Celanese Corp

7. Debt

(1)The weighted average interest rate was 2.2% and 2.2% as of September 30, 2026 and December 31, 2025, respectively.

(2)The weighted average interest rate was 0.0% and 3.1% as of September 30, 2026 and December 31, 2025, respectively.

(1)In February 2025, Moody's Ratings downgraded the Company's credit rating, which had the effect of increasing interest rates by 25 basis points on certain senior unsecured notes, effective on various dates beginning May 15, 2025 through January 19, 2026.

In November 2025, S&P Global Ratings and Moody's Ratings downgraded the Company's credit rating, which together had the effect of increasing interest rates for certain senior unsecured notes by an additional 50 basis points, effective on various dates beginning January 15, 2026 through May 15, 2026.

(2)Interest rates range from 4.1% to 4.3%.

(3)The weighted average interest rate was 2.4% and 2.4% as of September 30, 2026 and December 31, 2025, respectively.

(4)Related to the Company's long-term debt, excluding obligations under finance leases.

Senior Credit Facilities

In March 2022, Celanese U.S. entered into a $1.0 billion senior unsecured term loan credit agreement (as amended to date, the "March 2022 U.S. Term Loan Credit Facility") and in November 2024, Celanese U.S. entered into a $1.0 billion senior unsecured term loan credit agreement (the "November 2024 U.S. Term Loan Credit Facility"). The March 2022 U.S. Term Loan Credit Facility and the November 2024 U.S. Term Loan Facility were each fully repaid and terminated as of December 31, 2025.

In August 2025, Celanese U.S. entered into a new senior unsecured revolving credit agreement (the "U.S. Revolving Credit Facility" and together with the March 2022 U.S. Term Loan Credit Facility and the November 2024 U.S. Term Loan Credit Facility, the "U.S. Credit Facilities"), consisting of a $1.75 billion senior unsecured revolving credit facility (with a letter of credit sublimit), maturing in 2030. The margin for borrowings under the U.S. Revolving Credit Facility is 1.00% to 2.00% (or between 0.00% and 1.00% in the case of U.S. dollar base rate borrowings) above certain interbank rates at current Company credit ratings.

The U.S. Revolving Credit Facility is guaranteed by Celanese and certain domestic subsidiaries, together representing substantially all of the Company's U.S. assets and business operations (the "Subsidiary Guarantors").

Certain of the Company's subsidiaries in China (Celanese (Shanghai) International Trading Co., Ltd ("CSIT") and Celanese (Nanjing) Chemical Co., Ltd. ("CNCC") have outstanding senior unsecured bank obligations (collectively, the "China Credit Facilities") as follows:

(1)Revolving credit facility guaranteed by Celanese U.S. (the "CSIT Revolving Credit Facility"), which bears interest at a fixed rate. The CSIT Revolving Credit Facility was fully repaid on January 13, 2026.

(2)Senior unsecured working capital loan bearing interest at certain floating interest rates.

(3)Senior unsecured working capital loan bearing interest at a fixed interest rate.

(4)Senior unsecured term loan credit agreement bearing interest at certain floating interest rates.

In April 2025, CNCC entered into a CNY 100 million revolving credit facility guaranteed by Celanese U.S. (the "CNCC Revolving Credit Facility" and together with the CSIT Revolving Credit Facility, the "China Revolving Credit Facilities") expiring 12 months from the drawdown date. No draws were initiated as of September 30, 2026.

On September 16, 2026, CNCC entered into a CNY 1.0 billion working capital loan expiring three years from the drawdown date. No draws were initiated as of September 30, 2026.

The Company expects the China Credit Facilities will continue to facilitate its efficient repatriation of cash to the U.S. to repay debt and effectively redomicile a portion of its U.S. debt to China at a lower average interest rate.

