Item 1A. Risk Factors

Risks Related to Our Business

Economic and External Risks

The ultimate scale and scope of the recent coronavirus (COVID-19) outbreak and resulting pandemic is unknown and is expected to continue to adversely impact our business for an extended period. The overall impact on our business, operating results, cash flows and/or financial condition has been material and we anticipate it will continue to be material.

The COVID-19 pandemic has disrupted and is expected to continue to disrupt our business, and has materially affected and is anticipated to continue to materially affect our operating results, cash flows and/or financial condition for an extended period of time. The ultimate scale and scope of the COVID-19 pandemic has and may continue to heighten the potential adverse effects on our business (including our equity method investments), operating results, cash flows and/or financial condition described in certain of the other risk factors contained in this Annual Report on Form 10-K. In addition, the COVID-19 pandemic has, in some cases, adversely impacted our business and financial condition in specific ways, and we expect it to continue to do so, including its impact on:

•overall economic conditions, which have and will likely continue to be adversely impacted by the COVID-19 pandemic and related global shutdowns;

•our ability to maintain sufficient qualified personnel due to employee illness, quarantine, willingness to return to work or social-distancing, travel or other restrictions;

•the financial health of our clients and consumers and their demand and ability to pay for certain of our services;

•small and medium sized businesses within our Uniform segment and their ability to remain in business or return to operations;

•our ability to obtain new business, expand or otherwise execute on strategic plans;

•our ability to restart operations in an effective manner after COVID-19 related shutdowns;

•additional costs related to cleaning and other protocols to provide safe working conditions for our employees, clients and consumers;

•our ability to comply with new legal or regulatory requirements enacted in connection with the COVID-19 pandemic in a cost-effective manner;

•legal actions or proceedings related to COVID-19;

•our ability to continue to effect certain cost savings initiatives and achieve synergies from acquisitions;

•partial or full closure of client premises for unknown periods of time resulting in non-provision of services to the client, reduced or no revenue generation in those units and further headcount reductions;

•our major league sports clients operating with significantly fewer or no spectators;

•postponement of large events leading to postponement of revenue and a decrease in our margin;

•the willingness of end consumers to go to the facilities where we operate during the pandemic or for some period thereafter;

•our ability to maintain a safe and cost-effective supply chain as COVID-19 may continue to adversely affect our suppliers;

•ability to service our indebtedness; and

•our impairment analysis and future impairment charges, including the effect of changing assumptions or estimates in the fair value calculations or variation from expectations of future cash flows or growth rates, including those assumptions relating to the duration and severity of COVID-19.

The duration and extent of the impact from the COVID-19 pandemic depends on future developments that cannot be accurately predicted at this time, such as the severity and transmission rate of the virus, the extent and effectiveness of governmental responses and other preventative, treatment and containment actions or developments, including the distribution of any potential vaccine, shifts in behavior going forward, and the impact of these and other factors on our employees, clients, customers, suppliers and partners. For example, in our Sports, Leisure & Corrections sector and certain aspects of our Education sector, there is particular uncertainty around future operations given social distancing guidelines or the prospect of attendance or enrollment levels not returning to previous levels that may adversely impact our business model going forward. In addition, even after the COVID-19 pandemic subsides, the increase in and acceptance of remote working may continue to

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adversely impact our revenues and business model in our business dining operations. There is the risk that certain mitigation and cost-saving initiatives to date may not be sustainable or repeatable, including our ability to furlough additional employees for an indefinite duration, to further reduce our cost structure or renegotiate client contracts, or that the prolonged effects of COVID-19 may be different than what we have experienced thus far, including permanent closures of client facilities. Further, while we have benefited from government assistance programs, including the CARES Act, to date, there is no assurance that such programs will continue indefinitely. We anticipate that the impacts of COVID-19 on our overall business environment, operating results, cash flows and/or financial condition will continue to be material for an unknown duration.

Unfavorable economic conditions have in the past, are currently and in the future could, adversely affect our results of operations and financial condition.

In the past, national and international economic downturns have reduced demand for our services and any such downturns are currently, and in the future could continue to reduce demand for our services in each of our reportable segments, resulting in the loss of business or increased pressure to contract for business on less favorable terms than our generally preferred terms. Economic hardship ~~among~~in our client base ~~can~~has also impacted and may continue to impact our business. For example, during the current COVID-19 pandemic, or in the past, such as in the period of economic distress following the financial crisis of 2008, certain of our businesses are being or were negatively affected by reduced employment levels at our clients’ locations and declining levels of business and consumer spending. In addition, financial distress and insolvency experienced by clients, especially larger clients, ~~has~~ in the past ~~made it difficult,~~has, currently does, and in the future could make it difficult for us to collect amounts we are owed and could result in the voiding or modification of existing contracts. For example, in response to the changed circumstances caused by the current COVID-19 pandemic, we have worked with clients to renegotiate contracts and financial structures in order to mitigate lost revenues caused by partial or full closure of client premises. Similarly, financial distress or insolvency, if experienced by our key vendors and service providers such as insurance carriers, could significantly increase our costs.

The portion of our food and support services business that provides services in public facilities such as convention centers and tourist and recreational attractions is particularly sensitive to an economic downturn, as expenditures to take vacations or hold or attend conventions are funded to a partial or total extent by discretionary income. A decrease in such discretionary income on the part of potential attendees at our clients' facilities has in the past resulted, and in the future could result, in a reduction in our revenue. Further, because our exposure to the ultimate consumer of what we provide is limited by our dependence on our clients to attract those consumers to their facilities and events, our ability to respond to such a reduction in attendance, and therefore our revenue, is limited. For example, partial or full closure of client facilities due to COVID-19 or operation of such facilities including sports stadiums with significantly fewer or no attendees has led and will likely continue to lead to reduced revenues. There are many factors that could reduce the numbers of events in a facility or attendance at an event, including the continuing COVID-19 pandemic, labor disruptions involving sports leagues, poor performance by the teams playing in a facility, number of playoff games, inclement weather and adverse economic conditions which would adversely affect revenue and profits.

Natural disasters, global calamities, political unrest, sports strikes and other adverse incidents could adversely affect our revenue and operating results.

Natural disasters, including hurricanes and earthquakes, global calamities, such as an Ebola outbreak or ~~a flu~~the current COVID-19 pandemic, or political unrest, such as the recent demonstrations in Chile, have, and in the future could, affect our revenue and operating results. As noted, our revenue and operating results have been and will likely continue to be materially impacted by the COVID-19 pandemic. In the past, due to more geographically isolated natural disasters, such as wildfires in the western United States and hurricanes in the southern United States, we experienced lost and closed client locations, business disruptions and delays, the loss of inventory and other assets, asset impairments and the effect of the temporary conversion of a number of our client locations to provide food and shelter to those left homeless by storms. ~~For example, our financial results were particularly impacted in 2018 by wildfires in~~The frequency and ~~around Yosemite National Park and in 2017 by Hurricane Maria in Puerto Rico and Hurricane Harvey and Hurricane Irma in~~severity of such natural disasters may increase due to the ~~southern United States.~~effects of global climate change. In addition, any terrorist attacks, particularly against venues that we serve, and the national and global military, diplomatic and financial response to such attacks or other threats, also may adversely affect our revenue and operating results. Sports strikes, particularly those that persist for an extended time period, can reduce our revenue and have an adverse impact on our results of operations. Any decrease in the number of games played, or the occurrence of games with limited or no fans attending, has resulted and would ~~mean~~in the future result in a loss of revenue and reduced profits at the venues we service.

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Operational Risks

Our failure to retain our current clients, renew our existing client contracts on comparable terms and obtain new client contracts could adversely affect our business.

Our success depends on our ability to retain our current clients, renew our existing client contracts and obtain new business on commercially-favorable terms. Our ability to do so generally depends on a variety of factors, including the quality, price and responsiveness of our services, as well as our ability to market these services effectively and differentiate ourselves from our competitors. ~~The renewal of business~~When we renew existing client contracts, it is often ~~results in a decrease in~~on terms that are less favorable or less profitable for us than the ~~profitability of such business.~~initial contract terms. There can be no assurance that we will be able to obtain new business, renew existing client contracts at the same or higher levels of pricing or that our current clients will not turn to competitors, cease operations, elect to self-operate or terminate contracts with us. These risks may be exacerbated by the current COVID-19 pandemic due to, among other things, increased cost pressure at our clients and heightened competition in a contracted marketplace. In addition, consolidation by our clients in the industries we serve could result in our losing business if the combined entity chooses a different provider. The failure to renew a significant number of our existing contracts, including on the same or more favorable terms, would have a material adverse effect on our business and results of operations and the failure to obtain new business could have an adverse impact on our growth and financial results.

We may be adversely affected if clients reduce their outsourcing or use of preferred vendors.

Our business and growth strategies depend in large part on the continuation of a current trend toward outsourcing services. Clients will outsource if they perceive that outsourcing may provide quality services at a lower overall cost and permit them to focus on their core business activities. We cannot be certain ~~that~~ this trend will continue or not be reversed or that clients that have outsourced functions will not decide to perform these functions themselves.

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In addition, labor unions representing employees of some of our current and prospective clients have occasionally opposed the outsourcing trend ~~to the extent that~~as they believed that current union jobs for their memberships might be lost. In these cases, unions typically seek to prevent public sector entities from outsourcing and if that fails, ensure that jobs that are outsourced continue to be unionized, which can reduce our pricing and operational flexibility with respect to such businesses.

We have also identified a trend among some of our clients ~~toward~~towards the retention of a limited number of preferred vendors to provide all or a large part of their required services. We cannot be certain ~~that~~ this trend will continue or not be reversed or, if it does continue, that we will be selected and retained as a preferred vendor to provide these services. Unfavorable developments with respect to either outsourcing or the use of preferred vendors could have a material adverse effect on our business and results of operations.

Competition in our industries could adversely affect our results of operations.

There is significant competition in the food and support services business from local, regional, national and international companies, of varying sizes, many of which have substantial financial resources. Our ability to successfully compete depends on our ability to provide quality services at a reasonable price and to provide value to our clients and consumers. Certain of our competitors have been and may in the future be willing to underbid us or accept a lower profit margin or expend more capital in order to obtain or retain business. Also, certain regional and local service providers may be better established than we are within a specific geographic region. In addition, existing or potential clients may elect to self-operate their food and support services, eliminating the opportunity for us to serve them or compete for the account. We may also ~~may~~ face increased competition from offsite food delivery at our clients as online restaurant aggregators and similar businesses, ~~and~~as well as other providers with potentially disruptive business models have been successful at applying technology developments to local food service. While we have a significant international presence, certain of our competitors have more extensive portfolios of services and a broader geographic footprint than we do. Therefore, we may be placed at a competitive disadvantage for clients who require multiservice or multinational bids.

We have a number of major national competitors in the uniform rental industry with significant financial resources. In addition, there are regional and local uniform suppliers whom we believe have strong client loyalty. While most clients focus primarily on quality of service, uniform rental is also is a price-sensitive service and if existing or future competitors seek to gain clients or accounts by reducing prices, we may be required to lower prices, which would reduce our revenue and profits. The uniform rental business requires investment capital for growth. Failure to maintain capital investment in this business would put us at a competitive disadvantage. In addition, ~~due~~ to ~~competition in our uniform rental business,~~maintain a cost structure that allows for competitive pricing it ~~has become increasingly~~is important for us to source garments and other products ~~overseas, particularly~~internationally, including from ~~China.~~China and Mexico. To the extent we are not able to effectively source such products ~~from China~~internationally and gain the related cost savings, we may be at a ~~further~~ disadvantage in relation to some of our competitors.

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Increased operating costs and obstacles to cost recovery due to the pricing and cancellation terms of our food and support services contracts may constrain our ability to make a profit.

Our profitability can be adversely affected to the extent we are faced with cost increases for food, wages, other labor related expenses (including workers' compensation, state unemployment insurance and federal or state mandated health benefits and other healthcare costs), insurance, fuel, utilities, piece goods, clothing and equipment, especially to the extent we are unable to recover such increased costs through increases in ~~the~~ prices for our products and services, due to ~~one or more of~~ general economic conditions, competitive conditions or contractual provisions in our client contracts. For example, when federal, state, foreign or local minimum wage rates increase, we may have to increase the wages of both minimum wage employees and employees whose wages are above the minimum wage. We may also face increased operating costs resulting from changes in federal, state or local laws and regulations relating to employment matters, including those relating to the classification of employees, employee eligibility for overtime and secure scheduling requirements, which often incorporate a premium pay mandate for scheduling deviations. Oil and natural gas prices have fluctuated significantly in the last several years. Substantial increases in the cost of fuel and utilities have historically resulted in substantial cost increases in our uniform rental business, and to a lesser extent in our food and support services segments. In addition, United States and foreign trade policies, tariffs and other impositions on imported goods, trade sanctions imposed on certain countries, the limitation on the importation of certain types of goods or of goods containing certain materials from other countries could increase costs in our uniform rental business. From time to time we have experienced increases in our food costs. Food prices can fluctuate as a result of permanent or temporary changes in supply, including as a result of incidences of severe weather such as droughts, heavy rains and late freezes or more prolonged climate change, natural ~~disasters.~~disasters or pandemics, or to the extent we are unable to negotiate favorable terms on volume discounts, rebates or other applicable credits with our suppliers. Increasing client and consumer demands relating to sustainability also can result in increased costs for our food and support services segment. We have two main types of contracts in our food and facilities business: profit and loss contracts in which we bear all of the expenses of the contract but gain the benefit of the revenue, and client interest contracts in which our clients share some or all of the expenses and gain some or all of the revenue. Approximately two-thirds of our food and support services revenue in fiscal ~~2019~~2020 is from profit and loss contracts under which we have limited ability to

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pass on cost increases to our clients. Therefore, absent our ability to negotiate contractual changes, including pricing, we may have to absorb cost increases, which may adversely impact our operating results.

The amount of risk that we bear and our profit potential vary depending on the type of contract under which we provide food and support services. We may be unable to fully recover costs on contracts that limit our ability to increase prices. In addition, we provide many of our services under contracts of indefinite term, which are subject to termination on short notice by either party without cause. Some of our profit and loss and client interest contracts contain minimum guaranteed remittances to our client regardless of our revenue or profit at the facility, typically contingent on certain future events. If revenue does not exceed costs under a contract that contains minimum guaranteed payments, we will bear any losses which are incurred, as well as the guaranteed payment. Generally, our contracts also limit our ability to raise prices on the food, beverages and merchandise we sell within a particular facility without the client's consent. In addition, some of our contracts exclude certain events or products from the scope of the contract, or give the client the right to modify the terms under which we may operate at certain events. Guaranteed payments or other guaranteed amounts to a client under a profit and loss contract that is not profitable, the refusal by individual clients to permit the sale of some products at their venues, the imposition by clients of limits on prices which are not economically feasible for us, or decisions by clients to curtail their use of the services we provide could adversely affect our revenue and results of operations. During the current COVID-19 pandemic, we have renegotiated client contracts, particularly profit and loss contracts, to modify certain financial terms and increase profitability, which has partially offset losses due to client closures and reduced utilization of services. To the extent the impacts of COVID-19 continue for an extended period of time beyond the term of any such modifications, we may not be able to continue to renegotiate or modify contracts, which could more materially impact our profitability going forward.

Our international business faces risks that differ from those we face in the United States that could have an effect on our results of operations and financial condition.

A significant portion of our revenue is derived from international business. During fiscal 2020, approximately 23% of our revenue was generated outside of the United States. We currently have a presence in 18 countries outside of the United States with approximately 108,300 personnel. We also provide our services on a more limited basis in several additional countries. Our international operations are subject to risks that are different from those we face in the United States, including the requirement to comply with changing, conflicting and unclear national and local regulatory requirements; compliance with the Foreign Corrupt Practices Act, U.K. Bribery Act and other anti-corruption law compliance matters, as well as cybersecurity and data protection laws; potential difficulties in staffing and labor disputes; differing local labor laws; managing and obtaining support and distribution for local operations; credit risk or financial condition of local clients; potential imposition of restrictions on investments; potentially adverse tax consequences, including imposition or increase of withholding, VAT and other taxes on remittances and other payments by subsidiaries; foreign exchange controls; local political and social conditions;

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geopolitical tensions, including, for example, tensions between the U.S. and China; and the ability to comply with terms of government assistance programs, including those addressing COVID-19 impact. For example, ~~during~~in June 2016, the ~~most recent economic downturn, certain~~United Kingdom voted to leave the European Union ("Brexit"). Aramark has operated in the United Kingdom since 1972 and employs approximately 9,250 employees there today. While our operations in the United Kingdom do not represent a significant portion of our ~~business & industry clients curtailed their employees' use of catering, which had~~revenue, the United Kingdom's departure from the European Union could have a negative effect on our ~~revenue~~business there if Brexit results in a slowdown of the local economy or employment environment. As a country, the United Kingdom imports half of its food supply, and ~~profits.~~any change in tariffs, customs or tax would impact our supply chain. In addition, the operating results of our non-U.S. subsidiaries are translated into U.S. dollars and those results are affected by movements in foreign currencies relative to the U.S. dollar.

~~Our inability~~In addition, local labor and employment laws in countries outside of the United States can make it more difficult and costly to ~~achieve cost savings through~~reduce labor costs in connection with decreases in demand for our ~~cost reduction efforts~~services.Recently, in certain countries we were unable to reduce our international labor costs to reflect the adverse impact of the COVID-19 pandemic to the same extent as we were able to in the United States and therefore the decrease in our international operating income as a percentage of the decrease in our revenues was higher than in our U.S. business and we expect to experience similar difficulties in reducing operating expenses in the future.

We will continue to explore and consider opportunities to develop our business in emerging countries over the long term. Emerging international operations present several additional risks, including greater fluctuation in currencies relative to the U.S. dollar; economic and governmental instability; civil disturbances; volatility in gross domestic production; and nationalization and expropriation of private assets.

There can be no assurance that the foregoing factors will not have a material adverse effect on our international operations or on our consolidated financial condition and results of operations.

Risks associated with the suppliers from whom our products are sourced could ~~impact~~adversely affect our results of operations.

The ~~achievement~~raw materials we use in our business and the finished products we sell are sourced from a wide variety of domestic and international suppliers. We seek to require our suppliers to comply with applicable laws and otherwise be certified as meeting our supplier standards of conduct. Our ability to find qualified suppliers who meet our standards, including with respect to requirements around sustainably-sourced food and other products, and to access raw materials and finished products in a timely and efficient manner is a challenge, especially with respect to suppliers located and goods sourced outside the United States and other countries in which we operate. Insolvency experienced by suppliers could make it difficult for us to source the items we need to run our business. Political and economic stability in the countries in which foreign suppliers are located, the financial stability of suppliers, suppliers' failure to meet our standards, labor problems experienced by our suppliers, the availability of raw materials to suppliers, cybersecurity issues, currency exchange rates, transport availability and cost, tariffs, inflation and other factors relating to the suppliers and the countries in which they are located are beyond our control. Domestic foreign trade policies, tariffs and other impositions on imported goods, trade sanctions imposed on certain countries, the limitation on the importation of certain types of goods or of goods containing certain materials from other countries and other factors relating to foreign trade are beyond our control. If one of our suppliers were to violate the law, or engage in conduct that results in adverse publicity, our reputation may be harmed simply due to our association with that supplier. These and other factors affecting our suppliers and our access to raw materials and finished products could adversely affect our results of operations.

We rely on large food service distribution companies to distribute our food and non-food products and a disruption in our relationship with them or their business could result in short-term disruptions to our operations and cost structure.

Although we negotiate the pricing and other terms for the majority of our purchases of food and related products in the U.S. and Canada directly with national manufacturers, we purchase these products and other items through national distributors and suppliers, including Sysco Corporation, US Foods, Performance Food Group and regional distributors. Sysco, which distributed approximately 47%of our food and non-food products in the United States and Canada in fiscal 2020 based on purchase dollars, and other distributors are responsible for tracking our orders and delivering products to our specific locations. If our relationship with, or the business of, Sysco or another primary distributor were to be disrupted, we would have to arrange alternative distributors and our operations and cost structure could be adversely affected in the short term. Similarly, a sudden termination of the ~~goals we set~~relationship with a significant provider in ~~our plans and our future financial performance is dependent,~~other geographic areas could in part, on our efforts to reduce our cost structure through various cost reduction initiatives. Successful execution of our cost reduction initiatives is not assured and there are several obstacles to success, includingthe short term adversely affect our ability to ~~enable~~provide services and disrupt our client relationships in such areas.

Our business is contract intensive and may lead to client disputes.

Our business is contract intensive and we are parties to many contracts with clients all over the ~~information technology~~world. Our client interest contracts provide that client billings, and ~~business processes required~~ for some contracts the sharing of profits and losses, are based on our determinations of costs of service. Contract terms under which we base these ~~efforts. In addition, there can~~determinations and, for certain government contracts, regulations governing our cost determinations, may be ~~no assurance that our efforts, if properly executed, will~~subject to differing interpretations which could result in disputes with our ~~desired outcome~~clients

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from time to time. Clients generally have the right to audit our contracts, and we periodically review our compliance with contract terms and provisions. If clients were to dispute our contract determinations, the resolution of ~~improved financial performance.~~such disputes in a manner adverse to our interests could negatively affect revenue and operating results. While we do not believe any reviews, audits or other such matters should result in material adjustments, if a large number of our client arrangements were modified in response to any such matter, the effect could be materially adverse to our business or results of operations.

Our expansion strategy involves risks.

We may seek to acquire companies or interests in companies, or enter into joint ventures that complement our business. Our inability to complete acquisitions, integrate acquired companies successfully or enter into joint ventures may render us less competitive. At any given time, we may be evaluating one or more acquisitions or engaging in acquisition negotiations. We cannot be sure that we will be able to continue to identify acquisition candidates or joint venture partners on commercially reasonable terms or at all. If we make acquisitions, we also cannot be sure that any benefits anticipated from the acquisitions will actually be realized. Likewise, we cannot be sure ~~that~~ we will be able to obtain necessary financing for acquisitions. Such financing could be restricted by the terms of our debt agreements or it could be more expensive than our current debt. The amount of such debt financing for acquisitions could be significant and the terms of such debt instruments could be more restrictive than our current covenants. In addition, our ability to control the planning and operations of our joint ventures and other less than majority-owned affiliates may be subject to numerous restrictions imposed by the joint venture agreements and majority stockholders. Our joint venture partners may also have interests which differ from ours.

The process of integrating acquired operations into our existing operations may result in operating, contract and supply chain difficulties, such as the failure to retain existing clients or attract new clients, maintain relationships with suppliers and other contractual parties, or retain and integrate acquired personnel. In addition, cost savings that we expect to achieve, for example, from the elimination of duplicative expenses and the realization of economies of scale or synergies, may take longer than expected to realize or may ultimately be smaller than we expect. Also, in connection with any acquisition, we could fail to discover liabilities of the acquired company for which we may be responsible as a successor owner or operator in spite of any investigation we make prior to the acquisition, resulting in additional unanticipated costs. In addition, labor laws in certain countries may require us to retain more employees than would otherwise be optimal from entities we acquire. Such integration difficulties may divert significant financial, operational and managerial resources from our existing operations and make it more difficult to achieve our operating and strategic objectives, which could have a material adverse effect on our business, financial condition or results of operations. Similarly, our business depends on effective information technology and financial reporting systems. Delays in or poor execution of the integration of these systems could disrupt our operations and increase costs, and could also potentially adversely impact the effectiveness of our disclosure controls and internal controls over financial reporting.

Possible future acquisitions could also ~~could~~ result in ~~the incurrence of~~ additional contingent liabilities and amortization expenses related to intangible assets being incurred, which could have a material adverse effect on our business, financial condition or results of operations. In addition, goodwill and other intangible assets resulting from business combinations represent a significant portion of our assets. If ~~the~~ goodwill or other intangible assets were deemed to be impaired, we would need to take a charge to earnings to write down ~~the asset~~these assets to ~~its~~their fair value. For example, in connection with the Avendra and AmeriPride acquisitions, we recorded aggregate goodwill of $895.7 million.

Labor-Related Risks

Continued or further unionization of our workforce may increase our costs and work stoppages could damage our business.

Approximately 42,650 employees in our United States and Canadian operations are represented by unions and covered by collective bargaining agreements. The continued or further unionization of a significantly greater portion of our workforce could increase our overall costs at the affected locations and adversely affect our flexibility to run our business in the most efficient manner to remain competitive or acquire new business. In addition, any significant increase in the number of work stoppages at our various operations could adversely affect our business, financial condition or results of operations.

We may incur significant liability as a result of our participation in multiemployer defined benefit pension plans.

A number of our locations operate under collective bargaining agreements. Under some of these agreements, we are obligated to contribute to multiemployer defined benefit pension plans. As a contributing employer to such plans, should we trigger either a “complete” or “partial" withdrawal, or should the plan experience a "mass" withdrawal, we could be subject to withdrawal liability for our proportionate share of any unfunded vested benefits which may exist for the particular plan. In addition, if a multiemployer defined benefit pension plan fails to satisfy the minimum funding standards, we could be liable to increase our contributions to meet minimum funding standards. Also, if another participating employer withdraws from the plan or experiences financial difficulty, including bankruptcy, our obligation could increase. The financial status of a small number of the plans to which we contribute has deteriorated in the recent past and continues to deteriorate. We proactively monitor the

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financial status of these and the other multiemployer defined benefit pension plans in which we participate. In addition, any increased funding obligations for underfunded multiemployer defined benefit pension plans could have an adverse financial impact on us.

Our business may suffer if we lose key management personnel, are unable to hire and retain sufficient qualified personnel or if labor costs increase.

We ~~acquired Avendra~~believe much of our future growth and success, particularly in the midst of the COVID-19 pandemic, depends on ~~December 11, 2017~~the continued availability and ~~AmeriPride on January 19, 2018.~~service of key executive and management talent. The ~~success~~loss of ~~these acquisitions depends,~~any of our key executive or senior management personnel could harm our business. In addition, from time to time, we have had difficulty in ~~part, on~~hiring and retaining qualified management personnel, particularly at the entry management level. We will continue to have significant requirements to hire such personnel. At times when the United States or other geographic regions experience reduced levels of unemployment, there may be a shortage of qualified workers at all levels. Given that our workforce requires large numbers of entry level and skilled workers and managers, low levels of unemployment when such conditions exist or mismatches between the labor markets and our skill requirements can compromise our ability in certain areas of our businesses to ~~successfully integrate these businesses~~continue to provide quality service or compete for new business. We are also impacted by the costs and other effects of compliance with U.S. and international regulations affecting our ~~current operations~~workforce. These regulations are increasingly focused on employment issues, including wage and ~~to realize the anticipated benefits, including synergies, from the acquisitions on a timely basis. It may take longer than expected to realize these anticipated~~hour, healthcare, immigration, retirement and other employee benefits and ~~they may ultimately be smaller than~~workplace practices. Compliance and claims of non-compliance with these regulations could result in liability and expense to us. Historically, we ~~expect. There are~~have also regularly hired a large number of ~~challenges~~part-time and ~~risks involved~~seasonal workers, particularly in our ~~ability to successfully integrate Avendra~~food and ~~AmeriPride with our current businesses and to realize the anticipated benefits of these acquisitions,~~support services segments. Any difficulty we may encounter in hiring such workers, including ~~all of the risks identified~~difficulties caused by immigration policies, could result in ~~the paragraphs above. Any of these factors~~significant increases in labor costs, which could have a material adverse effect on our business, financial condition orand results of operations. ~~For example, there are a number of factors beyond our control that could affect the amount and timing of the integration expenses that we expect to incur~~Competition for labor has at times resulted in ~~connection with these acquisitions. In addition,~~wage increases in the ~~short term these integration expenses are anticipated~~past and future competition could substantially increase our labor costs. Due to ~~exceed~~ the labor intensive nature of our businesses and the fact that approximately two-thirds of our food and support services segments' revenue is from profit and loss contracts under which we have limited ability to pass along cost ~~savings that we expect to achieve from the elimination~~increases, a shortage of ~~duplicative expenses, realization~~labor or increases in wage levels in excess of ~~economies of scale and integration of the acquired businesses. During such period, these charges~~normal levels could ~~negatively impact~~have a material adverse effect on our results of operations.

~~A failure to maintain food safety throughout our supply chain~~Legal, Regulatory, Safety and ~~food-borne illness concerns may result in reputational harm and claims of illness or injury that could adversely affect us.~~

Food safety is a top priority for us and we dedicate substantial resources to ensuring that our consumers enjoy safe, quality food products. Claims of illness or injury relating to food quality, food handling or allergens are common in the food service industry, and a number of these claims may exist at any given time. Because food safety issues could be experienced at the source or by food suppliers or distributors, food safety could, in part, be out of our control. Regardless of the source or cause, any report of food-borne illness or other food safety issues such as food tampering or contamination at one of our locations could adversely impact our reputation, hindering our ability to renew contracts on favorable terms or to obtain new business, and have a negative impact on our revenue. Even instances of food-borne illness, food tampering or contamination at a location served by one of our competitors could result in negative publicity regarding the food service industry generally and could negatively impact our revenue. Future food safety issues may also from time to time disrupt our business. In addition, product recalls or health concerns associated with food contamination may also increase our raw materials costs.Security Risks

Laws and governmental regulations relating to food and beverages may subject us to significant liability.

The laws and regulations relating to each of our food and support services segments are numerous and complex. A variety of laws and regulations at various governmental levels ~~relating~~relate to the handling, preparation, transportation and serving of food (including, in some cases, requirements relating to the temperature of food). In addition, the cleanliness of food production facilities and the hygiene of food-handling personnel are enforced primarily at the local public health department level. There can be no assurance that we are in full compliance with all applicable laws and regulations at all times or that we will be able to comply with any future laws and regulations. Furthermore, legislation and regulatory attention to food safety is very high. Additional or amended laws or regulations in this area may significantly increase the cost of compliance or expose us to liabilities.

We serve alcoholic beverages at many facilities, and must comply with applicable licensing laws, as well as state and local service laws, commonly called dram shop ~~statutes.~~statutes in the U.S. Dram shop statutes generally prohibit serving alcoholic beverages to certain persons, such as an individual who is visibly intoxicated or a minor. If we violate dram shop laws, we may be liable to the patron and/or third parties for the acts of the patron. Although we sponsor regular training programs designed to minimize the likelihood of such a situation and to take advantage of certain safe harbors and affirmative defenses established for the benefit of alcoholic beverages service providers, we cannot guarantee that visibly intoxicated or minor patrons will not be served or that liability for their acts will not be imposed on us. There can be no assurance that additional laws or regulations in this area would not limit our activities in the future or significantly increase the cost of regulatory compliance. We must also obtain and comply with the terms of licenses in order to sell alcoholic beverages in the states in which we serve alcoholic beverages. Some of our contracts require us to pay liquidated damages during any period in which the liquor license for the facility is suspended as a result of our actions, and most contracts are subject to termination if the liquor license for the facility is lost as a result of our actions.

If we fail to comply with requirements imposed by applicable law or other governmental regulations, we could become subject to lawsuits, investigations and other liabilities and restrictions on our operations that could significantly and adversely affect our business.

We are subject to governmental regulation at the federal, state, international, national, provincial and local levels in many areas of our business, such as employment laws, wage and hour laws, discrimination laws, immigration laws, human health and safety laws, import and export controls and customs laws, environmental laws, false claims or whistleblower statutes, minority, women and disadvantaged business enterprise statutes, tax codes, antitrust and competition laws, consumer protection statutes,

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procurement regulations, intellectual property laws, food safety, labeling and sanitation laws, ~~governmentally~~government funded entitlement programs, ~~and~~government assistance programs, cost and accounting principles, the Foreign Corrupt Practices Act, the U.K. Bribery Act, other ~~anti-~~

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~~corruption~~anti-corruption laws, lobbying laws, motor carrier safety laws, data privacy and security laws, such as the European Union General Data Protection Regulation and California Consumer Privacy Act, and alcohol licensing and service laws. In the context of the current COVID-19 pandemic, we are subject to new, varied and ever-changing rules and regulations at the state and local level, including social distancing and other operational requirements, capacity limitations, cleaning and sanitation standards and travel restrictions, which have materially impacted our operations across client locations and business sectors. In May 2020, we introduced the EverSafe™ platform to support safe reopening in our client locations and to help implement COVID-19 related safety standards and requirements. To the extent that our safety standards or advice or tools provided to clients through EverSafe™ are determined to be inadequate, this may open us up to liability or reputational harm.

From time to time, ~~governmental~~government agencies have conducted reviews and audits of certain of our practices as part of routine ~~investigations~~inquiries of providers of services under government contracts, or otherwise. Like others in our business, we also receive requests for information from government agencies in connection with these reviews and audits. While we attempt to comply with all applicable laws and regulations, there can be no assurance that we are in full compliance with all applicable laws and regulations or interpretations of these laws and regulations at all times or that we will be able to comply with any future laws, regulations or interpretations of these laws and regulations.

If we fail to comply with applicable laws and regulations, including those referred to above, we may be subject to investigations, criminal sanctions or civil remedies, including fines, penalties, damages, reimbursement, injunctions, seizures, disgorgements or debarments from government contracts or the loss of liquor licenses or the ability to operate our motor vehicles. The cost of compliance or the consequences of non-compliance, including debarments, could have a material adverse effect on our business and results of operations. In addition, government agencies may make changes in the regulatory frameworks within which we operate that may require either the corporation as a whole or individual businesses to incur substantial increases in costs in order to comply with such laws and regulations.

