Taking a long-term approach to certain insurance documentation

After insurance policies expire, many businesses just throw away the paper copies and delete the digital files. But you may need to produce evidence of certain kinds of insurance even after the coverage period has expired. For this reason, it’s best to take a long-term approach to certain types of policies.

Occurrence-based insurance

Generally, the policy types in question are called “occurrence-based.” They include:

• General liability,
• Umbrella liability,
• Commercial auto, and
• Commercial crime and theft.

You should retain documentation of occurrence-based policies permanently (or as long as your business is operating). A good example of why is in cases of embezzlement. Employee fraud of this kind may be covered under a commercial crime and theft policy. However, embezzlement sometimes isn’t uncovered until years after the crime has taken place.

For instance, suppose that, during an audit, you learn an employee was embezzling funds three years ago. But the policy that covered this type of theft has since expired. To receive an insurance payout, you’d need to produce the policy documents to prove that coverage was in effect when the crime occurred.

Retaining insurance documentation long-term isn’t necessary for every type of policy. Under “claims-made” insurance, such as directors and officers liability and professional liability, claims can be made against the insured business only during the policy period and during a “tail period” following the policy’s expiration. A commonly used retention period for claims-made policies is about six years after the tail period expires.

Additional protection

Along with permanently retaining proof of occurrence-based policies, it’s a good idea to at least consider employment practices liability insurance (EPLI). These policies protect businesses from employee claims of legal rights violations at the hands of their employers. Sexual harassment is one type of violation that’s covered under most EPLI policies — and such claims can arise years after the alleged crime occurred.

As is the case with occurrence-based coverage, if an employee complaint of sexual harassment arises after an EPLI policy has expired — but the alleged incident occurred while coverage was in effect — you may have to produce proof of coverage to receive a payout. So, you should retain EPLI documentation permanently as well.

Better safe than sorry

You can’t necessarily rely on your insurer to retain expired policies or readily locate them. It’s better to be safe than sorry by keeping some insurance policies in either paper or digital format for the long term. This is the best way to ensure that you’ll receive insurance payouts for events that happened while coverage was still in effect. Our firm can help you assess the proper retention periods of your insurance policies, as well as whether they’re providing optimal value for your company.

© 2019

High Risk of Emergency After First Boeing MAX Crash

By

Andrew Tangel and 

Andy Pasztor

July 31, 2019 5:32 am ET

An internal risk analysis after the first of two Boeing 737 MAX airliner crashes showed the likelihood was high of a similar cockpit emergency within months, according to a Federal Aviation Administration official familiar with the details and others briefed on the matter.

The regulator’s analysis, not previously reported, showed that it “didn’t take that much” for a malfunction like the one confronted by the pilots of the Lion Air flight that crashed into the Java Sea last year to occur, one of the people briefed on the analysis said.

Based on the findings, the regulator decided it was sufficient to inform pilots about the hazards of an onboard sensor malfunction that led to a flight-control system pushing down the plane’s nose. The belief was that if pilots were aware of the risk and knew how to respond, it was acceptable to give Boeing and regulators time to design and approve a permanent software fix to MCAS, the flight-control system implicated in the crash, according to the agency official and people briefed on the findings.

The FAA’s early goal, one of these people added, was: “Get something out immediately and then mandate something more permanent.”

Specifically, the FAA’s analysis suggested that a warning to pilots would be enough to provide Boeing about 10 months to design and implement changes to MCAS, according to a person close to the manufacturer. Boeing had been planning to complete the changes by April, within the 10-month period, this person said.

Boeing and the FAA’s risk projections faced a real-world crisis in less than five months. Ethiopian Airlines Flight 302 went down on March 10 in a similar nosedive prompted by the same type of automated MCAS commands pilots couldn’t overcome. The dual crashes took a total of 346 lives.

Investigators quickly focused on the central role of MCAS, and regulators around the world grounded the aircraft.

The FAA has said it doesn’t have a deadline for approving the final package of fixes but won’t allow the planes back in the air until all safety issues are resolved.

A Boeing spokesman said: “Boeing and the FAA both agreed, based on the results of their respective rigorous safety processes, that the initial action of reinforcing existing pilot procedures…and then the development and fielding of a software update, were the appropriate actions.”

