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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2022
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 Number: 001-39352
Mirion Technologies, Inc.
(Exact name of registrant as specified in its charter)
Delaware83-0974996
(State or other jurisdiction of
 incorporation or organization)

(I.R.S. Employer
Identification Number)
1218 Menlo Drive
Atlanta, Georgia 30318
(Address of Principal Executive Office)
(770) 432-2744
(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading symbol(s)
Name of each exchange on which registered
Class A Common Stock, $0.0001 par value per share
MIR
New York Stock Exchange
Redeemable warrants, each exercisable for one share of Class A common stock at an exercise price of $11.50
MIR WS
New 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 ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

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 FilerAccelerated Filer
Non-accelerated FilerSmaller 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). o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes ☐ No
As of May 2, 2022, there were 199,583,232 shares of Class A common stock, $0.0001 par value per share, and 8,510,540 shares of Class B common stock, $0.0001 par value per share, issued and outstanding.




INTRODUCTORY NOTE

On October 20, 2021 (the "Closing" or the “Closing Date”), Mirion Technologies, Inc. (formerly known as GS Acquisition Holdings Corp II or "GSAH") consummated its business combination with GSAH (the "Business Combination") pursuant to the Business Combination Agreement dated June 17, 2021 (as amended, the “Business Combination Agreement”). On the Closing Date, GSAH was renamed Mirion Technologies, Inc.

Unless the context otherwise requires, all references in this Quarterly Report on Form 10-Q to “Mirion,” the “Company,” “we,” “us” or “our” refer to Mirion Technologies, Inc. following the Business Combination, other than certain historical information which refers to the business of Mirion Technologies (TopCo), Ltd. (“Mirion TopCo”) prior to the consummation of the Business Combination.

As a result of the Business Combination, Mirion’s financial statement presentation distinguishes Mirion TopCo as the “Predecessor” for periods prior to the closing of the Business Combination and Mirion Technologies, Inc. as the “Successor” for periods after the closing of the Business Combination. As a result of the application of the acquisition method of accounting in the Successor Period, the financial statements for the Successor Period are presented on a full step-up basis as a result of the Business Combination, and are therefore not comparable to the financial statements of the Predecessor Period that are not presented on the same full step-up basis due to the Business Combination.


CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Our public communications and SEC filings may contain forward-looking statements within the meaning of the "safe-harbor" provisions of the Private Securities Litigation Reform Act of 1995 that reflect future plans, estimates, beliefs, and expected performance. All statements contained in this Quarterly Report on Form 10-Q other than statements of historical fact, including statements regarding our future operating results and financial position, our business strategy and plans, our objectives for future operations, the Russian invasion of Ukraine, macroeconomic trends, and our competitive positioning are forward-looking statements. This includes, without limitation, statements under “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding our financial position, capital structure, indebtedness, business strategy and the plans and objectives of management for future operations, market share and products sales, future market opportunities, future manufacturing capabilities and facilities, future sales channels and strategies. These statements constitute projections, forecasts and forward-looking statements, and are not guarantees of performance. When used in this Quarterly Report on Form 10-Q, words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “strive,” “seeks,” “plans,” “scheduled,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. When we discuss our strategies or plans we are making projections, forecasts or forward-looking statements. Such statements are based on the beliefs of, as well as assumptions made by and information currently available to, our management.

The forward-looking statements contained in this Quarterly Report on Form 10-Q are based on our current expectations and beliefs concerning future developments and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, the following risks, uncertainties and other factors:

changes in domestic and foreign business, market, economic, financial, political and legal conditions;
risks related to the continued growth of our end markets;
our ability to win new customers and retain existing customers;
our ability to realize sales expected from our backlog of orders and contracts;
risks related to governmental contracts;
our ability to mitigate risks associated with long-term fixed price contracts, including risks related to inflation;
risks related to information technology disruption or security;
risks related to the implementation and enhancement of information systems;
our ability to manage our supply chain or difficulties with third-party manufacturers;
risks related to competition;
our ability to manage disruptions of, or changes in, our independent sales representatives, distributors and original equipment manufacturers;
our ability to realize the expected benefit from any synergies from acquisitions or internal restructuring and improvement efforts;
2

our ability to issue equity or equity-linked securities in the future;
risks related to changes in tax law and ongoing tax audits;
risks related to future legislation and regulation both in the United States and abroad;
risks related to the costs or liabilities associated with product liability claims;
our ability to attract, train and retain key members of our leadership team and other qualified personnel;
risks related to the adequacy of our insurance coverage;
risks related to the global scope of our operations, including operations in international and emerging markets;
risks related to our exposure to fluctuations in foreign currency exchange rates;
our ability to comply with various laws and regulations and the costs associated with legal compliance;
risks related to the outcome of any litigation, government and regulatory proceedings, investigations and inquiries;
risks related to our ability to protect or enforce our proprietary rights on which our business depends or third-party intellectual property infringement claims;
liabilities associated with environmental, health and safety matters;
our ability to predict our future operational results;
risks associated with our limited history of operating as an independent company;
the impact of the global COVID-19 pandemic, including the availability, acceptance and efficacy of vaccinations and laws and regulations with respect to vaccinations, on our projected results of operations, financial performance or other financial metrics, or on any of the foregoing risks; and
other risks and uncertainties described in our Annual Report on Form 10-K for the year ended December 31, 2021 and this Quarterly Report on Form 10-Q, including those under the heading “Risk Factors,” and other documents filed or to be filed with the SEC by us.

There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements.

Forward-looking statements included in this Quarterly Report on Form 10-Q speak only as of the date of this Quarterly Report on Form 10-Q or any earlier date specified for such statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

We intend to announce material information to the public through the Mirion Investor Relations website, available at ir.mirion.com, SEC filings, press releases, public conference calls and public webcasts. We use these channels, as well as social media, to communicate with our investors, customers and the public about our company, our offerings and other issues. It is possible that the information we post on our website or social media could be deemed to be material information. As such, we encourage investors, the media, and others to follow the channels listed above, including the social media channels listed on our investor relations website, and to review the information disclosed through such channels. Any updates to the list of disclosure channels through which we will announce information will be posted on the investor relations website.
3

TABLE OF CONTENTS

Page
PART I - FINANCIAL INFORMATION
PART II - OTHER INFORMATION
4

PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
INDEX TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


as of March 31, 2022 and December 31, 2021
for the three months ended March 31, 2022 and March 31, 2021
for the three months ended March 31, 2022 and March 31, 2021
for the three months ended March 31, 2022 and March 31, 2021
for the three months ended March 31, 2022 and March 31, 2021
5