Changes in, new interpretations of or changes in the enforcement of the governmental regulatory framework may affect our contracts and contract terms and may reduce our revenue or profits.

A portion of our revenue, estimated to be approximately ~~13%~~14% in fiscal ~~2019,~~2020, is derived from business with U.S. federal, state and local governments and agencies. Changes or new interpretations in, or changes in the enforcement of, the statutory or regulatory framework applicable to services provided under government contracts or bidding procedures, including an adverse change in government spending policies or appropriations, budget priorities or revenue levels, particularly by our food and support services businesses, could result in fewer new contracts or contract renewals, modifications to the methods we apply to price government contracts, or in contract terms of shorter duration than we have historically experienced. Any of these changes could result in lower revenue or profits than we have historically achieved, which could have an adverse effect on our results of operations.

Environmental regulations may subject us to significant liability and limit our ability to grow.

We are subject to various environmental protection laws and regulations, including the U.S. Federal Clean Water Act, Clean Air Act, Resource Conservation and Recovery Act, Comprehensive Environmental Response, Compensation, and Liability Act and similar federal, state and local statutes and regulations governing the use, management, and disposal of chemicals and hazardous materials. In particular, industrial laundries in our uniform rental business use certain detergents and cleaning chemicals to launder garments and other merchandise. The residues from such detergents and chemicals and residues from soiled garments and other merchandise laundered at our facilities may result in potential discharges to air and to water (through sanitary sewer systems and publicly owned treatment works) and may be contained in waste generated by our wastewater treatment systems.

Our industrial laundries are subject to certain volume and chemical air and water pollution discharge limits and monitoring, permitting and recordkeeping requirements.

We own or operate aboveground and underground storage tank systems at some locations to store petroleum products for use in our or our clients' operations, including some national parks. Certain of these storage tank systems also are subject to performance standards and periodic monitoring and recordkeeping requirements. We also may use and manage chemicals and hazardous materials in our operations from time to time. In the course of our business, we may be subject to penalties and fines and reputational harm for non-compliance with environmental protection laws and regulations and we may settle, or contribute to the settlement of, actions or claims relating to the management of underground storage tanks and the handling and disposal of chemicals or hazardous materials. We may, in the future, be required to expend material amounts to rectify the consequences of any such events.

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In addition, changes to environmental laws may subject us to additional costs or cause us to change aspects of our business. Under U.S. federal and state environmental protection laws, as an owner or operator of real estate we may be liable for the costs of removal or remediation of certain hazardous materials located on or in or migrating from our owned or leased property or our client's properties, as well as related costs of investigation and property damage, without regard to our fault, knowledge, or responsibility for the presence of such hazardous materials. There can be no assurance that locations that we own, lease or otherwise operate, either for ourselves or for our clients, or that we may acquire in the future, have been operated in compliance with environmental laws and regulations or that future uses or conditions will not result in the imposition of liability upon us under such laws or expose us to third-party actions such as tort suits. In addition, such regulations may limit our ability to identify suitable sites for new or expanded facilities. In connection with our present or past operations and the present or past

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operations of our predecessors or companies that we have acquired, hazardous substances may migrate from properties on which we operate or which were operated by our predecessors or companies we acquired to other properties. We may be subject to significant liabilities to the extent that human health is adversely affected or the value of such properties is diminished by such migration.

~~Our international business faces risks different from those~~A failure to maintain food safety throughout our supply chain and food-borne illness concerns may result in reputational harm and claims of illness or injury that could adversely affect us.

Food safety is a top priority for us and we ~~face~~dedicate substantial resources to ensuring that our consumers enjoy safe, quality food products. Claims of illness or injury relating to food quality, food handling or allergens are common in the ~~United States that~~food service industry and a number of these claims may exist at any given time. Because food safety issues could ~~have an effect on our results of operations and financial condition.~~

~~A significant portion~~be experienced at the source or by food suppliers or distributors, food safety could, in part, be out of our ~~revenue is derived from international business. During fiscal 2019, approximately 23%~~control. Regardless of the source or cause, any report of food-borne illness or other food safety issues such as food tampering or contamination at one of our ~~revenue was generated outside of the United States. We currently have a presence in 18 countries outside of the United States with approximately 118,600 personnel. We also provide~~locations could adversely impact our ~~services~~reputation, hindering our ability to renew contracts on ~~a more limited basis in several additional countries. Our international operations are subject~~favorable terms or to ~~risks that are different from those we face in the United States, including the requirement to comply with changing, conflicting~~obtain new business, and unclear national and local regulatory requirements; Foreign Corrupt Practices Act, U.K. Bribery Act and other anti-corruption law compliance matters; cybersecurity and data protection laws; potential difficulties in staffing and labor disputes; differing local labor laws; managing and obtaining support and distribution for local operations; credit risk or financial condition of local clients; potential imposition of restrictions on investments; potentially adverse tax consequences, including imposition or increase of withholding, VAT and other taxes on remittances and other payments by subsidiaries; foreign exchange controls; and local political and social conditions. For example, in June 2016, the United Kingdom voted to leave the European Union ("Brexit"). Aramark has operated in the United Kingdom since 1972 and employs approximately 10,000 employees there today. While our operations in the United Kingdom do not represent a significant portion of our revenue, the United Kingdom's departure from the European Union could have a negative ~~effect~~impact on our ~~business there if Brexit results~~revenue. Even instances of food-borne illness, food tampering or contamination at a location served by one of our competitors could result in ~~a slow down of~~negative publicity regarding the ~~local economy or employment environment. As a country, the United Kingdom imports half of its~~ food ~~supply,~~service industry generally and ~~any change in tariffs, customs or tax would~~could negatively impact our ~~supply chain. In addition, the operating results of~~revenue. Future food safety issues may also from time to time disrupt our ~~non-U.S. subsidiaries are translated into U.S. dollars and those results are affected by movements in foreign currencies relative to the U.S. dollar.~~

We intend to continue to develop our business in emerging countries over the long term. Emerging international operations present several additional risks, including greater fluctuation in currencies relative to the U.S. dollar; economic and governmental instability; civil disturbances; volatility in gross domestic production; and nationalization and expropriation of private assets.

~~There can be no assurance that the foregoing factors will not have a material adverse effect on our international operations or on our consolidated financial condition and results of operations.~~

~~Continued or further unionization of our workforce may increase our costs and work stoppages could damage our business.~~

Approximately 43,000 employees in our North America operations are represented by unions and covered by collective bargaining agreements. The continued or further unionization of a significantly greater portion of our workforce could increase our overall costs at the affected locations and adversely affect our flexibility to run our business in the most efficient manner to remain competitive or acquire new business. In addition, ~~any significant increase in the number of work stoppages at our various operations could adversely affect our business, financial condition~~product recalls or ~~results of operations.~~

Wehealth concerns associated with food contamination may ~~incur significant liability as a result of our participation in multiemployer defined benefit pension plans.~~

A number of our locations operate under collective bargaining agreements. Under some of these agreements, we are obligated to contribute to multiemployer defined benefit pension plans. As a contributing employer to such plans, should we trigger either a “complete” or a “partial withdrawal,” we would be subject to withdrawal liability (or partial withdrawal liability) for our proportionate share of any unfunded vested benefits. In addition, if a multiemployer defined benefit pension plan fails to satisfy the minimum funding standards, we could be liable toalso increase our contributions to meet minimum funding standards. Also, if another participating employer withdraws from the plan or experiences financial difficulty, including bankruptcy, our obligation could increase. The financial status of certain of the plans to which we contribute has deteriorated in the recent past and continues to deteriorate and we proactively monitor the financial status of these and the other multiemployer defined benefit pension plans in which we participate. In addition, any increased funding obligations for underfunded multiemployer defined benefit pension plans could have an adverse financial impact on us.

~~Risks associated with the suppliers from whom our products are sourced could adversely affect our results of operations.~~

~~The~~ raw materials we use in our business and the finished products we sell are sourced from a wide variety of domestic and international suppliers. We seek to require our suppliers to comply with applicable laws and otherwise be certified as meeting our supplier standards of conduct. Our ability to find qualified suppliers who meet our standards, and to access raw materials and finished products in a timely and efficient manner is a challenge, especially with respect to suppliers located and goods sourced outside the United States. Insolvency experienced by suppliers could make it difficult for us to source the items we need to run our business. Political and economic stability in the countries in which foreign suppliers are located, the financial

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stability of suppliers, suppliers' failure to meet our supplier standards, labor problems experienced by our suppliers, the availability of raw materials to suppliers, cybersecurity issues, currency exchange rates, transport availability and cost, tariffs, inflation and other factors relating to the suppliers and the countries in which they are located are beyond our control. United States foreign trade policies, tariffs and other impositions on imported goods, trade sanctions imposed on certain countries, the limitation on the importation of certain types of goods or of goods containing certain materials from other countries and other factors relating to foreign trade are beyond our control. If one of our suppliers were to violate the law, or engage in conduct that results in adverse publicity, our reputation may be harmed simply due to our association with that supplier. These and other factors affecting our suppliers and our access to raw materials and finished products could adversely affect our results of operations.

In fiscal 2019, one distributor distributed approximately 48% of our food and non-food products in the United States and Canada, and if our relationship or their business were to be disrupted, we could experience disruptions to our operations and cost structure.

Although we negotiate the pricing and other terms for the majority of our purchases of food and related products in the U.S. and Canada directly with national manufacturers, we purchase these products and other items through Sysco Corporation and other distributors. Sysco, the main U.S. and Canadian distributor of our food and non-food products, and other distributors are responsible for tracking our orders and delivering products to our specific locations. If our relationship with, or the business of, Sysco were to be disrupted, we would have to arrange alternative distributors and our operations and cost structure could be adversely affected in the short term. Similarly, a sudden termination of the relationship with a significant provider in other geographic areas could in the short term adversely affect our ability to provide services and disrupt our client relationships in such areas.

~~Our business may suffer if we are unable to hire and retain sufficient qualified personnel or if labor costs increase.~~

From time to time, we have had difficulty in hiring and retaining qualified management personnel, particularly at the entry management level. We will continue to have significant requirements to hire such personnel. At times when the United States or other geographic regions experience reduced levels of unemployment, there may be a shortage of qualified workers at all levels. Given that our workforce requires large numbers of entry level and skilled workers and managers, low levels of unemployment when such conditions exist or mismatches between the labor markets and our skill requirements can compromise our ability in certain areas of our businesses to continue to provide quality service or compete for new business. We are also impacted by the costs and other effects of compliance with U.S. and international regulations affecting our workforce. These regulations are increasingly focused on employment issues, including wage and hour, healthcare, immigration, retirement and other employee benefits and workplace practices. Compliance and claims of non-compliance with these regulations could result in liability and expense to us. We also regularly hire a large number of part-time and seasonal workers, particularly in our food and support services segments. Any difficulty we may encounter in hiring such workers, including difficulties caused by immigration policies, could result in significant increases in labor costs, which could have a material adverse effect on our business, financial condition and results of operations. Competition for labor has at times resulted in wage increases in the past and future competition could substantially increase our labor costs. Due to the labor intensive nature of our businesses and the fact that two-thirds of our food and support services segments' revenue is from profit and loss contracts under which we have limited ability to pass along cost increases, a shortage of labor or increases in wage levels in excess of normal levels could have a material adverse effect on our results of operations.

~~Our business is contract intensive and may lead to client disputes.~~

Our business is contract intensive and we are parties to many contracts with clients all over the world. Our client interest contracts provide that client billings, and for some contracts the sharing of profits and losses, are based on our determinations of costs of service. Contract terms under which we base these determinations and, for certain government contracts, regulations governing our cost determinations, may be subject to differing interpretations which could result in disputes with our clients from time to time. Clients generally have the right to audit our contracts, and we periodically review our compliance with contract terms and provisions. If clients were to dispute our contract determinations, the resolution of such disputes in a manner adverse to our interests could negatively affect revenue and operating results. While we do not believe any reviews, audits or other such matters should result in material adjustments, if a large number of our client arrangements were modified in response to any such matter, the effect could be materially adverse to our business or results of operations.

Our operations and reputation may be adversely affected by disruptions to or breaches of our information systems or if our data is otherwise compromised.

We are increasingly utilizing information technology systems, including with respect to administrative functions, financial and operational data, ordering, point-of-sale processing and payment and the management of our supply chain, to enhance the efficiency of our business and to improve the overall experience of our customers. We maintain confidential, proprietary and

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personal information about, or on behalf of, our potential, current and former clients, customers, employees and other third parties in these systems or engage third parties in connection with storage and processing of this information. Such information includes large volumes of employee, client and third party data, including credit card numbers, social security numbers, healthcare information and other personal information. Our systems and the systems of our vendors and other third parties are subject to damage or interruption from power outages, computer or telecommunication failures, computer viruses, catastrophic events and implementation delays or difficulties, as well as usage errors by our employees or third party service providers. These systems are also vulnerable to an increasing threat of rapidly evolving cyber-based attacks, including malicious software, attempts to gain unauthorized access to data, including through phishing emails, attempts to fraudulently induce employees or others to disclose information, the exploitation of software and operating vulnerabilities, and physical device tampering/skimming at card reader units. The techniques used to obtain unauthorized access, disable or degrade service or sabotage systems change frequently, may be difficult to detect for a long time and often are not recognized until after an attack is launched or occurs. As a result, we and such third parties may be unable to anticipate these techniques or to implement adequate preventative measures. In addition, we or such third parties may decide to upgrade existing information technology systems from time to time to support the needs of our business and growth strategy and the risk of system disruption is increased when significant system changes are undertaken. During the normal course of business, we have experienced and expect to continue to experience cyber-based attacks and other attempts to compromise our information systems, although none, to our knowledge, has had a material adverse effect on our business, financial condition or results of operations. Any damage to, or compromise or breach of our systems or the systems of our vendors could impair our ability to conduct our business, result in transaction errors, result in corruption or loss of accounting or other data, which could cause delays in our financial reporting, and result in a violation of applicable privacy and other laws, significant legal and financial exposure, reputational damage, adverse publicity and a loss of confidence in our security measures. Any such event could cause us to incur substantial costs, including costs associated with systems remediation, client protection, litigation, lost revenue or the failure to retain or attract clients following an attack. The failure to properly respond to any such event could also result in similar exposure to liability. While we maintain insurance coverage that may cover certain aspects of cyber risks, such insurance coverage may be unavailable or insufficient to cover all losses or all types of claims that may arise. Further, as cybersecurity risks evolve, such insurance may not be available

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to us on commercially reasonable terms or at all. The occurrence of some or all of the foregoing could have a material adverse effect on our results of operations, financial condition, business and reputation.

We are subject to numerous laws and regulations in the U.S. and internationally as well as contractual obligations and other security standards, each designed to protect the personal information of clients, customers, employees and other third parties that we collect and maintain, such as the European Union General Data Protection Regulation (the “GDPR”), which took effect in May 2018, ~~and~~ the California Consumer Privacy Act of 2018 (the "CCPA"), which took effect on January 1, 2020, andthe forthcoming California Privacy Rights and Enforcement Act of 2020 (the “CPRA”), which expands upon the CCPA and is scheduled to take effect on January 1, ~~2020. A failure~~2023 (with a lookback to ~~comply with~~January 1, 2022). Additionally, as a global company we are subject to laws, rules, and regulations regarding cross-border data flows and recent legal developments have created increased complexity and uncertainty regarding transfers of personal data from the ~~GDPR could result in fines~~European Union to the U.S. For example, on July 16, 2020 the Court of upJustice of the European Union struck down a permitted personal data transfer mechanism between the European Union and the U.S. These recent developments will require us to ~~4% of annual global revenue. The CCPA provides for significant statutory fines~~review and ~~creates a private right of action for certain~~amend the legal mechanisms by which we make and receive such cross-border personal data ~~breaches.~~ transfers.

Because we accept debit and credit cards for payment from clients and customers, we are also subject to various industry data protection standards and protocols, such as payment network security operating guidelines and the Payment Card Industry Data Security Standard. In certain circumstances, payment card association rules and obligations make us liable to payment card issuers if information in connection with payment cards and payment card transactions that we hold is compromised, the liabilities for which ~~liabilities~~ could be substantial.

These laws, regulations and obligations are increasing in complexity and number, change frequently and increasingly conflict among the various countries in which we operate. Other jurisdictions, including ~~other states~~at both the federal and state level in the U.S., have enacted or are ~~enacting~~considering similar data protection laws, and/or are considering data localization laws that require data to stay within their borders. Our systems and the systems maintained or used by third parties and service providers to process data on our behalf may not be able to satisfy these changing legal and regulatory requirements, or may require significant additional investments or time to do so. If we fail to comply with these laws or regulations, we could be subject to significant litigation, monetary damages, regulatory enforcement actions or fines (for example, failure to comply with the GDPR could result in fines of up to 4% of annual global revenue) in one or more jurisdictions and we could experience a material adverse effect on our results of operations, financial condition and business.

~~Failure to maintain effective internal controls could adversely affect our business and stock price.~~

Our management is responsible for establishing and maintaining effective internal control over financial reporting, the effectiveness of which is evaluated based upon criteria established in Internal Control - Integrated Framework (2013) by the Committee of Sponsoring Organizations of the Treadway Commission. Internal control over financial reporting is a process to provide reasonable assurance regarding the reliability of financial reporting in accordance with accounting principles generally accepted in the United States. Because of its inherent limitations, internal control over financial reporting is not intended to provide absolute assurance that we would prevent or detect a misstatement of our financial statements or fraud. Any failure to maintain an effective system of internal control over financial reporting could limit our ability to report our financial results accurately and timely or to detect and prevent fraud. A significant financial reporting failure or material weakness in internal control over financial reporting could cause a loss of investor confidence and decline in the market price of our common stock.

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Risks Related to Our Indebtedness

Our leverage could adversely affect our ability to raise additional capital to fund our operations, limit our ability to react to changes in the economy or our industries, expose us to interest rate risk to the extent of our variable rate debt and prevent us from meeting our obligations.

We are highly leveraged. As of ~~September 27, 2019,~~October 2, 2020, our outstanding indebtedness was ~~$6,682.2~~$9,278.4 million. We had additional availability of ~~$897.8~~$80.1 million under our revolving credit facilities as of that date.

This degree of leverage could have important consequences, including:

•exposing us to the risk of increased interest rates as certain of our borrowings, including borrowings under our senior secured credit facilities and our receivables facility, are at variable rates of interest;

•making it more difficult for us to make payments on our indebtedness;

•increasing our vulnerability to general economic and industry conditions;

•requiring a substantial portion of cash flow from operations to be dedicated to the payment of principal and interest on our indebtedness, thereby reducing our ability to use our cash flow to fund our operations, capital expenditures and future business opportunities;

•restricting us from making strategic acquisitions or causing us to make non-strategic divestitures;

•limiting our ability to obtain additional financing for working capital, capital expenditures, debt service requirements, acquisitions and general corporate or other purposes;

•limiting our ability to adjust to changing market conditions and placing us at a competitive disadvantage compared to our competitors who are less highly leveraged; and

•limiting our ability to benefit from tax deductions for such payments under certain interest expense limitation rules included in the Tax Cuts and Jobs Act of ~~2017.~~2017 and pursuant to similar regulations in other countries.

We and our subsidiaries may be able to incur substantial additional indebtedness in the future, subject to the restrictions contained in our senior secured credit facilities and the indentures governing our senior notes. If new indebtedness is added to our current debt levels, the related risks that we now face could increase.

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On July 27, 2017, the U.K. Financial Conduct Authority announced that it intends to stop ~~persuading or compelling~~requiring banks to submit LIBOR rates after 2021. ~~It is unclear if at that time whether or not LIBOR will cease to exist or if new methods of calculating~~As a result, LIBOR will be ~~established such~~discontinued after 2021 and contracts and hedging relationships that ~~it continues~~use LIBOR as a reference rate will have to ~~exist after 2021. Recent proposals~~be modified to allow for ~~LIBOR reforms may result in the establishment of new methods of calculating LIBOR or the establishment of one or more~~an alternative benchmark ~~rates.~~rate. Although our Credit Agreement provides for application of successor rates based on prevailing market conditions, it is not currently possible to predict the effect of any establishment of alternative reference rates or any other reforms to LIBOR that may be enacted in the United Kingdom or elsewhere.

If our financial performance were to deteriorate, we may not be able to generate sufficient cash to service all of our indebtedness and may be forced to take other actions to satisfy our obligations under our indebtedness, which may not be successful.

Our ability to make scheduled payments on or to refinance our debt obligations depends on our financial condition and operating performance, which is subject to prevailing economic and competitive conditions and to certain financial, business and other factors beyond our ~~control.~~control, including the ongoing COVID pandemic. While we believe that we currently have adequate cash flows to service our indebtedness, if our financial performance were to deteriorate significantly, we might be unable to maintain a level of cash flows from operating activities sufficient to permit us to pay the principal, premium, if any, and interest on our indebtedness.

If, due to such a deterioration in our financial performance, our cash flows and capital resources were to be insufficient to fund our debt service obligations, we may be forced to reduce or delay investments and capital expenditures, or to sell assets, seek additional capital or restructure or refinance our indebtedness. These alternative measures may not be successful and may not permit us to meet our scheduled debt service obligations. In addition, if we were required to raise additional capital in the current financial markets, the terms of such financing, if available, could result in higher costs and greater restrictions on our business. In addition, although none of our significant long-term borrowings mature prior to ~~2021,~~2023, if we were to need to refinance our existing indebtedness, the conditions in the financial markets at that time could make it difficult to refinance our existing indebtedness on acceptable terms or at all. If such alternative measures proved unsuccessful, we could face substantial liquidity problems and might be required to dispose of material assets or operations to meet our debt service and other obligations. Our senior secured credit agreement and the indentures governing our senior notes restrict our ability to dispose of assets and use the proceeds from any disposition of assets and to refinance our indebtedness. We may not be able to consummate those

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dispositions or to obtain the proceeds that we could realize from them and these proceeds may not be adequate to meet any debt service obligations then due.

Our debt agreements contain restrictions that limit our flexibility in operating our business.

Our senior secured credit agreement and the indentures governing our senior notes contain various covenants that limit our ability to engage in specified types of transactions. These covenants limit our and our restricted subsidiaries' ability to, among other things:

•incur additional indebtedness, refinance or restructure indebtedness or issue certain preferred shares;

•pay dividends on, repurchase or make distributions in respect of our capital stock, make unscheduled payments on our notes, repurchase or redeem our senior notes or make other restricted payments;

•make certain investments;

•sell certain assets;

•create liens;

•consolidate, merge, sell or otherwise dispose of all or substantially all of our assets; and

•enter into certain transactions with our affiliates.

In addition, our senior secured revolving credit facility requires us to satisfy and maintain specified financial ratios and other financial condition tests. Our ability to meet those financial ratios and tests can be affected by events beyond our control and, in the event of a significant deterioration of our financial performance, there can be no assurance that we will satisfy those ratios and tests. A breach of any of these covenants could result in a default under the senior secured credit agreement. Upon our failure to maintain compliance with these covenants that is not waived by the lenders under the revolving credit facility, the lenders under the senior secured credit facilities could elect to declare all amounts outstanding under the senior secured credit facilities to be immediately due and payable and terminate all commitments to extend further credit under such facilities. If we were unable to repay those amounts, the lenders under the senior secured credit facilities could proceed against the collateral granted to them to secure that indebtedness. We have pledged a significant portion of our assets as collateral under the senior secured credit agreement. If the lenders under the senior secured credit facilities accelerate the repayment of borrowings, there can be no assurance that we will have sufficient assets to repay those borrowings, as well as our unsecured indebtedness. If our

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senior secured indebtedness was accelerated by the lenders as a result of a default, our senior notes may become due and payable as well. Any such acceleration may also constitute an amortization event under our receivables facility, which could result in the amount outstanding under that facility becoming due and payable.

~~Risks Related~~In order to ~~Ownership of Our Common Stock~~

Our share price may change significantly, and you may not be able to resell shares of our common stock at or above the price you paid or at all, and you could lose all or part of your investment as a result.

~~The trading price of our common stock, as reported by the NYSE, could fluctuate due to a number of factors such as those listed~~increase financial flexibility in ~~“—Risks Related to Our Business” and include, but are not limited~~response to the ~~following, some~~COVID-19 pandemic, we entered into Amendment No. 9 to our senior secured credit agreement, which suspends our Consolidated Secured Debt Ratio covenant for four fiscal quarters commencing with the fourth quarter of ~~which are beyond~~fiscal 2020 through the third quarter of fiscal 2021 (the “Covenant Waiver”). The Covenant Waiver is subject to, among other things, ongoing compliance with a minimum liquidity condition of $400.0 million and restrictions on making certain restricted payments and investments in unrestricted subsidiaries (see Note 5 to the audited consolidated financial statements). To the extent our ~~control:~~

~~quarterly variations in our results of operations;~~

~~results of operations that vary~~business has not recovered from the ~~expectations~~impacts of ~~securities analysts~~the COVID-19 pandemic prior to the time that the Covenant Waiver expires and ~~investors;~~

~~results of operations that vary~~we are otherwise unable to satisfy our Consolidated Secured Debt Ratio covenant, we may need to seek an additional waiver from ~~those of~~ our ~~competitors;~~

~~changes in expectations as~~senior secured lenders. Any further covenant relief may require additional payments, concessions or limitations related to our ~~future financial performance, including financial estimates by securities analysts~~business and ~~investors;~~

~~announcements by us, our competitors or our vendors of significant contracts, acquisitions, divestitures, joint marketing relationships, joint ventures or capital commitments;~~

~~announcements by third parties of significant claims or proceedings against us;~~

~~future sales of our common stock;~~

~~general domestic and international economic conditions; and~~

~~unexpected and sudden changes in senior management.~~

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Furthermore, the stock market has experienced extreme volatility that, in some cases, has been unrelated or disproportionate to the operating performance of particular companies. These broad market and industry fluctuations may adversely affect the market price of our common stock, regardless of our actual operating performance.

In the past, following periods of market volatility, stockholders have instituted securities class action litigation. If we were involved in securities litigation, it could have a substantial cost and divert resources and the attention of executive management from our business regardless of the outcome of such litigation.operations.

There can be no assurance that we will continue to pay dividends on our common stock, and our indebtedness could limit our ability to pay dividends on our common stock.

Payment of cash dividends on our common stock is subject to our compliance with applicable law and depends on, among other things, our results of operations, financial condition, level of indebtedness, capital requirements, contractual restrictions, business prospects and other factors that our board of directors may deem relevant. Our senior secured credit facilities and the indentures governing our senior notes contain, and the terms of any future indebtedness we or our subsidiaries incur may contain limitations on our ability to pay dividends. For more information, see Item 7. "Management's Discussion and Analysis of Financial Condition and Results of ~~Operations.~~Operations—Liquidity and Capital Resources—Covenant Compliance." In addition, our decision to pay dividends is impacted by results of operations and available cash, which has and will continue to be impacted by the current COVID-19 pandemic. Under the Covenant Waiver, in order to pay dividends of up to $29.0 million per quarter, we must maintain minimum liquidity of $600.0 million at all times during such quarter. To the extent our liquidity falls below $600.0 million in any quarter, our dividend payments would be limited to $10.0 million for such quarter which would be substantially less than the amount of dividends we have historically paid. Although we have paid cash dividends in the past, there can be no assurance that we will continue to pay any dividend in the future.

Risks Related to Ownership of Our Common Stock and Provisions in our Organizational Documents

The trading price of our common stock, as reported by the NYSE, has in the past and could in the future fluctuate due to a number of factors such as those listed in “—Risks Related to Our Business” and include, but are not limited to, the following, some of which are beyond our control:

•quarterly variations in our results of operations;

•results of operations that vary from the expectations of securities analysts and investors;

•results of operations that vary from those of our competitors;

•changes in expectations as to our future financial performance, including financial estimates by securities analysts and investors;

•announcements by us, our competitors or our vendors of significant contracts, acquisitions, divestitures, joint marketing relationships, joint ventures or capital commitments;

•announcements by third parties of significant claims or proceedings against us;

•future sales of our common stock;

•general domestic and international economic conditions; and

•unexpected and sudden changes in senior management.

Furthermore, the stock market has experienced extreme volatility that, in some cases, has been unrelated or disproportionate to the operating performance of particular companies. As evidenced by the impact of COVID-19, these broad market and industry fluctuations may adversely affect the market price of our common stock, regardless of our actual operating performance.

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Anti-takeover provisions in our organizational documents could delay or prevent a change of control.

Certain provisions of our amended and restated certificate of incorporation and amended and restated bylaws may have an anti-takeover effect and may delay, defer or prevent a merger, acquisition, tender offer, takeover attempt or other change of control transaction that a stockholder might consider in its best interest, including those attempts that might result in a premium over the market price for the shares held by our stockholders.

These provisions provide for, among other things:

•the ability of our board of directors to issue one or more series of preferred stock;

•advance notice for nominations of directors by stockholders and for stockholders to include matters to be considered at our annual meetings;

•certain limitations on convening special stockholder meetings;

•the removal of directors only upon the affirmative vote of the holders of at least 75% in voting power of all the then-outstanding common stock of the company entitled to vote thereon, voting together as a single class; and

•that certain provisions may be amended only by the affirmative vote of the holders of at least 75% in voting power of all the then-outstanding common stock of the company entitled to vote thereon, voting together as a single class.

These anti-takeover provisions could make it more difficult for a third-party to acquire us, even if the third-party's offer may be considered beneficial by many of our stockholders. As a result, our stockholders may be limited in their ability to obtain a premium for their shares.

Our amended and restated certificate of incorporation designates the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders' ability to obtain a favorable judicial forum for disputes with us or our directors, officers or other employees.

Our amended and restated certificate of incorporation provides that, with certain limited exceptions, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for any stockholder (including any beneficial owner) to bring (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of fiduciary duty owed by any director or officer of the Company owed to us or our stockholders, creditors or other constituents, (iii) any action asserting a claim against us or any director or officer of the Company arising pursuant to any provision of the Delaware General Corporation Law or our amended and restated certificate of incorporation or our amended and restated bylaws, or (iv) any action asserting a claim against the Company or any director or officer of the Company governed by the internal affairs doctrine. Any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock is deemed to have received notice of and consented to the foregoing provisions. This choice of forum provision may limit a stockholder's ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers or other employees, which may discourage such lawsuits against us and our directors, officers and employees. Alternatively, if a court were to find this choice of forum provision inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such matters in other jurisdictions, which could adversely affect our business, financial condition or results of operations.

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Item 1B. Unresolved Staff Comments

Not Applicable.

Item 2. Properties

Our principal executive offices are currently leased at 2400 Market Street, Philadelphia, Pennsylvania 19103. Our principal real estate is primarily comprised of Uniform facilities. As of ~~September 27, 2019,~~October 2, 2020, we operated ~~404~~over 350 service facilities in our Uniform segment, consisting of industrial laundries, cleanroom laundries, warehouses, distribution centers, satellites, depots, ~~stand alone~~standalone garages, shared service centers and administrative offices that are located in ~~43 states,~~across the United States, as well as in Mexico, Canada and Puerto Rico. Of these, approximately ~~51%~~47% are leased and approximately ~~49%~~53% are owned. We own six buildings that we use in our FSS United States segment, including several office/warehouse spaces, and we lease ~~134~~110 premises, consisting of offices, office/warehouses and distribution centers. In addition, we own ~~a distribution center,~~ one office and ~~seven~~six other properties and lease 7470 facilities throughout the world that we use in our FSS International segment. We also maintain other real estate and leasehold improvements, which we use in the Uniform and FSS segments. No individual parcel of real estate owned or leased is of material significance to our total assets.

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Item 3. Legal Proceedings

Our business is subject to various federal, state and local laws and regulations governing, among other things, the generation, handling, storage, transportation, treatment and disposal of water wastes and other substances. We engage in informal settlement discussions with federal, state, local and foreign authorities regarding allegations of violations of environmental laws in connection with our operations or businesses conducted by our predecessors or companies that we have acquired, the aggregate amount of which and related remediation costs we do not believe should have a material adverse effect on our financial condition or results of operations as of ~~September 27, 2019.~~October 2, 2020.

From time to time, ~~the Company~~we and ~~its~~our subsidiaries are party to various legal actions, proceedings and investigations involving claims incidental to the conduct of their business, including those brought by clients, consumers, employees, government entities and third parties under, among others, federal, state, international, national, provincial and local employment laws, wage and hour laws, discrimination laws, immigration laws, human health and safety laws, import and export controls and customs laws, environmental laws, false claims or whistleblower statutes, minority, women and disadvantaged business enterprise statutes, tax codes, antitrust and competition laws, consumer protection statutes, procurement regulations, intellectual property laws, food safety and sanitation laws, cost and accounting principles, the Foreign Corrupt Practices Act, the U.K. Bribery Act, other anti-corruption laws, lobbying laws, motor carrier safety laws, data privacy and security laws and alcohol licensing and service laws, or alleging negligence and/or breaches of contractual and other obligations. Based on information currently available, advice of counsel, available insurance coverage, established reserves and other resources, ~~the Company does~~we do not believe that any such actions, proceedings or investigations are likely to be, individually or in the aggregate, material to ~~its~~our business, financial condition, results of operations or cash flows. However, in the event of unexpected further developments, it is possible that the ultimate resolution of these matters, or other similar matters, if unfavorable, may be materially adverse to ~~the Company's~~our business, financial condition, results of operations or cash flows.