He added: “The safety of everyone flying our airplanes was paramount as the analysis was done and the actions were taken.”

The FAA’s internal analysis, prepared in the days immediately following the Oct. 29 Lion Air crash, is called a TARAM, an acronym that stands for Transport Airplane Risk Assessment Methodology. It essentially involves a spreadsheet with formulas that consider a number of factors—such as fleet size, probability that sensors will fail, passenger counts—and aims to predict how many people could die over a certain period because of potential hazards, according to people familiar with the process.

There is also a subjective analysis that, along with the TARAM’s numerical forecasts, informs FAA managers and engineers about what types of actions to take and when—for major but also less-serious air-safety issues. “It’s kind of a cold way of looking at it,” the person briefed on the analysis said, adding: “It’s not foolproof. It’s a tool.”

The analysis determined that the underlying risks from the MCAS design were unacceptably high without at least some FAA action, that they exceeded internal FAA safety standards and that the likelihood of another emergency or even accident “was over our threshold,” according to the FAA official. “We decided…it was not an acceptable situation,” the official said.

The world’s largest brewer just made $1 billion from its new venture’s arm

A few years ago, Carlos Brito, chief executive of the world’s largest brewer Anheuser-Busch InBev (AB InBev), was faced with a fundamental issue. During an introductory presentation to new trainees, Brito was asked a big question: What would the world miss if the company didn’t exist?

At the time, he didn’t have a good answer, recalls Pedro Earp, who leads the company’s innovation and investment group ZX Ventures and is also AB InBev’s chief marketing officer, responsible for brands such as Budweiser, Corona, and Stella Artois.

“He came back to the leadership team and said, guys, we need to have a very clear reason why the world would not be a great place if we did not exist. So, we did a bit of soul searching,” Earp told CNBC.

The team looked back on the history of beer and realized that it had been a social lubricant for thousands of years.

“We are actually in the business of bringing people together. It’s archaeologically and historically true, you know beer has been bringing people together for more than 10,000 years. You know (in) the earliest civilizations people actually started getting together … partly to brew beer. And that’s kind of our purpose, our purpose is to bring people together,” Earp said.

Having a purpose beyond simply selling products is much talked about in marketing and was a big topic at industry conference Cannes Lions this year (even burritos have a mission over just filling a lunch gap) and Earp has previously said that employees need to see and believe that their goal serves a higher purpose than just sales — hence that existential question asked of Brito.

Like other companies, AB InBev had not focused enough on innovation. The company had been talking about it since around 2010, and got “incrementally better,” Earp said, but it needed to speed it up. “The problem with innovation is that innovation takes time, it requires effort, it doesn’t pay back overnight. So, whenever you let some of the innovation efforts compete with a core business, you know innovation in the long term is also second priority.”

But in 2015, it made a big bet on innovation, hiring a bunch of people for ZX Ventures and housing it in a different building with its own separate business functions like HR and finance. Four years on, its new brands including Saturday Session low-alcohol canned wine, beer delivery app Ze Delivery and vending machine Beer Box have collectively made $1 billion in sales.

AB InBev has grown through aggressive acquisitions, buying SABMiller in 2016 in a deal worth $100 billion, and has been working to reduce the debt pile that contributed to it. Last week, it agreed to sell its Australian operations to Japan’s Asahi for about $11.3 billion in enterprise value, after it called off an initial public offering (IPO) of its Asia-Pacific unit.

Part of Earp’s task is to find new ways to grow when beer sales are declining in the U.S — the Beer Purchasers’ Index, a metric used by the National Beer Wholesalers Association to track beer sales, fell to 48 in June from 62 in the same month last year — and along with low or no-alcohol products, some of the solutions seem to be in selling beer differently.

It has more than 500 bars that it owns internationally and it has launched e-commerce sites too. The bars are a great way to test out new products, Earp said, and the e-commerce sites provide insights on what people are looking for. On its Brazilian e-commerce site Emporio da Cerveja, for example, it noticed that people were searching for Becks, which wasn’t available in the country. So, it added the brand to the website and it shot straight into the top five beers. Latin America is one region where beer sales are increasing, although at a slower rate than in the early 2000s.

Earp plans to bring what he’s learned with ZX to the rest of the business. “We’re going to a second phase, which is how can you bring some of these learnings and bring them to the core business, how can we become more agile, how can you come closer to start-ups?” he told CNBC. At the same time, Earp will use some of AB InBev’s huge reach to scale some of the products coming out of ZX.

Here are the best Dow stocks to buy on the day Fed cuts rates

PUBLISHED AN HOUR AGO

The Federal Reserve is expected to cut rates this week for the first time since 2008, potentially giving investors the green light to play offense. CNBC took a look at stocks that tend to pop on the day the central bank pulls the trigger.



CNBC analysis using Kensho, a hedge fund analytics tool, found the stocks in the Dow Jones Industrial Average with the highest one-day return when the Fed initially cut rates in each cycle going back to 1990. The first rate reduction in every easing cycle took place in 1995, 1998, 2001, 2003 and 2007. General Electric and DuPont are excluded as they are no longer in the Dow.

The 30-stock index climbed 0.7% on average on rate-cut day as an easier monetary policy is typically bullish for stocks especially cyclicals like industrials. Procter & Gamble takes the cake as the best-performing stock in the Dow on decision day, rising 2.2% on average. Caterpillar and 3M both jumped nearly about 1.9% when the Fed lowered interest rates.

Investors have piled into big dividend payers on rate-cut day as Verizon, Chevron and P&G, all having attractive dividend yields, have done well in the past.

The Fed will announce its latest decision on whether to adjust interest rates at 2 p.m. ET Wednesday. The central bank is widely expected to cut its benchmark lending rate for the first time in more than 10 years. Fed Chair Jerome Powell has signaled his willingness to do what it takes to sustain the record-long expansion.

USDA announces details of support package for farmers

WASHINGTON — The details of the United States Department of Agriculture’s $16 billion package aimed at supporting American agricultural producers were released Thursday.

The details were announced by U.S. Secretary of Agriculture Sonny Perdue and discussed the USDA’s Market Facilitation Program, Food Purchase and Distribution Program and Agricultural Trade Promotion Program.

In May, President Donald Trump directed Perdue to craft a relief strategy in line with the estimated impacts of tariffs on U.S. agricultural goods and other trade disruptions. The aforementioned programs are designed to assist agricultural producers while Trump works to address market access barriers.

USDA’S MARKET FACILITATION PROGRAM

When it comes to the Market Facilitation Program, sign up at local Farm Service Agency offices starts Monday and continues through Dec. 6. Payments will be made by the Farm Service Agency under the authority of the Commodity Credit Corporation Charter Act to producers of alfalfa hay, barley, canola, corn, crambe, dried beans, dry peas, extra-long staple cotton, flaxseed, lentils, long grain and medium grain rice, millet, mustard seed, oats, peanuts, rapeseed, rye, safflower, sesame seed, small and large chickpeas, sorghum, soybeans, sunflower seed, temperate japonica rice, triticale, upland cotton, and wheat.

Assistance for those non-specialty crops is based on a single county payment rate multiplied by a farm’s total plantings of MFP-eligible crops in aggregate in 2019. Those per-acre payments are not dependent on which of those crops are planted in 2019.

A producer’s total payment-eligible plantings cannot exceed total 2018 plantings. County payment rates range from $15 to $150 per acre, depending on the impact of unjustified trade retaliation in that county.

Dairy producers who were in business as of June 1, 2019, will receive a per hundredweight payment on production history and hog producers will receive a payment based on the number of live hogs owned on a day selected by the producer between April 1 and May 15, 2019.

MFP payments also will be made to producers of almonds, cranberries, cultivated ginseng, fresh grapes, fresh sweet cherries, hazelnuts, macadamia nuts, pecans, pistachios, and walnuts. Each specialty crop will receive a payment based on 2019 acres of fruit or nut-bearing plants, or in the case of ginseng, based on harvested acres in 2019.

The acreage of non-specialty crops and cover crops must be planted by Aug. 1, 2019 to be considered eligible for MFP payments.

The MFP rule and a related Notice of Funding Availability will be published in the Federal Register on July 29, 2019, when signup begins at local FSA offices. Per-acre non-specialty crop county payment rates, specialty crop payment rates, and livestock payment rates are all currently available on farmers.gov.

MFP payments will be made in up-to three tranches, with the second and third tranches evaluated as market conditions and trade opportunities dictate. If conditions warrant, the second and third tranches will be made in November and early January, respectively. The first tranche will be comprised of the higher of either 50% of a producer’s calculated payment or $15 per acre, which may reduce potential payments to be made in tranches two or three. USDA will begin making first tranche payments in mid-to-late August.

MFP payments are limited to a combined $250,000 for non-specialty crops per person or legal entity. MFP payments also are limited to a combined $250,000 for dairy and hog producers and a combined $250,000 for specialty crop producers. However, no applicant can receive more than $500,000. Eligible applicants must also have an average adjusted gross income for tax years 2014, 2015, and 2016 of less than $900,000 or, 75% of the person’s or legal entity’s average AGI for tax years 2014, 2015, and 2016 must have been derived from farming and ranching. Applicants also must comply with the provisions of the Highly Erodible Land and Wetland Conservation regulations.

Many producers were affected by natural disasters this spring, such as flooding, that kept them out of the field for extended periods. Producers who filed a prevented planting claim and planted an FSA-certified cover crop, with the potential to be harvested qualify for a $15 per acre payment. Acres that were never planted in 2019 are not eligible for an MFP payment.

For more information on the MFP, visit www.farmers.gov/mfp or contact your local FSA office at (231) 757-3707 in Lake County or (231) 775-7681 in Missaukee, Osceola or Wexford counties.

USDA’S FOOD PURCHASE AND DISTRIBUTION PROGRAM

The Commodity Credit Corporation Charter Act authority also will be used to implement an up to $1.4 billion Food Purchase and Distribution Program through the Agricultural Marketing Service to purchase surplus commodities affected by trade retaliation such as fruits, vegetables, some processed foods, beef, pork, lamb, poultry and milk for distribution by the Food and Nutrition Service to food banks, schools and other outlets serving low-income individuals.

Agricultural Marketing Service will purchase the affected products in four phases starting on Oct. 1 with deliveries starting in January. The products purchased can be adjusted between phases to accommodate changes due to growing conditions; product availability; market conditions; trade negotiation status; and program capacity. The service will purchase known commodities firs and by purchasing in phases, procurements for commodities that have been sourced in the past can be purchased more quickly and included in the first phase.

USDA’S AGRICULTURAL TRADE PROMOTION PROGRAM

The USDA’s Foreign Agricultural Service will administer the Agricultural Trade Promotion Program under the authority of the Commodity Credit Corporation Charter Act.

The trade promotion program will provide cost-share assistance to eligible U.S. organizations for activities such as consumer advertising, public relations, point-of-sale demonstrations, participation in trade fairs and exhibits, market research, and technical assistance. During the week of July 15, USDA awarded $100 million to 48 organizations through the trade promotion program to help U.S. farmers and ranchers identify and access new export markets.

The 48 recipients are among the cooperator organizations that applied for $200 million in trade promotion program funds in 2018 that were awarded earlier this year. As part of a new round of support for farmers impacted by unjustified retaliation and trade disruption, those groups had the opportunity to be considered for additional support for their work to boost exports for U.S. agriculture, food, fish, and forestry products.

The list of trade promotion program funding recipients is available at www.fas.usda.gov/atp-funding-allocations.

The “nanny tax” must be paid for more than just nannies

You may have heard of the “nanny tax.” But even if you don’t employ a nanny, it may apply to you. Hiring a housekeeper, gardener or other household employee (who isn’t an independent contractor) may make you liable for federal income and other taxes. You may also have state tax obligations.

If you employ a household worker, you aren’t required to withhold federal income taxes from pay. But you may choose to withhold if the worker requests it. In that case, ask the worker to fill out a Form W-4. However, you may be required to withhold Social Security and Medicare (FICA) taxes and to pay federal unemployment (FUTA) tax.

FICA and FUTA tax

In 2019, you must withhold and pay FICA taxes if your household worker earns cash wages of $2,100 or more (excluding the value of food and lodging). If you reach the threshold, all the wages (not just the excess) are subject to FICA.

However, if a nanny is under age 18 and child care isn’t his or her principal occupation, you don’t have to withhold FICA taxes. So, if you have a part-time babysitter who is a student, there’s no FICA tax liability.

Both an employer and a household worker may have FICA tax obligations. As an employer, you’re responsible for withholding your worker’s FICA share. In addition, you must pay a matching amount. FICA tax is divided between Social Security and Medicare. The Social Security tax rate is 6.2% for the employer and 6.2% for the worker (12.4% total). Medicare tax is 1.45% each for both the employer and the worker (2.9% total).

If you want, you can pay your worker’s share of Social Security and Medicare taxes. If you do, your payments aren’t counted as additional cash wages for Social Security and Medicare purposes. However, your payments are treated as additional income to the worker for federal tax purposes, so you must include them as wages on the W-2 form that you must provide.

You also must pay FUTA tax if you pay $1,000 or more in cash wages (excluding food and lodging) to your worker in any calendar quarter. FUTA tax applies to the first $7,000 of wages paid and is only paid by the employer.

Reporting and paying

You pay household worker obligations by increasing your quarterly estimated tax payments or increasing withholding from wages, rather than making an annual lump-sum payment.

As a household worker employer, you don’t have to file employment tax returns, even if you’re required to withhold or pay tax (unless you own your own business). Instead, employment taxes are reported on your tax return on Schedule H.

When you report the taxes on your return, you include your employer identification number (not the same as your Social Security number). You must file Form SS-4 to get one.

However, if you own a business as a sole proprietor, you include the taxes for a household worker on the FUTA and FICA forms (940 and 941) that you file for your business. And you use your sole proprietorship EIN to report the taxes.

Keep careful records

Keep related tax records for at least four years from the later of the due date of the return or the date the tax was paid. Records should include the worker’s name, address, Social Security number, employment dates, dates and amount of wages paid and taxes withheld, and copies of forms filed.

Contact us for assistance or questions about how to comply with these employment tax requirements.

© 2019

Tesla; A Streetcar Named Desire

You’ve no doubt heard of the demand curve. But have you considered its close cousin, the desire curve? Elon Musk, CEO of Tesla Inc., shared some thoughts on this during Wednesday evening’s earnings call:

Let’s agree that people without access to adequate funds cannot buy things costing more than those inadequate funds. Plus – and this is the real kick in the teeth – those same people still sometimes want those things. Musk was responding to a question about why, if Tesla suffers from supply constraints rather than constrained demand, it had cut prices. Much of his answer didn’t really address that. Words to the effect of “our product may have intrinsic value approaching infinity, but not everyone has infinite money, so we charge a market price of quite a bit less than infinity” add up to a boast about what a fabulous bargain that product is. Fair enough, but ultimately just sales patter.

Despite delivering a record number of its electric vehicles in the second quarter, Tesla endured another round of financial losses despite pressure to become steadily profitable.

The losses come as the company is still spending heavily on capital projects. CEO Elon Musk said the automaker is on target to open a plant in China by the end of the year and is making plans for another in Europe.

The company is also ramping up to start producing its next vehicle, the mid-priced Model Y SUV, later this year. Tesla said it will potentially be more profitable than the Model 3 sedan, with which he shares about three-quarters of its parts.

"Tesla is expanding at an exponential rate," Musk said.

But it is still losing money at faster clip than predicted by analysts. Tesla lost $408.3 million in the quarter, an improvement from a $718.1 million loss a year earlier. Revenue totaled $6.35 billion, up 59% from a year earlier.

&P Global Market Intelligence analysts had estimated second-quarter revenue of $6.44 billion in revenue and a net loss of $298 million.

Musk said he expects the automaker to come close to breaking even in the current quarter and to make a profit in the final quarter. He also said demand continues to be strong.

The “nanny tax” must be paid for more than just nannies

You may have heard of the “nanny tax.” But even if you don’t employ a nanny, it may apply to you. Hiring a housekeeper, gardener or other household employee (who isn’t an independent contractor) may make you liable for federal income and other taxes. You may also have state tax obligations.

If you employ a household worker, you aren’t required to withhold federal income taxes from pay. But you may choose to withhold if the worker requests it. In that case, ask the worker to fill out a Form W-4. However, you may be required to withhold Social Security and Medicare (FICA) taxes and to pay federal unemployment (FUTA) tax.

FICA and FUTA tax

In 2019, you must withhold and pay FICA taxes if your household worker earns cash wages of $2,100 or more (excluding the value of food and lodging). If you reach the threshold, all the wages (not just the excess) are subject to FICA.

However, if a nanny is under age 18 and child care isn’t his or her principal occupation, you don’t have to withhold FICA taxes. So, if you have a part-time babysitter who is a student, there’s no FICA tax liability.

Both an employer and a household worker may have FICA tax obligations. As an employer, you’re responsible for withholding your worker’s FICA share. In addition, you must pay a matching amount. FICA tax is divided between Social Security and Medicare. The Social Security tax rate is 6.2% for the employer and 6.2% for the worker (12.4% total). Medicare tax is 1.45% each for both the employer and the worker (2.9% total).

If you want, you can pay your worker’s share of Social Security and Medicare taxes. If you do, your payments aren’t counted as additional cash wages for Social Security and Medicare purposes. However, your payments are treated as additional income to the worker for federal tax purposes, so you must include them as wages on the W-2 form that you must provide.

You also must pay FUTA tax if you pay $1,000 or more in cash wages (excluding food and lodging) to your worker in any calendar quarter. FUTA tax applies to the first $7,000 of wages paid and is only paid by the employer.

Reporting and paying

You pay household worker obligations by increasing your quarterly estimated tax payments or increasing withholding from wages, rather than making an annual lump-sum payment.

As a household worker employer, you don’t have to file employment tax returns, even if you’re required to withhold or pay tax (unless you own your own business). Instead, employment taxes are reported on your tax return on Schedule H.

When you report the taxes on your return, you include your employer identification number (not the same as your Social Security number). You must file Form SS-4 to get one.

However, if you own a business as a sole proprietor, you include the taxes for a household worker on the FUTA and FICA forms (940 and 941) that you file for your business. And you use your sole proprietorship EIN to report the taxes.

Keep careful records

Keep related tax records for at least four years from the later of the due date of the return or the date the tax was paid. Records should include the worker’s name, address, Social Security number, employment dates, dates and amount of wages paid and taxes withheld, and copies of forms filed.

Contact us for assistance or questions about how to comply with these employment tax requirements.

© 2019

China's Wanda Sports cuts U.S. IPO size, lowers price range

SINGAPORE (Reuters) - Wanda Sports Group Co Ltd, a unit of Chinese conglomerate Dalian Wanda Group, has cut the size of its U.S. initial public offering (IPO) to up to $308 million from a previous size of up to $500 million.

The firm set its IPO price range at $9 to $11 per American depositary share (ADS), compared with a previously stated range of $12 to $15, showed its latest prospectus filed with the U.S. Securities and Exchange Commission on Wednesday.

The cut indicates tepid U.S. investor demand for Chinese stocks after China’s largest live-streaming platform DouYu International Holdings Ltd (DOYU.O) priced its $775 million Nasdaq IPO at the bottom of its price range last week.

Wanda Sports, the owner of Swiss sports marketing firm Infront Sports & Media AG as well as World Triathlon Corp, the organizer and promoter of the Ironman race, also cut the number of ADSs on sale to 28 million from 33.33 million, it said in the prospectus.

Wanda Sports said it plans to use the IPO proceeds to repay debt, fund strategic investments and for general corporate purposes.

The company, which owns sports properties and generates revenue from events, sponsorship and media production, reported a profit of 54 million euros ($60 million) in 2018, a 31% drop from one year earlier. It reported a loss of 8.6 million euros in the first three months of 2019, the prospectus showed.

The IPO follows a string of asset sales by parent Dalian Wanda which had built an empire with businesses as varied as real estate, sports and films. In 2015, the conglomerate bought Infront Sports & Media and World Triathlon for $1.2 billion and $650 million respectively.

However the group, owned by Wang Jianlin, one of China’s richest men, began selling assets as the government in recent years discouraged overseas deals dependent on high leverage.

It has offloaded domestic and overseas holdings, including stakes in cinema operator AMC Entertainment and Spanish soccer club Atletico Madrid and a handful of property developments.

Wanda Sports is due to start trading on Friday under the symbol “WSG” on the Nasdaq.

Citigroup, Deutsche Bank and Morgan Stanley are the leading banks on the IPO.

ExxonMobil and Global Thermostat to Advance Breakthrough Atmospheric Carbon Capture Technology

IRVING, Texas--(BUSINESS WIRE)--ExxonMobil and Global Thermostat said today that they have signed a joint development agreement to advance breakthrough technology that can capture and concentrate carbon dioxide emissions from industrial sources, including power plants, and the atmosphere.

The companies will evaluate the potential scalability of Global Thermostat’s carbon capture technology for large industrial use. If technical readiness and scalability is established, pilot projects at ExxonMobil facilities could follow.

“Advancing technologies to capture and concentrate carbon dioxide for storage and potential industrial use is among a suite of ExxonMobil research programs focused on developing lower-emissions solutions to mitigate the risks of climate change,” said Vijay Swarup, vice president of research and development for ExxonMobil Research and Engineering Company.

“Our scientists see potential in this exciting technology that could lead to more affordable methods to reduce emissions in power generation and manufacturing, along with removing carbon dioxide from the atmosphere.”

ExxonMobil and Global Thermostat are also exploring opportunities to identify economic uses for captured carbon dioxide.

“Scaling solutions that can address climate change globally requires significant investment, innovation and collaboration,” said Peter Eisenberger, chief technology officer and co-founder of Global Thermostat.

“Global Thermostat’s game-changing direct-air capture and flue gas capture technologies offer a way to transform the risks associated with carbon dioxide emissions into a global solution that could satisfy both business and environmental objectives. By partnering with ExxonMobil, we’re harnessing the expertise and capabilities of one of the world’s largest energy companies to accelerate our ability to realize that vision.”

ExxonMobil’s partnership with Global Thermostat expands the company’s collaborative efforts with other companies and academic institutions that are focused on developing new energy technologies, improving energy efficiency and reducing greenhouse gas emissions. The company recently committed to spend up to $100 million over 10 years on research with the U.S. Department of Energy’s National Renewable Energy Laboratory and National Energy Technology Laboratory to bring lower-emissions technologies to commercial scale. Since 2000, ExxonMobil has invested more than $9 billion in energy efficiency and lower-emission technologies such as carbon capture and next generation biofuels. ExxonMobil also works with about 80 universities around the world to explore next-generation energy technologies.

About ExxonMobil

ExxonMobil, the largest publicly traded international oil and gas company, uses technology and innovation to help meet the world’s growing energy needs. ExxonMobil holds an industry-leading inventory of resources, is one of the largest refiners and marketers of petroleum products, and its chemical company is one of the largest in the world. For more information, visit www.exxonmobil.com or follow us on Twitter at www.twitter.com/exxonmobil.

About Global Thermostat

Formed in 2010, Global Thermostat (GT) is commercializing its advanced, multi-patented technology to transform Carbon Dioxide from a global liability into an opportunity for global prosperity. Using its proven, breakthrough technology, GT economically captures and concentrates CO2, enabling its profitable re-use across multiple large & growing industries – reducing harmful emissions, and helping to close the global carbon cycle.

Cautionary Statement: Statements of future events or conditions in this release are forward-looking statements. Actual future results, the development, implementation and results of new technologies, including efficiency gains and emission reductions, could vary depending on the outcome of further research and testing; the development and competitiveness of alternative technologies; the ability to scale pilot projects on a cost-effective basis; political and regulatory developments including actions that may favor certain types of technologies over others; actions of competitors; the outcome of commercial negotiations; and other factors discussed in this release and under the heading “Factors Affecting Future Results” on the Investors page of ExxonMobil’s website at exxonmobil.com.