Mirion Technologies, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(In millions, except share data)
Successor
March 31, 2022December 31,
2021
ASSETS
Current assets:
Cash and cash equivalents$84.2 $84.0 
Restricted cash1.0 0.6 
Accounts receivable, net of allowance for doubtful accounts138.6 157.4 
Costs in excess of billings on uncompleted contracts60.7 56.3 
Inventories123.2 123.6 
Prepaid expenses and other current assets28.8 31.5 
Total current assets436.5 453.4 
Property, plant, and equipment, net125.8 124.0 
Operating ROU assets44.2 45.7 
Goodwill1,652.5 1,662.6 
Intangible assets, net763.5 806.9 
Restricted cash2.0 0.7 
Other assets24.4 24.7 
Total assets$3,048.9 $3,118.0 
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Accounts payable$53.1 $59.4 
Deferred contract revenue72.1 73.0 
Notes payable to third-parties, current5.2 3.9 
Operating lease liability, current9.0 9.3 
Accrued expenses and other current liabilities74.0 75.4 
Total current liabilities213.4 221.0 
Notes payable to third-parties, non-current805.5 806.8 
Warrant liabilities48.2 68.1 
Operating lease liability, non-current39.1 40.6 
Deferred income taxes, non-current149.4 161.0 
Other liabilities36.1 36.5 
Total liabilities1,291.7 1,334.0 
Commitments and contingencies (Note 10)
Stockholders’ equity (deficit):
Class A common stock; $0.0001 par value, 500,000,000 shares authorized; 199,523,392 shares issued and outstanding at March 31, 2022; 199,523,292 shares issued and outstanding at December 31, 2021
  
Class B common stock; $0.0001 par value, 100,000,000 shares authorized; 8,560,540 issued and outstanding at March 31, 2022 and December 31, 2021
  
Additional paid-in capital1,853.4 1,845.5 
Accumulated deficit(149.3)(131.6)
Accumulated other comprehensive loss(34.9)(20.7)
Mirion Technologies, Inc. (Successor) stockholders’ equity (deficit)1,669.2 1,693.2 
Noncontrolling interests88.0 90.8 
Total stockholders’ equity1,757.2 1,784.0 
Total liabilities and stockholders’ equity (deficit)$3,048.9 $3,118.0 

The accompanying notes are an integral part of these condensed consolidated financial statements.
6

Mirion Technologies, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
(In millions, except per share data)
 SuccessorPredecessor
 Three Months Ended March 31, 2022Three Months Ended March 31, 2021
Revenues:
Product$116.9 $126.6 
Service46.3 39.6 
Total revenues163.2 166.2 
Cost of revenues:
Product74.8 82.8 
Service24.0 20.9 
Total cost of revenues98.8 103.7 
Gross profit64.4 62.5 
Operating expenses:
Selling, general and administrative90.9 60.4 
Research and development7.1 11.0 
Total operating expenses98.0 71.4 
(Loss) income from operations(33.6)(8.9)
Other expense (income):
Third party interest expense7.9 10.9 
Related party interest expense (Note 8) 32.2 
Foreign currency loss (gain), net1.5 (4.0)
Change in fair value of warrant liabilities(19.9) 
Other expense (income), net (0.2)
Loss before benefit from income taxes(23.1)(47.8)
Benefit from income taxes(4.1)(7.1)
Net loss(19.0)(40.7)
Loss attributable to noncontrolling interests(1.3) 
Net loss attributable to Mirion Technologies, Inc. (Successor) / Mirion Technologies (TopCo), Ltd. (Predecessor) stockholders$(17.7)$(40.7)
Net loss per common share attributable to Mirion Technologies, Inc. (Successor) / Mirion Technologies (TopCo), Ltd. (Predecessor) stockholders — basic and diluted$(0.10)$(6.18)
Weighted average common shares outstanding — basic and diluted180.774 6.586 
The accompanying notes are an integral part of these condensed consolidated financial statements.
7

Mirion Technologies, Inc.
Condensed Consolidated Statements of Comprehensive Loss
(Unaudited)
(In millions)
SuccessorPredecessor
Three Months Ended March 31, 2022Three Months Ended March 31, 2021
Net loss$(19.0)$(40.7)
Other comprehensive loss, net of tax:
Foreign currency translation, net of tax(15.7)(18.1)
Unrecognized actuarial (loss) gain and prior service benefit, net of tax 0.2 
Other comprehensive (loss) income, net of tax(15.7)(17.9)
Comprehensive loss(34.7)(58.6)
Less: Comprehensive loss attributable to noncontrolling interest(2.8) 
Comprehensive loss attributable to Mirion Technologies, Inc. (Successor) / Mirion Technologies (TopCo), Ltd. (Predecessor) stockholders$(31.9)$(58.6)
The accompanying notes are an integral part of these condensed consolidated financial statements.
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Mirion Technologies, Inc.
Condensed Consolidated Statements of Stockholders’ Equity (Deficit)
(Unaudited)
(In millions, except share amounts)

PredecessorA Ordinary
 Shares
A Ordinary
 Amount
B Ordinary
 Shares
 B Ordinary
 Amount
 Additional
Paid-In
 Capital
 Receivable from
 Employees for
 purchase of
 Common Stock
 Accumulated
 Deficit
 Accumulated Other
 Comprehensive
 Income (Loss)
 Noncontrolling
 Interests
 Total
 Stockholders’
 Deficit
Balance December 31, 20201,483,795 $— 5,353,970 $0.1 $9.6 $(2.4)$(793.4)$50.5 $2.2 $(733.4)
Share-based compensation expense— — — — (0.1)— — — — (0.1)
Receivable from employees— — — — — (0.1)— — — (0.1)
Net loss— — — — — — (40.7)— — (40.7)
Other comprehensive loss— — — — — — — (17.9) (17.9)
Balance March 31, 20211,483,795 $— 5,353,970 $0.1 $9.5 $(2.5)$(834.1)$32.6 $2.2 $(792.2)


SuccessorClass A Common StockClass A Common Stock AmountClass B Common StockClass B Common Stock AmountAdditional Paid-In CapitalAccumulated DeficitAccumulated Other Comprehensive Income (Loss)Noncontrolling InterestsTotal Stockholders’ Deficit
Balance December 31, 2021199,523,292 $— 8,560,540 $— $1,845.5 $(131.6)$(20.7)$90.8 $1,784.0 
Stock-based compensation expense7.8 7.8 
Warrant redemptions100 — 
Stock compensation to directors in lieu of cash compensation— 0.1 0.1 
Net loss(17.7)(1.3)(19.0)
Other comprehensive loss— (14.2)(1.5)(15.7)
Balance March 31, 2022199,523,392 $— 8,560,540 $— $1,853.4 $(149.3)$(34.9)$88.0 $1,757.2 