Item 4. Mine Safety Disclosures

Not Applicable.

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Information About Our Executive Officers

Our executive officers as of November ~~26, 2019~~24, 2020 are as follows:


Name	Age	Position	With Aramark Since	Name	Age	Position	With Aramark Since
John J. Zillmer	64	Chief Executive Officer	2019	John J. Zillmer	65	Chief Executive Officer	2019
Stephen P. Bramlage, Jr.	49	Executive Vice President and Chief Financial Officer	2015
Thomas G. Ondrof				Thomas G. Ondrof	56	Executive Vice President and Chief Financial Officer	2020
Lynn B. McKee	64	Executive Vice President, Human Resources	1980	Lynn B. McKee	65	Executive Vice President, Human Resources	1980
Lauren A. Harrington	44	Senior Vice President and General Counsel	2006	Lauren A. Harrington	45	Senior Vice President and General Counsel	2006
Keith Bethel	52	Chief Growth Officer	1991
Marc A. Bruno	48	Chief Operating Office, U.S. Food and Facilities	1993	Marc A. Bruno	49	Chief Operating Officer, U.S. Food and Facilities	1993

John J. Zillmer was appointed Chief Executive Officer and a member of the Board in October ~~2019.~~2019 and was elected in connection with entering into the Stewardship Framework Agreement. Prior to joining us, Mr. Zillmer served as Chief Executive Officer and Executive Chairman of Univar from 2009 to 2012. Prior to that, he served as Chairman and Chief Executive Officer of Allied Waste Industries from 2005 to 2008 and held various positions at Aramark, including Vice President of Operating Systems, Regional Vice President, Area Vice President, Executive Vice President Business Dining Services, President of Business Services Group, President of International and President of Global Food and Support Services, from 1986 to 2005. Mr. Zillmer serves on the board of directors as Non-Executive Chairman of CSX Corporation, as well as the board of directors of ~~Veritiv Corporation and~~ Ecolab, Inc. Mr. Zillmer was formerly on the board of directors of Veritiv Corporation, Performance Food Group (PFG) Company, Inc. and Reynolds American Inc.

~~Stephen P. Bramlage, Jr.~~Thomas G. Ondrof was appointed Executive Vice President and Chief Financial Officer in ~~April 2015.~~January 2020. Prior to joining us, Mr. ~~Bramlage~~Ondrof served as ~~Senior Vice President~~Head of Strategic Growth of Performance Food Group from March 2018 to December 2019 and Chief Financial Officer of ~~Owens-Illinois, Inc.~~Performance Food Group from ~~2012~~October 2016 to March ~~2015.~~2018. Prior to that, he served ~~as President~~in a variety of ~~Owens-Illinois Asia Pacific from 2011 to 2012; General Manager of Owens-Illinois New Zealand from 2010 to 2011; Vice President of Finance of Owens-Illinois, Inc. from 2008 to 2010; Vice President~~financial and business development leadership roles at Compass Group North America, including Chief Development Officer, Chief Strategy Officer and Chief Financial ~~Officer of Owens-Illinois Europe in 2008; and Vice President and Treasurer of Owens-Illinois, Inc. from 2006 to 2008.~~Officer.

Lynn B. McKee was appointed Executive Vice President, Human Resources in May 2004. From August 2012 to August 2013, Ms. McKee served as Executive Vice President, Human Resources and Communications. From January 2004 to May 2004, Ms. McKee served as our Senior Vice President of Human Resources and from 2001 to 2003, she served as Senior Vice President of Human Resources for our Food and Support Services Group. From 1998 to 2001, she served as our Staff Vice President, Executive Development and Compensation. Ms. McKee serves on the board of directors of Bryn Mawr Bank Co.

Lauren A. Harrington was appointed Senior Vice President and General Counsel in March 2019. From August 2009 to March 2019, Ms. Harrington served as Vice President and Associate General Counsel and from May 2006 to August 2009, she served as Assistant General Counsel. Before joining us, Ms. Harrington was an Associate at WilmerHale LLP.

~~Keith Bethel~~ was appointed Chief Growth Officer in October 2016. From June 2016 to September 2016, Mr. Bethel served as Executive Vice President, Growth for Facilities, Healthcare and Higher Education, and from October 2013 to May 2016, he served as Executive Vice President, Growth for Higher Education. From February 2011 to October 2013, Mr. Bethel served as Regional Vice President, East for Higher Education. Prior to that, he served as Vice President, Compliance for K-12 from 2009 to 2011 and various other positions for our Healthcare Group, including Vice President Operations, District Manager, General Manager, Assistant Director, Retail Manager and Catering Manager, from 1991 to 2009.

Marc A. Bruno was appointed Chief Operating Officer, U.S. Food and Facilities onin November ~~19,~~ 2019. From 2018 to November 2019, Mr. Bruno served as Chief Operating Officer, Sports, Leisure, Corrections, Facilities and K-12. From 2014 to 2018, Mr. Bruno served as Chief Operating Officer, Sports, Leisure and Corrections. From 2008 to 2014, he served as President, Sports and Entertainment, and prior to that he served in various other positions within our food and support services business from 1993 to 2008. Mr. Bruno serves on the board of directors of United Rentals, Inc.

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PART II


~~Item 5.~~	~~Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities~~

Item 5.Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information

Shares of our common stock began trading on December 12, 2013 and are quoted on the ~~New York Stock Exchange (“NYSE”)~~NYSE under the ticker symbol “ARMK.” ~~Prior to that date, there was no public market for our common stock.~~ As of ~~November 22, 2019,~~October 30, 2020, there were approximately ~~1,021~~1,049 holders of record of our outstanding common stock. This does not include persons who hold our common stock in nominee or “street name” accounts through brokers or banks.

Stock Price Performance

This performance graph and related information shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or incorporated by reference into any filing of Aramark under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

The following graph shows a comparison from October ~~3, 2014,~~2, 2015, the last trading day of fiscal ~~2014,~~2015, through ~~September 27, 2019~~October 2, 2020 of the cumulative total return for our common stock, The Standard & Poor’s (“S&P”) 500 Stock Index and The Dow Jones Consumer Non-Cyclical Index. The graph assumes that $100 was invested in ~~the Company’s~~our common stock and in each index at the market close on October ~~3, 2014~~2, 2015 and assumes that all dividends were reinvested. The stock price performance of the following graph is not necessarily indicative of future stock price performance.


	October 3, 2014		October 2, 2015		September 30, 2016		September 29, 2017		September 28, 2018		September 27, 2019			October 2, 2015	September 30, 2016	September 29, 2017	September 28, 2018	September 27, 2019	October 2, 2020
Aramark		$100.0		$116.6		$143.8		$153.6		$162.7		$162.7	Aramark	$100.0	$123.4	$131.7	$139.5	$139.5	$89.4
S&P 500		$100.0		$102.9		$110.2		$128.0		$148.1		$150.5	S&P 500	$100.0	$107.1	$124.5	$144.0	$146.3	$165.4
Dow Jones Consumer Non-Cyclical Index		$100.0		$115.2		$117.9		$131.8		$169.9		$171.7	Dow Jones Consumer Non-Cyclical Index	$100.0	$102.4	$114.4	$147.5	$149.1	$183.2

Unregistered Sales of Equity Securities

There were no unregistered sales of equity securities during the fiscal year ended ~~September 27, 2019~~October 2, 2020 which have not been previously disclosed in a quarterly report on Form 10-Q or a current report on Form 8-K.

Purchases of Equity Securities by the Issuer

There were no repurchases of equity securities by ~~the Company~~us in the fourth fiscal quarter ended ~~September 27, 2019.~~

October 2, 2020.

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Item 6. Selected Financial Data

The following table presents selected consolidated financial data. This information should be read in conjunction with the audited consolidated financial statements and the related notes thereto, Management’s Discussion and Analysis of Financial Condition and Results of Operations, and Risk Factors sections, each included elsewhere in this Annual Report on Form 10-K.


(dollars in millions, except per share amounts)	Fiscal Year Ended on or near September 30(1)
	2020(2)(3)		2019(4)		2018(5)		2017		2016
Income Statement Data:
Revenue	$	12,829.6	$	16,227.3	$	15,789.6	$	14,604.4	$	14,415.8
Depreciation and amortization	595.2		592.6		596.2		508.2		495.8
Operating (loss) income	(264.9)		891.2		818.4		801.6		741.4
Interest and Other Financing Costs, net	382.8		335.0		346.6		280.9		310.5
Net (loss) income(6)	(461.4)		448.5		568.4		374.2		288.2
Net (loss) income attributable to Aramark stockholders(6)	(461.5)		448.5		567.9		373.9		287.8
Basic (loss) earnings per share attributable to Aramark stockholders(6)	($1.83)		$1.82		$2.31		$1.53		$1.19
Diluted (loss) earnings per share attributable to Aramark stockholders(6)	($1.83)		$1.78		$2.24		$1.49		$1.16
Cash dividends declared per common share	$0.44		$0.44		$0.43		$0.41		$0.39
Balance Sheet Data (at period end):
Total Assets	$	15,712.7	$	13,736.3	$	13,720.1	$	11,006.2	$	10,582.1
Long-Term Borrowings	9,178.5		6,612.2		7,213.1		5,190.3		5,223.5
Stockholders' Equity	2,736.0		3,320.0		3,029.6		2,459.1		2,161.0

(1)Our fiscal year ends on the Friday nearest to September 30th. Fiscal years 2020, 2019, 2018, 2017 and 2016 refer to the fiscal years ended October 2, 2020, September 27, 2019, September 28, 2018, September 29, 2017 and September 30, 2016, respectively. Fiscal 2020 was a fifty-three week year. All other periods presented were fifty-two week years.

(2)Includes impact of COVID-19 and the CARES Act (see Notes 1 and 10, respectively, to the audited consolidated financial statements). To enhance our cash position as a result of COVID-19, we increased borrowings under our revolving credit facility and Aramark Services, Inc., our indirect wholly owned subsidiary, issued $1,500.0 million aggregate principal amount of 6.375% Senior Notes due May 1, 2025.

(3)During fiscal 2020, we adopted Accounting Standards Codification 842, Leases, which now records most leases on the balance sheet (see Note 8 to the audited consolidated financial statements).

(4)During fiscal 2019, we adopted Accounting Standards Codification 606, Revenue from Contracts with Customers. In addition, we sold our Healthcare Technologies business in the first quarter of fiscal 2019.

(5)During fiscal 2018, we acquired Avendra and AmeriPride (see Note 2 to the audited consolidated financial statements). To finance these acquisitions, we entered into a U.S. dollar denominated term loan due 2025 and issued 5.000% Senior Notes due 2028.

(6)In fiscal 2018, the federal statutory income tax rate decreased from 35.0% to 21.0% through the passage of the "Tax Cuts and Jobs Act." This resulted in a non-cash tax benefit of approximately $237.8 million recorded in fiscal 2018 to the (benefit) provision for income taxes on the audited Consolidated Statements of (Loss) Income.

(dollars in millions, except per share amounts)
Fiscal Year Ended on or near
September 30⁽¹⁾

2019⁽²⁾⁽³⁾

2018⁽³⁾⁽⁴⁾

2017⁽⁴⁾

2016⁽⁴⁾

2015⁽⁴⁾
Income Statement Data:
Revenue $ 16,227.3
$ 15,789.6
$ 14,604.4
$ 14,415.8
$ 14,329.1
Depreciation and amortization 592.6
596.2
508.2
495.8
504.0
Operating income 891.2
818.4
801.6
741.4
625.2
Interest and Other Financing Costs, net 335.0
346.6
280.9
310.5
283.2
Net income⁽⁵⁾
448.5
568.4
374.2
288.2
237.0
Net income attributable to Aramark stockholders⁽⁵⁾
448.5
567.9
373.9
287.8
235.9
Basic earnings per share attributable to Aramark stockholders⁽⁵⁾

$1.82

$2.31

$1.53

$1.19

$0.99
Diluted earnings per share attributable to Aramark stockholders⁽⁵⁾

$1.78

$2.24

$1.49

$1.16

$0.96
Cash dividends declared per common share
$0.44

$0.43

$0.41

$0.39

$0.35
Balance Sheet Data (at period end):
Total Assets $ 13,736.3
$ 13,720.1
$ 11,006.2
$ 10,582.1
$ 10,196.4
Long-Term Borrowings 6,612.2
7,213.1
5,190.3
5,223.5
5,184.6
Stockholders' Equity 3,320.0
3,029.6
2,459.1
2,161.0
1,883.4


~~(1)~~	Our fiscal year ends on the Friday nearest to September 30th. Fiscal years 2019, 2018, 2017, 2016 and 2015 refer to the fiscal years ended September 27, 2019, September 28, 2018, September 29, 2017, September 30, 2016 and October 2, 2015, respectively. All periods presented were fifty-two week years.


~~(2)~~	~~Includes impact of the adoption of Accounting Standards Codification 606,~~ ~~Revenue from Contracts with Customers,~~ ~~and the sale of our Healthcare Technologies business in the first quarter of fiscal 2019 (see Notes 7 and 2, respectively, to the audited consolidated financial statements).~~


~~(3)~~	~~Includes impact of the acquisitions of Avendra and AmeriPride. To finance these acquisitions, we entered into a U.S. dollar denominated term loan due 2025 and issued 5.000% Senior Notes due 2028.~~


~~(4)~~	~~Operating income and Interest and Other Financing Costs, net were restated to reflect the adoption of Accounting Standards Update 2017-07,~~ ~~Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost~~ ~~(see Note 1 to the audited consolidated financial statements).~~


~~(5)~~	In fiscal 2018, the federal statutory income tax rate decreased from 35.0% to 21.0% through the passage of the "Tax Cuts and Jobs Act." This resulted in a non cash tax benefit of approximately $237.8 million recorded in fiscal 2018 to the provision (benefit) for income taxes on the Consolidated Statements of Income.

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Item 7.

MANAGEMENT’S DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of Aramark's (the "Company, "we," "our" and "us") financial condition and results of operations for the fiscal years ended October 2, 2020 and September 27, 2019 ~~and~~ ~~September 28, 2018~~ should be read in conjunction with Selected Consolidated Financial Data and our audited consolidated financial statements and the notes to those statements. Discussion and analysis of our financial condition and results of operations for the fiscal year ended September ~~28, 2018~~27, 2019 compared to the fiscal year ended September ~~29, 2017~~28, 2018 is included under the heading Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Results of Operations - Fiscal ~~2018~~2019 Compared to Fiscal ~~2017~~2018 and - Liquidity and Capital Resources” in our Annual Report on Form 10-K filed for the fiscal year ended September ~~28, 2018~~27, 2019 with the Securities and Exchange Commission ("SEC") on November ~~21, 2018.~~26, 2019.

Our discussion contains forward-looking statements, such as our plans, objectives, opinions, expectations, anticipations, intentions and beliefs, that are based upon our current expectations but that involve risks and uncertainties. Actual results and the timing of events could differ materially from those anticipated in those forward-looking statements as a result of a number of factors, including those set forth under "Risk Factors," "Special Note About Forward-looking Statements" and "Business" sections and elsewhere in this Annual Report on Form 10-K ("Annual Report"). In the following discussion and analysis of financial condition and results of operations, certain financial measures may be considered “non-GAAP financial measures” under SEC rules. These rules require supplemental explanation and reconciliation, which is provided elsewhere in this Annual Report on Form 10-K.

Overview

We are a leading global provider of food, facilities and uniform services to education, healthcare, business & industry and sports, leisure & corrections clients. Our core market is the United States, which is supplemented by an additional 18-country footprint. Through our established brand, broad geographic presence and employees, we anchor our business in our partnerships with thousands of education, healthcare, business, sports, leisure and corrections clients. Through these partnerships we serve millions of consumers including students, patients, employees, sports fans and guests worldwide.

We operate our business in three reportable segments:

•Food and Support Services United States ("FSS United States") - Food, refreshment, specialized dietary and support services, including facility maintenance and housekeeping, provided to business, educational and healthcare institutions and in sports, leisure and other facilities serving the general public in the United States.

•Food and Support Services International ("FSS International") - Food, refreshment, specialized dietary and support services, including facility maintenance and housekeeping, provided to business, educational and healthcare institutions and in sports, leisure and other facilities serving the general public. We have operations in 18 countries outside the United States. Our largest international operations are in Canada, Chile, China, Germany, Ireland and the United Kingdom, and in a majority of these countries we are one of the leading food and/or facility services providers. We also have operations in Japan through our 50% ownership of AIM Services Co., Ltd., which is a leader in providing outsourced food services in Japan.

•Uniform and Career Apparel ("Uniform") - Provides a full service employee uniform solution, including design, sourcing and manufacturing, delivery, cleaning and maintenance on a contract basis. We directly market personalized uniforms and accessories, including personal protective equipment ("PPE"), provide managed restroom services and rent uniforms, work clothing, outerwear, particulate-free garments and non-garment items and related services, including mats, shop towels and first aid supplies, to clients in a wide range of industries in the United States, Canada, Puerto Rico and through a joint venture in Japan, including the manufacturing, transportation, construction, restaurant and hotel, healthcare and pharmaceutical industries.

Our Food and Support Services operations focus on serving clients in five principal sectors: Business & Industry, Education, Healthcare, Sports, Leisure & Corrections and Facilities & Other. Our FSS International reportable segment provides a similar range of services as those provided to our FSS United States clients and operates in the same sectors. Administrative expenses not allocated to our three reportable segments are presented separately as corporate expenses.

During fiscal 2018, we acquired Avendra, LLC ("Avendra") and AmeriPride Services, Inc. ("AmeriPride") in separate transactions (see Note 2 to the audited consolidated financial statements). The Avendra acquisition consideration was $1,386.4 million, partially offset by $87.3 million of cash and restricted investments acquired. The AmeriPride acquisition consideration was $995.4 million, partially offset by $84.9 million of cash acquired. We incurred new debt to finance both the Avendra and

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AmeriPride acquisitions. Our earnings ~~have been impacted and we expect to continue to be~~were impacted for some period following

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the closings as a result of these acquisitions, due to, among other factors, merger and integration costs as well as depreciation and amortization resulting from purchase accounting and higher interest expense as a result of the new debt to finance the transactions. As a part of the integration of Avendra and AmeriPride, we have incurred ~~$92~~$120 million of ~~charges~~charges.

Impact of COVID-19 on our Business

COVID-19 has disrupted and ~~expect~~is expected to ~~incur approximately $25 million~~continue to ~~$30 million~~disrupt our business, which has and could continue to materially affect our operating results, cash flows and/or financial condition for an extended period of ~~additional charges over~~time. We began experiencing a significant decline in our operations due to COVID-19 towards the ~~next 12 months.~~

~~In the~~end of our second quarter of fiscal ~~2018, we launched~~2020, which has continued through our fourth quarter of fiscal 2020. The decline in our operations from COVID-19 caused a material deterioration in our revenues, operating income (loss) and net income (loss) for the ~~next phase~~fiscal year ended October 2, 2020. COVID-19 has adversely affected global economies, financial markets and the overall environment for our business. The ongoing impact of COVID-19 on our longer-term operational and financial performance will depend on future developments, many of which are outside of our ~~program related~~control, and all of which are highly uncertain and cannot be predicted

In response to ~~food, labor~~COVID-19, we continue to remain principally focused on the safety and ~~selling~~well-being of our employees, clients and everyone we serve, while simultaneously taking timely, proactive measures to adapt to the current environment. We continue to modify our business model in response to the disruption caused by COVID-19 by strengthening our liquidity position, focusing on flexible, low fixed-cost operations and diversifying our service offerings, geographic mix and client portfolio.

While certain of our operating sectors have been significantly impacted to date, we continue to work toward mitigating these negative impacts. These efforts have and continue to include significant cost reduction efforts toward variable and fixed costs, including furlough and permanent reductions of labor. These efforts have also included contractual negotiations and efforts to provide additional products and services arising in the current environment. We have also leveraged relief provisions under the Coronavirus Aid, Relief and Economic Security Act ("CARES Act") and other foreign governmental programs. The operating environment, however, remains very fluid with changes in the number of COVID-19 cases significantly impacting the ability and willingness of private businesses and governments to open or remain open, even at limited levels. We continue to work closely with clients and all constituencies in this environment.

In the FSS United States segment, the impacts to our operating sectors are further described as follows:

•Education – While classes did resume for the current school year, a substantial number of schools opened with online or hybrid approaches which negatively impacted the business. In addition, for those with in-person learning, safety and distance restrictions have limited our traditional service offerings. Governmental support for alternative meals and feeding in K-12, however, helped partially offset these reductions and limitations.

•Sports, Leisure & Corrections – Our sports business has been and continues to be significantly impacted by the initial suspension of professional sports seasons and postponement of concerts and events. Sports later proceeded with Major League Baseball, the National Hockey League and the National Basketball Association playing without fans as an early solution. The National Football League has also begun their season largely without fans, though limited numbers have been allowed to attend in certain locales as the season has progressed. Leisure has also been impacted due to closures and restrictions in our parks, attractions and conference centers; however, many parks and attractions later re-opened across the country with modified operations to meet the safety and hygiene standards required in today’s environment. Corrections continues to not be materially impacted.

•Business & Industry – Office closures and remote working resulting from stay-at-home orders and similar government mandates and voluntary office reductions or closures, have reduced overall volumes, including catering. Further, the extended duration of the virus' impact has similarly extended return to work plans. Nonetheless, we continue to serve businesses and geographies that still require service, including financial, manufacturing and pharmaceutical industries, and continue to work with all clients as they plan returns or increases in population.

•Facilities & Other – Although this sector has experienced some impact resulting from facility closures, we are providing more frequent and comprehensive services and products at certain locations as well.

•Healthcare – While this sector has experienced some disruption based on facility restrictions of patient services and visitation, we continue to expect relative stability as the return of elective procedures in the fourth quarter of fiscal 2020 and the demand for environmental services has helped provide support.

Within the FSS International segment, we are at various stages of response depending on geography. China has largely recovered and we continue to have new client wins—particularly in Healthcare—due to our efforts on the frontlines. Europe is facing additional restrictions and some levels of lockdown, which vary based on country-specific government mandates. We

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continue to experience an impact from COVID-19 in South America and in our 50% ownership of AIM Services Co., Ltd in Japan. In addition, we have experienced some recovery in certain lines of business in Canada.

In the Uniform segment, our business serves a range of clients. Operations continue for essential businesses and now most of our non-essential clients are back operating as well, although in certain areas of North America, due to worsening conditions of the pandemic, some of these businesses have been forced to shut down again. In addition, we continue to be a solution-oriented service focusing on safety and hygiene, including a heightened demand for PPE materials amongst our clients. We have redeployed production lines in order to manufacture essential PPE for hospital employees and other clients across North America.

In all business segments, we continue to leverage our flexible operating model to execute cost mitigation plans while continuing to support our clients. As noted earlier, we implemented several cost reduction initiatives, including renegotiations of client contracts, salary and other compensation adjustments and reductions to general ~~administrative initiatives~~corporate expenses. During our third and fourth quarters of fiscal 2020, we made changes to ~~generate additional~~our organization to align our cost ~~savings.~~base to best support our clients' needs as we navigate the current environment and focus on our long-term strategy. These ~~initiatives include a reduction in~~actions included headcount ~~through reorganization~~reductions and ~~integration. Efforts related to this phase have resulted in~~we incurred severance charges of approximately ~~$46~~$145.8 million during the fiscal ~~2019,~~year ended October 2, 2020, which ~~includes $8.2 million for~~are recorded in both “Cost of services provided" and “Selling and general corporate expenses” in the ~~relocation~~audited Consolidated Statements of ~~our headquarters facility.~~(Loss) Income. The ~~Company completed this cost savings phase as~~majority of ~~September 27, 2019.~~

~~On August 26, 2019, we announced that Eric J. Foss stepped down from his role as Chairman, President and Chief Executive Officer, effective as of August 25, 2019. We recognized $12.1 million of~~the charges ~~related to his separation from us, of which $10.4 million related to cash compensation. These amounts~~ are expected to be paid ~~through fiscal 2021.~~out within the next year.

We have undertaken many actions as it relates to our liquidity position in response to COVID-19. See "Liquidity and Capital Resources" below for additional disclosure around these actions taken. Also, see “Item 1A. Risk Factors” for an additional discussion of risks and potential risks of COVID-19 on our business, financial condition and results of operations.

Divestiture

On November 9, 2018, we completed the sale of our wholly-owned Healthcare Technologies ("HCT") business for $293.7 million in cash. The transaction resulted in a pretax gain of $156.3 million (tax effected gain of $139.2 million) in the audited Consolidated Statements of (Loss) Income for the fiscal year ended September 27, 2019. ~~We evaluated the business under the rules for discontinued operations and concluded it did not meet all of the criteria required.~~

Seasonality

Our revenue and operating results have varied from quarter to quarter as a result of different factors. Historically, within our FSS United States segment, there has been a lower level of activity during our first and second fiscal quarters in operations that provide services to sports and leisure clients. This lower level of activity, historically, has been partially offset during our first and second fiscal quarters by the increased activity levels in our educational operations. Conversely, historically there has been a significant increase in the provision of services to sports and leisure clients during our third and fourth fiscal quarters, which is partially offset by the effect of summer recess at colleges, universities and schools in our educational operations. As described above, during the COVID-19 pandemic, and in following periods, our business and results of operations have not and may continue to not experience our historically typical patterns of seasonality.

Sources of Revenue

Our clients engage us, generally through written contracts, to provide our services at their locations. Depending on the type of client and service, we are paid either by our client or directly by the consumer to whom we have been provided access by our client. We typically use either profit and loss contracts or client interest contracts in our FSS United States and FSS International segments. These contracts differ in their provision for the amount of financial risk we bear and, accordingly, the potential compensation, profits or fees we may receive. Under profit and loss contracts, we receive all of the revenue from, and bear all of the expenses of, the provision of our services at a client location. For fiscal ~~2019,~~2020, approximately two-thirds of our FSS United States and FSS International segment revenue was derived from profit and loss contracts. Client interest contracts include management fee contracts, under which our clients reimburse our operating costs and pay us a management fee, which may be calculated as a fixed dollar amount or a percentage of revenue or operating costs. Some management fee contracts entitle us to receive incentive fees based upon our performance under the contract, as measured by factors such as revenue, operating costs and customer satisfaction surveys. For fiscal ~~2019,~~2020, approximately one-third of our FSS United States and FSS International segment revenue was derived from client interest contracts. In response to the changed circumstances caused by COVID-19, we have partnered with clients to renegotiate or temporarily suspend certain terms and financial structures, particularly in profit and loss contracts, in order to mitigate lost revenues caused by partial or full closure of client premises.

For our Uniform segment, we typically serve our rental clients under written service contracts for an initial term of three to five years. As the majority of our clients purchase on a recurring basis, our backlog of orders at any given time consists principally of orders in the process of being filled. With the exception of certain governmental bid business, most of our direct marketing business is conducted under invoice arrangement with repeat clients. To a large degree, our direct marketing business is relationship-driven. While we have long-term relationships with our larger clients, we generally do not have contracts with these clients.

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Costs and Expenses

Our costs and expenses are comprised of cost of services provided, depreciation and amortization and selling and general corporate expenses. Cost of services provided consists of direct expenses associated with our operations, which includes food costs, wages, other labor-related expenses (including workers' compensation, severance, state unemployment insurance and federal or state mandated health benefits and other healthcare costs), insurance, fuel, utilities, piece goods and clothing and equipment. Depreciation and amortization expenses mainly relate to assets used in generating revenue. Selling and general corporate expenses include sales commissions, severance, share-based compensation and other unallocated costs related to administrative functions including finance, legal, human resources and information technology.

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Interest and Other Financing Costs, net

Interest and other financing costs, net, relates primarily to interest expense on long-term borrowings. Interest and other financing costs, net also includes third-party costs associated with long-term borrowings that were capitalized and are being amortized over the term of the borrowing.

(Benefit) Provision for Income Taxes

The (benefit) provision for income taxes represents federal, foreign, state and local income taxes. Our effective tax rate differs from the statutory U.S. income tax rate due to the effect of state and local income taxes, tax rates in foreign jurisdictions, tax credits and certain nondeductible expenses. Our effective tax rate will change from quarter to quarter based on recurring and nonrecurring factors including, but not limited to, the geographical mix of earnings, state and local income taxes, tax audit settlements, share-based award exercise activity and enacted tax legislation, including certain business tax credits. ~~Both~~The fiscal 2020 income tax benefit was impacted by the CARES Act, while both fiscal ~~2019~~2020 and fiscal ~~2018 income tax provisions~~2019 were impacted by U.S. tax reform enacted in the "Tax Cuts and Jobs Act" (see Note 910 to the audited consolidated financial statements). Changes in judgment due to the evaluation of new information resulting in the recognition, derecognition or remeasurement of a tax position taken in a prior annual period are recognized separately in the quarter of the change.

Foreign Currency Fluctuations

The impact from foreign currency translation assumes constant foreign currency exchange rates based on the rates in effect for the prior year period being used in translation for the comparable current year period. We believe that providing the impact of fluctuations in foreign currency rates on certain financial results can facilitate analysis of period-to-period comparisons of business performance.

Fiscal Year

Our fiscal year is the fifty-two or fifty-three week period which ends on the Friday nearest to September 30th. The fiscal ~~years~~year ended October 2, 2020 was a fifty-three week period and the fiscal year ended September 27, 2019 ~~and September 28, 2018 are both~~was a fifty-two week ~~periods.~~

period.

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Results of Operations

Fiscal ~~2019~~2020 Compared to Fiscal ~~2018~~2019

The following tables present an overview of our results on a consolidated and segment basis with the amount of and percentage change between periods for the fiscal years ~~2019~~2020 and ~~2018~~2019 (dollars in millions).


	Fiscal Year Ended
	October 2, 2020		September 27, 2019		$		%
Revenue	$	12,829.6	$	16,227.3	$	(3,397.7)	(20.9)	%
Costs and Expenses:
Cost of services provided	11,993.7		14,532.7		(2,539.0)		(17.5)	%
Other operating expenses	902.2		959.7		(57.5)		(6.0)	%
Goodwill impairment	198.6		—		198.6		100.0	%
Gain on sale of Healthcare Technologies	—		(156.3)		156.3		(100.0)	%
	13,094.5		15,336.1		(2,241.6)		(14.6)	%
Operating (loss) income	(264.9)		891.2		(1,156.1)		(129.7)	%
Interest and Other Financing Costs, net	382.8		335.0		47.8		14.3	%
(Loss) Income Before Income Taxes	(647.7)		556.2		(1,203.9)		(216.5)	%
(Benefit) Provision for Income Taxes	(186.3)		107.7		(294.0)		(273.0)	%
Net (loss) income	$	(461.4)	$	448.5	$	(909.9)	(202.9)	%

Fiscal Year Ended
September 27, 2019 September 28, 2018 $ %
Revenue $ 16,227.3
$ 15,789.6
$ 437.7
3 %
Costs and Expenses:
Cost of services provided 14,532.7
13,997.9
534.8
4 %
Other operating expenses 959.7
973.3
(13.6 ) (1 )%
Gain on sale of Healthcare Technologies (156.3 ) —
(156.3 ) — %
15,336.1
14,971.2
364.9
2 %
Operating income 891.2
818.4
72.8
9 %
Interest and Other Financing Costs, net 335.0
346.6
(11.6 ) (3 )%
Income Before Income Taxes 556.2
471.8
84.4
18 %
Provision (Benefit) for Income Taxes 107.7
(96.6 ) 204.3
(212 )%
Net income $ 448.5
$ 568.4
$ (119.9 ) (21 )%


	Fiscal Year Ended
Revenue by Segment(1)	October 2, 2020		September 27, 2019		$		%
FSS United States	$	7,366.7	$	9,898.6	$	(2,531.9)	(25.6	%)
FSS International	2,945.8		3,742.9		(797.1)		(21.3	%)
Uniform	2,517.1		2,585.8		(68.7)		(2.7	%)
	$	12,829.6	$	16,227.3	$	(3,397.7)	(20.9	%)

	Fiscal Year Ended
Operating Income (Loss) by Segment(1)	October 2, 2020		September 27, 2019		$		%
FSS United States	$	5.3	$	716.8	$	(711.5)	(99.3	%)
FSS International	(344.2)		142.7		(486.9)		***
Uniform	171.5		191.3		(19.8)		(10.4	%)
Corporate	(97.5)		(159.6)		62.1		(38.9	%)
	$	(264.9)	$	891.2	$	(1,156.1)	(129.7	%)

Fiscal Year Ended
Revenue by Segment⁽¹⁾
September 27, 2019 September 28, 2018 $ %
FSS United States $ 9,898.6
$ 10,137.8
$ (239.2 ) (2 %)
FSS International 3,742.9
3,655.8
87.1
2 %
Uniform 2,585.8
1,996.0
589.8
30 %
$ 16,227.3
$ 15,789.6
$ 437.7
3 %

Fiscal Year Ended
Operating Income by Segment⁽¹⁾
September 27, 2019 September 28, 2018 $ %
FSS United States $ 716.8
$ 682.7
$ 34.1
5 %
FSS International 142.7
142.2
0.5
— %
Uniform 191.3
181.4
9.9
5 %
Corporate (159.6 ) (187.9 ) 28.3
(15 %)
$ 891.2
$ 818.4
$ 72.8
9 %
*** Not meaningful

⁽¹⁾ As a percentage of total revenue, FSS United States represented ~~61%~~57.4% and ~~64%~~61.0%, FSS International represented ~~23%~~23.0% and ~~23%~~23.1% and Uniform represented ~~16%~~19.6% and ~~13%~~15.9% for fiscal ~~2019~~2020 and fiscal ~~2018,~~2019, respectively. ~~The fiscal 2019 percentages were impacted by the adoption of Accounting Standards Codification ("ASC") 606 (see Note 7 to the audited consolidated financial statements).~~ Revenue and operating income (loss) for all segments were impacted by COVID-19 in fiscal 2019 for the FSS United States segment were also impacted by the sale of HCT in the first quarter of fiscal 2019 (see Note 2 to the audited consolidated financial statements). Fiscal 2018 operating income was impacted by the adoption of ASU 2017-07, ~~Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost~~ ~~(see Note 1 to the audited consolidated financial statements).~~2020.