The Company's debt balances and amounts available for borrowing under its senior unsecured revolving credit facilities are as follows:

Senior Notes

The Company has outstanding senior unsecured notes, issued in public offerings registered under the Securities Act of 1933, as amended (the "Securities Act") (collectively, the "Senior Notes"). The Senior Notes were issued by Celanese U.S. and are guaranteed on a senior unsecured basis by Celanese and the Subsidiary Guarantors. Celanese U.S. may redeem some or all of each of the Senior Notes, prior to their respective maturity dates, at a redemption price of 100% of the principal amount, plus a "make-whole" premium as specified in the applicable indenture, plus accrued and unpaid interest, if any, to the redemption date.

In March 2025, Celanese U.S. completed a public offering of senior unsecured notes registered under the Securities Act in aggregate principal amounts of €750 million and $1.8 billion (the "March 2025 Offering").

In addition, in March 2025, Celanese U.S. completed cash tender offers for €552 million and $500 million in aggregate principal amounts of senior unsecured notes (the "March 2025 Tender Offers"). The net proceeds from the March 2025 Offering, together with borrowings under the November 2024 U.S. Term Loan Credit Facility, were used (i) to fund the March 2025 Tender Offers, (ii) for repayment of other outstanding indebtedness and (iii) to pay related fees and expenses.

Deferred financing costs related to the March 2025 Offering were $34 million and are being amortized to Interest expense in the unaudited interim consolidated statements of operations over the terms of the applicable notes. Fees and expenses related to the March 2025 Tender Offers of $32 million, including accelerated amortization of deferred financing costs associated with the principal amounts tendered, are included in Refinancing expense in the unaudited interim consolidated statements of operations for the nine months ended September 30, 2025.

In December 2025, Celanese U.S. completed a public offering of senior unsecured notes registered under the Securities Act in an aggregate principal amount of $1.4 billion (the "December 2025 Offering").

In addition, in December 2025, Celanese U.S. completed cash tender offers for $1.2 billion in aggregate principal amounts of senior unsecured notes (the "December 2025 Tender Offers"). The net proceeds from the December 2025 Offering were used to (i) fund the December 2025 Tender Offers, (ii) repay other outstanding indebtedness and (iii) pay related fees and expenses.

On June 25, 2026, Celanese U.S. redeemed all of its outstanding 4.777% unsecured senior notes due 2026 ("4.777% Notes") at a redemption price of 100% of the face amount for a total principal payment of $508 million plus accrued interest of $25 million. Cash on hand was used to fund the redemption.

On August 5, 2026, Celanese U.S. repaid in full all of its outstanding 1.400% unsecured senior notes due on August 5, 2026 ("1.400% Notes") for a total principal payment of $400 million plus accrued interest of $3 million. Cash on hand was used to fund the repayment.

Accounts Receivable Purchasing Facilities

On May 22, 2026, the Company entered into an amendment to the amended and restated receivables purchase agreement (as so amended, the "U.S. Receivables Purchase Agreement") for its U.S. accounts receivable purchasing facility ("U.S. Receivables Purchase Facility") among certain of the Company's subsidiaries, a wholly-owned, "bankruptcy remote" special purpose subsidiary (the "U.S. SPE") and certain global financial institutions ("U.S. Purchasers"). The U.S. Receivables Purchase Agreement extends the term of the U.S. Receivables Purchase Facility such that the U.S. SPE may sell certain receivables until May 22, 2028. Under the U.S. Receivables Purchase Agreement, transfers of accounts receivable from the U.S. SPE are treated as sales and are accounted for as a reduction in accounts receivable because the agreement transfers effective control over and risk related to the accounts receivable to the U.S. SPE. The Company and related subsidiaries have no continuing involvement in the transferred accounts receivable, other than collection and administrative responsibilities, and once sold, such accounts receivable are no longer available to satisfy creditors of the Company or the related subsidiaries. These sales are transacted at 100% of the face value of the relevant accounts receivable, resulting in derecognition of such accounts receivable from the Company's unaudited consolidated balance sheets.