The accompanying notes are an integral part of these condensed consolidated financial statements.
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Mirion Technologies, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(In millions)
SuccessorPredecessor
 Three Months Ended March 31, 2022Three Months Ended March 31, 2021
OPERATING ACTIVITIES:
Net loss$(19.0)$(40.7)
Adjustments to reconcile net loss to net cash provided by operating activities:
Accrual of in-kind interest on notes payable to related parties 31.5 
Depreciation and amortization expense44.9 23.6 
Stock-based compensation expense7.9 (0.1)
Amortization of debt issuance costs1.0 0.9 
Provision for doubtful accounts(0.2)0.4 
Inventory obsolescence write down0.2 0.3 
Change in deferred income taxes(10.4)(0.7)
Loss (gain) on disposal of property, plant and equipment(0.7)(0.3)
Loss (gain) on foreign currency transactions1.5 (4.0)
Change in fair values of warrant liabilities(19.9) 
Other0.1 1.7 
Changes in operating assets and liabilities:
Accounts receivable17.6 (5.5)
Costs in excess of billings on uncompleted contracts(5.2)(5.3)
Inventories(0.9)2.0 
Prepaid expenses and other current assets1.7 (6.5)
Accounts payable(6.8)15.7 
Accrued expenses and other current liabilities(0.9)(13.8)
Deferred contract revenue(0.3)5.1 
Other assets (0.5)
Other liabilities0.8 7.1 
Net cash provided by operating activities11.410.9
INVESTING ACTIVITIES:
Acquisitions of businesses, net of cash and cash equivalents acquired (15.0)
Purchases of property, plant, and equipment and badges(8.7)(8.0)
Sales of property, plant, and equipment0.8  
Net cash used in investing activities(7.9)(23.0)
FINANCING ACTIVITIES:
Principal repayments(0.4)(7.5)
Other financing(0.2)0.2
Net cash used in financing activities(0.6)(7.3)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash(1.0)(1.6)
Net increase (decrease) in cash, cash equivalents, and restricted cash1.9 (21.0)
Cash, cash equivalents, and restricted cash at beginning of period85.3 108.7 
Cash, cash equivalents, and restricted cash at end of period$87.2 $87.7 
The accompanying notes are an integral part of these condensed consolidated financial statements.
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Mirion Technologies, Inc.
Notes to Condensed Consolidated Financial Statements
(Unaudited)

1. Nature of Business and Summary of Significant Accounting Policies

Nature of Business

Mirion Technologies, Inc. (“Mirion”, the “Company” or "Successor" or "us" and formerly GS Acquisition Holdings Corp II ("GSAH")) is a global provider of radiation detection, measurement, analysis, and monitoring products and services to the medical, nuclear, and defense end markets. We provide products and services through our two operating and reportable segments; (i) Medical and (ii) Industrial. The Medical segment provides radiation oncology quality assurance, delivering patient safety solutions for diagnostic imaging and radiation therapy centers around the world, dosimetry solutions for monitoring the total amount of radiation medical staff members are exposed to over time, radiation therapy quality assurance solutions for calibrating and verifying imaging and treatment accuracy, and radionuclide therapy products for nuclear medicine applications such as shielding, product handling, medical imaging furniture, and rehabilitation products. The Industrial segment provides robust, field ready personal radiation detection and identification equipment for defense applications and radiation detection and analysis tools for power plants, labs, and research applications. Nuclear power plant product offerings are used for the full nuclear power plant lifecycle including core detectors and essential measurement devices for new build, maintenance, decontamination and decommission equipment for monitoring and control during fuel dismantling and remote environmental monitoring.

The Company is headquartered in Atlanta, Georgia and has operations in the United States, Canada, the United Kingdom, France, Germany, Finland, China, Belgium, Netherlands, Estonia, and Japan.

On October 20, 2021 (the “Closing Date”), the Company, consummated its previously announced business combination (the “Business Combination”) pursuant to the certain business combination agreement (the "Business Combination Agreement"). As contemplated by the Business Combination Agreement, the Company became the corporate parent of Mirion Technologies TopCo., Ltd. ("Mirion TopCo"). In order to implement a structure similar to that of an “Up-C,” the Company established a Delaware corporation, Mirion IntermediateCo, Inc. (“IntermediateCo”), as a subsidiary of the Company.

Basis of Presentation and Principles of Consolidation

The accompanying unaudited Condensed Consolidated Financial Statements and Notes to Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for financial statements and pursuant to the accounting and disclosure rules and regulations of the U.S. Securities and Exchange Commission (the "SEC") for interim financial information. The interim Condensed Consolidated Financial Statements reflect all adjustments that are of a normal recurring nature and that are considered necessary for a fair representation of the results for the periods presented and should be read in conjunction with the audited Consolidated Financial Statements and notes thereto for the period ended December 31, 2021, which include a complete set of footnote disclosures, including our significant accounting policies included in our Annual Report on Form 10-K. The results for interim periods are not necessarily indicative of the results that may be expected for a full fiscal year or for any other future period. The Condensed Consolidated Financial Statements include the accounts of the Company and its wholly owned and majority-owned or controlled subsidiaries. For consolidated subsidiaries where our ownership is less than 100%, the portion of the net income or loss allocable to noncontrolling interests is reported as “Income (Loss) attributable to noncontrolling interests” in the Condensed Consolidated Statements of Operations. All intercompany accounts and transactions have been eliminated in consolidation.

The Company recognizes a noncontrolling interest for the portion Class B common stock of IntermediateCo that is not attributable to the Company. See Note 19, Noncontrolling Interests.

On October 20, 2021, the Board of Directors determined to change Mirion TopCo's fiscal year end from June 30th of each year to December 31st of each year in order to align Mirion’s fiscal year end with GSAH’s fiscal year end.

Predecessor and Successor Reporting

The financial statements separate the Company’s presentation into two distinct periods. The period before the Closing Date of the Business Combination (the "Predecessor Period") depicts the financial statements of Mirion TopCo, and the period
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after the Closing (the "Successor Period") depicts the financial statements of the Company, including the consolidation of GSAH with Mirion Technologies, Inc.

The Business Combination was accounted for under ASC 805, Business Combinations. GSAH was determined to be the accounting acquirer. Mirion Technologies, Inc. constitutes a business in accordance with ASC 805 and the business combination constitutes a change in control. Accordingly, the Business Combination is being accounted for using the acquisition method. Under this method of accounting, Mirion TopCo is treated as the “acquired” company for financial reporting purposes and the acquired net assets were stated at fair value, with goodwill or other intangible assets recorded.

As a result of the application of the acquisition method of accounting in the Successor Period, the financial statements for the Successor Period are presented on a full step-up basis as a result of the Business Combination, and are therefore not comparable to the financial statements of the Predecessor Period.