Consolidated Overview

Revenue ~~increased~~decreased by approximately 3%20.9% during fiscal ~~2019~~2020 compared to the prior year ~~period.~~period, which was mainly due to COVID-19, primarily from our clients either reducing or ceasing operations at certain locations across all of our segments. Foreign currency translation also negatively impacted fiscal 2020 (approximately 0.8%). The ~~increase~~decrease in revenue was ~~attributable to:~~

~~growth in our FSS International segment (approximately 2%) and our Uniform segment (approximately 1%);~~

~~growth in~~partially offset by the ~~Sports, Leisure & Corrections sector in our FSS United States segment (approximately 1%);~~

~~the adoption~~estimated impact of the ~~new revenue recognition standard mainly from certain fees previously recognized as a reduction to “Cost of services provided,” that are now recognized~~53rd week in ~~“Revenue" in our Uniform segment~~fiscal 2020 (approximately ~~2%); and~~

~~growth due to the Avendra and AmeriPride acquisitions (approximately 1%); which more than offset~~

~~the effect of the divestiture of HCT (approximately -2%); and~~

~~the negative impact of foreign currency translation (approximately -2%~~1.1%).

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The following table presents the cost of services provided by segment and as a percent of revenue for the fiscal years ended October 2, 2020 and September 27, ~~2019~~2019.


	Fiscal Year Ended
	October 2, 2020				September 27, 2019
Cost of services provided(1)	$		% of Revenue		$		% of Revenue
FSS United States	$	6,889.4	93.5	%	$	8,851.5	89.4	%
FSS International	2,998.4		101.8	%	3,517.1		94.0	%
Uniform	2,105.9		83.7	%	2,164.1		83.7	%
	$	11,993.7	93.5	%	$	14,532.7	89.6	%

(1) During fiscal 2020, Cost of services provided included severance charges related to COVID-19. The severance charges by segment are the following: FSS United States ($51.8 million), FSS International ($87.3 million) and ~~September 28, 2018.~~

Fiscal Year Ended
September 27, 2019 September 28, 2018
Cost of services provided $ % of Revenue $ % of Revenue
FSS United States $ 8,851.5
89 % $ 8,956.9
88 %
FSS International 3,517.1
94 % 3,428.8
94 %
Uniform 2,164.1
84 % 1,612.2
81 %
$ 14,532.7
90 % $ 13,997.9
89 %
Uniform ($4.9 million).

The following table presents the percentages attributable to the components in cost of services provided for fiscal ~~2019~~2020 and fiscal ~~2018.~~2019.


	Fiscal Year Ended
Cost of services provided components	October 2, 2020		September 27, 2019
Food and support service costs	25.7	%	27.9	%
Personnel costs(1)	49.3	%	46.8	%
Other direct costs	25.0	%	25.3	%
	100.0	%	100.0	%

Fiscal Year Ended
Cost of services provided components September 27, 2019 September 28, 2018
Food and support service costs 28 % 26 %
Personnel costs 47 % 47 %
Other direct costs 25 % 27 %
100 % 100 %
(1) Severance charges related to COVID-19 increased this percentage by 1.2% during fiscal 2020.

Operating income ~~increased~~decreased by approximately ~~$72.8~~$1,156.1 million during fiscal ~~2019~~2020 compared to the prior year period. Operating income was negatively impacted during fiscal 2020 due to COVID-19, primarily attributable to clients either reducing or ceasing operations at certain locations across all of our segments. The ~~increase~~negative impact of COVID-19 was partially offset by both U.S. and non-U.S. governmental labor related tax credits (see Note 1 to the audited consolidated financial statements). COVID-19 also led to lower personnel costs and share-based compensation expense (see Note 12 to the audited consolidated financial statements). Personnel costs include employee incentive expenses related to the annual bonus and employer retirement matching contributions. The decrease in operating income during fiscal 2020 was also attributable to:

a•non-cash goodwill impairment charge in the FSS International segment (approximately $198.6 million) (see Note 4 to the audited consolidated financial statements);

•the prior year gain from the divestiture of the HCT business (approximately $156.3 million);

~~an increase in profit~~•severance charges related to COVID-19 (approximately $145.8 million);

•non-cash charges related to operating lease right-of-use ("ROU") assets, property and equipment and other assets in the ~~acquisitions of Avendra~~FSS United States and ~~AmeriPride and lower merger and integration costs (approximately $41.1 million);~~

~~a decrease in share-based compensation expense~~FSS International segments, primarily related to ~~an increase~~client contracts that were reassessed due to the impact of COVID-19 (approximately $30.6 million);

•non-cash charges related to operating lease ROU assets, property and equipment and other assets from disposal by abandonment of certain rental properties in the ~~prior year actual and expected attainment percentages~~FSS United States segment (approximately $28.5 million);

•non-cash charges related to ~~the fiscal 2016 and fiscal 2017 Performance Stock Unit ("PSU") grants, respectively, and a decrease~~information technology assets in the ~~actual~~FSS United States segment due to discontinued use and ~~expected attainment percentages in the current year related to the fiscal 2017~~non-renewal or expiration of contracts with specific vendors (approximately $26.1 million); and ~~fiscal 2018 PSU grants, respectively, (approximately $33.0 million);~~

~~lower severance~~•personnel and consulting costs related to ~~streamlining~~sales growth initiatives (approximately ~~$22.2~~$25.8 million);.

~~an increase~~These decreases in ~~profit in the Sports, Leisure and Corrections sector in our FSS United States segment, including~~operating income ~~relating to the recovery of our investment (possessory interest) at one of the National Park Service ("NPS") sites (approximately $16.2 million); partially offset by~~during fiscal 2020 more than offset:

~~higher personnel costs, including employee incentive expenses related to the annual bonus (approximately $87.6 million) and employer retirement matching contributions (approximately $12.4 million) and~~•prior year compensation expenses for employee reinvestments funded by benefits from U.S. tax reform (approximately ~~$74.9~~$73.5 million);

~~profit decline in the Business & Industry sector and from the divestiture of HCT (approximately $30.2 million);~~

•prior year charges related to certain legal settlements (approximately ~~$27.9~~$29.5 million);

~~non cash~~•a gain from the insurance proceeds received related to property damage from a tornado in Nashville in the Uniform segment (approximately $16.3 million);

•the positive impact of foreign currency translation (approximately $15.3 million);

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•lower severance costs related to streamlining initiatives (approximately $15.0 million);

•prior year non-cash impairment charges related to various assets (approximately $14.8 million);

•prior year cash compensation charges related to the retirement of our former chief executive officer (approximately $10.4 million);

~~closing costs mainly related to customer contracts within our FSS International segment (approximately $10.3 million); and~~

•prior year advisory, legal and other professional fees related to the Mantle Ridge Group (approximately $7.7 million); and

•lower merger and integration charges from the Avendra and AmeriPride acquisitions (approximately $7.2 million).

Interest and Other Financing Costs, net, ~~decreased 3%~~increased 14.3% during fiscal ~~2019~~2020 compared to the prior year period. The ~~decrease~~increase for fiscal ~~2019~~2020 was primarily due to ~~lower refinancing activity expenses compared to fiscal 2018~~the issuance of ~~$15.6~~$1,500.0 million ~~and an increase in favorable returns~~of 6.375% Senior Notes, due 2025, the additional borrowings on ~~our interest rate swaps of $11.7 million, partially offset by higher borrowings from~~ the ~~financing in fiscal 2018 for the Avendra and AmeriPride acquisitions.~~

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The effective income tax rate for fiscal 2019 was 19.4% compared to (20.5)% in the prior year. The increase in the effective tax rate in fiscal 2019 was driven by prior year one-time benefits resulting from a reduction in the U.S. federal statutory rate from 35% to 21% and the re-measurement of our deferred tax assets and liabilities as a result of the “Tax Cuts and Jobs Act." A non cash benefit of approximately $237.8 million was recorded to the provision (benefit) for income taxes for fiscal 2018 in the Consolidated Statements of Income as a result of U.S. tax reform, the impact of certain permanently reinvested foreign earnings and certain other tax adjustments. The effective tax rate for fiscal 2019 also includes a tax benefit of approximately $10.4 million, mainly as a result of U.S. tax reformrevolving credit facility (see Note 95 to the audited consolidated financial statements) and ~~a $17~~the estimated impact of the 53rd week in fiscal 2020 of approximately $7.3 million, ~~tax provision~~partially offset by lower outstanding term loan borrowings resulting from optional prepayments made during fiscal 2019. Fiscal 2020 includes $20.9 million of net expense related to the ~~sale~~refinancing of ~~HCT~~new term loan borrowings to repay the 5.125% Senior Notes due 2024.

The income tax benefit for fiscal 2020 was recorded at an effective rate of 28.8% compared to income tax expense recorded at an effective rate of 19.4% in the prior year. As a result of the CARES Act, we recorded a net income tax benefit of approximately $58.4 million during fiscal 2020. This benefit reflects the Net Operating Losses ("NOLs") expected to be carried back to Pre-Tax Cut and Jobs Act years, which are benefited at 35.0% as opposed to the current year rate of 21.0%. The effective tax rate for fiscal 2020 also includes an income tax benefit of approximately $46.2 million as a result of an excess tax benefit recognized in relation to equity awards exercised during the fiscal year, including by the former Chairman, President and Chief Executive Officer. We also recorded a valuation allowance against deferred tax assets for cumulative losses in certain subsidiaries of approximately $21.4 million during fiscal 2020, of which $8.6 million was tied to negative evidence related to the $198.6 million non-cash goodwill impairment recorded in the FSS International segment (see Note 24 to the audited consolidated financial statements). The non-cash impairment charge of goodwill for $198.6 million was non-deductible for income tax purposes.

Segment Results

FSS United States Segment

The FSS United States reportable segment consists of five sectors which have similar economic characteristics and are aggregated into a single operating segment. The five sectors of the FSS United States reportable segment are Business & Industry, Education, Healthcare, Sports, Leisure & Corrections and Facilities & Other.

Revenue for each of these sectors is summarized as follows (in millions):


	Fiscal Year Ended				Change			Fiscal Year Ended				Change
	September 27, 2019		September 28, 2018		%			October 2, 2020		September 27, 2019		%
Business & Industry	$	1,587.0	$	1,550.6	2	%	Business & Industry	$	1,097.3	$	1,587.0	(30.9)	%
Education	3,228.8		3,239.6		—	%	Education	2,416.4		3,228.8		(25.2)	%
Healthcare	933.5		1,292.1		(28	)%	Healthcare	824.6		933.5		(11.7)	%
Sports, Leisure & Corrections	2,557.5		2,445.1		5	%	Sports, Leisure & Corrections	1,535.8		2,557.5		(39.9)	%
Facilities & Other	1,591.8		1,610.4		(1	)%	Facilities & Other	1,492.6		1,591.8		(6.2)	%
	$	9,898.6	$	10,137.8	(2	)%		$	7,366.7	$	9,898.6	(25.6)	%

The Healthcare sector had high-single digit operating income margins, consistent with prior year. The Education and Facilities & Other sectors ~~generally have high-single~~had mid-single digit operating income margins, ~~and~~compared to high-single digits in the prior year. The Business & Industry ~~and~~sector had negative mid-single digit operating income margins, compared to mid-single digits in the prior year. The Sports, Leisure & Corrections ~~sectors generally have mid-single~~sector had negative low-single digit operating income ~~margins.~~margins, compared to mid-single digits in the prior year. As described above, during the COVID-19 pandemic, and in following periods, operating income margins in the FSS United States sectors differ from our historically typical patterns.

FSS United States segment revenue decreased by approximately 2%25.6% during fiscal ~~2019~~2020 compared to the prior year period. The decrease was primarily attributable ~~to:~~

~~a decrease~~to COVID-19, which significantly impacted our Sports, Leisure & Corrections sector due to the suspension of professional sports seasons, our Education sector where clients either have reduced or ceased operations at certain locations and our Business & Industry sector due to many clients working from home instead of the office. During fiscal 2020, revenue also decreased in the Healthcare sector ~~revenue~~ resulting from the divestiture of HCT (approximately ~~-29%~~ 4.3%

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of the Healthcare sector)~~; and~~

a. The decrease in ~~Facilities & Other sector~~ revenue ~~resulting from a decline~~was partially offset by the estimated impact of the 53rd week in ~~base business within our facilities business; which more than offset~~

~~an increase in Sports, Leisure & Corrections sector revenue resulting from new business and base business growth in stadiums and arenas; and~~

~~an increase in Business & Industry sector revenue resulting from new business and base business growth.~~fiscal 2020 (approximately 1.2%).

Operating income ~~increased~~decreased by approximately ~~$34.1~~$711.5 million during fiscal ~~2019~~2020 compared to the prior year period. ~~The increase in operating~~Operating income was negatively impacted during fiscal 2020 due to COVID-19, partially offset by labor related tax credits from the CARES Act legislation and lower personnel costs, including lower employee incentive expenses related to the annual bonus and lower employer retirement matching contributions. The profit decline from COVID-19 is primarily attributable to clients either reducing or ceasing operations at certain locations. The decrease during fiscal 2020 was also attributable to:

a•the prior year gain from the divestiture of the HCT business (approximately $156.3 million);

an increase in profit in the Sports, Leisure and Corrections sector, including income relating to the recovery of our investment (possessory interest) at one of the NPS sites (approximately $16.2 million);

~~lower~~ •severance charges related to ~~streamlining~~COVID-19 (approximately $51.8 million);

•non-cash charges related to operating lease ROU assets, property and equipment and other assets from disposal by abandonment of certain rental properties (approximately $28.5 million);

•non-cash charges related to information technology assets due to discontinued use and non-renewal or expiration of contracts with specific vendors (approximately $26.1 million);

•non-cash charges related to operating lease ROU assets, property and equipment and other assets, primarily related to client contracts that were reassessed due to the impact of COVID-19 (approximately $19.4 million); and

•personnel costs and consulting costs related to sales growth initiatives (approximately ~~$9.3~~$13.7 million)~~; and~~.

~~an increase~~These decreases in ~~profit related to the acquisition of Avendra and lower merger and integration costs (approximately $7.9 million); which~~operating income during fiscal 2020 more than ~~offset~~offset:

~~higher personnel costs, including employee incentive expenses related to the annual bonus (approximately $45.0 million) and employer retirement matching contributions (approximately $7.8 million) and~~•prior compensation expenses for employee reinvestments funded by benefits from U.S. tax reform (approximately ~~$58.7~~$57.2 million);

~~profit decline in the Business & Industry sector and from the divestiture of HCT (approximately $30.2 million);~~

•prior year charges related to certain legal settlements ~~(approximately $11.1~~($12.7 million); ~~and~~

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~~non cash~~prior year non-cash impairment charges related to various assets ($11.1 million).;

~~Revenue~~•prior year duplicate rent charges to build out and ~~operating income were both negatively impacted during fiscal 2018 by natural disasters, specifically~~ready our new headquarters while occupying our previous headquarters, impairment costs while exiting our previous headquarters and moving costs associated with the ~~wildfires at Yosemite National Park. The impact~~relocation to the ~~FSS United States segment was an approximate $28 million decline in revenue~~new headquarters (approximately $6.5 million); and ~~an approximate $9 million decline in operating income, which includes $5 million of recoveries under our insurance program.~~

•prior year settlement charges related to exiting a joint venture arrangement (approximately $4.5 million).

FSS International Segment

FSS International segment revenue ~~increased~~decreased by approximately 2%21.3% during fiscal ~~2019~~2020 compared to the prior year period. The ~~increase~~decrease was attributable ~~to:~~

~~revenue growth across all regions; partially offset by~~

to the negative impact of ~~foreign~~COVID-19 from government imposed shutdowns. Foreign currency translation also negatively impacted fiscal 2020 revenue (approximately 7%3.5%).

~~During fiscal 2019, the consolidation of a joint venture contributed approximately 1% revenue growth.~~

Operating income ~~increased~~decreased by approximately ~~$0.5~~$486.9 million during fiscal ~~2019~~2020 compared to the prior year period. The ~~increase in operating income~~decrease was attributable to the negative impact of COVID-19, partially offset by labor related tax credits provided from government assistance programs and lower personnel costs, including lower employee incentive expenses related to the annual bonus. The decrease was also attributable to:

~~profit growth in Germany, Canada, China, South America and our 50% joint venture ownership in AIM Services Co. Ltd. in Japan;~~•a non-cash goodwill impairment charge (approximately $198.6 million) (see Note 4 to the audited consolidated financial statements);

~~prior year~~ •severance charges related to COVID-19 (approximately $87.3 million);

•charges related to a ~~joint venture partner liquidation and related acquisition~~client contract dispute (approximately ~~$7.5~~$15.2 million); and

•non-cash charges related to property and equipment from client contracts that were reassessed due to the impact of COVID-19 (approximately $11.2 million).

These decreases in operating income during fiscal 2020 more than offset:

•the positive impact of foreign currency translation (approximately $15.2 million);

•lower severance ~~costs~~charges related to streamlining initiatives (approximately ~~$4.3~~$13.4 million); and

•lower closing costs mainly related to customer contracts (approximately $9.5 million).

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Uniform Segment

Uniform segment revenue decreased by approximately 2.7% during fiscal 2020 compared to the prior year period. The decrease was primarily attributable to COVID-19, partially offset by new business from the sale of PPE and the estimated impact of the 53rd week in fiscal 2020 (approximately 1.7%).

~~higher~~Operating income decreased by approximately $19.8 million during fiscal 2020 compared to the prior year period. The decrease was attributable to the negative impact of COVID-19, partially offset by labor related tax credits provided by government assistance programs and lower personnel costs, including lower employee incentive expenses related to the annual bonus ~~(approximately $24.4 million);~~and lower employer matching contributions. The decrease was also attributable to:

~~closing~~•personnel costs ~~mainly~~ related to ~~customer contracts~~sales growth initiatives (approximately ~~$10.3~~$12.1 million); and

~~the negative impact of foreign currency translation~~•severance charges related to COVID-19 (approximately ~~$3.4~~$4.9 million).

~~Uniform Segment~~

Uniform segment revenue increased by approximately 30% during fiscal 2019 compared to the prior year period. The increase was primarily from the adoption of the new revenue recognition standard mainly from certain fees previously recognized as a reduction to “Cost of services provided” that are now recognized in “Revenue” (approximately 19%) and growth within our uniform rental business. The acquisition of AmeriPride contributed approximately 8% to revenue growth in fiscal 2019.

~~Operating income increased by approximately $9.9 million during fiscal 2019 compared to the prior year period. The increase~~These decreases in operating income ~~was attributable to:~~during fiscal 2020 more than offset:

~~profit growth~~•a gain from the insurance proceeds received related to ~~the acquisition of AmeriPride and our legacy uniform rental business;~~property damage from a tornado in Nashville (approximately $16.3 million);

•lower ~~merger and integration related costs from the AmeriPride acquisition (approximately $8.0 million); and~~

~~a prior year environmental reserve related to a reassessment of the monitoring period of respective sites (approximately $5.0 million); which more than offset~~

~~higher personnel costs, including employee incentive expenses related to the annual bonus ($13.6 million) and employer retirement matching contributions (approximately $4.7 million) and~~compensation expenses for employee reinvestments funded by benefits from U.S. tax reform (approximately ~~$14.4~~$14.5 million);

•a favorable non-cash settlement of a multiemployer pension plan obligation (approximately $6.7 million);

•prior year charges related to certain legal settlements (approximately $5.1 million);

~~non cash~~•lower merger and integration charges from the AmeriPride acquisition (approximately $5.0 million); and

•prior year non-cash impairment charges (approximately $3.7 million)~~; and~~

~~income received in fiscal 2018 as a result of favorable loss experience in older insurance years under our casualty insurance program (approximately $3.4 million)~~.

Corporate

Corporate expenses, those administrative expenses not allocated to the business segments, decreased by approximately ~~$28.3~~$62.1 million during fiscal ~~2019~~2020 compared to the prior year ~~period.~~period, due to lower expenses resulting from the impact of COVID-19, consisting of lower employee incentive expenses related to the annual bonus and lower employer retirement matching contributions, and realignment actions taken by management. The decrease was also attributable to:

~~a decrease in~~•lower share-based compensation expense ~~primarily related to an increase~~as a result of COVID-19 from the reduction in the estimated target attainment on plan metrics for fiscal 2018, fiscal 2019 and fiscal 2020 Performance Stock Unit ("PSU") grants (approximately $24.9 million);

•prior year ~~actual and expected attainment percentages related to the fiscal 2016 and fiscal 2017 PSU grants, respectively, and a decrease in the actual~~

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~~and expected attainment percentages in the current year related to the fiscal 2017 and fiscal 2018 PSU grants, respectively, (approximately $33.0 million);~~

~~lower acquisition related costs from the Avendra and AmeriPride acquisitions (approximately $25.3 million); and~~

~~lower consulting costs (approximately $5.8 million); partially offset by~~

charges related to certain legal settlements (approximately $11.7 million);

•prior year cash compensation charges related to the retirement of our former chief executive officer (approximately $10.4 million);

•prior year advisory, legal and other professional fees related to the Mantle Ridge Group (approximately $7.7 million);

•prior year banker fees related to the divestiture of HCT (approximately $6.1 million);

~~higher personnel costs, including employee incentive expenses related to~~ •the ~~annual bonus~~favorable change in fair value of certain gasoline and diesel agreements (approximately ~~$4.6~~$4.2 million); and

•prior year compensation expenses for employee reinvestments funded by benefits from U.S. tax reform (approximately $1.4 million)~~; and~~.

~~the change~~These decreases in ~~fair value of certain gasoline and diesel agreements (a loss of approximately $5.0~~corporate expenses during fiscal 2020 more than offset severance charges related to COVID-19 (approximately $1.8 million).

Liquidity and Capital Resources

Overview

Our principal sources of liquidity are cash generated from operating activities, funds from borrowings and existing cash on hand. As of ~~September 27, 2019,~~October 2, 2020, we had ~~$246.6~~$2,509.2 million of cash and cash equivalents and approximately ~~$897.8~~$80.1 million of availability under our senior secured revolving credit facility. A significant portion of our cash and cash equivalents isare held in mature, liquid geographies where we have operations. As of ~~September 27, 2019,~~October 2, 2020, there ~~was~~were approximately ~~$881.9~~$937.4 million of outstanding foreign currency borrowings.

~~We believe that~~On January 15, 2020, we entered into a new U.S. dollar denominated term loan due January 15, 2027 (the "U.S. Term Loan B due 2027"), in an aggregate principal amount of $900.0 million. The U.S. Term Loan B due 2027 was borrowed with an

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original issue discount of 0.125%. The net proceeds from the U.S. Term Loan B due 2027 were used to redeem the aggregate $900.0 million principal amount outstanding on the 5.125% Senior Notes due 2024 (the "2024 Notes") at a redemption price of 102.563% of the aggregate principal amount and to pay accrued interest, certain fees and related expenses, including a $23.1 million call premium on the 2024 Notes and approximately $6.6 million related to banker fees, rating agency fees and legal fees (see Note 5 to the audited consolidated financial statements).

In response to the COVID-19 pandemic, we undertook a number of actions to enhance our cash ~~generated~~position, including increasing borrowings under our revolving credit facility and under our Receivables Facility. In addition, on April 27, 2020, Aramark Services Inc. (“ASI”), our indirect wholly owned subsidiary, issued $1,500.0 million aggregate principal amount of 6.375% Senior Notes due May 1, 2025 (the "6.375% 2025 Notes"). ASI has used and intends to continue to use the net proceeds from ~~operations,~~the 6.375% 2025 Notes for general corporate purposes (see Note 5 to the audited consolidated financial statements). On October 30, 2020, we repaid $680.0 million of the outstanding borrowings under the revolving credit facility utilizing cash and cash equivalents and ~~the unused portion~~as of ~~our committed credit~~such date had approximately $753.9 million of availability under the ~~senior secured~~revolving credit facility. We have also implemented several cost reduction initiatives in response to COVID-19, including renegotiations of client contracts, salary and other compensation adjustments and reductions to general corporate expenses. Beginning in the third quarter of fiscal 2020, we made changes to our organization to align our cost base to better support our clients' needs as we navigate the current environment and focus on our long-term strategy. These actions included headcount reductions, which resulted in severance charges of approximately $145.8 million during fiscal 2020. The majority of these charges are expected to be paid out within the next year.

While the full impact of COVID-19 on our long-term liquidity remains uncertain, we currently believe that our cash and cash equivalents, including funds from the 6.375% 2025 Notes and availability under our revolving credit facility, will be adequate to meet anticipated cash requirements to fund working capital, capital spending, debt service obligations, refinancings, dividends and other cash needs. ~~As part of our ongoing liquidity assessments, we routinely monitor our cash flow (including~~We have no significant debt maturities due until 2023 and, with the ~~mix of domestic and international inflows and outflows)~~additional funds from the 6.375% 2025 Notes and the ~~condition~~covenant relief attained as a result of the credit agreement amendment implemented in April 2020 (see Note 5 to the audited consolidated financial statements), we believe we have sufficient flexibility to manage the impact of COVID-19, based on our current assumptions. We also have flexibility to optimize working capital ~~markets in order~~and defer certain capital expenditures as appropriate without a material impact to the business. We believe that our assumptions used to estimate our liquidity and working capital requirements are reasonable; however, due to the unprecedented current environment, we cannot assure that our assumptions will be correct and, as a consequence, our ability to be ~~prepared to respond to changing conditions.~~predictive is uncertain. For information regarding the impact of COVID-19, including on our liquidity and capital resources, see Part I, Item 1A, "Risk Factors."

On February 5, 2019, we announced as a result of tax savings from U.S. tax reform that we would invest $90 million in our workforce through targeted wage adjustments, retirement contributions and special recognition awards, as well as employee training programs and scholarships. We funded a majority of these investments during fiscal 2019 ~~of which $62.5~~and through fiscal 2020, we invested approximately $85 million ~~was paid~~ in special recognition awards, ~~and~~ employee training ~~programs. We have $12.4 million of accrued~~programs, retirement contributions ~~in the audited Consolidated Balance Sheets as~~and educational assistance, and our investment of ~~September 27, 2019, which are expected to be paid during the first quarter of fiscal 2020. We expect to spend approximately $10 million during fiscal 2020 related to the investment~~such funds in our ~~workforce.~~workforce is now complete.

The table below summarizes our cash activity (in millions):


	Fiscal Year Ended							Fiscal Year Ended
	September 27, 2019			September 28, 2018				October 2, 2020		September 27, 2019
Net cash provided by operating activities	$	984.2		$	1,051.9		Net cash provided by operating activities	$	176.7	$	984.2
Net cash used in investing activities	(209.5		)	(2,865.3		)	Net cash used in investing activities	(361.1)		(209.5)
Net cash provided by (used in) financing activities	(734.9		)	1,794.2			Net cash provided by (used in) financing activities	2,437.5		(734.9)

Reference to the audited Consolidated Statements of Cash Flows will facilitate understanding of the discussion that follows.

Cash Flows Provided by Operating Activities

Cash provided by operating activities decreased by approximately $807.5 million during fiscal 2020 compared to fiscal 2019, primarily driven by a $683.9 million decline in net income and other non-cash charges and a $280.0 million decline in operating assets and liabilities. During fiscal ~~2019,~~2020, as discussed in "Results of Operations" above, net income decreased and ~~non cash~~non-cash charges ~~decreased during fiscal 2019~~increased compared to fiscal ~~2018. Fiscal~~ 2019, which was impacted by the current year net loss from COVID-19, offset by the current year non-cash goodwill impairment and asset write-downs of approximately $283.7 million and the prior year gain from the divestiture of the HCT business of approximately $139.2 million. The $280.0 million partially offset by $74.9 million of employee reinvestments from U.S. tax reform. Fiscal 2018 includes the non cash benefit of approximately $237.8 million recorded to the provision (benefit) to income taxes. The decrease in cash flows provided by operating activities was partially offset by the favorable change in operating assets and liabilities ($173.2 million). The changedecline in operating assets and liabilities compared to the prior year period was primarily due to the following:

~~Accrued expenses were~~

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•Change in Accounts payable was a use of cash by ($359.7 million) in fiscal 2020 compared to a source of cash in fiscal 2019 due to the timing of disbursements and lower purchasing levels from the impact of COVID-19, mainly in our Sports and Higher Education businesses, our Business & Industry sector and our FSS International segment;

•Change in Accrued expenses was a use of cash by ($337.2 million) in fiscal 2020 compared to a source of cash in fiscal 2019 primarily due to the following: change in annual bonus accrual generating more of a use of cash in the current year compared to the prior year period; commission payments in our Sports business and other accrued expense payments being higher in the current year compared to the prior year due to lower current year activity from the impact of COVID-19; lower client advances received in the current year compared to the prior year period within the Higher Education business as a result of COVID-19; the annual employer retirement matching contribution payments being higher in the current year compared to the prior year period; litigation settlement payment for employee annual incentive bonuses related to 2018 fiscal year; and timing of interest and insurance payments; partially offset by higher payroll and benefit related expenses from the severance charges recorded in fiscal 2020; and

•Change in Prepayments was a greater use of cash ($48.6 million) in fiscal 2020 compared to fiscal 2019 due to being in an income tax receivable position from the current year net loss; which more than offset

•Change in Receivables was a source of cash by $441.5 million in fiscal 2020 compared to a use of cash in fiscal ~~2018 primarily due to higher accruals related to the annual bonus, legal settlements and payroll and benefits and the timing of deferred income and~~

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~~one-time payments made during fiscal 2018 for certain liabilities assumed related to the Avendra and AmeriPride acquisitions, partially offset by the timing of insurance and interest payments;~~

~~Prepayments were a greater use of cash due to the timing of income tax payments; and~~

~~Accounts receivable were a greater use of cash~~2019 due to the timing of collections and ~~revenue growth.~~lower current year revenues from the impact of COVID-19.

Fiscal 2020 includes proceeds related to labor related tax credits from many foreign jurisdictions in which the Company operates as a form of relief from the COVID-19 pandemic (see Note 1 to the audited consolidated financial statements). During fiscal 2020 and fiscal 2019, we ~~paid approximately $62.5 million of special recognition awards and employee training costs funded by benefits from U.S. tax reform. The Company also~~ received income of approximately $15.5 million and $14.6 million, respectively, related to favorable loss experience in older insurance years under our ~~casualty insurance program. We received approximately $18.9 million~~general liability, automobile liability and workers' compensation programs. The "Change in other noncurrent liabilities" caption was a greater source of ~~comparable proceeds under our casualty insurance program~~cash during fiscal ~~2018. During fiscal 2018, we incurred~~2020 due to the deferral of approximately ~~$58.2~~$80.8 million ~~of acquisition related costs~~ related to ~~Avendra and AmeriPride. As a result~~the employer portion of social security taxes as permitted under the ~~adoption of~~CARES Act (see Note 1 to the new revenue recognition standard in the first quarter of fiscal 2019, certain payments made to our clients, previously included within "Purchases of property and equipment and other" in Cash Flows Used in Investing Activities, are now included within "Payments made to clients on contracts" in Cash Flows Provided by Operating Activities. These client payments were approximately $40.1 million during fiscal 2019.audited consolidated financial statements). The "Changes in other assets" caption was a ~~greater use~~source of cash during fiscal 2020 compared to a use of cash in fiscal 2019 mainly from lower in-service rental merchandise due to fewer customer installations from the impact of COVID-19, and from the change in our 50% ownership interest in AIM Services Co., Ltd., as ~~cash distributions received~~earnings were ~~higher during fiscal 2018 by $25.2 million.~~lower due to the impact of COVID-19. The "Other operating activities" caption ~~in both periods reflects~~reflects: adjustments to net (loss) income in the current year and prior year periods related to non-cash charges; and adjustments to non-operating cash gains and ~~losses.~~losses, including the call premium of $23.1 million from the repayment of the aggregate principal amount of the 2024 Notes and the gain from the insurance proceeds related to the property damaged from a tornado in Nashville of $16.3 million.

Cash Flows Used in Investing Activities

The ~~decrease~~change in net cash flows used in investing activities during fiscal ~~2019~~2020 compared to fiscal ~~2018~~2019 relates primarily to the proceeds from the sale of the HCT business in the first quarter of fiscal 2019 of $293.7 million and lower levels of capital ~~expenditures~~expenditures. The "Disposals of property and ~~lower spending for acquisitions for fiscal 2019 compared~~equipment" caption includes approximately $21.5 million of insurance proceeds related to ~~fiscal 2018, which included~~ the ~~Avendra and AmeriPride acquisitions.~~property damaged from a tornado at one of our Uniform locations in Nashville. The "Proceeds from governmental agencies related to property and equipment" caption includes approximately $15.3 million and $16.2 million of proceeds during fiscal 2020 and 2019, respectively, relating to the recovery of our investment (possessory interest) at one of the ~~NPS~~National Park Service sites within our Sports, Leisure & Corrections ~~sector~~sector. The "Proceeds from governmental agencies related to property and equipment" caption also includes approximately $8.3 million and $6.8 million during fiscal 2020 and fiscal 2019, respectively, of proceeds from government grants related to the relocation to our new ~~headquarters.~~headquarters in the prior year.