On July 31, 2026, the Company entered into a receivables purchase and financing agreement (the "European Receivables Purchase and Financing Agreement") and established an accounts receivable purchasing and financing facility (the "European Receivables Purchase and Financing Facility") among certain of the Company's European subsidiaries, a wholly-owned, "bankruptcy remote" special purpose subsidiary (the "EU SPE") and certain global financial institutions ("EU Purchasers"). The European Receivables Purchase and Financing Agreement permits the EU SPE to either sell or borrow against certain receivables until July 31, 2028. Under the European Receivables Purchase and Financing Agreement, transfers of accounts receivable from the EU SPE are treated as sales and are accounted for as a reduction in accounts receivable because the agreement transfers effective control over and risk related to such accounts receivable to the EU SPE. Borrowings against the receivables are not treated as sales and, as a result, are retained on the Company's unaudited consolidated balance sheets. The Company and related subsidiaries have no continuing involvement in the transferred accounts receivable, other than collection and administrative responsibilities, and once sold, such accounts receivable are no longer available to satisfy creditors of the Company or the related subsidiaries. The sales are transacted at 100% of the face value of the relevant accounts receivable, resulting in derecognition of such accounts receivable from the Company's unaudited consolidated balance sheets.

The Company's activity under the accounts receivable purchasing facilities is as follows:

(1)Unsold U.S. accounts receivable of $104 million were pledged by the U.S. SPE as collateral to the U.S. Purchasers as of September 30, 2026.

(2)Unsold EU accounts receivable of $267 million were pledged by the EU SPE as collateral to the EU Purchasers as of September 30, 2026.

Factoring and Discounting Agreements

The Company has factoring agreements in Japan and Singapore with financial institutions to sell 100% and 90% of certain accounts receivable, respectively, on a non-recourse basis. The Company also has a factoring agreement in China with a financial institution to sell 100% of certain accounts receivable on a limited recourse basis. On August 4, 2026, the Company proceeded to terminate its European factoring agreement. These transactions are treated as sales and are accounted for as reductions in accounts receivable because the agreements transfer effective control over and risk related to the receivables to the buyer. The Company has no material continuing involvement in the transferred receivables, other than collection and administrative responsibilities and, once sold, the accounts receivable are no longer available to satisfy creditors in the event of bankruptcy. The Company de-recognized $529 million and $717 million of accounts receivable under these factoring agreements for the nine months ended September 30, 2026 and year ended December 31, 2025, respectively, and collected $589 million and $724 million of accounts receivable sold under these factoring agreements during the same periods.

The Company has master discounting agreements (the "Master Discounting Agreements") with financial institutions in China to discount, on a non-recourse basis, banker's acceptance drafts ("BADs"), classified as accounts receivable. Under the Master Discounting Agreements, transfers of BADs are treated as sales and are accounted for as a reduction in accounts receivable because the Master Discounting Agreements transfer effective control over and risk related to the transferred BADs to the financial institutions. The Company has no continuing involvement in the transferred BADs, and the BADs are no longer available to satisfy creditors in the event of a bankruptcy. The Company received $65 million and $82 million from the accounts receivable transferred under the Master Discounting Agreements for the nine months ended September 30, 2026 and year ended December 31, 2025, respectively.

Covenants

The Company's material financing arrangements contain customary covenants, including the maintenance of certain financial ratios, events of default and change of control provisions. Failure to comply with these covenants, or the occurrence of any other event of default, could result in acceleration of the borrowings and other financial obligations.

On July 31, 2026, and during the year ended December 31, 2025, the Company amended certain covenants in certain U.S. Credit Facilities, including financial ratio maintenance covenants.

The Company is in compliance with the covenants in its material financing arrangements as of September 30, 2026. The Company expects to remain in compliance with such covenants over the twelve-month required evaluation period subsequent to the date of this filing based on current market conditions and the Company's current expectation of future results of operations and cash generation. However, should the Company's actual future results of operations and cash generation differ materially from its expectations, it may be required to seek an amendment to or waiver of any impacted covenants, or pursue other mitigation strategies.

8. Benefit Obligations

The components of net periodic benefit cost are as follows:

Benefit obligation funding is as follows:

The Company's estimates of its U.S. defined benefit pension plan contributions reflect the provisions of the Pension Protection Act of 2006.

