BROWN & BROWN, INC. – 10-Q – Management’s Discussion and Analysis of Financial Condition and Results of Operations – InsuranceNewsNet

The following discussion updates the Management's Discussion and Analysis of
Financial Condition and Results of Operations contained in the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 2021, and the two
discussions should be read together.

GENERAL

Company presentation – Second quarter 2022

The following discussion should be read in conjunction with our Condensed
Consolidated Financial Statements and the related Notes to those Financial
Statements included elsewhere in this Quarterly Report on Form 10-Q. In
addition, please see "Information Regarding Non-GAAP Financial Measures" below
regarding important information on non-GAAP financial measures contained in our
discussion and analysis.

We are a diversified insurance agency, wholesale brokerage, insurance programs
and services organization headquartered in Daytona Beach, Florida. As an
insurance intermediary, our principal sources of revenue are commissions paid by
insurance companies and, to a lesser extent, fees paid directly by customers.
Commission revenues generally represent a percentage of the premium paid by an
insured and are affected by fluctuations in both premium rate levels charged by
insurance companies and the insureds' underlying "insurable exposure units,"
which are units that insurance companies use to measure or express insurance
exposed to risk (such as property values, sales or payroll levels) to determine
what premium to charge the insured. Insurance companies establish these premium
rates based upon many factors, including loss experience, risk profile and
reinsurance rates paid by such insurance companies, none of which we control. We
also operate a capitalized captive insurance facility (the "Captive") for the
purpose of having additional capacity to sell property insurance for earthquake
and wind exposed properties. The Captive buys reinsurance, limiting, but not
eliminating, the Company's exposure to underwriting losses, and revenues are
recognized as net retained earned premiums over the associated policy periods.

The volume of business from new and existing customers, fluctuations in
insurable exposure units, changes in premium rate levels, changes in general
economic and competitive conditions, a health pandemic, and the occurrence of
catastrophic weather events all affect our revenues. For example, higher levels
of inflation, which would increase the value of insurable exposure units, or a
general decline in economic activity, which could decrease the value of
insurable exposure units. Conversely, increasing costs of litigation settlements
and awards could cause some customers to seek higher levels of insurance
coverage. Historically, we have grown our revenues as a result of our focus on
net new business and acquisitions. We foster a strong, decentralized sales and
service culture, which enables responsiveness to changing business conditions
and drives accountability for results.

The term "core commissions and fees" excludes profit-sharing contingent
commissions, and therefore represents the revenues earned directly from specific
insurance policies sold, and specific fee-based services rendered. The net
change in core commissions and fees reflects the aggregate changes attributable
to: (i) net new and lost accounts; (ii) net changes in our customers' exposure
units; (iii) net changes in insurance premium rates or the commission rate paid
to us by our carrier partners; (iv) the net change in fees paid to us by our
customers; and (v) any businesses acquired or disposed of.

We also earn "profit-sharing contingent commissions," which are commissions
based primarily on underwriting results, but in select situations may reflect
additional considerations for volume, growth and/or retention. These
commissions, which are included in our commissions and fees in the Condensed
Consolidated Statements of Income, are accrued throughout the year based on
actual premiums written and are primarily received in the first and second
quarters of each subsequent year, based upon the aforementioned considerations
for the prior year(s). Over the last three years, profit-sharing contingent
commissions have averaged approximately 3.0% of commissions and fees revenue.

Fee revenues primarily relate to services other than securing coverage for our
customers, and to a lesser extent as fees negotiated in lieu of commissions. Fee
revenues are generated by: (i) our Services segment, which is primarily a
fee-based business that provides insurance-related services, including
third-party claims administration and comprehensive medical utilization
management services in both the workers' compensation and all-lines liability
arenas, as well as Medicare Set-aside services, Social Security disability and
Medicare benefits advocacy services, and claims adjusting services; (ii) our
National Programs and Wholesale Brokerage segments, which earn fees primarily
for the issuance of insurance policies on behalf of insurance companies; and
(iii) our Retail segment in our large-account customer base, where we primarily
earn fees for securing insurance for our customers, and in our automobile dealer
services ("F&I") businesses where we earn fees for assisting our customers with
creating and selling warranty and service risk management programs. Fee revenues
as a percentage of our total commissions and fees, represented 27.4% in 2021 and
26.1% in 2020.

For the three months ended June 30, 2022the growth of our total commissions and fees
was 15.5% and our consolidated organic revenue growth rate was 10.3%.

Historically, investment income has consisted primarily of interest earnings on
operating cash and where permitted, on premiums and advance premiums collected
and held in a fiduciary capacity before being remitted to insurance companies.
Our policy as it relates to the Company's capital is to invest available funds
in high-quality, short-term money-market funds and fixed income investment
securities. Investment income also includes gains and losses realized from the
sale of investments. Other income primarily reflects legal settlements and other
revenues.

Income before income taxes for the three months ended June 30, 2022 increased
from the second quarter of 2021 by $12.5 million or 6.7%, driven by net new
business, acquisitions completed in the past 12 months, and management of our
expense base which were partially

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offset by the increase in interest expense associated with higher average debt
balances from debt issued and bank financing in the first quarter of 2022 in
preparation for the closing of the acquisitions of GRP (Jersey) Holdco Limited
and its businesses ("GRP"), Orchid Underwriters Agency and CrossCover Insurance
Services ("Orchid") and BdB Limited companies ("BdB") as well as increases in
the floating rate benchmark used on our adjustable rate debt.

Information regarding non-GAAP measures

In the discussion and analysis of our results of operations, in addition to
reporting financial results in accordance with generally accepted accounting
principles ("GAAP"), we provide references to the following non-GAAP financial
measures as defined in Regulation G of the SEC rules: Total Revenues - Adjusted,
Organic Revenue, EBITDAC, EBITDAC Margin, EBITDAC - Adjusted and EBITDAC Margin
- Adjusted. We present these measures because we believe such information is of
interest to the investment community and because we believe it provides
additional meaningful methods to evaluate the Company's operating performance
from period to period on a basis that may not be otherwise apparent on a GAAP
basis due to the impact of certain items that have a high degree of variability
and that we believe are not indicative of ongoing performance. This non-GAAP
financial information should be considered in addition to, not in lieu of, the
Company's consolidated income statements and balance sheets as of the relevant
date. Consistent with Regulation G, a description of such information is
provided below and tabular reconciliations of this supplemental non-GAAP
financial information to our most comparable GAAP information are contained in
this Quarterly Report on Form 10-Q under "Results of Operations - Segment
Information."

We view Organic Revenue and Organic Revenue growth as important indicators when
assessing and evaluating our performance on a consolidated basis and for each of
our four segments, because it allows us to determine a comparable, but non-GAAP,
measurement of revenue growth that is associated with the revenue sources that
were a part of our business in both the current and prior year and that are
expected to continue in the future. We also view Total Revenues - Adjusted,
EBITDAC, EBITDAC - Adjusted, EBITDAC Margin and EBITDAC Margin - Adjusted as
important indicators when assessing and evaluating our performance, as they
present more comparable measurements of our operating margins in a meaningful
and consistent manner. As disclosed in our most recent proxy statement, we use
Organic Revenue and EBITDAC Margin as key performance metrics for our short-term
and long-term incentive compensation plans for executive officers and other key
employees.

Beginning January 1, 2022, we include guaranteed supplemental commissions
("GSCs") as part of core commissions and fees and, therefore, GSCs are a
component of Organic Revenue. All current and prior periods contained within
this Quarterly Report on Form 10-Q have been adjusted for this treatment. GSCs
are a stable source of revenue that are highly correlated to core commissions,
so isolating them separately provided no meaningful incremental value in
evaluating our revenue.

Beginning January 1, 2022, the following, in addition to the change in estimated
acquisition earn-out payables, are excluded from certain non-GAAP measures, as
we believe these amounts are not indicative of the ongoing operating performance
of the business and are not easily comparable from period-to-period:

"(Gain)/loss on disposal," a caption on our consolidated statements of income
which reflects net proceeds received as compared to net book value related to
sales of books of business and other divestiture transactions, such as the
disposal of a business through sale or closure.

"Acquisition/Integration Costs," which represent the acquisition and integration
costs (e.g., costs associated with regulatory filings, legal/accounting
services, due diligence and the costs of integrating our information technology
systems) arising out of our acquisitions of GRP, Orchid and BdB, which are not
expected to occur on an ongoing basis in the future.

The period-over-period impact of foreign currency translation ("Foreign Currency
Translation"), which is calculated by applying current-year foreign exchange
rates to the various functional currencies in our business to our reporting
currency of US dollars for the same period in the prior year.

We present the EBITDAC – Adjusted and the EBITDAC Margin – Adjusted of
the current year and prior year periods contained in this quarterly form report
10-Q so that these non-GAAP financial measures compare the two periods to the same
base.

Non-GAAP Revenue Measures

Total Revenue – Adjusted is our total revenue excluding
the period-over-period impact of foreign currency translation.

Organic Revenue is our core commissions and fees less: (i) the core commissions
and fees earned for the first 12 months by newly acquired operations; (ii)
divested business (core commissions and fees generated from offices, books of
business or niches sold or terminated during the comparable period); and (iii)
the period-over-period impact of Foreign Currency Translation. The term "core
commissions and fees" excludes profit-sharing contingent commissions and
therefore represents the revenues earned directly from specific insurance
policies sold and specific fee-based services rendered. Organic Revenue can be
expressed as a dollar amount or a percentage rate when describing Organic
Revenue growth.

Non-GAAP Earnings Measures

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EBITDAC is defined as earnings before interest, income taxes, depreciation,
amortization and change in estimated price supplements to be paid on the acquisition.

EBITDAC margin is defined as EBITDAC divided by total revenue.

EBITDAC - Adjusted is defined as EBITDAC, excluding (i) (gain)/loss on disposal,
(ii) Acquisition/Integration Costs and (iii) the period-over-period impact of
Foreign Currency Translation.

EBITDAC – Adjusted margin is defined as EBITDAC – Adjusted divided by Total
Revenues – Adjusted.

Our industry peers may provide similar supplemental non-GAAP information with
respect to one or more of these measures, although they may not use the same or
comparable terminology and may not make identical adjustments and, therefore,
comparability may be limited. This supplemental non-GAAP financial information
should be considered in addition to, and not in lieu of, the Company's Condensed
Consolidated Financial Statements.

Acquisitions

Part of our continuing business strategy is to attract high-quality insurance
intermediaries to join our operations. From 1993 through the second quarter of
2022, we acquired 590 insurance intermediary operations.

Critical accounting policies

We have had no changes to our Critical Accounting Policies as described in our
most recent Form 10-K for the year ended December 31, 2021. We believe that of
our significant accounting and reporting policies, the more critical policies
include our accounting for revenue recognition, business combinations and
purchase price allocations including potential earn-out obligations, intangible
asset impairments, non-cash stock-based compensation and reserves for
litigation. In particular, the accounting for these areas requires significant
use of judgment to be made by management. Different assumptions in the
application of these policies could result in material changes in our
consolidated financial position or consolidated results of operations. Refer to
Note 1 in the "Notes to Condensed Consolidated Financial Statements" in our
Annual Report on Form 10-K for the year ended December 31, 2021 for details
regarding our critical and significant accounting policies.

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RESULTS OF OPERATIONS FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2022 AND 2021

The following discussion and analysis regarding results of operations and
liquidity and capital resources should be considered in conjunction with the
the accompanying condensed consolidated financial statements and accompanying notes.

Financial information relating to our condensed consolidated financial results
for the three and six months ended June 30, 2022 and 2021 is as follows:

                               Three months ended June 30,                    Six months ended June 30,
(in millions, except
percentages)                2022            2021        % Change          2022          2021         % Change
REVENUES
Core commissions and
fees                     $    816.6       $  706.3           15.6 %    $  1,692.4     $ 1,494.4           13.2 %

profit sharing

contingent commissions         22.1           19.6           12.8 %          50.7          45.5           11.4 %
Investment income               0.4            0.2          100.0 %           0.6           0.5           20.0 %
Other income, net               0.6            1.2          (50.0 )%          0.8           2.2          (63.6 )%
Total revenues                839.7          727.3           15.5 %       1,744.5       1,542.6           13.1 %

EXPENSES

Employee compensation
and benefits                  412.1          395.6            4.2 %         871.0         825.1            5.6 %
Other operating
expenses                      154.0           96.3           59.9 %         280.8         190.6           47.3 %
(Gain)/loss on
disposal                       (0.7 )         (3.9 )          NMF            (0.9 )        (4.0 )          NMF
Amortization                   33.6           29.5           13.9 %          64.7          59.0            9.7 %
Depreciation                    8.9            8.8            1.1 %          17.1          16.3            4.9 %
Interest                       36.0           16.3          120.9 %          54.3          32.6           66.6 %
Change in estimated
acquisition
  earn-out payables            (3.0 )         (1.6 )          NMF            (6.4 )        (2.5 )          NMF
Total expenses                640.9          541.0           18.5 %       1,280.6       1,117.1           14.6 %
Income before income
taxes                         198.8          186.3            6.7 %         463.9         425.5            9.0 %
Income taxes                   53.6           47.0           14.0 %          98.4          86.5           13.8 %
NET INCOME               $    145.2       $  139.3            4.2 %    $    365.5     $   339.0            7.8 %
Income Before Income
Taxes
  Margin (1)                   23.7 %         25.6 %                         26.6 %        27.6 %
EBITDAC - Adjusted (2)   $    274.7       $  235.0           16.9 %    $    598.2     $   526.2           13.7 %
EBITDAC Margin -
Adjusted (2)                   32.7 %         32.4 %                         34.3 %        34.2 %
Organic Revenue growth
rate (2)                       10.3 %         14.5 %                          9.0 %        12.1 %
Employee compensation
and benefits
  relative to total
revenues                       49.1 %         54.4 %                         49.9 %        53.5 %
Other operating
expenses relative
  to total revenues            18.3 %         13.2 %                         16.1 %        12.4 %
Capital expenditures     $      8.3       $   13.7          (39.4 )%   $     18.3     $    25.1          (27.1 )%
Total assets at June
30,                                                                    $ 12,279.9     $ 9,357.9           31.2 %




(1) "Income Before Income Taxes Margin" is defined as income before income taxes
divided by total revenues.
(2) A non-GAAP financial measure.
NMF = Not a meaningful figure

Commissions and fees

Commissions and fees, including profit-sharing contingent commissions, for the
three months ended June 30, 2022 increased $112.8 million to $838.7 million, or
15.5%, over the same period in 2021. Core commissions and fees revenue for the
second quarter of 2022 increased $110.3 million, composed of (i) approximately
$72.7 million of net new and renewal business, which reflects an Organic Revenue
growth rate of 10.3%; (ii) $40.9 million from acquisitions that had no
comparable revenues in the same period of 2021; (iii) an offsetting decrease
from the impact of foreign currency translation of $1.2 million; and (iv) an
offsetting decrease of $2.1 million related to commissions and fees revenue from
business divested in the preceding twelve months. Profit-sharing contingent
commissions for the second quarter of 2022 increased by $2.5 million, or 12.8%,
compared to the same period in 2021.

For the six months ended June 30, 2022, commissions and fees, including
profit-sharing contingent commissions, increased $203.2 million to $1,743.1
million, or 13.2%, over the same period in 2021. Core commissions and fees
revenue for the six months ended June 30, 2022 increased $198.0 million,
composed of: (i) approximately $134.2 million of net new and renewal business,
which reflects an Organic Revenue growth rate of 9.0%; (ii) $70.2 million from
acquisitions that had no comparable revenues in the same period of 2021; (iii)
an offsetting decrease from the impact from foreign currency translation of $1.8
million; and (iv) an offsetting decrease of $4.5 million related to

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income from commissions and fees from divested businesses over the past 12 years
month. Conditional incentive commissions for the half-year ended June 30th,
2022
increased by $5.2 millioni.e. 11.4%, compared to the same period in 2021.

investment income

Investment income for the three months ended June 30, 2022 increased $0.2
million, or 100.0%, from the same period in 2021. Investment income for the six
months ended June 30, 2022 increased $0.1 million, or 20.0%, from the same
period in 2021. The increases were primarily driven by higher average interest
rates compared to the prior year.

Other income

Other income for the three months ended June 30, 2022 decreased $0.6 million or
50.0% as compared to the same period in 2021. Other income for the six months
ended June 30, 2022 decreased by $1.4 million or 63.6% as compared to the same
period in 2021. Other income consists primarily of non-recurring legal
settlements and other miscellaneous income and therefore can fluctuate between
comparable periods.

Employee compensation and benefits

Employee compensation and benefits expense as a percentage of total revenues was
49.1% for the three months ended June 30, 2022 as compared to 54.4% for the
three months ended June 30, 2021, and increased 4.2%, or $16.5 million. This
increase included $14.6 million of compensation costs related to stand-alone
acquisitions that had no comparable costs in the same period of 2021. Therefore,
employee compensation and benefits expense attributable to those offices that
existed in the same time periods of 2022 and 2021 increased by $1.9 million or
0.5%. This underlying employee compensation and benefits expense increase was
primarily related to: (i) increased claims associated with our self-insured
employee health plan; (ii) an increase in staff salaries attributable to salary
inflation; (iii) an increase in accrued performance bonuses; (iv) an increase in
producer compensation associated with revenue growth; partially offset by (v)
the year-over-year decrease of approximately $23.1 million in the value of
deferred compensation liabilities driven by changes in the market prices of our
employees' investment elections associated with our deferred compensation plan,
with such amount substantially offset within other operating expenses as we hold
assets to fund these liabilities that closely match the investment elections of
our employees.

Employee compensation and benefits expense as a percentage of total revenues was
49.9% for the six months ended June 30, 2022 as compared to 53.5% for the six
months ended June 30, 2021, and increased 5.6%, or $45.9 million. This increase
included $24.7 million of compensation costs related to stand-alone acquisitions
that had no comparable costs in the same period of 2021. Therefore, employee
compensation and benefits expense attributable to those offices that existed in
the same time periods of 2022 and 2021 increased by $21.2 million or 2.6%. This
underlying employee compensation and benefits expense increase was primarily
related to: (i) increased claims associated with our self-insured employee
health plan; (ii) an increase in staff salaries attributable to salary
inflation; (iii) an increase in accrued performance bonuses; (iv) an increase in
producer compensation associated with revenue growth; partially offset by (v)
the year-over-year decrease of approximately $33.7 million in the value of
deferred compensation liabilities driven by changes in the market prices of our
employees' investment elections associated with our deferred compensation plan,
which was substantially offset by other operating expenses as we hold assets to
fund these liabilities that closely match the investment elections of our
employees.

Other operating expenses

Other operating expenses represented 18.3% of total revenues for the second
quarter of 2022 as compared to 13.2% for the second quarter of 2021. Other
operating expenses for the second quarter of 2022 increased $57.7 million, or
59.9%, from the same period of 2021. The net increase included: (i) $9.2 million
of other operating expenses related to stand-alone acquisitions that had no
comparable costs in the same period of 2021; (ii) increased variable costs with
travel and entertainment being the largest driver; (iii) acquisition and
integration costs associated with the acquisitions of Orchid, GRP (which closed
at the beginning of July 2022), and BdB (which is expected to close in the third
quarter of 2022), and (iv) the year-over-year decrease of approximately $23.1
million in the value of assets held to fund the associated liabilities within
our deferred compensation plan, which was substantially offset within employee
compensation and benefits as noted above.

Other operating expenses represented 16.1% of total revenues for the six months
ended June 30, 2022, as compared to 12.4% for the six months ended June 30,
2021. Other operating expenses for the first six months of 2022 increased $90.2
million, or 47.3%, from the same period of 2021. The net increase included: (i)
$12.9 million of other operating expenses related to stand-alone acquisitions
that had no comparable costs in the same period of 2021; (ii) increased variable
costs with travel and entertainment being the largest driver; (iii) acquisition
and integration costs associated with the acquisitions of Orchid, GRP (which
closed at the beginning of July 2022), and BdB (which is expected to close in
the third quarter of 2022), and (iv) the year-over-year decrease of
approximately $33.7 million in the value of assets held to fund the associated
liabilities within our deferred compensation plan, which was substantially
offset within employee compensation and benefits as noted above.

(Gain)/Loss on sale

Gain on disposal for the second quarter of 2022 decreased $3.2 million from the
second quarter of 2021. Gain on disposal for the six months ended June 30, 2022
decreased $3.1 million from the six months ended June 30, 2021. The gains on
disposal were due to activity associated with book of business sales. Although
we do not routinely sell businesses or customer accounts, we periodically sell
an office or a book of business (one or more customer accounts) that we believe
does not produce reasonable margins or demonstrate a potential for growth, or
because doing so is in the Company's best interest.

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Amortization

Amortization expense for the second quarter of 2022 increased $4.1 million, or
13.9%, compared to the second quarter of 2021. Amortization expense for the six
months ended June 30, 2022 increased $5.7 million, or 9.7%, compared to the six
months ended June 30, 2021. These increases reflect the amortization of new
intangibles from businesses acquired within the past 12 months, partially offset
by certain intangible assets becoming fully amortized.

Depreciation

Depreciation expense for the second quarter of 2022 increased $0.1 million, or
1.1%, compared to the second quarter of 2021. Depreciation expense for the six
months ended June 30, 2022 increased $0.8 million, or 4.9%, compared to the six
months ended June 30, 2021. Changes in depreciation expense reflect the addition
of fixed assets resulting from business initiatives, and net additions of fixed
assets resulting from businesses acquired in the past 12 months, which were
partially offset by fixed assets that became fully depreciated.

Interest charges

Interest expense for the second quarter of 2022 increased $19.7 million, or
120.9%, compared to the second quarter of 2021. Interest expense for the six
months ended June 30, 2022 increased $21.7 million, or 66.6%, compared to the
first six months of 2021. These increases were due to higher average debt
balances resulting from debt issuance and bank financing in the first quarter of
2022 in preparation of the funding of Orchid, GRP (which closed at the beginning
of July 2022), and BdB (which is expected to close in the third quarter of
2022), as well as increases in the floating rate benchmark used on our
adjustable rate debt.

Change in estimated acquisition price supplement debts

Accounting Standards Codification ("ASC") Topic 805-Business Combinations is the
authoritative guidance requiring an acquirer to recognize 100% of the fair value
of acquired assets, including goodwill, and assumed liabilities (with only
limited exceptions) upon initially obtaining control of an acquired entity.
Additionally, the fair value of contingent consideration arrangements (such as
earn-out purchase price arrangements) at the acquisition date must be included
in the purchase price consideration. The recorded purchase price for
acquisitions includes an estimation of the fair value of liabilities associated
with any potential earn-out provisions. Subsequent changes in these earn-out
obligations are required to be recorded in the Condensed Consolidated Statements
of Income when incurred or reasonably estimated. Estimations of potential
earn-out obligations are typically based upon future earnings of the acquired
operations or entities, usually for periods ranging from one to three years.

The net charge or credit to the Condensed Consolidated Statements of Income for
the period is the combination of the net change in the estimated acquisition
earn-out payables balance, and the interest expense imputed on the outstanding
balance of the estimated acquisition earn-out payables.

As of June 30, 2022 and 2021, the fair values of the estimated acquisition
earn-out payables were re-evaluated based upon projected operating results and
measured at fair value on a recurring basis using unobservable inputs (Level 3)
as defined in ASC 820-Fair Value Measurement. The resulting net changes, as well
as the interest expense accretion on the estimated acquisition earn-out
payables, for the three and six months ended June 30, 2022 and 2021 were as
follows:
                                               Three months ended June 30,             Six months ended June 30,
(in millions)                                  2022                  2021              2022                 2021
Change in fair value of estimated
acquisition earn-out payables              $        (4.7 )       $        (3.3 )   $        (9.5 )       $      (6.0 )
Interest expense accretion                           1.7                   1.7               3.1                 3.5
Net change in earnings from estimated
acquisition earn-out payables              $        (3.0 )       $        

(1.6 ) $(6.4) $(2.5)

For the three months and six months ended June 30, 2022the fair value of
the estimated earn-out debts have been revalued and reduced by $4.7 million and
$9.5 millionrespectively, which resulted in credits for the Condensed
Consolidated Statements of Income, respectively.

From June 30, 2022the estimated acquisition price supplement debts amount to $232.9
million
whose $91.0 million was recorded as accounts payable and $141.9
million
was recognized in other non-current liabilities.

Income taxes

The effective tax rate on income from operations for the three months ended June
30, 2022 and 2021 was 27.0% and 25.2% respectively. The effective tax rate on
income from operations for the six months ended June 30, 2022 and 2021 was 21.2%
and 20.3%, respectively.

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RESULTS OF OPERATIONS – SEGMENT INFORMATION

As discussed in Note 12 to the Condensed Consolidated Financial Statements, we
operate four reportable segments: Retail, National Programs, Wholesale
Brokerage, and Services. On a segmented basis, changes in amortization,
depreciation and interest expenses generally result from activity associated
with acquisitions. Likewise, other revenues in each segment reflects net gains
primarily from legal settlements and miscellaneous income. As such, in
evaluating the operational efficiency of a segment, management focuses on the
Organic Revenue growth rate and EBITDAC Margin.

Reconciliation of commissions and fees included in the summary
Consolidated Statements of Income vs. Organic Revenue, a Non-GAAP Financial Report
measure, for the three months ended June 30, 2022 and 2021, including by
segment, and organic revenue growth rates for the three months ended
June 30, 2022including by segment, are as follows:

2022                    Retail (1)            National Programs          Wholesale Brokerage             Services                  Total
(in millions,
except
percentages)         2022        2021          2022         2021          2022           2021        2022         2021       2022        2021
Commissions and
fees                $ 456.9     $ 400.4     $    225.5     $ 176.2     $    112.3       $ 104.4     $  44.0      $ 44.9     $ 838.7     $ 725.9
Total change        $  56.5                 $     49.3                 $      7.9                      (0.9 )               $ 112.8
Total growth %         14.1 %                     28.0 %                      7.6 %                    (2.0 )%                 15.5 %
Profit-sharing
contingent
  commissions          (9.4 )      (8.4 )        (10.3 )      (9.0 )         (2.4 )        (2.2 )         -           -       (22.1 )     (19.6 )
Core commissions
and fees            $ 447.5     $ 392.0     $    215.2     $ 167.2     $    109.9       $ 102.2     $  44.0      $ 44.9     $ 816.6     $ 706.3
Acquisitions          (22.7 )         -          (17.7 )         -           (0.5 )           -           -           -       (40.9 )         -
Dispositions              -        (0.4 )            -        (1.0 )            -             -           -        (0.7 )         -        (2.1 )
Foreign currency
translation               -        (1.0 )            -        (0.2 )            -             -           -           -           -        (1.2 )
Organic Revenue
(2)                 $ 424.8     $ 390.6     $    197.5     $ 166.0     $    109.4       $ 102.2     $  44.0      $ 44.2     $ 775.7     $ 703.0
Organic Revenue
growth (2)          $  34.2                 $     31.5                 $      7.2                   $  (0.2 )               $  72.7
Organic Revenue
growth rate (2)         8.8 %                     19.0 %                      7.0 %                    (0.5 )%                 10.3 %


(1) The Retail Segment includes commissions and fees reported in the "Other"
column of the Segment Information in Note 12 of this 10-Q of the Notes to the
Condensed Consolidated Financial Statements, which includes corporate and
consolidation items.
(2) A non-GAAP financial measure.

Reconciliation of commissions and fees included in the summary
Consolidated Statements of Income vs. Organic Revenue, a Non-GAAP Financial Report
measure, for the three months ended June 30, 2021 and 2020, including by
segment, and organic revenue growth rates for the three months ended
June 30, 2021including by segment, are as follows:

2021                   Retail (1)            National Programs          Wholesale Brokerage             Services                 Total
(in millions,
except
percentages)        2021        2020          2021         2020          2021            2020       2021        2020       2021        2020
Commissions and
fees               $ 400.4     $ 312.0     $    176.2     $ 154.6     $     104.4       $ 88.7     $  44.9     $ 42.9     $ 725.9     $ 598.2
Total change       $  88.4                 $     21.6                 $      15.7                  $   2.0                $ 127.7
Total growth %        28.3 %                     14.0 %                      17.7 %                    4.7 %                 21.3 %
Profit-sharing
contingent
  commissions         (8.4 )      (6.9 )         (9.0 )      (9.3 )        

(2.2 ) (2.5 ) – – (19.6 ) (18.7 )
Base fees
and fees

             392.0       305.1          167.2       145.3           102.2         86.2        44.9       42.9       706.3       579.5
Acquisition
revenues           $ (36.1 )   $     -     $     (2.0 )   $     -     $      (5.9 )     $    -     $     -     $    -     $ (44.0 )   $     -
Divested
business                 -        (1.8 )            -           -               -            -           -          -           -        (1.8 )
Foreign currency
translation              -           -              -         0.5               -            -           -          -           -         0.5
Organic Revenue
(2)                $ 355.9     $ 303.3     $    165.2     $ 145.8     $      96.3       $ 86.2     $  44.9     $ 42.9     $ 662.3     $ 578.2
Organic Revenue
growth (2)         $  52.6                 $     19.4                 $      10.1                  $   2.0                $  84.1
Organic Revenue
growth rate (2)       17.3 %                     13.3 %                      11.7 %                    4.7 %                 14.5 %


(1) The Retail Segment includes commissions and fees reported in the "Other"
column of the Segment Information in Note 12 of the Notes to the Condensed
Consolidated Financial Statements, which includes corporate and consolidation
items.
(2) A non-GAAP financial measure.


                                       34
--------------------------------------------------------------------------------

The reconciliation of commissions and fees included in the Condensed
Consolidated Statements of Income to Organic Revenue, a non-GAAP financial
measure, for the six months ended June 30, 2022 and 2021, including by segment,
and the growth rates for Organic Revenue for the six months ended June 30, 2022,
including by segment, are as follows:

2022                     Retail (1)             National Programs          Wholesale Brokerage              Services                    Total
(in millions,
except
percentages)          2022         2021          2022         2021          2022           2021        2022         2021         2022          2021
Commissions and
fees                $ 1,052.9     $ 922.2     $    387.6     $ 330.7     $    215.0       $ 195.1     $  87.6      $  91.9     $ 1,743.1     $ 1,539.9
Total change        $   130.7                 $     56.9                 $     19.9                   $  (4.3 )                $   203.2
Total growth %           14.2 %                     17.2 %                     10.2 %                    (4.7 )%                    13.2 %
Profit-sharing
contingent
  commissions           (27.4 )     (24.1 )        (18.3 )     (17.3 )         (5.0 )        (4.1 )         -            -         (50.7 )       (45.5 )
Core commissions
and fees              1,025.5       898.1          369.3       313.4          210.0         191.0        87.6         91.9       1,692.4       1,494.4
Acquisitions        $   (51.1 )   $     -     $    (17.7 )   $     -     $     (1.4 )     $     -     $     -      $     -     $   (70.2 )   $       -
Dispositions                -        (1.2 )            -        (2.1 )            -             -           -         (1.2 )           -          (4.5 )
Foreign currency
translation                 -        (1.7 )            -        (0.1 )            -             -           -            -             -          (1.8 )
Organic Revenue
(2)                     974.4       895.2          351.6       311.2          208.6         191.0        87.6         90.7       1,622.2       1,488.1
Organic Revenue
growth (2)          $    79.2                 $     40.4                 $     17.6                   $  (3.1 )                $   134.1
Organic Revenue
growth % (2)              8.8 %                     13.0 %                      9.2 %                    (3.4 )%                     9.0 %


(1) The Retail Segment includes commissions and fees reported in the "Other"
column of the Segment Information in Note 12 of the Notes to the Condensed
Consolidated Financial Statements, which includes corporate and consolidation
items.
(2) A non-GAAP financial measure.

The reconciliation of commissions and fees included in the Condensed
Consolidated Statements of Income to Organic Revenue, a non-GAAP financial
measure, for the six months ended June 30, 2021 and 2020, including by segment,
and the growth rates for Organic Revenue for the six months ended June 30, 2021,
including by segment, are as follows:

2021                    Retail (1)            National Programs          Wholesale Brokerage             Services                    Total
(in millions,
except
percentages)         2021        2020          2021         2020          2021           2020        2021         2020        2021          2020
Commissions and
fees                $ 922.2     $ 758.3     $    330.7     $ 282.7     $    195.1       $ 166.3     $  91.9      $ 87.4     $ 1,539.9     $ 1,294.7
Total change        $ 163.9                 $     48.0                 $     28.8                   $  (4.5 )               $   245.2
Total growth %         21.6 %                     17.0 %                     17.3 %                    (5.1 )%                   18.9 %
Profit-sharing
contingent
  commissions         (24.1 )     (23.0 )        (17.3 )     (15.0 )         (4.1 )        (4.6 )         -           -         (45.5 )       (42.6 )
Core commissions
and fees            $ 898.1     $ 735.3     $    313.4     $ 267.7     $    

191.0 $161.7 $91.9 $87.4 $1,494.4 $1,252.1
Acquisition
income

              (70.2 )         -           (8.2 )         -          (14.3 )           -           -           -         (92.7 )           -
Divested business         -        (2.1 )            -           -              -             -           -           -             -          (2.1 )
Foreign currency
translation               -           -              -         0.8              -             -           -           -             -           0.8
Organic Revenue
(2)                   827.9     $ 733.2          305.2     $ 268.5     $    176.7       $ 161.7     $  91.9      $ 87.4     $ 1,401.7     $ 1,250.8
Organic Revenue
growth (2)             94.7                       36.7                 $     15.0                   $   4.5                 $   150.9
Organic Revenue
growth % (2)           12.9 %                     13.7 %                      9.3 %                     5.1 %                    12.1 %


(1) The Retail Segment includes commissions and fees reported in the "Other"
column of the Segment Information in Note 12 of the Notes to the Condensed
Consolidated Financial Statements, which includes corporate and consolidation
items.
(2) A non-GAAP financial measure.

                                       35
--------------------------------------------------------------------------------


The reconciliation of Total Revenues to Total Revenues - Adjusted, a non-GAAP
measure, income before incomes taxes, included in the Condensed Consolidated
Statement of Income, to EBITDAC, a non-GAAP measure, and EBITDAC - Adjusted, a
non-GAAP measure, and Income Before Income Taxes Margin to EBITDAC Margin, a
non-GAAP measure, and EBITDAC Margin - Adjusted, a non-GAAP measure, for the
three months ended June 30, 2022, including by segment, is as follows:

                                          National       Wholesale
(in millions)                Retail       Programs       Brokerage       Services       Other        Total
Total Revenues              $  457.6     $    225.7     $     112.4     $     44.0     $      -     $  839.7
Foreign Currency
Translation                        -              -               -              -            -            -
Total Revenues -
Adjusted(2)                    457.6          225.7           112.4           44.0            -        839.7
Income before income
taxes                           82.5           76.5            33.8            6.6         (0.6 )      198.8
Income Before Income
Taxes Margin(1)                 18.0 %         33.9 %          30.1 %         15.0 %        NMF         23.7 %
Amortization                    20.5            9.8             2.0            1.3            -         33.6
Depreciation                     2.6            3.5             0.6            0.4          1.8          8.9
Interest                        23.5           10.4             3.3            0.5         (1.7 )       36.0
Change in estimated
acquisition
  earn-out payables              0.6            0.1            (3.7 )            -            -         (3.0 )
EBITDAC(2)                     129.7          100.3            36.0            8.8         (0.5 )      274.3
EBITDAC Margin(2)               28.3 %         44.4 %          32.0 %         20.0 %        NMF         32.7 %
(Gain)/loss on disposal         (0.9 )            -             0.2              -            -         (0.7 )

Acquisition/Integration

Costs                            0.8              -             0.3              -            -          1.1
Foreign Currency
Translation                        -              -               -              -            -            -
EBITDAC - Adjusted(2)       $  129.6     $    100.3     $      36.5     $      8.8     $   (0.5 )   $  274.7
EBITDAC Margin -
Adjusted(2)                     28.3 %         44.4 %          32.5 %         20.0 %        NMF         32.7 %


(1) "Income Before Income Taxes Margin" is defined as income before income taxes
divided by total revenues.
(2) A non-GAAP financial measure.
NMF = Not a meaningful figure

The reconciliation of Total Revenues to Total Revenues - Adjusted, a non-GAAP
measure, income before incomes taxes, included in the Condensed Consolidated
Statement of Income, to EBITDAC - Adjusted, a non-GAAP measure, and Income
Before Income Taxes Margin to EBITDAC Margin - Adjusted, a non-GAAP measure, for
the three months ended June 30, 2021, including by segment, is as follows:


                                           National        Wholesale
(in millions)                 Retail       Programs        Brokerage        Services       Other        Total
Total Revenues               $  401.1     $    176.3     $       104.6     $     44.9     $    0.4     $  727.3
Foreign Currency
Translation                      (1.0 )         (0.1 )               -              -            -         (1.1 )
Total Revenues -
Adjusted(2)                     400.1          176.2             104.6           44.9          0.4        726.2
Income before income taxes       70.5           66.7              26.4            7.7         15.0        186.3
Income Before Income Taxes
Margin(1)                        17.6 %         37.8 %            25.2 %         17.1 %        NMF         25.6 %
Amortization                     19.0            6.9               2.4            1.3            -         29.5
Depreciation                      2.8            2.3               0.7            0.4          2.6          8.8
Interest                         22.6            2.9               4.1            0.7        (14.0 )       16.3
Change in estimated
acquisition
  earn-out payables               4.4           (8.1 )             2.1              -            -         (1.6 )
EBITDAC(2)                      119.3           70.7              35.7           10.1          3.6        239.3
EBITDAC Margin(2)                29.7 %         40.1 %            34.1 %         22.5 %        NMF         32.9 %
(Gain)/loss on disposal          (3.9 )            -                 -              -            -         (3.9 )

Acquisition/Integration

Costs                               -              -                 -              -            -            -
Foreign Currency
Translation                      (0.3 )         (0.1 )               -              -            -         (0.4 )
EBITDAC - Adjusted(2)        $  115.1     $     70.6     $        35.7     $     10.1     $    3.6     $  235.0
EBITDAC Margin -
Adjusted(2)                      28.8 %         40.1 %            34.1 %         22.5 %        NMF         32.4 %


(1) "Income Before Income Taxes Margin" is defined as income before income taxes
divided by total revenues.
(2) A non-GAAP financial measure.
NMF = Not a meaningful figure

The reconciliation of Total Revenues to Total Revenues - Adjusted, a non-GAAP
measure, income before incomes taxes, included in the Condensed Consolidated
Statement of Income, to EBITDAC - Adjusted, a non-GAAP measure, and Income
Before Income Taxes Margin to EBITDAC Margin - Adjusted, a non-GAAP measure, for
the six months ended June 30, 2022, including by segment, is as follows:


                                       36
--------------------------------------------------------------------------------
                                             National        Wholesale
(in millions)                  Retail        Programs        Brokerage        Services       Other         Total
Total Revenues                $ 1,054.0     $    387.9     $       215.3     $     87.6     $   (0.3 )   $ 1,744.5
Foreign Currency
Translation                           -              -                 -              -            -             -
Total Revenues -
Adjusted(2)                     1,054.0          387.9             215.3           87.6         (0.3 )     1,744.5
Income before income taxes        266.5          118.1              59.5           13.2          6.6         463.9
Income Before Income Taxes
Margin(1)                          25.3 %         30.4 %            27.6 %         15.1 %        NMF          26.6 %
Amortization                       41.6           16.5               4.0            2.6            -          64.7
Depreciation                        5.2            6.3               1.3            0.8          3.5          17.1
Interest                           47.1           12.6               6.8            1.1        (13.3 )        54.3
Change in estimated
acquisition
  earn-out payables                (3.1 )          0.2              (3.5 )            -            -          (6.4 )
EBITDAC(2)                        357.3          153.7              68.1           17.7         (3.2 )       593.6
EBITDAC Margin(2)                  33.9 %         39.6 %            31.6 %         20.2 %        NMF          34.0 %
(Gain)/loss on disposal            (1.1 )            -               0.2              -            -          (0.9 )
Acquisition/Integration
Costs                               3.1            0.3               0.7              -          1.4           5.5
Foreign Currency
Translation                           -              -                 -              -            -             -
EBITDAC - Adjusted(2)         $   359.3     $    154.0     $        69.0     $     17.7     $   (1.8 )   $   598.2
EBITDAC Margin -
Adjusted(2)                        34.1 %         39.7 %            32.0 %         20.2 %        NMF          34.3 %


(1) "Income Before Income Taxes Margin" is defined as income before income taxes
divided by total revenues.
(2) A non-GAAP financial measure.
NMF = Not a meaningful figure

The reconciliation of Total Revenues to Total Revenues - Adjusted, a non-GAAP
measure, income before incomes taxes, included in the Condensed Consolidated
Statement of Income, to EBITDAC - Adjusted, a non-GAAP measure, and Income
Before Income Taxes Margin to EBITDAC Margin - Adjusted, a non-GAAP measure, for
the six months ended June 30, 2021, including by segment, is as follows:
                                           National        Wholesale
(in millions)                 Retail       Programs        Brokerage        Services       Other         Total
Total Revenues               $  924.0     $    331.2     $       195.4     $     91.9     $    0.1     $ 1,542.6
Foreign Currency
Translation                      (1.7 )         (0.1 )               -              -            -          (1.8 )
Total Revenues -
Adjusted(2)                     922.3          331.1             195.4           91.9          0.1       1,540.8
Income before income taxes      221.6          107.9              45.1           16.9         33.9         425.4
Income Before Income Taxes
Margin(1)                        24.0 %         32.6 %            23.1 %         18.4 %        NMF          27.6 %
Amortization                     37.8           13.7               4.8            2.7            -          59.0
Depreciation                      5.6            4.5               1.3            0.7          4.2          16.3
Interest                         45.2            7.0               8.3            1.5        (29.4 )        32.6
Change in estimated
acquisition
  earn-out payables               3.5           (8.3 )             2.3              -            -          (2.5 )
EBITDAC(2)                      313.7          124.8              61.8           21.8          8.7         530.8
EBITDAC Margin(2)                34.0 %         37.7 %            31.6 %         23.7 %        NMF          34.4 %
(Gain)/loss on disposal          (4.0 )            -                 -              -            -          (4.0 )
Acquisition/Integration
Costs                               -              -                 -              -            -             -
Foreign Currency
Translation                      (0.6 )            -                 -              -            -          (0.6 )
EBITDAC - Adjusted(2)        $  309.1     $    124.8     $        61.8     $     21.8     $    8.7     $   526.2
EBITDAC Margin -
Adjusted(2)                      33.5 %         37.7 %            31.6 %         23.7 %        NMF          34.2 %


(1) "Income Before Income Taxes Margin" is defined as income before income taxes
divided by total revenues.
(2) A non-GAAP financial measure.
NMF = Not a meaningful figure

Retail Segment

The Retail segment provides a broad range of insurance products and services to
commercial, public and quasi-public, professional and individual insured
customers, and non-insurance risk-mitigating products through our F&I
businesses. Approximately 76.4% of the Retail segment's commissions and fees
revenue is commission based.

                                       37
--------------------------------------------------------------------------------

Financial information relating to our Retail segment for the three and six
months ended June 30, 2022 and 2021 is as follows:

                               Three months ended June 30,                   Six months ended June 30,
(in millions, except
percentages)               2022            2021         % Change         2022          2021         % Change
REVENUES
Core commissions and
fees                    $    447.8       $   392.6           14.1 %    $ 1,026.1     $   899.1           14.1 %
Profit-sharing
contingent
commissions                    9.4             8.4           11.9 %         27.4          24.1           13.7 %
Investment income                -               -              - %            -             -              - %
Other income, net              0.4             0.1          300.0 %          0.5           0.8          (37.5 )%
Total revenues               457.6           401.1           14.1 %      1,054.0         924.0           14.1 %

EXPENSES

Employee compensation
and benefits                 247.9           222.1           11.6 %        536.0         485.0           10.5 %
Other operating
expenses                      80.9            63.6           27.2 %        161.8         129.3           25.1 %
(Gain)/loss on
disposal                      (0.9 )          (3.9 )          NMF           (1.1 )        (4.0 )          NMF
Amortization                  20.5            19.0            7.9 %         41.6          37.8           10.1 %
Depreciation                   2.6             2.8           (7.1 %)         5.2           5.6           (7.1 %)
Interest                      23.5            22.6            4.0 %         47.1          45.2            4.2 %
Change in estimated
acquisition
  earn-out payables            0.6             4.4            NMF           (3.1 )         3.5            NMF
Total expenses               375.1           330.6           13.5 %        787.5         702.4           12.1 %
Income before income
taxes                   $     82.5       $    70.5           17.0 %    $   266.5     $   221.6           20.3 %
Income Before Income
Taxes
  Margin (1)                  18.0 %          17.6 %                        25.3 %        24.0 %
EBITDAC - Adjusted
(2)                     $    129.6       $   115.1           12.6 %    $   359.3     $   309.1           16.2 %
EBITDAC Margin -
Adjusted (2)                  28.3 %          28.8 %                        34.1 %        33.5 %
Organic Revenue
growth rate (2)                8.8 %          17.3 %                         8.8 %        12.9 %
Employee compensation
and benefits
  relative to total
revenues                      54.2 %          55.4 %                        50.9 %        52.5 %
Other operating
expenses relative
  to total revenues           17.7 %          15.9 %                        15.4 %        14.0 %
Capital expenditures    $      2.1       $     1.4           50.0 %    $     3.7     $     3.7              - %
Total assets at June
30,                                                                    $ 5,036.3     $ 7,393.3          (31.9 %)




(1) "Income Before Income Taxes Margin" is defined as income before income taxes
divided by total revenues.
(2) A non-GAAP financial measure.
NMF = Not a meaningful figure


The Retail Segment's total revenues for the three months ended June 30, 2022
increased 14.1%, or $56.5 million, as compared to the same period in 2021, to
$457.6 million. The $55.2 million increase in core commissions and fees revenue
was driven by: (i) approximately $22.7 million related to the core commissions
and fees revenue from acquisitions that had no comparable revenues in the same
period of 2021; (ii) an increase of $34.2 million related to net new and renewal
business; (iii) an offsetting decrease from the impact of foreign currency
translation of $1.0 million; and (iv) an offsetting decrease of $0.4 million
related to commissions and fees recorded in 2021 from businesses since divested.
Profit-sharing contingent commissions for the second quarter of 2022 increased
11.9%, or $1.0 million, as compared to the same period in 2021, to $9.4 million.
This increase was the result of recent acquisitions and qualifying for certain
profit-sharing contingent commissions in 2022 that we did not qualify for in the
prior year. The Retail Segment's total commissions and fees increased by 14.1%,
and the Organic Revenue growth rate was 8.8% for the second quarter of 2022. The
Organic Revenue growth rate was driven by net new business written during the
preceding 12 months and growth on renewals of existing customers. Renewal
business was impacted by rate increases in most lines of business with continued
increases in commercial P&C, employee benefits, professional and excess
liability, and condo property, partially offset by continued premium rate
reductions in workers' compensation.

Income before income taxes for the three months ended June 30, 2022 increased
17.0%, or $12.0 million, as compared to the same period in 2021, to $82.5
million. The primary factors affecting this increase were: (i) the profit
associated with the net increase in revenue as described above; (ii)
intercompany interest and amortization expenses growing slower than total
revenues; and (iii) a decrease to the change in estimated acquisition earn-out
payables.

EBITDAC - Adjusted for the three months ended June 30, 2022 increased 12.6%, or
$14.5 million, as compared to the same period in 2021, to $129.6 million.
EBITDAC Margin - Adjusted for the three months ended June 30, 2022 decreased to
28.3% from 28.8% in the same period in 2021. The decrease in EBITDAC Margin -
Adjusted was driven by: (i) increased variable operating expenses, which are
largely travel and meeting related and (ii) partially offset by the total
revenue increase.

                                       38
--------------------------------------------------------------------------------


The Retail Segment's total revenues for the six months ended June 30, 2022
increased 14.1%, or $130.0 million, as compared to the same period in 2021, to
$1,054.0 million. The $127.0 million increase in core commissions and fees
revenue was driven by: (i) approximately $51.1 million related to the core
commissions and fees revenue from acquisitions that had no comparable revenues
in the same period of 2021; (ii) an increase of $79.2 million related to net new
and renewal business; (iii) an offsetting decrease from the impact of foreign
currency translation of $1.7 million; and (iv) an offsetting decrease of $1.2
million related to commissions and fees recorded in 2021 from businesses since
divested. Profit-sharing contingent commissions for the six months of 2022
increased 13.7%, or $3.3 million, as compared to the same period in 2021, to
$27.4 million. The Retail Segment's total commissions and fees increased by
14.1%, and the Organic Revenue growth rate was 8.8% for the first six months of
2022. The Organic Revenue growth rate was driven by net new business written
during the preceding 12 months and growth on renewals of existing customers.
Renewal business was impacted by rate increases in most lines of business with
continued increases in commercial P&C, employee benefits, professional and
excess liability, and condo partially offset by continued premium rate
reductions in workers' compensation.

Income before income taxes for the six months ended June 30, 2022 increased
20.3%, or $44.9 million, as compared to the same period in 2021, to $266.5
million. The primary factors affecting this increase were: (i) the profit
associated with the net increase in revenue as described above; and (ii) the
drivers of EBITDAC described below; (iii) intercompany interest and amortization
growing slower than total revenues; and (iv) a decrease in the change in
estimated acquisition earn-out payables.

EBITDAC - Adjusted for the six months ended June 30, 2022 increased 16.2%, or
$50.2 million, as compared to the same period in 2021, to $359.3 million.
EBITDAC Margin - Adjusted for the six months ended June 30, 2022 increased to
34.1% from 33.5% in the same period in 2021. The increases in EBITDAC Margin -
Adjusted were primarily driven by leveraging our expenses in connection with the
net increase in revenue of $130.0 million which was partially offset by
increased variable operating expenses.

                                       39
--------------------------------------------------------------------------------

National programs segment

The National Programs Segment manages over 40 programs supported by
approximately 100 well-capitalized carrier partners. In most cases, the
insurance carriers that support these programs have delegated underwriting and,
in many instances, claims-handling authority to our programs operations. These
programs are generally distributed through a nationwide network of independent
agents and Brown & Brown retail agents, and offer targeted products and services
designed for specific industries, trade groups, professions, public entities and
market niches. The National Programs Segment operations can be grouped into five
broad categories: Professional Programs, Personal Lines Programs, Commercial
Programs, Public Entity-Related Programs and Specialty Programs. Approximately
75.2% of the National Programs Segment's commissions and fees revenue is
commission based.

Financial information relating to our National Programs segment for the three
and six months ended June 30, 2022 and 2021 is as follows:

                               Three months ended June 30,                  Six months ended June 30,
(in millions, except
percentages)               2022            2021         % Change        2022          2021         % Change
REVENUES
Core commissions and
fees                    $    215.2       $   167.2           28.7 %   $   369.3     $   313.4           17.8 %
Profit-sharing
contingent
commissions                   10.3             9.0           14.4 %        18.3          17.3            5.8 %
Investment income              0.2             0.1          100.0 %         0.3           0.3              - %
Other income, net                -               -              - %           -           0.2              - %
Total revenues               225.7           176.3           28.0 %       387.9         331.2           17.1 %
EXPENSES
Employee compensation
and benefits                  78.4            73.0            7.4 %       151.9         144.0            5.5 %
Other operating
expenses                      47.0            32.6           44.2 %        82.3          62.4           31.9 %
(Gain)/loss on
disposal                         -               -              - %           -             -              - %
Amortization                   9.8             6.9           42.0 %        16.5          13.7           20.4 %
Depreciation                   3.5             2.3           52.2 %         6.3           4.5           40.0 %
Interest                      10.4             2.9          258.6 %        12.6           7.0           80.0 %
Change in estimated
acquisition
  earn-out payables            0.1            (8.1 )          NMF           0.2          (8.3 )          NMF
Total expenses               149.2           109.6           36.1 %       269.8         223.3           20.8 %
Income before income
taxes                   $     76.5       $    66.7           14.7 %   $   118.1     $   107.9            9.5 %
Income Before Income
Taxes
  Margin (1)                  33.9 %          37.8 %                       30.4 %        32.6 %
EBITDAC - Adjusted
(2)                     $    100.3       $    70.6           42.1 %   $   154.0     $   124.8           23.4 %
EBITDAC Margin -
Adjusted (2)                  44.4 %          40.1 %                       39.7 %        37.7 %
Organic Revenue
growth rate (2)               19.0 %          13.3 %                       13.0 %        13.7 %
Employee compensation
and benefits
  relative to total
revenues                      34.7 %          41.4 %                       39.2 %        43.5 %
Other operating
expenses relative
  to total revenues           20.8 %          18.5 %                       21.2 %        18.8 %
Capital expenditures    $      5.3       $     3.6           47.2 %   $    11.0     $     6.6           66.7 %
Total assets at June
30,                                                                   $ 3,554.9     $ 3,570.8           (0.4 )%




(1) "Income Before Income Taxes Margin" is defined as income before income taxes
divided by total revenues.
(2) A non-GAAP financial measure.
NMF = Not a meaningful figure

The National Programs Segment's total revenue for the three months ended June
30, 2022 increased 28.0%, or $49.4 million, as compared to the same period in
2021, to $225.7 million. The $48.0 million increase in core commissions and fees
revenue was driven by: (i) approximately $31.5 million of net new and renewal
business; (ii) $17.7 million from acquisitions that had no comparable revenues
in the same period of 2021; (iii) an offsetting decrease from the impact of
foreign currency translation of $0.2 million; and (iv) an offsetting decrease of
$1.0 million related to commissions and fees revenue from business divested in
the preceding twelve months. Profit-sharing contingent commissions for the
second quarter of 2022 increased approximately $1.3 million or 14.4% as compared
to the second quarter of 2021.

The National Programs Segment's total commissions and fees increase by 28.7%,
and the Organic Revenue growth rate was 19.0% for the three months ended June
30, 2022. The Organic Revenue growth was driven primarily by new business and
good retention, exposure unit expansion and rate increases for many programs.

                                       40
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Income before income taxes for the three months ended June 30, 2022 increased
14.7%, or $9.8 million, as compared to the same period in 2021, to $76.5
million. Income before income taxes increased due to the drivers of EBITDAC
described below partially offset by an increase in intercompany interest expense
and amortization expense.

EBITDAC - Adjusted for the three months ended June 30, 2022 increased 42.1%, or
$29.7 million, from the same period in 2021, to $100.3 million. EBITDAC Margin -
Adjusted for the three months ended June 30, 2022 increased to 44.4% from 40.1%
in the same period in 2021. The EBITDAC - Adjusted growth was due to the strong
Organic Revenue growth, recent acquisitions, increased profit-sharing contingent
commissions, leveraging our expense base, as well as the timing of revenue and
expenses in the prior year associated with the onboarding of new customers in
one of our programs.

The National Programs Segment's total revenue for the six months ended June 30,
2022 increased 17.1%, or $56.7 million, as compared to the same period in 2021,
to $387.9 million. The $55.9 million increase in core commissions and fees
revenue was driven by: (i) approximately $40.4 million of net new and renewal
business; (ii) $17.7 million from acquisitions that had no comparable revenues
in the same period of 2021; (iii) an offsetting decrease from the impact of
foreign currency translation of $0.1 million; and (iv) an offsetting decrease of
$2.1 million related to commissions and fees revenue from business divested in
the preceding twelve months.

The National Programs Segment's total commissions and fees increase by 17.8%,
and the Organic Revenue growth rate was 13.0%, for the six months ended June 30,
2022. The Organic Revenue growth was driven primarily by good new business and
retention, exposure unit expansion and rate increases for many programs.

Income before income taxes for the six months ended June 30, 2022 increased
9.5%, or $10.2 million, from the same period in 2021, to $118.1 million. Income
before income taxes increased due to the drivers of EBITDAC described below
partially offset by an increase in intercompany interest expense and increased
amortization expense.

EBITDAC - Adjusted for the six months ended June 30, 2022 increased 23.4%, or
$29.2 million, as compared to the same period in 2021, to $154.0 million.
EBITDAC Margin - Adjusted for the six months ended June 30, 2022 increased to
39.7% from 37.7% in the same period in 2021. The increase in EBITDAC - Adjusted
and EBITDAC Margin - Adjusted was driven by strong Organic Revenue growth,
recent acquisitions, increased profit-sharing contingent commissions, leveraging
our expense base, as well as the timing of expenses in the prior year associated
with the onboarding of new customers in one of our programs.

                                       41
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Wholesale brokerage segment

The Wholesale Brokerage Segment markets and sells excess and surplus commercial
and personal lines insurance, primarily through independent agents and brokers,
including Brown & Brown retail agents. Approximately 83.3% of the Wholesale
Brokerage Segment's commissions and fees revenue is commission based.

Financial information relating to our Wholesale Brokerage segment for the three
and six months ended June 30, 2022 and 2021 is as follows:

                             Three months ended June 30,                      Six months ended June 30,
(in millions,
except percentages)      2022             2021         % Change          2022           2021         % Change

REVENUES

Core commissions
and fees              $    109.9       $    102.3            7.4 %    $    210.0     $    191.0             9.9 %
Profit-sharing
contingent
commissions                  2.4              2.2            9.1 %           5.0            4.1            22.0 %
Investment income              -                -              - %           0.1            0.1               - %
Other income, net            0.1              0.1              - %           0.2            0.2               - %
Total revenues             112.4            104.6            7.5 %         215.3          195.4            10.2 %

EXPENSES

Employee

compensation and
benefits                    59.1             54.1            9.2 %         114.1          104.7             9.0 %
Other operating
expenses                    17.1             14.8           15.5 %          32.9           28.9            13.8 %
(Gain)/loss on
disposal                     0.2                -              - %           0.2              -               - %
Amortization                 2.0              2.4          (16.7 %)          4.0            4.8           (16.7 %)
Depreciation                 0.6              0.7          (14.3 %)          1.3            1.3               - %
Interest                     3.3              4.1          (19.5 %)          6.8            8.3           (18.1 %)
Change in estimated
acquisition
  earn-out payables         (3.7 )            2.1            NMF            (3.5 )          2.3             NMF
Total expenses              78.6             78.2            0.5 %        155.80          150.3             3.7 %
Income before
income taxes          $     33.8       $     26.4           28.0 %    $     59.5     $     45.1            31.9 %
Income Before
Income Taxes
  Margin (1)                30.1 %           25.2 %                         27.6 %         23.1 %
EBITDAC - Adjusted
(2)                   $     36.5       $     35.7            2.2 %    $     69.0     $     61.8            11.7 %
EBITDAC Margin -
Adjusted (2)                32.5 %           34.1 %                         32.0 %         31.6 %
Organic Revenue
growth rate (2)              7.0 %           11.7 %                          9.2 %          9.3 %
Employee
compensation and
benefits
  relative to total
revenues                    52.6 %           51.7 %                         53.0 %         53.6 %
Other operating
expenses relative
to
  total revenues            15.2 %           14.1 %                         15.3 %         14.8 %
Capital
expenditures          $      0.4       $      0.6          (33.3 )%   $      0.8     $      1.1           (27.3 )%
Total assets at
June 30,                                                              $  1,149.0     $  1,844.3           (37.7 %)