Cash Flows Provided by (Used In) Financing Activities

During fiscal 2020, cash provided by financing activities was impacted by the following:

•issuance of 6.375% senior unsecured notes due 2025 ($1,500.0 million);

•issuance of a new U.S. denominated term loan due January 2027, net of original issue discount ($898.9 million);

•an increase in borrowings under the revolving credit facility ($849.9 million);

•an increase in funding under the Receivables Facility ($315.6 million);

•an increase in proceeds from issuance of common stock as a result of higher stock option exercises ($90.0 million); and

•cash proceeds received from a stockholder in connection with short-swing profits earned through transactions in our common stock, which are included in "Other financing activities" ($14.8 million); which more than offset

•repayment of the aggregate principal amount of the 2024 Notes ($900.0 million); and

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•payment of fees and expenses related to refinancing activities, which is included in "Other financing activities," including a call premium ($23.1 million) and debt issuance costs ($29.4 million).

During fiscal 2019, cash used byin financing activities was impacted by $500.0 million of optional prepayments on term loans borrowings, of which $200.0 million was from the proceeds of the HCT divestiture.

During fiscal ~~2018, cash provided by financing activities was impacted by the following:~~

~~issuance of a new $1.785 billion U.S. Term Loan B due 2025;~~

~~issuance of $1.150 billion aggregate principal amount of 5.000% senior unsecured notes due 2028;~~

~~repayment of the U.S. dollar denominated term loan to Aramark Services, Inc. ("ASI") due 2022 ($633.8 million of principal);~~

~~repayment of borrowings on term loans ($302.6 million, which includes $260.4 million of optional prepayments);~~

~~decline in funding under the Receivables Facility ($254.2 million); and~~

~~payment of fees related to the U.S. Term Loan B due 2025 and the 5.000% senior unsecured notes due 2028 (approximately $24.7 million).~~

~~On August 6,~~ 2019, the Board of Directors authorized a new share repurchase program providing for purchases up to $200.0 million of Aramark common stock through July 2022. ~~We may utilize various methods to effect repurchases~~During the second quarter of fiscal 2020, we repurchased 0.3 million shares of our common stock for $6.5 million under this program. In accordance with Amendment No. 9 to the ~~repurchase program, which could include open market~~Credit Agreement entered into in the third quarter of fiscal 2020, we cannot make any future share repurchases privately negotiated transactions, block transactions, accelerated share repurchase or open market solicitations for shares, some of which may be effected through Rule 10b5-1 plans. Repurchases will be made based on ongoing assessments ofas long as the ~~capital needs of the business, the market price of our common stock and general market conditions. The program may be suspended or discontinued at any time.~~

~~During fiscal 2017, the Board of Directors authorized a share repurchase program providing for purchases of up to $250.0 million of Aramark common stock, which expired February 1, 2019.~~covenant compliance waiver remains in effect (see below). During fiscal 2019, we completed a repurchase of 1.6 million shares of our common stock for $50.0 million under ~~this program. During fiscal 2018, we completed~~ a previously authorized 2017 share repurchase ~~of 0.6 million shares of our common stock for $24.4 million.~~program, which expired on February 1, 2019.

The "Other financing activities" caption also reflects a use of cash during fiscal ~~2019~~2020 and fiscal ~~2018,~~2019, primarily related to taxes paid by us when we withhold shares upon an employee's exercise or vesting of equity awards to cover income taxes.

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may deem relevant. However, the payment of any future dividends will be at the discretion of our Board of Directors and our Board of Directors may, at any time, determine not to continue to declare quarterly dividends. In accordance with Amendment No. 9 to the Credit Agreement entered into in the third quarter of fiscal 2020, we have limitations on the amount of dividends allowed to be paid as long as the covenant compliance waiver remains in effect (see below).

Covenant Compliance

The Credit Agreement contains a number of covenants that, among other things, restrict, subject to certain exceptions, our ability and the ability of our subsidiaries to: incur additional indebtedness; issue preferred stock or provide guarantees; create liens on assets; engage in mergers or consolidations; sell assets; pay dividends, make distributions or repurchase our capital stock; make investments, loans or advances; repay or repurchase any subordinated debt, except as scheduled or at maturity; create restrictions on the payment of dividends or other amounts to us from our restricted subsidiaries; make certain acquisitions; engage in certain transactions with affiliates; amend material agreements governing our subordinated debt (or any indebtedness that refinances our subordinated debt); and fundamentally change our business. The indentures governing our senior notes contain similar provisions. As of ~~September 27, 2019,~~October 2, 2020, we were in compliance with these covenants.

As stated above, the Credit Agreement and the indentures governing our senior notes contain provisions that restrict our ability to pay dividends and repurchase stock (collectively, "Restricted Payments"). In addition to customary exceptions, the Credit Agreement and indentures permit Restricted Payments in the aggregate up to an amount that increases quarterly by 50% of our Consolidated Net Income, as such term is defined in these debt agreements, subject to being in compliance with the interest coverage ratio described below.

Under the Credit Agreement, we are required to satisfy and maintain specified financial ratios and other financial condition tests and covenants. The indentures governing our senior notes also require us to comply with certain financial ratios in order to take certain actions. Our continued ability to meet those financial ratios, tests and covenants can be affected by events beyond our control, and there can be no assurance that we will meet those ratios, tests and covenants.

On April 22, 2020, as a result of the impact of COVID-19 on our business, ASI entered into Amendment No. 9 to the Credit Agreement. Amendment No. 9 provides for a covenant waiver period which suspends the Consolidated Secured Debt Ratio covenant required under the credit agreement for four fiscal quarters, commencing with the fourth quarter of fiscal 2020 and ending after the third quarter of fiscal 2021, subject to, among other things, ongoing compliance with a minimum liquidity condition of $400.0 million and restrictions on making certain restricted payments (including share repurchases) and investments in unrestricted subsidiaries, in each case, as set forth in Amendment No. 9. If ASI ceases to be in compliance with Amendment No. 9 at any time during the covenant waiver period and is otherwise not in compliance with the Consolidated Secured Debt Ratio covenant required under the Credit Agreement, this will cause an event of default under the Credit Agreement. If such non-compliance is not waived, certain lenders under the senior secured credit facilities could elect to declare all amounts outstanding under the senior secured credit facilities to be immediately due and payable and terminate all commitments to extend further credit under such facilities. When the Consolidated Secured Debt Ratio covenant is once again effective for ASI in the fourth quarter of fiscal 2021, the trailing twelve month period will consist of results from the third quarter of fiscal 2019 through the first quarter of fiscal 2020 plus the fourth quarter of fiscal 2021, excluding the results of the second quarter of fiscal 2020 through the third quarter of fiscal 2021. This exclusion is intended to prevent the effects of COVID-19 from impacting the covenant calculation. Additionally under the covenant compliance waiver, in order to pay

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dividends of up to $29.0 million per quarter, we must maintain a minimum liquidity of $600.0 million at all times during such quarter. To the extent our liquidity falls below $600.0 million in any quarter, our dividend payments would be limited to $10.0 million for such quarter which would be substantially less than the amount of dividends we have historically paid.

These financial ratios, tests and covenants involve the calculation of certain measures that we refer to in this discussion as "Covenant Adjusted EBITDA." Covenant Adjusted EBITDA is not a measurement of financial performance under U.S. GAAP. Covenant Adjusted EBITDA is defined as net income (loss) of ~~ASI.~~ASI and its restricted subsidiaries plus interest and other financing costs, net, provision (benefit) for income taxes, and depreciation and amortization, further adjusted to give effect to adjustments required in calculating covenant ratios and compliance under our Credit Agreement and the indentures governing our senior notes.

Our presentation of these measures has limitations as an analytical tool, and should not be considered in isolation or as a substitute for analysis of our results as reported under U.S. GAAP. You should not consider these measures as alternatives to net income (loss) or operating income (loss) determined in accordance with U.S. GAAP. Covenant Adjusted EBITDA, as presented by us, may not be comparable to other similarly titled measures of other companies because not all companies use identical calculations.

The following is a reconciliation of net (loss) income attributable to ASI stockholder, which is a U.S. GAAP measure of ~~Aramark Services, Inc.~~ASI''s operating results, to Covenant Adjusted EBITDA as defined in our debt agreements. The terms and related calculations are defined in the Credit Agreement and the indentures governing our senior notes. Covenant Adjusted EBITDA is a measure of ASI and its restricted subsidiaries only and does not include the results of Aramark.


	Fiscal Year Ended
(in millions)	October 2, 2020		September 27, 2019
Net (loss) income attributable to ASI stockholder	$	(461.5)	$	448.5
Interest and other financing costs, net	382.8		335.0
(Benefit) Provision for income taxes	(186.3)		107.7
Depreciation and amortization	595.2		592.6
Share-based compensation expense(1)	30.3		55.3
Unusual or non-recurring (gains) and losses(2)	198.6		(156.3)
Pro forma EBITDA for equity method investees(3)	10.1		8.1
Pro forma EBITDA for certain transactions(4)	6.3		21.5
Other(5)	490.6		253.5
Covenant Adjusted EBITDA	$	1,066.1	$	1,665.9

Fiscal Year Ended
(in millions) September 27, 2019 September 28, 2018
Net income attributable to ASI stockholder $ 448.5
$ 567.9
Interest and other financing costs, net 335.0
346.5
Provision (Benefit) for income taxes 107.7
(96.6 )
Depreciation and amortization 592.6
596.2
Share-based compensation expense⁽¹⁾
55.3
88.3
Unusual or non-recurring (gains)/losses⁽²⁾
(156.3 ) —
Pro forma EBITDA for equity method investees⁽³⁾
8.1
15.2
Pro forma EBITDA for certain transactions⁽⁴⁾
21.5
58.6
Other⁽⁵⁾
253.5
151.7
Covenant Adjusted EBITDA $ 1,665.9
$ 1,727.8
(1)    Represents share-based compensation expense resulting from the application of accounting for stock options, restricted stock units, performance stock units and deferred stock unit awards (see Note 12 to the audited consolidated financial statements).

~~(1)~~

~~Represents share-based compensation expense resulting~~

(2) Represents the fiscal 2020 non-cash impairment charge related to goodwill (see Note 4 to the audited consolidated financial statements) and the fiscal 2019 gain from the divestiture of HCT (see Note 2 to the audited consolidated financial statements).

(3) Represents our estimated share of EBITDA, primarily from our AIM Services Co., Ltd. equity method investment, not already reflected in our Net (loss) income attributable to ASI stockholder. EBITDA for this equity method investee is calculated in a manner consistent with consolidated Covenant Adjusted EBITDA but does not represent cash distributions received from this investee.

(4) Represents the annualizing of net EBITDA from acquisitions and divestitures made during the period.

(5) "Other" for the twelve months ended October 2, 2020 and September 27, 2019, respectively, includes severance charges ($152.7 million and $18.7 million), non-cash impairment charges related to various assets ($30.6 million and $14.8 million), expenses related to merger and integration related charges ($28.9 million and $36.1 million), adjustments to remove the impact attributable to the adoption of certain accounting standards that are made to the calculation in accordance with the Credit Agreement and indentures ($23.1 million and $23.7 million), the impact of hyperinflation in Argentina ($2.5 million and $4.9 million), compensation expense for retirement contributions and employee training programs funded by benefits from U.S. tax reform ($1.4 million and $74.9 million), charges related to certain legal settlements ($1.0 million net expense reduction and $27.9 million), the loss from the change in fair value related to certain gasoline and diesel agreements ($0.5 million and $4.7 million) and other miscellaneous expenses. "Other" for the ~~application of accounting for stock options, restricted stock units, performance stock units and deferred stock unit awards (see Note 11 to the audited consolidated financial statements).~~

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twelve months ended October 2, 2020 also includes labor charges, incremental expenses and other expenses associated with closed or partially closed client locations resulting from the COVID-19 pandemic, net of U.S. and non-U.S. governmental labor related credits ($200.6 million), non-cash charge related to operating lease right-of-use assets, property and equipment and other assets from disposal by abandonment of certain rental properties ($28.5 million), non-cash charges related to information technology assets ($26.1 million), gain from the insurance proceeds received related to property damage from a tornado in Nashville ($16.3 million), charges related to a client contract dispute ($15.2 million) and a favorable non-cash settlement of a multiemployer pension plan obligation ($6.7 million). "Other" for the twelve months ended September 27, 2019 also includes cash compensation charges associated with the retirement of the Company's former chief executive officer ($10.4 million), closing costs mainly related to customer contracts ($8.5 million), duplicate rent charges, moving costs, opening costs to build out and ready the Company's new headquarters while occupying its then existing headquarters and closing costs ($8.2 million), advisory fees related to shareholder matters ($7.7 million), banker fees and other charges related to the sale of HCT ($7.7 million) and settlement charges related to exiting a joint venture arrangement ($4.5 million).


~~(2)~~	~~Represents the gain from the divestiture of HCT.~~


~~(3)~~	Represents our estimated share of EBITDA, primarily from our AIM Services Co., Ltd. equity method investment, not already reflected in our Net income attributable to ASI stockholder. EBITDA for this equity method investee is calculated in a manner consistent with consolidated Covenant Adjusted EBITDA but does not represent cash distributions received from this investee.


~~(4)~~	~~Represents the annualizing of net EBITDA from acquisitions and divestitures made during the period.~~

~~(5)~~

"Other" for the twelve months ended September 27, 2019 and September 28, 2018, respectively, includes expenses related to merger and integration related charges ($36.1 million and $78.1 million), adjustments to remove the impact attributable to the adoption of certain new accounting standards, including Accounting Standards Codification 606, ~~Revenue from Contracts with Customers~~, in accordance with the Credit Agreement and indentures ($23.7 million and $7.7 million), organizational streamlining initiatives ($18.7 million and $36.6 million), duplicate rent charges, moving costs, opening costs to build out and ready the Company's new headquarters while occupying its then existing headquarters and closing costs ($8.2 million and $7.7 million), the impact of hyperinflation in Argentina ($4.9 million and $3.8 million), the impact of the change in fair value related to certain gasoline and diesel agreements ($4.7 million loss and $0.2 million gain) and other miscellaneous expenses. "Other" for the twelve months ended September 27, 2019 also includes compensation expense for employee reinvestments funded by benefits from U.S. tax reform ($74.9 million), charges related to certain legal settlements ($27.9 million), non cash impairment charges ($14.8 million), cash compensation charges associated with the retirement of the Company's former chief executive officer ($10.4 million), closing costs mainly related to customer contracts ($8.5 million), advisory fees related to shareholder matters ($7.7 million), banker fees and other charges related to the sale of HCT ($7.7 million) and settlement charges related to exiting a joint venture arrangement ($4.5 million). "Other" for the twelve months ended September 28, 2018 also includes property and other asset write-downs related to a joint venture liquidation and acquisition ($7.5 million) and certain environmental charges ($5.0 million).

Our covenant ~~requirements~~requirement and actual ~~ratios~~ratio for the fiscal year ended ~~September 27, 2019 are~~October 2, 2020 is as ~~follows:~~follows

(1):



	Covenant Requirements	Actual Ratios
~~Consolidated Secured Debt Ratio~~⁽¹⁾	~~5.125x~~	~~1.78x~~
Interest Coverage Ratio (Fixed Charge Coverage Ratio)⁽²⁾	2.000x	~~5.02x~~2.58x

~~(1)~~

The Credit Agreement requires ASI to maintain a maximum Consolidated Secured Debt Ratio, defined as consolidated total indebtedness secured by a lien to Covenant Adjusted EBITDA, of 5.125x. Consolidated total indebtedness secured by a lien is defined in the Credit Agreement as total indebtedness consisting of debt for borrowed money, capital leases, debt in respect of sale-leaseback transactions, disqualified and preferred stock and advances under the Receivables Facility secured by a lien reduced by the amount of cash and cash equivalents on the consolidated balance sheet that is free and clear of any lien. Non-compliance with the maximum Consolidated Secured Debt Ratio could result in the requirement to immediately repay all amounts outstanding under the Credit Agreement, which, if ASI's lenders under our Credit Agreement (other than the lenders in respect of ASI's U.S. Term Loan B, which lenders do not benefit from the maximum Consolidated Secured Debt Ratio covenant) failed to waive any such default, would also constitute a default under the indentures governing our senior notes.

~~(2)~~

(1) The covenant waiver period for the Consolidated Secured Debt Ratio covenant is in effect for the fourth quarter of fiscal 2020 through the third quarter of fiscal 2021.

(2) Our Credit Agreement establishes an incurrence-based minimum Interest Coverage Ratio, defined as Covenant Adjusted EBITDA to consolidated interest expense, the achievement of which is a condition for us to incur additional indebtedness and to make certain restricted payments. If we do not maintain this minimum Interest Coverage Ratio calculated on a pro forma basis for any such additional indebtedness or restricted payments, we could be prohibited from being able to incur additional indebtedness, other than the incremental capacity provided for under the Credit Agreement and pursuant to specified exceptions, and make certain restricted payments, other than pursuant to certain exceptions. The minimum Interest Coverage Ratio is 2.000x for the term of the Credit Agreement. Consolidated interest expense is defined in the Credit Agreement as consolidated interest expense excluding interest income, adjusted for acquisitions and dispositions, further adjusted for certain non-cash or nonrecurring interest expense and our estimated share of interest expense from one equity method investee. The indentures governing our senior notes include a similar requirement which is referred to as a Fixed Charge Coverage Ratio.

Subject to restrictions imposed upon us during the covenant waiver period in accordance with Amendment No. 9 to the Credit Agreement, we and our ~~estimated share of interest expense from one equity method investee. The indentures governing our senior notes include a similar requirement which is referred to as a Fixed Charge Coverage Ratio.~~

~~The Company and its~~ subsidiaries and affiliates may from time to time, in ~~their~~our sole discretion, purchase, repay, redeem or retire any of our outstanding debt securities (including any publicly issued debt securities), in privately negotiated or open market transactions, by tender offer or otherwise, or extend or refinance any of our outstanding indebtedness.

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The following table summarizes our future obligations for debt repayments, ~~capital~~finance leases, estimated interest payments, future minimum rental and similar commitments under noncancelable operating leases as well as contingent obligations related to outstanding letters of credit and guarantees as of ~~September 27, 2019~~October 2, 2020 (dollars in thousands):


	Payments Due by Period
Contractual Obligations as of October 2, 2020	Total		Less than 1 year		1-3 years		3-5 years		More than 5 years
Long-term borrowings(1)(2)	$	9,198,187	$	69,932	$	469,173	$	6,158,580	$	2,500,502
Finance lease obligations	157,329		31,290		45,208		31,668		49,163
Estimated interest payments(2)(3)	1,676,600		359,700		663,700		478,600		174,600
Operating leases and other noncancelable commitments	476,602		85,005		123,831		82,990		184,776
Purchase obligations(4)	816,125		306,984		241,569		70,164		197,408
Other liabilities(5)	365,200		76,600		78,500		13,000		197,100
	$	12,690,043	$	929,511	$	1,621,981	$	6,835,002	$	3,303,549

	Amount of Commitment Expiration by Period
Other Commercial Commitments as of October 2, 2020	Total Amounts Committed		Less than 1 year		1-3 years		3-5 years		More than 5 years
Letters of credit	$	191,667	$	191,667	$	—	$	—	$	—

Payments Due by Period
Contractual Obligations as of September 27, 2019 Total
Less than
1 year
1-3 years 3-5 years
More than
5 years
Long-term borrowings⁽¹⁾
$ 6,571,716
$ 38,607
$ 92,211
$ 2,169,447
$ 4,271,451
Capital lease obligations 148,754
31,321
50,420
30,814
36,199
Estimated interest payments⁽²⁾
1,473,800
237,200
478,100
471,500
287,000
Operating leases and other noncancelable commitments 527,562
101,061
131,673
80,010
214,818
Purchase obligations⁽³⁾
595,289
248,926
158,449
63,031
124,883
Other liabilities⁽⁴⁾
270,100
58,800
32,000
14,000
165,300
$ 9,587,221
$ 715,915
$ 942,853
$ 2,828,802
$ 5,099,651

Amount of Commitment Expiration by Period
Other Commercial Commitments as of September 27, 2019
Total
Amounts
Committed

Less than
1 year
1-3 years 3-5 years
More than
5 years
Letters of credit $ 110,052
$ 110,052
$ —
$ —
$ —


~~(1)~~	(1)Excludes ~~the $48.3 million reduction to long-term borrowings from debt issuance costs and the increase of $10.0 million from the premium on the 5.125% Senior Notes due 2024.~~

~~(2)~~

These amounts represent future interest payments related to our existing debt obligations based on fixed and variable interest rates specified in the associated debt agreements and reflect any current hedging arrangements. Payments related to variable debt are based on applicable rates at September 27, 2019 plus the specified margin in the associated debt agreements for each period presented. The amounts provided relate only to existing debt obligations and do not assume the refinancing or replacement of such debt. The average debt balance for each fiscal year from 2020 through 2025 is $6,496.2 million, $6,460.4 million, $6,414.7 million, $6,195.8 million, $4,956.9 million and $2,976.1 million, respectively. The weighted average interest rate of our existing debt obligations for each fiscal year from 2020 through 2025 is 3.65%, 3.67%, 3.75%, 4.04%, 4.46% and 4.59%, respectively (see Note 5 to the audited consolidated financial statements for the terms and maturities of existing debt obligations).


~~(3)~~	~~Represents commitments for capital projects to help finance improvements or renovations at the facilities in which we operate.~~


~~(4)~~	~~Includes certain unfunded employee retirement, legal settlement, CEO retirement and severance related obligations.~~

~~During~~ the ~~first quarter of fiscal 2019, we extended~~$61.3 million reduction to long-term borrowings from debt issuance costs and $1.0 million reduction from the ~~maturity dates of~~discount on the ~~Revolving Credit Facility, Yen~~U.S. Term Loan B due ~~2022, Canadian Term Loan due 2022, Canadian Term Loan A-1 due 2023~~2027.

(2)Reflects outstanding debt balances as of October 2, 2020 and ~~Euro Term Loan due 2022~~does not reflect the October 30, 2020 repayment of $680.0 million of outstanding borrowings under the revolving credit facility.

(3)These amounts represent future interest payments related to our existing debt obligations based on fixed and variable interest rates specified in the associated debt agreements and reflect any current hedging arrangements. Payments related to variable debt are based on applicable rates at October ~~1, 2023~~2, 2020 plus the specified margin in the associated debt agreements for each period presented. The amounts provided relate only to existing debt obligations and do not assume the refinancing or replacement of such debt. The average debt balance for each fiscal year from 2021 through 2026 is $9,291.3 million, $9,111.7 million, $8,783.4 million, $7,299.7 million, $4,792.2 million and $2,364.1 million, respectively. The weighted average interest rate of our existing debt obligations for each fiscal year from 2021 through 2026 is 3.87%, 3.84%, 3.57%, 3.92%, 4.02% and 3.78%, respectively (see Note 5 to the audited consolidated financial ~~statements)~~statements for the terms and maturities of existing debt obligations).

(4)Represents commitments for capital projects to help finance improvements or renovations at the facilities in which we operate.

(5)Includes certain unfunded employee retirement obligations, CEO retirement and severance related obligations.

We have excluded from the table above uncertain tax liabilities due to the uncertainty of the amount and period of payment. As of ~~September 27, 2019,~~October 2, 2020, we have gross uncertain tax liabilities of ~~$36.3~~$34.6 million (see Note 910 to the audited consolidated financial statements). During fiscal ~~2019,~~2020, we made contributions totaling ~~$10.5~~$4.2 million into our defined benefit pension plans and benefit payments ~~and settlements~~ of ~~$21.5~~$16.7 million out of these plans. Estimated contributions to our defined benefit pension plans in fiscal ~~2020~~2021 are ~~$4.1~~$3.4 million and estimated benefit payments out of these plans in fiscal ~~2020~~2021 are ~~$13.6~~$224.3 million (see Note 89 to the audited consolidated financial statements).

We have an agreement (the "Receivables Facility") with three financial institutions where we sell on a continuous basis an undivided interest in all eligible accounts receivable, as defined in the Receivables Facility. The maximum amount available under the Receivables Facility is $400.0 ~~million, which expires in May 2021.~~million. In addition, the Receivables Facility includes a seasonal tranche which increases the capacity of the Receivables Facility and the maximum amount available by $100.0 million from October through March. During the third quarter of fiscal 2020, we extended the scheduled maturity date of the Receivables Facility from May 2021 to June 2022. All other terms and conditions of the agreement remained largely unchanged (see Note 5 to the audited consolidated financial statements). As of ~~September 27, 2019, there were no~~October 2, 2020 the amount of outstanding borrowings ~~outstanding~~ under the Receivables ~~Facility.~~Facility was $315.6 million. Amounts borrowed under the Receivables Facility fluctuate monthly based on our funding requirements and the level of qualified receivables available to collateralize the Receivables Facility.

Pursuant to the Receivables Facility, we formed ARAMARK Receivables, LLC, a wholly-owned, consolidated, bankruptcy-remote subsidiary. ARAMARK Receivables, LLC was formed for the sole purpose of transferring receivables generated by

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certain of our subsidiaries. Under the Receivables Facility, we and certain of our subsidiaries transfer without recourse all of ~~their~~our accounts receivable to ARAMARK Receivables, LLC. As collections reduce previously transferred interests, interests in new, eligible receivables are transferred to ARAMARK Receivables, LLC, subject to meeting certain conditions.

Our business activities do not include the use of unconsolidated special purpose entities and there are no significant business transactions that have not been reflected in the accompanying financial statements. InBeginning in fiscal 2019, we began insuring portions of our general liability, automobile liability and workers’ compensation risks through a wholly owned captive insurance subsidiary (the "Captive") to enhance our risk financing strategies. The Captive is subject to ~~regulation in~~regulations within its ~~jurisdiction~~domicile of ~~domicile,~~Bermuda, including regulations established by the Bermuda Monetary Authority (the "BMA") relating to levels of liquidity and solvency as such concepts are defined by the ~~regulator.~~BMA. The Captive was in compliance with these regulations as of ~~year-end.~~October 2, 2020. These regulations may have the effect of limiting our ability to access certain cash and cash equivalents held by the Captive for uses other than for the payment of our general liability, automobile liability and workers’ compensation claims and related Captive costs. As of ~~September 27, 2019,~~October 2, 2020, cash and cash equivalents at the Captive was ~~$50.4~~$92.1 million.

WeOn January 29, 2020, our stockholders approved the Second Amended and Restated 2013 Stock Incentive Plan, which amends and restates our 2013 Incentive Plan. The Second Amended and Restated 2013 Stock Incentive Plan provides for up to 7.5 million of new shares authorized for issuance to participants, in addition to the shares that remained available for issuance under the 2013 Incentive Plan as of January 29, 2020 that are ~~self-insured~~not subject to outstanding awards under the 2013 Incentive Plan.

Supplemental Consolidating Information

Pursuant to Regulation S-X Rule 13-01, which simplifies certain disclosure requirements for ~~a limited portion~~guarantors and issuers of guaranteed securities, and which we have early adopted, we are no longer required to provide condensed consolidating financial statements for Aramark and its subsidiaries, including the ~~risk retained~~guarantors and non-guarantors under our ~~general liability, automobile liability~~Credit Agreement and ~~workers’ compensation insurance arrangements. Self-insurance reserves~~the indentures governing our senior notes. ASI, the borrower under our Credit Agreement and the indentures governing our senior notes, and its restricted subsidiaries together comprise substantially all of our assets, liabilities and operations, and there are ~~recorded based~~no material differences between the consolidating information related to Aramark and Aramark Intermediate Holdco Corporation, the direct parent of ASI and a guarantor under our Credit Agreement, on ~~actuarial analyses.~~the one hand, and ASI and its restricted subsidiaries on a standalone basis, on the other hand.

Critical Accounting Policies and Estimates

Our significant accounting policies are described in the notes to the audited consolidated financial statements included in this Annual Report. As described in such notes, we recognize revenue in the period in which the performance obligation is satisfied. ~~During the first quarter of fiscal 2019, we adopted the new accounting standard related to revenue recognition.~~ See ~~Notes 1 and~~Note 7 to our audited consolidated financial statements for further information related to our revenue recognition ~~policy and the impact of adoption of the new accounting standard.~~policy.

In preparing our financial statements, management is required to make estimates and assumptions that, among other things, affect the reported amounts of assets, liabilities, revenue and expenses. These estimates and assumptions are most significant where they involve levels of subjectivity and judgment necessary to account for highly uncertain matters or matters susceptible to change, and where they can have a material impact on our financial condition and operating performance. If actual results were to differ materially from the estimates made, the reported results could be materially affected.

Asset Impairment Determinations

Goodwill, the Aramark trade name and other trade names are primarily indefinite lived intangible assets that are not ~~amortizable~~amortized and are subject to an impairment test that we conduct annually or more frequently if a change in circumstances or the occurrence of events indicates that potential impairment exists. The impairment test may first consider qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. Examples of qualitative factors include, macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, entity-specific events, events affecting reporting units and sustained changes in our stock price. If results of the qualitative assessment indicate a more likely than not determination or if a qualitative assessment is not performed, a quantitative test is performed by comparing the estimated fair value using discounted cash flow calculations of each reporting unit with its estimated net book value. The discounted cash flow calculations are dependent on several subjective factors including the timing of future cash flows, future growth rates and the discount rate. If our assumptions or estimates in our fair value calculations change or if future cash flows or future growth rates vary from what was planned, this may impact our impairment analysis.

We perform the assessment of goodwill at the reporting unit level. Within our FSS International segment, each country or region is evaluated separately since they are relatively autonomous and separate goodwill balances have been recorded for each entity. During the fourth quarter of fiscal ~~2019,~~2020, we performed anthe annual impairment test for goodwill for each of our reporting units using a ~~qualitative~~quantitative testing ~~approach, except for one reporting unit which was tested using the quantitative~~ approach. Based on our evaluation performed, we determined that it was more likely than not that the fair value of each of the reporting units exceeded its respective carrying amount, and therefore, we determined that goodwill was not impaired. ~~The~~

During the second quarter of fiscal 2020, we identified a triggering event from the decline in our stock price resulting from COVID-19. As a result, we performed an interim quantitative impairment test as of March 27, 2020. Based on the evaluation

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performed, we determined that goodwill was not impaired for all but one reporting unit, as the fair value of ~~the~~each reporting unit ~~in our~~substantially exceeded its respective carrying amount. The one reporting unit within the FSS International segment for which goodwill was determined to be impaired had also been tested for impairment using the quantitative approach ~~has a goodwill balance~~during our previous annual impairment test completed as of ~~$282.3 million and~~August 23, 2019. The reporting unit had a fair value that exceeded its carrying value by approximately 22% as of that date. As of March 27, 2020, the quantitative impairment test for this same reporting unit resulted in a fair value that was approximately 34% lower than its carrying value, which was driven most notably by the changes in underlying assumptions used for impairment calculation purposes, including the discount rate as well as the near term growth outlook of the reporting unit pre-COVID-19. As a result, we recognized a non-cash impairment charge of $198.6 million in the Consolidated Statements of (Loss) Income for the fiscal ~~2019.~~year ended October 2, 2020. For tax purposes, the impairment charge is not tax deductible. The impaired reporting unit has a remaining goodwill balance of $90.1 million as of October 2, 2020.

The determination of fair value for each reporting unit includes assumptions, which are considered Level 3 inputs, that are subject to risk and uncertainty. The discounted cash flow calculations are dependent on several subjective factors including the timing of future cash flows, the underlying margin projection assumptions, future growth rates and the discount rate. If our assumptions or estimates in our fair value calculations change or if future cash flows, margin projections or future growth rates vary from what was expected, including those assumptions relating to the duration and severity of COVID-19, this may impact our impairment analysis and could reduce the underlying cash flows used to estimate fair values and result in a decline in fair value that may trigger future impairment charges.

With respect to our other long-lived assets, we are required to test for asset impairment whenever events or circumstances indicate that the carrying value of an asset may not be recoverable. If indicators of impairment are present, we compare the sum of the future expected cash flows from the asset, undiscounted and without interest charges, to the asset’s carrying value. If the sum of the future expected cash flows from the asset is less than the carrying value, an impairment would be recognized for the difference between the estimated fair value and the carrying value of the asset.

In making future cash flow analyses of various assets, we make assumptions relating to the following:

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• The intended use of assets and the expected future cash flows resulting directly from such use;

• Comparable market valuations of businesses similar to Aramark's business segments;

• Industry specific economic conditions;

• Competitor activities and regulatory initiatives; and

• Client and customer preferences and behavior patterns.

We believe that an accounting estimate relating to asset impairment is a critical accounting estimate because the assumptions underlying future cash flow estimates are subject to change from time to time and the recognition of an impairment could have a significant impact on our consolidated statement of (loss) income.

During fiscal 2020, we recorded non-cash impairment charges related to the following: abandonment of rental properties ($28.5 million), information technology assets from either discontinue of use or contracts terminated ($26.1 million) and from client contracts that were reassessed due to the impact of COVID-19 ($30.6 million). For fiscal 2019, ~~the Company~~we recorded ~~non cash~~non-cash impairment charges of approximately $14.8 million.

Litigation and Claims

From time to time, we and our subsidiaries are party to various legal actions, proceedings and investigations involving claims incidental to the conduct of our businesses, including those brought by clients, consumers, employees, government entities and third parties under, among others, federal, state, international, national, provincial and local employment laws, wage and hour laws, discrimination laws, immigration laws, human health and safety laws, import and export controls and customs laws, environmental laws, false claims or whistleblower statutes, procurement regulations, intellectual property laws, food safety and sanitation laws, cost and accounting principles, the Foreign Corrupt Practices Act, the U.K. Bribery Act, other anti-corruption laws, lobbying laws, motor carrier safety laws, data privacy and security laws and alcohol licensing and service laws, or alleging negligence and/or breach of contractual and other obligations. We consider the measurement of litigation reserves as a critical accounting estimate because of the significant uncertainty in some cases relating to the outcome of potential claims or litigation and the difficulty of predicting the likelihood and range of potential liability involved, coupled with the material impact on our results of operations that could result from litigation or other claims. In determining legal reserves, we consider, among other issues:

• interpretation of contractual rights and obligations;

• the status of government regulatory initiatives, interpretations and investigations;

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• the status of settlement negotiations;

• prior experience with similar types of claims;

• whether there is available insurance; and

• advice of counsel.

During fiscal 2019, ~~the Company~~we recorded approximately $27.9 million of expenses related to certain legal ~~settlements of approximately $27.9 million.~~settlements.

Allowance for Doubtful Accounts

We encounter risks associated with revenue and the collection of the associated accounts receivable. We record a provision for accounts receivable that are considered to be uncollectible. In order to calculate the appropriate provision, we analyze the creditworthiness of specific customers, aging of customer balances, general and specific industry economic conditions, industry concentrations, such as exposure to small and medium-sized businesses, the non-profit healthcare sector and the automotive industry, the airline and financial services industries and contractual rights and obligations. The accounting estimate related to the allowance for doubtful accounts is a critical accounting estimate because the underlying assumptions used for the allowance can change from time to time and uncollectible accounts could potentially have a material impact on our results of operations. We adopted a new accounting standard related to the measurement of expected credit losses as of October 3, 2020 (the first day of fiscal 2021) (see Note 1 to the audited consolidated financial statements).

As of October 2, 2020 and September 27, 2019, ~~and September 28, 2018, the Company's~~our allowance for doubtful accounts was approximately $74.9 million and $49.6 million, ~~and $52.7 million,~~ respectively. The increase in the allowance for doubtful accounts during fiscal 2020 reflects the continued economic uncertainty resulting from COVID-19.

Inventory Obsolescence

We record an inventory obsolescence reserve for obsolete, excess and slow-moving inventory, principally in the Uniform segment. In calculating our inventory obsolescence reserve, we analyze historical and projected data regarding customer demand within specific product categories and make assumptions regarding economic conditions within customer specific industries, as well as style and product changes. Our accounting estimate related to inventory obsolescence is a critical accounting estimate because customer demand in certain of our businesses can be variable and changes in our reserve for inventory obsolescence could materially affect our results of operations.

As of October 2, 2020 and September 27, 2019, ~~and September 28, 2018, the Company's~~our reserve for inventory obsolescence was approximately ~~$23.6~~$36.7 million and ~~$21.5~~$23.6 million, respectively.

Self-Insurance Reserves

38We self-insure for certain obligations related to our employee health care benefit programs, as well as for certain risks that we retain under our general liability, automobile liability and workers’ compensation liability programs. Our reserves are estimated through actuarialmethods, with the assistance of third-party actuaries, using loss development assumptions based on our claims history. The accounting estimates related to our self-insurance reserves are critical accounting estimates because changes in our claim experience, our ability to settle claims or other estimates and judgments we use could potentially have a material impact on our results of operations.

~~Table~~As of ~~Contents~~October 2, 2020 and September 27, 2019, our self-insurance reserves were approximately $250.1 million and $238.9 million, respectively.

Income Taxes

We use the asset and liability method of accounting for income taxes. Under this method, income tax expense is recognized for the amount of taxes payable or refundable for the current year and for deferred tax liabilities and assets for the future tax consequences of events that have been recognized in our consolidated financial statements or tax returns. We make assumptions, judgments and estimates to determine the current income tax provision (benefit), deferred tax asset and liabilities and valuation allowance recorded against a deferred tax asset. The assumptions, judgments and estimates relative to the current income tax provision (benefit) take into account current tax laws, their interpretation and possible results of foreign and domestic tax audits. Changes in tax law, their interpretation and resolution of tax audits could significantly impact the income taxes provided in our consolidated financial statements. Assumptions, judgments and estimates relative to the amount of deferred income taxes take into account future taxable income. Any of the assumptions, judgments and estimates mentioned above could cause the actual income tax obligations to differ from our estimates.

Critical accounting estimates and the related assumptions are evaluated periodically as conditions warrant, and changes to such estimates are recorded as new information or changed conditions require.

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New Accounting Standards Updates

See Note 1 to the audited consolidated financial statements for a full description of recent accounting standards updates, including the expected dates of adoption.

Item 7A. Quantitative and Qualitative Disclosure About Market Risk

We are exposed to the impact of interest rate changes and manage this exposure through the use of variable-rate and fixed-rate debt and by utilizing interest rate swaps. We do not enter into contracts for trading purposes and do not use leveraged instruments. The information below summarizes our market risks associated with debt obligations and other significant financial instruments as of ~~September 27, 2019~~October 2, 2020 (see Notes 5 and 6 to the audited consolidated financial statements). Fair values were computed using market quotes, if available, or based on discounted cash flows using market interest rates as of the end of the respective periods. For debt obligations, the table presents principal cash flows and related interest rates by contractual fiscal year of maturity. Variable interest rates disclosed represent the weighted-average rates of the portfolio at ~~September 27, 2019.~~October 2, 2020. For interest rate swaps, the table presents the notional amounts and related weighted-average interest rates by fiscal year of maturity. The variable rates presented are the average forward rates for the term of each contract.


	(US$ equivalent in millions)
	Expected Fiscal Year of Maturity
As of October 2, 2020	2021			2022				2023			2024				2025			Thereafter			Total			Fair Value
Debt:
Fixed rate	$	31		$	25			$	20		$	17			$	2,495		$	1,700		$	4,288		$	4,351
Average interest rate	4.2		%	4.2		%		4.2		%	4.2		%		5.5		%	4.9		%	5.3		%
Variable rate	$	70		$	379		(a)	$	90		$	2,002		(b)	$	1,676		$	850		$	5,067		$	4,909
Average interest rate	3.9		%	1.9		%		1.9		%	1.9		%		1.9		%	1.9		%	1.9		%
Interest Rate Swaps:
Receive variable/pay fixed	$	329		$	250			$	1,550		$	—			$	800		$	—		$	2,929		$	(118)
Average pay rate	1.9		%	2.6		%		2.1		%	—		%		1.6		%	—		%
Average receive rate	0.1		%	0.1		%		0.1		%	—		%		0.1		%	—		%

(US$ equivalent in millions)
Expected Fiscal Year of Maturity
As of September 27, 2019 2020 2021 2022 2023 2024 Thereafter Total Fair Value
Debt:
Fixed rate $ 31
$ 31
$ 20
$ 14
$ 917
$ 2,641
$ 3,654
$ 3,782
Average interest rate 5.0 % 5.0 % 5.0 % 5.0 % 5.1 % 4.7 % 4.8 %
Variable rate $ 39
$ 39
^(a)
$ 53
$ 80
$ 1,190
$ 1,665
$ 3,066
$ 3,069
Average interest rate 3.1 % 2.4 % 2.4 % 2.4 % 3.7 % 4.1 % 3.8 %
Interest Rate Swaps:
Receive variable/pay fixed $ 425
$ 250
$ 327
$ 1,550
$ —
$ —
$ 2,552
$ (43 )
Average pay rate 2.2 % 2.5 % 2.0 % 2.1 % — % — %
Average receive rate 2.1 % 2.1 % 1.6 % 2.1 % — % — %

(a)As of October 2, 2020, the amount of outstanding borrowings under the Receivables Facility was $315.6 million.


~~(a)~~	~~As of September 27, 2019, there were no borrowings outstanding under the Receivables Facility due 2021.~~

(b)Reflects outstanding debt balances as of October 2, 2020 and does not reflect the October 30, 2020 repayment of $680.0 million of outstanding borrowings under the revolving credit facility.

As of ~~September 27, 2019, the Company~~October 2, 2020, we had foreign currency forward exchange contracts outstanding with nominal notional amounts ~~of €72.6 million, CAD 30.0 million and £7.5 million~~ to mitigate the risk of changes in foreign currency exchange rates on short-term intercompany loans to certain international subsidiaries. As of ~~September 27, 2019,~~October 2, 2020, the fair value of these foreign exchange contracts is $0.1 million, which is included in ~~"Prepayments and Other Current Assets"~~"Accounts Payable" in our Consolidated Balance Sheets.

~~The Company~~We entered into a series of pay fixed/receive floating gasoline and diesel fuel agreements based on the Department of Energy weekly retail on-highway index in order to limit its exposure to price fluctuations for gasoline and diesel fuel. As of ~~September 27, 2019, the Company has~~October 2, 2020, we had contracts for approximately ~~18.6~~11.1 million gallons outstanding through fiscal ~~2020.~~2021. As of ~~September 27, 2019,~~October 2, 2020, the fair value of ~~the Company’s~~our gasoline and diesel fuel hedge agreements is ~~$0.5~~$1.8 million, which is included in "Accounts Payable" in our Consolidated Balance Sheets.

Item 8. Financial Statements and Supplementary Data

See Financial Statements and Schedule beginning on page S-1.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Not applicable.

Table ~~of Contents~~o f Content s

Item 9A. Controls and Procedures

(a) Evaluation of Disclosure Controls and Procedures

~~The Company’s~~Our management, with the participation of ~~the Company’s~~our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of ~~the Company’s~~our disclosure controls and procedures (as that term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) as of the end of the period covered by this report. Based on that evaluation, management, with the participation of ~~the~~our Chief Executive Officer and Chief Financial Officer, concluded that ~~the Company’s~~our disclosure controls and procedures, as of the end of the period covered by this report, are functioning effectively to provide reasonable assurance that the information required to be disclosed by ~~the Company~~us in reports filed under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and is accumulated and communicated to ~~the Company's~~our management, including ~~its~~our principal executive and principal financial officers, to allow timely decisions regarding required disclosures. A controls system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the controls system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.

(b) Management’s Annual Report on Internal Control Over Financial Reporting

~~The Company's~~Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rule 13a-15(f) of the Exchange Act. Under the supervision and with the participation of ~~the Company's~~our management, including ~~the~~our Chief Executive Officer and Chief Financial Officer, ~~the Company~~we conducted an evaluation of the effectiveness of ~~the Company's~~our internal control over financial reporting based upon criteria established in Internal Control – Integrated Framework (2013) by the Committee of Sponsoring Organizations of the Treadway Commission. Based on that evaluation, ~~the Company's~~our management concluded that ~~the Company's~~our internal control over financial reporting was effective as of ~~September 27, 2019.~~October 2, 2020. The effectiveness of ~~the Company's~~our internal control over financial reporting as of ~~September 27, 2019~~October 2, 2020 has been audited by KPMG LLP, ~~the Company's~~our independent registered public accounting firm, as stated in their report that is included herein on the following page.

No change in ~~the Company’s~~our internal control over financial reporting occurred during ~~the Company’s~~our fourth quarter of fiscal ~~2019~~2020 that has materially affected, or is reasonably likely to materially affect, ~~the Company’s~~our internal control over financial reporting.

Table ~~of Contents~~o f Content s

Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors

Aramark:

Opinion on Internal Control Over Financial Reporting

We have audited Aramark and ~~subsidiaries,~~subsidiaries’ (the Company) internal control over financial reporting as of ~~September 27, 2019,~~October 2, 2020, based on criteria established in Internal Control -– Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of ~~September 27, 2019,~~October 2, 2020, based on criteria established in Internal Control -– Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of October 2, 2020 and September 27, 2019, ~~and September 28, 2018,~~ the related consolidated statements of (loss) income, comprehensive (loss) income, cash flows, and stockholders’ equity for each of the fiscal years ended October 2, 2020, September 27, 2019 and September 28, 2018, ~~and September 29, 2017~~ and the related notes and financial statement schedule II (collectively, the consolidated financial statements), and our report dated November ~~26, 2019~~24, 2020 expressed an unqualified opinion on those consolidated financial statements.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal ~~Controls over~~Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ KPMG LLP

Philadelphia, Pennsylvania

November ~~26, 2019~~

24, 2020

Table ~~of Contents~~o f Content s

Item 9B. Other Information

Not applicable.

Table ~~of Contents~~o f Content s

PART III

Item 10. Directors, Executive Officers and Corporate Governance

Information about our directors and persons nominated to become directors required by Item 10 will be included under the caption "Proposal No. 1 - Election of Directors" in ~~the Company's~~our Proxy Statement for the ~~2020~~2021 Annual Meeting of Stockholders and is incorporated herein by reference. Information about our executive officers is included under the caption “Information About Our Executive Officers” in Part I of this report and incorporated herein.

Information on beneficial ownership reporting required by Item 10, if any, will be included under the caption "Delinquent Section 16(a) Reports" in ~~the Company's~~our Proxy Statement for the ~~2020~~2021 Annual Meeting of Stockholders and is incorporated herein by reference.

We have a Business Conduct Policy that applies to all of our directors, officers and employees, including our principal executive officer, principal financial officer and principal accounting officer, which is available on the Investor Relations section of our website at www.aramark.com. A copy of our Business Conduct Policy may be obtained free of charge by writing to Investor Relations, Aramark, 2400 Market Street, Philadelphia, PA 19103. Our Business Conduct Policy contains a "code of ethics," as defined in Item 406(b) of Regulation S-K. Please note that our website address is provided as an inactive textual reference only. We will make any legally required disclosures regarding amendments to, or waivers of, provisions of our code of ethics on our website.

The remaining information required by Item 10 will be included under the caption "Board Committees and Meetings" in ~~the Company's~~our Proxy Statement for the ~~2020~~2021 Annual Meeting of Stockholders and is incorporated herein by reference.

Item 11. Executive Compensation

Information required by Item 11 will be included under the caption "Compensation Matters" in ~~the Company's~~our Proxy Statement for the ~~2020~~2021 Annual Meeting of Stockholders and is incorporated herein by reference.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Information required by Item 12 will be included under the captions "Security Ownership of Certain Beneficial Owners and Management" and "Equity Compensation Plan Information" in ~~the Company's~~our Proxy Statement for the ~~2020~~2021 Annual Meeting of Stockholders and is incorporated herein by reference.

Item 13. Certain Relationships and Related Transactions, and Director Independence

Information required by Item 13 will be included under the captions "Certain Relationships and Related Transactions" and "Director Independence and Independence Determinations" in ~~the Company's~~our Proxy Statement for the ~~2020~~2021 Annual Meeting of Stockholders and is incorporated herein by reference.

Item 14. Principal Accountant Fees and Services

Information required by Item 14 will be included under the caption "Fees to Independent Registered Public Accounting Firm" in ~~the Company's~~our Proxy Statement for the ~~2020~~2021 Annual Meeting of Stockholders and is incorporated herein by reference.

Table of Contents

PART IV

Item 15. Exhibits and Financial Statement Schedules

(a) Financial Statements

See Index to Financial Statements and Schedule at page S-1 and the Exhibit Index.

(b) Exhibits Required by Item 601 of Regulation S-K

See the Exhibit Index which is incorporated herein by reference.

See Index to Financial Statements and Schedule at page S-1.

Item 16. Form 10-K Summary

None.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this annual report to be signed on its behalf by the undersigned, thereunto duly authorized on November ~~26, 2019.~~

24, 2020.

Aramark

By:

/s/ ~~STEPHEN P. BRAMLAGE, JR.~~THOMAS G. ONDROF

Name:

~~Stephen P. Bramlage, Jr.~~Thomas G. Ondrof

Title:

Executive Vice President and Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this annual report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on November ~~26, 2019.~~

24, 2020.



Name						Capacity

/s/ JOHN J. ZILLMER						Chief Executive Officer and Director
John J. Zillmer						(Principal Executive Officer)

/s/ ~~STEPHEN P. BRAMLAGE JR.~~THOMAS G. ONDROF						Executive Vice President and Chief Financial Officer
~~Stephen P. Bramlage, Jr.~~Thomas G. Ondrof						(Principal Financial Officer and Principal Accounting Officer)

/s/ SUSAN CAMERON						Director
Susan Cameron

/s/ GREG CREED						Director
Greg Creed

/s/ CALVIN DARDEN						Director
Calvin Darden

/s/ RICHARD W. DREILING						Director
Richard W. Dreiling

/s/ IRENE M. ESTEVES						Director
Irene M. Esteves

/s/ DANIEL J. HEINRICH						Director
Daniel J. Heinrich

/s/ PAUL HILAL						Vice Chairman, Director
Paul Hilal

/s/ KAREN KING						Director
Karen King

/s/ STEPHEN I. SADOVE						Chairman, Director
Stephen I. Sadove

/s/ ART WINKLEBLACK						Director
Art Winkleblack

Table of Contents

ARAMARK AND SUBSIDIARIES

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULE



	Page
Report of Independent Registered Public Accounting Firm				~~S-2~~S-2
Consolidated Balance Sheets as of October 2, 2020 and September 27, 2019				S-4
Consolidated Statements of (Loss) Income for the fiscal years ended October 2, 2020, September 27, 2019 and September 28, 2018				~~S-4~~S-5
Consolidated Statements of Comprehensive (Loss) Income for the fiscal years ended October 2, 2020, September 27, 2019 and September 28, 2018 ~~and September 29, 2017~~				~~S-5~~S-6
~~Consolidated Statements of Comprehensive Income for the fiscal years ended September 27, 2019, September 28, 2018 and September 29, 2017~~		~~S-6~~
Consolidated Statements of Cash Flows for the fiscal years ended October 2, 2020, September 27, 2019 and September 28, 2018 ~~and September 29, 2017~~			~~S-7~~S-7
Consolidated Statements of Stockholders' Equity for the fiscal years ended October 2, 2020, September 27, 2019 and September 28, 2018 ~~and September 29, 2017~~				~~S-8~~S-8
Notes to Consolidated Financial Statements				~~S-9~~S-9
Schedule II—Valuation and Qualifying Accounts and Reserves for the fiscal years ended October 2, 2020, September 27, 2019 and September 28, 2018 ~~and September 29, 2017~~				~~S-59~~S-53

All other schedules are omitted because they are not applicable, not required, or the information required to be set forth therein is included in the consolidated financial statements or in the notes thereto.

S-1

Table of Contents

Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors

Aramark:

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of Aramark and subsidiaries (the Company) as of October 2, 2020 and September 27, 2019, ~~and September 28, 2018,~~ the related consolidated statements of (loss) income, comprehensive (loss) income, cash flows, and stockholders’ equity for each of the fiscal years ended October 2, 2020, September 27, 2019 and September 28, 2018 ~~and September 29, 2017~~ and the related notes and financial statement schedule II (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of October 2, 2020 and September 27, 2019, ~~and September 28, 2018,~~ and the results of its operations and its cash flows for each of the fiscal years ended October 2, 2020, September 27, 2019 and September 28, 2018, ~~and September 29, 2017,~~ in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of ~~September 27, 2019,~~October 2, 2020, based on criteria established in Internal Control -– Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated November ~~26, 2019,~~24, 2020, expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.

Change in Accounting Principle

As discussed in Note 8 to the consolidated financial statements, the Company has changed its method of accounting for leases as of September 28, 2019 due to the adoption of Accounting Standards Codification Topic 842, Leases. As discussed in Note 7 to the consolidated financial statements, the Company has changed its method of accounting for revenue as of September 29, 2018 due to the adoption of Accounting Standards Codification Topic 606, Revenue from Contracts with Customers.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgment. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

~~Assessment~~ Impairment of ~~the carrying value of~~ goodwill recorded in one reporting unit in the FSS International segment

As discussed in Note 4 to the consolidated financial statements, the Company performs goodwill impairment testing on an annual basis and whenever events and changes in circumstances indicate that the carrying value of a reporting unit might exceed its fair value. ~~The goodwill balance as~~During the second quarter of ~~September 27, 2019 was $5,518.8 million. The~~fiscal year 2020, the Company performed aan interim quantitative goodwill impairment ~~test~~test. Based on the evaluation performed, the Company determined that goodwill was not impaired for ~~each reporting unit using a qualitative approach, except for~~all but one reporting unit inwithin the FSS International ~~segment which was tested using~~segment. The reporting unit recognized an

S-2

Table of Contents

impairment charge of $198.6 million for the ~~quantitative approach. The~~year ended October 2, 2020 and has a remaining goodwill balance ~~for that reporting unit was $282.3~~of $90.1 million ~~as of September 27, 2019.~~

~~S-2~~

~~Table of Contents~~

at the fiscal year end.

We identified the ~~assessment~~impairment of ~~the carrying value of~~ goodwill recorded for that reporting unit as a critical audit matter. Significant auditor judgment was required to evaluate the Company’s determination of the fair value of the reporting unit used in the Company’s impairment test, which was performed using a discounted cash flow model and included assumptions related to ~~forecasted~~the terminal year revenue growth ~~rates,~~rate, earnings ~~discount rate,~~before interest and tax margin projections, and the ~~effect~~discount rate. We performed a sensitivity analysis to determine that these were the assumptions that could cause significant change in the determination of the Company’s actions to exit or plans to improve the operating performance of certain underperforming client contracts. Minor changes to these key assumptions had a significant effect on the assessment of the carryingfair value of the ~~goodwill.~~reporting unit.

The following are the primary procedures we performed to address this critical audit ~~matter included~~matter. We evaluated the ~~following. We~~design and tested the operating effectiveness of certain internal controls ~~over~~related to the Company’s goodwill impairment ~~assessment process, including~~process. This included controls related to the ~~development~~determination of the ~~key assumptions.~~Company’s terminal year revenue growth rate, earnings before interest and tax margin projections, and the discount rate applied to the projected cash flows. We evaluated the Company’s ~~forecasted~~terminal year revenue growth ~~rates~~rate and earnings ~~assumptions~~before interest and tax margin projections by comparing to external market and industry data. We compared the ~~assumptions~~Company’s historical cash flow forecasts to the ~~Company’s historical~~corresponding actual results to assess the Company’s ability to ~~accurately~~reasonably forecast. We assessed the impact ~~of the Company's actions to exit~~ and likelihood of the plans to improve the operating ~~performance~~results of certain underperforming client contracts by comparing the assumptions to the Company’s past performance ~~carrying out~~of similar actions. We involved a valuation professional with specialized skills and knowledge, who assisted in:

•evaluating the Company’s discount rate, by comparing it against a discount rate range that was independently developed using publicly available third-party market data for comparable entities, and

•developing an estimate of the reporting unit’s fair value using the reporting unit’s cash flow forecast and an independently developed discount rate, and compared the results of our estimate of fair value to the Company’s fair value estimate.

/s/ KPMG LLP

We have served as the Company's auditor since 2002.

Philadelphia, Pennsylvania

November ~~26, 2019~~

24, 2020

S-3

Table of Contents

ARAMARK AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

OCTOBER 2, 2020 AND SEPTEMBER 27, 2019 ~~AND SEPTEMBER 28, 2018~~

(in thousands, except share amounts)


	October 2, 2020		September 27, 2019
ASSETS
Current Assets:
Cash and cash equivalents	$	2,509,188	$	246,643
Receivables (less allowances: 2020 - $74,925; 2019 - $49,566)	1,431,206		1,806,964
Inventories	436,473		411,319
Prepayments and other current assets	298,944		193,461
Total current assets	4,675,811		2,658,387
Property and Equipment, at cost:
Land, buildings and improvements	929,354		947,522
Service equipment and fixtures	4,184,603		3,993,014
	5,113,957		4,940,536
Less - Accumulated depreciation	(3,063,049)		(2,758,774)
	2,050,908		2,181,762
Goodwill	5,343,828		5,518,800
Other Intangible Assets	1,932,637		2,033,566
Operating Lease Right-of-use Assets (see Note 8)	551,394		0
Other Assets	1,158,106		1,343,806
	$	15,712,684	$	13,736,321
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current maturities of long-term borrowings	$	99,915	$	69,928
Current operating lease liabilities (see Note 8)	71,810		0
Accounts payable	663,455		999,517
Accrued payroll and related expenses	572,076		509,617
Accrued expenses and other current liabilities	940,202		1,126,236
Total current liabilities	2,347,458		2,705,298
Long-Term Borrowings	9,178,508		6,612,239
Noncurrent Operating Lease Liabilities (see Note 8)	341,667		0
Deferred Income Taxes and Other Noncurrent Liabilities	1,099,075		1,088,822
Redeemable Noncontrolling Interest	9,988		9,915
Stockholders' Equity:
Common stock, par value $0.01 (authorized: 600,000,000 shares; issued: 2020—290,663,529 shares and 2019—282,919,536; and outstanding: 2020—253,042,169 shares and 2019—247,756,091 shares)	2,907		2,829
Capital surplus	3,416,132		3,236,450
Retained earnings	532,379		1,107,029
Accumulated other comprehensive loss	(307,258)		(216,965)
Treasury stock (shares held in treasury: 2020—37,621,360 shares and 2019—35,163,445 shares)	(908,172)		(809,296)
Total stockholders' equity	2,735,988		3,320,047
	$	15,712,684	$	13,736,321

September 27, 2019 September 28, 2018
ASSETS
Current Assets:
Cash and cash equivalents $ 246,643
$ 215,025
Receivables (less allowances: 2019 - $49,566; 2018 - $52,682) 1,806,964
1,790,433
Inventories 411,319
724,802
Prepayments and other current assets 193,461
171,165
Total current assets 2,658,387
2,901,425
Property and Equipment, at cost:
Land, buildings and improvements 947,522
901,874
Service equipment and fixtures 3,993,014
2,296,331
4,940,536
3,198,205
Less - Accumulated depreciation (2,758,774 ) (1,820,111 )
2,181,762
1,378,094
Goodwill 5,518,800
5,610,568
Other Intangible Assets 2,033,566
2,136,844
Other Assets 1,343,806
1,693,171
$ 13,736,321
$ 13,720,102
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current maturities of long-term borrowings $ 69,928
$ 30,907
Accounts payable 999,517
1,018,920
Accrued payroll and related expenses 509,617
422,299
Accrued expenses and other current liabilities 1,126,236
1,018,033
Total current liabilities 2,705,298
2,490,159
Long-Term Borrowings 6,612,239
7,213,077
Deferred Income Taxes and Other Noncurrent Liabilities 1,088,822
977,215
Redeemable Noncontrolling Interest 9,915
10,093
Stockholders' Equity:
Common stock, par value $.01 (authorized: 600,000,000 shares; issued: 2019—282,919,536 shares and 2018—279,314,297; and outstanding: 2019—247,756,091 shares and 2018—246,744,438 shares)
2,829
2,793
Capital surplus 3,236,450
3,132,421
Retained earnings 1,107,029
710,519
Accumulated other comprehensive loss (216,965 ) (91,223 )
Treasury stock (shares held in treasury: 2019—35,163,445 shares and 2018—32,569,859 shares) (809,296 ) (724,952 )
Total stockholders' equity 3,320,047
3,029,558
$ 13,736,321
$ 13,720,102

The accompanying notes are an integral part of these consolidated financial statements.

S-4

Table of Contents

ARAMARK AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF (LOSS) INCOME

FOR THE FISCAL YEARS ENDED OCTOBER 2, 2020, SEPTEMBER 27, 2019 AND SEPTEMBER 28, 2018 ~~AND SEPTEMBER 29, 2017~~

(in thousands, except per share data)


	Fiscal Year Ended
	October 2, 2020		September 27, 2019		September 28, 2018
Revenue	$	12,829,559	$	16,227,341	$	15,789,633
Costs and Expenses:
Cost of services provided	11,993,667		14,532,662		13,997,911
Depreciation and amortization	595,195		592,573		596,182
Selling and general corporate expenses	307,016		367,256		377,129
Goodwill impairment	198,600		0		0
Gain on sale of Healthcare Technologies	0		(156,309)		0
	13,094,478		15,336,182		14,971,222
Operating (loss) income	(264,919)		891,159		818,411
Interest and Other Financing Costs, net	382,800		334,987		346,535
(Loss) Income Before Income Taxes	(647,719)		556,172		471,876
(Benefit) Provision for Income Taxes	(186,284)		107,706		(96,564)
Net (loss) income	(461,435)		448,466		568,440
Less: Net income (loss) attributable to noncontrolling interest	94		(83)		555
Net (loss) income attributable to Aramark stockholders	$	(461,529)	$	448,549	$	567,885

(Loss) Earnings per share attributable to Aramark stockholders:
Basic	$	(1.83)	$	1.82	$	2.31
Diluted	$	(1.83)	$	1.78	$	2.24
Weighted Average Shares Outstanding:
Basic	251,828		246,854		245,771
Diluted	251,828		252,010		253,352

Fiscal Year Ended
September 27, 2019 September 28, 2018 September 29, 2017
Revenue $ 16,227,341
$ 15,789,633
$ 14,604,412
Costs and Expenses:
Cost of services provided 14,532,662
13,997,911
12,995,403
Depreciation and amortization 592,573
596,182
508,212
Selling and general corporate expenses 367,256
377,129
299,170
Gain on sale of Healthcare Technologies (156,309 ) —
—
15,336,182
14,971,222
13,802,785
Operating income 891,159
818,411
801,627
Interest and Other Financing Costs, net 334,987
346,535
280,985
Income Before Income Taxes 556,172
471,876
520,642
Provision (Benefit) for Income Taxes 107,706
(96,564 ) 146,455
Net income 448,466
568,440
374,187
Less: Net income (loss) attributable to noncontrolling interest (83 ) 555
264
Net income attributable to Aramark stockholders $ 448,549
$ 567,885
$ 373,923

Earnings per share attributable to Aramark stockholders:
Basic $ 1.82
$ 2.31
$ 1.53
Diluted $ 1.78
$ 2.24
$ 1.49
Weighted Average Shares Outstanding:
Basic 246,854
245,771
244,453
Diluted 252,010
253,352
251,557

The accompanying notes are an integral part of these consolidated financial statements.

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ARAMARK AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

FOR THE FISCAL YEARS ENDED OCTOBER 2, 2020, SEPTEMBER 27, 2019 AND SEPTEMBER 28, 2018 ~~AND SEPTEMBER 29, 2017~~

(in thousands)


	Fiscal Year Ended
	October 2, 2020		September 27, 2019		September 28, 2018
Net (loss) income	$	(461,435)	$	448,466	$	568,440
Other comprehensive (loss) income, net of tax:
Pension plan adjustments	(25,669)		(22,594)		20,647
Foreign currency translation adjustments	(7,818)		(34,308)		(31,253)
Cash flow hedges:
Unrealized (losses) gains arising during the period	(82,005)		(62,450)		39,311
Reclassification adjustments	25,463		(4,798)		3,675
Share of equity investee's comprehensive (loss) income	(264)		(1,592)		157
Other comprehensive (loss) income, net of tax	(90,293)		(125,742)		32,537
Comprehensive (loss) income	(551,728)		322,724		600,977
Less: Net income (loss) attributable to noncontrolling interest	94		(83)		555
Comprehensive (loss) income attributable to Aramark stockholders	$	(551,822)	$	322,807	$	600,422

Fiscal Year Ended
September 27, 2019 September 28, 2018 September 29, 2017
Net income $ 448,466
$ 568,440
$ 374,187
Other comprehensive income (loss), net of tax:
Pension plan adjustments (22,594 ) 20,647
19,992
Foreign currency translation adjustments (34,308 ) (31,253 ) 5,903
Cash flow hedges:
Unrealized gains (losses) arising during the period (62,450 ) 39,311
19,449
Reclassification adjustments (4,798 ) 3,675
10,130
Share of equity investee's comprehensive income (loss) (1,592 ) 157
1,549
Other comprehensive income (loss), net of tax (125,742 ) 32,537
57,023
Comprehensive income 322,724
600,977
431,210
Less: Net income (loss) attributable to noncontrolling interest (83 ) 555
264
Comprehensive income attributable to Aramark stockholders $ 322,807
$ 600,422
$ 430,946

The accompanying notes are an integral part of these consolidated financial statements.

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ARAMARK AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE FISCAL YEARS ENDED OCTOBER 2, 2020, SEPTEMBER 27, 2019 AND SEPTEMBER 28, 2018 ~~AND SEPTEMBER 29, 2017~~

(in thousands)


	Fiscal Year Ended										Fiscal Year Ended
	September 27, 2019			September 28, 2018			September 29, 2017				October 2, 2020		September 27, 2019		September 28, 2018
Cash flows from operating activities:										Cash flows from operating activities:
Net income	$	448,466		$	568,440		$	374,187
Adjustments to reconcile net income to net cash provided by operating activities:
Net (loss) income										Net (loss) income	$	(461,435)	$	448,466	$	568,440
Adjustments to reconcile net (loss) income to net cash provided by operating activities:										Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization	592,573			596,182			508,212			Depreciation and amortization	595,195		592,573		596,182
Goodwill impairment and asset write-downs										Goodwill impairment and asset write-downs	283,743		0		0
Deferred income taxes	40,503			(104,289		)	(37,856		)	Deferred income taxes	(134,048)		40,503		(104,289)
Share-based compensation expense	55,280			88,276			65,155			Share-based compensation expense	30,339		55,280		88,276
Net gain on sale of Healthcare Technologies	(139,165		)	—			—			Net gain on sale of Healthcare Technologies	0		(139,165)		0
Changes in operating assets and liabilities:										Changes in operating assets and liabilities:
Accounts Receivable	(78,771		)	(45,891		)	(111,423		)	Accounts Receivable	362,708		(78,771)		(45,891)
Inventories	(49,732		)	(40,187		)	(21,147		)	Inventories	(25,675)		(49,732)		(40,187)
Prepayments and Other Current Assets	(37,854		)	42,450			95,536			Prepayments and Other Current Assets	(86,444)		(37,854)		42,450
Accounts Payable	17,680			26,658			93,965			Accounts Payable	(342,069)		17,680		26,658
Accrued Expenses	193,532			(111,386		)	26,804			Accrued Expenses	(143,640)		193,532		(111,386)
Payments made to clients on contracts (see Note 7)	(40,073		)	—			—
Payments made to clients on contracts										Payments made to clients on contracts	(69,575)		(40,073)		0
Changes in other noncurrent liabilities	18,904			1,576			31,959			Changes in other noncurrent liabilities	92,782		18,904		1,576
Changes in other assets	(41,436		)	(2,225		)	(9,342		)	Changes in other assets	66,650		(41,436)		(2,225)
Other operating activities	4,320			32,271			36,776			Other operating activities	8,151		4,320		32,271
Net cash provided by operating activities	984,227			1,051,875			1,052,826			Net cash provided by operating activities	176,682		984,227		1,051,875
Cash flows from investing activities:										Cash flows from investing activities:
Purchases of property and equipment and other	(503,090		)	(628,604		)	(552,729		)	Purchases of property and equipment and other	(418,508)		(503,090)		(628,604)
Disposals of property and equipment	17,871			10,491			18,906			Disposals of property and equipment	54,074		17,871		10,491
Proceeds from divestitures	293,711			—			—			Proceeds from divestitures	0		293,711		0
Acquisition of certain businesses, net of cash acquired										Acquisition of certain businesses, net of cash acquired
Working capital other than cash acquired	10,634			37,985			8,114			Working capital other than cash acquired	(3,081)		10,634		37,985
Property and equipment	(3,320		)	(283,447		)	(2,273		)	Property and equipment	(1,264)		(3,320)		(283,447)
Additions to goodwill, other intangible assets and other assets, net	(52,177		)	(1,994,822		)	(147,963		)	Additions to goodwill, other intangible assets and other assets, net	(17,856)		(52,177)		(1,994,822)
Proceeds from governmental agencies related to property and equipment	23,025			—			—			Proceeds from governmental agencies related to property and equipment	23,550		23,025		0
Other investing activities	3,825			(6,879		)	(2,539		)	Other investing activities	1,965		3,825		(6,879)
Net cash used in investing activities	(209,521		)	(2,865,276		)	(678,484		)	Net cash used in investing activities	(361,120)		(209,521)		(2,865,276)
Cash flows from financing activities:										Cash flows from financing activities:
Proceeds from long-term borrowings	77,630			3,177,313			3,851,417			Proceeds from long-term borrowings	3,239,772		77,630		3,177,313
Payments of long-term borrowings	(654,560		)	(973,689		)	(3,911,992		)	Payments of long-term borrowings	(1,000,463)		(654,560)		(973,689)
Net change in funding under the Receivables Facility	—			(254,200		)	(13,800		)	Net change in funding under the Receivables Facility	315,600		0		(254,200)
Payments of dividends	(108,439		)	(103,115		)	(100,813		)	Payments of dividends	(110,893)		(108,439)		(103,115)
Proceeds from issuance of common stock	39,087			21,507			28,779			Proceeds from issuance of common stock	90,022		39,087		21,507
Repurchase of common stock	(50,000		)	(24,410		)	(100,000		)	Repurchase of common stock	(6,540)		(50,000)		(24,410)
Other financing activities	(38,610		)	(49,253		)	(42,277		)	Other financing activities	(89,976)		(38,610)		(49,253)
Net cash provided by (used in) financing activities	(734,892		)	1,794,153			(288,686		)	Net cash provided by (used in) financing activities	2,437,522		(734,892)		1,794,153
Effect of foreign exchange rates on cash and cash equivalents	(8,196		)	(4,524		)	561			Effect of foreign exchange rates on cash and cash equivalents	9,461		(8,196)		(4,524)
Increase (decrease) in cash and cash equivalents	31,618			(23,772		)	86,217			Increase (decrease) in cash and cash equivalents	2,262,545		31,618		(23,772)
Cash and cash equivalents, beginning of period	215,025			238,797			152,580			Cash and cash equivalents, beginning of period	246,643		215,025		238,797
Cash and cash equivalents, end of period	$	246,643		$	215,025		$	238,797		Cash and cash equivalents, end of period	$	2,509,188	$	246,643	$	215,025

The accompanying notes are an integral part of these consolidated financial statements.

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ARAMARK AND SUBSIDIARIES

Fiscal Year

Our fiscal year is the fifty-two or fifty-three week period which ends on the Friday nearest to September 30th. The fiscal year ended October 2, 2020 was a fifty-three week period and the fiscal year ended September 27, 2019 was a fifty-two week period.

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Results of Operations

Fiscal 2020 Compared to Fiscal 2019

The following tables present an overview of our results on a consolidated and segment basis with the amount of and percentage change between periods for the fiscal years 2020 and 2019 (dollars in millions).


	Fiscal Year Ended
	October 2, 2020		September 27, 2019		$		%
Revenue	$	12,829.6	$	16,227.3	$	(3,397.7)	(20.9)	%
Costs and Expenses:
Cost of services provided	11,993.7		14,532.7		(2,539.0)		(17.5)	%
Other operating expenses	902.2		959.7		(57.5)		(6.0)	%
Goodwill impairment	198.6		—		198.6		100.0	%
Gain on sale of Healthcare Technologies	—		(156.3)		156.3		(100.0)	%
	13,094.5		15,336.1		(2,241.6)		(14.6)	%
Operating (loss) income	(264.9)		891.2		(1,156.1)		(129.7)	%
Interest and Other Financing Costs, net	382.8		335.0		47.8		14.3	%
(Loss) Income Before Income Taxes	(647.7)		556.2		(1,203.9)		(216.5)	%
(Benefit) Provision for Income Taxes	(186.3)		107.7		(294.0)		(273.0)	%
Net (loss) income	$	(461.4)	$	448.5	$	(909.9)	(202.9)	%


	Fiscal Year Ended
Revenue by Segment(1)	October 2, 2020		September 27, 2019		$		%
FSS United States	$	7,366.7	$	9,898.6	$	(2,531.9)	(25.6	%)
FSS International	2,945.8		3,742.9		(797.1)		(21.3	%)
Uniform	2,517.1		2,585.8		(68.7)		(2.7	%)
	$	12,829.6	$	16,227.3	$	(3,397.7)	(20.9	%)

	Fiscal Year Ended
Operating Income (Loss) by Segment(1)	October 2, 2020		September 27, 2019		$		%
FSS United States	$	5.3	$	716.8	$	(711.5)	(99.3	%)
FSS International	(344.2)		142.7		(486.9)		***
Uniform	171.5		191.3		(19.8)		(10.4	%)
Corporate	(97.5)		(159.6)		62.1		(38.9	%)
	$	(264.9)	$	891.2	$	(1,156.1)	(129.7	%)

*** Not meaningful

(1) As a percentage of total revenue, FSS United States represented 57.4% and 61.0%, FSS International represented 23.0% and 23.1% and Uniform represented 19.6% and 15.9% for fiscal 2020 and fiscal 2019, respectively. Revenue and operating income (loss) for all segments were impacted by COVID-19 in fiscal 2020.

Consolidated Overview

Revenue decreased by approximately 20.9% during fiscal 2020 compared to the prior year period, which was mainly due to COVID-19, primarily from our clients either reducing or ceasing operations at certain locations across all of our segments. Foreign currency translation also negatively impacted fiscal 2020 (approximately 0.8%). The decrease in revenue was partially offset by the estimated impact of the 53rd week in fiscal 2020 (approximately 1.1%).

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The following table presents the cost of services provided by segment and as a percent of revenue for the fiscal years ended October 2, 2020 and September 27, 2019.


	Fiscal Year Ended
	October 2, 2020				September 27, 2019
Cost of services provided(1)	$		% of Revenue		$		% of Revenue
FSS United States	$	6,889.4	93.5	%	$	8,851.5	89.4	%
FSS International	2,998.4		101.8	%	3,517.1		94.0	%
Uniform	2,105.9		83.7	%	2,164.1		83.7	%
	$	11,993.7	93.5	%	$	14,532.7	89.6	%

The following table presents the percentages attributable to the components in cost of services provided for fiscal 2020 and fiscal 2019.


	Fiscal Year Ended
Cost of services provided components	October 2, 2020		September 27, 2019
Food and support service costs	25.7	%	27.9	%
Personnel costs(1)	49.3	%	46.8	%
Other direct costs	25.0	%	25.3	%
	100.0	%	100.0	%

(1) Severance charges related to COVID-19 increased this percentage by 1.2% during fiscal 2020.

Operating income decreased by approximately $1,156.1 million during fiscal 2020 compared to the prior year period. Operating income was negatively impacted during fiscal 2020 due to COVID-19, primarily attributable to clients either reducing or ceasing operations at certain locations across all of our segments. The negative impact of COVID-19 was partially offset by both U.S. and non-U.S. governmental labor related tax credits (see Note 1 to the audited consolidated financial statements). COVID-19 also led to lower personnel costs and share-based compensation expense (see Note 12 to the audited consolidated financial statements). Personnel costs include employee incentive expenses related to the annual bonus and employer retirement matching contributions. The decrease in operating income during fiscal 2020 was also attributable to:

•non-cash goodwill impairment charge in the FSS International segment (approximately $198.6 million) (see Note 4 to the audited consolidated financial statements);

•the prior year gain from the divestiture of the HCT business (approximately $156.3 million);

•severance charges related to COVID-19 (approximately $145.8 million);

•non-cash charges related to operating lease right-of-use ("ROU") assets, property and equipment and other assets in the FSS United States and FSS International segments, primarily related to client contracts that were reassessed due to the impact of COVID-19 (approximately $30.6 million);

•non-cash charges related to operating lease ROU assets, property and equipment and other assets from disposal by abandonment of certain rental properties in the FSS United States segment (approximately $28.5 million);

•non-cash charges related to information technology assets in the FSS United States segment due to discontinued use and non-renewal or expiration of contracts with specific vendors (approximately $26.1 million); and

•personnel and consulting costs related to sales growth initiatives (approximately $25.8 million).

These decreases in operating income during fiscal 2020 more than offset:

•prior year compensation expenses for employee reinvestments funded by benefits from U.S. tax reform (approximately $73.5 million);

•prior year charges related to certain legal settlements (approximately $29.5 million);

•a gain from the insurance proceeds received related to property damage from a tornado in Nashville in the Uniform segment (approximately $16.3 million);

•the positive impact of foreign currency translation (approximately $15.3 million);

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•lower severance costs related to streamlining initiatives (approximately $15.0 million);

•prior year non-cash impairment charges related to various assets (approximately $14.8 million);

•prior year cash compensation charges related to the retirement of our former chief executive officer (approximately $10.4 million);

•prior year advisory, legal and other professional fees related to the Mantle Ridge Group (approximately $7.7 million); and

•lower merger and integration charges from the Avendra and AmeriPride acquisitions (approximately $7.2 million).

Interest and Other Financing Costs, net, increased 14.3% during fiscal 2020 compared to the prior year period. The increase for fiscal 2020 was primarily due to the issuance of $1,500.0 million of 6.375% Senior Notes, due 2025, the additional borrowings on the revolving credit facility (see Note 5 to the audited consolidated financial statements) and the estimated impact of the 53rd week in fiscal 2020 of approximately $7.3 million, partially offset by lower outstanding term loan borrowings resulting from optional prepayments made during fiscal 2019. Fiscal 2020 includes $20.9 million of net expense related to the refinancing of new term loan borrowings to repay the 5.125% Senior Notes due 2024.

The income tax benefit for fiscal 2020 was recorded at an effective rate of 28.8% compared to income tax expense recorded at an effective rate of 19.4% in the prior year. As a result of the CARES Act, we recorded a net income tax benefit of approximately $58.4 million during fiscal 2020. This benefit reflects the Net Operating Losses ("NOLs") expected to be carried back to Pre-Tax Cut and Jobs Act years, which are benefited at 35.0% as opposed to the current year rate of 21.0%. The effective tax rate for fiscal 2020 also includes an income tax benefit of approximately $46.2 million as a result of an excess tax benefit recognized in relation to equity awards exercised during the fiscal year, including by the former Chairman, President and Chief Executive Officer. We also recorded a valuation allowance against deferred tax assets for cumulative losses in certain subsidiaries of approximately $21.4 million during fiscal 2020, of which $8.6 million was tied to negative evidence related to the $198.6 million non-cash goodwill impairment recorded in the FSS International segment (see Note 4 to the audited consolidated financial statements). The non-cash impairment charge of goodwill for $198.6 million was non-deductible for income tax purposes.

Segment Results

FSS United States Segment

Revenue for each of these sectors is summarized as follows (in millions):


	Fiscal Year Ended				Change
	October 2, 2020		September 27, 2019		%
Business & Industry	$	1,097.3	$	1,587.0	(30.9)	%
Education	2,416.4		3,228.8		(25.2)	%
Healthcare	824.6		933.5		(11.7)	%
Sports, Leisure & Corrections	1,535.8		2,557.5		(39.9)	%
Facilities & Other	1,492.6		1,591.8		(6.2)	%
	$	7,366.7	$	9,898.6	(25.6)	%

The Healthcare sector had high-single digit operating income margins, consistent with prior year. The Education and Facilities & Other sectors had mid-single digit operating income margins, compared to high-single digits in the prior year. The Business & Industry sector had negative mid-single digit operating income margins, compared to mid-single digits in the prior year. The Sports, Leisure & Corrections sector had negative low-single digit operating income margins, compared to mid-single digits in the prior year. As described above, during the COVID-19 pandemic, and in following periods, operating income margins in the FSS United States sectors differ from our historically typical patterns.

FSS United States segment revenue decreased by approximately 25.6% during fiscal 2020 compared to the prior year period. The decrease was primarily attributable to COVID-19, which significantly impacted our Sports, Leisure & Corrections sector due to the suspension of professional sports seasons, our Education sector where clients either have reduced or ceased operations at certain locations and our Business & Industry sector due to many clients working from home instead of the office. During fiscal 2020, revenue also decreased in the Healthcare sector resulting from the divestiture of HCT (approximately 4.3%

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of the Healthcare sector). The decrease in revenue was partially offset by the estimated impact of the 53rd week in fiscal 2020 (approximately 1.2%).

Operating income decreased by approximately $711.5 million during fiscal 2020 compared to the prior year period. Operating income was negatively impacted during fiscal 2020 due to COVID-19, partially offset by labor related tax credits from the CARES Act legislation and lower personnel costs, including lower employee incentive expenses related to the annual bonus and lower employer retirement matching contributions. The profit decline from COVID-19 is primarily attributable to clients either reducing or ceasing operations at certain locations. The decrease during fiscal 2020 was also attributable to:

•the prior year gain from the divestiture of the HCT business (approximately $156.3 million);

•severance charges related to COVID-19 (approximately $51.8 million);

•non-cash charges related to operating lease ROU assets, property and equipment and other assets from disposal by abandonment of certain rental properties (approximately $28.5 million);

•non-cash charges related to information technology assets due to discontinued use and non-renewal or expiration of contracts with specific vendors (approximately $26.1 million);

•personnel costs and consulting costs related to sales growth initiatives (approximately $13.7 million).

These decreases in operating income during fiscal 2020 more than offset:

•prior compensation expenses for employee reinvestments funded by benefits from U.S. tax reform (approximately $57.2 million);

•prior year charges related to certain legal settlements ($12.7 million);

•prior year non-cash impairment charges related to various assets ($11.1 million);

•prior year duplicate rent charges to build out and ready our new headquarters while occupying our previous headquarters, impairment costs while exiting our previous headquarters and moving costs associated with the relocation to the new headquarters (approximately $6.5 million); and

•prior year settlement charges related to exiting a joint venture arrangement (approximately $4.5 million).

FSS International Segment

FSS International segment revenue decreased by approximately 21.3% during fiscal 2020 compared to the prior year period. The decrease was attributable to the negative impact of COVID-19 from government imposed shutdowns. Foreign currency translation also negatively impacted fiscal 2020 revenue (approximately 3.5%).

Operating income decreased by approximately $486.9 million during fiscal 2020 compared to the prior year period. The decrease was attributable to the negative impact of COVID-19, partially offset by labor related tax credits provided from government assistance programs and lower personnel costs, including lower employee incentive expenses related to the annual bonus. The decrease was also attributable to:

•a non-cash goodwill impairment charge (approximately $198.6 million) (see Note 4 to the audited consolidated financial statements);

•severance charges related to COVID-19 (approximately $87.3 million);

•charges related to a client contract dispute (approximately $15.2 million); and

•non-cash charges related to property and equipment from client contracts that were reassessed due to the impact of COVID-19 (approximately $11.2 million).

These decreases in operating income during fiscal 2020 more than offset:

•the positive impact of foreign currency translation (approximately $15.2 million);

•lower severance charges related to streamlining initiatives (approximately $13.4 million); and

•lower closing costs mainly related to customer contracts (approximately $9.5 million).

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Uniform Segment

Operating income decreased by approximately $19.8 million during fiscal 2020 compared to the prior year period. The decrease was attributable to the negative impact of COVID-19, partially offset by labor related tax credits provided by government assistance programs and lower personnel costs, including lower employee incentive expenses related to the annual bonus and lower employer matching contributions. The decrease was also attributable to:

•personnel costs related to sales growth initiatives (approximately $12.1 million); and

•severance charges related to COVID-19 (approximately $4.9 million).

These decreases in operating income during fiscal 2020 more than offset:

•a gain from the insurance proceeds received related to property damage from a tornado in Nashville (approximately $16.3 million);

•lower compensation expenses for employee reinvestments funded by benefits from U.S. tax reform (approximately $14.5 million);

•a favorable non-cash settlement of a multiemployer pension plan obligation (approximately $6.7 million);

•prior year charges related to certain legal settlements (approximately $5.1 million);

•lower merger and integration charges from the AmeriPride acquisition (approximately $5.0 million); and

•prior year non-cash impairment charges (approximately $3.7 million).

Corporate

Corporate expenses, those administrative expenses not allocated to the business segments, decreased by approximately $62.1 million during fiscal 2020 compared to the prior year period, due to lower expenses resulting from the impact of COVID-19, consisting of lower employee incentive expenses related to the annual bonus and lower employer retirement matching contributions, and realignment actions taken by management. The decrease was also attributable to:

•lower share-based compensation expense as a result of COVID-19 from the reduction in the estimated target attainment on plan metrics for fiscal 2018, fiscal 2019 and fiscal 2020 Performance Stock Unit ("PSU") grants (approximately $24.9 million);

•prior year charges related to certain legal settlements (approximately $11.7 million);

•prior year cash compensation charges related to the retirement of our former chief executive officer (approximately $10.4 million);

•prior year advisory, legal and other professional fees related to the Mantle Ridge Group (approximately $7.7 million);

•prior year banker fees related to the divestiture of HCT (approximately $6.1 million);

•the favorable change in fair value of certain gasoline and diesel agreements (approximately $4.2 million); and

•prior year compensation expenses for employee reinvestments funded by benefits from U.S. tax reform (approximately $1.4 million).

These decreases in corporate expenses during fiscal 2020 more than offset severance charges related to COVID-19 (approximately $1.8 million).

Liquidity and Capital Resources

Overview

Our principal sources of liquidity are cash generated from operating activities, funds from borrowings and existing cash on hand. As of October 2, 2020, we had $2,509.2 million of cash and cash equivalents and approximately $80.1 million of availability under our senior secured revolving credit facility. A significant portion of our cash and cash equivalents are held in mature, liquid geographies where we have operations. As of October 2, 2020, there were approximately $937.4 million of outstanding foreign currency borrowings.

On January 15, 2020, we entered into a new U.S. dollar denominated term loan due January 15, 2027 (the "U.S. Term Loan B due 2027"), in an aggregate principal amount of $900.0 million. The U.S. Term Loan B due 2027 was borrowed with an

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In response to the COVID-19 pandemic, we undertook a number of actions to enhance our cash position, including increasing borrowings under our revolving credit facility and under our Receivables Facility. In addition, on April 27, 2020, Aramark Services Inc. (“ASI”), our indirect wholly owned subsidiary, issued $1,500.0 million aggregate principal amount of 6.375% Senior Notes due May 1, 2025 (the "6.375% 2025 Notes"). ASI has used and intends to continue to use the net proceeds from the 6.375% 2025 Notes for general corporate purposes (see Note 5 to the audited consolidated financial statements). On October 30, 2020, we repaid $680.0 million of the outstanding borrowings under the revolving credit facility utilizing cash and cash equivalents and as of such date had approximately $753.9 million of availability under the revolving credit facility. We have also implemented several cost reduction initiatives in response to COVID-19, including renegotiations of client contracts, salary and other compensation adjustments and reductions to general corporate expenses. Beginning in the third quarter of fiscal 2020, we made changes to our organization to align our cost base to better support our clients' needs as we navigate the current environment and focus on our long-term strategy. These actions included headcount reductions, which resulted in severance charges of approximately $145.8 million during fiscal 2020. The majority of these charges are expected to be paid out within the next year.

While the full impact of COVID-19 on our long-term liquidity remains uncertain, we currently believe that our cash and cash equivalents, including funds from the 6.375% 2025 Notes and availability under our revolving credit facility, will be adequate to meet anticipated cash requirements to fund working capital, capital spending, debt service obligations, refinancings, dividends and other cash needs. We have no significant debt maturities due until 2023 and, with the additional funds from the 6.375% 2025 Notes and the covenant relief attained as a result of the credit agreement amendment implemented in April 2020 (see Note 5 to the audited consolidated financial statements), we believe we have sufficient flexibility to manage the impact of COVID-19, based on our current assumptions. We also have flexibility to optimize working capital and defer certain capital expenditures as appropriate without a material impact to the business. We believe that our assumptions used to estimate our liquidity and working capital requirements are reasonable; however, due to the unprecedented current environment, we cannot assure that our assumptions will be correct and, as a consequence, our ability to be predictive is uncertain. For information regarding the impact of COVID-19, including on our liquidity and capital resources, see Part I, Item 1A, "Risk Factors."

The table below summarizes our cash activity (in millions):


	Fiscal Year Ended
	October 2, 2020		September 27, 2019
Net cash provided by operating activities	$	176.7	$	984.2
Net cash used in investing activities	(361.1)		(209.5)
Net cash provided by (used in) financing activities	2,437.5		(734.9)

Reference to the audited Consolidated Statements of Cash Flows will facilitate understanding of the discussion that follows.

Cash Flows Provided by Operating Activities

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•Change in Receivables was a source of cash by $441.5 million in fiscal 2020 compared to a use of cash in fiscal 2019 due to the timing of collections and lower current year revenues from the impact of COVID-19.

Cash Flows Used in Investing Activities

The change in net cash flows used in investing activities during fiscal 2020 compared to fiscal 2019 relates primarily to the proceeds from the sale of the HCT business in the first quarter of fiscal 2019 of $293.7 million and lower levels of capital expenditures. The "Disposals of property and equipment" caption includes approximately $21.5 million of insurance proceeds related to the property damaged from a tornado at one of our Uniform locations in Nashville. The "Proceeds from governmental agencies related to property and equipment" caption includes approximately $15.3 million and $16.2 million of proceeds during fiscal 2020 and 2019, respectively, relating to the recovery of our investment (possessory interest) at one of the National Park Service sites within our Sports, Leisure & Corrections sector. The "Proceeds from governmental agencies related to property and equipment" caption also includes approximately $8.3 million and $6.8 million during fiscal 2020 and fiscal 2019, respectively, of proceeds from government grants related to the relocation to our new headquarters in the prior year.

Cash Flows Provided by (Used In) Financing Activities

During fiscal 2020, cash provided by financing activities was impacted by the following:

•issuance of 6.375% senior unsecured notes due 2025 ($1,500.0 million);

•issuance of a new U.S. denominated term loan due January 2027, net of original issue discount ($898.9 million);

•an increase in borrowings under the revolving credit facility ($849.9 million);

•an increase in funding under the Receivables Facility ($315.6 million);

•an increase in proceeds from issuance of common stock as a result of higher stock option exercises ($90.0 million); and

•repayment of the aggregate principal amount of the 2024 Notes ($900.0 million); and

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•payment of fees and expenses related to refinancing activities, which is included in "Other financing activities," including a call premium ($23.1 million) and debt issuance costs ($29.4 million).

During fiscal 2019, cash used in financing activities was impacted by $500.0 million of optional prepayments on term loans borrowings, of which $200.0 million was from the proceeds of the HCT divestiture.

During fiscal 2019, the Board of Directors authorized a new share repurchase program providing for purchases up to $200.0 million of Aramark common stock through July 2022. During the second quarter of fiscal 2020, we repurchased 0.3 million shares of our common stock for $6.5 million under this program. In accordance with Amendment No. 9 to the Credit Agreement entered into in the third quarter of fiscal 2020, we cannot make any future share repurchases as long as the covenant compliance waiver remains in effect (see below). During fiscal 2019, we completed a repurchase of 1.6 million shares of our common stock for $50.0 million under a previously authorized 2017 share repurchase program, which expired on February 1, 2019.

The "Other financing activities" caption also reflects a use of cash during fiscal 2020 and fiscal 2019, primarily related to taxes paid by us when we withhold shares upon an employee's exercise or vesting of equity awards to cover income taxes.

We intend to continue to pay cash dividends on our common stock, subject to our compliance with applicable law, and depending on, among other things, our results of operations, financial condition, level of indebtedness, capital requirements, contractual restrictions, restrictions in our debt agreements, business prospects and other factors that our Board of Directors may deem relevant. However, the payment of any future dividends will be at the discretion of our Board of Directors and our Board of Directors may, at any time, determine not to continue to declare quarterly dividends. In accordance with Amendment No. 9 to the Credit Agreement entered into in the third quarter of fiscal 2020, we have limitations on the amount of dividends allowed to be paid as long as the covenant compliance waiver remains in effect (see below).

Covenant Compliance

The Credit Agreement contains a number of covenants that, among other things, restrict, subject to certain exceptions, our ability and the ability of our subsidiaries to: incur additional indebtedness; issue preferred stock or provide guarantees; create liens on assets; engage in mergers or consolidations; sell assets; pay dividends, make distributions or repurchase our capital stock; make investments, loans or advances; repay or repurchase any subordinated debt, except as scheduled or at maturity; create restrictions on the payment of dividends or other amounts to us from our restricted subsidiaries; make certain acquisitions; engage in certain transactions with affiliates; amend material agreements governing our subordinated debt (or any indebtedness that refinances our subordinated debt); and fundamentally change our business. The indentures governing our senior notes contain similar provisions. As of October 2, 2020, we were in compliance with these covenants.

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These financial ratios, tests and covenants involve the calculation of certain measures that we refer to in this discussion as "Covenant Adjusted EBITDA." Covenant Adjusted EBITDA is not a measurement of financial performance under U.S. GAAP. Covenant Adjusted EBITDA is defined as net income (loss) of ASI and its restricted subsidiaries plus interest and other financing costs, net, provision (benefit) for income taxes, and depreciation and amortization, further adjusted to give effect to adjustments required in calculating covenant ratios and compliance under our Credit Agreement and the indentures governing our senior notes.

The following is a reconciliation of net (loss) income attributable to ASI stockholder, which is a U.S. GAAP measure of ASI''s operating results, to Covenant Adjusted EBITDA as defined in our debt agreements. The terms and related calculations are defined in the Credit Agreement and the indentures governing our senior notes. Covenant Adjusted EBITDA is a measure of ASI and its restricted subsidiaries only and does not include the results of Aramark.


	Fiscal Year Ended
(in millions)	October 2, 2020		September 27, 2019
Net (loss) income attributable to ASI stockholder	$	(461.5)	$	448.5
Interest and other financing costs, net	382.8		335.0
(Benefit) Provision for income taxes	(186.3)		107.7
Depreciation and amortization	595.2		592.6
Share-based compensation expense(1)	30.3		55.3
Unusual or non-recurring (gains) and losses(2)	198.6		(156.3)
Pro forma EBITDA for equity method investees(3)	10.1		8.1
Pro forma EBITDA for certain transactions(4)	6.3		21.5
Other(5)	490.6		253.5
Covenant Adjusted EBITDA	$	1,066.1	$	1,665.9

(1) Represents share-based compensation expense resulting from the application of accounting for stock options, restricted stock units, performance stock units and deferred stock unit awards (see Note 12 to the audited consolidated financial statements).

(4) Represents the annualizing of net EBITDA from acquisitions and divestitures made during the period.

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Our covenant requirement and actual ratio for the fiscal year ended October 2, 2020 is as follows(1):


	Covenant Requirements	Actual Ratios

Interest Coverage Ratio (Fixed Charge Coverage Ratio)(2)	2.000x	2.58x

(1) The covenant waiver period for the Consolidated Secured Debt Ratio covenant is in effect for the fourth quarter of fiscal 2020 through the third quarter of fiscal 2021.

Subject to restrictions imposed upon us during the covenant waiver period in accordance with Amendment No. 9 to the Credit Agreement, we and our subsidiaries and affiliates may from time to time, in our sole discretion, purchase, repay, redeem or retire any of our outstanding debt securities (including any publicly issued debt securities), in privately negotiated or open market transactions, by tender offer or otherwise, or extend or refinance any of our outstanding indebtedness.

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The following table summarizes our future obligations for debt repayments, finance leases, estimated interest payments, future minimum rental and similar commitments under noncancelable operating leases as well as contingent obligations related to outstanding letters of credit and guarantees as of October 2, 2020 (dollars in thousands):


	Payments Due by Period
Contractual Obligations as of October 2, 2020	Total		Less than 1 year		1-3 years		3-5 years		More than 5 years
Long-term borrowings(1)(2)	$	9,198,187	$	69,932	$	469,173	$	6,158,580	$	2,500,502
Finance lease obligations	157,329		31,290		45,208		31,668		49,163
Estimated interest payments(2)(3)	1,676,600		359,700		663,700		478,600		174,600
Operating leases and other noncancelable commitments	476,602		85,005		123,831		82,990		184,776
Purchase obligations(4)	816,125		306,984		241,569		70,164		197,408
Other liabilities(5)	365,200		76,600		78,500		13,000		197,100
	$	12,690,043	$	929,511	$	1,621,981	$	6,835,002	$	3,303,549

	Amount of Commitment Expiration by Period
Other Commercial Commitments as of October 2, 2020	Total Amounts Committed		Less than 1 year		1-3 years		3-5 years		More than 5 years
Letters of credit	$	191,667	$	191,667	$	—	$	—	$	—

(1)Excludes the $61.3 million reduction to long-term borrowings from debt issuance costs and $1.0 million reduction from the discount on the U.S. Term Loan B due 2027.

(2)Reflects outstanding debt balances as of October 2, 2020 and does not reflect the October 30, 2020 repayment of $680.0 million of outstanding borrowings under the revolving credit facility.

(3)These amounts represent future interest payments related to our existing debt obligations based on fixed and variable interest rates specified in the associated debt agreements and reflect any current hedging arrangements. Payments related to variable debt are based on applicable rates at October 2, 2020 plus the specified margin in the associated debt agreements for each period presented. The amounts provided relate only to existing debt obligations and do not assume the refinancing or replacement of such debt. The average debt balance for each fiscal year from 2021 through 2026 is $9,291.3 million, $9,111.7 million, $8,783.4 million, $7,299.7 million, $4,792.2 million and $2,364.1 million, respectively. The weighted average interest rate of our existing debt obligations for each fiscal year from 2021 through 2026 is 3.87%, 3.84%, 3.57%, 3.92%, 4.02% and 3.78%, respectively (see Note 5 to the audited consolidated financial statements for the terms and maturities of existing debt obligations).

(4)Represents commitments for capital projects to help finance improvements or renovations at the facilities in which we operate.

(5)Includes certain unfunded employee retirement obligations, CEO retirement and severance related obligations.

We have excluded from the table above uncertain tax liabilities due to the uncertainty of the amount and period of payment. As of October 2, 2020, we have gross uncertain tax liabilities of $34.6 million (see Note 10 to the audited consolidated financial statements). During fiscal 2020, we made contributions totaling $4.2 million into our defined benefit pension plans and benefit payments of $16.7 million out of these plans. Estimated contributions to our defined benefit pension plans in fiscal 2021 are $3.4 million and estimated benefit payments out of these plans in fiscal 2021 are $224.3 million (see Note 9 to the audited consolidated financial statements).

