INTERNATIONAL PAPER CO /NEW/

There have been no material changes from the risk factors disclosed in our Annual Report on Form 10-K (Part I, Item 1A) for the period ended December 31, 2024 and in our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2025, and June 30, 2025 (Part II, Item 1A), other than as described below.

The divestiture of our Global Cellulose Fibers business may be delayed or fail to occur for a variety of reasons, including the failure by the parties to satisfy or waive various closing conditions such as governmental and regulatory approvals. There can be no assurance as to whether or when the transaction may be completed. Failure to consummate the transaction could adversely affect our business, results of operations, financial condition, and the market price of our shares.

On August 21, 2025, the Company announced it had entered into a Securities Purchase Agreement (the “Sale Agreement”) with American Industrial Partners (“AIP”), pursuant to which, among other things, the Company will sell to AIP all of the issued and outstanding equity interests of its Global Cellulose Fibers business. Pursuant to the Sale Agreement, AIP will acquire the Company’s Global Cellulose Fibers business for a purchase price of $1.5 billion, which is subject to certain closing adjustments, and includes the issuance by AIP to the Company of preferred stock of AIP with an aggregate initial liquidation preference of $190 million. We may not realize all or a portion of the value of the preferred stock in the near term or at all.

Our ability to consummate the transaction is dependent on a number of factors that are beyond our control, such as receipt of required governmental and regulatory approvals and satisfaction of other closing conditions. As a result, there can be no assurance that the closing of the transaction will not be delayed or fail to occur. In addition, there can be no assurance that the transaction will have a positive effect on shareholder value. For example, the divestiture of our Global Cellulose Fibers business has resulted in an asset impairment charge of approximately $1.0 billion.

The divestiture of our Global Cellulose Fibers business could cause the diversion of management’s attention, interfere with our ability to retain or attract key personnel, disrupt our business, adversely impact important business relationships, adversely impact our financial results, or expose us to litigation.

In addition, we have and will continue to incur significant costs and expenses in connection with the transaction. Speculation and perceived uncertainties regarding any developments related to the transaction could cause the market price of our common stock to fluctuate significantly or to decline. Failure to complete the transaction within the expected timeframe or at all could adversely affect our business, results of operations, financial condition, and the market price of our common stock.