Pension and postretirement benefit plan balances recognized in the unaudited consolidated balance sheets consist of the following:

9. Environmental

The Company is subject to environmental laws and regulations worldwide that impose limitations on the discharge of pollutants into the air and water, establish standards for the treatment, storage and disposal of solid and hazardous wastes, and impose record keeping and notification requirements. Failure to timely comply with these laws and regulations may expose the Company to penalties. The Company believes that it is in substantial compliance with all applicable environmental laws and regulations and engages in an ongoing process of updating its controls to mitigate compliance risks. The Company is also subject to retained environmental obligations specified in various contractual agreements arising from the divestiture of certain businesses by the Company or one of its predecessor companies.

The components of environmental remediation liabilities, included incurrent and noncurrent Other liabilities, are as follows:

Remediation

Due to its industrial history and through retained contractual and legal obligations, the Company has the obligation to remediate specific areas on its own sites as well as on divested, demerger, orphan or U.S. Superfund sites (defined below). In addition, as part of the demerger agreement between the Company and Hoechst AG ("Hoechst"), a specified portion of the responsibility for environmental liabilities from a number of Hoechst divestitures was transferred to the Company (Note 14). Certain of these sites, at which the Company maintains continuing involvement, were and continue to be designated as discontinued operations when closed. The Company provides for such obligations when the event of loss is probable and reasonably estimable. The Company believes that environmental remediation costs will not have a material adverse effect on the financial position of the Company, but may have a material adverse effect on the results of operations or cash flows in any given period.

U.S. Superfund Sites

In the U.S., the Company may be subject to substantial claims brought by U.S. federal or state regulatory agencies or private individuals pursuant to statutory authority or common law. In particular, the Company has a potential liability under the U.S. Federal Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, and related state laws (collectively referred to as "Superfund") for investigation and cleanup costs at certain sites. At most of these sites, numerous companies, including the Company, or one of its predecessor companies, have been notified that the U.S. Environmental Protection Agency ("EPA"), state governing bodies or private individuals consider such companies to be potentially responsible parties ("PRP") under Superfund or related laws. The proceedings relating to these sites are in various stages. The cleanup process has not been completed at most sites, and the status of the insurance coverage for some of these proceedings is uncertain. Consequently, the Company cannot accurately determine its ultimate liability for investigation or cleanup costs at these sites.

As events progress at each site for which it has been named a PRP, the Company accrues any probable and reasonably estimable liabilities. In establishing these liabilities, the Company considers the contaminants of concern, the potential impact thereof, the relationship of the contaminants of concern to its current and historic operations, its shipment of waste to a site, its percentage of total waste shipped to the site, the types of wastes involved, the conclusions of any studies, the magnitude of any remedial actions that may be necessary and the number and viability of other PRPs. Often the Company joins with other PRPs to sign joint defense agreements that settle, among PRPs, each party's percentage allocation of costs at the site. Although the ultimate liability may differ from the estimate, the Company routinely reviews the liabilities and revises the estimate, as appropriate, based on the most current information available.

One such site is the Diamond Alkali Superfund Site, which is comprised of a number of sub-sites, including the Lower Passaic River Study Area ("LPRSA"), which is the lower 17-mile stretch of the Passaic River ("Lower Passaic River Site"), and the Newark Bay Study Area. The Company and approximately 70 other companies are parties to a May 2007 Administrative Order on Consent with the EPA to perform a Remedial Investigation/Feasibility Study ("RI/FS") at the Lower Passaic River Site in order to identify the levels of contaminants and potential cleanup actions, including the potential migration of contaminants between the LPRSA and the Newark Bay Study Area.

In March 2016, the EPA issued its final Record of Decision concerning the remediation of the lower 8.3 miles of the Lower Passaic River Site ("Lower 8.3 Miles"). Pursuant to the EPA's Record of Decision, the Lower 8.3 Miles must be dredged bank to bank and an engineered cap must be installed at an EPA estimated cost of approximately $1.4 billion. In September 2021, the EPA issued a Record of Decision selecting an interim remedial plan for the upper 9 miles of the Lower Passaic River ("Upper 9 Miles"). Pursuant to the EPA's Record of Decision, targeted dredging will be conducted in the Upper 9 Miles to address surface sediments with elevated contamination followed by the installation of an engineered cap at an EPA estimated cost of $441 million.