Segments

The Company manages its operations through two operating and reportable segments: Medical and Industrial. These segments align the Company’s products and service offerings with customer use in medical and industrial markets and are consistent with how the Company’s Chief Executive Officer, its Chief Operating Decision Maker (“CODM”), reviews and evaluates the Company’s operations. The CODM allocates resources and evaluates the financial performance of each operating segment. The Company’s segments are strategic businesses that are managed separately because each one develops, manufactures and markets distinct products and services. Refer to Note 15, Segments, for further detail.
Use of Estimates
Management estimates and judgments are an integral part of financial statements prepared in accordance with GAAP. We believe that the critical accounting policies listed below address the more significant estimates required of management when preparing our consolidated financial statements in accordance with GAAP. We consider an accounting estimate critical if changes in the estimate may have a material impact on our financial condition or results of operations. We believe that the accounting estimates employed are appropriate and resulting balances are reasonable; however, actual results could differ from the original estimates, requiring adjustment to these balances in future periods. The accounting policies that reflect our more significant estimates, judgments and assumptions and which we believe are the most critical to aid in fully understanding and evaluating our reported financial results include but are not limited to: business combinations, goodwill and intangible assets; standalone selling prices for revenue arrangements with multiple elements and estimated progress toward completion for certain revenue contracts; uncertain tax positions and tax valuation allowances and derivative warrant liabilities.
Significant Accounting Policies
There have been no material changes in our significant accounting policies during the three months ended March 31, 2022, as compared to the significant accounting policies described in Note 1 to the audited Consolidated Financial Statements on Form 10-K for the period ended December 31, 2021.
Accounts Receivable and Allowance for Doubtful Accounts
The allowance for doubtful accounts is based on the Company’s assessment of the collectability of customer accounts. The allowance for doubtful accounts was $5.1 million and $5.4 million as of March 31, 2022 and December 31, 2021, respectively.
Prepaid Expenses and Other Current Assets
Other current assets are primarily comprised of various prepaid assets including prepaid insurance, short-term marketable securities, and income tax receivables.
The components of other current assets consist of the following (in millions):
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Successor
March 31, 2022December 31, 2021
Prepaid insurance$3.1 $5.3 
Short-term marketable securities4.7 4.9 
Income tax receivable1.0 2.8 
Other current assets20.0 18.5 
$28.8 $31.5 
Facility and Equipment Decommissioning Liabilities
The Company has asset retirement obligations (“ARO”) consisting primarily of equipment and facility decommissioning costs. ARO liabilities totaled $3.0 million and $3.1 million at March 31, 2022 and December 31, 2021, respectively, and were included in deferred income taxes and other liabilities on the Condensed Consolidated Balance Sheets. Accretion expense related to these liabilities was not material for any periods presented.
Revenue Recognition
The Company recognizes revenue from arrangements that include performance obligations to design, engineer, manufacture, deliver, and install products. If a performance obligation does not qualify for over-time revenue recognition, revenue is then recognized at the point-in-time in which control of the distinct good or service is transferred to the customer, typically based upon the terms of delivery.
Revenue derived from passive dosimetry and analytical services is of a subscription nature and is provided to customers on an agreed-upon recurring monthly, quarterly or annual basis. Revenue is recognized ratably over the service period as the service is continuous, and no other discernible pattern of recognition is evident.
Contract Balances
The timing of the Company's revenue recognition, invoicing, and cash collections results in accounts receivable, costs and estimated earnings in excess of billings on uncompleted contracts, and deferred contract revenue. Refer to Note 3, Contracts in Progress for further details.
Remaining Performance Obligations
The remaining performance obligations for all open contracts as of March 31, 2022 include assembly, delivery, installation, and trainings. The aggregate amount of the transaction price allocated to the remaining performance obligations for all open customer contracts was approximately $753.5 million and $747.5 million as of March 31, 2022 and December 31, 2021, respectively. As of March 31, 2022 the Company expects to recognize approximately 41%, 23%, 16%, and 9% of the remaining performance obligations as revenue during the fiscal years 2022, 2023, 2024 and 2025, respectively.
Disaggregation of Revenues
A disaggregation of the Company’s revenues by segment, geographic region, timing of revenue recognition and product category is provided in Note 15, Segment Information.
Warrant Liability

As of March 31, 2022, the Company had outstanding warrants to purchase up to 27,249,879 shares of Class A common stock. The Company accounts for the warrants in accordance with the guidance contained in ASC 815, “Derivatives and Hedging”, under which the warrants do not meet the criteria for equity treatment and must be recorded as derivative liabilities. Accordingly, the Company classifies the warrants as liabilities at their fair value and adjusts the warrants to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until the warrants are exercised or expire, and any change in fair value is recognized in the Company’s Condensed Consolidated Statements of Operations. The fair value of the Public Warrants issued in connection with GSAH's initial public offering has been measured based on the listed market price of such Public Warrants. As the transfer of Private Placement Warrants to anyone who is not a permitted transferee would result in the Private Placement Warrants having substantially the same terms as the Public Warrants, we determined that the fair value of each Private Placement Warrant is equivalent to that of
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each Public Warrant. The determination of the fair value of the warrant liability may be subject to change as more current information becomes available and accordingly the actual results could differ significantly. Derivative warrant liabilities are classified as non-current liabilities as their liquidation is not reasonably expected to require the use of current assets or require the creation of current liabilities. See Note 16, Fair Value Measurements.
Concentrations of Risk
Financial instruments that are potentially subject to concentration of credit risk consist primarily of cash and cash equivalents and accounts receivable. The Company maintains cash in bank deposit accounts that, at times, may exceed the insured limits of the local country. The Company has not experienced any losses in such accounts.
The Company sells its products and services mainly to large, private and governmental organizations in the Americas, Europe, the Middle East and Asia Pacific regions. The Company performs ongoing evaluations of its customers’ financial condition and limits the amount of credit extended when deemed necessary. The Company generally does not require its customers to provide collateral or other security to support accounts receivable. As of March 31, 2022 and December 31, 2021, no customer accounted for more than 10% of the accounts receivable balance.
Recent Accounting Pronouncements
Accounting Guidance Issued But Not Yet Adopted
In March 2020, the FASB issued ASU 2020-04 “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting”. ASU 2020-04 provides temporary optional expedients and exceptions for applying GAAP guidance on contract modifications and hedge accounting to ease the financial reporting burdens of the expected market transition from the LIBOR and other interbank offered rates to alternative reference rates, such as the Secured Overnight Financing Rate. For all entities, ASU 2020-04 can be adopted after its issuance date through December 31, 2022. The Company is currently evaluating the impact of this ASU.
2. Business Combinations and Acquisitions

On October 20, 2021, Mirion Technologies, Inc. consummated its previously announced Business Combination pursuant to the Business Combination Agreement. On December 1, 2021, the Company acquired 100% of the equity interest of CIRS.

No adjustments to the previously disclosed preliminary fair value of net assets acquired in the Business Combination and CIRS acquisition have been recorded in the quarter ended March 31, 2022. The estimated fair values of all assets acquired and liabilities assumed in the acquisitions are provisional and may be revised as a result of additional information obtained during the measurement period of up to one year from the acquisition dates, including but not limited to valuation of tax accounts, property, plant and equipment and intangible assets.
3. Contracts in Progress
Costs and billings on uncompleted construction-type contracts consist of the following (in millions):
Successor
March 31, 2022December 31, 2021
Costs incurred on contracts (from inception to completion)$193.4 $199.4 
Estimated earnings122.5 125.5 
Contracts in progress315.9 324.9 
Less: billings to date(267.3)(281.8)
$48.6 $43.1 
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The carrying amounts related to uncompleted construction-type contracts are included in the accompanying Condensed Consolidated Balance Sheets under the following captions (in millions):
Successor
March 31, 2022December 31, 2021
Costs and estimated earnings in excess of billings on uncompleted contracts – current$60.7 $56.3 
Costs and estimated earnings in excess of billings on uncompleted contracts – non-current (1)
6.3 6.5 
Billings in excess of costs and estimated earnings on uncompleted contracts – current (2)
(16.2)(17.6)
Billings in excess of costs and estimated earnings on uncompleted contracts – non-current (3)
(2.2)(2.1)
$48.6 $43.1 
(1)Included in other assets within the Condensed Consolidated Balance Sheets.
(2)Included in deferred contract revenue – current within the Condensed Consolidated Balance Sheets.
(3)Included in other liabilities within the Condensed Consolidated Balance Sheets.
For the three months ended March 31, 2022 the Company has recognized revenue of $3.3 million related to the contract liabilities balance as of December 31, 2021.
4. Inventories
The components of inventories consist of the following (in millions):
Successor
 March 31, 2022December 31, 2021
Raw materials$59.6 $56.8 
Work in progress29.8 26.6 
Finished goods33.8 40.2 
 $123.2 $123.6 
5. Property, Plant and Equipment, Net
Property, plant and equipment, net consist of the following (in millions):
Successor
 Depreciable
Lives
 March 31, 2022December 31, 2021
Land, buildings, and leasehold improvements
3-39 years
 $45.0 $45.0 
Machinery and equipment
5-15 years
 28.1 26.7 
Badges
3-5 years
 30.0 27.9 
Furniture, fixtures, computer equipment and other
3-10 years
 18.3 16.7 
Construction in progress 15.2 12.2 
   136.6 128.5 
Less: accumulated depreciation and amortization  (10.8)(4.5)
   $125.8 $124.0 
Total depreciation expense included in costs of revenues and operating expenses was as follows (in millions):
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SuccessorPredecessor
March 31, 2022March 31, 2021
Depreciation expense in:
Cost of revenues$4.2 $2.9 
Operating expenses$1.9 $2.1 
Construction in progress includes capitalized internal use software costs totaling $1.9 million and $1.7 million as of March 31, 2022 and December 31, 2021 respectively.
6. Accrued Expenses and Other Current Liabilities
Accrued expenses and other current liabilities consist of the following (in millions):
Successor
 March 31, 2022December 31, 2021
Compensation and related benefit costs$33.1 $34.0 
Customer deposits8.68.8 
Accrued commissions0.90.9 
Accrued warranty costs5.45.9 
Non-income taxes payable6.27.5 
Pension and other post-retirement obligations0.50.3 
Income taxes payable5.33.2 
Restructuring1.11.4 
Accrued professional fees related to becoming a public company0.71.8 
Deferred and contingent consideration 1.62.0
Other accrued expenses10.69.6 
 Total$74.0 $75.4 
7. Goodwill and Intangible Assets
Goodwill
Goodwill is calculated as the excess of consideration transferred over the net assets recognized for acquired businesses and represents future economic benefits arising from the other assets acquired that could not be individually identified and separately recognized. The Company assesses goodwill for impairment at the reporting unit level annually on the first day of the fourth quarter and upon the occurrence of a triggering event or change in circumstance that would more likely than not reduce the fair value of a reporting unit below its carrying amount.
Goodwill is assigned to reporting units at the date the goodwill is initially recorded and is reallocated as necessary based on the composition of reporting units over time. No goodwill impairment was recognized for the three months ended March 31, 2022 and 2021, respectively.
The following table shows changes in the carrying amount of goodwill by reportable segment as of March 31, 2022 and December 31, 2021 (in millions):
Successor
MedicalIndustrialConsolidated
Balance—December 31, 2021$712.5 $950.1 $1,662.6 
Translation adjustment (10.1)(10.1)
Balance—March 31, 2022$712.5 $940.0 $1,652.5 
A portion of the goodwill is deductible for income tax purposes.
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Intangible Assets
Intangible assets consist of our developed technology, customer relationships, backlog, trade names, and non-compete agreements at the time of acquisition through business combinations. The customer relationships definite lived intangible assets are amortized using the double declining balance method while all other definite lived intangible assets are amortized on a straight-line basis over their estimated useful lives.
Many of our intangible assets are not deductible for income tax purposes. A summary of intangible assets useful lives, gross carrying value and related accumulated amortization is below (in millions):
Successor
March 31, 2022
Original Average
 Life in Years
Gross Carrying
 Amount
Accumulated
 Amortization
Net Book
 Value
Customer relationships
6 - 13
$339.5 $(33.2)$306.3 
Distributor relationships
7 - 13
61.0 (3.4)57.6 
Developed technology
 5 - 16
249.2 (13.5)235.7 
Trade names
3 - 10
99.4 (4.6)94.8 
Backlog and other
1 - 4
84.9 (15.8)69.1 
Total$834.0 $(70.5)$763.5 
December 31, 2021
Original Average
 Life in Years
Gross Carrying
 Amount
Accumulated
 Amortization
Net Book
 Value
Customer relationships
6 - 13
$341.0 $(15.3)$325.8 
Distributor relationships
7 - 13
61.0 (1.5)59.5
Developed technology
5 - 16
251.2 (5.9)245.3
Trade names
3 - 10
100.0 (2.1)97.9
Backlog and other
1 - 4
85.7 (7.2)78.4
Total$838.9 $(32.0)$806.9 
Aggregate amortization expense for intangible assets included in cost of revenues and operating expenses was as follows (in millions):
SuccessorPredecessor
Three Months Ended March 31, 2022Three Months Ended March 31, 2021
Amortization expense for intangible assets in:
Cost of revenues$6.7 $6.9 
Operating expenses$32.1 $11.7 
8. Borrowings
On June 17, 2021, Mirion and certain selling shareholders (the "Sellers") entered into the Business Combination Agreement with GSAH, a special purpose acquisition company. On October 20, 2021, Mirion consummated the Business Combination pursuant to the Business Combination Agreement, combining with a subsidiary of GSAH at the Closing, for total consideration of approximately $2.6 billion. The Sellers received cash consideration of approximately $1.3 billion and 30,401,902 shares of Class A and 8,560,540 shares of Class B common stock valued at approximately $0.4 billion on the Closing Date (based upon a $10.45 average price per share of GSAH's Class A common stock on the Closing Date). The Shareholder Notes and Management Notes (each as defined below) were acquired by GSAH at the Closing for a price equal to the full outstanding principal amount together with all accrued but unpaid interest up to but excluding the Closing Date using a portion of the Business Combination Consideration. In connection with the Closing, GSAH contributed the
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Shareholder Notes and the Management Notes to Mirion TopCo, and then the Shareholder Notes and Management Notes were extinguished in full. Borrowings under the 2019 Credit Facility (as defined below) as of the Closing Date were paid in full through the cash consideration and new financing obtained through the 2021 Credit Agreement described below.
Third-party notes payable consist of the following (in millions):
Successor
March 31,
2022
December 31,
2021
2021 Credit Agreement$827.9 $828.3 
Canadian Financial Institution1.2 1.2 
Other1.9 2.3 
Draw on revolving line of credit  
Total third-party borrowings831.0 831.8
Less: notes payable to third-parties, current(5.2)(3.9)
Less: deferred financing costs(20.3)(21.1)
Notes payable to third-parties, non-current$805.5 $806.8 
As of March 31, 2022 and December 31, 2021, the fair market value of the Company's 2021 Credit Agreement was $818.6 million and $825.2 million, respectively. The fair market value for the 2021 Credit Agreement was estimated using primarily level 2 inputs, including borrowing rates available to the Company at the respective period ends. The fair market value for the Company’s remaining third-party debt approximates the respective carrying amounts as of March 31, 2022 and December 31, 2021.
2021 Credit Agreement
In connection with the Business Combination, certain subsidiaries of the Company entered into the 2021 Credit Agreement among Mirion Technologies (HoldingSub2), Ltd., a limited liability company incorporated in England and Wales, as Holdings, Mirion Technologies (US Holdings), Inc., as the Parent Borrower, Mirion Technologies (US), Inc., as the Subsidiary Borrower, the lending institutions party thereto, Citibank, N.A., as the Administrative Agent and Collateral Agent and Goldman Sachs Lending Partners, Citigroup Global Markets Inc., Jefferies Finance LLC and JPMorgan Chase Bank, N.A., as the Joint Lead Arrangers and Bookrunners.
The 2021 Credit Agreement refinanced and replaced the credit agreement from March 2019, by and between, among others, Mirion Technologies (HoldingRep), Ltd. ("Mirion HoldingRep"), its subsidiaries and Morgan Stanley Senior Funding Inc., as administrative agent, certain other revolving lenders and a syndicate of institutional lenders (the “2019 Credit Facility”) which is described in more detail below.
The 2021 Credit Agreement provides for an $830.0 million senior secured first lien term loan facility and a $90.0 million senior secured revolving facility (collectively, the “Credit Facilities”). Funds from the Credit Facilities are permitted to be used in connection with the Business Combination and relation transactions to refinance the 2019 Credit Facility referred to below and for general corporate purposes. The term loan facility is scheduled to mature on October 20, 2028 and the revolving facility is scheduled to expire and mature on October 20, 2026. The agreement requires the payment of a commitment fee of 0.50% per annum for unused revolving commitments, subject to stepdowns to 0.375% per annum and 0.25% per annum upon the achievement of specified leverage ratios. Any outstanding letters of credit issued under the 2021 Credit Agreement reduce the availability under the revolving line of credit.
The 2021 Credit Agreement is secured by a first priority lien on the equity interests of the Parent Borrower owned by Holdings and substantially all of the assets (subject to customary exceptions) of the borrowers and the other guarantors thereunder. Interest with respect to the facilities is based on, at the option of the borrowers, (i) a customary base rate formula for borrowings in U.S. dollars or (ii) a floating rate formula based on LIBOR (with customary fallback provisions) for borrowings in U.S. dollars, a floating rate formula based on EURIBOR for borrowings in Euro or a floating rate formula based on SONIA for borrowings in Pounds Sterling, each as described in the 2021 Credit Agreement with respect to the applicable type of borrowing. The 2021 Credit Agreement includes fallback language that seeks to either facilitate an agreement with the Company's lenders on a replacement rate for LIBOR in the event of its discontinuance or that automatically replaces LIBOR with benchmark rates based upon the Secured Overnight Financing Rate ("SOFR") or other benchmark replacement rates upon certain triggering events.
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The 2021 Credit Agreement contains customary representations and warranties as well as customary affirmative and negative covenants and events of default. The negative covenants include, among others and in each case subject to certain thresholds and exceptions, limitations on incurrence of liens, limitations on incurrence of indebtedness, limitations on making dividends and other distributions, limitations on engaging in asset sales, limitations on making investments, and a financial covenant that the “First Lien Net Leverage Ratio” (as defined in the 2021 Credit Agreement) as of the end of any fiscal quarter is not greater than 7.00 to 1.00 if on the last day of such fiscal quarter certain borrowings outstanding under the revolving credit facility exceed 40% of the total revolving credit commitments at such time. The covenants also contain limitations on the activities of Mirion Technologies (HoldingSub2), Ltd. as the “passive” holding company. If any of the events of default occur and are not cured or waived, any unpaid amounts under the 2021 Credit Agreement may be declared immediately due and payable, the revolving credit commitments may be terminated and remedies against the collateral may be exercised. Mirion Technologies (HoldingSub2), Ltd. and subsidiaries were in compliance with all debt covenants on March 31, 2022 and December 31, 2021.
Term Loan - The term loan has a seven-year term (expiring October 2028), bears interest at the greater of Adjusted London Interbank Offered Rate ("LIBOR") or 0.50%, plus 2.75% and has quarterly principal repayments of 0.25% of the original principal balance. The interest rate was 3.25% as March 31, 2022 and December 31, 2021. The Company repaid $0.4 million and $1.7 million for the 3-month period ended March 31, 2022 and for Successor Period ended December 31, 2021, respectively, yielding an outstanding balance of approximately $827.9 million and $828.3 million as of March 31, 2022 and December 31, 2021, respectively.
Revolving Line of Credit - The revolving line of credit arrangement has a five year term and bears interest at the greater of LIBOR or 0%, plus 2.75%. The agreement requires the payment of a commitment fee of 0.50% per annum for unused commitments. The revolving line of credit matures in October 2026, at which time all outstanding revolving facility loans and accrued and unpaid interest are due. Any outstanding letters of credit reduce the availability of the revolving line of credit. There was no outstanding balance under the arrangement as of March 31, 2022 and December 31, 2021. Additionally, the Company has standby letters of credit issued under its 2021 Credit Agreement that reduce the availability under the revolver of $8.0 million and $8.1 million as March 31, 2022 and December 31, 2021, respectively. The amount available on the revolver as of March 31, 2022 and December 31, 2021 was approximately $82.0 million and $81.9 million, respectively.
Deferred Financing Costs
In connection with the issuance of the 2021 Credit Agreement term loan, we incurred debt issuance costs of $21.7 million on date of issuance. In accordance with accounting for debt issuance costs, we recognize and present deferred finance costs associated with non-revolving debt and financing obligations as a reduction from the face amount of related indebtedness in our Condensed Consolidated Balance Sheets.
In connection with the issuance of the 2021 Credit Agreement revolving line of credit, we incurred debt issuance costs of $1.8 million. We recognize and present debt issuance costs associated with revolving debt arrangements as an asset and include the deferred finance costs within other assets on our Condensed Consolidated Balance Sheets. We amortize all debt issuance costs over the life of the related indebtedness.
For the 3-month period ended March 31, 2022, we incurred approximately $1.0 million of amortization expense of the deferred finance costs.
2019 Credit Facility
In conjunction with the Business Combination, the 2021 Credit Agreement refinanced and replaced the 2019 Credit Facility.
The 2019 Credit Facility provided for financing of a $450.0 million senior secured term loan facility and a €125.0 million term loan facility, as well as a $90.0 million revolving line of credit. The 2019 Credit Facility was amended to provide an additional $225.0 million, $34.0 million and $66.0 million in gross proceeds from the USD term loan in December 2020, July 2019, and December 2019, respectively.
USD term loan – The term loan had a seven-year term (expiring March 2026), bearing interest at the greater of Adjusted London Interbank Offered Rate (“LIBOR”) or 0%, plus 4.00%, and had quarterly principal repayments of 0.25% of the original principal balance. The interest rate was 4.27% as of March 31, 2021. The Company repaid $1.9 million for the 3-month period ended March 31, 2021.

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Euro term loan - The Euro portion of the term loan had a seven-year term (expiring March 2026), bearing interest at the greater of European union interbank market (“Euribor”) or 0%, plus 4.25% and has quarterly principal repayments of 0.25% of the original principal balance. As of March 31, 2021, the interest rate was 4.25%. The Company repaid $0.4 million for the three months ended March 31, 2021.

Revolving Line of Credit - The revolving line of credit arrangement had a five-year term and bearing interest at the greater of LIBOR or 0%, plus 4.00%. The agreement requires the payment of a commitment fee of 0.50% per annum for unused commitments. The revolving line of credit matures in March 2024, at which time all outstanding revolving facility loans and accrued and unpaid interest are due. Any outstanding letters of credit reduce the availability of the revolving line of credit.

Deferred Financing Costs

As noted above, the 2021 Credit Agreement refinanced and replaced the 2019 Credit Facility. In conjunction with the Business Combination purchase accounting we wrote off the remaining unamortized original issue discounts (OID) and debt issuance costs of $15.4 million related to the term loan and $0.4 million related to the revolving line of credit and recorded as a loss on extinguishment of debt on the last day of the Predecessor Period.
For the 3-month period ended March 31, 2021, we incurred approximately $1.0 million of amortization expense of the deferred finance costs.
NRG Loan - In conjunction with the acquisition of NRG, the Company entered into a loan agreement for €7.2 million ($7.4 million) at the date of the acquisition. This agreement was scheduled to expire in December 2023. The loan bore interest which is Euribor of three months, plus 2.0%, and mandatory costs if any. The remaining balance for this loan was paid off in full during the 3-months ended March 31, 2021.
Canadian Financial Institution - In May 2019, the Company entered into a credit agreement for C$1.7 million ($1.3 million) with a Canadian financial institution that matures in April 2039. The note bears annual interest at 4.15%. The credit agreement is secured by the facility acquired using the funds obtained.
Overdraft Facilities
The Company has overdraft facilities with certain German and French financial institutions. As of March 31, 2022 and December 31, 2021 there were no outstanding amounts under these arrangements.

Accounts Receivable Sales Agreement

We are party to an agreement to sell short-term receivables from certain qualified customer trade accounts to an unaffiliated French financial institution without recourse. Under this agreement, the Company can sell up to €8.0 million ($8.9 million) and €8.0 million ($9.1 million) as March 31, 2022 and December 31, 2021, respectively, of eligible accounts receivables. The accounts receivable under this agreement are sold at face value and are excluded from the consolidated balance if revenue has been recognized on the related receivable. When the related revenue has not been recognized on the receivable the Company considers the accounts receivable to be collateral for short-term borrowings. As of March 31, 2022 and December 31, 2021, there was $0.0 million and approximately $0.4 million, respectively, outstanding under these arrangements included as Other in the Borrowings table above.

Total costs associated with this arrangement were immaterial for the Successor Periods and for all Predecessor Periods presented and are included in selling, general and administrative expense in the Condensed Consolidated Statements of Operations.
Performance Bonds and Other Credit Facilities
The Company has entered into various line of credit arrangements with local banks in France and Germany. These arrangements provide for the issuance of documentary and standby letters of credit of up to €67.5 million ($75.0 million) and €70.3 million ($79.7 million), as of March 31, 2022 and December 31, 2021, respectively, subject to certain local restrictions. As of March 31, 2022 and December 31, 2021 there were €43.3 million ($48.1 million) and €37.7 million ($42.7 million), respectively, of the lines had been utilized to guarantee documentary and standby letters of credit, with interest rates ranging from 0.5% to 2.0%. In addition, the Company posts performance bonds with irrevocable letters of credit to support certain contractual obligations to customers for equipment delivery. These letters of credit are supported by restricted cash accounts, which totaled $3.0 million and $1.3 million as of March 31, 2022 and December 31, 2021, respectively.
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At March 31, 2022, contractual principal payments of total third-party borrowings are as follows (in millions):
Fiscal year ending March 31: 
Remainder of 2022$6.3 
20238.4 
20248.3 
20258.2 
20269.6 
Thereafter790.2 
Gross Payments831.0 
Unamortized debt issuance costs(20.3)
Total third-party borrowings, net of debt issuance costs$810.7 
Notes Payable to Related Parties
Concurrent with the Closing, a portion of the Business Combination Consideration was used to extinguish the Shareholder Notes and the Management Notes in full.
Shareholder and Management Notes – Mirion Technologies (HoldingSub1), Ltd., was authorized to issue $900.0 million (plus accrued paid in-kind (PIK) interest) of notes to shareholders (the “Shareholder Notes”) and up to $5.0 million (plus paid in-kind (PIK) cash and interest) of notes to certain members of management (the “Management Notes”). The notes ranked pari passu between each other and other unsecured obligations of the Company. The notes could be prepaid without penalty at the Company’s option and were subordinate in right of payment to any indebtedness of the Company to banks or to other financial institutions (either currently existing or to occur in the future). Certain of the Shareholder and Management Notes were admitted to trading and were on the official listing of The International Stock Exchange (TISE).
During 3-month period ended March 31, 2021, no additional Shareholder Notes were admitted to trading and were on the official listing of TISE. There was no trading activity related to Shareholder and Management Notes during 3-month period ended March, 2021.
The notes bore simple annual interest at 11.5%. For the Shareholder Notes, the interest was added to the principal outstanding on December 31 of each year until extinguished and were referred to as Shareholder Funding Bonds on TISE. For the Management Notes, half of the interest was added to the principal outstanding on December 31 of each year until extinguished and was referred to as Management Funding Bonds on TISE, while the remaining half was payable in cash annually. The listing on the TISE for Shareholder and Management Funding Bonds was an optional election and certain shareholders had elected to opt-out of listing their Shareholder Funding Bonds. All other shareholders and management had elected to list their funding bonds on TISE. The notes were due when the Company completes a public offering, a winding-up, a sale, or on March 30, 2026, whichever occurred first. The redemption price was equal to the outstanding principal plus all accrued and unpaid interest then outstanding.

