UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON,Washington, D.C. 20549

FORM 10-Q

(Mark One)
x☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2017March 31, 2023
OR
or
¨☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to

Commission File NumberNumber: 1-11442

CHART INDUSTRIES, INC.
(Exact Namename of Registrantregistrant as Specifiedspecified in its Charter)

charter)
Delaware34-1712937
(State or Other Jurisdictionother jurisdiction of
Incorporation incorporation or Organization)
organization)
(I.R.S. Employer
Identification No.)
3055 Torrington2200 Airport Industrial Drive, Suite 100, Ball Ground, Georgia 30107
(Address of Principal Executive Offices)principal executive offices) (ZIP Code)
(770) 721-8800
(Registrant’s Telephone Number, Including Area Code)Registrant's telephone number, including area code)
NOT APPLICABLE
(Former Name, Former Addressname, former address and Former Fiscal Year,former fiscal year, if Changed Since Last Report)changed since last report)

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, par value $0.01GTLSNew York Stock Exchange
Depositary shares, each representing 1/20th interest in a share of 6.75% Series B Mandatory Convertible Preferred Stock, par value $0.01GTLS.PRBNew York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this Chapter)chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).     Yes  x   No  ¨o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerxAccelerated filer¨☐
Non-accelerated filer¨(Do not check if a smaller reporting company)☐Smaller reporting company¨☐
Emerging growth company¨☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).     Yes  ¨☐     No  x
At October 23, 2017,
As of May 1, 2023, there were 30,771,07442,727,377 outstanding shares of the Company’s Common Stock,common stock, par value $0.01 per share.




CHART INDUSTRIES, INC.
INDEX
 
Item 1. Financial Statements
Page
Condensed Consolidated Balance Sheets as of September 30, 2017 and December 31, 2016
3
Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income for the Three and Nine Months Ended September 30, 2017 and 2016
45
Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2017 and 2016
57
Condensed Consolidated Statements of Equity
9
Notes to the Unaudited Condensed Consolidated Financial Statements
610
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
2645
Item 3. Quantitative and Qualitative Disclosures About Market Risk
3955
Item 4. Controls and Procedures
3956
Item 1. Legal Proceedings
58
Item 1A. Risk Factors
4158
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
4158
Item 4. Mine Safety Disclosures
4158
Item 5. Other Information
58
Item 6. Exhibits
4259
Signatures
4360


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PART I. FINANCIAL INFORMATION


Item 1.Financial Statements
Item 1.Financial Statements
CHART INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(Dollars in thousands,millions, except per share amounts)
March 31,
2023		December 31,
2022
ASSETS
Current Assets
Cash and cash equivalents$166.9 $663.6 
Restricted cash2.5 1,941.7 
Accounts receivable, less allowances of $4.7 and $4.5, respectively747.1 278.4 
Inventories, net601.8 357.9 
Unbilled contract revenue392.6 133.7 
Prepaid expenses104.0 37.5 
Insurance receivable— 234.4 
Other current assets148.4 43.7 
Total Current Assets2,163.3 3,690.9 
Property, plant, and equipment, net727.2 430.0 
Goodwill2,933.2 992.0 
Identifiable intangible assets, net3,105.8 535.3 
Equity method investments104.7 93.0 
Investments in equity securities94.6 96.5 
Other assets120.0 64.2 
TOTAL ASSETS$9,248.8 $5,901.9 
LIABILITIES AND EQUITY
Current Liabilities
Accounts payable$670.1 $211.1 
Customer advances and billings in excess of contract revenue453.5 170.6 
Accrued salaries, wages, and benefits90.4 31.5 
Accrued income taxes35.1 3.5 
Current portion of warranty reserve32.3 4.1 
Current portion of long-term debt273.4 256.9 
Operating lease liabilities, current14.3 5.4 
Accrued legal settlement— 305.6 
Other current liabilities163.5 92.9 
Total Current Liabilities1,732.6 1,081.6 
Long-term debt4,051.6 2,039.8 
Long-term deferred tax liabilities656.9 46.1 
Accrued pension liabilities7.1 0.9 
Operating lease liabilities, non-current52.0 15.6 
Other long-term liabilities41.7 33.6 
Total Liabilities6,541.9 3,217.6 
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 September 30,
2017		 December 31,
2016
 (Unaudited)  
ASSETS   
Current Assets   
Cash and cash equivalents$124,658
 $281,959
Accounts receivable, less allowances of $10,349 and $10,217195,785
 142,762
Inventories, net213,590
 169,683
Unbilled contract revenue41,378
 26,736
Prepaid expenses15,982
 16,762
Other current assets30,808
 15,075
Total Current Assets622,201
 652,977
Property, plant, and equipment, net293,145
 251,049
Goodwill457,481
 217,970
Identifiable intangible assets, net298,878
 93,443
Other assets21,318
 17,643
TOTAL ASSETS$1,693,023
 $1,233,082
LIABILITIES AND EQUITY   
Current Liabilities   
Accounts payable$109,939
 $79,953
Customer advances and billings in excess of contract revenue100,696
 74,702
Accrued salaries, wages, and benefits45,237
 41,746
Current portion of warranty reserve13,151
 15,293
Short-term debt and current portion of long-term debt244,330
 6,487
Other current liabilities37,102
 43,353
Total Current Liabilities550,455
 261,534
Long-term debt304,012
 233,711
Long-term deferred tax liabilities74,136
 4,241
Long-term portion of warranty reserve2,504
 2,978
Accrued pension liabilities10,896
 14,362
Other long-term liabilities18,612
 17,579
Total Liabilities960,615
 534,405
    
Equity   
Common stock, par value $0.01 per share – 150,000,000 shares authorized, 30,767,789 and 30,613,166 shares issued and outstanding at September 30, 2017 and December 31, 2016, respectively308
 306
Additional paid-in capital404,502
 395,843
Retained earnings337,709
 336,328
Accumulated other comprehensive loss(12,712) (35,212)
Total Chart Industries, Inc. Shareholders’ Equity729,807
 697,265
Noncontrolling interests2,601
 1,412
Total Equity732,408
 698,677
TOTAL LIABILITIES AND EQUITY$1,693,023
 $1,233,082
The balance sheet at December 31, 2016 has been derived from the audited financial statements at that date, but does not include all of the information and notes required by U.S. generally accepted accounting principles for complete financial statements.

March 31,
2023		December 31,
2022
Equity
Preferred stock, par value $0.01 per share, $1,000 aggregate liquidation preference — 10,000,000 shares authorized, 402,500 and 402,500 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively— — 
Common stock, par value $0.01 per share – 150,000,000 shares authorized, 42,725,897 and 42,563,032 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively0.4 0.4 
Additional paid-in capital1,863.4 1,850.2 
Treasury stock; 760,782 shares at both March 31, 2023 and December 31, 2022(19.3)(19.3)
Retained earnings880.1 902.2 
Accumulated other comprehensive loss(53.9)(58.0)
Total Chart Industries, Inc. Shareholders’ Equity2,670.7 2,675.5 
Noncontrolling interests36.2 8.8 
Total Equity2,706.9 2,684.3 
TOTAL LIABILITIES AND EQUITY$9,248.8 $5,901.9 
See accompanying notes to these unaudited condensed consolidated financial statements.

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CHART INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME
(UNAUDITED)
(Dollars and shares in thousands,millions, except per share amounts)
 Three Months Ended March 31,
 20232022
Sales$537.9 $354.1 
Cost of sales386.4 270.4 
Gross profit151.5 83.7 
Selling, general, and administrative expenses93.5 53.5 
Amortization expense21.8 10.1 
Operating expenses115.3 63.6 
Operating income36.2 20.1 
Acquisition related finance fees26.1 — 
Interest expense, net25.5 3.2 
Financing costs amortization2.8 0.7 
Unrealized loss on investments in equity securities2.0 2.6 
Foreign currency (gain) loss(1.1)1.6 
Other expense (income)0.8 (0.7)
(Loss) income from continuing operations before income taxes and equity in loss of unconsolidated affiliates, net(19.9)12.7 
Income tax (benefit) expense(6.4)2.1 
(Loss) income from continuing operations before equity in loss of unconsolidated affiliates, net(13.5)10.6 
Equity in loss of unconsolidated affiliates, net(0.4)(0.3)
Net (loss) income from continuing operations(13.9)10.3 
Loss from discontinued operations, net of tax(0.4)— 
Net (loss) income(14.3)10.3 
Less: Income attributable to noncontrolling interests of continuing operations, net of taxes0.7 0.1 
Net (loss) income attributable to Chart Industries, Inc.$(15.0)$10.2 
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 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Sales$240,531
 $203,930
 $682,839
 $644,782
Cost of sales170,129
 134,307
 493,562
 435,507
Gross profit70,402
 69,623
 189,277
 209,275
Selling, general, and administrative expenses56,714
 45,430
 159,346
 143,862
Amortization expense3,240
 2,912
 9,301
 9,156
Asset impairments—
 1,217
 —
 1,217
Operating expenses59,954
 49,559
 168,647
 154,235
Operating income10,448
 20,064
 20,630
 55,040
Other expenses:       
Interest expense, net4,828
 4,291
 13,045
 12,556
Financing costs amortization321
 321
 963
 963
Foreign currency loss1,286
 4
 1,790
 117
Other expenses, net6,435
 4,616
 15,798
 13,636
Income before income taxes4,013
 15,448
 4,832
 41,404
Income tax expense1,907
 1,764
 2,346
 12,829
Net income2,106
 13,684
 2,486
 28,575
Less: Income (loss) attributable to noncontrolling interests, net of taxes596
 (1,341) 1,105
 (2,952)
Net income attributable to Chart Industries, Inc.$1,510
 $15,025
 $1,381
 $31,527
Net income attributable to Chart Industries, Inc. per common share:       
Basic$0.05
 $0.49
 $0.04
 $1.03
Diluted$0.05
 $0.48
 $0.04
 $1.02
Weighted-average number of common shares outstanding:       
Basic30,755
 30,585
 30,726
 30,578
Diluted31,311
 31,064
 31,288
 30,940
        
Comprehensive income, net of taxes$10,331
 $13,932
 $25,070
 $29,235
Less: Comprehensive income (loss) attributable to noncontrolling interests, net of taxes641
 (1,364) 1,189
 (3,069)
Comprehensive income attributable to Chart Industries, Inc., net of taxes$9,690
 $15,296
 $23,881
 $32,304

 Three Months Ended March 31,
 20232022
Amounts attributable to Chart common stockholders
(Loss) income from continuing operations$(14.6)$10.2 
Less: Mandatory convertible preferred stock dividend requirement6.8 — 
(Loss) income from continuing operations attributable to Chart(21.4)10.2 
Loss from discontinued operations, net of tax(0.4)— 
Net (loss) income attributable to Chart common stockholders$(21.8)$10.2 
Basic earnings per common share attributable to Chart Industries, Inc.
(Loss) income from continuing operations$(0.51)$0.28 
Loss from discontinued operations(0.01)— 
Net (loss) income attributable to Chart Industries, Inc.$(0.52)$0.28 
Diluted earnings per common share attributable to Chart Industries, Inc.
(Loss) income from continuing operations$(0.51)$0.25 
Loss from discontinued operations(0.01)— 
Net (loss) income attributable to Chart Industries, Inc.$(0.52)$0.25 
Weighted-average number of common shares outstanding:
Basic41.94 35.83 
Diluted41.94 40.79 
Comprehensive (loss) income, net of taxes$(10.2)$4.3 
Less: Comprehensive income attributable to noncontrolling interests, net of taxes0.7 0.1 
Comprehensive (loss) income attributable to Chart Industries, Inc., net of taxes$(10.9)$4.2 
See accompanying notes to these unaudited condensed consolidated financial statements.

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CHART INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(Dollars in thousands)millions)
 Three Months Ended March 31,
 20232022
OPERATING ACTIVITIES
Net (loss) income$(14.3)$10.3 
Adjustments to reconcile net income to net cash provided by operating activities:
Bridge loan facility fees26.1 — 
Depreciation and amortization33.3 20.5 
Employee share-based compensation expense4.0 3.3 
Financing costs amortization2.8 0.7 
Unrealized foreign currency transaction gain1.7 (1.1)
Unrealized loss on investments in equity securities2.0 2.6 
Equity in loss of unconsolidated affiliates0.5 0.3 
Other non-cash operating activities0.1 2.0 
Changes in assets and liabilities, net of acquisitions:
Accounts receivable(6.6)(17.2)
Inventories10.4 (35.0)
Unbilled contract revenues and other assets174.9 (36.1)
Accounts payable and other liabilities(273.8)(3.5)
Customer advances and billings in excess of contract revenue6.8 31.0 
Net Cash Used In Operating Activities(32.1)(22.2)
INVESTING ACTIVITIES
Acquisition of businesses, net of cash acquired(4,339.8)(0.8)
Investments(2.1)(3.9)
Capital expenditures(31.4)(12.6)
Proceeds from sale of assets0.1 — 
Government grants and other(0.6)(0.2)
Net Cash Used In Investing Activities(4,373.8)(17.5)
FINANCING ACTIVITIES
Borrowings on revolving credit facility634.8 254.0 
Repayments on revolving credit facility(45.0)(235.9)
Borrowings on term loan1,497.2 — 
Payments for debt issuance costs(121.5)— 
Proceeds from issuance of common stock, net11.7 — 
Proceeds from exercise of stock options0.1 1.0 
Common stock repurchases from share-based compensation plans(2.6)(3.2)
Dividends paid on mandatory convertible preferred stock(6.9)— 
Net Cash Provided By Financing Activities1,967.8 15.9 
Effect of exchange rate changes on cash and cash equivalents2.2 1.3 
Net increase in cash, cash equivalents, restricted cash, and restricted cash equivalents(2,435.9)(22.5)
Cash, cash equivalents, restricted cash, and restricted cash equivalents at beginning of period2,605.3 122.4 
CASH, CASH EQUIVALENTS, RESTRICTED CASH, AND RESTRICTED CASH EQUIVALENTS AT END OF PERIOD (1)(2)
$169.4 $99.9 
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 Nine Months Ended September 30,
 2017 2016
OPERATING ACTIVITIES   
Net income$2,486
 $28,575
Adjustments to reconcile net income to net cash provided by operating activities:   
Depreciation and amortization28,659
 28,605
Asset impairments—
 1,217
Interest accretion of convertible notes discount10,027
 9,268
Employee share-based compensation expense9,555
 9,014
Financing costs amortization963
 963
Unrealized foreign currency transaction loss215
 318
Other non-cash operating activities975
 (390)
Changes in assets and liabilities, net of acquisitions:   
Accounts receivable(10,311) 55,706
Inventory(19,264) 16,246
Unbilled contract revenues and other assets(8,431) 38,721
Accounts payable and other liabilities(4,824) (43,393)
Customer advances and billings in excess of contract revenue7,487
 1,742
Net Cash Provided By Operating Activities17,537
 146,592
INVESTING ACTIVITIES   
Capital expenditures(23,407) (13,411)
Proceeds from sale of assets925
 —
Government grants407
 1,055
Acquisition of businesses, net of cash acquired(446,004) (1,383)
Net Cash Used In Investing Activities(468,079) (13,739)
FINANCING ACTIVITIES   
Borrowings on revolving credit facilities302,176
 3,820
Repayments on revolving credit facilities(5,097) (6,061)
Borrowings on term loan—
 13,167
Repayments on term loan—
 (1,508)
Proceeds from exercise of options1,057
 26
Excess tax benefits from share-based compensation—
 54
Common stock repurchases(1,954) (658)
Net Cash Provided By Financing Activities296,182
 8,840
Effect of exchange rate changes on cash4,854
 1,875
Net (decrease) increase in cash, cash equivalents, restricted cash, and restricted cash equivalents(149,506) 143,568
Cash, cash equivalents, restricted cash, and restricted cash equivalents at beginning of period282,949
 123,708
CASH, CASH EQUIVALENTS, RESTRICTED CASH, AND RESTRICTED CASH EQUIVALENTS AT END OF PERIOD(1)
$133,443
 $267,276
(1)Includes restricted cash and restricted cash equivalents of $2.5 and $1,941.7 classified within restricted cash as of March 31, 2023 and December 31, 2022, respectively. For further information regarding restricted cash and restricted cash equivalents balances, refer to Note 9, “Debt and Credit Arrangements.”
_______________(2)Net cash used in operating activities includes net out-of-pocket payments in connection with settlements related to our divested cryobiological products business. For further information regarding our discontinued operations, refer to Note 2, “Discontinued Operations.”
(1)
Refer to the Debt and Credit Arrangements and Business Combinations notes for further information regarding restricted cash and restricted cash equivalents balances.
See accompanying notes to these unaudited condensed consolidated financial statements.

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CHART INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (UNAUDITED)
(Dollars in millions)
Common StockPreferred StockAdditional Paid-in CapitalAccumulated Other Comprehensive
Loss		Non-controlling Interests
 Shares
Outstanding		AmountShares
Outstanding		AmountTreasury StockRetained
Earnings		Total
Equity
Balance at December 31, 202242.56 $0.4 0.40 $— $1,850.2 $(19.3)$902.2 $(58.0)$8.8 $2,684.3 
Net income— — — — — — (15.0)— 0.7 (14.3)
Other comprehensive loss— — — — — — — 4.0 — 4.0 
Common stock issuance, net of equity issuance costs0.11 — — — 11.7 — — — — 11.7 
Share-based compensation expense— — — — 4.0 — — — — 4.0 
Common stock issued from share-based compensation plans0.08 — — — 0.1 — — — — 0.1 
Common stock repurchases from share-based compensation plans(0.02)— — — (2.6)— — — — (2.6)
Preferred stock dividend— — — — — — (6.9)— — (6.9)
Purchase of non-controlling interest— — — — — — — — 26.5 26.5 
Other— — — — (0.2)0.1 0.2 0.1 
Balance at March 31, 202342.73 $0.4 0.4 $— $1,863.4 $(19.3)$880.1 $(53.9)$36.2 $2,706.9 

 Common StockPreferred StockAdditional Paid-in CapitalAccumulated Other Comprehensive Income (Loss)Non-controlling Interests
 Shares
Outstanding		AmountShares
Outstanding		AmountTreasury StockRetained
Earnings		Total
Equity
Balance at December 31, 202136.55 $0.4 — $— $779.0 $(19.3)$878.2 $(21.7)$8.6 $1,625.2 
Net income— — — — — — 10.2 — 0.1 10.3 
Other comprehensive loss— — — — — — — (6.0)— (6.0)
Share-based compensation expense— — — — 3.3 — — — — 3.3 
Common stock issued from share-based compensation plans0.08 — — — 1.0 — — — — 1.0 
Common stock repurchases from share-based compensation plans(0.02)— — — (3.2)— — — — (3.2)
Earthly Labs Inc. purchase price adjustment— — — — (1.2)— — — — (1.2)
Balance at March 31, 202236.61 $0.4 — $— $778.9 $(19.3)$888.4 $(27.7)$8.7 $1,629.4 
_______________
(1)Refer to Note 2, “Significant Accounting Policies” included in our Annual Report on Form 10-K for the year ended December 31, 2021 for discussion regarding the cumulative effect of change in accounting principle.
See accompanying notes to these unaudited condensed consolidated financial statements.
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CHART INDUSTRIES, INC. AND SUBSIDIARIES
Notes to the Unaudited Condensed Consolidated Financial Statements – September 30, 2017March 31, 2023
(Dollars and shares in thousands,millions, except per share amounts)



NOTE 1 — Basis of Preparation
The accompanying unaudited condensed consolidated financial statements of Chart Industries, Inc. and its consolidated subsidiaries (the “Company”(herein referred to as the “Company,” “Chart,” “we,” “us,” or “Chart”“our”) have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principlesGAAP for annual financial statements. These financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’sour Annual Report on Form 10-K for the year ended December 31, 2016.2022. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and nine months ended September 30, 2017March 31, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017.2023.
On March 17, 2023, we completed the acquisition of Howden (“Howden”), a leading global provider of mission critical air and gas handling products and services, from affiliates of KPS Capital Partners, LP, which is included in our continuing operations for the two weeks of ownership during March 2023. See Note 13, “Business Combinations”, for further information regarding the acquisition of Howden (the “Howden Acquisition”).
Nature of Operations: Chart Industries, Inc.We are a leading independent global leader in the design, engineering, and its consolidated subsidiaries (herein referred to asmanufacturing of process technologies and equipment for gas and liquid molecule handling for the “Company,” “Chart,” or “we”),Nexus of Clean™ – clean power, clean water, clean food, and clean industrials, regardless of molecule. Our unique product portfolio across both stationary and rotating equipment is used in every phase of the liquid gas supply chain, including upfront engineering, service and repair. Being at the forefront of the clean energy transition, Chart is a leading diversified global manufacturerprovider of highly engineered equipment for the industrial gas, energy and biomedical industries. Chart’stechnology, equipment and engineered systemsservices related to liquefied natural gas, hydrogen, biogas, CO2 Capture and water treatment, among other applications. We are primarily usedcommitted to excellence in environmental, social and corporate governance (ESG) issues both for low-temperature and cryogenic applications utilizing our expertise in cryogenic systems and equipment which operate at low temperatures sometimes approaching absolute zero (0 Kelvin; -273° Centigrade; -459° Fahrenheit). The Company has domestic operations located acrosscompany as well as our customers. With over 48 global manufacturing locations from the United States including principal executive offices located in Georgia,to Asia, India and an international presence in Asia, Australia, Europe, Mexicowe maintain accountability and South America.transparency to our team members, suppliers, customers and communities.
Principles of Consolidation: The unaudited condensed consolidated financial statements include the accounts of the CompanyChart Industries, Inc. and its subsidiaries. Intercompany accounts and transactions are eliminated in consolidation.
Reclassifications: Certain total assets by operating segments and restructuring activities as reported in 2016 were reclassified to conform to the 2017 presentation within the notes to the condensed consolidated financial statements.
Use of Estimates:The preparation of financial statements in conformity with U.S. generally accepted accounting principlesGAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements. These estimates may also affect the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and assumptions.assumptions, based on a number of factors including the current macroeconomic conditions such as inflation and supply chain disruptions, as well as risks set forth in our Annual Report on Form 10-K.
Cash, Cash Equivalents, Restricted Cash, and Restricted Cash Equivalents: The Company considers all investments with an initial maturity of three months or less when purchased to be cash equivalents. See the Debt and Credit Arrangements notefor additional information about restricted cash and restricted cash equivalents, which is included in other current assets and other assets in the accompanying condensed consolidated balance sheets.
Recently Issued Accounting Standards: Standards (Not Yet Adopted): In August 2017,June 2022, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-12, “Derivatives and Hedging2022-03, “Fair Value Measurement (Topic 815)820): Targeted ImprovementsFair Value Measurement of Equity Securities Subject to Accounting for Hedging Activities.Contractual Sale Restrictions.” The ASU expandsamendments in this update clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the security and, enhances hedge accountingtherefore, is not considered in measuring fair value. The amendments also clarify that an entity cannot recognize and measure a contractual sale restriction and adds additional disclosures for equity securities subject to become more closely aligned with an entity’s risk management activities through hedging strategies.contractual sale restrictions. The ASU provides changes to both the designation and measurement guidanceamendments in this update are effective for qualifying hedging relationships and the presentation of hedge results in the financial statements and creates more transparency and better understandability around how economic results are presented in the financial statements. In addition, the new guidance makes certain targeted improvements to ease the application of accounting guidance relative to hedge effectiveness. The guidance will be applied prospectively for annual periods and interim periodsfiscal years beginning after December 15, 2018. Early adoption is permitted. The Company is currently assessing the effect that the2023, including interim periods within those fiscal years. We do not expect this ASU willto have a material impact on the Company’sour financial position, results of operations, and disclosures.
Recently Adopted Accounting Standards: In May 2017,March 2022, the FASB issued ASU 2017-09, “Compensation – Stock Compensation2022-02, “Financial Instruments—Credit Losses (Topic 718)326): ScopeTroubled Debt Restructurings and Vintage Disclosures.” For public business entities, the amendments in this update require that an entity disclose current-period gross writeoffs by year of Modification Accounting.origination for financing receivables and net investments in leases within the scope of Subtopic 326-20. The amendments in this update were effective for Chart for fiscal years beginning after December 15, 2022. We adopted this guidance effective January 1, 2023. The adoption of this guidance did not have a material impact on our financial position, results of operations or disclosures.
In November 2021, the FASB issued ASU 2021-10, “Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance.” The FASB issued the guidance to provide clarity as to when modification accounting should be applied when there isamendments in this update require annual disclosures about transactions with a change to the terms or conditions of a share-based payment award in order to prevent diversity in practice. The ASU requires modification accounting to be applied unless all of the following conditions exist: (1) the fair value (or calculated value or intrinsic value, if such measurement is used) of the modified award is the same as the fair value (or calculated value or intrinsic value, if such measurement is used) of the original award before the original award is modified; if the modification does not affect any of the inputs to the valuation, the entity is not required to estimate the value immediately before and after the modification; (2) the vesting conditions of the modified award are the same as the vesting conditions of the original award before it was modified; and (3) the classification of the modified award as an equity instrument or a liability instrument is the same as the classification of the original award before it was modified. The guidance will be applied prospectively for annual periods and interim periods beginning

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Notes to the Unaudited Condensed Consolidated Financial Statements – September 30, 2017March 31, 2023
(Dollars and shares in thousands,millions, except per share amounts) – Continued





government that are accounted for by applying a grant or contribution model by analogy. The amendments in this update are effective for all entities within their scope for financial statements issued for annual periods beginning after December 15, 2017.2021. Early adoptionapplication of the amendments is permitted. We adopted this guidance effective January 1, 2022. The Company is currently assessing the effect that the ASU willadoption of this guidance did not have a material impact on the Company’sour financial position, results of operations andor disclosures.
In March 2017,October 2021, the FASB issued ASU 2017-07, “Compensation – Retirement Benefits2021-08, “Business Combinations (Topic 715)805): Improving the Presentation of Net Periodic Pension CostAccounting for Contract Assets and Net Periodic Postretirement Benefit Cost.Contract Liabilities from Contracts with Customers.” The new guidance requires companiesamendments in this update require that an entity (acquirer) recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with sponsored defined benefit pension and/or other postretirement benefit plans to presentTopic 606. For public business entities, the service cost component of net periodic benefit costamendments in the same income statement line item as other compensation costs. The other components of net periodic benefit cost will be presented separately and not included in operating income. In addition, only service coststhis update are eligible to be capitalized as an asset. The standard will be effective for fiscal years beginning after December 15, 2017,2022, including interim periods within those years, and thefiscal years. We adopted this guidance will generally be applied retrospectively, whereas the capitalizationeffective April 1, 2022. The adoption of the service cost component will be applied prospectively. Early adoption is permitted with all of the amendments adopted in the same period. If an entity early adopts thethis guidance in an interim period, any adjustments must be reflected as of the beginning of the fiscal year that includes that interim period. The Company is currently assessing the effect that the ASU willdid not have a material impact on the Company’sour financial position, results of operations andor disclosures.
In January 2017,March 2020, the FASB issued ASU 2017-04, “Intangibles – Goodwill and Other2020-04, “Reference Rate Reform (Topic 350): Simplifying the Test for Goodwill Impairment.” The new guidance eliminates the requirement to calculate the implied fair value of goodwill (Step 2848), Facilitation of the current guidance’s goodwill impairment test) to measure a goodwill impairment charge. Instead, entities will record an impairment charge basedEffects of Reference Rate Reform on the excess of a reporting unit’s carrying amount over its fair value (i.e., measure the charge based on current guidance’s Step 1). The guidance will be applied prospectively for annualFinancial Reporting,” and interim impairment tests beginning after December 15, 2019. Early adoption is permitted for annual and interim goodwill impairment testing dates afterin January 1, 2017. The adoption of this ASU would not materially impact the Company’s condensed consolidated financial statements unless Step 1 of the annual goodwill impairment test fails.
In August 2016,2021, the FASB subsequently issued ASU 2016-15, “Statement of Cash Flows2021-01, “Reference Rate Reform (Topic 230)848): Classification of Certain Cash Receipts and Cash Payments.Scope.” The FASB issued the update to clarify how entities should classify certain cash receipts and cash payments on the statement of cash flows. The new guidance also clarifies how the predominance principle should be applied when cash receipts and cash payments have aspects of more than one class of cash flows. The standard will be effective for fiscal years beginning after December 15, 2017, including interim periods within those years, and the guidance will generally be applied retrospectively. Early adoption is permitted with all of the amendments adopted in the same period. If an entity early adopts the guidance in an interim period, any adjustments must be reflected as of the beginning of the fiscal year that includes that interim period. The Company is currently assessing the effect that the ASU will have on the Company’s condensed consolidated statements of cash flows.
In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” The FASB issued the update to require the recognition of lease assets and lease liabilities on the balance sheet of lessees. The standard will be effective for fiscal years beginning after December 15, 2018, including interim periods within such fiscal years. The ASU requires a modified retrospective transition method with the option to elect a package of practical expedients. Early adoption is permitted. The Company expects adoption to increase the assets and liabilities recorded on its condensed consolidated balance sheet and increase the level of disclosures related to leases. The Company also expects that adoption of the new standard will require changes to its internal controls to support recognition and disclosure requirements under the new standard. The Company is currently assessing the effect that the ASU will have on the Company’s condensed consolidated financial statements.
In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)” and subsequently issued additional guidance that modified ASU 2014-09. ASU 2014-092020-04 and the subsequent modifications are identified as “Accounting Standards CodificationASC 848 (“ASC”) 606.” ASC 606 replaces existing revenue recognition rules with a comprehensive revenue measurement848”). ASC 848 simplifies the accounting for modifying contracts (including those in hedging relationships) that refer to LIBOR and recognition standard and provides for expanded disclosure requirements. The update requires entities to recognize revenue to depict the transfer of promised goods or services to customers in an amountother interbank offered rates that reflects the consideration to which the entity expectsare expected to be entitleddiscontinued due to reference rate reform. The amendments in exchangeASC 848 are effective for those goodsall entities as of March 12, 2020 through December 31, 2022. An entity may elect to apply the amendments for contract modifications by Topic or services.Industry Subtopic as of any date from the beginning of an interim period that includes or is subsequent to March 12, 2020, or prospectively from a date within an interim period that includes or is subsequent to March 12, 2020, up to the date that the financial statements are available to be issued. Once elected for a Topic or an Industry Subtopic, the amendments in ASC 606 applies848 must be applied prospectively for all eligible contract modifications for that Topic or Industry Subtopic. Chart transitioned away from LIBOR rates on our debt facilities in early 2023 at which time we adopted this guidance. The adoption of this guidance did not have a material impact on our financial position, results of operations or disclosures.
NOTE 2 — Discontinued Operations
Cryobiological Products Divestiture
On October 1, 2020, we closed on the sale of our cryobiological products business, which was formerly within our D&S West segment prior to all contracts with customers except those that are within the scoperealignment of other topicsour segment reporting structuring in the FASB ASC. ASC 606 becomes effectivefourth quarter of 2020, to Cryoport, Inc. (NASDAQ: CYRX) for fiscal years beginning after December 15, 2017. The Company plans to adopt ASC 606 asnet cash proceeds of January 1, 2018 and has developed an implementation plan to adopt ASC 606 using the modified retrospective approach through a cumulative adjustment to retained earnings.
As part$317.5, inclusive of the implementation plan,base purchase price of $320.0 less estimated closing adjustments of $2.5 (the “Cryobiological Divestiture”). The strategic decision to divest of our cryobiological products business reflected our strategy and capital allocation approach to focus on our core capabilities and offerings.
Summarized Financial Information of Discontinued Operations
The following table represents income from discontinued operations, net of tax:
Three Months Ended March 31, 2023
Sales$— 
Selling, general and administrative expenses0.4 
Operating loss(0.4)
Other expense, net— 
Loss before income taxes(0.4)
Income tax benefit— 
Loss from discontinued operations, net of tax (1) (2)
$(0.4)
_______________
(1)There was no income or cash flows from discontinued operations for the Company has identified its revenue streamsthree months ended March 31, 2022.
(2)Includes legal fees related to our divested cryobiological products business. See Note 18 “Commitments and is inContingencies” for further information related to our discontinued operations for the process of performing contract reviews to assess the impact of ASC 606 on its results of operations. The Company expects to complete the contract reviews in the near future. While the Company continues to assess all impacts of the accounting change, the Company currently believes that the most significant impact will relate to the timing of revenue recognition. The Company expects the majority of

three months ended March 31, 2023.
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Notes to the Unaudited Condensed Consolidated Financial Statements – September 30, 2017March 31, 2023
(Dollars and shares in thousands,millions, except per share amounts) – Continued



revenue that has historically been recognized when products are shipped, title has transferred and collection

NOTE 3 — Reportable Segments
As reported in our Annual Report on Form 10-K for the year ended December 31, 2022, the structure of our internal organization is reasonably assured will meet the criteria for using point-in-time revenue recognition. The Company also expects that the majority of the revenue that has historically been recognized using the percentage of completion method of accounting will meet the criteria for over time revenue recognition. At this time, the Company has identifieddivided into the following impactsfour reportable segments, which are also our operating segments: Cryo Tank Solutions, Heat Transfer Systems, Specialty Products and Repair, Service & Leasing.
Our Cryo Tank Solutions segment supplies bulk, microbulk and mobile equipment used in the storage, distribution, vaporization, and application of industrial gases and certain hydrocarbons. Our Heat Transfer Systems segment supplies mission critical process technology, engineered equipment and systems used in the movement, separation, liquefaction, and purification of hydrocarbon and industrial gases that span gas-to-liquid applications. Our Specialty Products segment supplies products and solutions used in specialty end-market applications including hydrogen, biofuels, CO2 Capture, food and beverage, space exploration, gas by rail, lasers, cannabis and water treatment, among others. Our Heat Transfer Systems, Specialty Products and Cryo Tank segments also include products from the Howden Acquisition such as compressors, blowers and fans, rotary heaters and steam turbines. Our Repair, Service & Leasing segment provides installation, service, repair, maintenance, monitoring and refurbishment of cryogenic and compression products in addition to providing equipment leasing solutions as well as expanded aftermarket products and services related to timing of revenue recognition:the Howden acquisition.
Certain operations that have historically recognized revenue at a point-in-time will be required to changeCorporate includes operating expenses for executive management, accounting, tax, treasury, corporate development, human resources, information technology, investor relations, legal, internal audit and risk management. Corporate support functions are not currently allocated to the over time revenue recognition modelsegments.
We evaluate performance and allocate resources based on operating income as certain contracts contain language that meets the over time criteria establisheddetermined in ASC 606.
A portion of the revenue that has been deferred due to the current guidance for bill and hold revenues will be required to be recognized when the manufacturing process has been completed.
The Company is in the process of quantifying the above changes but does not expect them to be material to its consolidated financial statements. The Company expects adoption to increase the level of disclosures related to revenue recognition. In addition, the Company is in the process of identifying appropriate changes to its accounting policies, information technology systems, business processes, and internal control over financial reporting to support recognition under the new standard. The Company plans to complete the design of any necessary changes to its business processes, controls and systems and implement the changes over the remainder of 2017.
Recently Adopted Accounting Standards: In November 2016, the FASB issued ASU 2016-18, “Statement of Cash Flows (Topic 230): Restricted Cash.” The FASB issued the update to clarify how restricted cash or restricted cash equivalents should be presented in the statement of cash flows. The Company early adopted the amendments provided in ASU 2016-18 effective January 1, 2017 as reflected in theseour condensed consolidated financial statements to provide financial statement users with more transparent disclosure about restricted cash and restricted cash equivalents. The amendments were applied using a retrospective transition method to each period presented. Prior periods were not restated as the impact of adoption of ASU 2016-18 was not material to prior periods. The cash, cash equivalents, restricted cash, and restricted cash equivalents balance included $8,785 of restricted cash and restricted cash equivalents at September 30, 2017. Restricted cash and restricted cash equivalents are included in other current assets and other assets in the accompanying condensed consolidated balance sheet at September 30, 2017.
In March 2016, the FASB issued ASU 2016-09, “Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.” The FASB issued the update to change certain aspects of accounting for share-based payments to employees. The update eliminated additional paid-in-capital pools and requires all income tax effects of awards to be recognized in the statements of operations when the awards vest or settle. The Company prospectively recognized the excess income tax effects of awards as income tax expense or benefit in the condensed statements of operations and has electedcomprehensive (loss) income.
Segment Financial Information
 Three Months Ended March 31, 2023
 Cryo Tank SolutionsHeat Transfer SystemsSpecialty ProductsRepair, Service & LeasingIntersegment EliminationsCorporateConsolidated
Sales$127.2 $167.5 $127.3 $120.1 $(4.2)$— $537.9 
Depreciation and amortization expense5.6 8.4 8.6 9.9 — 0.8 33.3 
Operating income (loss) (1) (2)
4.9 27.3 22.1 33.8 — (51.9)36.2 

 Three Months Ended March 31, 2022
 Cryo Tank SolutionsHeat Transfer SystemsSpecialty ProductsRepair, Service & LeasingIntersegment EliminationsCorporateConsolidated
Sales$118.1 $79.3 $107.5 $49.3 $(0.1)$— $354.1 
Depreciation and amortization expense4.1 7.7 3.9 4.3 — 0.5 20.5 
Operating income (loss) (1) (2)
14.1 (0.2)16.2 8.3 — (18.3)20.1 
_______________
(1)Restructuring costs for the:
•three months ended March 31, 2023 were $1.6 ($0.8 - Cryo Tank Solutions, $0.8 - Repair, Service & Leasing).
•three months ended March 31, 2022 were $0.1 in our Heat Transfer Systems segment.
(2)Acquisition-related contingent consideration creditsin our Specialty Products Segment were related to continue to estimate the numberour 2020 acquisitions of share-based awards expected to vest rather than electing to accountSustainable Energy Solutions, Inc. (“SES”) and BlueInGreen, LLC (“BIG”) and for forfeitures as they occur. In addition, the Company prospectively recognized the excess tax benefits along with other income tax cash flows as an operating activity in the condensed consolidated statements of cash flows. The Company adopted this guidance effective January 1, 2017. The adoption of the guidance did not have a material impact on the Company’s condensed consolidated financial statements.the:
In July 2015, the FASB issued ASU 2015-11, “Simplifying the Measurement of Inventory.” The amendments require an entity to measure inventory at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The Company adopted this guidance prospectively for the fiscal year beginning January 1, 2017. The adoption of the guidance did not have a material impact on the Company’s condensed consolidated financial statements.•three months ended March 31, 2023 were $(7.4).

