a result of the Apollo Merger and in the quarter ended April 30, 2021 has further increased an additional 1.00%. The Senior Notes are senior unsecured obligations of Tech Data Corporation and will rank equally with all other unsecured and unsubordinated indebtedness from time to time outstanding.

The Company, at its option, may redeem the 2022 Senior Notes at any time prior to January 15, 2022 and the 2027 Senior Notes at any time prior to November 15, 2026, in each case in whole or in part, at a redemption price equal to the greater of (i) 100% of the principal amount of the Senior Notes to be redeemed or (ii) the sum

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of the present values of the remaining scheduled payments of principal and interest on the Senior Notes to be redeemed, discounted to the date of redemption on a semi-annual basis at a rate equal to the sum of the applicable Treasury Rate plus 30 basis points for the 2022 Senior Notes and 40 basis points for the 2027 Senior Notes, plus the accrued and unpaid interest on the principal amount being redeemed up to the date of redemption. The Company may also redeem the Senior Notes, at any time in whole or from time to time in part, on or after January 15, 2022 for the 2022 Senior Notes and November 15, 2026 for the 2027 Senior Notes, in each case, at a redemption price equal to 100% of the principal amount of the Senior Notes to be redeemed.

On March 10, 2020, Merger Sub launched an offer to purchase for cash any and all of the Company’s outstanding 2022 Senior Notes and any and all of the Company’s outstanding 2027 Senior Notes and a consent solicitation to amend the indenture and global securities establishing the 2022 Senior Notes and the 2027 Senior Notes to (i) eliminate the requirement to make a “change of control” offer in connection with the proposed merger of Merger Sub into Tech Data Corporation pursuant to the Apollo Merger Agreement and (ii) make certain other customary changes for a privately-held company to the “change of control” provisions (the “Proposed Amendments”). Concurrently with, but separate from, the aforementioned offer to purchase and consent solicitation, Merger Sub launched a consent solicitation for the Proposed Amendments for holders of the 2027 Senior Notes. On March 24, 2020, Merger Sub announced that the requisite more than 50% of consents were received to adopt the Proposed Amendments. The aforementioned consent solicitations were conducted by Merger Sub pursuant to the terms of, and subject to the conditions set forth in, the offer to purchase and consent solicitation statement, dated March 10, 2020 (the “Offer to Purchase and Consent Solicitation”), and the separate consent solicitation statement, dated March 10, 2020 (the “2027 Consent Solicitation” and, together with the Offer to Purchase and Consent Solicitation, the “Offer to Purchase and Consent Solicitation Statements”). On March 24, 2020, the Company entered into a Supplemental Indenture with respect to the Indenture and Global Security for the 2022 Senior Notes (the “2022 Supplemental Indenture”) and a Supplemental Indenture with respect to the Indenture and Global Security for the 2027 Senior Notes (the “2027 Supplemental Indenture” and, together with the 2022 Supplemental Indenture, the “Supplemental Indentures”) effecting the Proposed Amendments.

On June 30, 2020, upon consummation of the Apollo Merger and the satisfaction of certain other conditions, Merger Sub accepted and paid for approximately $434.1 million principal amount of the 2022 Senior Notes and approximately $369.4 million principal amount of the 2027 Senior Notes.

Asset Based Credit Agreement

On June 30, 2020, as part of the Apollo Merger transaction, the Company entered into an approximately $4.9 billion Asset Based Credit Agreement (the “ABL”) with a syndicate of banks. The ABL is comprised of (i) a $2.8 billion revolving credit facility (the “ABL Revolver”), (ii) a $1.7 billion Non- First-In Last-Out (“FILO”) Term Loan and (iii) a $370 million FILO Term Loan. The ABL facilities constitute senior debt of the Company that is secured by a first priority lien by a pledge of Tech Data Corporation’s capital stock directly held by Tiger Midco and first-priority security interests in substantially all of Tech Data Corporation’s accounts receivable, inventory, general intangibles (other than intellectual property), bank accounts and cash, and books and records related to the foregoing, in each case, subject to certain exceptions.

The ABL Revolver provides for (i) a maturity date of June 30, 2025 (ii) an interest rate on borrowings, facility fees and letter of credit fees based on average availability under the ABL Revolver and (iii) certain subsidiaries of the Company to be designated as borrowers. The applicable borrower pays interest on advances under the ABL Revolver based on LIBOR (or similar interbank offered rate depending on currency draw) plus a predetermined margin that is based on the Company’s average revolving availability.