The Company owned and/or operated facilities in the vicinity of the Lower 8.3 Miles, but has found no evidence that it contributed any of the contaminants of concern to the Passaic River. In June 2018, Occidental Chemical Corporation ("OCC"), the successor to the Diamond Alkali Company, sued a subsidiary of the Company and 119 other parties alleging claims for joint and several liability, contribution and declaratory relief under Section 107 and 113 of Superfund for costs to clean up the LPRSA portion of the Diamond Alkali Superfund Site, Occidental Chemical Corporation v. 21st Century Fox America, Inc., et al, No. 2:18-CV-11273 (MCA) (LDW) (U.S. District Court New Jersey) (the "2018 OCC Lawsuit"), alleging that each of the defendants owned or operated a facility that contributed contamination to the LPRSA. With respect to the Company, the 2018 OCC lawsuit is limited to the former Celanese facility that Essex County, New Jersey has agreed to indemnify the Company for and does not change the Company's estimated liability for LPRSA cleanup costs.

Separately, the United States lodged a consent decree in U.S. District Court for the District of New Jersey in December 2022 (the "Consent Decree") that resolves the Company's liability (and that of more than 80 other settling defendants) to the EPA for costs to clean up both the Lower 8.3 Miles and Upper 9 Miles of the Lower Passaic River Site in exchange for a collective payment of $150 million, United States v. Alden Leeds, Inc., No. 2:22-7326 (MCA) (LDW) (U.S. District Court New Jersey) ("Consent Decree Action"). The Consent Decree also provides the Company protection from contribution claims by others for costs incurred to clean up both the Lower 8.3 Miles and Upper 9 Miles of the Lower Passaic River Site. The Company's proposed payment toward the $150 million collective settlement payment is not material to the Company's results of operations, cash flows or financial position.

In March 2023, the U.S. District Court for the District of New Jersey entered an order staying and administratively terminating the 2018 OCC Lawsuit, pending resolution of the request for judicial approval of the Consent Decree in the Consent Decree Action. Also, in March 2023, OCC filed a new lawsuit against 40 parties, including a subsidiary of the Company, seeking to recover costs for remedial design work the EPA has ordered OCC to undertake for a portion of the LPRSA at an estimated cost of $93 million, Occidental Chemical Corporation v. Givaudan Fragrances Corporation, No. 2:23-cv-1699 (U.S. District Court New Jersey) (the "2023 OCC Lawsuit"). Like the earlier lawsuit, the 2023 OCC Lawsuit concerns the facility Essex County, New Jersey purchased and for which Essex County, New Jersey has agreed to defend and indemnify the Company. This new lawsuit does not change the Company's estimated liability for LPRSA cleanup costs.

Like the earlier lawsuit, the 2023 OCC lawsuit also was stayed pending resolution of the request for judicial approval of the Consent Decree in the Consent Decree Action. On December 18, 2024, the U.S. District Court for the District of New Jersey granted the United States' motion to enter the Consent Decree in the Consent Decree Action. OCC and Nokia of America Corporation have appealed the District Court's decision entering the Consent Decree to the U.S. Court of Appeals for the Third Circuit. The briefing on appeal has been completed. No oral argument date has been set.

In the interim, the Company continues to vigorously defend these matters and continues to believe that its ultimate allocable share of the cleanup costs with respect to the Lower Passaic River Site, previously estimated at less than 1%, will not be material.

Other Environmental Matters

In April 2022, a methanol leak on a pipeline to the Company's Bishop, Texas facility was discovered. The release has been contained, the leak has been repaired and the pipeline has resumed operation. The Company promptly disclosed the incident to state and federal authorities, including the Texas Commission on Environmental Quality and the EPA, and remediation activities are now completed. While the Company has not received a notice of violation nor been assessed any fines or penalties to date, the Company recorded a reserve in Other current liabilities based on anticipated clean-up costs and possible penalties to state or federal authorities. The Company does not believe that resolution of this matter will have a material impact on its financial condition or results of operations.

10. Shareholders' Equity

Common Stock

The Company's Board of Directors follows a policy of declaring, subject to legally available funds, a quarterly cash dividend on each share of the Company's Common Stock, par value $0.0001 per share ("Common Stock"), unless the Company's Board of Directors, in its sole discretion, determines otherwise. The amount available to the Company to pay its current and anticipated regular quarterly cash dividends is not currently restricted by its existing material financing arrangements and its indentures governing its senior unsecured notes. Any decision to declare and pay dividends in the future will be made at the discretion of the Company's Board of Directors and will depend on, among other things, the results of operations, cash requirements, financial condition, contractual restrictions and other factors that the Company's Board of Directors may deem relevant.

Beginning in the first quarter of 2025, the Company reduced its quarterly dividend by approximately 95%.

The Company declared a quarterly cash dividend of $0.03 per share on its Common Stock on October 14, 2026, amounting to $3 million. The cash dividend will be paid on November 10, 2026 to holders of record as of October 27, 2026.

Treasury Stock

The Company's Board of Directors authorizes repurchases of Common Stock from time to time. These authorizations give management discretion in determining the timing and conditions under which shares may be repurchased. This repurchase program does not have an expiration date.

The purchase of treasury stock reduces the number of shares outstanding. The repurchased shares may be used by the Company for compensation programs utilizing the Company's stock and other corporate purposes. The Company accounts for treasury stock using the cost method and includes treasury stock as a component of shareholders' equity.

The Company didnot repurchase any Common Stock during the nine months ended September 30, 2026 or 2025.

Other Comprehensive Income (Loss), Net

(1)Includes gross foreign currency translation adjustments related to noncontrolling interests of $2 million and $1 million for the three months ended September 30, 2026 and 2025, respectively.

(1)Includes gross foreign currency translation adjustments related to noncontrolling interests of $6 million and $2 million for the nine months ended September 30, 2026 and 2025, respectively.

Adjustments to Accumulated other comprehensive income (loss), net, attributable to Celanese Corporation are as follows:

11. Income Taxes

The effective income tax rate for the three and nine months ended September 30, 2026, was higher compared to the same periods in 2025, primarily due to a non-cash goodwill impairment loss of $1.1 billion in the Engineered Materials segment recorded during the three months ended September 30, 2025, which is not deductible for tax purposes (Note 5). The rate for the nine months ended September 30, 2025 was also favorably impacted by a deferred tax benefit related to the relocation of certain intangible assets among wholly-owned foreign affiliates as part of the continued integration of global principal operations.

In July 2025, the One Big Beautiful Bill Act ("OBBBA") was signed into law. Key provisions of the OBBBA include the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act (the "TCJA"), impacting the period of cost recovery for capital expenditures, the calculation of allowable business interest expense and the timing of deductions for domestic research and development expenses. The OBBBA also modifies international tax provisions to adjust tax rate increases scheduled for January 2026, the amount of allowable foreign tax credits to offset deemed income inclusions in the U.S. and the required allocation of U.S. expenses such as interest and stewardship to specific categories of international income. Although the Company is still actively evaluating the entire impact of the OBBBA on its operations, it does not currently expect the OBBBA to have a material impact on its effective tax rate and cash taxes.

Due to the 2017 TCJA and the resulting uncertainty as to future foreign source income, the Company previously recorded a valuation allowance on its foreign tax credit carryforwards. The Company is currently evaluating tax planning strategies to enable the use of its foreign tax credit carryforwards that may decrease the Company's effective tax rate in future periods as the valuation allowance is reversed.