9. Leased Assets

The Company primarily leases certain logistics, office, and manufacturing facilities, as well as vehicles, copiers and other equipment. These operating leases generally have remaining lease terms between 1 month and 30 years, and some include options to extend (generally 1 to 10 years). The exercise of lease renewal options is at the Company’s discretion. The Company evaluates renewal options at lease inception and on an ongoing basis, and includes renewal options that it is reasonably certain to exercise in its expected lease terms when classifying leases and measuring lease liabilities. Lease agreements generally do not require material variable lease payments, residual value guarantees or restrictive covenants.

The table below presents the locations of the operating lease assets and liabilities on the Condensed Consolidated Balance Sheets as of March 31, 2022 and December 31, 2021, respectively (in millions):

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Successor
Balance Sheet Line ItemMarch 31, 2022December 31, 2021
Operating Lease assetsOperating Lease assets$44.2 $45.7 
Financing Lease assetsOther Assets$0.8 $0.9 
Operating lease liabilities:
       Current operating lease liabilitiesCurrent operating lease liabilities$9.0 $9.3 
       Non-current operating lease liabilitiesOperating lease liability, non-current39.1 40.6 
Total operating lease liabilities:$48.1 $49.9 
Financing lease liabilities:
       Current financing lease liabilitiesAccrued expenses and other current liabilities$0.6 $0.6 
       Non-current financing lease liabilitiesDeferred income taxes and other long-term liabilities0.2 0.3 
Total financing lease liabilities:$0.8 $0.9 

The depreciable lives are limited by the expected lease term for operating lease assets and by shorter of either the expected lease term or economic useful life for financing lease assets.

The Company’s leases generally do not provide an implicit rate, and therefore the Company uses its incremental borrowing rate as the discount rate when measuring the lease liabilities. The incremental borrowing rate represents an estimate of the interest rate the Company would incur at lease commencement to borrow an amount equal to the lease payments on a collateralized basis over the term of the lease within a particular currency environment. The Company used incremental borrowing rates as of July 1, 2021 for leases that commenced prior to that date.

The Company’s weighted average remaining lease term and weighted average discount rate for operating leases as of March 31, 2022 and December 31, 2021, respectively, are:
Successor
March 31, 2022December 31, 2021
Operating leases
       Weighted average remaining lease term (in years) 7.37.5
       Weighted average discount rate4.18 %4.19 %

The table below reconciles the undiscounted future minimum lease payments (displayed by year and in the aggregate) under non-cancelable operating leases with terms of more than one year to the total lease liabilities recognized on the Condensed Consolidated Balance Sheets as of March 31, 2022 (in millions):

Fiscal year ending December 31:
2022$8.2 
20239.6 
20248.0 
20256.5 
20264.9 
       2027 and thereafter18.7 
Total undiscounted future minimum lease payments$55.9 
       Less: Imputed interest(7.8)
Total lease liabilities$48.1 

For the three months ended March 31, 2022, operating lease costs (as defined under ASU 2016-02) were $2.6 million. Operating lease costs are included within costs of goods sold, selling, general and administrative, and research and development expenses on the consolidated statements of income and comprehensive income. Short-term lease costs, variable lease costs and sublease income were not material for the periods presented.

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Rental expense for operating lease (as defined prior to the adoption of ASC 2016-02) was approximately $2.8 million for the Predecessor period three months ended March 31, 2021.

Cash paid for amounts included in the measurement of operating lease liabilities was $2.9 million for the three months ended March 31, 2022 and this amount is included in operating activities in the Condensed Consolidated Statements of Cash Flows. Operating lease assets obtained in exchange for new operating lease liabilities were $0.9 million for the three months ended March 31, 2022.
10. Commitments and Contingencies
Unconditional Purchase Obligations
The Company has entered into certain long-term unconditional purchase obligations with suppliers. These agreements are non-cancellable and specify terms, including fixed or minimum quantities to be purchased, fixed or variable price provisions, and the approximate timing of payment. As of March 31, 2022, unconditional purchase obligations were as follows (in millions):
Fiscal year ending December 31:
2022$19.8 
20237.8 
20244.7 
20252.8 
20262.7 
2027 and thereafter0.3 
Total$38.1 
Litigation
The Company is subject to various legal proceedings, claims, litigation, investigations and contingencies arising out of the ordinary course of business. While the ultimate results of such suits or other proceedings against the Company cannot be predicted with certainty, we believe the resolution of these matters will not have a material effect on our results of operations, financial condition, or cash flows. If we believe the likelihood of an adverse legal outcome is probable and the amount is reasonably estimable, we accrue a liability in accordance with accounting guidance for contingencies. We consult with legal counsel on matters related to litigation and seek input both within and outside the Company.
11. Income Taxes
The effective income tax rate was 17.7% for the three months ended March 31, 2022 (Successor Period) and 14.9% for the three months ended March 31, 2021 (Predecessor Period). The difference in effective tax rate was primarily attributable to mix of earnings, certain adjustments for the Successor Period as a result of the Business Combination, and valuation allowances in the Predecessor Period.
The effective income tax rate for the Successor Period differs from the U.S. statutory rate of 21% due primarily to U.S. federal permanent differences. The effective income tax rate for the Predecessor Period differs from the U.K. statutory rate of 19% due primarily to valuation allowances on certain UK losses.
12. Supplemental Disclosures to Condensed Consolidated Statements of Cash Flows
Supplemental cash flow information and schedules of non-cash investing and financing activities (in millions):
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Successor
Three Months Ended March 31, 2022Three Months Ended March 31. 2021
Cash Paid For:
Cash paid for interest$6.9 $