The Non-FILO Term Loan and FILO Term Loan (collectively, the “ABL Term Loans”) have a maturity date of June 30, 2025. The Company pays interest at a variable rate based on LIBOR (or similar interbank offered rate depending on currency draw) plus, in each case, a fixed predetermined margin. The Company entered into two interest rate swaps which convert the interest payable on the ABL Term Loans from a variable

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rate to a fixed rate (see Note 8 – Derivative Instruments for further discussion). The Company must repay 0.25% of the original principal amount of the ABL Term Loans on a quarterly basis. Any refinancing through the issuance of certain debt or any repricing amendment, in either case, that constitutes a “repricing event” applicable to the ABL Term Loans resulting in a lower yield will be accompanied by a 1.00% prepayment premium or fee, as applicable, if any such repricing event occurs, (i) with respect to the Non-FILO Term Loan, at any time during the first six months after the closing date of the ABL and (ii) with respect to the FILO Term Loan, at any time during the first twelve months after the closing date of the ABL. Otherwise, the ABL Term Loans may be repaid at any time, without premium or penalty, subject to customary breakage costs, except that, subject to certain exceptions, the FILO Term Loan may not be prepaid prior to the payment in full of any amounts outstanding under the ABL Revolver and the Non-FILO Term Loan.

The ABL Revolver includes a springing financial maintenance covenant based on availability under the ABL Revolver. At April 30, 2021, the financial maintenance covenant did not apply. In addition, the ABL contains covenants that would restrict the Company’s ability to, among other things, incur certain debt and liens, make certain dividends and other restricted payments, make certain investments, sell certain assets and enter into certain transactions with affiliates. The ABL also contains certain customary events of default, including relating to a change of control. If an event of default occurs, the lenders under the ABL are entitled to take various actions, including the acceleration of amounts due under the ABL and all actions permitted to be taken by a secured creditor in respect of the collateral securing the ABL.

Other Credit Facilities

The Company has various other committed and uncommitted lines of credit, short-term loans and overdraft facilities totaling approximately $388.4 million at April 30, 2021 to support its operations. Most of these facilities are provided on an unsecured, short-term basis and are reviewed periodically for renewal.

At April 30, 2021, the Company had also issued standby letters of credit of $131.6 million. These letters of credit typically act as a guarantee of payment to certain third parties in accordance with specified terms and conditions.

NOTE 5—INCOME TAXES

The Company’s provision for income taxes decreased to $2.8 million for the first quarter of fiscal 2022 compared to $12.1 million for the first quarter of fiscal 2021. The decrease in the provision for income taxes for the three months ended April 30, 2021, as compared to the prior year is primarily due to a decrease in taxable earnings.

The Company’s effective tax rate was (845.5)% and 20.1% for the three months ended April 30, 2021 and 2020, respectively. The Company had a provision for income taxes of $2.8 million on a loss before income taxes of $0.3 million for the three months ended April 30, 2021 which results in a negative effective tax rate. The change in the effective tax rate for the three months ended April 30, 2021, as compared to the prior year, is primarily due to the impact of operating losses within certain tax jurisdictions in which the Company operates and the impact of certain discrete tax items.

NOTE 6—STOCK-BASED COMPENSATION

Equity Awards in the Parent

Subsequent to the Apollo Merger, certain of the Company’s employees have been granted equity awards (“Series B Units”) in the Parent. Series B Units entitle the holder to certain rights to receive amounts in cash upon a Substantially All Assets Sale Distribution or a Liquidation Event Distribution, each as defined in the Tiger Parent Holdings, L.P. Partnership Agreement. A total of 90,000 Series B Units are available for grant.

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Series B Units with service conditions only (“Time-based Series B Units”) vest over a five-year period from the date of grant. Series B Units with service, market and performance conditions (“Performance-based Series B Units”) vest if the total cash return to certain affiliates of Apollo (referred to as “MOIC”) upon a liquidation event exceeds certain defined thresholds while the holder of the Performance-based Series B Units is employed with the Company. Certain non-employee members of the Board of Directors of the Company have also been granted preferred shares (“Series A Units”) and common shares in the Parent that vest over a one-year period from the date of grant.

The Company recorded stock-based compensation expense of $1.3 million for the three months ended April 30, 2021 for the Time-based Series B Units. No expense was recorded for the Performance-based Series B Units as it is not considered probable that the performance conditions will be satisfied. The Company recorded stock-based compensation expense of $0.1 million for the three months ended April 30, 2021 for the Series A Units and common shares.