•three months ended March 31, 2022 were $(0.8).
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Notes to the Unaudited Condensed Consolidated Financial Statements – September 30, 2017March 31, 2023
(Dollars and shares in thousands,millions, except per share amounts) – Continued





Sales by Geography
Three Months Ended March 31, 2023
Cryo Tank SolutionsHeat Transfer SystemsSpecialty ProductsRepair, Service & LeasingIntersegment EliminationsConsolidated
North America$67.1 $134.6 $73.2 $57.3 $(2.3)$329.9 
Europe, Middle East, Africa and India42.0 15.5 33.0 36.1 (1.3)125.3 
Asia-Pacific17.3 14.3 20.1 23.0 (0.6)74.1 
Rest of the World0.8 3.1 1.0 3.7 — 8.6 
Total$127.2 $167.5 $127.3 $120.1 $(4.2)$537.9 
Three Months Ended March 31, 2022
Cryo Tank SolutionsHeat Transfer SystemsSpecialty ProductsRepair, Service & LeasingIntersegment EliminationsConsolidated
North America$37.9 $53.7 $60.0 $34.6 $(0.1)$186.1 
Europe, Middle East, Africa and India50.7 19.1 35.2 10.1 — 115.1 
Asia-Pacific28.2 6.1 12.2 4.0 — 50.5 
Rest of the World1.3 0.4 0.1 0.6 — 2.4 
Total$118.1 $79.3 $107.5 $49.3 $(0.1)$354.1 
Total Assets
Corporate assets mainly include cash and cash equivalents and long-term deferred income taxes as well as certain corporate-specific property, plant and equipment, net and certain investments. Our allocation methodology for property, plant and equipment, net of the reportable segments differs from our allocation method of depreciation expense of a reportable segment and therefore, depreciation expense does not entirely align with the related depreciable assets of the reportable segments. Furthermore, since finite-lived intangible assets are excluded from total assets of reportable segments while amortization expense is allocated to each of our reportable segments, amortization expense by segment inherently does not align with the related amortizable intangible assets of the reportable segments.
March 31,
2023		December 31,
2022
Cryo Tank Solutions$482.9 $382.0 
Heat Transfer Systems364.1 298.6 
Specialty Products371.6 429.8 
Repair, Service & Leasing169.3 182.1 
Total assets of reportable segments1,387.9 1,292.5 
Unallocated acquired assets (1)
1,290.6 — 
Goodwill (2)
2,933.2 992.0 
Identifiable intangible assets, net (2)
3,105.8 535.3 
Corporate531.3 2,830.7 
Insurance receivable, net of tax— 251.4 
Total$9,248.8 $5,901.9 
_______________
(1)As discussed in Note 13, “Business Combinations”, on March 17, 2023, we acquired Howden. Acquired assets resulting from this transaction have not yet been allocated at the reporting unit level, but will be allocated to the reporting units when the purchase price allocation is finalized during the measurement period and an analysis has been completed to determine an appropriate allocation.
(2)See Note 7, “Goodwill and Intangible Assets,” for further information related to goodwill and identifiable intangible assets, net.
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Notes to the Unaudited Condensed Consolidated Financial Statements – March 31, 2023
(Dollars and shares in millions, except per share amounts) – Continued




NOTE 24 — InventoriesRevenue
In January 2017,Disaggregation of Revenue
The following tables represent a disaggregation of revenue by timing of revenue along with the Company prospectively adoptedreportable segment for each category:
Three Months Ended March 31, 2023
Cryo Tank SolutionsHeat Transfer SystemsSpecialty ProductsRepair, Service & LeasingIntersegment EliminationsConsolidated
Point in time$93.0 $11.4 $4.3 $72.7 $(2.4)$179.0 
Over time34.2 156.1 123.0 47.4 (1.8)358.9 
Total$127.2 $167.5 $127.3 $120.1 $(4.2)$537.9 
Three Months Ended March 31, 2022
Cryo Tank SolutionsHeat Transfer SystemsSpecialty ProductsRepair, Service & LeasingIntersegment EliminationsConsolidated
Point in time$107.4 $5.9 $59.0 $25.9 $— $198.2 
Over time10.7 73.4 48.5 23.4 (0.1)155.9 
Total$118.1 $79.3 $107.5 $49.3 $(0.1)$354.1 
Refer to Note 3, “Reportable Segments,” for a table of revenue by reportable segment disaggregated by geography.
Contract Balances
The following table represents changes in our contract assets and contract liabilities balances:
March 31, 2023December 31, 2022Year-to-date Change ($)Year-to-date Change (%)
Contract assets
Accounts receivable, net of allowances$747.1 $278.4 $468.7 168.4 %
Unbilled contract revenue392.6 133.7 258.9 193.6 %
Contract liabilities
Customer advances and billings in excess of contract revenue$453.5 $170.6 $282.9 165.8 %
Long-term deferred revenue— 0.3 (0.3)(100.0)%
Revenue recognized for the guidance per ASU 2015-11, “Simplifyingthree months ended March 31, 2023 and 2022, that was included in the Measurement of Inventory.” The Company previously measured its inventorycontract liabilities balance at the lowerbeginning of costeach year was $68.0 and $63.7, respectively. The amount of revenue recognized during the three months ended March 31, 2023 from performance obligations satisfied or market with cost being determined bypartially satisfied in previous periods as a result of changes in the first-in, first-out (“FIFO”) method. Based onestimates of variable consideration related to long-term contracts, was not significant.
Remaining Performance Obligations
Remaining performance obligations represent the new guidance, the Company measures its inventory at the lowertransaction price of costfirm signed purchase orders or net realizable value with net realizable value beingother written contractual commitments from customers for which work has not been performed, or is partially completed, and excludes unexercised contract options and potential orders. As of March 31, 2023, the estimated selling pricesrevenue expected to be recognized in the ordinary coursefuture related to remaining performance obligations was $3,932.0. We expect to recognize revenue on approximately 65% to 70% of the remaining performance obligations over the next 12 months and the remaining over the next few years thereafter.
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CHART INDUSTRIES, INC. AND SUBSIDIARIES
Notes to the Unaudited Condensed Consolidated Financial Statements – March 31, 2023
(Dollars and transportation. The adoption of the guidance did not have a material impact on the Company’s condensed consolidated financial statements.shares in millions, except per share amounts) – Continued




NOTE 5 — Inventories
The following table summarizes the components of inventory:
September 30,
2017		 December 31,
2016		March 31,
2023		December 31,
2022
Raw materials and supplies$98,226
 $65,719
Raw materials and supplies$292.5 $218.9 
Work in process37,047
 31,576
Work in process162.5 57.8 
Finished goods78,317
 72,388
Finished goods146.8 81.2 
Total inventories, net$213,590
 $169,683
Total inventories, net$601.8 $357.9 
The allowancesallowance for excess and obsolete inventory was $8,525 and $10,069balance at September 30, 2017March 31, 2023 and December 31, 2016,2022 was $8.3 and $8.2, respectively.
NOTE6 — Leases
Lessee Accounting
The Company leases certain office spaces, warehouses, facilities, vehicles and equipment. Our leases have maturity dates ranging from May 2023 to November 2034. Leases with an initial term of twelve months or less are not recorded on the balance sheet. Operating lease ROU assets are classified as property, plant and equipment, net in the condensed consolidated balance sheets. Finance lease ROU assets are classified as other assets in the condensed consolidated balance sheets. Operating lease liabilities are classified as operating lease liabilities, current and operating lease liabilities, non-current. Finance lease liabilities are classified as other current liabilities and other long-term liabilities in the consolidated balances sheets.
We incurred $5.1 and $3.4 of rental expense under operating leases for the three months ended March 31, 2023 and 2022, respectively. Certain operating leases contain rent escalation clauses and lease concessions that require additional rental payments in the later years of the term. Rent expense for these types of leases is recognized on a straight-line basis over the minimum lease term. Adjustments for straight-line rental expense for the respective periods was not material and as such, the majority of expense recognized was reflected in cash provided by operating activities for the respective periods. This expense consisted primarily of payments for base rent on building and equipment leases. Payments related to short-term lease costs and taxes and variable service charges on leased properties were immaterial. In addition, we have the right, but no obligation, to renew certain leases for various renewal terms.
We incurred $0.1 and $0.1 of finance lease interest for the three months ended March 31, 2023 and 2022, respectively.
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Notes to the Unaudited Condensed Consolidated Financial Statements – March 31, 2023
(Dollars and shares in millions, except per share amounts) – Continued




The following table presents the lease balances within our condensed consolidated balance sheets, weighted average remaining lease term and weighted average discount rates related to our leases:
Lease Assets and LiabilitiesMarch 31, 2023December 31, 2022
Assets
Operating lease, net$65.9 $21.1 
Finance lease, net11.2 3.0 
Total lease assets$77.1 $24.1 
Liabilities
Current:
Operating lease liabilities$14.3 $5.4 
Finance lease liabilities2.5 1.7 
Non-current:
Operating lease liabilities52.0 15.6 
Finance lease liabilities$8.8 1.5 
Total lease liabilities$77.6 $24.2 
Weighted-average remaining lease terms
Operating leases5.1 years
Finance leases5.8 years
Weighted-average discount rate
Operating leases9.4%
Finance leases6.5%
The following table summarizes future minimum lease payments for non-cancelable operating leases and for finance leases as of March 31, 2023:
FinanceOperating
2023$2.4 $15.4 
20242.5 19.3 
20251.4 15.3 
20261.2 10.6 
20271.1 7.3 
Thereafter (1)
2.7 20.4 
Total future minimum lease payments$11.3 $88.3 
_______________
(1)     As of March 31, 2023, future minimum lease payments for non-cancelable operating leases for the period subsequent to 2027 relate to twenty leased facilities.
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Notes to the Unaudited Condensed Consolidated Financial Statements – March 31, 2023
(Dollars and shares in millions, except per share amounts) – Continued




Lessor Accounting
We lease equipment manufactured by Chart primarily through our Cryo-Lease program as sales-type and operating leases. As of March 31, 2023 and December 31, 2022, our short-term net investment in sales-type leases was $16.3 and $14.5, respectively, and is included in other current assets in our condensed consolidated balance sheets. Our long-term net investment in sales type leases was $50.6 and $44.3 as of March 31, 2023 and December 31, 2022, respectively, and is included in other assets in our condensed consolidated balance sheets. For sales type leases, interest income was $0.7 and $0.5 in the condensed consolidated statements of operations and comprehensive (loss) income for the three months ended March 31, 2023 and 2022, respectively.
Operating leases offered by Chart may include early termination options. At the end of a lease, a lessee generally has the option to either extend the lease, purchase the underlying equipment for a fixed price or return it to Chart. The lease agreements clearly define applicable return conditions and remedies for non-compliance to ensure that leased equipment will be in good operating condition upon return.
The following table represents sales from sales-type and operating leases:
Three Months Ended March 31,
20232022
Sales-type leases$12.7 $5.3 
Operating leases1.2 1.0 
Total sales from leases$13.9 $6.3 
The following table represents scheduled payments for sales-type leases:
March 31, 2023
2023$11.7 
202416.9 
202516.9 
202613.8 
20277.4 
Thereafter13.0 
Total79.7 
Less: unearned income12.8 
Total$66.9 
The following table represents the cost of equipment leased to others:
March 31, 2023December 31, 2022
Equipment leased to others, cost$19.0 $17.3 
Less: accumulated depreciation3.6 3.1 
Equipment leased to others, net$15.4 $14.2 
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The following table represents payments due for operating leases:
March 31, 2023
2023$0.6 
20240.1 
20250.1 
20260.1 
2027— 
Thereafter— 
Total$0.9 
NOTE 37 — Goodwill and Intangible Assets
Goodwill
The following table represents the changes in goodwill by segment:
Cryo Tank SolutionsHeat Transfer SystemsSpecialty ProductsRepair, Service & Leasing
Unallocated (3)
Consolidated
Balance at December 31, 2022$79.1 $430.5 $304.0 $178.4 $— $992.0 
Goodwill acquired during the period (1)
— — — — 1,938.3 1,938.3 
Foreign currency translation adjustments and other1.8 1.0 — — — 2.8 
Purchase price adjustments (2)
— — 0.1 — — 0.1 
Balance at March 31, 2023$80.9 $431.5 $304.1 $178.4 $1,938.3 $2,933.2 
Accumulated goodwill impairment loss at December 31, 2022$23.5 $49.3 $35.8 $20.4 $— $129.0 
Impairment loss— — — — — — 
Accumulated goodwill impairment loss at March 31, 2023$23.5 $49.3 $35.8 $20.4 $— $129.0 
 
Energy &
Chemicals
 Distribution & Storage BioMedical Total
Balance at December 31, 2016$27,873
 $165,520
 $24,577
 $217,970
Foreign currency translation adjustments and other—
 2,214
 (104) 2,110
Goodwill acquired during the year236,246
 1,155
 —
 237,401
Balance at September 30, 2017$264,119
 $168,889
 $24,473
 $457,481
        
Accumulated goodwill impairment loss at September 30, 2017 and December 31, 2016$64,603
 $—
 $131,243
 $195,846
_______________

(1)Goodwill acquired during the period was $1,938.3. All goodwill acquired during the period related to the Howden Acquisition.
(2)During the first three months of 2023, we recorded purchase price adjustments that increased goodwill by $0.1 in our Specialty Products segment related to the 2022 acquisition of Fronti Fabrications, Inc. (“Fronti”). For further information regarding goodwill acquired and the purchase price adjustments during the period refer to Note 13, “Business Combinations.”
(3)As discussed in Note 13, “Business Combinations”, on March 17, 2023, we acquired Howden. A preliminary goodwill balance of $1,938.3 was recognized for the excess of the consideration transferred over the net assets acquired. Goodwill resulting from this transaction has not yet been allocated at the reporting unit level, but will be allocated to the reporting units when the purchase price allocation is finalized during the measurement period and an analysis has been completed to determine an appropriate allocation based on the relative fair value of each of these reporting units.
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Intangible Assets
The following table displays the gross carrying amount and accumulated amortization for finite-lived intangible assets and indefinite-lived intangible assets (exclusive of goodwill)(1) (2):
 September 30, 2017 December 31, 2016 March 31, 2023December 31, 2022
Weighted-average Estimated Useful Life 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Gross
Carrying
Amount
 
Accumulated
Amortization
 Weighted-average Estimated Useful LifeGross
Carrying
Amount		Accumulated
Amortization		Gross
Carrying
Amount		Accumulated
Amortization
Finite-lived intangible assets:        Finite-lived intangible assets:
Customer relationships12 years $233,208
 $(83,596) $119,320
 $(81,614)Customer relationships11 years$1,626.0 $(115.2)$311.5 $(104.6)
Unpatented technology12 years 27,686
 (3,836) 8,186
 (3,132)Unpatented technology13 years522.1 (50.3)202.5 (44.8)
Patents and otherPatents and other3 years366.4 (7.7)6.8 (2.0)
Trademarks and trade namesTrademarks and trade names16 years2.9 (1.8)2.5 (1.7)
Land use rights50 years 13,222
 (1,097) 12,650
 (860)Land use rights50 years10.5 (1.8)10.4 (1.7)
Trademarks and trade names14 years 5,517
 (2,767) 4,918
 (2,198)
Patents and other6 years 2,878
 (502) 1,235
 (695)
Total finite-lived intangible assets14 years $282,511
 $(91,798) $146,309
 $(88,499)Total finite-lived intangible assets10 years2,527.9 (176.8)533.7 (154.8)
Indefinite-lived intangible assets:        Indefinite-lived intangible assets:
Trademarks and trade names $108,165
 —
 $35,633
 —
Trademarks and trade names (2)
Trademarks and trade names (2)
754.7 — 156.4 — 
Total intangible assets $390,676
 $(91,798) $181,942
 $(88,499)Total intangible assets$3,282.6 $(176.8)$690.1 $(154.8)
_______________
(1)
Amounts include the impact of foreign currency translation. Fully amortized amounts are written off.
(2)
The Company amortizes certain identifiable intangible assets primarily on a straight-line basis over their estimated useful lives, which range from one to 50 years.
Expense(1)Amounts include the impact of foreign currency translation. Fully amortized or impaired amounts are written off.
(2)Accumulated indefinite-lived intangible assets impairment loss was $16.0 at both March 31, 2023 and December 31, 2022.
Amortization expense for intangible assets subject to amortization was $3,240$21.8 and $2,912$10.1 for the three months ended September 30, 2017March 31, 2023 and 2016, respectively, and $9,301 and $9,156 for the nine months ended September 30, 2017 and 2016,2022, respectively. The Company estimates futureWe estimate amortization expense for its current finite-lived intangible assetsto be recognized during the next five years as follows:
For the Year Ending December 31, 
2017$15,700
201824,400
201924,100
202022,200
202116,100
For the Year Ending December 31,
2023$241.7 
2024321.2 
2025320.2 
2026218.5 
2027194.8 
Government Grants
During the fourth quarter of 2021, we were selected by the U.S. Department of Energy (“DOE”) for funding of up to $5.0 to engineer and build our Cryogenic Carbon CaptureTM system for a cement plant. During the project’s duration, the DOE shall reimburse us in cash for approved expenses we incur. This project began on February 1, 2022, at which point expenses incurred may be submitted for reimbursement. The Companyagreement will be effective until April 30, 2025. We have not yet received $407 inany funding for this grant.
We received certain government grants during the first nine months of 2017. The government grants are related to property, plant, and equipment and land use rights related tofor capacity expansion in China. The grantsChina (“China Government Grants”). China Government Grants are generally recorded in other current liabilities and other long-term liabilities in the unaudited condensed consolidated balance sheets and generally recognized into income over the useful life of the associated assets (10 to 50 years).
China Government grants at September 30, 2017 and December 31, 2016Grants are presented in our unaudited condensed consolidated balance sheets as follows:
September 30,
2017		 December 31,
2016		March 31,
2023		December 31,
2022
Current$481
 $446
Current$0.5 $0.5 
Long-term8,378
 8,153
Long-term6.1 6.1 
Total government grants$8,859
 $8,599
Total China Government GrantsTotal China Government Grants$6.6 $6.6 
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(Dollars and shares in thousands,millions, except per share amounts) – Continued





We also received government grants from certain local jurisdictions within the United States, which are recorded in other assets in the condensed consolidated balance sheets and were not significant for the periods presented.
NOTE 48 — Investments
Equity Method Investments
The following table represents the activity in equity method investments:
Equity Method Investments(1) (2) (3)
Balance at December 31, 2022$93.0 
New investments (4)
12.4 
Equity in loss of unconsolidated affiliates(0.5)
Foreign currency translation adjustments and other(0.2)
Balance at March 31, 2023$104.7 
_______________
(1)Cryomotive: Our equity method investment in Cryomotive GmbH (“Cryomotive”) was $5.1 and $4.9 at March 31, 2023 and December 31, 2022, respectively. Equity in earnings (loss) of unconsolidated affiliates, net of this investment was $0.1 and $(0.5) for the three months ended March 31, 2023 and 2022, respectively, and is classified in equity in loss of unconsolidated affiliates, net in the condensed consolidated statements of operations and comprehensive (loss) income. The remaining change in fair value during the current period was attributable to an immaterial gain on foreign currency translation.
(2)HTEC: Our equity method investment in HTEC Hydrogen Technology & Energy Corporation (“HTEC”) was $79.7 and $80.8 at March 31, 2023 and December 31, 2022, respectively. Equity in loss of unconsolidated affiliates, net of this investment was $(1.0) and $(0.3) for the three months ended March 31, 2023 and 2022, respectively. The remaining change in fair value during the current period was attributable to an immaterial loss on foreign currency translation.
(3)Hudson Products: Also included in our equity method investments is a 50% ownership interest in a joint venture with Hudson Products de Mexico S.A. de CV which totaled $4.3 and $4.0 at March 31, 2023 and December 31, 2022, respectively. This investment is operated and managed by our joint venture partner and as such, we do not have control over the joint venture and therefore it is not consolidated. We recognized equity in earnings of unconsolidated affiliates, net of this investment of $0.3 and $0.3 for the three months ended March 31, 2023 and 2022, respectively.
Liberty LNG: Additionally, we have a 25% ownership interest in Liberty LNG, which totaled $3.0 and $2.9 at March 31, 2023 and December 31, 2022, respectively. We recognized equity in earnings of unconsolidated affiliates, net of this investment of $0.1 and $0.1 for the three months ended March 31, 2023 and 2022, respectively.
We have another immaterial investment in an unconsolidated affiliate of $0.4 for all periods presented.
(4)Hylium Industries: During the first quarter of 2023, we completed an investment for a 50% ownership interest in Hylium Industries, Inc. (“Hylium”) for $2.3. Our equity method investment in Hylium was $2.2 at March 31, 2023. The change in fair value during the current period was attributable to an immaterial loss on foreign currency translation.
L&T Howden Private Ltd ("LTH"): In connection with the Howden Acquisition, we recorded a 49.9% ownership interest in a joint venture in L&T Howden Private Ltd at a fair value of $10.1. Our equity method investment in LTH was $10.0 at March 31, 2023. Equity in earnings, net of this investment was $0.0 in the period ended March 31, 2023, and is classified in equity in loss of unconsolidated affiliates, net in the condensed consolidated statement of operations for the three months ended March 31, 2023. The change in fair value during the current period was attributable to an immaterial loss on foreign currency translation.
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(Dollars and shares in millions, except per share amounts) – Continued




Investments in Equity Securities
The following table summarizes the components of our investments in equity securities:
Investment in Equity Securities,
Level 1 (1)
Investment in Equity Securities,
Level 2 (1)
Investments in Equity Securities, All Others (2)
Investments Total
Balance at December 31, 2022$17.2 $7.8 $71.5 $96.5 
Decrease in fair value of investments in equity securities0.5 (2.5)— (2.0)
Foreign currency translation adjustments and other0.2 — (0.1)0.1 
Balance at March 31, 2023$17.9 $5.3 $71.4 $94.6 
_______________
(1)McPhy: Investment in equity securities Level 1 includes our investment in McPhy (Euronext Paris: MCPHY - ISIN; FR001742329). McPhy’s common stock trades on the Euronext Paris stock exchange and therefore we measure our investment in McPhy using Level 1 fair value inputs. The fair value of our investment in McPhy was $17.9 and $17.2 at March 31, 2023 and December 31, 2022, respectively. We recognized an unrealized gain of $0.5 and an unrealized loss of $3.7 in our investment in McPhy for the three months ended March 31, 2023 and 2022, respectively.
Stabilis: Investment in equity securities Level 2 includes our investment in Stabilis Energy, Inc. (NasdaqCM: SLNG) (“Stabilis”). Stabilis represents an instrument with quoted prices that trades less frequently than certain of our other exchange-traded instruments and therefore we measure our investment in Stabilis using Level 2 fair value inputs. The fair value of our investment in Stabilis was $5.3 and $7.8 at March 31, 2023 and December 31, 2022, respectively. We recognized an unrealized loss of $2.5 and an unrealized gain of $1.1 for the three months ended March 31, 2023 and 2022, respectively, in our investment in Stabilis.
(2)Transform: The fair value of our investment in Transform Materials LLC (“Transform Materials”) was $25.1 at both March 31, 2023 and December 31, 2022.
Svante: The fair value of our investment in Svante Inc. (“Svante”) was $38.5 at both March 31, 2023 and December 31, 2022.
Hy24: Our investment in Hy24 is measured at fair value using the net asset value (“NAV”) per share practical expedient and is not classified in the fair value hierarchy. The fair value of our investment in the Hy24 was $0.8 and $0.9 at March 31, 2023 and December 31, 2022, respectively. See “Hy24 (f/k/a FiveT Hydrogen Fund)” below for further information.
Gold Hydrogen LLC: The fair value of our investment in Gold Hydrogen was $2.0 at both March 31, 2023 and December 31, 2022, respectively.
Avina: During the fourth quarter of 2022, we completed an investment in Avina Clean Hydrogen Inc. (“Avina”) in the amount of $5.0. The fair value of our investment in Avina was $5.0 at both March 31, 2023 and December 31, 2022, respectively.
Our investments in Transform Materials, Svante, Hy24, Gold Hydrogen and Avina represent equity instruments without a readily determinable fair value. These investments are measured at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for an identical or a similar investment of the same issuer.
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(Dollars and shares in millions, except per share amounts) – Continued




Co-Investment Agreement
On September 7, 2021, we entered into a Co-Investment Agreement with I Squared Capital (“ISQ”), an infrastructure-focused private equity firm (the “Co-Investment Agreement”), pursuant to which Chart and ISQ have agreed to the following:
•In the following circumstances, ISQ shall have the right but not the obligation to require Chart to purchase all (and not less than all) of the shares of HTEC common stock acquired as part of ISQ’s investment described above (the “Put Option”):
i.the third anniversary of the Closing Date,
ii.the date Chart undergoes a change of control (subject to certain exceptions),
iii.the date upon which Chart, during the period from the Closing Date through the third anniversary of the Closing Date, has made certain distributions to its shareholders (including cash or other dividends, or via a spin-off transaction), in excess of $900.0,
iv.the date, if any, upon which our leverage ratio exceeds certain thresholds and
v.the date, if any, of a bankruptcy event (including certain insolvency-related actions) involving Chart.
•In the event that ISQ exercises its Put Option, we shall pay to ISQ an amount in cash in exchange for the HTEC common stock then held by ISQ such that ISQ shall realize the greater of (i) an internal rate of return of 10% and (ii) a multiple on ISQ’s invested capital of 1.65x.
•Conversely, at any time after the third anniversary of the Closing Date, we shall have the right to purchase from ISQ up to 20% of the shares of HTEC common stock acquired as part of the ISQ Investment. In exchange for the common stock, we shall pay ISQ the greater of (i) an internal rate of return of 12.5% and (ii) a multiple on ISQ’s invested capital of 1.65x.
•In addition, we shall have (i) a right of first offer: if ISQ desires to transfer any of its HTEC common stock to any third party, we shall have the right to first offer provided that upon notice, we shall have the option to make a first offer to purchase the offered interest in cash exclusively and (ii) a right of first refusal: if ISQ desires to sell its HTEC common stock to any third party pursuant to a definitive agreement therewith, we shall have the right of first refusal provided that the purchase consideration paid by Chart to ISQ upon our exercise of such right of first refusal must be equal to 102% of the purchase consideration agreed to be paid by such third party.
•The Co-Investment Agreement shall terminate automatically upon the consummation of an initial public offering by HTEC of its common stock.
Accounting Treatment of Put and Call Options
We record the Put and Call Options (together “the Options”) at fair value and record any change in fair value through earnings at each reporting period. The fair value of the Options was not material on March 31, 2023.
Hy24 (f/k/a FiveT Hydrogen Fund)
As previously announced on April 5, 2021, we were admitted as an anchor investor in Hy24 (the “Hydrogen Fund”). Hy24 is a joint venture between Ardian, Europe’s largest private investment house with managed assets of approximately $150 billion, and FiveT Hydrogen, a new investment manager specialized purely on clean hydrogen investments. As discussed in the “Investments in Equity Securities” section above, our investment to date is euro 0.7 million, making our unfunded commitment euro 49.3 million. During the three months ended March 31, 2023 there was a return of capital of $0.2 from Hy24.
The fund manager of the Hydrogen Fund (the “Management Company”) established a Limited Partners Advisory Committee (the “LPAC”) which consults with and helps advise the Management Company with respect to certain key decisions governing the fund that the Management Company shall make. The LPAC is comprised of up to fifteen (15) members, the majority of whom are chosen by certain industrial investors and who are (i) representatives of the anchor investors and (ii) subject to any remaining available seats, representatives of the non-anchor investors selected by the Management Company.
Class A1 Shares, which we hold, are entitled to the return of any associated paid-up capital contributions (excluding any subscription premium or default interest, if any), the Preferred Return calculated thereon as described below, and their share of the Hydrogen Fund’s capital gain beyond the Preferred Return in accordance with the order of distributions in the by-laws of the Hydrogen Fund (in each case to the extent of available funds). The “Preferred Return” equals an annual interest rate of seven percent (7%) if fifteen percent (15%) of the Hydrogen Fund’s aggregate capital commitments from all investors is invested in strategic investments; provided, however, that such seven percent (7%) interest rate shall be reduced in a linear
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fashion to six and one-half percent (6.5%) if twenty percent (20%) of the Hydrogen Fund’s aggregate capital commitments from all investors is invested in strategic investments. The Management Company currently expects that the Hydrogen Fund will attract aggregate capital commitments equal to its hard cap of euro 1.8 billion.
The Hydrogen Fund shall determine the net asset value of each class of its shares at the end of each quarter (Including the Class A1 Shares that we hold), which will be used to record the fair value of our investment.
The Hydrogen Fund will have a term of twelve (12) years, commencing from December 16th, 2021, subject to certain potential extensions. Investors cannot request the redemption of their shares by the Hydrogen Fund at any time prior to the final liquidation of the fund. Capital calls will be made by the Management Company in accordance with investment opportunities and the financing needs of the Hydrogen Fund’s activities.
The Management Company is required to send capital call requests to investors at least ten (10) business days prior to their deadline for payment. In the event that, following any capital call made by the Management Company, an investor of the Hydrogen Fund does not timely fund all or any portion of its capital commitment required thereby, such investor will be charged interest thereon equal to the Preferred Return plus one-half percent (0.5%), and shall not be entitled to receive distributions from the Hydrogen Fund until it is no longer delinquent.
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(Dollars and shares in millions, except per share amounts) – Continued