We have an agreement (the "Receivables Facility") with three financial institutions where we sell on a continuous basis an undivided interest in all eligible accounts receivable, as defined in the Receivables Facility. The maximum amount available under the Receivables Facility is $400.0 million. In addition, the Receivables Facility includes a seasonal tranche which increases the capacity of the Receivables Facility and the maximum amount available by $100.0 million from October through March. During the third quarter of fiscal 2020, we extended the scheduled maturity date of the Receivables Facility from May 2021 to June 2022. All other terms and conditions of the agreement remained largely unchanged (see Note 5 to the audited consolidated financial statements). As of October 2, 2020 the amount of outstanding borrowings under the Receivables Facility was $315.6 million. Amounts borrowed under the Receivables Facility fluctuate monthly based on our funding requirements and the level of qualified receivables available to collateralize the Receivables Facility.

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certain of our subsidiaries. Under the Receivables Facility, we and certain of our subsidiaries transfer without recourse all of our accounts receivable to ARAMARK Receivables, LLC. As collections reduce previously transferred interests, interests in new, eligible receivables are transferred to ARAMARK Receivables, LLC, subject to meeting certain conditions.

Our business activities do not include the use of unconsolidated special purpose entities and there are no significant business transactions that have not been reflected in the accompanying financial statements. Beginning in fiscal 2019, we began insuring portions of our general liability, automobile liability and workers’ compensation risks through a wholly owned captive insurance subsidiary (the "Captive") to enhance our risk financing strategies. The Captive is subject to regulations within its domicile of Bermuda, including regulations established by the Bermuda Monetary Authority (the "BMA") relating to levels of liquidity and solvency as such concepts are defined by the BMA. The Captive was in compliance with these regulations as of October 2, 2020. These regulations may have the effect of limiting our ability to access certain cash and cash equivalents held by the Captive for uses other than for the payment of our general liability, automobile liability and workers’ compensation claims and related Captive costs. As of October 2, 2020, cash and cash equivalents at the Captive was $92.1 million.

On January 29, 2020, our stockholders approved the Second Amended and Restated 2013 Stock Incentive Plan, which amends and restates our 2013 Incentive Plan. The Second Amended and Restated 2013 Stock Incentive Plan provides for up to 7.5 million of new shares authorized for issuance to participants, in addition to the shares that remained available for issuance under the 2013 Incentive Plan as of January 29, 2020 that are not subject to outstanding awards under the 2013 Incentive Plan.

Supplemental Consolidating Information

Pursuant to Regulation S-X Rule 13-01, which simplifies certain disclosure requirements for guarantors and issuers of guaranteed securities, and which we have early adopted, we are no longer required to provide condensed consolidating financial statements for Aramark and its subsidiaries, including the guarantors and non-guarantors under our Credit Agreement and the indentures governing our senior notes. ASI, the borrower under our Credit Agreement and the indentures governing our senior notes, and its restricted subsidiaries together comprise substantially all of our assets, liabilities and operations, and there are no material differences between the consolidating information related to Aramark and Aramark Intermediate Holdco Corporation, the direct parent of ASI and a guarantor under our Credit Agreement, on the one hand, and ASI and its restricted subsidiaries on a standalone basis, on the other hand.

Critical Accounting Policies and Estimates

Asset Impairment Determinations

Goodwill, the Aramark trade name and other trade names are primarily indefinite lived intangible assets that are not amortized and are subject to an impairment test that we conduct annually or more frequently if a change in circumstances or the occurrence of events indicates that potential impairment exists. The impairment test may first consider qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. Examples of qualitative factors include, macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, entity-specific events, events affecting reporting units and sustained changes in our stock price. If results of the qualitative assessment indicate a more likely than not determination or if a qualitative assessment is not performed, a quantitative test is performed by comparing the estimated fair value using discounted cash flow calculations of each reporting unit with its estimated net book value.

We perform the assessment of goodwill at the reporting unit level. Within our FSS International segment, each country or region is evaluated separately since they are relatively autonomous and separate goodwill balances have been recorded for each entity. During the fourth quarter of fiscal 2020, we performed the annual impairment test for goodwill for each of our reporting units using a quantitative testing approach. Based on our evaluation performed, we determined that it was more likely than not that the fair value of each of the reporting units exceeded its respective carrying amount, and therefore, we determined that goodwill was not impaired.

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performed, we determined that goodwill was not impaired for all but one reporting unit, as the fair value of each reporting unit substantially exceeded its respective carrying amount. The one reporting unit within the FSS International segment for which goodwill was determined to be impaired had also been tested for impairment using the quantitative approach during our previous annual impairment test completed as of August 23, 2019. The reporting unit had a fair value that exceeded its carrying value by approximately 22% as of that date. As of March 27, 2020, the quantitative impairment test for this same reporting unit resulted in a fair value that was approximately 34% lower than its carrying value, which was driven most notably by the changes in underlying assumptions used for impairment calculation purposes, including the discount rate as well as the near term growth outlook of the reporting unit pre-COVID-19. As a result, we recognized a non-cash impairment charge of $198.6 million in the Consolidated Statements of (Loss) Income for the fiscal year ended October 2, 2020. For tax purposes, the impairment charge is not tax deductible. The impaired reporting unit has a remaining goodwill balance of $90.1 million as of October 2, 2020.

In making future cash flow analyses of various assets, we make assumptions relating to the following:

• The intended use of assets and the expected future cash flows resulting directly from such use;

• Comparable market valuations of businesses similar to Aramark's business segments;

• Industry specific economic conditions;

• Competitor activities and regulatory initiatives; and

• Client and customer preferences and behavior patterns.

During fiscal 2020, we recorded non-cash impairment charges related to the following: abandonment of rental properties ($28.5 million), information technology assets from either discontinue of use or contracts terminated ($26.1 million) and from client contracts that were reassessed due to the impact of COVID-19 ($30.6 million). For fiscal 2019, we recorded non-cash impairment charges of approximately $14.8 million.

Litigation and Claims

• interpretation of contractual rights and obligations;

• the status of government regulatory initiatives, interpretations and investigations;

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• the status of settlement negotiations;

• prior experience with similar types of claims;

• whether there is available insurance; and

• advice of counsel.

During fiscal 2019, we recorded approximately $27.9 million of expenses related to certain legal settlements.

Allowance for Doubtful Accounts

As of October 2, 2020 and September 27, 2019, our allowance for doubtful accounts was approximately $74.9 million and $49.6 million, respectively. The increase in the allowance for doubtful accounts during fiscal 2020 reflects the continued economic uncertainty resulting from COVID-19.

Inventory Obsolescence

As of October 2, 2020 and September 27, 2019, our reserve for inventory obsolescence was approximately $36.7 million and $23.6 million, respectively.

Self-Insurance Reserves

We self-insure for certain obligations related to our employee health care benefit programs, as well as for certain risks that we retain under our general liability, automobile liability and workers’ compensation liability programs. Our reserves are estimated through actuarialmethods, with the assistance of third-party actuaries, using loss development assumptions based on our claims history. The accounting estimates related to our self-insurance reserves are critical accounting estimates because changes in our claim experience, our ability to settle claims or other estimates and judgments we use could potentially have a material impact on our results of operations.

As of October 2, 2020 and September 27, 2019, our self-insurance reserves were approximately $250.1 million and $238.9 million, respectively.

Income Taxes

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New Accounting Standards Updates

See Note 1 to the audited consolidated financial statements for a full description of recent accounting standards updates, including the expected dates of adoption.

Item 7A. Quantitative and Qualitative Disclosure About Market Risk

We are exposed to the impact of interest rate changes and manage this exposure through the use of variable-rate and fixed-rate debt and by utilizing interest rate swaps. We do not enter into contracts for trading purposes and do not use leveraged instruments. The information below summarizes our market risks associated with debt obligations and other significant financial instruments as of October 2, 2020 (see Notes 5 and 6 to the audited consolidated financial statements). Fair values were computed using market quotes, if available, or based on discounted cash flows using market interest rates as of the end of the respective periods. For debt obligations, the table presents principal cash flows and related interest rates by contractual fiscal year of maturity. Variable interest rates disclosed represent the weighted-average rates of the portfolio at October 2, 2020. For interest rate swaps, the table presents the notional amounts and related weighted-average interest rates by fiscal year of maturity. The variable rates presented are the average forward rates for the term of each contract.


	(US$ equivalent in millions)
	Expected Fiscal Year of Maturity
As of October 2, 2020	2021			2022				2023			2024				2025			Thereafter			Total			Fair Value
Debt:
Fixed rate	$	31		$	25			$	20		$	17			$	2,495		$	1,700		$	4,288		$	4,351
Average interest rate	4.2		%	4.2		%		4.2		%	4.2		%		5.5		%	4.9		%	5.3		%
Variable rate	$	70		$	379		(a)	$	90		$	2,002		(b)	$	1,676		$	850		$	5,067		$	4,909
Average interest rate	3.9		%	1.9		%		1.9		%	1.9		%		1.9		%	1.9		%	1.9		%
Interest Rate Swaps:
Receive variable/pay fixed	$	329		$	250			$	1,550		$	—			$	800		$	—		$	2,929		$	(118)
Average pay rate	1.9		%	2.6		%		2.1		%	—		%		1.6		%	—		%
Average receive rate	0.1		%	0.1		%		0.1		%	—		%		0.1		%	—		%

(a)As of October 2, 2020, the amount of outstanding borrowings under the Receivables Facility was $315.6 million.

(b)Reflects outstanding debt balances as of October 2, 2020 and does not reflect the October 30, 2020 repayment of $680.0 million of outstanding borrowings under the revolving credit facility.

As of October 2, 2020, we had foreign currency forward exchange contracts outstanding with nominal notional amounts to mitigate the risk of changes in foreign currency exchange rates on short-term intercompany loans to certain international subsidiaries. As of October 2, 2020, the fair value of these foreign exchange contracts is $0.1 million, which is included in "Accounts Payable" in our Consolidated Balance Sheets.

We entered into a series of pay fixed/receive floating gasoline and diesel fuel agreements based on the Department of Energy weekly retail on-highway index in order to limit its exposure to price fluctuations for gasoline and diesel fuel. As of October 2, 2020, we had contracts for approximately 11.1 million gallons outstanding through fiscal 2021. As of October 2, 2020, the fair value of our gasoline and diesel fuel hedge agreements is $1.8 million, which is included in "Accounts Payable" in our Consolidated Balance Sheets.

Item 8. Financial Statements and Supplementary Data

See Financial Statements and Schedule beginning on page S-1.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Not applicable.

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Item 9A. Controls and Procedures

(a) Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as that term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) as of the end of the period covered by this report. Based on that evaluation, management, with the participation of our Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures, as of the end of the period covered by this report, are functioning effectively to provide reasonable assurance that the information required to be disclosed by us in reports filed under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and is accumulated and communicated to our management, including our principal executive and principal financial officers, to allow timely decisions regarding required disclosures. A controls system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the controls system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.

(b) Management’s Annual Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rule 13a-15(f) of the Exchange Act. Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based upon criteria established in Internal Control – Integrated Framework (2013) by the Committee of Sponsoring Organizations of the Treadway Commission. Based on that evaluation, our management concluded that our internal control over financial reporting was effective as of October 2, 2020. The effectiveness of our internal control over financial reporting as of October 2, 2020 has been audited by KPMG LLP, our independent registered public accounting firm, as stated in their report that is included herein on the following page.

No change in our internal control over financial reporting occurred during our fourth quarter of fiscal 2020 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors

Aramark:

Opinion on Internal Control Over Financial Reporting

We have audited Aramark and subsidiaries’ (the Company) internal control over financial reporting as of October 2, 2020, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of October 2, 2020, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of October 2, 2020 and September 27, 2019, the related consolidated statements of (loss) income, comprehensive (loss) income, cash flows, and stockholders’ equity for each of the fiscal years ended October 2, 2020, September 27, 2019 and September 28, 2018, and the related notes and financial statement schedule II (collectively, the consolidated financial statements), and our report dated November 24, 2020 expressed an unqualified opinion on those consolidated financial statements.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

Definition and Limitations of Internal Control Over Financial Reporting

/s/ KPMG LLP

Philadelphia, Pennsylvania

November 24, 2020

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Item 9B. Other Information

Not applicable.

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PART III

Item 10. Directors, Executive Officers and Corporate Governance

Information about our directors and persons nominated to become directors required by Item 10 will be included under the caption "Proposal No. 1 - Election of Directors" in our Proxy Statement for the 2021 Annual Meeting of Stockholders and is incorporated herein by reference. Information about our executive officers is included under the caption “Information About Our Executive Officers” in Part I of this report and incorporated herein.

Information on beneficial ownership reporting required by Item 10, if any, will be included under the caption "Delinquent Section 16(a) Reports" in our Proxy Statement for the 2021 Annual Meeting of Stockholders and is incorporated herein by reference.

The remaining information required by Item 10 will be included under the caption "Board Committees and Meetings" in our Proxy Statement for the 2021 Annual Meeting of Stockholders and is incorporated herein by reference.

Item 11. Executive Compensation

Information required by Item 11 will be included under the caption "Compensation Matters" in our Proxy Statement for the 2021 Annual Meeting of Stockholders and is incorporated herein by reference.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Information required by Item 12 will be included under the captions "Security Ownership of Certain Beneficial Owners and Management" and "Equity Compensation Plan Information" in our Proxy Statement for the 2021 Annual Meeting of Stockholders and is incorporated herein by reference.

Item 13. Certain Relationships and Related Transactions, and Director Independence

Information required by Item 13 will be included under the captions "Certain Relationships and Related Transactions" and "Director Independence and Independence Determinations" in our Proxy Statement for the 2021 Annual Meeting of Stockholders and is incorporated herein by reference.

Item 14. Principal Accountant Fees and Services

Information required by Item 14 will be included under the caption "Fees to Independent Registered Public Accounting Firm" in our Proxy Statement for the 2021 Annual Meeting of Stockholders and is incorporated herein by reference.

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PART IV

Item 15. Exhibits and Financial Statement Schedules

(a) Financial Statements

See Index to Financial Statements and Schedule at page S-1 and the Exhibit Index.

(b) Exhibits Required by Item 601 of Regulation S-K

See the Exhibit Index which is incorporated herein by reference.

See Index to Financial Statements and Schedule at page S-1.

Item 16. Form 10-K Summary

None.

SIGNATURES

Aramark

By:

/s/ THOMAS G. ONDROF

Name:

Thomas G. Ondrof

Title:

Executive Vice President and Chief Financial Officer


Name						Capacity

/s/ JOHN J. ZILLMER						Chief Executive Officer and Director
John J. Zillmer						(Principal Executive Officer)

/s/ THOMAS G. ONDROF						Executive Vice President and Chief Financial Officer
Thomas G. Ondrof						(Principal Financial Officer and Principal Accounting Officer)

/s/ SUSAN CAMERON						Director
Susan Cameron

/s/ GREG CREED						Director
Greg Creed

/s/ CALVIN DARDEN						Director
Calvin Darden

/s/ RICHARD W. DREILING						Director
Richard W. Dreiling

/s/ IRENE M. ESTEVES						Director
Irene M. Esteves

/s/ DANIEL J. HEINRICH						Director
Daniel J. Heinrich

/s/ PAUL HILAL						Vice Chairman, Director
Paul Hilal

/s/ KAREN KING						Director
Karen King

/s/ STEPHEN I. SADOVE						Chairman, Director
Stephen I. Sadove

/s/ ART WINKLEBLACK						Director
Art Winkleblack

Table of Contents

ARAMARK AND SUBSIDIARIES

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULE


									Page
Report of Independent Registered Public Accounting Firm									S-2
Consolidated Balance Sheets as of October 2, 2020 and September 27, 2019									S-4
Consolidated Statements of (Loss) Income for the fiscal years ended October 2, 2020, September 27, 2019 and September 28, 2018									S-5
Consolidated Statements of Comprehensive (Loss) Income for the fiscal years ended October 2, 2020, September 27, 2019 and September 28, 2018									S-6
Consolidated Statements of Cash Flows for the fiscal years ended October 2, 2020, September 27, 2019 and September 28, 2018									S-7
Consolidated Statements of Stockholders' Equity for the fiscal years ended October 2, 2020, September 27, 2019 and September 28, 2018									S-8
Notes to Consolidated Financial Statements									S-9
Schedule II—Valuation and Qualifying Accounts and Reserves for the fiscal years ended October 2, 2020, September 27, 2019 and September 28, 2018									S-53

S-1

Table of Contents

Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors

Aramark:

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of Aramark and subsidiaries (the Company) as of October 2, 2020 and September 27, 2019, the related consolidated statements of (loss) income, comprehensive (loss) income, cash flows, and stockholders’ equity for each of the fiscal years ended October 2, 2020, September 27, 2019 and September 28, 2018 and the related notes and financial statement schedule II (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of October 2, 2020 and September 27, 2019, and the results of its operations and its cash flows for each of the fiscal years ended October 2, 2020, September 27, 2019 and September 28, 2018, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of October 2, 2020, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated November 24, 2020, expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.

Change in Accounting Principle

Basis for Opinion

Critical Audit Matter

Impairment of goodwill recorded in one reporting unit in the FSS International segment

As discussed in Note 4 to the consolidated financial statements, the Company performs goodwill impairment testing on an annual basis and whenever events and changes in circumstances indicate that the carrying value of a reporting unit might exceed its fair value. During the second quarter of fiscal year 2020, the Company performed an interim quantitative goodwill impairment test. Based on the evaluation performed, the Company determined that goodwill was not impaired for all but one reporting unit within the FSS International segment. The reporting unit recognized an

S-2

Table of Contents

impairment charge of $198.6 million for the year ended October 2, 2020 and has a remaining goodwill balance of $90.1 million at the fiscal year end.

We identified the impairment of goodwill recorded for that reporting unit as a critical audit matter. Significant auditor judgment was required to evaluate the Company’s determination of the fair value of the reporting unit used in the Company’s impairment test, which was performed using a discounted cash flow model and included assumptions related to the terminal year revenue growth rate, earnings before interest and tax margin projections, and the discount rate. We performed a sensitivity analysis to determine that these were the assumptions that could cause significant change in the determination of the fair value of the reporting unit.

The following are the primary procedures performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s goodwill impairment process. This included controls related to the determination of the Company’s terminal year revenue growth rate, earnings before interest and tax margin projections, and the discount rate applied to the projected cash flows. We evaluated the Company’s terminal year revenue growth rate and earnings before interest and tax margin projections by comparing to external market and industry data. We compared the Company’s historical cash flow forecasts to the corresponding actual results to assess the Company’s ability to reasonably forecast. We assessed the impact and likelihood of the plans to improve the operating results of certain underperforming client contracts by comparing the assumptions to the Company’s past performance of similar actions. We involved a valuation professional with specialized skills and knowledge, who assisted in:

/s/ KPMG LLP

We have served as the Company's auditor since 2002.

Philadelphia, Pennsylvania

November 24, 2020

S-3

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ARAMARK AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

OCTOBER 2, 2020 AND SEPTEMBER 27, 2019

(in thousands, except share amounts)


	October 2, 2020		September 27, 2019
ASSETS
Current Assets:
Cash and cash equivalents	$	2,509,188	$	246,643
Receivables (less allowances: 2020 - $74,925; 2019 - $49,566)	1,431,206		1,806,964
Inventories	436,473		411,319
Prepayments and other current assets	298,944		193,461
Total current assets	4,675,811		2,658,387
Property and Equipment, at cost:
Land, buildings and improvements	929,354		947,522
Service equipment and fixtures	4,184,603		3,993,014
	5,113,957		4,940,536
Less - Accumulated depreciation	(3,063,049)		(2,758,774)
	2,050,908		2,181,762
Goodwill	5,343,828		5,518,800
Other Intangible Assets	1,932,637		2,033,566
Operating Lease Right-of-use Assets (see Note 8)	551,394		0
Other Assets	1,158,106		1,343,806
	$	15,712,684	$	13,736,321
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current maturities of long-term borrowings	$	99,915	$	69,928
Current operating lease liabilities (see Note 8)	71,810		0
Accounts payable	663,455		999,517
Accrued payroll and related expenses	572,076		509,617
Accrued expenses and other current liabilities	940,202		1,126,236
Total current liabilities	2,347,458		2,705,298
Long-Term Borrowings	9,178,508		6,612,239
Noncurrent Operating Lease Liabilities (see Note 8)	341,667		0
Deferred Income Taxes and Other Noncurrent Liabilities	1,099,075		1,088,822
Redeemable Noncontrolling Interest	9,988		9,915
Stockholders' Equity:
Common stock, par value $0.01 (authorized: 600,000,000 shares; issued: 2020—290,663,529 shares and 2019—282,919,536; and outstanding: 2020—253,042,169 shares and 2019—247,756,091 shares)	2,907		2,829
Capital surplus	3,416,132		3,236,450
Retained earnings	532,379		1,107,029
Accumulated other comprehensive loss	(307,258)		(216,965)
Treasury stock (shares held in treasury: 2020—37,621,360 shares and 2019—35,163,445 shares)	(908,172)		(809,296)
Total stockholders' equity	2,735,988		3,320,047
	$	15,712,684	$	13,736,321

The accompanying notes are an integral part of these consolidated financial statements.

S-4

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ARAMARK AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF ~~STOCKHOLDERS' EQUITY~~(LOSS) INCOME

FOR THE FISCAL YEARS ENDED OCTOBER 2, 2020, SEPTEMBER 27, 2019 AND SEPTEMBER 28, 2018 ~~AND SEPTEMBER 29, 2017~~

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

Total Stockholders' Equity Common Stock Capital Surplus Retained Earnings / (Accumulated Deficit) Accumulated Other Comprehensive Loss Treasury Stock
Balance, September 30, 2016 $ 2,161,006
$ 2,726
$ 2,921,725
$ (33,778 ) $ (180,783 ) $ (548,884 )
Adoption of new accounting standard 1,129
(8,013 ) 9,142

Net income attributable to Aramark stockholders 373,923
373,923

Other comprehensive income 57,023
57,023

Capital contributions from issuance of common stock 35,724
45
35,679

Share-based compensation expense 65,155
65,155

Repurchases of common stock (132,662 ) (132,662 )
Payments of dividends (102,237 ) (102,237 )
Balance, September 29, 2017 $ 2,459,061
$ 2,771
$ 3,014,546
$ 247,050
$ (123,760 ) $ (681,546 )
Net income attributable to Aramark stockholders 567,885
567,885

Other comprehensive income 32,537
32,537

Capital contributions from issuance of common stock 29,621
22
29,599

Share-based compensation expense 88,276
88,276

Repurchases of common stock (43,406 ) (43,406 )
Payments of dividends (104,416 ) (104,416 )
Balance, September 28, 2018 $ 3,029,558
$ 2,793
$ 3,132,421
$ 710,519
$ (91,223 ) $ (724,952 )
Adoption of new accounting standard 58,395
58,395

Net income attributable to Aramark stockholders 448,549
448,549

Other comprehensive loss (125,742 ) (125,742 )
Capital contributions from issuance of common stock 48,785
36
48,749

Share-based compensation expense 55,280
55,280

Repurchases of common stock (84,344 ) (84,344 )
Payments of dividends (110,434 ) (110,434 )
Balance, September 27, 2019 $ 3,320,047
$ 2,829
$ 3,236,450
$ 1,107,029
$ (216,965 ) $ (809,296 )


	Fiscal Year Ended
	October 2, 2020		September 27, 2019		September 28, 2018
Revenue	$	12,829,559	$	16,227,341	$	15,789,633
Costs and Expenses:
Cost of services provided	11,993,667		14,532,662		13,997,911
Depreciation and amortization	595,195		592,573		596,182
Selling and general corporate expenses	307,016		367,256		377,129
Goodwill impairment	198,600		0		0
Gain on sale of Healthcare Technologies	0		(156,309)		0
	13,094,478		15,336,182		14,971,222
Operating (loss) income	(264,919)		891,159		818,411
Interest and Other Financing Costs, net	382,800		334,987		346,535
(Loss) Income Before Income Taxes	(647,719)		556,172		471,876
(Benefit) Provision for Income Taxes	(186,284)		107,706		(96,564)
Net (loss) income	(461,435)		448,466		568,440
Less: Net income (loss) attributable to noncontrolling interest	94		(83)		555
Net (loss) income attributable to Aramark stockholders	$	(461,529)	$	448,549	$	567,885

(Loss) Earnings per share attributable to Aramark stockholders:
Basic	$	(1.83)	$	1.82	$	2.31
Diluted	$	(1.83)	$	1.78	$	2.24
Weighted Average Shares Outstanding:
Basic	251,828		246,854		245,771
Diluted	251,828		252,010		253,352

The accompanying notes are an integral part of these consolidated financial statements.

~~S-8~~

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ARAMARK AND SUBSIDIARIES

~~NOTES TO~~ CONSOLIDATED ~~FINANCIAL~~ STATEMENTS

OF COMPREHENSIVE (LOSS) INCOME

FOR THE FISCAL YEARS ENDED OCTOBER 2, 2020, SEPTEMBER 27, 2019 AND SEPTEMBER 28, 2018

(in thousands)

~~NOTE 1. NATURE OF BUSINESS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:~~


	Fiscal Year Ended
	October 2, 2020		September 27, 2019		September 28, 2018
Net (loss) income	$	(461,435)	$	448,466	$	568,440
Other comprehensive (loss) income, net of tax:
Pension plan adjustments	(25,669)		(22,594)		20,647
Foreign currency translation adjustments	(7,818)		(34,308)		(31,253)
Cash flow hedges:
Unrealized (losses) gains arising during the period	(82,005)		(62,450)		39,311
Reclassification adjustments	25,463		(4,798)		3,675
Share of equity investee's comprehensive (loss) income	(264)		(1,592)		157
Other comprehensive (loss) income, net of tax	(90,293)		(125,742)		32,537
Comprehensive (loss) income	(551,728)		322,724		600,977
Less: Net income (loss) attributable to noncontrolling interest	94		(83)		555
Comprehensive (loss) income attributable to Aramark stockholders	$	(551,822)	$	322,807	$	600,422

Aramark (the "Company") is a leading global provider of food, facilities and uniform services to education, healthcare, business & industry, and sports, leisure & corrections clients. The Company's core market is the United States, which is supplemented by an additional 18-country footprint. The Company operates its business in 3 reportable segments that share many of the same operating characteristics:

Food and Support Services United States ("FSS United States") - Food, refreshment, specialized dietary and support services, including facility maintenance and housekeeping, provided to business, educational and healthcare institutions and in sports, leisure and other facilities.

Food and Support Services International ("FSS International") - Food, refreshment, specialized dietary and support services, including facility maintenance and housekeeping, provided to business, educational and healthcare institutions and in sports, leisure and other facilities.

Uniform and Career Apparel ("Uniform") - Provides a full service employee uniform solution, including design, sourcing and manufacturing, delivery, cleaning and maintenance on a contract basis. Directly markets personalized uniforms and accessories, provides managed restroom services and rents uniforms, work clothing, outerwear, particulate-free garments and non-garment items and related services, including mats, shop towels and first aid supplies, to clients in a wide range of industries in the United States, Puerto Rico, Canada and through a joint venture in Japan, including the manufacturing, transportation, construction, restaurant and hotel, healthcare and pharmaceutical industries.

The accompanying notes are an integral part of these consolidated financial ~~statements include the accounts~~statements.

S-6

Table of ~~the Company and all~~Contents

ARAMARK AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE FISCAL YEARS ENDED OCTOBER 2, 2020, SEPTEMBER 27, 2019 AND SEPTEMBER 28, 2018

(in thousands)


	Fiscal Year Ended
	October 2, 2020		September 27, 2019		September 28, 2018
Cash flows from operating activities:
Net (loss) income	$	(461,435)	$	448,466	$	568,440
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization	595,195		592,573		596,182
Goodwill impairment and asset write-downs	283,743		0		0
Deferred income taxes	(134,048)		40,503		(104,289)
Share-based compensation expense	30,339		55,280		88,276
Net gain on sale of Healthcare Technologies	0		(139,165)		0
Changes in operating assets and liabilities:
Accounts Receivable	362,708		(78,771)		(45,891)
Inventories	(25,675)		(49,732)		(40,187)
Prepayments and Other Current Assets	(86,444)		(37,854)		42,450
Accounts Payable	(342,069)		17,680		26,658
Accrued Expenses	(143,640)		193,532		(111,386)
Payments made to clients on contracts	(69,575)		(40,073)		0
Changes in other noncurrent liabilities	92,782		18,904		1,576
Changes in other assets	66,650		(41,436)		(2,225)
Other operating activities	8,151		4,320		32,271
Net cash provided by operating activities	176,682		984,227		1,051,875
Cash flows from investing activities:
Purchases of property and equipment and other	(418,508)		(503,090)		(628,604)
Disposals of property and equipment	54,074		17,871		10,491
Proceeds from divestitures	0		293,711		0
Acquisition of certain businesses, net of cash acquired
Working capital other than cash acquired	(3,081)		10,634		37,985
Property and equipment	(1,264)		(3,320)		(283,447)
Additions to goodwill, other intangible assets and other assets, net	(17,856)		(52,177)		(1,994,822)
Proceeds from governmental agencies related to property and equipment	23,550		23,025		0
Other investing activities	1,965		3,825		(6,879)
Net cash used in investing activities	(361,120)		(209,521)		(2,865,276)
Cash flows from financing activities:
Proceeds from long-term borrowings	3,239,772		77,630		3,177,313
Payments of long-term borrowings	(1,000,463)		(654,560)		(973,689)
Net change in funding under the Receivables Facility	315,600		0		(254,200)
Payments of dividends	(110,893)		(108,439)		(103,115)
Proceeds from issuance of common stock	90,022		39,087		21,507
Repurchase of common stock	(6,540)		(50,000)		(24,410)
Other financing activities	(89,976)		(38,610)		(49,253)
Net cash provided by (used in) financing activities	2,437,522		(734,892)		1,794,153
Effect of foreign exchange rates on cash and cash equivalents	9,461		(8,196)		(4,524)
Increase (decrease) in cash and cash equivalents	2,262,545		31,618		(23,772)
Cash and cash equivalents, beginning of period	246,643		215,025		238,797
Cash and cash equivalents, end of period	$	2,509,188	$	246,643	$	215,025

The accompanying notes are an integral part of ~~its subsidiaries in which a controlling~~these consolidated financial ~~interest is maintained in accordance with generally accepted accounting principles in the United States ("U.S. GAAP"). All significant intercompany transactions and accounts have been eliminated.~~statements.

S-7

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ARAMARK AND SUBSIDIARIES

Fiscal Year

Table o f Content s

Results of Operations

Fiscal 2020 Compared to Fiscal 2019


	Fiscal Year Ended
	October 2, 2020		September 27, 2019		$		%
Revenue	$	12,829.6	$	16,227.3	$	(3,397.7)	(20.9)	%
Costs and Expenses:
Cost of services provided	11,993.7		14,532.7		(2,539.0)		(17.5)	%
Other operating expenses	902.2		959.7		(57.5)		(6.0)	%
Goodwill impairment	198.6		—		198.6		100.0	%
Gain on sale of Healthcare Technologies	—		(156.3)		156.3		(100.0)	%
	13,094.5		15,336.1		(2,241.6)		(14.6)	%
Operating (loss) income	(264.9)		891.2		(1,156.1)		(129.7)	%
Interest and Other Financing Costs, net	382.8		335.0		47.8		14.3	%
(Loss) Income Before Income Taxes	(647.7)		556.2		(1,203.9)		(216.5)	%
(Benefit) Provision for Income Taxes	(186.3)		107.7		(294.0)		(273.0)	%
Net (loss) income	$	(461.4)	$	448.5	$	(909.9)	(202.9)	%


	Fiscal Year Ended
Revenue by Segment(1)	October 2, 2020		September 27, 2019		$		%
FSS United States	$	7,366.7	$	9,898.6	$	(2,531.9)	(25.6	%)
FSS International	2,945.8		3,742.9		(797.1)		(21.3	%)
Uniform	2,517.1		2,585.8		(68.7)		(2.7	%)
	$	12,829.6	$	16,227.3	$	(3,397.7)	(20.9	%)

	Fiscal Year Ended
Operating Income (Loss) by Segment(1)	October 2, 2020		September 27, 2019		$		%
FSS United States	$	5.3	$	716.8	$	(711.5)	(99.3	%)
FSS International	(344.2)		142.7		(486.9)		***
Uniform	171.5		191.3		(19.8)		(10.4	%)
Corporate	(97.5)		(159.6)		62.1		(38.9	%)
	$	(264.9)	$	891.2	$	(1,156.1)	(129.7	%)

*** Not meaningful

Consolidated Overview

Table o f Content s

The following table presents the cost of services provided by segment and as a percent of revenue for the fiscal years ended October 2, 2020 and September 27, 2019.


	Fiscal Year Ended
	October 2, 2020				September 27, 2019
Cost of services provided(1)	$		% of Revenue		$		% of Revenue
FSS United States	$	6,889.4	93.5	%	$	8,851.5	89.4	%
FSS International	2,998.4		101.8	%	3,517.1		94.0	%
Uniform	2,105.9		83.7	%	2,164.1		83.7	%
	$	11,993.7	93.5	%	$	14,532.7	89.6	%

The following table presents the percentages attributable to the components in cost of services provided for fiscal 2020 and fiscal 2019.


	Fiscal Year Ended
Cost of services provided components	October 2, 2020		September 27, 2019
Food and support service costs	25.7	%	27.9	%
Personnel costs(1)	49.3	%	46.8	%
Other direct costs	25.0	%	25.3	%
	100.0	%	100.0	%