CrossAmerica Partners LP

Note 1. DESCRIPTION OF BUSINESS AND OTHER DISCLOSURES

Our business consists of:

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the wholesale distribution of motor fuels;

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the owning or leasing of sites used in the retail distribution of motor fuels and, in turn, generating rental income from the lease or sublease of the sites;

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the retail sale of motor fuels to end customers at retail sites operated by commission agents and ourselves; and

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the operation of retail sites, including the sale of convenience merchandise to end customers.

Interim Financial Statements

These unaudited condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information and with the instructions to Form 10-Q and the Exchange Act. Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. All such adjustments are of a normal recurring nature unless disclosed otherwise. Management believes that the disclosures made are adequate to keep the information presented from being misleading. The financial statements contained herein should be read in conjunction with the consolidated financial statements and notes thereto included in our Form 10-K. Financial information as of June 30, 2026 and for the three and six months ended June 30, 2026 and 2025 included in the consolidated financial statements has been derived from our unaudited financial statements. Financial information as of December 31, 2025 has been derived from our audited financial statements and notes thereto as of that date.

Operating results for the three and six months ended June 30, 2026 are not necessarily indicative of the results that may be expected for the year ending December 31, 2026. Our business exhibits seasonality due to our wholesale and retail sites being located in certain geographic areas that are affected by seasonal weather and temperature trends and associated changes in retail customer activity during different seasons. Historically, sales volumes have been highest in the second and third quarters (during the summer activity months) and lowest during the winter months in the first and fourth quarters.

Use of Estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results and outcomes could differ from those estimates and assumptions. On an ongoing basis, management reviews its estimates based on currently available information. Changes in facts and circumstances could result in revised estimates and assumptions.

Reclassifications

Certain prior-year balance sheet amounts were reclassified to conform to the current-year presentation.

New Accounting Pronouncements Pending Adoption

In November 2024, the FASB issued ASU 2024-03, "Disaggregation of Income Statement Expenses.” The amendments in this new guidance require disclosure, in the notes to financial statements, of specified information about certain costs and expenses, including with respect to purchases of inventory, employee compensation, depreciation and intangible asset amortization. These new disclosures will be required in our Annual Report on Form 10-K for the year ending December 31, 2027 and interim and annual reports thereafter. Although we do not anticipate the impact of adopting this guidance will be material, it will affect our disclosures.

Concentration Risk

For the six months ended June 30, 2026 and 2025, respectively, we purchased approximately 81% and 79% of our motor fuel from four suppliers. Approximately 20% and 22% of our motor fuel gallons sold for the six months ended June 30, 2026 and 2025, respectively, were delivered by our toptwo carriers.

For each of the six months ended June 30, 2026 and 2025, approximately 56% of our merchandise was purchased fromone supplier.

Note 2. ASSETS HELD FOR SALE

We have classified 19 sites and 24 sites as held for sale at June 30, 2026 and December 31, 2025, respectively, which are expected to be sold within one year of such classification. Assets held for sale were as follows (in thousands):

The Partnership has continued to focus on optimizing the class of trade for its assets, which has included divesting certain assets, often lower performing, while seeking to maintain a wholesale fuel supply relationship whenever possible. During the three and six months ended June 30, 2026, we sold 5 and 21 properties for $2.7 million and $15.4 million in proceeds, resulting in net gains of $1.1 million and $7.4 million, respectively. During the three and six months ended June 30, 2025, we sold 60 and 67 properties for $64.0 million and $72.6 million in proceeds, resulting in net gains of $29.7 million and $35.2 million, respectively.

See Note 4 for information regarding impairment charges primarily recorded upon classifying sites within assets held for sale.

Note 3. INVENTORY

Inventory consisted of the following (in thousands):

Note 4. PROPERTY AND EQUIPMENT

Property and equipment, net consisted of the following (in thousands):

We recorded impairment charges of $1.3 million and $6.1 million during the three months ended June 30, 2026 and 2025, and $2.8 million and $14.9 million during the six months ended June 30, 2026 and 2025, respectively, included within depreciation, amortization and accretion expense on the statements of operations. These impairment charges were primarily related to sites initially classified within assets held for sale in connection with our ongoing real estate optimization effort.

Note 5. INTANGIBLE ASSETS

Intangible assets consisted of the following (in thousands):

Note 6. DEBT

Our balances for long-term debt and finance lease obligations were as follows (in thousands):

As of June 30, 2026, future principal payments on debt and future minimum rental payments on finance lease obligations were as follows (in thousands):

The Credit Facility is secured by substantially all of the Partnership’s assets.

Letters of credit outstanding totaled $4.9 million at both June 30, 2026 and December 31, 2025.

Taking the interest rate swap contracts into account, the effective interest rate on our Credit Facility was 5.5% (with an applicable margin of 2.00%) and 5.6% (with an applicable margin of 2.00%) at June 30, 2026 and December 31, 2025, respectively. See Note 7 for additional information on our interest rate swap contracts.

On July 15, 2026, the Partnership and its subsidiary, Lehigh Gas Wholesale Services, Inc., entered into an amendment to the Credit Facility (the "Credit Facility Amendment"). The Credit Facility Amendment, among other things, (x) extends the maturity date from March 31, 2028 to July 15, 2031, (y) removes the SOFR credit spread adjustment and (z) amends the applicable financial covenant to require the Partnership to maintain a Consolidated Leverage Ratio (as defined in the Credit Facility) of (i) for each fiscal quarter ending June 30, 2026, September 30, 2026, December 31, 2026, March 31, 2027, June 30, 2027 and September 30, 2027, not greater than 5.00 to 1.00, and (ii) for each fiscal quarter ending December 31, 2027 and thereafter, not greater than 4.75 to 1.00. All other terms and conditions of the Credit Facility remain in full force and effect.

As of June 30, 2026, we were in compliance with our financial covenants under the Credit Facility. The amount of availability under the Credit Facility at June 30, 2026, after taking into consideration debt covenant restrictions, was $248.5 million.

Cash paid for interest, including debt and finance lease obligations, amounted to $21.3 million and $24.6 million for the six months ended June 30, 2026 and 2025, respectively.

Finance Lease Obligations

In May 2012, the Predecessor Entity entered into a 15-year master lease agreement with renewal options of up to an additional 20 years with Getty. Since then, the agreement has been amended from time to time to add or remove sites. As of December 31, 2025, we leased 106 sites under this lease. We paid fixed rent, which increased 1.5% per year. In addition, the lease required variable lease payments based on gallons of motor fuel sold.

Because the fair value of the land at lease inception was estimated to represent more than 25% of the total fair value of the real property subject to the lease, the land element of the lease was analyzed for operating or capital treatment separately from the rest of the property subject to the lease. The land element of the lease was classified as an operating lease and all of the other property was classified as a capital lease. This assessment was not required to be reassessed upon adoption of ASC 842–Leases.

On January 31, 2026, we entered into an amendment of this lease with Getty. The amendment reset the rents for all 106 sites to an aggregate $6.9 million in annual rent, subject to annual escalations of 1.5%. The amendment also removed provisions requiring us to pay variable rent based on fuel volume.

Through this amendment, we also exercised a renewal option that extends the term through April 30, 2037 and have an additional renewal option that could extend the term through April 30, 2047. The amendment provides for a purchase option to us that can be exercised between October 1, 2026 and June 30, 2027 for up to 25 sites for up to $6.6 million, which is reasonably certain to be exercised. The amendment also provides for a purchase option to us for up tonine additional sites during certain timeframes of the term at values to be agreed upon, which is not reasonably certain to be exercised. Getty has the option to recapture up tosix sites during certain timeframes of the term as well, which is also not reasonably certain to be exercised. We have a right of first offer should Getty seek to sell or convey any of the leased properties.

This amendment triggered a reassessment of the lease accounting. Effective January 31, 2026, we are accounting for the modified lease as a finance lease. With respect to the 25 sites for which it is reasonably certain we will exercise our purchase option and have the intent and ability to do so, we are accounting for the finance lease using an anticipated purchase date of October 1, 2026. With respect to the 81 remaining sites, we are accounting for the finance lease through the end of the current term expiring on April 30, 2037. We recorded increases in our finance lease obligations and right-of-use assets under finance leases of $56.3 million during the first quarter of 2026. The weighted-average discount rate for this finance lease obligation was 6.0% at June 30, 2026. Interest on finance lease obligations amounted to $0.9 million and an insignificant amount for the three months ended June 30, 2026 and 2025, and $1.2 million and $0.1 million for the six months ended June 30, 2026 and 2025, respectively.

Note 7. INTEREST RATE SWAP CONTRACTS

During 2026 and 2025, we held the following interest rate swap contracts (in thousands):

Our interest rate swap contracts fix the rate on a portion of our SOFR-based borrowings under our Credit Facility, have been designated as cash flow hedges and are expected to be highly effective.

The fair value of these interest rate swap contracts was reported as a separate line item within current assets, current liabilities, noncurrent assets and noncurrent liabilities, as applicable. See Note 10 for additional information on the fair value of the interest rate swap contracts.

We report the unrealized gains and losses on our interest rate swap contracts designated as highly effective cash flow hedges as a component of other comprehensive income and reclassify such gains and losses into earnings (interest expense on our statement of operations) in the same period during which the hedged interest expense is recorded. We recognized a net realized gain from settlements of the interest rate swap contracts of $0.2 million and $0.9 million for the three months ended June 30, 2026 and 2025 and $0.5 million and $1.9 million for the six months ended June 30, 2026 and 2025, respectively.

We currently estimate that a net gain of $2.1 million will be reclassified from AOCI into interest expense during the next 12 months; however, the actual amount that will be reclassified will vary based on changes in interest rates.

Note 8. RELATED-PARTY TRANSACTIONS

Wholesale Motor Fuel Sales and Real Estate Rentals

Revenues from TopStar, an entity affiliated with the Topper Group, were $12.9 million and $9.1 million for the three months ended June 30, 2026 and 2025 and $22.0 million and $17.9 million for the six months ended June 30, 2026 and 2025, respectively. Accounts receivable from TopStar was $0.7 million at both June 30, 2026 and December 31, 2025.

In February 2025, we purchased a property from TopStar for $0.2 million.

We lease certain real estate from the Topper Group. Rent expense under these lease agreements was $2.2 million and $2.5 million for the three months ended June 30, 2026 and 2025 and $4.5 million and $5.0 million for the six months ended June 30, 2026 and 2025, respectively.

Omnibus Agreement

We incurred expenses under the Omnibus Agreement, including costs for store level personnel at our company operated sites as well as other cost reimbursements, totaling $30.9 million and $32.8 million for the three months ended June 30, 2026 and 2025 and $61.2 million and $64.7 million for the six months ended June 30, 2026 and 2025, respectively. Such expenses are included in operating expenses and general and administrative expenses in the statements of operations. Amounts payable to the Topper Group related to expenses incurred by the Topper Group on our behalf in accordance with the Omnibus Agreement totaled $5.8 million and $4.6 million at June 30, 2026 and December 31, 2025, respectively.

Common Unit Distributions and Other Equity Transactions

We distributed $7.7 million to the Topper Group related to its ownership of our common units for each of the three months ended June 30, 2026 and 2025 and $15.4 million for each of the six months ended June 30, 2026 and 2025.

We distributed $2.6 million to affiliates of John B. Reilly, III, a member of our Board, related to their ownership of our common units for each of the three months ended June 30, 2026 and 2025 and $5.3 million and $5.2 million for the six months ended June 30, 2026 and 2025, respectively.

We recorded accretion on the preferred membership interests issued in March 2022 to related parties of $0.7 million for each of the three months ended June 30, 2026 and 2025 and $1.4 million and $1.3 million for the six months ended June 30, 2026 and 2025, respectively. We paid income tax distributions of $0.2 million related to the preferred membership interests for the three and six months ended June 30, 2026.

Maintenance and Environmental Costs

Certain maintenance and environmental remediation activities are performed by an entity affiliated with the Topper Group, as approved by the independent conflicts committee of the Board. We incurred charges with this related party of $0.5 million and $0.4 million for the three months ended June 30, 2026 and 2025 and $0.9 million and $1.1 million for the six months ended June 30, 2026 and 2025, respectively. Accounts payable to this related party amounted to $0.3 million at both June 30, 2026 and December 31, 2025.

Environmental Remediation Indemnification

Under an indemnification agreement, DMI reimburses us for certain environmental remediation costs incurred by the Partnership. We received $0.1 million for each of the three months ended June 30, 2026 and 2025 and $0.3 million and $0.2 million for the six months ended June 30, 2026 and 2025, respectively.

Convenience Store Products

We purchase certain convenience store products from an affiliate of John B. Reilly, III and Joseph V. Topper, Jr., members of the Board, as approved by the independent conflicts committee of the Board. Merchandise costs amounted to $4.8 million for each of the three months ended June 30, 2026 and 2025 and $9.2 million and $9.1 million for the six months ended June 30, 2026 and 2025, respectively. Amounts payable to this related party amounted to $1.6 million and $1.7 million at June 30, 2026 and December 31, 2025, respectively.

Vehicle Lease

In connection with the services rendered under the Omnibus Agreement, we lease certain vehicles from an entity affiliated with the Topper Group, as approved by the independent conflicts committee of the Board. Lease expense was aninsignificant amount for each of the three months ended June 30, 2026 and 2025 and $0.1 million for each of the six months ended June 30, 2026 and 2025.

Principal Executive Offices

We lease office space from an affiliate of John B. Reilly, III and Joseph V. Topper, Jr., members of our Board, as approved by the independent conflicts committee of the Board. Rent expense amounted to $0.3 million for each of the three months ended June 30, 2026 and 2025 and $0.6 million for each of the six months ended June 30, 2026 and 2025.

Public Relations and Website Consulting Services

We have engaged a company affiliated with John B. Reilly, III, member of the Board, for public relations and website consulting services. The cost of these services was insignificant for the three and six months ended June 30, 2026 and 2025.

Note 9. COMMITMENTS AND CONTINGENCIES

Purchase Commitments

We have minimum volume purchase requirements under certain of our fuel supply agreements with a purchase price at prevailing market rates for wholesale distribution. In the event we fail to purchase the required minimum volume for a given contract period, the underlying third party’s exclusive remedies (depending on the magnitude of the failure) are either termination of the supply agreement and/or a financial penalty per gallon based on the volume shortfall for the given period. We did not pay any significant penalties in any period presented.

Litigation Matters

We are from time to time party to various lawsuits, claims and other legal proceedings that arise in the ordinary course of business. These actions typically seek, among other things, compensation for alleged personal injury, breach of contract, property damages, environmental damages, employment-related claims and damages, punitive damages, civil penalties or other losses, or injunctive or declaratory relief. With respect to all such lawsuits, claims and proceedings, we record an accrual when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. In addition, we disclose matters for which management believes a material loss is at least reasonably possible. We believe that it is not reasonably possible that these proceedings, separately or in the aggregate, will have a material adverse effect on our consolidated financial position, results of operations or cash flows. In all instances, management has assessed the matter based on current information and made a judgment concerning its potential outcome, giving due consideration to the nature of the claim, the amount and nature of damages sought and the probability of success. Management’s judgment may prove materially inaccurate, and such judgment is made subject to the known uncertainties of litigation.

Environmental Matters

We currently own or lease sites where refined petroleum products are being or have been handled. These sites and the refined petroleum products handled thereon may be subject to federal and state environmental laws and regulations. Under such laws and regulations, we could be required to remove or remediate containerized hazardous liquids or associated generated wastes (including wastes disposed of or abandoned by prior owners or operators), to remediate contaminated property arising from the release of liquids or wastes into the environment, including contaminated groundwater, or to implement best management practices to prevent future contamination.

We maintain insurance of various types with varying levels of coverage that is considered adequate under the circumstances to cover operations and properties. The insurance policies are subject to deductibles that are considered reasonable and not excessive. In addition, we have generally entered into indemnification agreements with various sellers in conjunction with our past acquisitions, as further described below. Financial responsibility for environmental remediation is negotiated in connection with each acquisition transaction. In each case, an assessment is made of potential environmental liability exposure based on available information. Based on that assessment and relevant economic and risk factors, a determination is made whether to, and the extent to which we will, assume liability for existing environmental conditions.

Environmental liabilities recorded on the balance sheet within accrued expenses and other current liabilities and other long-term liabilities totaled $9.8 million and $9.7 million at June 30, 2026 and December 31, 2025, respectively. Indemnification assets related to state funds or insurance recorded on the balance sheet within other current and other noncurrent assets totaled $8.4 million and $8.3 million at June 30, 2026 and December 31, 2025, respectively. State funds represent probable state reimbursement amounts. Reimbursement will depend upon the continued maintenance and solvency of the state. Insurance coverage represents amounts deemed probable of reimbursement under insurance policies.

The estimates used in these reserves are based on all known facts at the time and an assessment of the ultimate remedial action outcomes. We will adjust loss accruals as further information becomes available or circumstances change. Among the many uncertainties that impact the estimates are the necessary regulatory approvals for, and potential modifications of, remediation plans, the amount of data available upon initial assessment of the impact of soil or water contamination, changes in costs associated with environmental remediation services and equipment and the possibility of existing legal claims giving rise to additional claims.

Environmental liabilities related to the sites contributed to the Partnership in connection with our IPO have not been assigned to us and are still the responsibility of the Predecessor Entity. The Predecessor Entity indemnified us for any costs or expenses that we incur for environmental liabilities and third-party claims, regardless of when a claim is made, that are based on environmental conditions in existence prior to the closing of the IPO for contributed sites. As such, these environmental liabilities and indemnification assets are not recorded on the consolidated balance sheet of the Partnership.

Similarly, we have generally been indemnified with respect to known contamination at sites acquired from third parties. As such, these environmental liabilities and indemnification assets are also not recorded on the consolidated balance sheet of the Partnership.

Note 10. FAIR VALUE MEASUREMENTS

We measure and report certain financial and non-financial assets and liabilities on a fair value basis. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). U.S. GAAP specifies a three-level hierarchy that is used when measuring and disclosing fair value. The fair value hierarchy gives the highest priority to quoted prices available in active markets (i.e., observable inputs) and the lowest priority to data lacking transparency (i.e., unobservable inputs). An instrument’s categorization within the fair value hierarchy is based on the lowest level of significant input to its valuation.

Transfers into or out of any hierarchy level are recognized at the end of the reporting period in which the transfers occurred. There were no transfers between any levels in 2026 or 2025.

As further discussed in Note 7, we remeasure the fair value of interest rate swap contracts on a recurring basis each balance sheet date. We used an income approach to measure the fair value of these contracts, utilizing a forward yield curve for the same period as the future interest rate swap settlements. These fair value measurements are classified as Level 2 measurements.

We have accrued for outstanding phantom units as a liability and adjust that liability on a recurring basis based on the market price of our common units each balance sheet date. These fair value measurements are deemed Level 1 measurements.

The fair value of our accounts receivable, notes receivable, and accounts payable approximated their carrying values as of June 30, 2026 and December 31, 2025 due to the short-term maturity of these instruments. The fair value of borrowings under the Credit Facility approximated its carrying value as of June 30, 2026 and December 31, 2025 due to the frequency with which interest rates are reset and the consistency of the market spread.

Note 11. INCOME TAXES

As a limited partnership, we are not subject to federal and state income taxes. However, our corporate subsidiaries are subject to income taxes. Income tax attributable to our taxable income (including any dividend income from our corporate subsidiaries), which may differ significantly from income for financial statement purposes, is assessed at the individual limited partner unitholder level. We are subject to a statutory requirement that non-qualifying income, as defined by the Internal Revenue Code, cannot exceed 10% of total gross income for the calendar year. If non-qualifying income exceeds this statutory limit, we would be taxed as a corporation. The non-qualifying income did not exceed the statutory limit in any annual period.

Certain activities that generate non-qualifying income are conducted through our wholly owned taxable corporate subsidiaries. Current and deferred income taxes are recognized on the earnings of these subsidiaries. Deferred income tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and are measured using enacted tax rates.

We recorded income tax expense of $3.3 million and $3.9 million for the three months ended June 30, 2026 and 2025 and $5.8 million and $0.3 million for the six months ended June 30, 2026 and 2025, respectively, as a result of the income generated by our corporate subsidiaries. The effective tax rate differs from the combined federal and state statutory rate primarily because only our corporate subsidiaries are subject to income tax.

Cash paid for income taxes, net of refunds received, amounted to $7.2 million and $2.8 million for the six months ended June 30, 2026 and 2025, respectively.

Note 12. NET INCOME PER COMMON UNIT

The following table provides a reconciliation of net income and weighted-average units used in computing basic and diluted net income per common unit for the following periods (in thousands, except unit and per unit amounts):

a)

For the three and six months ended June 30, 2026,1,329,127 potentially dilutive units related to the preferred membership interests were excluded from the calculation of diluted earnings per unit because including them would have been antidilutive.

For the three months ended June 30, 2025, dilutive units related to the preferred membership interests were included in the denominator of the calculation of diluted earnings per unit. Similarly, the accretion of the preferred membership interests was added back in the numerator of the calculation as if the preferred membership interests had been converted to common units at the beginning of the period, in which case no accretion would have been recorded.

For the six months ended June 30, 2025,1,273,291 potentially dilutive units related to the preferred membership interests were excluded from the calculation of diluted earnings per unit because including them would have been antidilutive.

Distributions

Distribution activity for 2026 is as follows:

The amount of any distribution is subject to the discretion of the Board, which may reduce or eliminate the cash distribution at any time. Our Partnership Agreement does not require us to pay any distributions. As such, there can be no assurance we will continue to pay distributions in the future.

Note 13. SEGMENT REPORTING

We conduct our business intwo reportable segments: 1) the wholesale segment and 2) the retail segment.

The wholesale segment includes the wholesale distribution of motor fuel to lessee dealers and independent dealers. We have exclusive motor fuel distribution contracts with lessee dealers who lease the property from us. We also have exclusive distribution contracts with independent dealers to distribute motor fuel but do not collect rent from the independent dealers.

The retail segment includes the retail sale of motor fuel at retail sites operated by commission agents and the sale of convenience merchandise and the retail sale of motor fuel at company operated sites. A commission agent site is a retail site where we retain title to the motor fuel inventory and sell it directly to our end user customers. At commission agent retail sites, we manage motor fuel inventory pricing and retain the gross profit on motor fuel sales, less a commission to the agent who operates the retail site. Similar to our wholesale segment, we also generate revenues through leasing or subleasing real estate in our retail segment.

Unallocated items consist primarily of general and administrative expenses, depreciation, amortization and accretion expense, gains on dispositions and lease terminations, net, other income, interest expense and income tax expense. Total assets by segment are not presented as management does not currently assess performance or allocate resources based on that data.

During the three and six months ended June 30, 2025, respectively, we convertedsix and 24 sites from lessee dealer sites in the wholesale segment to company operated or commission agent sites in the retail segment, net.

The following table reflects activity related to our reportable segments (in thousands):

(a)

For the Wholesale and Retail segments, other segment items includes real estate taxes, utilities, management fees, insurance and other operating expenses. For the Retail segment, other segment items also includes rent expense, store supplies and shrink. Other segment items that are not allocated to a segment include general and administrative expenses, depreciation, amortization and accretion expense and gains/losses on dispositions and lease terminations, net.

A reconciliation from operating income to income before income taxes follows (in thousands):

Receivables relating to the revenue streams above are as follows (in thousands):

Performance obligations are satisfied as fuel is delivered to the customer and as merchandise is sold to the consumer. Many of our fuel contracts with our customers include minimum purchase volumes measured on a monthly basis, for which our performance obligations are satisfied as services are rendered. Receivables from fuel are recognized on a per-gallon rate and are generally collected within 10 days of delivery.

The balance of unamortized costs incurred to obtain certain contracts with customers was $9.6 million and $9.9 million at June 30, 2026 and December 31, 2025, respectively. Amortization of such costs is recorded against operating revenues and amounted to $0.5 million for each of the three months ended June 30, 2026 and 2025 and $1.0 million for each of the six months ended June 30, 2026 and 2025.

Receivables from rent and other lease-related charges are generally collected at the beginning of the month.

Note 14. SUPPLEMENTAL CASH FLOW INFORMATION

In order to determine net cash provided by operating activities, net income is adjusted by, among other things, changes in operating assets and liabilities as follows (in thousands):

The above changes in operating assets and liabilities may differ from changes between amounts reflected in the applicable balance sheets for the respective periods due to acquisitions and non-cash activity.

Supplemental schedule of non-cash investing and financing activities (in thousands):