NOTE 9 — Debt and Credit Arrangements
Summary of Outstanding Borrowings
The following table represents the components of the Company’sour borrowings:
 September 30,
2017		 December 31,
2016
Convertible notes, due August 2018, effective interest rate of 7.9%$238,142
 $228,115
Senior secured revolving credit facility, due October 2019, effective interest rate of 4.0%300,000
 —
Foreign facilities10,792
 13,208
Total debt548,934
 241,323
Unamortized debt issuance costs(592) (1,125)
Total debt, net of unamortized debt issuance costs548,342
 240,198
Less: current maturities (1)
(244,330) (6,487)
Long-term debt$304,012
 $233,711
 March 31,
2023		December 31,
2022
Senior secured and senior unsecured notes:
Principal amount, senior secured notes due 2030 (1)
$1,460.0 $1,460.0 
Principal amount, senior unsecured notes due 2031 (1)
510.0 510.0 
Unamortized discount(29.2)(29.9)
Unamortized debt issuance costs(35.8)(4.8)
Senior secured and senior unsecured notes, net of unamortized discount and debt issuance costs1,905.0 1,935.3 
Senior secured revolving credit facilities and term loan:
Term loan due March 2030 (2)
1,534.8 — 
Senior secured revolving credit facility due October 2026 (3) (4)
697.2 104.5 
Unamortized discount(37.5)— 
Unamortized debt issuance costs(33.3)— 
Senior secured revolving credit facility and term loan, net of unamortized discount and debt issuance costs2,161.2 104.5 
Convertible notes due November 2024:
Principal amount258.8 258.8 
Unamortized debt issuance costs(1.6)(1.9)
Convertible notes due November 2024, net of unamortized debt issuance costs257.2 256.9 
Other debt facilities (6)
1.6 — 
Total debt, net of unamortized debt issuance costs4,325.0 2,296.7 
Less: current maturities (5)
273.4 256.9 
Long-term debt$4,051.6 $2,039.8 
_______________
(1)Current maturities includes $238,142 current convertibleThe senior secured notes at September 30, 2017.
Convertible Notes
The outstanding aggregate principal amount of the Company’s 2.0% Convertible Senior Subordinated Notes due August 1, 20182030 (the “Convertible“Secured Notes”) is $250,000. The Convertible Notesand senior unsecured notes due 2031 (the “Unsecured Notes”) bear interest at a fixed raterates of 2.0%7.500% and 9.500% per year, respectively. Interest is payable semiannually in arrearssemi-annually on FebruaryJanuary 1 and AugustJuly 1 of each year, and willcommencing July 1, 2023. The Secured Notes mature on AugustJanuary 1, 2018. 2030, and the Unsecured Notes mature on January 1, 2031.
(2)The effectiveterm loan due March 2030 was drawn prior to March 31, 2023 in conjunction with the Howden Acquisition. As of March 31, 2023, there were $1,534.8 in borrowings outstanding under the term loan due March 2030 bearing an interest rate at issuance was 7.9%of 8.6%. See below for more information.
The Convertible Notes are senior subordinated unsecured obligations(3)As of the Company and are not guaranteed by any of the Company’s subsidiaries. The Convertible Notes are seniorMarch 31, 2023, there were $697.2 in right of payment to the Company’s future subordinated debt, equal in right of payment with the Company’s future senior subordinated debt, and are subordinated in right of payment to the Company’s existing and future senior indebtedness, including indebtednessborrowings outstanding under the Company’s existingsenior secured revolving credit agreement.
In connection with the issuancefacility due October 2026 bearing an interest rate of the Convertible Notes, the Company entered into privately-negotiated convertible note hedge and capped call transactions with affiliates of certain of the underwriters (the “Option Counterparties”). The convertible note hedge and capped call transactions relate to, collectively, 3,622 shares, which represents the number of shares of the Company’s common stock underlying the Convertible Notes, subject to anti-dilution adjustments substantially similar to those applicable to the Convertible Notes. These convertible note hedge and capped call transactions are expected to reduce the potential dilution with respect to the Company’s common stock upon conversion of the Convertible Notes and/or reduce the Company’s exposure to potential cash or stock payments that may be required upon conversion of the Convertible Notes, except, in the case of the capped call transactions, to the extent that the market price per share of the Company’s common stock exceeds the cap price of the capped call transactions. The Company also entered into separate warrant transactions with the Option Counterparties initially relating to the number of shares of the Company’s common stock underlying the convertible note hedge transactions, subject to customary anti-dilution adjustments. The warrant transactions will have a dilutive effect with respect to the Company’s common stock to the extent that the price per share of the Company’s common stock exceeds the strike price of the warrants unless the Company elects, subject to certain conditions, to settle the warrants in cash. These warrants were exercisable5.0% (3.4% as of December 31, 2022) and $265.8 in letters of credit and bank guarantees outstanding supported by the issuance datesenior secured revolving credit facility due 2026. As of March 31, 2023, the Convertible Notes. The cap pricesenior secured revolving credit facility due 2026 had availability of the capped call transactions and the strike price of the warrant transactions was initially $84.96 per share. Proceeds received from the issuance of the warrants totaled approximately $48,848 and were recorded as an addition to additional paid-in-capital. The net cost of the convertible note hedge and capped call transactions, taking into account the proceeds from the issuance of the warrants, was approximately $17,638.
In accordance with ASC 815, contracts are initially classified as equity if (1) the contract requires physical settlement or net-share settlement, or (2) the contract gives the entity a choice of net-cash settlement in its own shares (physical settlement or net-share settlement). The Company concluded that the settlement terms of the convertible note hedge, capped call, and warrant transactions permit net-share settlement. As such, the convertible note hedge, capped call, and warrant transactions were recorded in equity.

$37.0.
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Upon issuance

(4)A portion of the Convertible Notes, the Company bifurcated the $250,000 principal balance of the Convertible Notes into a liability component of $170,885, which was recorded as long-term debt,borrowings outstanding under our senior secured revolving credit facility due 2026 are denominated in euros (“EUR Revolver Borrowings”). EUR Revolver Borrowings outstanding were euro 94.0 million (equivalent to $102.2) at March 31, 2023 and an equity component of $79,115, which was initially recorded as additional paid-in-capital. The liability component was recognizedeuro 98.0 million (equivalent to $104.5) at the present value of its associated cash flows using a 7.9% straight-debt rate which represented the Company’s interest rate for similar debt instruments at that time without a conversion feature and is being accreted to interest expense over the term of the Convertible Notes. At September 30, 2017 and December 31, 2016, the carrying amount of the liability component was $238,142 (less debt issuance costs of $592) and $228,115 (less debt issuance costs of $1,125), respectively, and the unamortized debt discount of the Convertible Notes was $11,858 and $21,885, respectively.
For2022. During the three months ended September 30, 2017March 31, 2023 and 2016, interest expense2022, we recognized an unrealized foreign currency loss of $1.7 and an unrealized foreign currency gain of $0.9, respectively, relative to the translation of the EUR Revolver Borrowings outstanding. This unrealized foreign currency loss (gain) is classified within foreign currency (gain) loss in the condensed consolidated statements of operations and comprehensive (loss) income for all periods presented.
(5)Our convertible notes due November 2024, net of unamortized debt issuance costs, are included in current maturities for both periods presented. Also included in current maturities for the Convertible Notes was $4,658 and $4,400, respectively, which included $3,408 and $3,150 of non-cash interest accretion expensecurrent period is $14.6 related to the carrying amountshort-term portion of the Convertibleterm loan due March 2030 and $1.6 of other current maturities.
(6)Other debt facilities relate to a small number of local debt facilities that we assumed through the Howden Acquisition.
Senior Secured and Unsecured Notes respectively,
On December 22, 2022, we completed the issuance and $1,250sale of cash interest for both periods. For the nine months ended September 30, 2017 and 2016, interest expense for the Convertible Notes was $13,777 and $13,018, respectively, which included $10,027 and $9,268 of non-cash interest accretion expense related to the carrying amount of the Convertible Notes, respectively, and $3,750 of 2.0% cash interest for both periods. In accordance with ASC 470-20, which requires issuers to separately account for the liability and equity components of convertible debt instruments that may be settled in cash upon conversion, the Company allocated debt issuance costs to the liability and equity components in proportion to their allocated value. Debt issuance costs were $7,277, with $2,303 recorded as a reduction in additional paid-in-capital. The remaining balance of $4,974 is being amortized over the term of the Convertible Notes. For the three months ended September 30, 2017 and 2016, total expense associated with the amortization of these debt issuance costs was $178 for both periods. For the nine months ended September 30, 2017 and 2016, total expense associated with the amortization of these debt issuance costs was $533 for both periods.
Prior to May 1, 2018, the Convertible Notes will be convertible at the option of the holders thereof only under the following circumstances: (1) during any fiscal quarter commencing after September 30, 2011 (and only during such fiscal quarter), if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on the last trading day of the immediately preceding fiscal quarter is greater than or equal to 130% of the applicable conversion price (currently $69.03) for the Convertible Notes on each applicable trading day; (2) during the five business day period after any five consecutive trading day period (the “Measurement Period”) in which, as determined following a request by a holder of Convertible Notes as provided in the bond indenture (the “Indenture”), the trading price per $1,000 principal amount of Convertible Notes for each trading day of such Measurement Period was less than 97% of the product of the last reported sale price of the Company’s common stock and the applicable conversion rate for the Convertible Notes on each such trading day; or (3) upon the occurrence of specified corporate events pursuant to the terms of the Indenture. On or after May 1, 2018, until the close of business on the second scheduled trading day immediately preceding the maturity date of the Convertible Notes, holders of the Convertible Notes may convert their Convertible Notes at any time, regardless of the foregoing circumstances. Upon conversion, the Company will pay cash up to the(i) $1,460.0 aggregate principal amount of 7.500% Secured Notes at an issue price of 98.661% and (ii) $510.0 aggregate principal amount of 9.500% Unsecured Notes (together with the ConvertibleSecured Notes, the “Notes”), at an issue price of 97.949%. The Notes were issued to be converted and pay or deliver, asfinance the case may be, cash, sharesHowden Acquisition. Chart deposited the gross proceeds from the offering of each series of Notes into an escrow account (each, an “Escrow Account”). The funds were held in the respective Escrow Account until certain release conditions were met including the consummation of the Company’s common stock,Howden Acquisition (the “Escrow Release Conditions”). As such, the proceeds were presented separately from cash and cash equivalents as restricted cash in the December 31, 2022 condensed consolidated balance sheet.
The Notes are fully and unconditionally guaranteed by each of Chart’s wholly owned domestic restricted subsidiaries that is a borrower or a combinationguarantor under Chart’s Fifth Amended and Restated Credit Agreement, dated as of cashOctober 18, 2021 (as amended, restated, supplemented, or otherwise modified from time to time). The Secured Notes and sharesthe related guarantees are secured by first-priority liens on substantially all of the Company’s common stock,assets of the Company and the Guarantors, subject to certain exceptions.
We may redeem either series of the Notes, in whole or in part, at any time on or after January 1, 2026, at the Company’s election,redemption prices set forth in respect of the remainder, if any, of the Company’s conversion obligation in excessrespective Indentures. We may also redeem up to 40% of the aggregate principal amount of the Convertible Notes being converted. It is the Company’s intention to settle any excess conversion value in shareseach series of the Company’s common stock.
The conversion rateNotes on the Convertible Notes will be subject to adjustment upon the occurrence of certain events, but will not be adjusted for any accrued and unpaid interest. In addition, following the occurrence of a make-whole fundamental change, the Company will, in certain circumstances, increase the conversion rate for a holder that converts its Convertible Notes in connection with such make-whole fundamental change. The Company may not redeem the Convertible Notesor prior to maturity. IfJanuary 1, 2026, in an amount not to exceed the Company undergoes a fundamental change, subjectnet cash proceeds from certain equity offerings at the redemption prices set forth in the respective Indentures. Prior to certain conditions, holdersJanuary 1, 2026, we may requireredeem some or all of either series of the Company to purchase the Convertible Notes in whole or in part for cash at a fundamentalprice which includes the applicable “make-whole” premium set forth in the respective Indentures.
If Chart experiences a change purchase price equal to 100% of control (as defined in the principal amount ofrespective Indentures), the Convertible Notes are able to be purchased,redeemed by the holders at 101%, plus accrued and unpaid interest, if any, to but excluding,(but not including) the fundamental change purchase date. For purposes of calculating earnings per share, ifdate the average market priceNotes are purchased.
We recorded a $30.0 debt discount and $36.8 in deferred debt issuance costs associated with the Notes, which are being amortized over the term of the Company’s common stock exceedsNotes using the applicable conversion priceeffective interest method. We incurred and paid $32.0 of deferred debt issuance costs during the periods reported, shares contingently issuable underthree months ended March 31, 2023. We recorded $1.0 in financing costs amortization associated with the Convertible Notes will have a dilutive effect with respect tofor the Company’s common stock.three months ended March 31, 2023.
The Company reassessesfollowing table summarizes the convertibilityinterest accretion of the Convertible Notes discount and contractual interest coupon associated with the related balance sheet classification on a quarterly basis. The Convertible Notes are classified as current liabilities at September 30, 2017 as their maturity is within 12 months of the balance sheet date. At the end of the third quarter of 2017, events for early conversion were not met, and thus the Convertible Notes were not convertible as of and for the fiscal quarter beginning October 1, 2017. There have been no conversions as of the date of this filing.Notes:

Three Months Ended March 31, 2023
Notes, interest accretion of senior notes discount$0.7 
Secured Notes, 7.5% contractual interest coupon27.4 
Unsecured Notes, 9.5% contractual interest coupon12.1 
Notes, total interest expense$40.2 
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Notes to the Unaudited Condensed Consolidated Financial Statements – September 30, 2017March 31, 2023
(Dollars and shares in thousands,millions, except per share amounts) – Continued





Senior Secured Revolving Credit Facility and Term Loan
Senior Secured Revolving Credit Facility
The Company has a five-year $450,000On November 21, 2022, we entered into an amendment (“Amendment No. 1”) to our fifth amended and restated revolving credit agreement dated as of October 18, 2021 (as amended by Amendment No. 1, the “Credit Agreement”), which amended our senior secured revolving credit facility (“SSRCF”). The Credit Agreement provides for a Senior Secured Revolving Credit Facility (the “SSRCF”“Amended SSRCF”), which matures on October 29, 2019. 19, 2026.
•The Amended SSRCF has a borrowing capacity of $1,000.0 and includes a $25,000 sub-limit for the issuance of swingline loans and a $100,000 sub-limit to be usedsub limit for letters of credit. Therecredit that is the greater of (x) $350.00 and (y) $150.00 plus (1) the Dollar Amount (as of the Amended Closing Date) of the Assumed Letters of Credit plus (2) the Dollar Amount of any Letters of Credit issued on the Amendment Closing Date, a foreign currency$200.0 sub limit for discretionary letters of $100,000credit and a $100.0 sub-limit for swingline loans.
•We may, subject to the satisfaction of certain conditions, request one or more new commitments and/or increase in the amount of the Amended SSRCF. Each incremental term commitment and incremental revolving commitment shall be in an aggregate principal amount that is not less than $10.0 and shall be in an increment of $1.0 to the extent existing or new lenders agree to provide such increased or additional commitments, as applicable.
•The Amended SSRCF bears interest at a base rate plus an applicable margin determined on a leveraged-based scale which (before giving effect to the sustainability pricing adjustments described below) ranges from 25 to 125 basis points for base rate loans and 125 to 225 basis points for SOFR loans.
•The applicable margin described above is subject to further adjustments based on the reductions in the ratio between (i) the total greenhouse gas emissions, measured in metric tons CO2e, of Chart and its subsidiaries during such calendar year and (ii) the aggregate revenue, measured in U.S. Dollars, of Chart and its subsidiaries during such calendar year. These additional pricing adjustments range from an addition of 0.05% to a reduction of 0.025% in the applicable margin described above.
•We are required to pay commitment fees on any unused commitments under the SSRCF which, can be used for foreign currency denominated lettersbefore giving effect to the sustainability fee adjustments (as described below), is determined on a leverage-based sliding scale ranging from 20 to 35 basis points.
•The commitment fees described above are also subject to sustainability fee adjustments based on the aforementioned ratio. The sustainability fee adjustments range from an addition of credit0.01% to a reduction of 0.01%.
•Interest and borrowings infees are payable on a foreign currency, in each case in currencies agreed upon with the lenders. In addition, the facility permits borrowings up to $100,000 made by the Company’s wholly-owned subsidiaries, Chart Industries Luxembourg S.à. r.l. (“Chart Luxembourg”) and Chart Asia Investment Company Limited (“Chart Asia”). The SSRCF also includes an expansion option permitting the Company to add up to an aggregate $200,000 in term loans or revolving credit commitments from its lenders.
The Company recorded $2,869 in deferred debt issuance costs associated with the SSRCF which are being amortized over the five-year term of the SSRCF. This balance is recorded in other assets in the condensed consolidated balance sheets. For the three months ended September 30, 2017 and 2016, total expense associated with the amortization of these debt issuance costs was $143 for both periods. For the nine months ended September 30, 2017 and 2016, the related financing costs amortization was $430 for both periods.
Revolving loans under the SSRCF bear interest,quarterly basis (or if earlier, at the applicable Borrower’s election, at either LIBOR or the greatestend of (a) the JPMorgan prime rate in effect on such day, (b) the Federal Funds Effective Rate in effect on such day plus 1/2 of 1%, or (c) the Adjusted LIBOR Rate (as defined in the SSRCF) for the relativeeach interest period on such day (or if such day is not a business day, the immediately preceding business day) plus 1% (the “Adjusted Base Rate”), plus a margin that varies with the Company’s leverage ratio. In addition, the Company is required to pay a commitment fee of between 0.25% and 0.40% of the unused revolver balance and a letter of credit participation fee equal to the daily aggregate letter of credit exposure at the rate per annum equal to the Applicable Margin for Eurocurrency Revolving Facility Borrowings (ranging from 1.5% to 2.75%, depending on the leverage ratio calculated at each fiscal quarter end)SOFR loans). A fronting fee must be paid on each letter of credit that is issued equal to 0.125% per annum of the stated dollar amount of the letter of credit.
Significant financial covenants for the Amended SSRCF include a minimum liquidity requirement equal tofinancial maintenance covenants that, as of the principallast day of any fiscal quarter ending on and after September 30, 2021, (i) require the ratio of the amount of Chart and its subsidiaries’ consolidated total net indebtedness to consolidated EBITDA to be less than the Convertible Notes outstanding six months prior toMaximum Total Net Leverage Ratio Levels and (ii) require the maturity dateratio of the Convertible Notesamount of Chart and when holders ofits subsidiaries’ consolidated EBITDA to consolidated cash interest expense to be greater than the Convertible Notes have the option to require the Company to repurchase the Convertible Notes, a maximum leverage ratio of 3.25 and a minimum interest coverage to EBITDA ratio of 3.0.Minimum Interest Coverage Ratio Levels. The required leverage ratio can be relaxed on up to two occasions, upon notification to the lenders, to 3.75 for up to four consecutive fiscal quarters, for acquisitions and plant expansions of $100,000 or greater. TheAmended SSRCF containsincludes a number of other customary covenants including, but not limited to, restrictions on the Company’sour ability to incur additional indebtedness, create liens or other encumbrances, sell assets, enter into sale and lease-back transactions, make certain payments, investments, loans, advances or guarantees, make acquisitions and engage in mergers or consolidations and pay dividends or distributions. On September 19, 2017, the Company entered into an amendment (“Amendment No. 2”) to its SSRCF to exclude the acquisition of RCHPH Holdings, Inc. (“Hudson”) (see Business Combinations footnote) from the pro forma leverage ratio requirement of the SSRCF. Concurrently with Amendment No. 2, the Company has exercised its right under the SSRCF to elect an increase in the maximum permissible leverage ratio thereunder to 3.75 for the four fiscal-quarter period ending September 30, 2018. At September 30, 2017, the Company wasMarch 31, 2023, we were in compliance with all covenants.
AsThe Amended SSRCF also contains customary events of September 30, 2017, there were $300,000 in borrowings outstanding underdefault. If such an event of default occurs, the lenders thereunder would be entitled to take various actions, including the acceleration of amounts due and all actions permitted to be taken by a secured creditor. The Amended SSRCF (“SSRCF Debt”), bearing interest at 4.00%. The Company borrowed against this facility to fund the acquisition of Hudson. For both the three and nine months ended September 30, 2017, interest expense for the SSRCF Debt was $333. The Company had $44,828 in letters of credit and bank guarantees supported by the SSRCF, which had availability of $105,172 at September 30, 2017. The obligations under the SSRCF areis guaranteed by the CompanyChart and substantially all of its U.S. subsidiaries, and secured by substantially all of the assets of the CompanyChart and its U.S. subsidiaries and 65% of the capital stock of the Company’sour material non-U.S. subsidiaries (as defined by the SSRCF)Fifth Amended and Restated Credit Agreement) that are owned by U.S. subsidiaries.

During 2022, we recorded $1.5 in deferred debt issuance costs related to the Amended SSRCF and included $7.1 in unamortized debt issuance costs from previous credit facilities.
On March 16, 2023, we entered into an amendment (“Amendment No. 2”) under the Credit Agreement. Amendment No. 2 updates the benchmark interest rate provisions to replace the London interbank offered rate (LIBOR) with a term rate based on the Secured Overnight Financing Rate (Term SOFR) as the reference rate for purposes of calculating interest under the terms of the Credit Agreement.
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CHART INDUSTRIES, INC. AND SUBSIDIARIES
Notes to the Unaudited Condensed Consolidated Financial Statements – September 30, 2017March 31, 2023
(Dollars and shares in thousands,millions, except per share amounts) – Continued



Foreign Facilities – China

During the first three months of 2023, we recorded $0.4 in deferred debt issuance costs related to Amendment No. 2 and Amendment No. 3 further described under “Term Loan” below. Deferred debt issuance costs related to the Amended SSRCF are presented in other assets in the condensed consolidated balance sheets and are being amortized over the five-year term of the Amended SSRCF. At March 31, 2023 and December 31, 2022, unamortized debt issuance costs associated with the Amended SSRCF were $8.2 and $8.4, respectively.
Term Loan
On March 17, 2023, we entered into an amendment (“Amendment No. 3”) under the Credit Agreement (as amended by Amendment No. 1, dated as of November 21, 2022, Amendment No. 2, dated as of March 16, 2023, and as further amended, restated, supplemented or otherwise modified from time to time, the “Amended Credit Agreement”), and in connection with the Howden Acquisition, we borrowed incremental term loans in the aggregate principal amount of $1,534.8 under the Amended Credit Agreement, which mature on March 18, 2030 (“Term Loan”). The Term Loan bears interest at the Term SOFR Rate plus 0.10%, plus an applicable margin of 3.75%, provided that if the adjusted rate is less than 0.50%, the rate will be deemed to be 0.50%, and are payable in equal quarterly installments beginning on June 30, 2023 in an amount equal to 0.25% of the aggregate principal amount.
Chart Cryogenic Engineering Systems (Changzhou) Company Limited (“CCESC”may elect the interest rate for Term Loan equal to (i) Adjusted Term SOFR (Term SOFR plus a credit spread adjustment of 0.10%; provided that Adjusted Term SOFR shall not be less than 0.50%) and Chart Biomedical (Chengdu) Co. Ltd. (“Chengdu”plus the Applicable Margin (3.75%), or (ii) the Alternate Base Rate (a rate per annum equal to the greatest of (a) the rate of interest last quoted by The Wall Street Journal in the U.S. as the prime rate, (b) the NYFRB Rate in effect plus 0.50%, (c) Adjusted Term SOFR for a one month Interest Period plus 1.00%, and (d) 1.50%) plus the Applicable Margin (2.75%). Chart may elect interest periods of 1, 3, or 6 months. Interest shall be payable in arrears for (a) for loans accruing interest at a rate based on Adjusted Term SOFR, at the end of each interest period and, for interest periods of greater than three months, every three months, and on the applicable maturity date and (b) for loans accruing interest based on the Alternate Base Rate, quarterly in arrears and on the applicable maturity date.
The allowance of incremental facilities is substantially identical to those in the Amended SSRCF, except (i) to permit the incurrence of a standalone letter of credit facility and (ii) that if the yield of any incremental facility that is in a U.S. dollar denominated term loan facility that is secured by liens on the collateral that is incurred within twelve months after the Closing Date, the applicable margins for the Term Loan may increase under certain circumstances. Additionally, the refinancing facilities are substantially identical to those set forth in the Amended SSRCF.
Prepayments are mandatory only in the following circumstances: (i) unless the net cash proceeds are reinvested (or committed to be reinvested) in the business within 12 months, and if so committed to be reinvested, are actually reinvested within 6 months after the initial 12-month period, after certain non-ordinary course asset sales or other non-ordinary course dispositions of property occur, (ii) 50% of excess cash flow of Chart and its subsidiaries shall be used to prepay the Term Loan, and (iii) 100% of the net cash proceeds of issuances of debt obligations of Chart and our restricted subsidiaries after the Closing Date.
Chart may prepay the Term Loan in whole or in part at any time without penalty or premium, with the exception of a repricing event with respect to all or any portion of the Term Loan that occurs on or before the date that is six months after the Closing Date.
The Term Loan will be equal in right of payment with any other senior indebtedness of Chart and, if needed, shall be subject to an equal intercreditor agreement with respect to the Amended SSRCF.
The Term Loan is guaranteed by each wholly-owned subsidiariesdomestic subsidiary that is also a guarantor under the Amended SSRCF.
Significant financial covenants and customary events of default for the Term Loan are substantially identical to those in the Amended SSRCF.
We recorded $37.6 in debt discount and $33.5 in deferred debt issuance costs associated with the Term Loan, which are being amortized over the applicable term using the effective interest method. We recorded $0.1 in interest accretion of the Term Loan discount for the three months ended March 31, 2023.
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CHART INDUSTRIES, INC. AND SUBSIDIARIES
Notes to the Unaudited Condensed Consolidated Financial Statements – March 31, 2023
(Dollars and shares in millions, except per share amounts) – Continued




The following table summarizes interest expense and financing costs amortization related to the Amended SSRCF and Term Loan:
Three Months Ended March 31,
20232022
Interest expense, senior secured revolving credit facility due October 2026$2.6 $3.3 
Interest expense, term loan due March 20305.5 — 
Interest expense, senior secured revolving credit facility due October 2026 and term loan due March 2030$8.1 $3.3 
Financing costs amortization, senior secured revolving credit facility due October 2026$0.6 $0.5 
Financing costs amortization, term loan due March 20300.1 — 
Financing costs amortization, senior secured revolving credit facility due October 2026 and term loan due March 2030$0.7 $0.5 
2024 Convertible Notes
On November 6, 2017, we issued 1.00% Convertible Senior Subordinated Notes due November 2024 (the “2024 Notes”) in the aggregate principal amount of $258.8, pursuant to an Indenture, dated as of such date (the “Indenture”). On December 31, 2020, we entered into the First Supplemental Indenture (the “Supplemental Indenture”) to the Indenture, between Chart and Wells Fargo Bank, National Association, as trustee, governing the 2024 Notes. Pursuant to the Supplemental Indenture, Chart irrevocably elected (i) to eliminate Chart’s option to elect Physical Settlement (as defined in the Indenture) on any conversion of 2024 Notes that occurs on or after the date of the Supplemental Indenture and (ii) that, with respect to any Combination Settlement (as defined in the Indenture) for a conversion of 2024 Notes, the Specified Dollar Amount (as defined in the Indenture) that will be settled in cash per $1,000 principal amount of the Notes shall be no lower than $1,000. The 2024 Notes bear interest at an annual rate of 1.00%, payable on May 15 and November 15 of each year, beginning on May 15, 2018, and will mature on November 15, 2024 unless earlier converted or repurchased.
The 2024 Notes are senior subordinated unsecured obligations of the Company and Chart Cryogenic Distribution Equipment (Changzhou) Company Limited (“CCDEC”), a joint ventureare not guaranteed by any of our subsidiaries. The 2024 Notes are senior in right of payment to our future subordinated debt, equal in right of payment with the Company’s future senior subordinated debt and are subordinated in right of payment to our existing and future senior indebtedness, including indebtedness under our existing credit agreement.
A conversion of the Company, maintain joint banking facilities (the “China Facilities”)2024 Notes may be settled in either (1) cash or (2) cash for the principal amount of the 2024 Notes and any combination of cash and shares for the excess settlement amount above the principal amount of the 2024 Notes, at our election (subject to, and in accordance with, the settlement provisions of the Indenture and Supplemental Indenture).
The initial conversion rate for the 2024 Notes is 17.0285 shares of common stock (subject to adjustment as provided for in the Indenture) per $1,000 principal amount of the 2024 Notes, which includeis equal to an initial conversion price of approximately $58.725 per share, representing a revolving facilityconversion premium of approximately 35% above the closing price of our common stock of $43.50 per share on October 31, 2017. In addition, following certain corporate events that occur prior to the maturity date as described in the Indenture, we will pay a make-whole premium by increasing the conversion rate for a holder who elects to convert its 2024 Notes in connection with 50.0 million Chinese yuan (equivalent to $7,534)such a corporate event in borrowing capacity which can be utilized for either revolving loans, bonds/guarantees, or bank draft acceptances. Any borrowings made by CCESC, CCDEC or Chengducertain circumstances. For purposes of calculating earnings per share, if the average market price of our common stock exceeds the applicable conversion price during the periods reported, shares contingently issuable under the China2024 Notes will have a dilutive effect with respect to our common stock. Since our closing common stock price of $125.40 at the end of the period exceeded the conversion price of $58.725, the if-converted value exceeded the principal amount of the 2024 Notes by approximately $293.78 at March 31, 2023. As described below, we entered into convertible note hedge transactions, which are expected to reduce the potential dilution with respect to our common stock upon conversion of the 2024 Notes.
Holders of the 2024 Notes may convert their 2024 Notes at their option at any time prior to the close of business on the business day immediately preceding August 15, 2024 only under the following circumstances: (1) during any fiscal quarter commencing after December 31, 2017 (and only during such fiscal quarter), if the last reported sale price of our common stock for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding fiscal quarter is greater than or equal to 130% of the applicable
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Notes to the Unaudited Condensed Consolidated Financial Statements – March 31, 2023
(Dollars and shares in millions, except per share amounts) – Continued




conversion price for the 2024 Notes on each applicable trading day; (2) during the five business day period after any 10 consecutive trading day period (the “measurement period”) in which the “trading price” (as defined in the Indenture) per one thousand U.S. dollar principal amount of Notes for each trading day of such measurement period was less than 97% of the product of the last reported sale price of our common stock and the applicable conversion rate for the 2024 Notes on each such trading day; or (3) upon the occurrence of specified corporate events described in the Indenture. On or after August 15, 2024 until the close of business on the second scheduled trading day immediately preceding November 15, 2024, holders may convert their 2024 Notes at the option of the holder regardless of the foregoing circumstances.
As of April 1, 2023, the 2024 Notes continue to be convertible at the option of the shareholders. This conversion right, which will remain available until June 30, 2023, was triggered since the closing price of our common stock was greater than or equal to $76.3425 (130% of the conversion price of the 2024 Notes) for at least 20 trading days during the last 30 trading days ending on March 31, 2023. Since the holders of the 2024 Notes could potentially convert their 2024 Notes at their option during the three month period subsequent to March 31, 2023, the $258.8 principal amount of the 2024 Notes was classified as a current liability in the unaudited condensed consolidated balance sheet at March 31, 2023. As of December 31, 2022, the 2024 Notes were convertible at the option of the holders, and the liability component of the 2024 Notes was classified as a current liability. We will reassess the convertibility of the 2024 Notes and the related balance sheet classification on a quarterly basis. There have been no significant conversions as of the date of this filing.
The following table summarizes 1.0% contractual interest coupon and financing costs amortization associated with the 2024 Notes:
Three Months Ended March 31,
20232022
2024 Notes, 1.0% contractual interest coupon$0.6 $0.6 
2024 Notes, financing costs amortization$0.2 $0.2 
Convertible Note Hedge and Warrant Transactions Associated with the 2024 Notes
In connection with the pricing of the 2024 Notes, we entered into convertible note hedge transactions (the “Note Hedge Transactions”) with certain parties, including the initial purchasers of the 2024 Notes (the “Option Counterparties”). The Note Hedge Transactions are expected generally to reduce the potential dilution upon any future conversion of the 2024 Notes. Payments for the Note Hedge Transactions totaled approximately $59.5 and were recorded as a reduction to additional paid-in capital in the December 31, 2017 consolidated balance sheet.
We also entered into separate, privately negotiated warrant transactions (the “Warrant Transactions”) with the Option Counterparties to acquire up to 4.41 shares of our common stock. Proceeds received from the issuance of the Warrant Transactions totaled approximately $46.0 and were recorded as an addition to additional paid-in capital in the December 31, 2017 consolidated balance sheet. The strike price of the Warrant Transactions will initially be $71.775 per share (subject to adjustment), which is approximately 65% above the last reported sale price of our common stock on October 31, 2017. The Warrant Transactions could have a dilutive effect to our stockholders to the extent that the market price per share of our common stock, as measured under the terms of the Warrant Transactions, exceeds the applicable strike price of the warrants.
The Note Hedge Transactions and Warrant Transactions effectively increased the conversion price of the 2024 Notes. The net cost of the Note Hedge Transactions and Warrant Transactions was approximately $13.5.
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Notes to the Unaudited Condensed Consolidated Financial Statements – March 31, 2023
(Dollars and shares in millions, except per share amounts) – Continued