A summary of the Company’s year to date Time-based Series B Units activity for the three months ended April 30, 2021 is as follows:

A summary of the Company’s year to date Performance-based Series B Units activity for the three months ended April 30, 2021, assuming maximum achievement for nonvested awards, is as follows:

Equity Incentive Plans

The Company recorded $6.3 million of stock-based compensation expense during the three months ended April 30, 2020 under the 2018 Equity Incentive Plan. The 2018 Equity Incentive Plan was approved by the Company’s shareholders in June 2018 and included 2.0 million shares available for grant. Prior to the Apollo Merger, the Company awarded officers, employees, and non-employee members of the Board of Directors restricted stock, options to purchase common stock, stock appreciation rights and performance awards that were dependent upon achievement of specified performance goals. Equity-based compensation awards had a maximum term of ten years, unless a shorter period was specified by the Compensation Committee of the Board of Directors (“Compensation Committee”) or was required under local law. Awards under the plan were priced as determined by the Compensation Committee and were required to be priced at, or above, the fair market value of the Company’s common stock on the date of grant. Awards generally vested between one year and three years from the date of grant. The Company’s policy was to utilize shares of its treasury stock, to the extent available, to satisfy its obligation to issue shares upon the exercise of awards.

Pursuant to the terms of the Apollo Merger Agreement, upon closing of the Apollo Merger all nonvested RSU’s were vested, cancelled and converted into the right to receive an amount of $145 per share in cash.

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Nonvested PRSU’s were also cancelled and converted into the right to receive an amount of $145 per share in cash determined as follows: (i) for PRSU’s granted during fiscal 2019, the number of shares equaled 130% of the target shares granted and (ii) for PRSU’s granted during fiscal 2020, the number of shares equaled 110% of the target shares granted.

NOTE 7—FAIR VALUE MEASUREMENTS

The Company’s assets and liabilities carried or disclosed at fair value are classified in one of the following three categories: Level 1 – quoted market prices in active markets for identical assets and liabilities; Level 2 – inputs other than quoted market prices included in Level 1 above that are observable for the asset or liability, either directly or indirectly; and Level 3 – unobservable inputs for the asset or liability. The classification of an asset or liability within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

The following table summarizes the valuation of the Company’s assets and liabilities that are measured at fair value on a recurring basis:

The Company’s foreign currency derivative instruments are measured on a recurring basis based on foreign currency spot rates and forward rates quoted by banks or foreign currency dealers and are marked-to-market each period. The Company’s interest rate swaps are measured on a recurring basis using a discounted cash flow valuation technique considering the terms of the instrument, discount rates and projected LIBOR rates (see Note 8—Derivative Instruments for further discussion).

The estimated fair value of the Senior Notes is based upon quoted market information (Level 1). The estimated fair value of the Senior Notes was approximately $209.5 million and $199.0 million, respectively, at April 30, 2021 and January 31, 2021 and the carrying value was $198.5 million and $198.7 million, respectively,

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at April 30, 2021 and January 31, 2021. The carrying amounts of accounts receivable, accounts payable and accrued expenses approximate fair value because of the short maturity of these items. The carrying amounts of debt outstanding pursuant to revolving credit facilities and term loans approximated fair value as the majority of these instruments have variable interest rates which approximate current market rates (Level 2 criteria).

NOTE 8—DERIVATIVE INSTRUMENTS

In the ordinary course of business, the Company is exposed to movements in foreign currency exchange rates. The Company’s foreign currency risk management objective has been to protect earnings and cash flows from the impact of exchange rate changes primarily through the use of foreign currency forward contracts and cross-currency swaps.

Net Investment Hedges

In fiscal 2020, the Company entered into foreign currency forward contracts to hedge a portion of its net investment in euro denominated foreign operations which were designated as net investment hedges. The Company entered into the net investment hedges to offset the risk of change in the U.S. dollar value of the Company’s investment in a euro functional subsidiary due to fluctuating foreign exchange rates. The Company terminated these net investment hedge contracts during the first quarter of fiscal 2021. Gains and losses on the net investment hedges were recorded in other comprehensive income (loss). Amounts recorded in accumulated other comprehensive income as of June 30, 2020 were eliminated as part of purchase accounting in conjunction with the Apollo Merger. Prior to the termination of the net investment hedges, the initial fair value of hedge components excluded from the assessment of effectiveness was recognized under a systematic and rational method over the life of the hedging instrument in interest expense, net on the Consolidated Statement of Operations. The Company classifies cash flows related to the settlement of its net investment hedges as investing activities in the Consolidated Statement of Cash Flows.