(1) "Income Before Income Taxes Margin" is defined as income before income taxes
divided by total revenues.
(2) A non-GAAP financial measure.
NMF = Not a meaningful figure

The Wholesale Brokerage Segment's total revenues for the three months ended June
30, 2022 increased 7.5%, or $7.8 million, as compared to the same period in
2021, to $112.4 million. The $7.6 million net increase in core commissions and
fees revenue was driven primarily by: (i) $7.2 million related to net new and
renewal business; and (ii) $0.5 million related to the core commissions and fees
revenue from acquisitions that had no comparable revenues in the same period of
2021. Profit-sharing contingent commissions for the second quarter of 2022
increased $0.2 million compared to the second quarter of 2021. The Wholesale
Brokerage Segment's growth rate for total commissions and fees was 7.4%, and the
Organic Revenue growth rate was 7.0% for the second quarter of 2022. The Organic
Revenue growth rate was driven by new business, good retention as well as rate
increases for most lines of coverage. However, the Organic Revenue growth was
also impacted by declines in our personal lines business caused by reduced
carrier appetite to write coverage in certain geographies or lines of business.

                                       42
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Income before income taxes for the three months ended June 30, 2022 increased
28.0%, or $7.4 million, as compared to the same period in 2021, to $33.8
million. The increase was due to: (i) decrease in the change in estimated
acquisition earn-out payables; (ii) lower intercompany interest expense; and
(iii) the drivers of EBITDAC - Adjusted described below; partially offset by
(iv) acquisition/integration costs.

EBITDAC - Adjusted for the three months ended June 30, 2022 increased 2.2%, or
$0.8 million, as compared to the same period in 2021, to $36.5 million. EBITDAC
Margin - Adjusted for the three months ended June 30, 2022 decreased to 32.5%
from 34.1%, as compared to the same period in 2021. EBITDAC Margin - Adjusted
decreased due to: (i) higher broker compensation; and (ii) increased variable
operating expenses as compared to prior year.

The Wholesale Brokerage Segment's total revenues for the six months ended June
30, 2022 increased 10.2%, or $19.9 million, as compared to the same period in
2021, to $215.3 million. The $19.0 million net increase in core commissions and
fees revenue was driven primarily by: (i) $17.6 million related to net new and
renewal business; and (ii) $1.4 million related to core commissions and fees
revenue from acquisitions that had no comparable revenues in the same period of
2021. Profit-sharing contingent commissions for the first six months of 2022
increased approximately $0.9 million compared to the same period of 2021. The
Wholesale Brokerage Segment's growth rate for total commissions and fees was
9.9%, and the Organic Revenue growth rate was 9.2% for the first six months of
2022. The Organic Revenue growth rate was driven by new business, good retention
as well as rate increases for most lines of coverage with the Organic Revenue
growth impacted by declines in our personal lines business caused by reduced
carrier appetite to write coverage in certain geographies or lines of business.

Income before income taxes for the six months ended June 30, 2022 increased
31.9%, or $14.4 million, as compared to the same period in 2021, to $59.5
million. The increase was due to: (i) decrease in the change in estimated
acquisition earn-out payables; (ii) lower intercompany interest expense; and
(iii) the drivers of EBITDAC - Adjusted described below; partially offset by
(iv) acquisition/integration costs.

EBITDAC - Adjusted for the six months ended June 30, 2022 increased 11.7%, or
$7.2 million, as compared to the same period in 2021, to $69.0 million. EBITDAC
Margin - Adjusted for the six months ended June 30, 2022 increased to 32.0% from
31.6% in the same period in 2021. EBITDAC Margin - Adjusted increased due to:
(i) higher profit-sharing contingent commissions; and (ii) leveraging our
expense base in connection with revenue growth; partially offset by (iii) higher
broker compensation; and (iv) increased variable operating expenses, which are
primarily travel and meeting related.

Service sector

The Services Segment provides insurance-related services, including third-party
claims administration and comprehensive medical utilization management services
in both the workers' compensation and all-lines liability arenas. The Services
Segment also provides Medicare Set-aside account services, Social Security
disability and Medicare benefits advocacy services, and claims adjusting
services.

Unlike the other segments, almost all of the Services segment’s revenue is
generated by fees, which are not significantly affected by fluctuations
general insurance premiums.

                                       43
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Financial information relating to our Services Segment for the three and six
months ended June 30, 2022 and 2021 is as follows:

                                        Three months ended June 30,                   Six months ended June 30,
(in millions, except
percentages)                        2022             2021        % Change         2022          2021        % Change
REVENUES
Core commissions and fees         $    44.0        $   44.9           (2.0 %)   $    87.6      $  91.9           (4.7 %)
Profit-sharing contingent
commissions                               -               -              - %            -            -              - %
Investment income                         -               -              - %            -            -              - %
Other income, net                         -               -              - %            -            -              - %
Total revenues                         44.0            44.9           (2.0 %)        87.6         91.9           (4.7 %)
EXPENSES
Employee compensation and
benefits                               22.1            22.2           (0.5 )%        44.7         45.0           (0.7 %)
Other operating expenses               13.1            12.6            4.0 %         25.2         25.1            0.4 %
(Gain)/loss on disposal                   -               -              - %            -            -              - %
Amortization                            1.3             1.3              - %          2.6          2.7           (3.7 )%
Depreciation                            0.4             0.4              - %          0.8          0.7           14.3 %
Interest                                0.5             0.7          (28.6 )%         1.1          1.5          (26.7 )%
Change in estimated acquisition
earn-out payables                         -               -              - %            -            -              - %
Total expenses                         37.4            37.2            0.5 %         74.4         75.0           (0.8 %)
Income before income taxes        $     6.6        $    7.7          (14.3 %)   $    13.2      $  16.9          (21.9 %)
Income Before Income Taxes
Margin (1)                             15.0 %          17.1 %                        15.1 %       18.4 %
EBITDAC - Adjusted (2)            $     8.8        $   10.1          (12.9 %)   $    17.7      $  21.8          (18.8 %)
EBITDAC Margin - Adjusted (2)          20.0 %          22.5 %                        20.2 %       23.7 %
Organic Revenue growth rate (2)        (0.5 %)          4.7 %                        (3.4 %)       5.1 %
Employee compensation and
benefits relative to total
  revenues                             50.2 %          49.4 %                        51.0 %       49.0 %
Other operating expenses
relative to total revenues             29.8 %          28.1 %                        28.8 %       27.3 %
Capital expenditures              $     0.3        $    0.4          (25.0 )%   $     0.5      $   0.5              - %
Total assets at June 30,                                                        $   287.9      $ 447.3          (35.6 )%




(1) "Income Before Income Taxes Margin" is defined as income before income taxes
divided by total revenues.
(2) A non-GAAP financial measure.
NMF = Not a meaningful figure

The Services Segment's total revenues for the three months ended June 30, 2022
decreased 2.0%, or $0.9 million, as compared to the same period in 2021, to
$44.0 million. The Services Segment's total commissions and fees and Organic
Revenue declined 0.5% for the second quarter of 2022 driven by: (i) higher
COVID-19 travel restricted claims in the prior year; and (ii) a lack of
weather-related claims coupled with reduced severity in the current year.

Income before income taxes for the three months ended June 30, 2022 decreased
14.3%, or $1.1 million, as compared to the same period in 2021, to $6.6 million.
Income before income taxes decreased due to the drivers of EBITDAC - Adjusted
described below.

EBITDAC - Adjusted for the three months ended June 30, 2022 decreased 12.9%, or
$1.3 million, from the same period in 2021, to $8.8 million. EBITDAC Margin -
Adjusted for the three months ended June 30, 2022 decreased to 20.0% from 22.5%
in the same period in 2021. The decrease in EBITDAC and EBITDAC Margin was
driven primarily by the reduction in revenue.

The Services Segment's total revenues for the six months ended June 30, 2022
decreased 4.7%, or $4.3 million from the same period in 2021, to $87.6 million.
The Services Segment's total commissions and fees and Organic Revenue growth
declined 3.4% for the first six months of 2022. The decrease in Organic Revenue
was caused primarily by: (i) higher COVID-19 travel restricted claims in the
prior year; and (ii) a lack of weather-related claims coupled with reduced
severity in the current year.

Income before income taxes for the six months ended June 30, 2022 decreased $3.7
million, or 21.9%, from the same period in 2021, to $13.2 million. Income before
income taxes decreased due to the drivers of EBITDAC described below.

EBITDAC - Adjusted for the six months ended June 30, 2022 decreased 18.8%, or
$4.1 million, from the same period in 2021, to $17.7 million. EBITDAC Margin -
Adjusted for the six months ended June 30, 2022 decreased to 20.2% from 23.7% in
the same period in 2021. The decrease in EBITDAC and EBITDAC Margin were driven
primarily by the decrease in revenue.

                                       44
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Other

As discussed in Note 12 of the Notes to Condensed Consolidated Financial
Statements, the "Other" column in the Segment Information table includes any
revenue and expenses not allocated to reportable segments, and corporate-related
items, including the intercompany interest expense charges to reporting
segments.

CASH AND CAPITAL RESOURCES

The Company seeks to maintain a conservative balance sheet and strong liquidity
profile. Our capital requirements to operate as an insurance intermediary are
low and we have been able to grow and invest in our business principally through
cash that has been generated from operations. We have the ability to utilize our
Revolving Credit Facility, which as of June 30, 2022 provided up to $550.0
million in available cash. We believe that we have access to additional funds,
if needed, through the capital markets or private placements to obtain further
debt financing under the current market conditions. The Company believes that
its existing cash, cash equivalents, short-term investment portfolio and funds
generated from operations, together with the funds available under the Revolving
Credit Facility, will be sufficient to satisfy our normal liquidity needs,
including principal payments on our long-term debt, for at least the next 12
months.