Committed Bridge Loan Facility
We have no borrowings outstanding on the Bridge Facility and did not draw on the Bridge Facility as we secured permanent financing prior to the close of the Howden Acquisition. On November 8, 2022, in connection with the execution of the agreement to acquire Howden, the Company entered into a debt commitment letter with JPMorgan Chase Bank, N.A. and Morgan Stanley Senior Funding, Inc. (the “Commitment Parties”), pursuant to which, and subject to the terms and conditions, the Commitment Parties agreed to provide approximately $3.375 billion in aggregate principal amount of senior bridge loans under a 364-day senior bridge loan credit facility. As of December 31, 2022, the remaining availability on the Bridge Facility was amended to $1,467.1. There is no remaining availability as of the close of the Howden Acquisition and the Bridge Facility has been terminated as we secured permanent financing.
Additional Bridge Facility fees of $26.1 were incurred during the first quarter of 2023 upon successful closing of the Howden Acquisition and classified in acquisition related finance fees in the condensed consolidated statement of operations for three months ended March 31, 2023. We incurred $29.5 in Bridge Facility fees during the three months ended December 31, 2022 and paid the total of $55.6 in Bridge Facility fees at the close of the Howden Acquisition.
Interest Expense, Net
Gross interest expense for the three months ended March 31, 2023 was $48.2 and included $27.4, $12.1 and $5.5 in interest related to our Secured Notes, Unsecured Notes and Term Loan, respectively. Gross interest expense for the three months ended March 31, 2023 included $0.6 interest expense related to our convertible notes due November 2024 and $2.6 in interest related to borrowings on our senior secured revolving credit facility due 2026.
The increase in gross interest expense was partially offset by $20.1 in interest income earned from deposit of proceeds from the senior secured notes due 2030, senior unsecured notes due 2031, common stock and preferred stock offerings into interest bearing accounts until the consummation of the Howden Acquisition.
Foreign Facilities
In various markets where we do business, we have local credit facilities to meet local working capital demands, fund letters of credit and bank guarantees, and support other short-term cash requirements. The facilities generally have variable interest rates and are guaranteed by the Company. At September 30, 2017,denominated in local currency but may, in some cases, facilitate borrowings in multiple currencies. We are permitted to borrow up to USD equivalent $96.3 under certain of our foreign facilities. As of March 31, 2023 and December 31, 2022 there were no borrowings outstanding under the revolving facility, but CCESC and CCDEC had 2.6 million Chinese yuan (equivalent to $386), and 0.5 million Chinese yuan (equivalent to $78) in bank guarantees, respectively.these facilities.
CCDEC maintains an unsecured credit facility whereby CCDEC may borrow up to 30.0 million Chinese yuan (equivalent to $4,520) for working capital purposes. At September 30, 2017, there was 15.0 million Chinese yuan (equivalent to $2,260) outstanding under this facility, bearing interest at 4.35%. CCDEC was negotiating new termsCertain of this facility including a new maturity date as of the end of the third quarter of 2017.
CCESC entered into a term loan during the second quarter of 2016. The term loan is secured by certain CCESC land use rights and allows for up to 86.6 million Chinese yuan (equivalent to $13,052) in borrowings. The loan has a term of eight years with semi-annual installment payments of at least 10.0 million Chinese yuan and a final maturity date of May 26, 2024. At September 30, 2017, there was 56.6 million Chinese yuan (equivalent to $8,532) outstanding on this loan, bearing interest at 5.39%.
Foreign Facilities – Europe
Chart Ferox, a.s. (“Ferox”), a wholly-owned subsidiary of the Company, maintains a secured credit facility with capacity of up to 125.0 million Czech koruna (equivalent to $5,680) and two secured credit facilities with capacity of up to 5.6 million euros (equivalent to $6,585). All threeour foreign facilities allow Feroxus to request bank guarantees and letters of credit. None of these facilities allow revolving credit borrowings. Under two of the facilities, Ferox must pay letterWe have foreign letters of credit and guarantee fees equal to 0.70% per annum on the face amountbank guarantees that totaled USD equivalent $117.0 and $45.7 as of each guarantee or letter of credit,March 31, 2023 and under one facility, Ferox must pay the letter of credit and guarantee fees equal to 0.50%. Ferox’s land, buildings, and cash collateral secure the credit facilities. December 31, 2022, respectively.
Restricted Cash
As of September 30, 2017, there were bank guarantees of 147.1 million Czech koruna (equivalent to $6,683) supported by the Ferox credit facilities.
Chart Luxembourg maintains an overdraft facility with $5,000 in borrowing capacity. There were no borrowings under the Chart Luxembourg facility as of September 30, 2017.
Letters of Credit
Chart Energy & Chemicals, Inc. (“Chart E&C”), a wholly-owned subsidiary of the Company, has $6,442 in deposits in a bank outside of the SSRCF to secure letters of credit. The deposits are treatedMarch 31, 2023 we had $2.5 cash classified as restricted cash and restricted cash equivalents in theon our condensed consolidated balance sheets ($5,445 in other current assetssheet. As of December 31, 2022 we had restricted cash of $1,941.7 from the proceeds of the Secured Notes and $997 in other assets at September 30, 2017).Unsecured Notes which was used to fund the Howden Acquisition.
Fair Value Disclosures
The fair value of the Convertible2024 Notes was approximately 99% of their par value218% and approximately 96%201% of their par value as of September 30, 2017March 31, 2023 and December 31, 2016,2022, respectively. The Convertiblefair value of the Secured Notes and Unsecured Notes was approximately 103% and 106%, respectively, of their par value as of March 31, 2023 and 101% and 103%, respectively, of their par value as of December 31, 2022. The fair value of the Term Loan was approximately 100% of its par value as of March 31, 2023. The 2024 Notes, Secured Notes, Unsecured Notes and Term Loan are actively quoted instruments and, accordingly, thetheir fair value of the Convertible Notes wasvalues were determined using Level 1 inputs as defined in the Fair Value Measurements note. The fair value of the SSRCF Debt as of September 30, 2017 was estimated based on the present value of the underlying cash flows discounted using market interest rates. Under this method, the fair value of the SSRCF Debt approximated its carrying amount as of September 30, 2017. The Company’s SSRCF Debt was valued using observable inputs and, accordingly, the valuation is performed using Level 2 inputs as defined in the Fair Value Measurements note.
NOTE 5 — Derivative Financial Instruments
The Company utilizes certain derivative financial instruments to enhance its ability to manage foreign currency risk that exists as part of ongoing business operations. Derivative instruments are entered into for periods consistent with related underlying exposures and do not constitute positions independent of those exposures. The Company does not enter into contracts for speculative purposes, nor is it a party to any leveraged derivative instrument. The Company is exposed to foreign currency exchange risk as a result of transactions in currencies other than the functional currency of certain subsidiaries. The Company utilizes foreign currency forward purchase and sale contracts to manage the volatility associated with foreign currency purchases and certain intercompany transactions in the normal course of business. Contracts typically have maturities of less than one year. Principal currencies include the U.S. dollar, the euro, the Japanese yen, the Czech koruna, the Australian dollar, the British pound, the

inputs.
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Notes to the Unaudited Condensed Consolidated Financial Statements – September 30, 2017March 31, 2023
(Dollars and shares in thousands,millions, except per share amounts) – Continued



Canadian dollar,


NOTE 10 — Shareholders' Equity
Series B Mandatory Convertible Preferred Stock
On December 13, 2022, we completed a preferred stock offering, through which Chart issued and sold 8.050 million depositary shares, each representing a 1/20th interest in a share of Chart’s 6.75% Series B Mandatory Convertible Preferred Stock, liquidation preference $1,000.00 per share, par value $0.01 per share (the “Mandatory Convertible Preferred Stock”). The amount issued included 1.050 million depositary shares issued pursuant to the exercise in full of the option granted to the underwriters to purchase additional depositary shares. We received gross proceeds of $402.5 from the issuance of shares less $14.4 of equity issuance costs. The proceeds were used to fund our Howden Acquisition.
Dividends: Dividends on the Mandatory Convertible Preferred Stock will be payable on a cumulative basis when, as and if declared at an annual rate of 6.75% on the liquidation value of $1,000 per share. Chart may pay declared dividends in cash or, subject to certain limitations, in shares of common stock, or in any combination of cash and shares of common stock on March 15, June 15, September 15 and December 15 of each year, commencing on March 15, 2023 and ending on, and including, December 15, 2025. The accumulated but undeclared amount of dividends as of March 31, 2023 and December 31, 2022 was $1.3 and $1.4, respectively, and was treated as a reduction to income attributable to common shareholders in the computation of earnings per share.
Mandatory Conversion: Unless earlier converted, each share of the Mandatory Convertible Preferred Stock will automatically convert on the mandatory conversion date, which is expected to be December 15, 2025, into not less than 7.0520 and not more than 8.4620 shares of common stock per share of Mandatory Convertible Preferred Stock, depending on the applicable market value and subject to certain anti-dilution adjustments. Correspondingly, the conversion rate per depositary share will be not less than 0.3526 and not more than 0.4231 shares of common stock per depositary share. The conversion rate will be determined based on a preceding 20-day volume-weighted-average-price of common stock.
The following table illustrates the conversion rate per share of the Mandatory Convertible Preferred Stock, subject to certain anti-dilution adjustments, based on the applicable market value of the common stock:
Applicable Market Value of Common StockConversion Rate per Share of Mandatory Convertible Preferred Stock
Greater than $141.8037 (threshold appreciation price)7.0520 shares of common stock
Equal to or less than $141.8037 but greater than or equal to $118.1754Between 7.0520 and 8.4620 shares of common stock, determined by dividing 1000 by the applicable market value
Less than $118.1754 (initial price)8.4620 shares of common stock
The following table illustrates the conversion rate per depositary share, subject to certain anti-dilution adjustments, based on the applicable market value of the common stock:
Applicable Market Value of Common StockConversion Rate per Depositary Share
Greater than $141.8037 (threshold appreciation price)0.3526 shares of common stock
Equal to or less than $141.8037 but greater than or equal to $118.1754Between 0.3526 and 0.4231 shares of common stock, determined by dividing $50 by the applicable market value
Less than $118.1754 (initial price)0.4231 shares of common stock
Optional Conversion of the Holder: Other than during a fundamental change conversion period, at any time prior to December 15, 2025, a holder of the Mandatory Convertible Preferred Stock may elect to convert such holder’s shares of Mandatory Convertible Preferred Stock, in whole or in part, at the Minimum Conversion Rate of 7.0520 shares of common stock per share of Mandatory Convertible Preferred Stock (equivalent to 0.3526 shares of common stock per depositary share), subject to certain anti-dilution and other adjustments. Because each depositary share represents a 1/20th fractional interest in a share of Mandatory Convertible Preferred Stock, a holder of depositary shares may convert its depositary shares only in lots of 20 depositary shares.
Fundamental Change Conversion: If a fundamental change occurs on or prior to December 15, 2025, holders of the Mandatory Convertible Preferred Stock will have the right to convert their shares of Mandatory Convertible Preferred Stock, in whole or in part, into shares of common stock at the fundamental change conversion rate during the period beginning on, and
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Notes to the Unaudited Condensed Consolidated Financial Statements – March 31, 2023
(Dollars and shares in millions, except per share amounts) – Continued




including, the effective date of such fundamental change and ending on, and including, the earlier of (a) the date that is 20 calendar days after such effective date (or, if later, the date that is 20 calendar days after holders receive notice of such fundamental change) and (b) December 15, 2025. Holders who convert shares of the Mandatory Convertible Preferred Stock during that period will also receive a make-whole dividend amount comprised of a fundamental change dividend make-whole amount, and to the extent there is any, the accumulated dividend amount. Because each depositary share represents a 1/20th fractional interest in a share of the Series B Preferred Stock, a holder of depositary shares may convert its depositary shares upon a fundamental change only in lots of 20 depositary shares.
Ranking: The Mandatory Convertible Preferred Stock, with respect to anticipated dividends and distributions upon Chart’s liquidation or dissolution, or winding-up of Chart’s affairs, ranks or will rank:
•senior to our common stock and each other class or series of capital stock issued after the initial issue date of the Mandatory Convertible Preferred Stock, the terms of which do not expressly provide that such capital stock ranks either senior to the Mandatory Convertible Preferred Stock or on a parity with Mandatory Convertible Preferred Stock;
•equal with any class or series of capital stock issued after the initial issue date the terms of which expressly provide that such capital stock will rank equal with the Mandatory Convertible Preferred Stock;
•junior to the Series A Preferred Stock, if issued, and each other class or series of capital stock issued after the initial issue date that is expressly made senior to the Mandatory Convertible Preferred Stock;
•junior to our existing and future indebtedness; and
•structurally subordinated to any existing and future indebtedness of our subsidiaries as well as the capital stock of our subsidiaries held by third parties.
Voting Rights: Holders of Mandatory Convertible Preferred Stock generally will not have voting rights. Whenever dividends on shares of Mandatory Convertible Preferred Stock have not been declared and paid for six or more dividend periods (including, for the avoidance of doubt, the dividend period beginning on, and including, the initial issue date and ending on, but excluding, March 15, 2023), whether or not for consecutive dividend periods, the holders of such shares of Mandatory Convertible Preferred Stock, voting together as a single class with holders of all other series of voting preferred stock of equal rank, then outstanding, will be entitled at our next annual or special meeting of stockholders to vote for the election of a total of two additional members of our board of directors, subject to certain limitations. This right will terminate if and when all accumulated and unpaid dividends have been paid in full, or declared and a sum sufficient for such payment shall have been set aside. Upon such termination, the term of office of each preferred stock director so elected will terminate at such time and the Chinese yuan.number of directors on our board of directors will automatically decrease by two, subject to the revesting of such rights in the event of each subsequent nonpayment.
Embedded Derivatives: There are no material embedded derivatives that meet the criteria for bifurcation and separate accounting pursuant to ASC 815-15, Embedded Derivatives.
Common Stock
On December 13, 2022, we completed a public offering (the “2022 Equity Offering”), through which Chart issued and sold 5.924 million shares of common stock, $0.01 par value per share. We received gross proceeds of $700.0 from the issuance of shares less $24.9 of equity issuance costs. The Company’sproceeds were used to fund our Howden Acquisition.
On January 10, 2023, we completed a public offering (the “Partial Greenshoe”), through which Chart issued and sold 0.11 million shares of common stock, $0.01 par value per share. We received gross proceeds of $12.1 from the issuance of shares less $0.4 of equity issuance costs. The proceeds were used to fund the Howden Acquisition.
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Notes to the Unaudited Condensed Consolidated Financial Statements – March 31, 2023
(Dollars and shares in millions, except per share amounts) – Continued




NOTE 11 — Derivative Financial Instruments
Derivatives and Hedging
We utilize a combination of cross-currency swaps and foreign exchange collars (together the “Foreign Exchange Collar Contracts”) as a net investment hedge of a portion of our investments in certain international subsidiaries that use the euro as their functional currency in order to reduce the volatility caused by changes in exchange rates. As a result of our acquisition of Howden, we are also a party to foreign currency contracts not designated as hedging instruments (the “Foreign Currency Contracts”) which are used to mitigate the risk associated with cash management activities and customer forward contracts do not qualifysale agreements denominated in currencies other than the applicable local currency, and to match costs and expected revenues where production facilities have a different currency than the selling currency.
On September 16, 2022, immediately following the termination of the aforementioned cross-currency swap, we entered into a pay-fixed rate, receive-fixed rate cross-currency swap that provides for an exchange of principal on a notional amount of $99.8 swapped to euro 100.0 million on its June 30, 2025 maturity and receipt of U.S. dollar interest from our swap counterparties at a fixed rate of 1.6% per annum (the “September 16 Swap”). Concurrent to entering into the September 16 Swap, we also entered into a separate zero cost foreign exchange collar contract (the “Collar Contract”) with the same counterparty, notional amount and expiration date as hedges as defined by accounting guidance.the September 16 Swap. Under the Collar Contract, we sold a put option with a lower strike price and purchased a call option with an upper strike price to manage final settlement of the September 16 Swap. Our Foreign currency forward contractsExchange Collar Contracts are measured at fair value with changes in fair value recorded as foreign currency translation adjustments within accumulated other comprehensive loss. We classify cash flows related to our Foreign Exchange Collar Contracts as investing activities within our condensed consolidated statements of cash flows.
Our Foreign Currency Contracts are measured at fair value with changes in fair value recorded within foreign currency (gain) loss. We classify cash flows related to our Foreign Currency Contracts as operating activities within our condensed consolidated statements of cash flows. The notional value of our Foreign Currency Contracts was $346.7 as of March 31, 2023. Our derivative contracts are entered into with major financial institutions in order to reduce credit risk and recordedrisk of nonperformance by third parties. We believe the credit risks with respect to the counterparties, and the foreign currency risks that would not be hedged if the counterparties fail to fulfill their obligations under the contract, are not material in view of our understanding of the financial strength of the counterparties. Our derivative contracts are not exchange traded instruments and their fair value is determined using the cash flows of the contracts, discount rates to account for the passage of time, implied volatility, current foreign exchange market data and credit risk, which are all based on inputs readily available in public markets and categorized as Level 2 fair value hierarchy measurements.
The following table represents the fair value of our asset and liability derivatives:
Asset DerivativesLiability Derivatives
March 31,
2023		December 31,
2022		March 31,
2023		December 31,
2022
Derivatives designated as net investment hedgeBalance Sheet LocationFair ValueFair ValueBalance Sheet LocationFair ValueFair Value
Foreign Exchange Collar Contracts (1)
Other assets$— $— Other long-term liabilities$3.7 $2.7 
Total derivatives designated as net investment hedge— — 3.7 2.7 
Derivatives not designated as hedges
Foreign Currency ContractsOther current assets4.1 — Other current liabilities2.5 — 
Foreign Currency ContractsOther assets0.1 — Other long-term liabilities— — 
Total derivatives not designated as hedges4.2 — 2.5 — 
Total derivatives$4.2 $— $6.2 $2.7 
_______________
(1)Represents foreign exchange swaps and foreign exchange options.
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Notes to the Unaudited Condensed Consolidated Financial Statements – March 31, 2023
(Dollars and shares in millions, except per share amounts) – Continued




The following table represents the net effect derivative instruments designated in hedging relationships had on accumulated other comprehensive loss on the condensed consolidated balance sheets as other current assetsstatements of operations and comprehensive (loss) income:
Unrealized loss recognized in accumulated other comprehensive loss on derivatives, net of taxes
Derivatives designated as net investment hedgeThree Months Ended March 31, 2023
Foreign Exchange Collar Contracts (1) (2)
$0.8 
_______________
(1)Our designated derivative instruments are highly effective. As such, there were no gains or liabilities and reported as financial assets and liabilitieslosses recognized immediately in income related to hedge ineffectiveness during the three months ended March 31, 2023.
(2)Represents amount excluded from effectiveness testing. Our Foreign Exchange Collar Contracts are designated with terms based on the spot rate of the euro. Future changes in the Fair Value Measurements note. Changescomponents related to the spot change on the notional will be recorded in their fair valueother comprehensive income and remain there until the hedged subsidiaries are recordedsubstantially liquidated. All coupon payments are classified in interest expense, net in the condensed consolidated statements of operations and comprehensive (loss) income, and the initial value of excluded components currently recorded in accumulated other comprehensive loss as a foreign currency gains or losses. translation adjustment are amortized to interest expense, net over the remaining term of the Foreign Exchange Contract.
The Company’sfollowing table represents the effect that derivative instruments not designated as hedges had on net income:
Amount of gain (loss) recognized in income
Three Months Ended March 31,Three Months Ended March 31,
Derivatives not designated as hedgesLocation of gain (loss) recognized in income20232022
Foreign Currency ContractsForeign currency gain (loss)$2.5 $— 
The following table represents interest income, included within interest expense, net on the condensed consolidated statements of operations and comprehensive (loss) income related to amounts excluded from the assessment of hedge effectiveness for derivative instruments designated as net investment hedges:
Amount of gain recognized in income on derivative (amount excluded from effectiveness testing)
Three Months Ended March 31,Three Months Ended March 31,
Derivatives designated as net investment hedge20222022
Foreign Exchange Collar Contracts (1) (2)
$0.4 $— 
_______________
(1)Represents foreign currency forward contractsexchange swaps and foreign exchange options.
(2)Represents amount excluded from effectiveness testing. Our Foreign Exchange Collar Contracts are not exchange traded instruments and, accordingly,designated with terms based on the valuation is performed using Level 2 inputs as definedspot rate of the euro. Future changes in the Fair Value Measurements note. Gains or lossescomponents related to the spot change on settled or expired contractsthe notional will be recorded in other comprehensive income and remain there until the hedged subsidiaries are recordedsubstantially liquidated. All coupon payments are classified in interest expense, net in the condensed consolidated statements of operations and comprehensive (loss) income, and the initial value of excluded components currently recorded in accumulated other comprehensive loss as a foreign currency gains or losses.translation adjustment are amortized to interest expense, net over the remaining term of the Foreign Exchange Contract.
The changes in fair value with respect
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Notes to the Company’s foreign currency forward contracts generated a net gain of $65Unaudited Condensed Consolidated Financial Statements – March 31, 2023
(Dollars and a net loss of $32 for the three months ended September 30, 2017 and 2016, respectively. The changesshares in fair value with respect to the Company’s foreign currency forward contracts generated a net gain of $267 and a net loss of $130 for the nine months ended September 30, 2017 and 2016, respectively.millions, except per share amounts) – Continued




NOTE 612 — Product Warranties
The Company providesWe provide product warranties with varying terms and durations for the majority of itsour products. The Company estimates itsWe estimate our warranty reserve by considering historical and projected warranty claims, historical and projected cost-per-claim, and knowledge of specific product issues that are outside itsour typical experience. The Company recordsWe record warranty expense in cost of sales in the unaudited condensed consolidated statements of operations.operations and comprehensive (loss) income. Product warranty claims not expected to occur within one year are recordedincluded as part of other long-term liabilities in the long-term portion of the warranty reserve in theunaudited condensed consolidated balance sheets.
The following table represents changes in the Company’sour consolidated warranty reserve:
Balance at December 31, 2022$4.1 
Acquired29.7 
Issued – warranty expense1.1 
Warranty usage(0.7)
Balance at March 31, 2023$34.2 
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Balance at December 31, 2016$18,271
Issued – warranty expense5,510
Acquired – warranty reserve858
Change in estimate – warranty expense282
Warranty usage(9,266)
Balance at September 30, 2017$15,655
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Notes to the Unaudited Condensed Consolidated Financial Statements – March 31, 2023
(Dollars and shares in millions, except per share amounts) – Continued




NOTE 713 — Business Combinations
HudsonHowden Acquisition
On September 20, 2017, the Company and Chart Sully Corporation, a wholly owned subsidiary of the Company (“Merger Sub”),March 17, 2023 we completed the previously announced acquisition of HudsonHowden Acquisition pursuant to the termspreviously disclosed Equity Purchase Agreement dated as of the Agreement and Plan of Merger, as amended (the “Merger Agreement”), by and between Chart, Merger Sub, Hudson and R/C Hudson Holdings, L.P., solely in its capacity as the Initial Holder Representative under the Merger Agreement.November 9, 2022. The acquisition was accomplished by the merger of Merger Sub with and into Hudson, with Hudson surviving the merger as a wholly owned subsidiary of the Company (the “Acquisition”). The preliminary estimated Acquisition purchase price was $419,394, net of cash acquired, including an estimated net working capital adjustment amount of $5,894, and $3,500 in acquisition-related tax benefits acquired, as defined in the Merger Agreement. The total purchase price is subject to further adjustments. Approximately $300,000 of$4,404.9. We financed the purchase price was funded throughfor the Howden Acquisition with proceeds from borrowings under the Company’s senior secured revolving credit facility,our Amended SSRCF, Term Loan, common and the remainderpreferred stock issuance and a private offering of Secured Notes and Unsecured Notes. See Note 9, “Debt and Credit Arrangements,” for more information.
The following table shows the purchase price was fundedin accordance with cash on hand.ASC 805:
Hudson, which has operations in the United States, China and Italy and a joint venture in Mexico, designs, manufactures, sells and services products used in refining, heating, ventilation and air conditioning (HVAC), petrochemical, natural gas, power generation, industrial and commercial end markets.  Hudson
Description
Cash consideration to seller$2,788.3 
Howden’s debt settled at close1,529.0 
Settlement of seller transaction costs67.2 
Funds held in escrow20.4 
Total ASC 805 purchase price$4,404.9 
Howden is a North American leaderleading global provider of mission critical air and gas handling products providing service and support to customers around the world in air-cooled heat exchangershighly diversified end markets and ageographies. The combination of Chart and Howden is complementary and furthers our global leaderleadership position in axial flow cooling fans. Hudson’s resultshighly engineered process technologies and products serving the Nexus of operations are included in the Company’s Energy & Chemicals (“E&C”) segment since the date of the acquisition.Clean™ – clean power, clean water, clean food and clean industrials.
The CompanyWe preliminarily allocated the acquisition consideration to tangible and identifiable intangible assets acquired and liabilities assumed based on their preliminary estimated fair values as of the acquisition date. The preliminary estimated fair value of the acquired tangible and identifiable intangible assets were determined based on inputs that are unobservable and significant to the overall fair value measurement. It is also based on estimates and assumptions made by management at the time of the acquisition. As such, this was classified as Level 3 fair value hierarchy measurements and disclosures.

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Notes to Unaudited Condensed Consolidated Financial Statements – September 30, 2017
(Dollars and shares in thousands, except per share amounts) – Continued

The Company estimatedthe purchase price over the preliminary fair value of acquired unpatented technology and trademarks and trade names using the relief from royalty method. The preliminaryestimated fair values of acquired customer backlog and customer relationships were estimated using the multi-period excess earnings method. Under both the relief from royalty and multi-period excess earnings methods, the fair value models incorporate estimates of future cash flows, estimates of allocations of certain assets and cash flows, estimates of future growth rates, and management’s judgment regarding the applicable discount ratesis assigned to use to discount such estimates of cash flows. The estimated useful lives of identifiable finite-lived intangible assets range from two to 12 years.
Hudson complements Chart’s E&C segment with the addition of its Fin-Fan® brand and other air cooled heat exchangers which broaden E&C’s end market diversity from primarily liquefied natural gas, industrial and natural gas to include HVAC, petrochemical and power generation.  The addition of Hudson’s fans business, known by the Tuf-Lite® and Cofimco® brands, allows E&C to offer a broader technology solution for Chart’s customers. Management anticipates the combination of strong engineering cultures will continue to further develop full service solutions for Chart’s customers.goodwill. The preliminary estimated goodwill was established due to expected cost synergies, anticipated growth of new customers, and expansion of equipment portfolio and process technology offerings. The final assignment of goodwill to our reporting units has not yet been completed as of the benefits outlined above, as well as the benefits derived from the anticipated synergiesdate of Hudson integrating with Chart’s E&C segment.these condensed consolidated financial statements. Goodwill recorded for the Hudson acquisitionHowden Acquisition is not expected to be deductible for tax purposes.
The acquisition considerationHowden purchase price allocation below is preliminary, pending completion of the fair value analyses of acquired assets and liabilities as well as certain other analyses. The excessGiven the acquisition closed late in the first quarter of 2023, we expect adjustments in the purchase price over the estimated fair values is assigned to goodwill.allocation may be significant. As additional information becomes available, the Company maywe will further revise the preliminary acquisition consideration allocation during the remainder of the measurement period, which shall not exceed twelve months from the closing of the acquisition. Any such revisions or changes may be material.Howden Acquisition. Those areas that are subject to change include the following:
•researching and analyzing the differences between Chart accounting policies and those used by Howden,
•finalizing the valuation of working capital accounts, including assessing collectability of receivables and evaluation of saleability of inventory,
•gathering sufficient information to estimate the fair value of acquired intangible assets, including assessing projections and other assumptions used in our valuation models, and determining whether the intangible assets identified below represent a complete listing of intangible assets, and
•evaluating income tax accounting considerations, including income tax effects of the above matters.
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Notes to the Unaudited Condensed Consolidated Financial Statements – March 31, 2023
(Dollars and shares in millions, except per share amounts) – Continued




The following table summarizes the preliminary estimated fair values of the assets acquired and liabilities assumed in the Hudson acquisition:Howden Acquisition as of the acquisition date:
Net assets acquired: 
Goodwill$227,397
Identifiable intangible assets202,000
Accounts receivable34,669
Property, plant and equipment30,590
Inventories24,900
Other current assets (1)
9,359
Unbilled contract revenue4,589
Other assets2,876
Prepaid expenses873
Deferred tax liabilities(68,559)
Accounts payable(21,246)
Customer advances and billings in excess of contract revenue(16,928)
Accrued salaries, wages and benefits(4,442)
Other current liabilities(3,984)
Other long-term liabilities(1,861)
Current portion of warranty reserve(839)
    Net assets acquired$419,394
_______________
Net assets acquired:
Cash and cash equivalents$62.5 
Restricted cash2.6 
Accounts receivable461.2 
Inventories248.8 
Unbilled contract revenue194.7 
Prepaid expenses58.5 
Other current assets112.1 
Property, plant and equipment287.6 
Identifiable intangible assets2,591.0 
Equity method investments10.1 
Other assets168.1 
Accounts payable(383.7)
Customer advances and billings in excess of contract revenue(268.1)
Accrued salaries, wages and benefits(104.2)
Accrued income taxes(51.4)
Current portion of warranty reserve(28.5)
Current portion of long-term debt (1)
(1.6)
Other current liabilities(62.5)
Long-term deferred tax liabilities(729.4)
Operating lease liabilities(54.6)
Finance lease liabilities(8.1)
Accrued pension liabilities(6.4)
Other long-term liabilities(5.6)
Total identifiable net assets assumed2,493.1 
Noncontrolling interest (2)
(26.5)
Goodwill1,938.3 
Net assets acquired$4,404.9 
(1)
Pursuant to the provisionsAssets acquired net of the Merger Agreement, Hudson deposited $2,343 into a Rabbi Trust which represents amounts payable to eligible parties under Long-Term Incentive Agreements. This balance is treated as restricted cash, cash equivalents and restricted cash equivalents in the condensed consolidated balance sheets and is classified as other current assets.$4,339.8 


_______________
(1)Represents the balance related to short term debt held in Foreign Facilities. Refer to Note 9, “Debt and Credit Arrangements.”
(2)As part of the Howden Acquisition, we acquired a noncontrolling interest, which owns 82% of Howden Hua Engineering Co., Ltd, and entity based in China which is valued at $26.5.
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Notes to the Unaudited Condensed Consolidated Financial Statements – September 30, 2017March 31, 2023
(Dollars and shares in thousands,millions, except per share amounts) – Continued



Information

The following table summarizes information regarding preliminary identifiable intangible assets acquired in the Hudson acquisition is presented below:Howden Acquisition:
 Weighted-average Estimated Useful Life Preliminary Estimated Asset Fair Value
Finite-lived intangible assets:   
Customer relationships10 years $109,200
Unpatented technology12 years 19,200
Customer backlog (1)
2 years 1,200
Total finite-lived intangible assets acquired10 years 129,600
Indefinite-lived intangible assets:   
Trademarks and trade names  72,400
Total identifiable intangible assets acquired  $202,000
_______________
(1)
Weighted-average Estimated Useful LifePreliminary Estimated Asset Fair Value
Finite-lived intangible assets acquired:
Customer backlogrelationships10.0 years$1,315.0 
Backlog3.0 years359.0 
Technology and software12.0 years319.0 
Total finite-lived intangible assets acquired is included in “Patents and other” in the Goodwill and Intangible Assets note.9.1 years1,993.0 
Indefinite-lived intangible assets acquired:
Trade names598.0 
Total intangible assets acquired$2,591.0 
ForChart’s condensed consolidated financial statements include Howden’s sales and net income of $109.7 and $6.0, respectively, from date the period September 20, 2017 to September 30, 2017, net sales attributed toof acquisition through March 31, 2023. We incurred $4.9 and $25.4 in transaction related costs during the acquired Hudson operations was $6,089. Forfourth quarter of 2022 and the same period, Hudson contributed $1,202 to operating income which included $372first quarter of intangible asset amortization expense. During the three and nine months ended September 30, 2017, the Company incurred $7,254 and $8,130,2023, respectively, in acquisition related costs related to the Hudson acquisitionHowden Acquisition which were recorded in selling, general and administrative expenses inon the condensed consolidated statements of operations.operations and comprehensive (loss) income. The transaction related costs were incurred by Chart as Howden did not incur any transaction related costs after close of the Howden Acquisition and these costs are not included in Howden’s net income for our two weeks of ownership. No interest expense is allocated to Howden’s net income for our two weeks of ownership.
As part of the Howden Acquisition, we acquired defined benefit pension plans, which are predominately in Germany. As a result, we assumed pension assets of $39.1 and pension liabilities of $42.5, a net $3.4 liability.
Unaudited Supplemental Pro Forma Information
The following unaudited supplemental pro forma financial information is based on the Company’s historical condensed consolidated financial statements and Hudson’s historical condensed consolidated financial statements as adjusted to give effect to the September 20, 2017 acquisition of Hudson. The unaudited supplemental pro formacombined financial information for the periods presentedthree months ended March 31, 2023 and 2022 gives effect to the acquisitionHowden Acquisition as if it had occurred on January 1, 2016.2022. The unaudited pro forma information is not necessarily indicative of the results of operations that actually would have occurred under the ownership and management of the Company. In addition, the unaudited pro forma information is not intended to be a projection of future results and does not reflect any operating efficiencies or cost savings that might be achievable.
The following adjustments are reflected in the unaudited pro forma financial table below:
•the effect of decreasedincreased interest expense related to the repayment of the HudsonHowden term loanloans, senior notes and revolving credit facility net of the additional borrowing on the Chart senior secured revolving credit facility and senior secured and unsecured notes,
•amortization of acquired intangible assets,
•step-up depreciation of acquired property, plantan adjustment to reflect the change in the estimated income tax rate for federal and equipment,state purposes,
•inventory fair value step-up amortization expense,
nonrecurring acquisition-related expenses incurred by Howden directly attributable to the Hudson acquisition of $15,917 and $16,529Howden Acquisition were adjusted out of the pro forma net incomeloss attributable to Chart Industries, Inc. from continuing operations for the threeperiods presented, and nine months ended September 30, 2017, respectively, and
•nonrecurring acquisition-related expenses incurred by Chart directly related to the HudsonHowden acquisition of $7,254 and $8,130, were adjusted out of the pro forma net incomeloss attributable to Chart Industries, Inc. for the three and nine months ended September 30, 2017, respectively.    
This unaudited pro forma financial information is presented for informational purposes only and is not necessarily indicative of the results offrom continuing operations that actually would have resulted had the acquisition been in effect at the beginning offor the periods presented. In addition, the unaudited pro forma results are not intended to be a projection of future results and do not reflect any operating efficiencies or cost savings that might be achievable.