The company had no net investment hedges outstanding during the three months ended April 30, 2021. The following table presents the effects of the Company’s net investment hedges on accumulated other comprehensive income (“AOCI”) and earnings for the three months ended April 30, 2020:

Cash Flow Hedges

Prior to the Apollo Merger, Merger Sub entered into two interest rate swaps in order to hedge the exposure to interest rate fluctuations on expected borrowings under the ABL in conjunction with the closing of the Apollo Merger. These interest rate swaps convert the interest payable on the ABL Term Loans from a variable rate to a fixed rate. The interest rate swaps are designated as cash flow hedges. The notional values of the interest rate swaps totaled $2.0 billion at April 30, 2021 and they are set to mature on August 29, 2025. The Company has classified cash flows related to its interest rate swaps as operating activities in the Consolidated Statement of Cash Flows. Additionally, the Company previously entered into a cross-currency swap to hedge its cash flows related to certain foreign-currency denominated debt which was designated as a cash flow hedge. The notional value of this swap was $4.5 million at January 31, 2020 and the swap matured in February 2020. The Company has classified cash flows related to the settlement of its cross-currency swap as financing activities in the Consolidated Statement of Cash Flows.

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The effective portion of changes in the fair value of derivatives designated and qualifying as cash flow hedges is initially reported as a component of other comprehensive income (loss). These gains and losses are subsequently reclassified into earnings in the same period during which the hedged transaction affects earnings and are presented in the same operating statement line item as the earnings effect of the hedged item.

The following tables present the effects of the Company’s cash flow hedges on AOCI and earnings for the three months ended April 30, 2021 and 2020:

Derivatives Not Designated as Hedges

The Company additionally utilizes forward contracts that are not designated as hedging instruments to hedge intercompany loans, accounts receivable and accounts payable. The Company’s foreign currency exposure relates primarily to international transactions where the currency collected from customers can be different from the currency used to purchase the product. The Company’s transactions in its foreign operations are denominated primarily in the following currencies: Australian dollar, British pound, Canadian dollar, Czech koruna, Danish krone, euro, Indian rupee, Indonesian rupiah, Mexican peso, Norwegian krone, Polish zloty, Singapore dollar, Swedish krona, Swiss franc and U.S. dollar.

The Company considers inventory as an economic hedge against foreign currency exposure in accounts payable in certain circumstances. This practice offsets such inventory against corresponding accounts payable denominated in currencies other than the functional currency of the subsidiary buying the inventory when determining the net exposure to be hedged using traditional forward contracts. Under this strategy, the Company would expect to increase or decrease selling prices for products purchased in foreign currencies based on fluctuations in foreign currency exchange rates affecting the underlying accounts payable. To the extent the Company incurs a foreign currency exchange loss (gain) on the underlying accounts payable denominated in the foreign currency, a corresponding increase (decrease) in gross profit would be expected as the related inventory is sold. This strategy can result in a certain degree of quarterly earnings volatility as the underlying accounts payable is remeasured using the foreign currency exchange rate prevailing at the end of each period, or settlement date if earlier, whereas the corresponding increase (decrease) in gross profit is not realized until the related inventory is sold.

The Company recognizes foreign currency exchange gains and losses on its derivative instruments not designated as hedges that are used to manage its exposures to foreign currency denominated accounts receivable

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and accounts payable as a component of “cost of products sold” which is consistent with the classification of the change in fair value upon remeasurement of the underlying hedged accounts receivable or accounts payable. The Company recognizes foreign currency exchange gains and losses on its derivative instruments not designated as hedges that are used to manage its exposures to foreign currency denominated financing transactions as a component of “other expense, net,” which is consistent with the classification of the change in fair value upon remeasurement of the underlying hedged loans. The gains and losses on the Company’s foreign currency forward contracts are largely offset by the change in the fair value of the underlying hedged assets or liabilities. The Company classifies cash flows related to the settlement of forward contracts that are not designated as hedging instruments as operating activities in the Consolidated Statement of Cash Flows.

The total amount of gains (losses) recognized in earnings on the Company’s derivatives not designated as hedges for the three months ended April 30, 2021 and 2020 are as follows: