The combined financial statements have been prepared on a standalone basis and are derived from the consolidated financial statements and accounting records of L Brands. The following discussion summarizes activity between the Company and L Brands.

For purposes of preparing these combined financial statements on a "carve-out" basis, we have allocated a portion of L Brands' total corporate expenses to the Company. See Note 1 for a discussion of the methodology used to allocate corporate-related costs for purposes of preparing these financial statements on a "carve-out" basis.

Balances between the Company and L Brands, Inc. or its affiliates that are derived from transactions that have been historically cash settled are reflected in the Combined Balance Sheets as Due from and Due to Related Parties. Balances between the Company and L Brands, Inc. or its affiliates derived from transactions that have been historically settled other than in cash are included in Net Investment by L Brands, Inc. within Equity on the Combined Balance Sheets.

During 2020, the Company borrowed $97 million from L Brands to pay down outstanding debt with external parties. This borrowing is due in September 2025 and has a variable interest rate based on the China Loan Prime Rate, which was 3.85% as of July 31, 2021. The Company recognized $2 million of interest expense year-to-date 2021 related to this borrowing. Subsequent to July 31, 2021, the Company no longer has this Long-term Debt due to Related Party as a result of the Separation.

The following table presents the components of Net Transfers from (to) L Brands, Inc. in the second quarter and year-to-date 2021 and 2020 Combined Statements of Equity:


	Second Quarter				Year-to-Date
	2021		2020		2021		2020
	(in millions)
Cash Pooling and General Financing Activities, Net	$	(322)	$	(171)	$	(431)	$	102
Long-lived Assets (a)	(4)		—		16		—
Corporate Expense Allocations	30		25		49		45
Share-based Compensation Expense	8		7		15		16
Assumed Income Tax Payments	$	13	$	2	15		8
Total Net Transfers from (to) L Brands, Inc.	$	(275)	$	(137)	$	(336)	$	171

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(a)Represents long-lived assets transferred between the Company and L Brands, Inc. as a result of asset allocation decisions made during the period.

As of July 31, 2021, the L Brands' asset-backed revolving credit facility ("L Brands ABL Facility") had aggregate commitments at $1 billion and no borrowings outstanding. Certain of the Company's subsidiaries, along with other wholly-owned subsidiaries of L Brands, Inc., guaranteed and pledged collateral to secure the L Brands ABL Facility. On August 2, 2021, L Brands amended the facility which, among other things, released the Company's subsidiaries as guarantors thereunder.

Certain of the Company's subsidiaries, along with other wholly-owned subsidiaries of L Brands, Inc., also guaranteed L Brands' obligations under certain of L Brands' long-term notes. The guarantees were full and unconditional on a joint and several basis. The Company's guarantees of obligations under L Brands' long-term notes terminated concurrently with the Separation.

The following table provides the outstanding principal balance for these notes as of July 31, 2021:


	(in millions)
5.625% Fixed Interest Rate Notes due October 2023	$	320
9.375% Fixed Interest Rate Notes due July 2025	500
6.694% Fixed Interest Rate Notes due January 2027	297
5.25% Fixed Interest Rate Notes due February 2028	500
7.50% Fixed Interest Rate Notes due June 2029	500
6.625% Fixed Interest Rate Notes due October 2030	1,000
6.875% Fixed Interest Rate Notes due November 2035	1,000
6.75% Fixed Interest Rate Notes due July 2036	700
Total	$	4,817