The Revolving Credit Facility contains an expansion option for up to an
additional $500.0 million of borrowing capacity, subject to the approval of
participating lenders. In addition, under the Term Loan Credit Agreement, the
unsecured term loan in the initial amount of $300.0 million may be increased by
up to $150.0 million, subject to the approval of participating lenders. On March
31, 2022, the Company entered into a Loan Agreement (the "Loan Agreement") which
provided term loan capacity of $800.0 million. Additionally, the Company may,
subject to satisfaction of certain conditions, including receipt of additional
term loan commitments by new or existing lenders, increase either Term Loan
Commitment under the existing Loan Agreement or the term loans issued thereunder
or issue new tranches of term loans in an aggregate additional amount of up to
$400.0 million. Including the expansion options under all existing credit
agreements, the Company has access to up to $1.6 billion of incremental
borrowing capacity as of June 30, 2022.

As of June 30, 2022, included in the Company's cash balance is £1,544.7 million,
which had a value of $1,876.4 million, on its Condensed Consolidated Balance
Sheet held in anticipation to use as cash consideration to complete the
acquisition of GRP which occurred on July 1, 2022.

Cash contractual obligations

From June 30, 2022our contractual cash obligations were as follows:

                                                            Payments Due by Period
(in millions)                                        Less than         1-3           4-5          After
                                        Total         1 year          years         years        5 years
Long-term debt                        $ 4,259.4     $      67.5     $ 1,123.1     $   818.8     $ 2,250.0
Other liabilities (1)                     162.3            25.8          20.8          12.0         103.7
Operating leases (2)                      258.7            48.9          89.1          58.5          62.2
Interest obligations                    1,573.5           151.6         270.7         210.2         941.0
Unrecognized tax benefits                   1.6               -           1.6             -             -
Maximum future acquisition
contingency payments (3)                  447.2           127.8         319.4             -             -
Total contractual cash obligations
(4)                                   $ 6,702.7     $     421.6     $ 1,824.7     $ 1,099.5     $ 3,356.9


(1)

Includes the current portion of other long-term liabilities and approximately
$15.6 million deferred employer social charges related to the
CARES Act which should be paid in December 2022.

(2)

Understand $10.6 million future lease commitments that are expected to begin later in the year
2022 and 2023.

(3)

Understand $232.9 million current and non-current estimated acquisition cost
price supplements to be paid. Additional payable for acquisitions not denominated in WE
dollars are measured at the current exchange rate.

(4)

Does not include approx. $29.0 million current liabilities for a dividend
of $0.1025 per share approved by the Board of Directors on July 20, 2022.

                                       45
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Debt

Total debt at June 30, 2022 was $4,223.8 million net of unamortized discount and
debt issuance costs, which was an increase of $2,200.9 million compared to
December 31, 2021. The increase includes: (i) the issuance of $1,200.0 million
in aggregate principal amount of Senior Notes on March 17, 2022, exclusive of
debt issuance costs and discounts applied to the principal; (ii) the drawdown of
$350.0 million of the revolving credit facility in conjunction with the
acquisition payment for Orchid on March 31, 2022; (iii) the aggregate drawdown
of $800.0 million under the Loan Agreement in connection with the preparation of
closing our pending acquisitions of GRP and BdB which occurred on various dates
on or before the final draw on April 28, 2022; and (iv) net of the amortization
of discounted debt related to our various unsecured Senior Notes, and debt
issuance cost amortization of $1.8 million; offset by decreases due to: (i) the
scheduled principal amortization balances related to our various existing
floating rate debt term notes in total of $27.5 million; and (ii) added
discounted debt balances related to the issuance of $600.0 million in aggregate
principal amount of the Company's 4.200% Senior Notes due 2032 (the "2032
Notes") and $600.0 million in aggregate principal amount of the Company's 4.950%
Senior Notes due 2052 (the "2052 Notes," and together with the 2032 Notes, the
"Notes") of $10.4 million; and (iii) debt issuance costs related to the Notes
and the Loan Agreement of $13.0 million; and (iv) on June 30, 2022 the Company
repaid $100.0 million of debt related to the outstanding amount drawn under the
revolving credit facility under the Second Amended and Restated Credit
Agreement.

During the six months ended June 30, 2022, the Company repaid $6.2 million of
principal related to the Second Amended and Restated Credit Agreement term loan
through the quarterly scheduled amortized principal payments. The Second Amended
and Restated Credit Agreement term loan had an outstanding balance of $240.6
million as of June 30, 2022. The Company's next scheduled amortized principal
payment is due September 30, 2022 and is equal to $3.1 million.

During the six months ended June 30, 2022, the Company repaid $15.0 million of
principal related to the Term Loan Credit Agreement through quarterly scheduled
amortized principal payments. The Term Loan Credit Agreement had an outstanding
balance of $225.0 million as of June 30, 2022. The Company's next scheduled
amortized principal payment is due September 30, 2022 and is equal to $7.5
million.

During the six months ended June 30, 2022, the Company repaid $6.3 million of
principal related to the Term Loans issued under the Term A-2 Loan Commitment
("Term A-2 Loans") through quarterly scheduled amortized principal payments. The
Term A-2 Loans had an outstanding balance of $493.8 million as of June 30, 2022.
The Company's next scheduled amortized principal payment is due September 30,
2022 and is equal to $6.3 million.

On March 17, 2022, the Company completed the issuance of $600.0 million
aggregate principal amount of the Company's 4.200% Senior Notes due 2032 and
$600.0 million aggregate principal amount of the Company's 4.950% Senior Notes
due 2052 (and together with the 2032 Notes, the "Notes"). The net proceeds to
the Company from the issuance of the Notes, after deducting underwriting
discounts and estimated offering expenses, were approximately $1,178.2 million.
The Senior Notes were given investment grade ratings of BBB- stable outlook and
Baa3 stable outlook. The 2032 Notes bear interest at the rate of 4.200% per year
and will mature on March 17, 2032. The 2052 Notes bear interest at the rate of
4.950% per year and will mature on March 17, 2052. Interest on the Notes will be
payable semi-annually in arrears. The Notes are senior unsecured obligations of
the Company and will rank equal in right of payment to all of the Company's
existing and future senior unsecured indebtedness. The Company may redeem the
Notes in whole or in part at any time and from time to time, at the "make whole"
redemption prices specified in the Prospectus Supplement for the Notes being
redeemed, plus accrued and unpaid interest thereon to but excluding the
redemption date. The Company used the net proceeds from the offering of the
Notes, together with borrowings under its revolving credit facility, cash on
hand and other borrowings, to fund the cash consideration and other amounts
payable under the GRP Acquisition Agreement and to pay fees and expenses
associated with the foregoing. As of June 30, 2022, there was a total
outstanding debt balance of $1,200.0 million exclusive of the associated
discount balance on both Notes.

On March 31, 2022, the Company entered into the Loan Agreement with the lenders
named therein, BMO Harris Bank N.A., as administrative agent, Fifth Third Bank,
National Association, PNC Bank, National Association, U.S. Bank National
Association and Wells Fargo Bank, National Association, as co-syndication agents
and BMO Capital Markets Corp., BofA Securities, Inc., JPMorgan Chase Bank, N.A.
and Truist Securities, Inc., as joint bookrunners and joint lead arrangers. The
Loan Agreement evidences commitments for (i) unsecured delayed draw term loans
in an aggregate amount of up to $300.0 million (the "Term A-1 Loan Commitment")
and (ii) unsecured delayed draw term loans in an amount of up to $500.0 million
(the "Term A-2 Commitment" and, together with the Term A-1 Loan Commitments, the
"Term Loan Commitments"). The Company may, subject to satisfaction of certain
conditions, including receipt of additional term loan commitments by new or
existing lenders, increase either Term Loan Commitment or the term loans issued
thereunder or issue new tranches of term loans in an aggregate additional amount
of up to $400.0 million. The Company may borrow term loans (the "Term Loans")
under either of the Term Loan Commitments during the period from the Effective
Date (the "Effective Date") until the date which is the first anniversary
thereof. Once borrowed, Term Loans issued under the Term A-1 Loan Commitment
("Term A-1 Loans") are due and payable on the date that is the third anniversary
of the Effective Date unless such maturity date is extended as provided under
the Loan Agreement. Once borrowed, Term Loans issued under the Term A-2 Loan
Commitment ("Term A-2 Loans") are repayable in installments until the fifth
anniversary the Effective Date with any remaining outstanding amounts due and
payable on such fifth anniversary of the Effective Date unless such maturity
date is extended as provided under the Loan Agreement. While outstanding, the
undrawn Term Loan Commitments accrue a commitment fee of 0.15% beginning on the
earlier of the initial funding of Term Loans under the Loan Agreement and the
date that is 120 days from the Effective Date. Once drawn, Term A-1 Loans will
bear interest at the annual rate of Adjusted Term SOFR plus 1.125% or Base Rate
plus 0.125% (subject to a pricing grid for changes in the Company's credit
rating and/or leverage) and Term A-2 Loans will bear interest at the annual rate
of Adjusted

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SOFR term increased by 1.25% or Base rate increased by 0.25% (subject to a tariff schedule for
changes in the Company’s credit rating and/or indebtedness). The loan contract
includes various covenants (including financial covenants), limitations and
typical fault events for similar installations for
borrowers. From June 30, 2022 the outstanding balance of the loan agreement was
$793.8 million.

On March 31, 2022 the Company accessed $350.0 million of available proceeds on
the revolving credit facility under the Second Amended and Restated Credit
Agreement. The proceeds were used in conjunction with the funding of the Orchid
acquisition along with funds from cash on hand. As of June 30, 2022 the
outstanding loan balance was $250.0 million.

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