Three Months Ended March 31,
20232022
Pro forma sales from continuing operations$866.2 $772.6 
Pro forma net loss attributable to Chart Industries, Inc. from continuing operations(37.4)(69.9)
17
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CHART INDUSTRIES, INC. AND SUBSIDIARIES
Notes to the Unaudited Condensed Consolidated Financial Statements – September 30, 2017March 31, 2023
(Dollars and shares in thousands,millions, except per share amounts) – Continued



The following table presents pro forma sales, net income attributable to Chart Industries, Inc., and net income attributable to Chart Industries, Inc. per common share data assuming Hudson was acquired at the beginning of the 2016 fiscal year:

 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Pro forma sales$282,432
 $241,725
 $824,066
 $777,671
Pro forma net income attributable to Chart Industries, Inc.5,673
 15,434
 7,090
 36,341
        
Pro forma net income attributable to Chart Industries, Inc. per common share, basic$0.18
 $0.50
 $0.23
 $1.19
Pro forma net income attributable to Chart Industries, Inc. per common share, diluted$0.18
 $0.50
 $0.23
 $1.17
VCT Vogel GmbHFronti Fabrications, Inc. Acquisition
On AugustMay 31, 2017, Chart Germany GmbH, a wholly-owned subsidiary of the Company,2022, we acquired 100% of the equity interests of VCT Vogel GmbH (“VCT”)Fronti for an estimated purchase priceapproximately $20.6 in cash (subject to certain customary adjustments) or $20.4 net of 3.5 million euros (equivalent to $4,139), subject to$0.2 cash acquired. Fronti is a working capital adjustment. VCT, locatedspecialist in Gablingen, Germany, servicesengineering, machining and repairswelding for the cryogenic and gas industries, and also supplies new build pressure vessels and cold boxes, and performs repairs with certification to American Society of Mechanical Engineers (ASME) code. The preliminary estimated fair value of the total net assets acquired include goodwill, identifiable intangible assets and other mobile gas tank equipment and trucks. VCT also designs, manufactures and sells truck mounted drive and control systems for the operation of cryogenic pumps on trailers, rigid trucks and containers. VCT’s results are included in the Company’s Distribution & Storage (“D&S”) segment fromnet assets at the date of acquisition.acquisition in the amounts of $14.4, $5.3 and $0.9, respectively (as previously reported $14.3, $5.3 and $1.0, respectively).
Additional information related to the VCT acquisition has not been presented because the impact on the Company’s consolidated results of operations and financial position is not material.
Hetsco, Inc.CSC Cryogenic Service Center AB Acquisition
On January 13, 2017, the CompanyMay 16, 2022, we acquired 100% of the equity interests of CSC Cryogenic Service Center AB (“CSC”) for approximately $3.8 in Hetsco, Inc. from Global Power Equipment Group, Inc. for an estimated purchase price of $23,162, which was paid upon closing. cash (subject to certain customary adjustments). CSC brings a strong service footprint in the Nordic region with many overlapping customers to Chart, allowing us to broaden our service and repair presence geographically.
The purchase price allocation reported at March 31, 2017 wasallocations of Howden, Fronti Fabrications and CSC Cryogenic Service Center (the “acquisitions”) are preliminary and wasare based on provisional fair values. During the second quarter, the Company received revisedvalues and subject to revision as we finalize third-party valuations performedand other analyses and recorded $380 in accounts receivable for post-closing adjustments, which resulted in an adjusted net purchase priceanalyses. Final determination of $22,782. No adjustments were made during the third quarter of 2017. The post-closing adjustments and revised fair values resultedmay result in the followingfurther adjustments to the value of net assets acquired:acquired.
 September 30, 2017 Adjustments 
As Previously Reported
March 31, 2017
Goodwill$8,849
 $(1,271) $10,120
Identifiable intangible assets – customer relationships8,090
 810
 7,280
Other identifiable intangible assets1,150
 30
 1,120
Other net assets4,693
 51
 4,642
Net assets acquired$22,782
 $(380) $23,162
TheAs defined in Note 2, “Significant Accounting Policies” of our Annual Report on Form 10-K for the year ended December 31, 2022, we preliminarily allocated the acquisition consideration to tangible and identifiable intangible assets acquired and liabilities assumed were recorded atbased on their preliminary estimated fair values as of the acquisition date.
Hetsco, Inc. is headquartered in Franklin, Indiana The preliminary fair value of the acquired tangible and provides emergency, specialty weldingidentifiable intangible assets was determined based on inputs that are unobservable and construction services to natural gas processing, petrochemical, and air gas separation industries. Hetsco’s results are included in the Company’s E&C segment from the date of acquisition.
Pro-forma information relatedsignificant to the Hetsco, Inc. acquisition has not been presented becauseoverall fair value measurement. The preliminary fair value is based on estimates and assumptions made by management at the impact ontime of the Company’s consolidated results of operationsacquisition. As such, the acquisitions are classified as Level 3 fair value hierarchy measurements and financial position is not material.disclosures.
Contingent Consideration
The estimated fair value of contingent consideration relating to the 2015 D&S Thermax acquisition was $1,800$16.9 for our Sustainable Energy Solutions, Inc. business (“SES”) and $3.2 for our BlueInGreen, LLC business (“BIG”) at the date of acquisitionacquisitions and was valued according to a discounted cash flow approach, which includesincluded assumptions regarding the probability of achieving certain earnings targets and a discount rate applied to the potential payments. Potential payments may be paidare measured between

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CHART INDUSTRIES, INC. AND SUBSIDIARIES
Notes to Unaudited Condensed Consolidated Financial Statements – September 30, 2017
(Dollars the period commencing April 1, 2023 and shares in thousands, except per share amounts) – Continued

October 1, 2017 and July 1, 2019ending on December 31, 2028 based on the attainment of certain earnings targets. The potential payments related to Thermaxboth SES and BIG contingent consideration areon a combined basis is between $0$0.0 and $11,288.$31.0. The estimated fair value of contingent consideration related to SES decreased by $7.4 and $0.5 for the three months ended March 31, 2023 and 2022, respectively. The decrease in estimated fair value of contingent consideration related to SES during the current period was due to the lower probability of achieving technical milestones within the agreed upon time. The fair value of contingent consideration related to BIG did not change and decreased by $0.3 for the three months ended March 31, 2023 and 2022, respectively. The earn-out period for BIG ended December 31, 2022, and the payment is expected to be paid out in May 2023.
In connection with the Earthly Labs acquisition, Chart will pay to the sellers a royalty on sales of carbon capture units for residential use launched for sale to the public by Chart in an amount equal to 4% of such sales. Potential royalty payments shall be paid to the sellers during the three year period following Chart’s launch of this product. This product has not yet been developed and as such, the fair value of the contingent consideration liability that arises from this arrangement was insignificant as of March 31, 2023 and December 31, 2022.
Valuations are performed using Level 3 inputs as defined in Note 2, “Significant Accounting Policies” of our Annual Report on Form 10-K for the Fair Value Measurements noteyear ended December 31, 2022 and are evaluated on a quarterly basis based on forecasted sales and earnings targets. Contingent consideration liabilities are classified as other current liabilities and other long-term liabilities in the condensed consolidated balance sheets. Changes in fair value of contingent consideration, including accretion, are recorded as selling, general, and administrative expenses in the condensed consolidated statements of operations and comprehensive (loss) income.
The following table represents the changes in contingent consideration liabilities:
39
Balance at December 31, 2016$1,923
Decrease in fair value of contingent consideration liabilities(1,622)
Balance at September 30, 2017$301
For the nine months ended September 30, 2017, the fair value of contingent consideration decreased by $1,622, which was primarily driven by economic circumstances that significantly reduced the likelihood of achieving certain earnings targets for the duration of the remaining potential payout period. There was no change in contingent consideration for the three months ended September 30, 2017. For the three and nine months ended September 30, 2016, the fair value of contingent consideration increased by $75 and $122, respectively.
NOTE 8 — Fair Value Measurements
The Company measures its financial assets and liabilities at fair value on a recurring basis using a three-tier fair value hierarchy, which prioritizes the inputs used in the valuation methodologies. The three levels of inputs used to measure fair value are as follows:
Level 1 — Valuations based on quoted prices for identical assets and liabilities in active markets.
Level 2 — Valuations based on observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data.
Level 3 — Valuations based on unobservable inputs reflect the Company’s assumptions, consistent with reasonably available assumptions made by other market participants. These valuations require significant judgment.
Financial assets and liabilities measured at fair value on a recurring basis and presented in the Company’s condensed consolidated balance sheets are as follows:
 September 30, 2017
 Total Level 2 Level 3
Foreign currency forward contracts$20
 $20
 $—
Total financial assets$20
 $20
 $—
      
Foreign currency forward contracts$170
 $170
 $—
Contingent consideration liabilities301
 —
 301
Total financial liabilities$471
 $170
 $301

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CHART INDUSTRIES, INC. AND SUBSIDIARIES
Notes to the Unaudited Condensed Consolidated Financial Statements – September 30, 2017March 31, 2023
(Dollars and shares in thousands,millions, except per share amounts) – Continued





 December 31, 2016
 Total Level 2 Level 3
Foreign currency forward contracts$39
 $39
 $—
Total financial assets$39
 $39
 $—
      
Foreign currency forward contracts$92
 $92
 $—
Contingent consideration liabilities1,923
 —
 1,923
Total financial liabilities$2,015
 $92
 $1,923
ReferThe following table represents the changes to the Derivative Financial Instruments note for further information regarding derivative financial instruments and the Business Combinations note for further information regardingour contingent consideration liabilities.liabilities:
SESBIGTotal
Balance at December 31, 2022$16.3 $1.1 $17.4 
Decrease in fair value of contingent consideration liabilities(7.4)— (7.4)
Balance at March 31, 2023$8.9 $1.1 $10.0 
NOTE 914 — Accumulated Other Comprehensive Loss
The following tables represent changes incomponents of accumulated other comprehensive loss by component:are as follows:
 
Foreign currency translation adjustments (1)
Pension liability adjustments, net of taxesAccumulated other comprehensive loss
Balance at December 31, 2022$(50.5)$(7.5)$(58.0)
Other comprehensive income4.0 — 4.0 
Amounts reclassified from accumulated other comprehensive loss, net of income taxes— 0.1 0.1 
Net current-period other comprehensive income, net of taxes4.0 0.1 4.1 
Balance at March 31, 2023$(46.5)$(7.4)$(53.9)
Foreign currency translation adjustmentsPension liability adjustments, net of taxesAccumulated other comprehensive loss
Balance at December 31, 2021$(15.2)$(6.5)$(21.7)
Other comprehensive loss(6.1)— (6.1)
Amounts reclassified from accumulated other comprehensive loss, net of income taxes— 0.1 0.1 
Net current-period other comprehensive (loss) income, net of taxes(6.1)0.1 (6.0)
Balance at March 31, 2022$(21.3)$(6.4)$(27.7)
_______________
(1)Foreign currency translation adjustments includes translation adjustments and net investment hedge, net of taxes. See Note 11, “Derivative Financial Instruments,” for further information related to the net investment hedge.
40
 Foreign currency translation adjustments Pension liability adjustments, net of taxes Accumulated other comprehensive loss
Balance at June 30, 2017$(10,784) $(10,108) $(20,892)
Other comprehensive income6,657
 —
 6,657
Amounts reclassified from accumulated other comprehensive loss, net of income taxes of $109 (1) (3)
1,322
 201
 1,523
Net current-period other comprehensive income, net of taxes7,979
 201
 8,180
Balance at September 30, 2017$(2,805) $(9,907) $(12,712)
 Foreign currency translation adjustments Pension liability adjustments, net of taxes Accumulated other comprehensive loss
Balance at June 30, 2016$(12,506) $(11,892) $(24,398)
Other comprehensive income21
 —
 21
Amounts reclassified from accumulated other comprehensive loss, net of income taxes of $135 (1)
—
 250
 250
Net current-period other comprehensive income, net of taxes21
 250
 271
Balance at September 30, 2016$(12,485) $(11,642) $(24,127)
 Foreign currency translation adjustments Pension liability adjustments, net of taxes Accumulated other comprehensive loss
Balance at December 31, 2016$(24,701) $(10,511) $(35,212)
Other comprehensive income20,574
 —
 20,574
Amounts reclassified from accumulated other comprehensive loss, net of income taxes of $326 (2) (3)
1,322
 604
 1,926
Net current-period other comprehensive income, net of taxes21,896
 604
 22,500
Balance at September 30, 2017$(2,805) $(9,907) $(12,712)

20
CHART INDUSTRIES, INC. AND SUBSIDIARIES
Notes to the Unaudited Condensed Consolidated Financial Statements – September 30, 2017March 31, 2023
(Dollars and shares in thousands,millions, except per share amounts) – Continued




 Foreign currency translation adjustments Pension liability adjustments, net of taxes Accumulated other comprehensive loss
Balance at December 31, 2015$(12,513) $(12,391) $(24,904)
Other comprehensive income28
 —
 28
Amounts reclassified from accumulated other comprehensive loss, net of income taxes of $404 (2)
—
 749
 749
Net current-period other comprehensive income, net of taxes28
 749
 777
Balance at September 30, 2016$(12,485) $(11,642) $(24,127)

_______________
(1)
Amounts reclassified from accumulated other comprehensive loss were expensed and included in cost of sales ($122 and $152) and selling, general, and administrative expenses ($188 and $233) for the three months ended September 30, 2017 and 2016, respectively, in the condensed consolidated statements of operations and comprehensive income. The components in accumulated other comprehensive loss are included in the computation of net periodic pension expense as reported in the Employee Benefit Plans note.
(2)
Amounts reclassified from accumulated other comprehensive loss were expensed and included in cost of sales ($366 and $454) and selling, general, and administrative expenses ($564 and $699) for the nine months ended September 30, 2017 and 2016, respectively, in the condensed consolidated statements of operations and comprehensive income. The components in accumulated other comprehensive loss are included in the computation of net periodic pension expense as reported in the Employee Benefit Plans note.
(3)
For the three and nine months ended September 30, 2017, $1,322 was reclassified from accumulated other comprehensive loss to foreign currency loss in the condensed consolidated statements of operations and comprehensive income related to certain intercompany transactions.
NOTE 1015 — Earnings Per Share
The following table presentsrepresents calculations of net incomeearnings per share of common stock:
 Three Months Ended March 31,
 20232022
Amounts attributable to Chart common stockholders
(Loss) income from continuing operations$(14.6)$10.2 
Less: Mandatory convertible preferred stock dividend requirement6.8 — 
(Loss) income from continuing operations attributable to Chart(21.4)10.2 
Loss from discontinued operations, net of tax(0.4)— 
Net (loss) income attributable to Chart common stockholders(21.8)10.2 
Earnings per common share - basic:
(Loss) income from continuing operations$(0.51)$0.28 
(Loss) income from discontinued operations(0.01)— 
Net income attributable to Chart Industries, Inc.$(0.52)$0.28 
Earnings per common share – diluted:
Income from continuing operations$(0.51)$0.25 
(Loss) income from discontinued operations(0.01)— 
Net income attributable to Chart Industries, Inc.$(0.52)$0.25 
Weighted average number of common shares outstanding – basic41.94 35.83 
Incremental shares issuable upon assumed conversion and exercise of share-based awards (1)
— 0.24 
Incremental shares issuable due to dilutive effect of convertible notes (1)
— 2.56 
Incremental shares issuable due to dilutive effect of the warrants (1)
— 2.16 
Weighted average number of common shares outstanding – diluted41.94 40.79 
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Net income attributable to Chart Industries, Inc.$1,510
 $15,025
 $1,381
 $31,527
Net income attributable to Chart Industries, Inc. per common share:       
Basic$0.05
 $0.49
 $0.04
 $1.03
Diluted$0.05
 $0.48
 $0.04
 $1.02
        
Weighted average number of common shares outstanding — basic30,755
 30,585
 30,726
 30,578
Incremental shares issuable upon assumed conversion and exercise of share-based awards556
 479
 562
 362
Weighted average number of common shares outstanding — diluted31,311
 31,064
 31,288
 30,940
 _______________
Diluted(1)The weighted average common shares outstanding for the diluted (loss) earnings per share calculation for the three months ended March 31, 2023 excludes the dilutive effect of approximately 0.18 shares related to assumed conversion and exercise of share based awards, 2.40 shares related to the dilutive effect of the convertible notes and 1.95 shares related to the dilutive effect of the warrants as their inclusion would have been anti-dilutive due to our net loss. Additionally, diluted earnings per share does not reflect the following potential common shares as the effect would be anti-dilutive:
41
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Share-based awards636
 555
 676
 750
Warrants3,368
 3,368
 3,368
 3,368
Total anti-dilutive securities4,004
 3,923
 4,044
 4,118

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CHART INDUSTRIES, INC. AND SUBSIDIARIES
Notes to the Unaudited Condensed Consolidated Financial Statements – September 30, 2017March 31, 2023
(Dollars and shares in thousands,millions, except per share amounts) – Continued





 Three Months Ended March 31,
 20232022
Numerator
Mandatory convertible preferred stock dividend requirement (1)
$6.79 $— 
Denominator
Anti-dilutive shares, Share-based awards0.12 0.14 
Anti-dilutive shares, Convertible note hedge and capped call transactions (2)
2.40 2.56 
Anti-dilutive shares, Mandatory convertible preferred stock (1)
3.41 — 
Total anti-dilutive securities5.93 2.70 
 _______________
(1)We calculate the basic and diluted earnings per share based on net income, which approximates income available to common shareholders for each period. Earnings per share is calculated using the two-class method, which is an earnings allocation formula that determines the earnings per share for common stock and any participating securities according to dividends declared (whether paid or unpaid) and participation rights in undistributed earnings. The Series B Mandatory Convertible Preferred Stock and the 2024 Convertible Notes are participating securities. Undistributed earnings are not allocated to the participating securities because the participation features are discretionary. Net losses are not allocated to the Series B Mandatory Convertible Preferred Stock, as it does not have a contractual obligation to share in the losses of Chart. Basic net income per share is computed by dividing net income available to common shareholders by the weighted average number of common shares outstanding for the period. Diluted net income per common share is computed by dividing net income available to common shareholders by the sum of the weighted average number of common shares outstanding and any dilutive non-participating securities for the period.
(2)The convertible note hedge offsets any dilution upon actual conversion of the 2024 Notes up to a common stock price of $71.775 per share. For further information, refer to Note 9, “Debt and Credit Arrangements.”
NOTE 1116 — Income Taxes
The Company recorded incomeIncome tax (benefit)/expense of $1,907$(6.4) and $1,764 in$2.1 for the three months ended September 30, 2017March 31, 2023 and 2016, respectively. The Company recorded2022, respectively, represents taxes on both U.S. and foreign earnings at a combined effective income tax expenserate of $2,34632.2% and $12,829 in the nine months ended September 30, 2017 and 2016,16.5%, respectively. The effective income tax rate of 47.5% and 48.6%32.2% for the three and nine months ended September 30, 2017March 31, 2023 differed from the U.S. federal statutory rate of 35%21% primarily due to losses incurred by certain of the Company’s Chinese operations for which no benefit was recorded, partially offset by foreign exchange losses realized upon the receipt of previously taxed income, and the effect of income earned by our certain foreign entities being taxed at higher rates than the U.S. federal statutory rate, the U.S. taxation of international operations with the Company’s international entities operating in lower taxed jurisdictions. The third quarter 2017 effective income tax rate was also impacted byexpanded global footprint and transaction costs incurredfrom the Howden Acquisition offset by research and development credits and excess tax benefits associated with the acquisition of Hudson, a portion of which were non-deductible for U.S. federal income tax purposes. share-based compensation.
The effective income tax rate of 11.4% and 31.0%16.5% for the three and nine months ended September 30, 2016March 31, 2022 differed from the U.S. federal statutory rate of 35%21% primarily due to an insurance settlement for breaches of representations and warranties that resulted in an adjustment to our purchase price of Airsep shares for tax purposes and offset by lossesincome incurred by certainsome of the Company’s Chineseour foreign operations for which no benefitdetriment was recorded.
Asrecorded, partially offset by the effect of both September 30, 2017income earned by our certain foreign entities being taxed at higher rates than the U.S. federal statutory rate and December 31, 2016, the Company has a liability for gross unrecognizedexcess tax benefits of $710. This amount includes $535 of unrecognized tax benefits as of September 30, 2017, which, if ultimately recognized, would reduce the Company’s annual effective income tax rate. The Company recognizes interest and penalties related to uncertain tax positions in income tax expense. The Company accrued approximately $89 and $86 for the payment of interest and penalties as of September 30, 2017 and December 31, 2016, respectively.associated with share-based compensation.
NOTE 12 — Employee Benefit Plans
The Company has a frozen defined benefit pension plan that covers certain U.S. hourly and salaried employees. The defined benefit plan provides benefits based primarily on the participants’ years of service and compensation.
The components of net periodic pension expense are as follows:
 Three Months Ended September 30, Nine Months Ended September 30,
 2017
2016 2017 2016
Interest cost$543
 $572
 $1,627
 $1,714
Expected return on plan assets(698) (698) (2,094) (2,092)
Amortization of net loss310
 385
 930
 1,153
Total net periodic pension expense$155
 $259
 $463
 $775

The Company’s funding policy is to contribute at least the minimum funding amounts required by law. The Company contributed $3,000 to its defined benefit pension plan in the third quarter of 2017, and based upon current actuarial estimates, the Company does not expect to contribute to its defined benefit pension plan again until 2018.
NOTE 1317 — Share-based Compensation
During the ninethree months ended September 30, 2017, the CompanyMarch 31, 2023, we granted 3240.05 stock options, 1530.04 restricted stock units 7 shares of restricted stock, and 220.03 performance units. The total fair value of awards granted to employees during the ninethree months ended September 30, 2017March 31, 2023 was $13,246.$11.0. In addition, our non-employee directors received 13 stock awards with a total fair value of $487.$0.1. During the ninethree months ended September 30, 2017,March 31, 2023, participants in the Company’sour stock option plans exercised options to purchase 430.08 shares of the Company’sour common stock, while 80 stock options were forfeited and 22 stock options expired.stock.
Stock options generally vest ratably overhave a four-year graded vesting period. Restricted stock and restricted stock units generally vest ratably over a three-year period. Performance units generally vest at the end of a three-year performance period based on the achievementattainment of certain pre-determined performance conditions. Leveraged restricted share units generally vest on the third anniversary of the grant date.condition targets. During the ninethree months ended September 30, 2017, 129 shares ofMarch 31, 2023, 0.04 restricted stock and restricted stock units vested, while 25 restricted stock units were forfeited. Also, during the nine months ended September 30, 2017, 22and 0.03 performance units vested while 8 performance units were forfeited. Additionally, during the nine months ended September 30, 2017, 6 leveraged restricted share units vested.
Share-based compensation expense was $1,569$4.0 and $1,826$3.3 for the three months ended September 30, 2017March 31, 2023 and 2016, respectively. Share-based compensation expense was $9,555 and $9,014 for the nine months ended September 30, 2017 and 2016,2022, respectively. Share-based compensation expense is included in selling, general, and administrative expenses in the unaudited condensed

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CHART INDUSTRIES, INC. AND SUBSIDIARIES
Notes to Unaudited Condensed Consolidated Financial Statements – September 30, 2017
(Dollars and shares in thousands, except per share amounts) – Continued

consolidated statements of operations and comprehensive (loss) income. As of September 30, 2017,March 31, 2023, total share-based compensation of $7,298$19.7 is expected to be recognized over the weighted-average period of approximately 2.22.5 years.
On May 25, 2017,
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CHART INDUSTRIES, INC. AND SUBSIDIARIES
Notes to the Company held its annual meeting of stockholders. At the annual meeting, the Company’s stockholders approved the Chart Industries, Inc. 2017 Omnibus Equity Plan (the “2017 Omnibus Equity Plan”). As describedUnaudited Condensed Consolidated Financial Statements – March 31, 2023
(Dollars and shares in the Company’s definitive proxy statement for the annual meeting, the Company’s directors, officers and employees (including its principal executive officer, principal financial officer and other “named executive officers”) are eligible to be granted awards under the 2017 Omnibus Equity Plan.millions, except per share amounts) – Continued




NOTE 1418 — Restructuring ActivitiesCommitments and Contingencies
The Company has implemented a numberEnvironmental
We are subject to federal, state, local, and foreign environmental laws and regulations concerning, among other matters, waste water effluents, air emissions, and handling and disposal of cost reduction or avoidance actions, including headcount reductionshazardous materials, such as cleaning fluids. We are involved with environmental compliance, investigation, monitoring, and facility closures and relocations primarily relating to the consolidation ofremediation activities at certain of our owned and formerly owned manufacturing facilities and at one owned facility that is leased to a third party, and, except for these continuing remediation efforts, believe we are currently in China,substantial compliance with all known environmental regulations. Undiscounted accrued environmental reserves at both March 31, 2023 and December 31, 2022 were not material.
Legal Proceedings
Stainless Steel Cryobiological Tank Legal Proceedings
In connection with our divestiture of our cryobiological products business, Chart retained certain potential liabilities, including claims in connection with lawsuits filed in the Buffalo BioMedical respiratory consolidation,U.S. District Court for the Northern District of California and relocation of the corporate headquarters. The Buffalo Biomedical respiratory facility consolidation into Ball Ground, Georgia, was completed during the first quarter of 2017. The E&C Wuxi, China facility consolidation was completedSan Francisco Superior Court during the second quarter of 2017,2018 against Chart and other defendants with respect to the alleged failure of a stainless steel cryobiological storage tank at the Pacific Fertility Center in San Francisco, California.
The Company reached a settlement in late January 2023 to resolve these cases. This settlement resolved the prior verdict against Chart for the five federal lawsuits that went to trial in June of 2021, which was on appeal, as well as the previously disclosed Starr insurance dispute. The settlement was finalized and funded on March 20, 2023.
While the settlement was finalized and funded on March 20, 2023, we continue to evaluate the merits of the sole remaining lawsuit that is not included in the settlement in light of the information available. Based on the status of that lawsuit, a current estimate of reasonably possible losses in that case cannot be made; however, the Company does not anticipate the potential exposure to be material.
In the fourth quarter of 2022, the Company took a loss contingency accrual of $305.6 and a related loss receivable of $231.9 from insurance proceeds from these combined cases which were recognized in our consolidated balance sheet as of December 31, 2022. The net loss of approximately $73.0 was recognized in discontinued operations and represented the expected out-of-pocket, payments in connection with these settlements. The settlement was finalized and funded on March 20, 2023, therefore the loss contingency accrual and related loss receivable are no longer recorded as of March 31, 2023. This settlement and the D&S China facility consolidationnet out-of-pocket payments do not reflect third party recoveries which the Company is expectedpursuing with respect to be completed by the endunderlying facts in these cases, and which the Company currently anticipates will result in recoveries approximating one-quarter or more of 2017. Our corporate headquarters move from Garfield Heights, Ohio to Ball Ground, Georgia (which was official effective October 26, 2017) was substantially completed during the third quarter of 2017, and the Company’s Garfield Heights headquarters lease commitment ends December 31, 2017.out-of-pocket, net payments.
The following table is a summaryWe are occasionally subject to various legal claims related to performance under contracts, product liability, taxes, employment matters, environmental matters, intellectual property, and other matters incidental to the normal course of our business. Based on our historical experience in litigating these claims, as well as our current assessment of the severanceunderlying merits of the claims and other restructuringapplicable insurance, if any, management believes that the final resolution of these matters, including the Pacific Fertility Center cases described above, will not have a material adverse effect on our financial position, liquidity, cash flows, or results of operations, except that our results of operations for any particular reporting period may be adversely affected by any potential or actual loss that is accrued in such period.
NOTE 19 — Restructuring Activities
Restructuring costs which included employee-related costs, facility rentof $1.6 and exit costs, relocation, recruiting, travel and other,$0.1 for the three months ended March 31, 2023 and nine months ended September 30, 20172022 were primarily related to moving and 2016:employee severance costs relative to restructuring at our Beasley, Texas, Houston, Texas and Tulsa, Oklahoma facilities.
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Severance:       
Cost of sales$52
 $159
 $731
 $3,501
Selling, general, and administrative expenses920
 43
 2,767
 2,382
Total severance costs$972
 $202
 $3,498
 $5,883
Other restructuring:       
Cost of sales$278
 $—
 $4,072
 $—
Selling, general, and administrative expenses1,499
 103
 4,847
 420
Total other restructuring costs$1,777
 $103
 $8,919
 $420
        
Total restructuring costs$2,749
 $305
 $12,417
 $6,303
The Company isWe are closely monitoring itsour end markets and order rates and will continue to take appropriate and timely actions as necessary. The Company currently expects additional restructuring costs in the remaining three months of 2017 to be approximately $1,530 ($1,000 - D&S, $310 - BioMedical, and $220 - Corporate), but further actions may be required based on future business conditions.
The following tables summarize the Company’s restructuring activities for the three and nine months ended September 30, 2017 and 2016:
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 Three Months Ended September 30, 2017
 Energy & Chemicals Distribution & Storage BioMedical Corporate Total
Balance as of June 30, 2017$—
 $1,865
 $847
 $1,493
 $4,205
Restructuring costs162
 648
 516
 1,423
 2,749
Cash payments(157) (1,381) (803) (1,480) (3,821)
Acquired restructuring reserve194
 —
 —
 —
 194
Balance as of September 30, 2017$199
 $1,132
 $560
 $1,436
 $3,327

23
CHART INDUSTRIES, INC. AND SUBSIDIARIES
Notes to the Unaudited Condensed Consolidated Financial Statements – September 30, 2017March 31, 2023
(Dollars and shares in thousands,millions, except per share amounts) – Continued





 Three Months Ended September 30, 2016
 Energy & Chemicals Distribution & Storage BioMedical Corporate Total
Balance as of June 30, 2016$544
 $4,796
 $368
 $276
 $5,984
Restructuring costs159
 118
 —
 28
 305
Cash payments(267) (1,160) (168) (219) (1,814)
Balance as of September 30, 2016$436
 $3,754
 $200
 $85
 $4,475
The following table summarizes severance and other restructuring costs, which includes employee-related costs, facility rent and exit costs, relocation, recruiting, travel and other:
 Nine Months Ended September 30, 2017
 Energy & Chemicals Distribution & Storage BioMedical Corporate Total
Balance as of December 31, 2016$127
 $2,864
 $1,308
 $3,025
 $7,324
Restructuring costs2,245
 1,085
 4,527
 4,560
 12,417
Cash payments(2,367) (2,817) (5,275) (6,149) (16,608)
Acquired restructuring reserve194
 —
 —
 —
 194
Balance as of September 30, 2017$199
 $1,132
 $560
 $1,436
 $3,327
 Nine Months Ended September 30, 2016
 Energy & Chemicals Distribution & Storage BioMedical Corporate Total
Balance as of December 31, 2015$1,106
 $3,446
 $430
 $850
 $5,832
Restructuring costs821
 3,929
 521
 1,032
 6,303
Cash payments(1,491) (3,621) (751) (1,797) (7,660)
Balance as of September 30, 2016$436
 $3,754
 $200
 $85
 $4,475

24
Table of Contents
CHART INDUSTRIES, INC. AND SUBSIDIARIES
Notes to Unaudited Condensed Consolidated Financial Statements – September 30, 2017
(Dollars and shares in thousands, except per share amounts) – Continued

NOTE 15 — Reportable Segments
The structure of the Company’s internal organization is divided into the following reportable segments, which are also the Company’s operating segments: E&C, D&S, and BioMedical. Corporate includes operating expenses for executive management, accounting, tax, treasury, human resources, information technology, legal, internal audit, and risk management.
Three Months Ended March 31,
20232022
Severance:
Cost of sales$— $0.1 
Selling, general, and administrative expenses0.7 (0.1)
Total severance costs0.7 — 
Other restructuring:
Cost of sales— 0.1 
Selling, general, and administrative expenses0.9 — 
Total other restructuring costs0.9 0.1 
Total restructuring costs$1.6 $0.1 
The following table represents information for the Company’s reportable segments and its corporate function:tables summarize our restructuring activities:
Three Months Ended March 31, 2023
Cryo Tank SolutionsHeat Transfer SystemsSpecialty ProductsRepair, Service & LeasingCorporateConsolidated
Balance at December 31, 2022$0.1 $— $0.1 $— $— $0.2 
Restructuring charges0.8 — — 0.8 — 1.6 
Cash payments and other(0.8)— (0.1)(0.2)— (1.1)
Balance at March 31, 2023$0.1 $— $— $0.6 $— $0.7 

Three Months Ended March 31, 2022
Cryo Tank SolutionsHeat Transfer SystemsSpecialty ProductsRepair, Service & LeasingCorporateConsolidated
Balance at December 31, 2021$0.4 $0.5 $— $1.4 $— $2.3 
Restructuring charges— 0.1 — — — 0.1 
Cash payments and other(0.3)(0.6)— — — (0.9)
Balance at March 31, 2022$0.1 $— $— $1.4 $— $1.5 
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 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Sales       
Energy & Chemicals (1)
$46,588
 $23,711
 $126,473
 $122,865
Distribution & Storage139,281
 126,646
 390,057
 363,743
BioMedical54,662
 53,573
 166,309
 158,174
Consolidated$240,531
 $203,930
 $682,839
 $644,782
Operating Income (Loss) (1) (2) (3) (4)
       
Energy & Chemicals$329
 $(5,736) $(2,420) $14,190
Distribution & Storage21,016
 14,715
 49,186
 37,550
BioMedical9,539
 20,916
 24,387
 38,120
Corporate (4)
(20,436) (9,831) (50,523) (34,820)
Consolidated$10,448
 $20,064
 $20,630
 $55,040
___________
(1)
Includes results from the Hudson and Hetsco acquisitions, which are included in the Company’s E&C segment. Refer to the Business Combinations note for further details.
(2)
During the third quarter of 2016, the Company recovered for breaches of representations and warranties primarily related to warranty costs for certain product lines acquired in the 2012 acquisition of AirSep Corporation under the related representation and warranty insurance.  For the three months ended September 30, 2016, this reduced our BioMedical segment’s cost of sales by $15,145 and Corporate SG&A expenses by $859, net of associated legal fees.  For the nine months ended September 30, 2016, this reduced our BioMedical segment’s cost of sales by $15,145 and Corporate SG&A expenses by $376, net of associated legal fees recorded in the first nine months of 2016.
(3)
Includes restructuring costs of $2,749 and $305 for the three months ended September 30, 2017 and 2016, respectively, and $12,417 and $6,303 for the nine months ended September 30, 2017 and 2016 respectively.
(4)
Includes acquisition-related costs of $7,445 and $8,587 for the three and nine months ended September 30, 2017, respectively.
The following table represents total assets for the Company’s reportable segments and its corporate function:
 September 30, 2017 December 31, 2016
Total Assets   
Energy & Chemicals (1)
$782,553
 $172,494
Distribution & Storage679,350
 631,715
BioMedical165,195
 166,940
Corporate65,925
 261,933
Consolidated$1,693,023
 $1,233,082
___________
(1)
Includes assets acquired from the Hudson and Hetsco acquisitions, which are included in the Company’s E&C segment. Refer to the Business Combinations note for further details.

25

Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations
Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations
Overview
Chart Industries, Inc. and its consolidated subsidiaries (the “Company,” “Chart,” “we,” “us,” or “our”) is a leading diversified global manufacturerThe following discussion of highly engineered equipment for the industrial gas, energy, and biomedical industries. Our equipment and engineered systems are primarily used for low-temperature and cryogenic applications utilizing our expertise in cryogenic systems and equipment which operate at low temperatures sometimes approaching absolute zero (0 Kelvin; -273° Centigrade; -459° Fahrenheit).
Third Quarter and Year-to-date 2017 Highlights
Our consolidated results for the third quarter 2017 were highlighted by sales of $240.5 million, and operating income of $10.4 million, inclusive of the in quarter acquisitions.  Gross profit for the third quarter of 2017 was $70.4 million, or 29.3% of sales, which was unfavorably impacted by $0.3 million of restructuring costs.  Energy & Chemicals (“E&C”) gross margin improved sequentially from 13.3% in the second quarter of 2017 to 18.6% in the third quarter of 2017, which includes 260 basis points from the inclusion of the results of RCHPH Holdings, Inc. (“Hudson”).  The strengthoperations and financial condition should be read in gross margin was drivenconjunction with our condensed consolidated financial statements and related notes appearing elsewhere in part by restructuring and additional LNG (“Liquefied Natural Gas”) FEED projects. Distribution & Storage (“D&S”) third quarter gross margin as a percent of sales of 29.1% sequentially increased 340 basis points over the second quarter of 2017.  Continued improvement in D&S cost structurethis Quarterly Report on Form 10-Q. This discussion contains forward-looking statements. Actual results may differ materially from reductions in force taken this year combined with D&S European operational improvements contributed to the sequential increase. BioMedical third quarter gross margin as a percent of sales of 38.7% increased sequentially by 150 basis points, from 37.2% in the second quarter of 2017.  This reflects the reduced cost structure from the completion of the Buffalo, New York respiratory facility consolidation. 
Market and order activity continues to increase year to date, with $258.0 million in orders received in the quarter, inclusive of $3.8 million of orders from Hudson in the ten day Chart ownership period.  This is the fourth consecutive quarter of sequential order growth for Chart.  E&C orders in both the third and second quarters of 2017 were above $60 million, and BioMedical orders were up 7.3% sequentially over the second quarter of 2017 driven by continued demand for oxygen concentrators.  Backlog excluding third quarter acquisitions increased to $390.6 million from $367.2 millionthose discussed below. See “Forward-Looking Statements” at the end of this discussion and Item 1A. “Risk Factors” for a discussion of the second quarter of 2017.  uncertainties, risks and assumptions associated with this discussion.
Overview
We anticipate this sequential order trend will continue to increase through year end, with specific project orders expectedare a leading independent global leader in the E&C businessdesign, engineering, and manufacturing of process technologies and equipment for gas and liquid molecule handling for the Nexus of Clean™ – clean power, clean water, clean food, and clean industrials, regardless of molecule. Our unique product and solution portfolio across stationary and rotating equipment is used in D&S Asiaevery phase of the liquid gas supply chain, including engineering, service and repair from installation to preventive maintenance and digital monitoring. Chart is a leading provider of technology, equipment and services related to LNG vehicle tanks. 
On September 20, 2017, we closed on the acquisition of Hudson. The estimated purchase price is $419.4 millionliquefied natural gas, hydrogen, biogas and Hudson’s results of operationsCO2 Capture among other applications. We are includedcommitted to excellence in environmental, social and corporate governance (ESG) issues both for our E&C segment since that date.   On August 31, 2017 we closed the acquisition of VCT Vogel (“VCT”).  The estimated purchase price is $4.1 million, and VCT’s results are included in our D&S segment since that date. 
Outlook
Our 2017 full year outlook reflects continued tempered energy prices related to core LNG E&C business, year-to-date order growth in our segments and the impact of current year acquisitions (Hetsco, Inc., Hudson, and VCT).  We continue to anticipate that the forecasted global supply/demand LNG gas balance will be reached in 2022-2023, thereby driving LNG export facility orders in late 2018 / early 2019. A majority of upcoming projects for U.S. LNG export have transitioned from utilizing traditional single train base load plants to multi-train mid-scale projects, with a modular approach to achieve baseload capacities. This is important to us because multi-train mid-scale may use Chart’s patented IPSMR technologycompany as well as our brazed aluminum heat exchangercustomers. With over 48 global manufacturing locations and cold boxes41 service centers (Chart had eight service centers within non-manufacturing locations prior to the Howden Acquisition) from the United States to Asia, Australia, India, Europe and South America, we maintain accountability and transparency to our team members, suppliers, customers and communities.
Macroeconomic Impacts
During the first quarter of 2023 we had record backlog for both Chart standalone, Howden (“Howden”) standalone and the combined business. Record sales were driven by broad-based demand for our products, strong execution and continued pricing actions. The current conflict between Russia and Ukraine and the related sanctions imposed by countries against Russia as well as heightened tensions between the main liquefaction heat exchanger technology.
U.S. and China are creating uncertainty in the global economy. We are unable to predict the impact these actions will have on the global economy or on our business, financial condition and results of operations. These events did not have a material adverse effect on our reported results for the first quarter of 2023, however we will continue to investactively monitor in terms of their potential impact on our results of operations beyond the first quarter of 2023.
Foreign currency rate fluctuations, as determined by comparing current period revenue in USD to current period revenue in local currency converted to USD using the same foreign exchange rates as first quarter of 2022, had a negative impact on consolidated sales of $11.3 million for the three months ended March 31, 2023, primarily due to the U.S. dollar appreciating versus the euro and Chinese Yuan.
Environmental, Social, Governance
Chart is proud to be at the forefront of the clean energy transition as a leading provider of technology, equipment and services related to liquefied natural gas (LNG), hydrogen, biogas, carbon capture and water treatment, among other applications. We also have a unique offering for the Nexus of Clean™ – clean power, clean water, clean food and clean industrials. This leadership position is possible not only because we have the broadest offering of clean innovative solutions for the various end markets we serve, but also because we are committed to global responsibility. Reporting our ESG performance is one of the ways we demonstrate accountability and transparency to our team members, suppliers, customers, shareholders and communities. Below are some highlights of our ESG efforts, and further information can be found in our automation, process improvement,fourth Annual Sustainability report with scorecard which was released in April 2023.
•We reported a 0.52 combined Total Recordable Incident Rate (TRIR), our lowest in company history, with emphasis on safety as our #1 priority and productivity activitiesfocus on all team members being empowered and authorized to stop work if they see an unsafe or potentially unsafe situation.
•We measure progress through Sustainability Accounting Standards Board (SASB) and Task Force on Climate-Related Financial Disclosures (TCFD) indices, as well as contributing to the Global Reporting Initiative (GRI) and United Nations Sustainable Development Goals (SDGs).
•We utilize Riskmethods analytics to proactively monitor our supply chain for proper governance in our supplier network including their climate targets and other ESG activities.
•We have a Global ESG Committee, Global Safety Council, and Global Diversity & Inclusion Committee, all comprised of team member volunteers and engagement from our global locations. Howden has similar committees across their global organization.
•Our Global ESG Committee has five sub-committees focused on energy management, zero waste, electrification, renewable energy and water management.
45
•We have recently entered into a sustainability-linked banking agreement with covenants tied to our greenhouse gas (“GHG”) emission reductions’ actual performance.
•In 2021, we set a target to reduce our greenhouse gas intensity 30% across company owned operations by 2030 compared to our 2020 baseline. In 2021, we made progress towards achieving our target by reducing GHG Intensity by almost 14% year-over-year. In 2022, we reached and exceeded this goal eight years before 2030 (our goal horizon).
•In 2022, we reduced our greenhouse gas emissions not only on an intensive basis (relative to sales), but also reduced absolute emissions by 5.8%.
•In 2022, we set a new target to reduce greenhouse gas (GHG) intensity 50% by 2030 (relative to 2020).
•In 2021, we set a target to achieve carbon neutrality by 2050, and we remain committed to this goal.
•The Howden team reduced carbon emissions 23% in 2022 on an absolute basis and are well on-track to 50% reduction by 2030.
•The Howden team had 28% of its operations with zero waste to landfill in 2022.
•Howden’s mains water usage was down 7% in 2022 compared to 2021.
•Howden joined the Company,Carbon Disclosure Project (CDP) in 2021. They received a C score in 2021 and a B score in 2022.
•Howden has the following social targets in place, which the broader Chart organization has also adopted in 2022:
◦Increase female representation to 40% on our management team by 2030.
◦Increase female representation to 35% in senior roles by 2030.
◦Achieve team member volunteer participation of 25% as part of our community program by 2030.
•In terms of lowering our own emissions, we made plant improvements including energy efficient upgrades for various equipment, replacing diesel powered equipment with anticipated 2017 capital investment between $35electric and installing LED lighting in office spaces.
•We are our helping customers to achieve their own sustainability targets in a number of different ways whether that’s through reducing the amount of plastic used in packaging to lowering greenhouse gas emissions by enabling the transition towards cleaner fuels.
•Howden’s installed base of products enables the avoidance of over 245 million and $45 million.tons of CO2 a year. This is inclusiveequivalent to removing 52 million fossil-fueled cars from the road in the same period.
•In 2022, Chart products treated over 4.5 billion gallons of capacity expansionwater a day in the U.S.; produced about 65 million tons of LNG to replace coal fired power generation (non-U.S.); reduced over 600 million liters of diesel used by over-the-road trucks; and helped eliminate nearly 280 million pounds of PET (plastic) used in water bottles in the U.S.
•We have an independent Board of Directors that is comprised of seven directors (four of our seven directors are female and four of our seven are diverse) and governed with a separate independent Chairwoman and CEO.
•We hold quarterly reviews on ESG and cybersecurity with our Board of Directors.
•In 2022, Howden launched their second annual Compliance Week – a week of activities focused on building awareness and personal ownership of key aspects of compliance including anti-bribery, anti-trust, data privacy, trade compliance, agents, intellectual property, and more.
•We link our executives and their direct reports short-term incentive payout (25% of the strategic and operational goals) to a metric driven, percentage-reduction ESG metric, and have done this for two years.
•Our team volunteers in their communities with a focus on supporting children and families, ending hunger and improving health. We offer every team member worldwide one paid day off each year to volunteer in our brazed aluminum heat exchanger La Crosse, Wisconsin facility which is expectedcommunities. In 2021, Chart started matching employee donations up to be complete mid-2018 and totals approximately $24 million in capital spend, of which approximately $15 million is included in our anticipated 2017 full$250 per employee per year capital spend.to charitable organizations.
We expect full year restructuring costs to total $13.9 million of which $12.4 million has been incurred in the nine months ended September 30, 2017.  The remaining restructuring costs relate to the corporate office relocation from Garfield Heights, Ohio to Ball Ground, Georgia and consolidation of certain facilities in China.  We expect the 2017 restructuring actions to provide annualized run rate savings of $15 million beginning with•2022 was the first full year of savingsHowden’s global community volunteering program, Bright Futures. In 2022, 80% of Howden locations actively developed Bright Futures initiatives; there were 120 Bright Futures projects carried out; and 13% of team members were involved in 2018.volunteering. In 2022, Howden made donations of $76,000 in support of these communities.

•The Howden team achieved an employee engagement Net Promoter Score (eNPS) of 33, putting them in the top 25% of manufacturing companies.

•We have an employee relief fund for our own team members that need assistance.
•Our team members raised over $30,000 in 2021 and $25,000 in 2022 to support women through Dress For Success.
•In 2021, we received the following ESG-oriented recognition:
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◦World LNG Award for Energy Transition 2021 Finalist
◦Gastech 2021 Emission Reduction Champion – Organization of the Year Award Winner
◦Gastech 2021 Organisation Championing Diversity & Inclusion Finalist
◦Gastech 2021 Engineering Partnership of the Year Finalist
◦S&P Global Platts Energy Awards Excellence in LNG Finalist (2021)
◦S&P Global Platts Energy Awards Corporate Social Responsibility (Diversified) Award Finalist (2021)
•In 2022, we received the following ESG-oriented recognition:
◦S&P Global Platts Energy Awards 2022 “Energy Transition - LNG” Finalist
◦S&P Global Platts Energy Awards 2022 “Deal of the Year - Strategic” Finalist
◦2022 Frost & Sullivan Institute Enlightened Growth Leadership Award
◦goBeyondProfit’s 2022 “In Good Company Report - One of the Most Generous Companies in Georgia (USA)”
◦Hydrogen Future Awards “Hydrogen Rising Star Company of the Year” Winner (Howden)
◦Hydrogen Future Awards “Hydrogen Transport of the Year” Award (Howden)
First Quarter 2023 Highlights
With our acquisition of Howden (the “Howden Acquisition”) on March 17, 2023, our first quarter 2023 results include two weeks of Howden ownership. Strong order activity contributed to record ending total backlog of $3,932.0 million as of March 31, 2023 compared to $1,477.0 million as of March 31, 2022 and $2,338.1 million as of December 31, 2022, representing increases of $2,455.0 million or 166.2% and $1,593.9 million or 68.2%, respectively, which reflects the broad-based demand we continue to see year-over-year and quarter-over-quarter across our product categories. In addition to record ending combined backlog, Chart standalone and Howden standalone had record backlog as of March 31, 2023. The increase in backlog was largely driven by strong order activity for the three months ended March 31, 2023 of $747.7 million compared to $636.8 million as of March 31, 2022 representing an increase of $110.9 million or 17.4%. Strong order activity in our Specialty Products segment of $179.5 million for the three months ended March 31, 2023 compared to $100.5 million and $96.4 million for the three months ended March 31, 2022 and December 31, 2022, respectively, was mainly driven by strong order intake for clean energy applications during the three months ended March 31, 2023. Specialty Products segment backlog was $1,316.2 million as of March 31, 2023, also a record, as compared to $418.8 million and $645.9 million as of March 31, 2022 and December 31, 2022, respectively. Strong order activity in our Repair Service & Leasing segment of $123.7 million for the three months ended March 31, 2023 compared to $43.4 million and $66.3 million for the three months ended March 31, 2022 and December 31, 2022, respectively, was mainly driven by strong order intake for fans aftermarket, parts, repairs, and services, and field services for the Howden ownership period during the three months ended March 31, 2023. Heat Transfer Systems segment backlog was $1,590.1 million as of March 31, 2023, a record, as compared to $639.5 million and $1,300.1 million as of March 31, 2022 and December 31, 2022, respectively.
Consolidated sales increased to a record $537.9 million in the three months ended March 31, 2023 from $354.1 million in the three months ended March 31, 2022 and $441.4 million in the three months ended December 31, 2022, representing increases of $183.8 million or 51.9% and $96.5 million or 21.9%, respectively, with record sales in our Heat Transfer Systems segment driven by favorable sales in big and small-scale LNG. Sales increased to a record in our Repair, Service, & Leasing segment with favorable sales in our lifecycle business, leasing business and aftermarket fans and in our Specialty Products segment with favorable sales in space applications and hydrogen and helium applications. The consolidated sales increase was bolstered by sales from the Howden Acquisition during our two week ownership period.Consolidated gross profit increased during the three months ended March 31, 2023 compared to the three months ended March 31, 2022 by $67.8 million or 81.0% and gross profit margin for the three months ended March 31, 2023 of 28.2% increased from 23.6% for the three months ended March 31, 2022, driven by numerous pricing actions taken in 2021 and 2022, in conjunction with higher margin aftermarket, service and repair and more project work.
Outlook
Given the strong start to our synergy achievement, the continued demand in our commercial pipeline of the combined business, and our first quarter 2023 record backlog, our outlook for 2023 sales is anticipated to be in the range of $3.66 billion to $3.80 billion.
We expect to see a second quarter sequential increase in both Chart legacy and Howden’s business. Based on current customer schedules we expect to see a sequential increase in Big LNG sales and earnings in the second half 2023 compared to the first half 2023.
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Consolidated Results for the Three Months Ended September 30, 2017March 31, 2023 and 2016,2022, and June 30, 2017December 31, 2022
The following table includes key metrics used to evaluate our business and measure our performance and represents selected financial data for our operating segments for the three months ended September 30, 2017March 31, 2023 and 20162022 and June 30, 2017.December 31, 2022 (dollars in millions). Financial data for the three months ended June 30, 2017December 31, 2022 has been included to provide additional information regarding our business trends on a sequential quarter basis (dollars in thousands):basis.
Selected Financial Information
 Three Months EndedCurrent Quarter vs.
Prior Year Same Quarter		Current Quarter vs.
Prior Sequential Quarter
March 31, 2023March 31, 2022December 31, 2022Variance
 ($)		Variance
(%)		Variance
 ($)		Variance
(%)
Sales
Cryo Tank Solutions$127.2 $118.1 $126.4 $9.1 7.7 %$0.8 0.6 %
Heat Transfer Systems167.5 79.3 148.4 88.2 111.2 %19.1 12.9 %
Specialty Products127.3 107.5 117.4 19.8 18.4 %9.9 8.4 %
Repair, Service & Leasing120.1 49.3 55.2 70.8 143.6 %64.9 117.6 %
Intersegment eliminations(4.2)(0.1)(6.0)(4.1)4,100.0 %1.8 (30.0)%
Consolidated$537.9 $354.1 $441.4 $183.8 51.9 %$96.5 21.9 %
Gross Profit
Cryo Tank Solutions$22.5 $25.4 $28.9 $(2.9)(11.4)%$(6.4)(22.1)%
Heat Transfer Systems41.3 10.1 37.2 31.2 308.9 %4.1 11.0 %
Specialty Products36.2 32.6 32.4 3.6 11.0 %3.8 11.7 %
Repair, Service & Leasing51.5 15.6 25.8 35.9 230.1 %25.7 99.6 %
Consolidated$151.5 $83.7 $124.3 $67.8 81.0 %$27.2 21.9 %
Gross Profit Margin
Cryo Tank Solutions17.7 %21.5 %22.9 %
Heat Transfer Systems24.7 %12.7 %25.1 %
Specialty Products28.4 %30.3 %27.6 %
Repair, Service & Leasing42.9 %31.6 %46.7 %
Consolidated28.2 %23.6 %28.2 %
Three Months EndedCurrent Quarter vs.
Prior Year Same Quarter		Current Quarter vs.
Prior Sequential Quarter
March 31, 2023 (1)
March 31, 2022December 31, 2022Variance
 ($)		Variance
(%)		Variance
 ($)		Variance
(%)
SG&A Expenses
Cryo Tank Solutions$15.6 $10.7 $10.3 $4.9 45.8 %$5.3 51.5 %
Heat Transfer Systems9.0 6.5 5.7 2.5 38.5 %3.3 57.9 %
Specialty Products7.0 14.0 12.1 (7.0)(50.0)%(5.1)(42.1)%
Repair, Service & Leasing10.1 4.0 3.7 6.1 152.5 %6.4 173.0 %
Corporate51.9 18.3 23.4 33.6 183.6 %28.5 121.8 %
Consolidated$93.6 $53.5 $55.2 $40.1 75.0 %$38.4 69.6 %
SG&A Expenses (% of Sales)
Cryo Tank Solutions12.3 %9.1 %8.1 %
Heat Transfer Systems5.4 %8.2 %3.8 %
Specialty Products5.5 %13.0 %10.3 %
Repair, Service & Leasing8.4 %8.1 %6.7 %
Consolidated17.4 %15.1 %12.5 %
48
 Three Months Ended 
Current Quarter vs.
Prior Year Quarter
 
Current Quarter vs.
Prior Sequential Quarter
 September 30, 2017 September 30, 2016 June 30, 2017 
Variance
 ($)
 
Variance
(%)
 
Variance
 ($)
 
Variance
(%)
Sales             
Energy & Chemicals$46,588
 $23,711
 $40,018
 $22,877
 96.5 % $6,570
 16.4 %
Distribution & Storage139,281
 126,646
 137,518
 12,635
 10.0 % 1,763
 1.3 %
BioMedical54,662
 53,573
 60,677
 1,089
 2.0 % (6,015) (9.9)%
Consolidated$240,531
 $203,930
 $238,213
 $36,601
 17.9 % $2,318
 1.0 %
Gross Profit             
Energy & Chemicals$8,682
 $1,803
 $5,327
 $6,879
 381.5 % $3,355
 63.0 %
Distribution & Storage40,542
 33,429
 35,327
 7,113
 21.3 % 5,215
 14.8 %
BioMedical21,178
 34,391
 22,561
 (13,213) (38.4)% (1,383) (6.1)%
Consolidated$70,402
 $69,623
 $63,215
 $779
 1.1 % $7,187
 11.4 %
Gross Profit Margin             
Energy & Chemicals18.6% 7.6 % 13.3 %        
Distribution & Storage29.1% 26.4 % 25.7 %        
BioMedical38.7% 64.2 % 37.2 %        
Consolidated29.3% 34.1 % 26.5 %        
SG&A Expenses             
Energy & Chemicals$7,394
 $7,050
 $7,414
 $344
 4.9 % $(20) (0.3)%
Distribution & Storage18,587
 15,978
 16,924
 2,609
 16.3 % 1,663
 9.8 %
BioMedical10,918
 12,601
 11,874
 (1,683) (13.4)% (956) (8.1)%
Corporate19,815
 9,801
 13,993
 10,014
 102.2 % 5,822
 41.6 %
Consolidated$56,714
 $45,430
 $50,205
 $11,284
 24.8 % $6,509
 13.0 %
SG&A Expenses (% of Sales)             
Energy & Chemicals15.9% 29.7 % 18.5 %        
Distribution & Storage13.3% 12.6 % 12.3 %        
BioMedical20.0% 23.5 % 19.6 %        
Consolidated23.6% 22.3 % 21.1 %        
Operating Income (Loss) (1) (2)
             
Energy & Chemicals$329
 $(5,736) $(2,568) $6,065
 (105.7)% $2,897
 (112.8)%
Distribution & Storage21,016
 14,715
 16,577
 6,301
 42.8 % 4,439
 26.8 %
BioMedical9,539
 20,916
 9,848
 (11,377) (54.4)% (309) (3.1)%
Corporate (3)
(20,436) (9,831) (13,922) (10,605) 107.9 % (6,514) 46.8 %
Consolidated$10,448
 $20,064
 $9,935
 $(9,616) (47.9)% $513
 5.2 %
Operating Margin (Loss)             
Energy & Chemicals0.7% (24.2)% (6.4)%        
Distribution & Storage15.1% 11.6 % 12.1 %        
BioMedical17.5% 39.0 % 16.2 %        
Consolidated4.3% 9.8 % 4.2 %        
Operating Income (Loss) (2)
Cryo Tank Solutions
$4.9 $14.1 $17.8 $(9.2)(65.2)%$(12.9)(72.5)%
Heat Transfer Systems
27.3 (0.2)27.9 27.5 100.0 %(0.6)(2.2)%
Specialty Products (3)
22.1 16.2 19.2 5.9 36.4 %2.9 15.1 %
Repair, Service & Leasing33.8 8.3 18.7 25.5 307.2 %15.1 80.7 %
Corporate (4)
(51.9)(18.3)(23.5)(33.6)183.6 %(28.4)120.9 %
Consolidated$36.2 $20.1 $60.1 $16.1 80.1 %$(23.9)(39.8)%
Operating Margin
Cryo Tank Solutions3.9 %11.9 %14.1 %
Heat Transfer Systems16.3 %(0.3)%18.8 %
Specialty Products17.4 %15.1 %16.4 %
Repair, Service & Leasing28.1 %16.8 %33.9 %
Consolidated6.7 %5.7 %13.6 %
_______________
(1)Results for the three months endedMarch 31, 2023 include our two week ownership period of Howden after the acquisition date of March 17, 2023.
(2)Restructuring costs for the three months ended:
September 30, 2017•March 31, 2023 were $2.7 million$1.6 ($0.2 million0.8 - E&C, $0.6 millionCryo Tank Solutions and $0.8 - D&S, $0.5 million BioMedical,Repair, Service & Leasing).
•March 31, 2022 were $0.1 ($0.1 - Heat Transfer Systems and $1.4 million$0.0 - Corporate)Repair, Service & Leasing).

•December 31, 2022 were $0.1 ($0.0 - Cryo Tank Solutions and $0.0 - Specialty Products).
(3)Acquisition-related contingent consideration adjustments in our Specialty Products segment for the three months ended:
27
Table•March 31, 2023 were a decrease in fair value of Contents$7.4.

•March 31, 2022 were an increase in fair value of $0.8.

•December 31, 2022 were a decrease in fair value of $1.1.
September 30, 2016 were $0.3 million ($0.2 million - E&C(4)Includes deal-related and $0.1 million - D&S)
June 30, 2017 were $5.0 million ($1.6 million - E&C, $0.3 million - D&S, $1.4 million - BioMedical,integration costs of $81.7 for the three months ended March 31, 2023 which includes costs related to the Howden Acquisition such as interest, deal advisory and $1.7 million - Corporate)
(2)
During the third quarter of 2016, the Company recovered for breaches of representations and warranties primarily related to warranty costs for certain product lines acquired in the 2012 acquisition of AirSep Corporation under the related representation and warranty insurance.  For the three months ended September 30, 2016, this reduced our BioMedical segment’s cost of sales by $15.1 million and Corporate SG&A expenses by $0.9 million, net of associated legal fees.
(3)
Includes acquisition-related expenses of $7.4 million and $1.0 million for the three months ended September 30, 2017 and June 30, 2017, respectively.

financing costs and $4.2 and $1.6 for the three months ended March 31, 2022 and December 31, 2022, respectively.
Results of Operations for the Three Months Ended September 30, 2017March 31, 2023 and 2016,2022, and June 30, 2017December 31, 2022
Sales infor the thirdfirst quarter of 20172023 compared to the same quarter in 20162022 increased $36.6by $183.8 million, from $203.9$354.1 million to $240.5$537.9 million, or 17.9%, with increases across all segments. The largest increases were in E&C, $22.951.9% and increased by $96.5 million, from $441.4 million to $537.9 million, or 96.5%, and D&S, $12.6 million or 10.0%. E&C’s Lifecycle business, which includes results from the Hetsco acquisition, added $11.4 million in incremental sales21.9% compared to E&C during the three months ended September 30, 2017,December 31, 2022. This increase was primarily driven by growth in our Heat Transfer Systems segment on favorable sales in big and E&C’s Hudson acquisition added $6.1 millionsmall-scale LNG, within our Repair, Service & Leasing segment on favorable sales in incrementalour lifecycle business, leasing business and aftermarket fans, within our Specialty Products segment on favorable sales to E&C during thein hydrogen and helium applications and space applications and within our Cryo Tank Solutions segment on favorable sales in storage equipment and engineered tanks and systems. First quarter 2023 sales were bolstered by our two-week ownership period of ownership from September 20, 2017 through September 30, 2017. D&S saw improvement in all regions duringHowden.
Gross profit for the three months ended September 30, 2017 asfirst quarter of 2023 compared to the same quarter in 2016, with2022 increased by $67.8 million from $83.7 million to $151.5 million or 81.0%. Gross profit margin of 28.2% for the largest increase in China, driven by stronger LNG-related product sales. Sequentially over the secondfirst quarter of 2017,2023 increased from 23.6% in the overall sales increase of $2.3 million was largely driven by sales incrementally added by the Hudson acquisition. This increase was partially offset by decreased sales in cryobiological applications within the BioMedical segment.
Gross profit increased during the thirdfirst quarter of 2017 compared to the third quarter of 2016 by $0.8 million. Gross profit in the third quarter of 2016 included $15.1 million related to the impact of an insurance recovery received by the BioMedical segment for breaches of representations and warranties related to warranty costs for certain product lines acquired from AirSep Corporation (“AirSep”) in 2012.2022. The increase is primarily due to gross profit added from the Hetsco and Hudson acquisitions in our E&C segment. Gross profit further increased as a result of higher volume at better margins in the D&S segment. Excluding the impact of the insurance recovery, BioMedical’s gross profit was up compared to the prior year on slightly higher sales. Sequentially over the second quarter of 2017, the increase in gross profit of $7.2 million, or 11.4%,and the related margin was mainlyprimarily driven by the E&C segment’s incrementalnumerous pricing actions taken in 2021 and 2022, in conjunction with higher margin from the Hudson acquisitionaftermarket, service and the D&S segment, where favorable product mix drove margins higher.repair and more project work.
Consolidated SG&A expenses increased by $11.3$40.1 million or 24.8%,75.0% during the thirdfirst quarter of 20172023 compared to the thirdsame quarter of 2016. During the third quarter of 2017, Corporate incurred $7.3 million of expenses associated with the Hudson acquisition. Sequentially over the second quarter of 2017, the SG&A expenses increase wasin 2022 primarily driven by acquisition-related expenses associated with the Hudsonhigher acquisition and restructuring.employee-related costs.
Restructuring costs were related to the previously announced corporate office relocation, the Buffalo BioMedical respiratory consolidation to our Ball Ground, Georgia facilities and our Wuxi, China facility consolidation. Restructuring costs were $2.7 million in the third quarter
49
Interest Expense, Net and Financing Costs Amortization
Net interestInterest expense, net for the three months ended September 30, 2017March 31, 2023 and 20162022 was $4.8$25.5 million and $4.3$3.2 million, respectively.respectively, representing an increase of $22.3 million. The increase in interest expense, net, is primarily due to higher borrowings outstanding, specifically our senior secured notes due 2030 and senior unsecured notes due 2031, both issued on December 22, 2022 as well as borrowings related to our term loan, drawn on March 17, 2023 for the Howden Acquisition, compared to borrowings outstanding during the first quarter of 2022. The increase in interest expense, net was also driven by higher average interest rates during the first quarter of 2023 as compared to the first quarter of 2022. The increase in interest expense, net was partially offset by $20.1 million in interest income earned from deposit of proceeds from the senior secured notes due 2030, senior unsecured notes due 2031, common stock and preferred stock offerings into interest bearing accounts until the consummation of the Howden Acquisition and $0.4 million interest income from our cross-currency swaps entered into on September 16, 2022. Interest expense, net for the three months ended September 30, 2017March 31, 2023 included $1.3$27.4 million, $12.1 million and $5.5 million, in interest related to our senior secured notes, senior unsecured notes and term loan, respectively, none of which were outstanding during the first quarter of 2022. Interest expense, net for both the three months ended March 31, 2023 and 2022 included $0.6 million of 2.0%1.0% cash interest $3.4 million of non-cash interest accretion expense related to the carrying value of the Convertible Notes,our convertible notes due November 2024 and $0.3$2.6 million and $3.3 million, respectively, in interest related to borrowings on our senior secured revolving credit facility due 2026. Financing costs amortization was $2.8 million and $0.7 million for the Hudson acquisition. For each of the three months ended September 30, 2017March 31, 2023 and 2016, financing costs amortization2022, respectively. The increase of $2.1 million was $0.3primarily due to the amendment of our senior secured revolving credit facility due 2026, the issuance of senior secured notes due 2030 and senior unsecured notes due 2031 during the fourth quarter of 2022 as well as the issuance of our term loan, all of which increased deferred debt issuance costs.
Unrealized Loss On Investments In Equity Securities
During the first quarter of 2023, we recognized an unrealized loss on investments in equity securities of $2.0 million, which was driven by an unrealized loss of $0.5 million on the mark-to-market adjustment of our investment in McPhy and a $2.5 million unrealized gain on the mark-to-market adjustment of our investment in Stabilis. During first quarter of 2022, we recognized an unrealized loss of $2.6 million, which was driven by a $3.7 million unrealized loss on the mark-to-market adjustment of our investment in McPhy, partially offset by a $1.1 million unrealized gain on the mark-to-market adjustment of our investment in Stabilis.
Foreign Currency (Gain) Loss
For the three months ended March 31, 2023, foreign currency gain was $1.1 million and for the three months ended March 31, 2022 foreign currency loss was $1.6 million.

28

The variance between periods was primarily driven by fluctuations in the U.S. dollar as compared to the euro and Chinese yuan. Foreign currency (gain) loss relates to transaction gains and losses arising from fluctuations in currency exchange rates on transactions denominated in currencies other than the functional currency.
Income Tax Expense
Income tax (benefit)/expense of $1.9$(6.4) million and $1.8$2.1 million for the three months ended September 30, 2017March 31, 2023 and 2016,2022, respectively, represents taxes on both U.S. and foreign earnings at a combined effective income tax rate of 47.5%32.2% and 11.4%16.5%, respectively. The effective income tax rate of 47.5%32.2% for the third quarterthree months ended March 31, 2023 differed from the U.S. federal statutory rate of 2017 was21% primarily due to one-time impacts from acquisitions and income earned by our certain foreign entities being taxed at higher rates than the U.S. federal statutory rate, offset by research and development credits and excess tax benefits associated with share-based compensation.
The effective income tax rate of 35%16.5% for the three months ended March 31, 2022 differed from the U.S. federal statutory rate of 21% primarily due to lossesincome incurred by certainsome of our Chineseforeign operations for which no tax benefitdetriment was recorded, partially offset by the effect of income earned by our certain of our internationalforeign entities operating in lowerbeing taxed jurisdictions. The third quarter 2017 effective income tax rate was also impacted by transaction costs incurred with the acquisition of Hudson, a portion of which were non-deductible for U.S. federal income tax purposes. The effective income tax rate of 11.4% for the three months ended September 30, 2016 differed fromat higher rates than the U.S. federal statutory rate of 35% primarily due to the insurance settlement for breaches of representations and warranties that resulted in an adjustment to our purchase price of Airsep shares forexcess tax purposes and was offset by losses incurred by certain of our Chinese operations for which no benefit was recorded.benefits associated with share-based compensation.
Net (Loss) Income Attributable to Chart Industries, Inc. from Continuing Operations
As a result of the foregoing, net (loss) income attributable to the CompanyChart Industries, Inc. from continuing operations for the three months ended September 30, 2017March 31, 2023 and 20162022 was $1.5$(14.6) million and $15.0$10.2 million, respectively.

29

Consolidated Results for the Nine Months Ended September 30, 2017 and 2016
The following table includes key metrics used to evaluate our business and measure our performance and represents selected financial data for our operating segments for the nine months ended September 30, 2017 and 2016 (dollars in thousands):
Selected Financial Information
 Nine Months Ended Current Year-to-date vs.
Prior Year-to-date Period
 September 30, 2017 September 30, 2016 
Variance
 ($)
 
Variance
(%)
Sales       
Energy & Chemicals$126,473
 $122,865
 $3,608
 2.9 %
Distribution & Storage390,057
 363,743
 26,314
 7.2 %
BioMedical166,309
 158,174
 8,135
 5.1 %
Consolidated$682,839
 $644,782
 $38,057
 5.9 %
Gross Profit       
Energy & Chemicals$22,434
 $39,147
 $(16,713) (42.7)%
Distribution & Storage106,417
 96,074
 10,343
 10.8 %
BioMedical60,426
 74,054
 (13,628) (18.4)%
Consolidated$189,277
 $209,275
 $(19,998) (9.6)%
Gross Profit Margin       
Energy & Chemicals17.7 % 31.9%    
Distribution & Storage27.3 % 26.4%    
BioMedical36.3 % 46.8%    
Consolidated27.7 % 32.5%    
SG&A Expenses       
Energy & Chemicals$22,610
 $23,295
 $(685) (2.9)%
Distribution & Storage53,269
 52,517
 752
 1.4 %
BioMedical33,609
 33,288
 321
 1.0 %
Corporate49,858
 34,762
 15,096
 43.4 %
Consolidated$159,346
 $143,862
 $15,484
 10.8 %
SG&A Expenses (% of Sales)       
Energy & Chemicals17.9 % 19.0%    
Distribution & Storage13.7 % 14.4%    
BioMedical20.2 % 21.0%    
Consolidated23.3 % 22.3%    
Operating (Loss) Income (1) (2)
       
Energy & Chemicals$(2,420) $14,190
 $(16,610) (117.1)%
Distribution & Storage49,186
 37,550
 11,636
 31.0 %
BioMedical24,387
 38,120
 (13,733) (36.0)%
Corporate (3)
(50,523) (34,820) (15,703) 45.1 %
Consolidated$20,630
 $55,040
 $(34,410) (62.5)%
Operating (Loss) Margin       
Energy & Chemicals(1.9)% 11.5%    
Distribution & Storage12.6 % 10.3%    
BioMedical14.7 % 24.1%    
Consolidated3.0 % 8.5%    
_______________
(1) Restructuring costs for the nine months ended:
September 30, 2017 were $12.4 million, ($2.2 million - E&C, $1.1 million - D&S, $4.5 million BioMedical, and $4.6 million - Corporate)
September 30, 2016 were $6.3 million ($0.8 million - E&C, $3.9 million - D&S, $0.5 million BioMedical, and $1.1 million - Corporate)

30

(2)
During the third quarter of 2016, the Company recovered for breaches of representations and warranties primarily related to warranty costs for certain product lines acquired in the 2012 acquisition of AirSep Corporation under the related representation and warranty insurance.  For the nine months ended September 30, 2016, this reduced our BioMedical segment’s cost of sales by $15,145 and Corporate SG&A expenses by $376, net of associated legal fees recorded in the first nine months of 2016.
(3)
Includes acquisition-related expenses of $8.6 million for the nine months ended September 30, 2017.
Results of Operations for the Nine Months Ended September 30, 2017 and 2016
Sales in the nine months ended September 30, 2017 increased in all segments compared to the nine months ended September 30, 2016, by $38.1 million or 5.9%, primarily driven by stronger sales in D&S as a result of increased sales in bulk and packaged gas industrial applications, especially in the U.S and China. E&C sales include $37.6 million of incremental sales from Lifecycle, which includes the Hetsco acquisition, and the Hudson acquisition which added $6.1 million in incremental sales to E&C during the period of ownership from September 20, 2017 through September 30, 2017. E&C segment sales in 2016 included several short-lead time replacement equipment sales and contract expiration fees.
Gross profit decreased $20.0 million, and the related margin decreased from 32.5% to 27.7% during the first nine months of 2017 compared to the first nine months of 2016. The prior year included several high margin short-lead time replacement equipment sales and contract expiration fees in our E&C segment that did not recur in 2017 as well as the BioMedical insurance recovery for breaches of representations and warranties related to warranty costs for certain product lines acquired from AirSep in 2012. For the nine months ended September 30, 2016, this reduced BioMedical’s cost of sales by $15.1 million and added 9.6% to the year-to-date gross margin.
SG&A expenses increased by $15.5 million during the first nine months of 2017 compared to the first nine months of 2016. During the first nine months of 2017, Corporate incurred $8.6 million in acquisition-related costs, of which $8.1 million related to the Hudson acquisition. Restructuring expenses increased $6.1 million as further discussed below.
Restructuring costs of $12.4 million for the first nine months of 2017 were recorded in cost of goods sold ($4.8 million) and SG&A ($7.6 million) as a result of our cost reduction and operating efficiency initiatives primarily related to the corporate office relocation, the Buffalo BioMedical respiratory consolidation to our Ball Ground, Georgia facilities and our China facilities consolidation. Restructuring costs of $6.3 million for the first nine months of 2016 were recorded in cost of goods sold ($3.5 million) and SG&A ($2.8 million).
Interest Expense, Net and Financing Costs Amortization
Net interest expense for the nine months ended September 30, 2017 and 2016 was $13.0 million and $12.6 million, respectively. Interest expense for the nine months ended September 30, 2017 included $3.8 million of 2.0% cash interest, $10.0 million of non-cash interest accretion expense related to the carrying value of the Convertible Notes and $0.3 million in interest related to borrowings on our senior secured revolving credit facility for the Hudson acquisition. For each of the nine months ended September 30, 2017 and 2016, financing costs amortization was $1.0 million.
Income Tax Expense
Income tax expense of $2.3 million and $12.8 million for the nine months ended September 30, 2017 and 2016, respectively, represents taxes on both U.S. and foreign earnings at a combined effective income tax rate of 48.6% and 31.0%, respectively. The effective income tax rate of 48.6% for the nine months ended September 30, 2017 was higher than the U.S. federal statutory rate of 35% primarily due to losses incurred by certain of the Company’s Chinese operations for which no benefit was recorded, partially offset by foreign exchange losses realized upon the receipt of previously taxed income and the effect of income earned by certain of the Company’s international entities operating in lower taxed jurisdictions. During the nine months ended September 30, 2017, the effective income tax rate was also impacted by transaction costs incurred with the acquisition of Hudson, a portion of which were non-deductible for U.S. federal income tax purposes. The effective income tax rate of 31.0% for the nine months ended September 30, 2016 differed from the U.S. federal statutory rate of 35% primarily due to the insurance settlement for breaches of representations and warranties that resulted in an adjustment to our purchase price of Airsep shares for tax purposes and offset by losses incurred by certain of our Chinese operations for which no benefit was recorded.
Net Income
As a result of the foregoing, net income attributable to the Company for the nine months ended September 30, 2017 and 2016 was $1.4 million and $31.5 million, respectively.

31

Segment Results
The structure of the Company’s internal organization is divided into the followingOur reportable and operating segments which are also the Company’s operating segments: E&C, D&S,include: Cryo Tank Solutions, Heat Transfer Systems, Specialty Products and BioMedical.Repair, Service & Leasing. Corporate includes operating expenses for executive management, accounting, tax, treasury, corporate development, human resources, information technology, investor relations, legal, internal audit, and risk management.
50
Corporate support functions are not currently allocated to the segments. For further information, refer to Note 3, “Reportable Segments” of our Reportable Segments note to ourunaudited condensed consolidated financial statements included elsewhereunder Item 1, “Financial Statements” in this report. The following tables include key metrics used to evaluate our business and measure our performance and representsrepresent selected financial data for our operating segments for the three and nine months ended September 30, 2017March 31, 2023 and 20162022 (dollars in thousands)millions):
Energy & Chemicals
Cryo Tank Solutions — Results of Operations for the Three Months Ended September 30, 2017March 31, 2023 and 20162022
Three Months Ended Current Quarter vs.
Prior Year Quarter		Three Months EndedCurrent Quarter vs.
Prior Year Same Quarter
September 30, 2017 September 30, 2016 
Variance
 ($)
 
Variance
(%)
March 31, 2023March 31, 2022Variance
($)		Variance
(%)
Sales$46,588
 $23,711
 $22,877
 96.5 %Sales$127.2 $118.1 $9.1 7.7 %
Gross Profit8,682
 1,803
 6,879
 381.5 %Gross Profit22.5 25.4 (2.9)(11.4)%
Gross Profit Margin18.6% 7.6 %    Gross Profit Margin17.7 %21.5 %
SG&A Expenses$7,394
 $7,050
 $344
 4.9 %SG&A Expenses$15.6 $10.7 $4.9 45.8 %
SG&A Expenses (% of Sales)15.9% 29.7 %    SG&A Expenses (% of Sales)12.3 %9.1 %
Operating (Loss) Income$329
 $(5,736) $6,065
 (105.7)%
Operating (Loss) Margin0.7% (24.2)%    
Operating IncomeOperating Income$4.9 $14.1 $(9.2)(65.2)%
Operating MarginOperating Margin3.9 %11.9 %
For the thirdfirst quarter of 2017, E&C segment2023, Cryo Tank Solutions sales increased by $9.1 million as compared to the same quarter in 2016. E&C’s Lifecycle business, which includes2022. Similar to the comments previously mentioned in the consolidated results from the Hetsco acquisition, added $11.4 million in incremental sales to E&C during the three months ended September 30, 2017, and E&C’s Hudson acquisition added $6.1 million in incremental sales to E&C during the period of ownership from September 20, 2017 through September 30, 2017. Overall,section, the increase was mainly due to favorable sales in storage equipment and engineered tanks and systems partially offset by lower mobile equipment sales was driven primarily by a continued increase in activity inChina and Europe.
During the Natural Gas Liquids (“NGL”) and Petrochemical applications, while lower energy prices continued to have an impact on LNG related opportunities within the E&C segment.
For the thirdfirst quarter of 2017, E&C2023, Cryo Tank Solutions segment gross profit and the related margin increaseddecreased by $2.9 million as compared to the same quarter in 2016 primarily2022, and gross profit margin decreased by 380 basis points. The decrease in gross profit and the related margin was mainly driven by higher material prices and higher labor costs due to an increase in high margin short lead-time replacement equipment projects and improved productivity driven by the volume increase in the NGL and Petrochemical applications.macroeconomic conditions.
E&CCryo Tank Solutions segment SG&A expenses increased slightlyby $4.9 million during the thirdfirst quarter of 20172023 as compared to the same quarter in 2016 primarily driven by incremental2022. The increase in SG&A expenses from the Hetsco and Hudson acquisitions.was mainly due to higher employee-related costs.
Heat Transfer Systems — Results for the Nine Months Ended September 30, 2017 and 2016
 Nine Months Ended Current Year-to-date vs.
Prior Year-to-date Period
 September 30, 2017 September 30, 2016 
Variance
 ($)
 
Variance
(%)
Sales$126,473
 $122,865
 $3,608
 2.9 %
Gross Profit22,434
 39,147
 (16,713) (42.7)%
Gross Profit Margin17.7 % 31.9%    
SG&A Expenses$22,610
 $23,295
 $(685) (2.9)%
SG&A Expenses (% of Sales)17.9 % 19.0%    
Operating (Loss) Income$(2,420) $14,190
 $(16,610) (117.1)%
Operating (Loss) Margin(1.9)% 11.5%    
For the first nine months of 2017, E&C segment sales increased as compared to the same period in 2016. The increase was primarily driven by our Lifecycle business, which includes the Hetsco acquisition, which contributed $39.8 million in sales during the first nine months of 2017 compared to $2.2 million in sales during the prior-year period. Additionally, the Hudson acquisition added $6.1 million of sales in the current year. These increases were largely offset by more significant short lead-time replacement equipment sales in 2016 as compared to 2017. Overall, E&C sales performance during the first nine months of 2017 was primarily

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driven by an increase in activity in the NGL and Petrochemical applications, while lower energy prices continued to have an impact on LNG related opportunities.
E&C gross profit and the related margin decreased during the first nine months of 2017 as compared to the same period in 2016. Included in 2016 were several short lead-time replacement equipment sales and contract expiration fees which contributed approximately $31 million of gross profit during 2016.
E&C segment SG&A expenses decreased during the first nine months of 2017 as lower employee-related costs, short-term variable compensation incentives, bad debt expense and headcount reductions were partially offset by incremental SG&A expenses added by the Hetsco and Hudson acquisitions.
Distribution & Storage
ResultsOperations for the Three Months Ended September 30, 2017March 31, 2023 and 20162022
Three Months EndedCurrent Quarter vs.
Prior Year Same Quarter
March 31, 2023March 31, 2022Variance
($)		Variance
(%)
Sales$167.5 $79.3 $88.2 111.2 %
Gross Profit41.3 10.1 31.2 308.9 %
Gross Profit Margin24.7 %12.7 %
SG&A Expenses$9.0 $6.5 $2.5 38.5 %
SG&A Expenses (% of Sales)5.4 %8.2 %
Operating Income (Loss)$27.3 $(0.2)$27.5 100.0 %
Operating Margin16.3 %(0.3)%
 Three Months Ended Current Quarter vs.
Prior Year Quarter
 September 30, 2017 September 30, 2016 
Variance
 ($)
 
Variance
(%)
Sales$139,281
 $126,646
 $12,635
 10.0%
Gross Profit40,542
 33,429
 7,113
 21.3%
Gross Profit Margin29.1% 26.4%    
SG&A Expenses$18,587
 $15,978
 $2,609
 16.3%
SG&A Expenses (% of Sales)13.3% 12.6%    
Operating Income$21,016
 $14,715
 $6,301
 42.8%
Operating Margin15.1% 11.6%    
D&SFor the first quarter of 2023, Heat Transfer Systems segment sales increased during the third quarter of 2017by $88.2 million as compared to the same quarter in 20162022. Similar to the comments previously mentioned in the consolidated results section, the increase was primarily due to a $7.8 million increasedriven by favorable sales in sales for liquefied natural gas applications, a $2.2 million increase in packaged gas industrial applications,big and a $2.6 million increase in bulk industrial gas applications.small-scale LNG.
D&SDuring the first quarter of 2023, Heat Transfer Systems segment gross profit increased during the third quarter of 2017by $31.2 million as compared to the same quarter in 2016 mainly driven2022, while gross profit margin increased by 1,200 basis points. The increase in gross profit was primarily due to higher volume across all regions, and the related margin increased primarily due to favorable product mix.
D&S segment SG&A expenses increased during the third quarter of 2017 as compared to the same quarter in 2016 mainly due to higher employee-related costsoverall product and restructuring expense.project volume mix.
Results for the Nine Months Ended September 30, 2017 and 2016
 Nine Months Ended Current Year-to-date vs.
Prior Year-to-date Period
 September 30, 2017 September 30, 2016 
Variance
 ($)
 
Variance
(%)
Sales$390,057
 $363,743
 $26,314
 7.2%
Gross Profit106,417
 96,074
 10,343
 10.8%
Gross Profit Margin27.3% 26.4%    
SG&A Expenses$53,269
 $52,517
 $752
 1.4%
SG&A Expenses (% of Sales)13.7% 14.4%    
Operating Income$49,186
 $37,550
 $11,636
 31.0%
Operating Margin12.6% 10.3%    
D&S segment sales increased during the first nine months of 2017 as compared to the same period in 2016 mainly due to $22.8 million increase in sales for liquefied natural gas applications and a $13.2 million increase in packaged gas industrial applications, partially offset by a $9.7 million decrease in bulk industrial gas applications.
D&S segment gross profit increased during the first nine months of 2017 as compared to the same period in 2016 mainly driven by higher volume across all regions, and the related margin increased, especially in Asia, primarily due to improved execution.
D&SHeat Transfer Systems segment SG&A expenses increased during the first nine months of 2017 as compared to the same period in 2016 mainly due to higher employee-related costs and were partially offset by the impact of a reduction in a contingent consideration

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liability associated with a prior acquisition, which was recorded during the nine months ended September 30, 2017, and lower restructuring costs.
BioMedical
Results for the Three Months Ended September 30, 2017 and 2016
 Three Months Ended Current Quarter vs.
Prior Year Quarter
 September 30, 2017 September 30, 2016 
Variance
 ($)
 
Variance
(%)
Sales$54,662
 $53,573
 $1,089
 2.0 %
Gross Profit21,178
 34,391
 (13,213) (38.4)%
Gross Profit Margin38.7% 64.2%    
SG&A Expenses$10,918
 $12,601
 $(1,683) (13.4)%
SG&A Expenses (% of Sales)20.0% 23.5%    
Operating Income$9,539
 $20,916
 $(11,377) (54.4)%
Operating Margin17.5% 39.0%    
For the third quarter of 2017, the BioMedical segment sales increase was primarily driven by respiratory therapy equipment applications2023 as compared to the same quarter in 2016.2022 while SG&A expenses as a percentage of sales improved by 280 basis points. The increase in SG&A expenses was mainly due to higher employee-related costs.
During
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Specialty Products — Results of Operations for the thirdThree Months Ended March 31, 2023 and 2022
Three Months EndedCurrent Quarter vs.
Prior Year Same Quarter
 March 31, 2023March 31, 2022Variance
($)		Variance
(%)
Sales$127.3 $107.5 $19.8 18.4 %
Gross Profit36.2 32.6 3.6 11.0 %
Gross Profit Margin28.4 %30.3 %
SG&A Expenses$7.0 $14.0 $(7.0)(50.0)%
SG&A Expenses (% of Sales)5.5 %13.0 %
Operating Income$22.1 $16.2 $5.9 36.4 %
Operating Margin17.4 %15.1 %
Specialty Products segment sales increased by $19.8 million during the first quarter of 2017, BioMedical segment gross profit decreased2023 as compared to the same quarter in 2016. The third quarter of 2016 included the impact of an insurance recovery for breaches of representations and warranties related to warranty costs for certain product lines acquired from AirSep in 2012. For the three months ended September 30, 2016, this reduced BioMedical’s cost of sales by $15.1 million and added 28.3%2022. Similar to the margin. Excluding this impact,comments previously mentioned in the consolidated results section, the increase in Specialty Products sales was primarily driven by space applications, hydrogen and helium applications and other clean energy applications. The sales increase was partially offset by lower HLNG vehicle tank sales driven by higher natural gas prices and our customers’ availability of semiconductors due to macroeconomic conditions.
Specialty Products segment gross profit increased by $1.9$3.6 million and the related margin increased 2.8 percentage points primarily due to volume and favorable mix associated with military-based respiratory therapy applications.
BioMedical segment SG&A expenses during the thirdfirst quarter of 2017, decreased2023 as compared to the same quarter in 2016 primarily2022 largely due to lower employee-relatedhigher volume while gross profit margin decreased by 190 basis points due to HLNG carrying costs, associated with the operationsless beverage product mix, and engineering transition from our Buffalo BioMedical respiratory facilities to our Ball Ground, Georgia facilities along with the divestiturestrategic first of our Qdrive® business.a kind development and job budget.
Results for the Nine Months Ended September 30, 2017 and 2016
 Nine Months Ended Current Year-to-date vs.
Prior Year-to-date Period
 September 30, 2017 September 30, 2016 
Variance
 ($)
 
Variance
(%)
Sales$166,309
 $158,174
 $8,135
 5.1 %
Gross Profit60,426
 74,054
 (13,628) (18.4)%
Gross Profit Margin36.3% 46.8%    
SG&A Expenses$33,609
 $33,288
 $321
 1.0 %
SG&A Expenses (% of Sales)20.2% 21.0%    
Operating Income$24,387
 $38,120
 $(13,733) (36.0)%
Operating Margin14.7% 24.1%    
ForSpecialty Products segment SG&A expenses decreased by $7.0 million during the first nine monthsquarter of 2017, the increase in BioMedical segment sales2023 as compared to the same periodquarter in 2016 was2022 primarily driven military-based respiratory therapy equipment sales, stainless freezer sales within our life sciences applications, particularly in Asia,by lower employee-related costs.
Repair, Service & Leasing — Results of Operations for the Three Months Ended March 31, 2023 and an increase in projects within commercial oxygen generation systems applications.2022
During
Three Months EndedCurrent Quarter vs.
Prior Year Same Quarter
 March 31, 2023March 31, 2022Variance
($)		Variance
(%)
Sales$120.1 $49.3 $70.8 143.6 %
Gross Profit51.5 15.6 35.9 230.1 %
Gross Profit Margin42.9 %31.6 %
SG&A Expenses$10.1 $4.0 $6.1 152.5 %
SG&A Expenses (% of Sales)8.4 %8.1 %
Operating Income$33.8 $8.3 $25.5 307.2 %
Operating Margin28.1 %16.8 %
For the first nine monthsquarter of 2017, BioMedical2023, Repair, Service & Leasing segment gross profit and the related margin decreasedsales increased by $70.8 million or 143.6% (11.2% organically) as compared to the same periodquarter in 2016. The third2022. Similar to the comments previously mentioned in the consolidated results section, the increase was mainly driven by favorable sales in our lifecycle business, leasing business and aftermarket fans as well as Howden sales during our two-week ownership period.
During the first quarter of 2016 included the impact of an insurance recovery for breaches of representations and warranties related to warranty costs for certain product lines acquired from AirSep in 2012. For the nine months ended September 30, 2016, this reduced BioMedical’s cost of sales by $15.1 million and added 9.6% to the year-to-date margin. Excluding this impact,2023, Repair, Service & Leasing segment gross profit increased by $1.5$35.9 million mainly on increased volume.
BioMedical segment SG&A expenses, which included $2.0 million of restructuring costs during the first nine months of 2017, increased as compared to the same periodquarter in 2016 primarily2022, and gross profit margin increased by 1,130 basis points. The increase in gross profit and gross profit margin was driven by more short-lead time replacement equipment sales and field service work during the first quarter of 2023 as compared to the same quarter in 2022.
Repair, Service & Leasing segment SG&A expenses increased by $6.1 million during the first quarter of 2023, and SG&A expenses as a percentage of sales increased by 30 basis points mainly due to one-time costs related to expansion into a direct-to-consumer sales channel, regulatory, and legal fees. Higher restructuring costs were incurred during the nine months ended

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September 30, 2017 to support the operations and engineering transition from our Buffalo BioMedical respiratory facilities to our Ball Ground, Georgia facilities along with the divestiture of our Qdrive® business.higher employee-related costs.
Corporate
Corporate SG&A expenses increased by $10.0$33.6 million during the thirdfirst quarter of 20172023 as compared to the same quarter in 2016, primarily2022 mainly due to $7.4 million in acquisition-related costs, of which $7.3 million related to the Hudson acquisition. Corporate SG&A expenses increased by $15.1 million during the first nine months of 2017 as compared to the same period in 2016 primarily due to $8.6 million in acquisition-related costs, of which $8.1 million related to the Hudsonhigher acquisition and $4.6 million in corporate restructuring costs in the nine months ended September 30, 2017 compared to $1.1 million in the same period in 2016.employee-related costs.
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Liquidity and Capital Resources
Debt Instruments and Related Covenants
Convertible Notes: The outstanding aggregate principal amount of the Company’s Convertible Notes is $250.0 million. The Convertible Notes bear interest at a fixed rate of 2.0% per year, payable semiannuallyOur debt instruments and related covenants are described in arrears on February 1 and August 1 of each year, and will mature on August 1, 2018. The effective interest rate at issuance, under generally accepted accounting principles, was 7.9%. Upon conversion, holders of the Convertible Notes will receive cash up to the principal amount of the Convertible Notes. It is the Company’s intention to settle any excess conversion value in shares of the Company’s common stock. However, the Company may elect to settle, at its discretion, any such excess value in cash, shares of the Company’s common stock, or a combination of cash and shares. The initial conversion price of $69.03 per share represents a conversion premium of 30% over the last reported sale price of the Company’s common stock on July 28, 2011, the date of the Convertible Notes offering, which was $53.10 per share. The Convertible Notes are classified as current liabilities at September 30, 2017 as their maturity is within 12 months of the balance sheet date. At the end of the third quarter of 2017, events for early conversion were not met; and thus, the Convertible Notes were not convertible as of, and for the fiscal quarter beginning October 1, 2017. There have been no conversions as of the date of this filing. In the event that holders of Convertible Notes elect to convert, the Company expects to fund any cash settlement of any such conversion from cash balances or borrowings under its senior secured revolving credit facility.
Senior Secured Revolving Credit Facility: The Company has a five-year $450.0 million senior secured revolving credit facility (the “SSRCF”) which matures on October 29, 2019. The SSRCF includes a $25.0 million sub-limit for the issuance of swingline loans and a $100.0 million sub-limit to be used for letters of credit. There is a foreign currency limit of $100.0 million under the SSRCF which can be used for foreign currency denominated letters of credit and borrowings in a foreign currency, in each case in currencies agreed upon with the lenders. In addition, the facility permits borrowings up to $100.0 million made by the Company’s wholly-owned subsidiaries, Chart Industries Luxembourg S.à r.l. (“Chart Luxembourg”), and Chart Asia Investment Company Limited. The SSRCF also includes an expansion option permitting the Company to add up to an aggregate $200.0 million in term loans or revolving credit commitments from its lenders. Loans under the SSRCF bear interest at LIBOR or the Adjusted Base Rate as defined in the DebtNote 9, “Debt and Credit Arrangements noteArrangements” to our unaudited condensed consolidated financial statements included elsewhere in this report, plus a margin that varies with the Company’s leverage ratio. Significant financial covenants for the SSRCF include a minimum liquidity requirement equal to the principal amount of the Convertible Notes outstanding six months prior to the maturity date of the Convertible Notes and when holders of the Convertible Notes have the option to require the Company to repurchase the Convertible Notes, a leverage ratio and an interest ratio. On September 19, 2017, the Company entered into an amendment (“Amendment No. 2”) to its SSRCF to exclude the acquisition of Hudson from the pro forma leverage ratio requirement of the SSRCF. Concurrently with Amendment No. 2, the Company has exercised its right under the SSRCF to elect an increase in the maximum permissible leverage ratio thereunder to 3.75 for the four fiscal-quarter period ending September 30, 2018. As of September 30, 2017, there were $300.0 million borrowings outstanding under the SSRCF. The Company borrowed against this facility to fund the Hudson acquisition. The Company had $44.8 million in letters of credit and bank guarantees supported by the SSRCF, which had availability of $105.2 million, at September 30, 2017. The Company was in compliance with all covenants, including its financial covenants at September 30, 2017. The Company is currently negotiating a refinancing of the SSRCF, which is expected to close in November 2017. We anticipate that the refinanced SSRCF will extend the current SSRCF maturity to 2022 and otherwise be similar in size, structure and collateral packages to the current SSRCF, along with other changes favorable to the Company and its subsidiaries.
Foreign Facilities – China: Chart Cryogenic Engineering Systems (Changzhou) Company Limited (“CCESC”) and Chart Biomedical (Chengdu) Co. Ltd. (“Chengdu”), wholly-owned subsidiaries of the Company, and Chart Cryogenic Distribution Equipment (Changzhou) Company Limited (“CCDEC”), a joint venture of the Company, maintain joint banking facilities (the “China Facilities”) which include a revolving facility with 50.0 million Chinese yuan (equivalent to $7.5 million) in borrowing capacity which can be utilized for either revolving loans, bonds/guarantees, or bank draft acceptances. Any borrowings made by CCESC, CCDEC or Chengdu under the China Facilities are guaranteed by the Company. At September 30, 2017, there were no
borrowings under the revolving facility, but CCESC and CCDEC had 2.6 million Chinese yuan (equivalent to $0.4 million) and 0.5 million Chinese yuan (equivalent to $0.08 million) in bank guarantees, respectively.
CCDEC maintains an unsecured credit facility whereby CCDEC may borrow up to 30.0 million Chinese yuan (equivalent to $4.5 million) for working capital purposes. At September 30, 2017 there was 15.0 million Chinese yuan (equivalent to $2.3 million) outstanding under this facility, bearing interest at 4.35%. CCDEC was negotiating new terms of this facility including a new maturity date as of the end of the third quarter of 2017.
CCESC entered into a term loan during the second quarter of 2016. The term loan is secured by certain CCESC land use rights and allows for up to 86.6 million Chinese yuan (equivalent to $13.1 million) in borrowings. The loan has a term of eight years with semi-annual installment payments of at least 10.0 million Chinese yuan and a final maturity date of May 26, 2024. At September 30, 2017, there was 56.6 million Chinese yuan (equivalent to $8.5 million) outstanding on this loan, bearing interest at 5.39%.
Foreign Facilities – Europe: Chart Ferox, a.s. (“Ferox”), a wholly-owned subsidiary of the Company, maintains a secured credit facility with capacity of up to 125.0 million Czech koruna (equivalent to $5.7 million) and two secured credit facilities with capacity of up to 5.6 million euros (equivalent to $6.6 million). All three facilities allow Ferox to request bank guarantees and letters of credit. None of these facilities allow revolving credit borrowings. Under two of the facilities, Ferox must pay letter of credit and guarantee fees equal to 0.70% per annum on the face amount of each guarantee or letter of credit, and under one facility, Ferox must pay the letter of credit and guarantee fees equal to 0.50%. Ferox’s land, buildings and cash collateral secure the credit facilities. As of September 30, 2017, there were bank guarantees of 147.1 million Czech koruna (equivalent to $6.7 million) supported by the Ferox credit facilities.
Chart Luxembourg maintains an overdraft facility with $5.0 million in borrowing capacity. There were no borrowings under the Chart Luxembourg facility as of September 30, 2017.
Our debt and related covenants are further described in the Debt and Credit Arrangements note to our condensed consolidated financial statements included elsewhereItem 1, “Financial Statements” in this report.
Sources and UseUses of Cash
Our cash and cash equivalents totaled $124.7$169.4 million at September 30, 2017,March 31, 2023, a decrease of $157.3$2,435.9 million from the balance at December 31, 2016 primarily driven by the Hudson acquisition.2022. Our foreign subsidiaries held cash of approximately $83.3$135.1 million and $72.9$66.7 million, at September 30, 2017,March 31, 2023, and December 31, 2016,2022, respectively, to meet their liquidity needs. No material restrictions exist to accessing cash held by our foreign subsidiaries. We expect to meet our U.S. funding needs without repatriating non-U.S. cash and incurring incremental U.S. taxes.taxes, although we will opportunistically repatriate cash. Cash equivalents are primarily invested in money market funds that invest in high quality, short-term instruments, such as U.S. government obligations, certificates of deposit, repurchase obligations, and commercial paper issued by corporations that have been highly rated by at least one nationally recognized rating organization, and in the case of cash equivalents in China, obligations of local banks. We believe that our existing cash and cash equivalents, funds available under our SSRCF,senior secured revolving credit facility due October 2026 or other financing alternatives, and cash provided by operations will be sufficient to financemeet our normal working capital needs, acquisitions,capital expenditures and investments in properties, facilities, and equipment for the foreseeable future. We further anticipate repaying the Convertible Notes, which mature on August 1, 2018, on or before maturity with some combination of cash and liquid investments, availability under the SSRCF or additional financing sources.
Cash provided byused in operating activities was $17.5$32.1 million for the ninethree months ended September 30, 2017, a decreaseMarch 31, 2023, an increase of $129.1$9.9 million fromcompared to cash used in operating activities of $22.2 million for the ninethree months ended September 30, 2016,March 31, 2022 primarily due to lower net income anda decrease in operating cash provided by working capital increases within accounts receivable and inventory. Cash provideddriven by operating activities was $146.6$71.5 million cash paid to settle the stainless steel cryobiological tank legal proceedings, a higher bonus payout for our employees compared to the ninethree months ended September 30, 2016 largely due to improvements in working capital, including greater cash collections duringMarch 31, 2022 and payout of Howden’s long term incentive plan at the first halftime of 2016, and reductions in inventory,acquisition, partially offset by reduced accounts payable.cash generated from operations during the three months ended March 31, 2023.
Cash used in investing activities was $468.1$4,373.8 million and $13.7$17.5 million for the ninethree months ended September 30, 2017March 31, 2023 and 2016,2022, respectively. During the ninethree months ended September 30, 2017,March 31, 2023, we used $419.4approximately $4,339.8 million of cashfor the Howden Acquisition. During the three months ended March 31, 2022, we used approximately $3.9 million mainly for investments in the Clean H2 Infra Fund, Gold Hydrogen LLC and a joint venture in AdEdge India. During the three months ended March 31, 2022 we paid $0.8 million in working capital settlements related to our 2021 acquisition of AdEdge. During the Hudson acquisition, $23.2 million of cash related to the Hetsco acquisition, $3.4 million cash related to the VCT acquisition and $23.4three months ended March 31, 2023, we paid approximately $31.4 million for capital expenditures. Duringexpenditures including a $11.3 million land purchase for our Theodore facility expansion as compared to $12.6 million for the ninethree months ended September 30, 2016, we used $13.4 million for capital expenditures.March 31, 2022.
Cash provided by financing activities was $296.2$1,967.8 million and $8.8$15.9 million for the ninethree months ended September 30, 2017March 31, 2023 and 2016,2022, respectively. During the ninethree months ended September 30, 2017,March 31, 2023, we borrowed $300.0$634.8 million on our SSRCFrevolving credit facility and $1,497.2 million on our term loan primarily to fund the Hudson acquisition. We also borrowed 15.0 million Chinese yuan (equivalent to $2.2 million)Howden Acquisition and repaid 35.0$45.0 million Chinese yuan (equivalent to $5.1 million)in borrowings on our China Facilities. We received $1.1revolving credit facility. During the three months ended March 31, 2023 we paid $121.5 million in proceeds fromdebt issuance costs and paid $6.9 million of dividends on our mandatory convertible preferred stock, option exercises and used $2.0 million for the purchaseneither of common stock which was surrendered to cover tax withholding electionsoccurred during the ninethree months ended September 30, 2017.March 31, 2022. During the ninethree months ended September 30, 2016,March 31, 2022, we borrowed 111.6$254.0 million Chinese yuan (equivalent to $17.0 million)on credit facilities and repaid 50.0$235.9 million Chinese yuan (equivalentin borrowings on credit facilities primarily driven by debt positioning related to $7.6 million) on our China Facilities.

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Accounts Receivablethe rate swap agreements mentioned in Note 9, “Debt and Allowance for Doubtful Accounts
Our accounts receivable, net, balance was $195.8 million at September 30, 2017 compared to $142.8 million at December 31, 2016, representing an increase of $53.0 million. The Hudson acquisition added $34.7 million to our accounts receivable balance at September 30, 2017. Our accounts receivable allowance was $10.3 million at September 30, 2017 and $10.2 million at December 31, 2016. The reserve includes approximately $7.2 million attributed to receivables in China in light of the economic environment and collection challenges in China.Credit Arrangements.”
Cash Requirements
We do not currently anticipate any unusual cash requirements for working capital needs for the year ending December 31, 2017.2023. Management anticipates we will be able to satisfy cash requirements for our ongoing business for the foreseeable future with cash generated by operations, existing cash balances and available borrowings under our credit facilities. We may repurchase a portion of our Convertible Notes on the open market from time to time to the extent permitted by our debt covenants with available cash. To the extent that we repurchase Convertible Notes, we would expect to enter into an agreement with each of the Option Counterparties to our convertible note hedge, warrants, and capped call agreements providing for the partial unwind of such agreements in a notional amount corresponding to the aggregate principal amount of Convertible Notes that we repurchase. We expect to satisfy the minimum liquidity requirement under our SSRCF during the six months prior to the August 1, 2018 maturity of the Convertible Notes as well as the ultimate payment of the Convertible Notes with some combination of cash and liquid investments, availability under the SSRCF or additional financing sources. We expect capitalCapital expenditures for the remaining threenine months of 20172023 is expected to be $12.0in the range of $60.0 million to $22.0 million, which will be deployed primarily for an expansion of the brazed aluminum heat exchanger facility in La Crosse, Wisconsin, as well as cost saving improvement projects and routine maintenance across all businesses. For the remaining three months of 2017, we contemplate the use of approximately $8.0 million to $9.0 million of cash to pay U.S. and foreign income taxes.$65.0 million.
Orders and Backlog
We consider orders to be those for which we have received a firm signed purchase order or other written contractual commitmentcommitments from the customer. Backlog is comprised of the portion of firm signed purchase orders or other written contractual commitments received from customers for which work has not been performed, or is partially completed, that we have not recognized as revenue upon shipment or under the percentage of completion method. Backlog can be significantly affected by the timing of orders for large projects, particularly in the E&C segment, and is not necessarily indicative of future backlog levels or the rate at which backlog will be recognized as sales. Orders included in our backlog may include customary cancellation provisions under which the customer could cancel part or all of the order, potentially subject to the payment of certain costs and/or fees. Backlog may be negatively impacted by ability or likelihood of customers to fulfill their obligations.excludes unexercised contract options and potential orders. Our backlog as of September 30, 2017March 31, 2023 was $480.7$3,932.0 million, compared to $384.4$1,477.0 million as of September 30, 2016March 31, 2022 and $367.2$2,338.1 million as of June 30, 2017. The Hudson acquisition added $90.2 million to our backlog at September 30, 2017.December 31, 2022.
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The tabletables below representsrepresent orders received and backlog by segment for the periods indicated (dollar amounts(dollars in thousands)millions):
 Three Months Ended
 March 31,
2023		March 31,
2022		December 31,
2022
Orders
Cryo Tank Solutions$145.3 $142.4 $139.7 
Heat Transfer Systems311.3 354.1 235.8 
Specialty Products179.5 100.5 96.4 
Repair, Service & Leasing123.7 43.4 66.3 
Intersegment eliminations(12.1)(3.6)(12.3)
Consolidated$747.7 $636.8 $525.9 
 Three Months Ended
 September 30,
2017		 September 30,
2016		 June 30,
2017
Orders     
Energy & Chemicals$65,939
 $27,889
 $64,630
Distribution & Storage134,145
 121,010
 134,037
BioMedical57,870
 52,347
 53,924
Total$257,954
 $201,246
 $252,591
As of
March 31,
2023		March 31,
2022		December 31,
2022
Backlog
Cryo Tank Solutions$531.3 $365.8 $371.0 
Heat Transfer Systems1,590.1 639.5 1,300.1 
Specialty Products1,316.2 418.8 645.9 
Repair, Service & Leasing539.7 53.6 57.0 
Intersegment eliminations(45.3)(0.7)(35.9)
Consolidated$3,932.0 $1,477.0 $2,338.1 
 As of
 September 30,
2017		 September 30,
2016		 June 30,
2017
Backlog     
Energy & Chemicals$234,605
 $113,482
 $122,749
Distribution & Storage222,966
 246,197
 224,993
BioMedical23,171
 24,751
 19,434
Total$480,742
 $384,430
 $367,176
E&CCryo Tank Solutions segment orders for the three months ended September 30, 2017March 31, 2023 were $65.9$145.3 million compared to $27.9$142.4 million for the three months ended September 30, 2016March 31, 2022 and $64.6$139.7 million for the three months ended June 30, 2017. Low energy prices continue to

36

delay LNG-related opportunities. However, natural gas demand, from Petrochemical and LNG export projects, is driving new gas transmission pipelines creating further opportunity for Chart’s products. E&C backlog totaled $234.6 million as of September 30, 2017, compared to $113.5 million as of September 30, 2016 and $122.7 million as of June 30, 2017.December 31, 2022. The increase in backlog as compared to the balance as of September 30, 2016 was primarily driven by petrochemical and natural gas processing applications and inclusion of Hudson’s backlog which added $90.2 million to our backlog as of September 30, 2017. Order flow in the E&CCryo Tank Solutions segment is historically volatile due to project size and it is not unusual to see order intake change significantly year over year. Included in the E&C backlog is approximately $40 million related to the previously announced Magnolia LNG order where production release is delayed into at least late-2018.
D&S orders forduring the three months ended September 30, 2017 were $134.1 million compared to $121.0 million for the three months ended September 30, 2016 and $134.0 million for the three months ended June 30, 2017. The slight increase in D&S orders from the second quarter of 2017 was primarily attributable to a $10.4 million increase in bulk industrial gas products, partially offset by a $5.2 million decrease in LNG applications and a $5.0 million decrease in packaged gas industrial applications. The increase in D&S orders during the third quarter of 2017March 31, 2023 when compared to the same quarter last year and prior quarter was mainly attributable to U.S.primarily driven by higher order intake for mobile equipment and Asia bulk industrial gas applications. D&Sstorage equipment. Cryo Tank Solutions segment backlog at March 31, 2023 totaled $223.0$531.3 million at September 30, 2017 compared to $246.2$365.8 million as of September 30, 2016March 31, 2022 and $225.0$371.0 million as of June 30, 2017.December 31, 2022.
BioMedicalHeat Transfer Systems segment orders for the three months ended September 30, 2017March 31, 2023 were $57.9$311.3 million compared to $52.3$354.1 million for the three months ended September 30, 2016March 31, 2022 and $53.9$235.8 million for the three months ended June 30, 2017. December 31, 2022.The increase from the second quarter of 2017decrease in BioMedical orders was mainly attributabledriven by lower order intake for big LNG during the three months ended March 31, 2023 as compared to the additionthree months ended March 31, 2022. Heat Transfer Systems segment backlog at March 31, 2023 totaleda record $1,590.1 million, up 148.6% over the first quarter of projects within commercial oxygen generations systems applications2022 and an increase inup 22.3% over the fourth quarter of 2022 driven by multiple small, mid-size and large projects.
Specialty Products segment orders within respiratory therapy applications, especially in Europefor the three months ended March 31, 2023 were $179.5 million compared to $100.5 million for the three months ended March 31, 2022 and North America.$96.4 million for the three months ended December 31, 2022. The increase in BioMedicalSpecialty Products segment orders during the three months ended September 30, 2017 whenMarch 31, 2023 was mainly due to a larger clean energy order. Specialty Products segment backlog totaled a record $1,316.2 million as of March 31, 2023, compared to $418.8 million as of March 31, 2022 and $645.9 million as of December 31, 2022.
Repair, Service & Leasing segment orders for the same quarter last year was mainly attributable to the addition of projects within commercial oxygen generations systems applications. BioMedical backlog at September 30, 2017 totaled $23.2three months ended March 31, 2023 were $123.7 million compared to $24.8$43.4 million for the three months ended March 31, 2022 and $66.3 million for the three months ended December 31, 2022. The increase in orders was mainly driven by strong order intake for fans aftermarket and parts, repairs, and services. Repair, Service & Leasing segment backlog totaled a record $539.7 million as of September 30, 2016 and $19.4March 31, 2023, compared to $53.6 million as of June 30, 2017.March 31, 2022 and $57.0 million as of December 31, 2022.
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Off-Balance Sheet Arrangements
We do not have any material off-balance sheet arrangements.
Application of Critical Accounting Policies
The Company’sOur unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles. As such, some accounting policies have a significant impact on amounts reported in these unaudited condensed consolidated financial statements. A summary of those significant accounting policies can be found in the Company’sour Annual Report on Form 10-K for the year ended December 31, 2016.2022. In particular, judgment is used in areas such as revenue recognition for long-termfrom contracts with customers, goodwill, indefinite-lived intangibles, long-lived assets (including finite-lived intangible assets), product warranty costs, and pensions. There have been no significant changes to our critical accounting policies since December 31, 2016.2022.
Forward-Looking Statements
The Company isWe are making this statement in order to satisfy the “safe harbor” provisions contained in the Private Securities Litigation Reform Act of 1995. This Quarterly Report on Form 10-Q includes “forward-looking statements.” These forward-looking statements include statements relating to our business.business, including statements regarding completed and pending acquisitions and investments and related accretion or statements with respect to the use of proceeds or redeployment of capital from recent or planned divestitures, as well as statements regarding revenues, cost synergies and efficiency savings, objectives, future orders, margins, segment sales mix, earnings or performance, liquidity and cash flow, inventory levels, capital expenditures, supply chain challenges, inflationary pressures including materials costs and pricing increases, business trends, clean energy market opportunities including addressable market and projected industry-wide investments, carbon and GHG emission targets, governmental initiatives, including executive orders and other information that is not historical in nature. In some cases, forward-looking statements may be identified by terminology such as “may,” “will”, “should,” “expects,” “anticipates,” “believes,” “projects,” “forecasts,” “continue,“outlook,” “guidance,” “target,” “continue” or the negative of such terms or comparable terminology. Forward-looking statements contained herein (including future cash contractual obligations, liquidity, cash flow, orders, results of operations, projected revenues, margins, capital expenditures, industry and business, trends, clean energy and other new market or expansion opportunities, cost synergies and savings objectives, and government initiatives among other matters) or in other statements made by us are made based on management’s expectations and beliefs concerning future events impacting us and are subject to uncertainties and factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control, that could cause our actual results to differ materially from those matters expressed or implied by forward-looking statements. We believe that
These include: the followingother factors among others (including those described underdiscussed in Item 1A. “Risk Factors” and the factors discussed in Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2016), could affect our future performance2022, which should be reviewed carefully; risks relating to the conflict between Russia and the liquidityUkraine; risks relating to derivative instruments and value of our securities and cause our actual results to differ materially from those expressed or implied by forward-looking statements made by us or on our behalf:
•the cyclicality of the markets which we serve and the vulnerability of those markets to economic downturns;
the loss of, or a significant reduction or delay in purchases by, our largest customers;
our ability to control our costs and successfully manage our operations;
fluctuations in energy prices;
competition in our markets;
the potential for negative developments in the natural gas industry related to hydraulic fracturing;

37

the impairment of our goodwill or other intangible assets;
degradation of our backlog as a result of modification or termination of orders;
ourhedging programs; Chart’s ability to successfully acquire or integrate companies, such asrecent acquisitions, and achieve the recent acquisition of Hudson, that provide complementary products or technologies;
governmental energy policies could change, or expected changes could fail to materialize;
our ability to manage our fixed-price contract exposure;
economic downturnsanticipated revenue, earnings, accretion and deteriorating financial conditions;
our reliance on the availability of key supplies and services;
changes in government health care regulations and reimbursement policies;
litigation and disputes involving us, including the extent of product liability, warranty, contract, employment, intellectual property and environmental claims asserted against us;
fluctuations in foreign currency exchange rates and interest rates;
the loss of key employees;
general economic, political, businessother benefits from these acquisitions; slower than anticipated growth and market risks associated with our global operations,acceptance of new clean energy product offerings; inability to achieve expected pricing increases or continued supply chain challenges including collection issues related to receivablesvolatility in China;
our warranty reservesraw materials cost and supply; estimated segment revenues, future revenue, earnings, cash flows and margin targets and run rates. These factors should not be construed as exhaustive and there may not adequately cover our warranty obligations;
technological security threats and our reliance on information systems;
financial distress of third parties;
our ability to protect our intellectual property and know-how;
United States Food and Drug Administration and comparable foreign regulation of our products;
the pricing and availability of raw materials;
claims that our products or processes infringe intellectual property rights of others;
the cost of compliance with environmental, health, and safety laws and responding to potential liabilities under these laws;
additional liabilities related to taxes;
our ability to continue our technical innovation in our product lines;
the underfunded status of our pension plan;
the risk of potential violations of the Foreign Corrupt Practices Act;
increased government regulation;
labor costs and disputes and the deterioration of our relations with our employees;
disruptions in our operations due to severe weather;
regulations governing the export of our products and other regulations applicable to us as a supplier of products to the U.S. government;
fluctuations or adjustments in the Company’s effective tax rate;
risks associated with our indebtedness, leverage and liquidity;
fluctuations in the price of our stock;
potential dilution to existing holders of our common stock as a result of the conversion of our Convertible Notes, and the need to utilize our cash balances and/or credit facility to fund any cash settlement related to such conversions; and
other factors described herein.
There mayalso be other factorsrisks that may cause our actual resultswe are unable to differ materially from the forward-looking statements.predict at this time.
All forward-looking statements attributable to us or persons acting on our behalf apply only as of the date of this Quarterly Report and are expressly qualified in their entirety by the cautionary statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2016,2022, as the same may be updated from time to time. We undertake no obligation to update or revise forward-looking statements which may be made to reflect events or circumstances that arise after the filing date of this document or to reflect the occurrence of unanticipated events.events, except as otherwise required by law.

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Item 3.Quantitative and Qualitative Disclosures About Market Risk
Item 3.Quantitative and Qualitative Disclosures About Market Risk
In the normal course of business, the Company’sour operations are exposed to fluctuations in interest rates and foreign currency values that can affect the cost of operating and financing. Accordingly, the Company addresseswe address a portion of these risks through a program of risk management.
Interest Rate Risk: The Company’sOur primary interest rate risk exposure results from the SSRCF’s various floating rate pricing mechanisms.mechanisms contained in our senior secured revolving credit facility due October 2026 and from our term loan. If interest rates were to increase 200100 basis points (2(1 percent) from the weighted-average interest rate for our senior secured revolving credit facility due 2026 of 4.00%5.0% at September 30, 2017,March 31, 2023, and assuming no changes in the $300.0$697.2 million of borrowings outstanding under the SSRCFsenior secured revolving credit facility due October 2026 at September 30, 2017,March 31, 2023, our additional annual expense would be approximately $6.0$7.0 million on a pre-tax basis. If interest rates were to increase 100 basis points (1 percent) from the interest rate for our term loan of 8.60% at March 31, 2023, and assuming no changes in the $1,534.8 million of borrowings outstanding under the term loan at March 31, 2023, our additional annual expense would be approximately $15.3 million on a pre-tax basis.
55
Foreign Currency Exchange Rate Risk:The Company operates We operate in the United States Asia, Australia, Europe, Mexico and South America, creatingother foreign countries, which creates exposure to foreign currency exchange fluctuations in the normal course of business, which can impact our financial position, results of operations, cash flow, and competitive position. The financial statements of foreign subsidiaries are translated into their U.S. dollar equivalents at end-of-period exchange rates for assets and liabilities, while income and expenses are translated at average monthly exchange rates. Translation gains and losses are components of other comprehensive (loss) income as reported in the unaudited condensed consolidated statements of operations and comprehensive (loss) income. Translation exposure is primarily with the euro, the Czech koruna, the Chinese yuan and the Japanese yen.Indian rupee. During the thirdfirst quarter of 2017,2023, the euro and Chinese yuan strengthenedU.S. dollar weakened in relation to the U.S. dollareuro by 3%2%, the Chinese yuan by 1% and 2%, respectively, while the Japanese yen remained relatively unchanged versus the U.S. dollar.Czech koruna by 4%. At September 30, 2017,March 31, 2023, a hypothetical further 10% weakeningstrengthening of the U.S. dollar would not materially affect the Company’sour financial statements.
EUR Revolver Borrowings: Additionally, assuming no changes in the euro $94.0 million in EUR Revolver Borrowings outstanding under the senior secured revolving credit facility due October 2026 and an additional 100 basis points (1 percent) strengthening in the U.S dollar in relation to the euro as of the beginning of 2023, during the three months ended March 31, 2023, our additional unrealized foreign currency gain would be approximately $1.0 million on a pre-tax basis.
Transaction Gains and Losses:Chart’s primary transaction exchange rate exposures are with the euro, the Japanese yen,Chinese yuan, the Czech koruna, the Indian rupee, the Australian dollar, the British pound, the Canadian dollar, the Japanese yen and the Chinese yuan.South African rand. Transaction gains and losses arising from fluctuations in currency exchange rates on transactions denominated in currencies other than the functional currency are recognized in the unaudited condensed consolidated statements of operations and comprehensive (loss) income as a component of foreign currency (gain) loss. The Company enters
Derivative Instruments: We enter into foreign exchange forwardcurrency contracts not designated as hedging instruments to hedgemitigate foreign currency risk for anticipated and firmly committed foreign currency transactions. Chart doesAt March 31, 2023, a hypothetical 10% weakening of the U.S. dollar would not materially affect these outstanding foreign currency contracts. We enter into a combination of cross-currency swaps and foreign exchange collars as a net investment hedge of our investments in certain international subsidiaries that use the euro as their functional currency in order to reduce the volatility caused by changes in exchange rates. As disclosed in Note 9, “Debt and Credit Arrangements,” we purchased an out-of-the-money protective call while writing a put option with a strike price at which the premium received is equal to the premium of the protective call purchased, which involved no initial capital outlay. The call was structured with a strike price higher than our cost basis in such investments, thereby limiting any foreign exchange losses to approximately $11.4 million on a pre-tax basis. We do not use derivative financial instruments for speculative or trading purposes. The terms of the contracts are generally one year or less. At September 30, 2017, a hypothetical 10% weakening of the U.S. dollar would not materially affect the Company’s outstanding foreign exchange forward contracts.to three years.
Market Price Sensitive Instruments
In connection with the issuancepricing of the 1.00% Convertible Senior Subordinated Notes the Companydue November 2024 (the “2024 Notes”), we entered into privately-negotiated convertible note hedge and capped call transactions (the “Note Hedge Transactions”) with certain parties, including affiliates of certainthe initial purchasers of the underwriters2024 Notes (the “Option Counterparties”). The convertible note hedge and capped call transactions relate to, collectively, 3.6 million shares, which represents the number of shares of the Company’s common stock underlying the Convertible Notes, subject to anti-dilution adjustments substantially similar to those applicable to the Convertible Notes. These convertible note hedge and capped call transactionsNote Hedge Transactions are expected to reduce the potential dilution with respect to the Company’s common stock upon any future conversion of the Convertible Notes and/or reduce the Company’s exposure to potential cash or stock payments that may be required upon conversion of the Convertible Notes, except, in the case of the capped call transactions, to the extent that the market price per share of the Company’s common stock exceeds the cap price of the capped call transactions.2024 Notes.
The CompanyWe also entered into separate, privately-negotiated warrant transactions with the Option Counterparties initially relating to the number ofacquire up to 4.41 million shares of the Company’sour common stock underlying the convertible note hedge transactions, subject to customary anti-dilution adjustments.stock. The warrant transactions will have a dilutive effect with respect to the Company’sour common stock to the extent that the price per share of the Company’sour common stock exceeds the strike price of the warrants unless the Company elects,we elect, subject to certain conditions, to settle the warrants in cash. The cap price of the capped call transactions and the strike price of the warrant transactions related to the 2024 Notes was initially $84.96$71.775 per share. Further information is located in the DebtNote 9, “Debt and Credit Arrangements noteArrangements” to the Company’sour unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.
Item 4.Controls and Procedures
Item 4.Controls and Procedures
Evaluation of Disclosure Controls and Procedures
As of September 30, 2017,We performed an evaluation, was performed, under the supervision and with the participation of the Company’sour management, including the Company’sour Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’sour disclosure controls and procedures pursuant to Rule 13a-15 under the Securities and Exchange Act of 1934, as amended (the “Exchange Act”). as of March 31, 2023. Based upon that evaluation, such officersour Chief Executive Officer and Chief Financial Officer have concluded that the Company’sas of March 31, 2023, our disclosure controls and procedures arewere effective to ensure that information required to be disclosed by the Companyus in the reports it fileswe file or submitssubmit under the Exchange Act (1) is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and (2) is accumulated and communicated to the Company’sour management

39

including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow for timely decisions regarding required disclosure.
56
Changes in Internal Control Over Financial Reporting
There were no changes in the Company’sour internal control over financial reporting that occurred during the Company’sour most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Company’sour internal control over financial reporting except that on September 20, 2017 the Company acquired RCHPH Holdings, Inc. (“Hudson”). As a result, the Company is currently integrating Hudson’s operations into its overall system of internal control over financial reporting. Under the guidelines established by the Securities and Exchange Commission, companies are permitted to exclude acquisitions from their assessment of internal control over financial reporting during the first year of acquisition. Accordingly, we expect to exclude Hudson from the assessment of internal control over financial reporting for 2017.

40
57


PART II. OTHER INFORMATION
Item 1. Legal Proceedings
As disclosed in Note 18, “Commitments and Contingencies,” Chart was named in lawsuits (including lawsuits filed in the U.S. District Court for the Northern District of California) filed against Chart and other defendants with respect to the alleged failure of a stainless steel cryobiological storage tank (model MVE 808AF-GB) at the Pacific Fertility Center in San Francisco, California. We hereby incorporate by reference into this Item 1 the disclosure under the headings “Note 18, Commitments and Contingencies – Stainless Steel Cryobiological Tank Legal Proceedings.”
We are occasionally subject to various other legal claims related to performance under contracts, product liability, taxes, employment matters, environmental matters, intellectual property, and other matters incidental to the normal course of our business. Based on our historical experience in litigating these claims, as well as our current assessment of the underlying merits of the claims and applicable insurance, if any, management believes that the final resolution of these matters will not have a material adverse effect on our financial position, liquidity, cash flows, or results of operations. Future developments may, however, result in resolution of these legal claims in a way that could have a material adverse effect.
Item 1A.Risk Factors
Item 1A. Risk Factors
In addition to the other information set forth in this report, you should carefully consider the risk factors disclosed in Item 1A. “Risk Factors,” of the Company’sour Annual Report on Form 10-K for the fiscal year ended December 31, 2016.2022.
Item 2.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
 Issuer Purchases of Equity Securities
PeriodTotal
Number
of
Shares
Purchased		 Average Price
Paid Per
Share		 Total Number of
Shares Purchased
As Part of Publicly
Announced Plans
or Programs		 Approximate Dollar
Value of Shares
that May Yet Be
Purchased Under
the Plans or
Programs
July 1 – 31, 2017478
 $37.11
 —
 $—
August 1 – 31, 20172,125
 33.73
 —
 —
September 1 – 30, 2017252
 35.54
 —
 —
Total2,855
 $34.46
 —
 $—
Issuer Purchases of Equity Securities
Period
Total
Number
of
Shares
Purchased (1)
Average Price
Paid Per
Share (1)
Total Number of
Shares Purchased
As Part of Publicly
Announced Plans
or Programs		Approximate Dollar
Value of Shares
that May Yet Be
Purchased Under
the Plans or
Programs
January 1 - 31, 202312,817 $117.01 — $— 
February 1 – 28, 20239,665 134.18 — — 
March 1 – 31, 2023122 116.50 — — 
Total22,604 124.35 — $— 
During the third quarter of 2017, 2,855_______________
(1)Includes shares of common stock were surrendered to us during the first quarter of 2023 by participants under our share-based compensation plans to satisfy tax withholding obligations relating to the vesting or payment of equity awards for an aggregate purchase price of approximately $98,371.$2,810,764. The total number of shares repurchased represents the net shares issued to satisfy tax withholdings. All such repurchased shares were subsequently retired during the three months ended September 30, 2017.March 31, 2023.
Item 4. Mine Safety Disclosures
Not applicable.

Item 5. Other Information
On April 28, 2023, we furnished a Form 8-K that incorporated by reference an earnings release announcing our results of operations for the three months ended March 31, 2023. We subsequently determined the following changes were required:
Condensed Consolidated Balance Sheet at March 31, 2023:
•We reclassified $20.4 million from other current assets to goodwill related to the Howden preliminary estimated opening balance sheet, and
•$48.6 million from accounts payable to other current assets.
Condensed Consolidated Statement of Cash Flows for the Three Months Ended March 31, 2023:
•We reclassified $55.6 million from operating activities to payments for debt issuance costs within financing activities, which related to bridge loan fees, and
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58

•$33.5 million previously netted with borrowings on term loan within financing activities to payments for debt issuance costs within financing activities.
These changes had a net $0 impact on our condensed consolidated statements of operations and comprehensive (loss) income for the three months ended March 31, 2023.
Item 6.Exhibits
Item 6.Exhibits
The following exhibits are included with this report:
2.1
Amendment No. 1, dated September 19, 2017, to Agreement and Plan of Merger, among Chart Industries, Inc., Chart Sully Corporation, RCHPH Holdings, Inc., and R/C Hudson Holdings, L.P., solely in its capacity as the Initial Holder Representative under the Merger Agreement, dated as of June 30, 2017 (incorporated by reference to Exhibit 2.2 to the Registrant’s Current Report on Form 8-k filed with the SEC on September 21, 2017
31.1    Rule 13a-14(a) Certification of the Company’s Chief Executive Officer and President (Principal Executive Officer). (x)
31.2    Rule 13a-14(a) Certification of the Company's Vice President and Chief Financial Officer (Principal Financial Officer). (x)
32.1    Section 1350 Certification of the Company’s Chief Executive Officer and President (Principal Executive Officer). (xx)
32.2    Section 1350 Certification of the Company's Vice President and Chief Financial Officer (Principal Financial Officer). (xx)
10.1    Amendment No. 2, dated as of March 16, 2023, to the Credit Agreement, dated as of October 18, 2021, by and among Chart Industries, Inc., the subsidiaries of Chart Industries, Inc. designated as borrowers from time to time thereunder, the lenders named therein, JPMorgan Chase Bank, N.A., as Administrative Agent, Bank of America, N.A., Fifth Third Bank, National Association, HSBC Bank USA, National Association, PNC Bank, National Association and Wells Fargo Bank, National Association, as Co-Syndication Agents, and BMO Harris Bank, N.A., Capital One, N.A., Citizens Bank, N.A., MUFG Union Bank, N.A. and Regions Bank, as Co-Documentation Agents (incorporated by reference to Exhibit 10.1 of the Registrant’s Current Report on Form 8-K, filed with the SEC on March 17, 2023 (File No. 001-11442)).
10.2    Amendment No. 3, dated as of March 17, 2023, to the Credit Agreement, dated as of October 18, 2021, by and among Chart Industries, Inc., the subsidiaries of Chart Industries, Inc. designated as borrowers from time to time thereunder, the lenders named therein, JPMorgan Chase Bank, N.A., as Administrative Agent, Bank of America, N.A., Fifth Third Bank, National Association, HSBC Bank USA, National Association, PNC Bank, National Association and Wells Fargo Bank, National Association, as Co-Syndication Agents, and BMO Harris Bank, N.A., Capital One, N.A., Citizens Bank, N.A., MUFG Union Bank, N.A. and Regions Bank, as Co-Documentation Agents (incorporated by reference to Exhibit 10.2 of the Registrant’s Current Report on Form 8-K, filed with the SEC on March 17, 2023 (File No. 001-11442)).
101.INS    XBRL Instance Document *
101.SCH    XBRL Taxonomy Extension Schema Document
101.CAL    XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF    XBRL Taxonomy Extension Definition Linkbase Document
101.LAB    XBRL Taxonomy Extension Label Linkbase Document
101.PRE    XBRL Taxonomy Extension Presentation Linkbase Document
10.1
Amendment No. 2 to Employment Agreement, dated September 8, 2017, between the Company and Mary C. Cook (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on September 8, 2017 (File No. 001-11442)).*
10.2
Amendment No. 2, dated September 19, 2017, to the Second Amended and Restated Credit Agreement, dated October 29, 2014, among Chart Industries, Inc., Chart Industries Luxembourg S.à r.l., Chart Asia Investment Company, the lenders from time to time party thereto, and JPMorgan Chase Bank, N.A. as Administrative Agent (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on September 21, 2017 (File No. 001-11442)).
31.1
Rule 13a-14(a) Certification of Chief Executive Officer. (x)
31.2
Rule 13a-14(a) Certification of Chief Financial Officer. (x)
32.1
Section 1350 Certification of Chief Executive Officer. (xx)
32.2
Section 1350 Certification of Chief Financial Officer. (xx)
101.INSXBRL Instance Document (x)
101.SCHXBRL Taxonomy Extension Schema Document (x)
101.CALXBRL Taxonomy Extension Calculation Linkbase Document (x)
101.DEFXBRL Taxonomy Extension Definition Linkbase Document (x)
101.LABXBRL Taxonomy Extension Label Linkbase Document (x)
101.PREXBRL Taxonomy Extension Presentation Linkbase Document (x)
_______________
(x)
(x)    Filed herewith.
(xx)Furnished herewith.
*Management contract or compensatory plan or arrangement.


(xx)     Furnished herewith.

*    The Instance Document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
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59


SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
 
Chart Industries, Inc.
(Registrant)
 
Date:May 9, 2023By:/s/ Jillian C. Evanko
Jillian C. Evanko
Chief Executive Officer, President and a Director
(Principal Executive Officer)
Date:October 26, 2017May 9, 2023By:/s/ Jillian C. EvankoJoseph R. Brinkman
Jillian C. EvankoJoseph R. Brinkman
Vice President and Chief Financial Officer Chief Accounting Officer and Treasurer
(Principal Financial Officer)
(Duly Authorized Officer)


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