In December 2021, the Organization for Economic Co-operation and Development ("OECD") issued final Model Rules for Pillars One and Two of its Base Erosion and Profit Shifting ("BEPS") project. In general, Pillar One addresses nexus concerns and the allocation of profits among companies in which a multinational enterprise ("MNE") conducts its business. Pillar Two aims to ensure that all MNEs pay an effective tax rate of no less than 15% on their adjusted net income in each of the jurisdictions in which they have operations. Pillar Two is more impactful to the Company as it allows for assessment even if the individual countries do not enact its minimum tax provisions. In effect, Pillar Two allows any country within which an MNE operates to levy tax upon that MNE to the extent it determines that the MNE is paying less than a 15% effective tax rate on its adjusted net income. The taxes levied may then be allocated among the jurisdictions that conform to the OECD rules.

On January 5, 2026, the OECD issued administrative guidance that establishes an exemption from the income inclusion rule and the undertaxed profits rule for MNE groups whose ultimate parent entity is located in a jurisdiction with a qualified side-by-side regime. Upon initial review, the U.S. would appear to qualify because it has a qualified domestic tax system and a qualified worldwide tax system. As a result, U.S. based groups are exempt from the OECD Pillar Two requirements other than for domestic top-up taxes and for certain reporting requirements. The Company will actively monitor the local country implementation of the new administrative guidance to determine the impact of the side-by-side system on its future filing positions.

The Company will continue to monitor the developments and implementation of the OECD BEPS projects. Currently the Company does not meet the requirements for the application of Pillar One. After an initial assessment of the application of the safe harbor provisions on a global basis, the Company determined that there was not a material impact from the local adoption of the OECD Pillar Two proposals in 2026, but is continuing to model the effect of these provisions, as well as the impact of the January 2026 administrative guidance, on its future effective tax rate and cash taxes.

The Company's tax returns for the years 2013 through 2015 have been subject to audit by the tax authorities in the United States, the Netherlands and Germany (collectively, the "Tax Authorities"). The Company and the Tax Authorities did not reach a joint resolution, and the audits proceeded on a jurisdiction by jurisdiction basis.

The Company has concluded settlement discussions with the Dutch and German tax authorities related to transfer pricing matters for the applicable periods. During the first quarter of 2026, the Company reached a resolution with the U.S. Internal Revenue Service (the "IRS") with respect to joint audit matters, as well as certain other transfer pricing issues for subsequent years through 2020. The Company expects to finalize the administrative resolution with the IRS prior to the end of 2026.

In addition, the audit by the U.S. tax authorities for the years 2016 through 2020 is in the data gathering phase and the Company's income tax returns in Mexico are under audit for the years 2018 through 2021.

During the first quarter of 2025, the Company initiated settlement discussions with the German tax authorities regarding certain matters related to the audit for periods after 2007. In the second quarter of 2025, the Company concluded settlement discussions with respect to the 2008 through 2012 tax years.

The Company will record the impacts of any additional audit settlements in income tax expense in the period in which such settlements are finalized. Based on information currently available, the Company does not expect any additional material impacts to the unaudited interim consolidated statements of operations.

The Company is currently subject to an inquiry by the local Chinese taxing authorities in Nantong, Zhuhai and Kunming for the taxable years 2021 through 2026 related to qualification for the beneficial treaty withholding rate of 5% on the Company's dividends from its acetate tow joint ventures received by its wholly-owned Hong Kong affiliate as opposed to the standard 10% withholding rate on dividends. The Company believes that its Hong Kong affiliate has the requisite operational substance and ownership of the dividend funds received and is in full compliance with the beneficial ownership language in the treaty and with previous notices issued by the State Taxation Administration.

As of September 30, 2026, the Company believes that an adequate provision for income taxes has been made for all open tax years related to the examinations and inquiries by governmental authorities. However, the outcome of the proceedings cannot be predicted with certainty. If any issues raised by the governmental authorities are resolved in a manner inconsistent with the Company's expectations or the Company is unsuccessful in defending its position, the Company could be required to adjust its provision for income taxes in the period such resolution occurs. If required, any such adjustments could be material to the statements of operations and cash flows in the period(s) recorded.

12. Derivative Financial Instruments

Information regarding changes in the fair value of the Company's derivative and non-derivative instruments is as follows:

(1)In March 2025, in conjunction with the March 2025 Offering (Note 7), the Company entered into cross-currency swaps to effectively convert $400 million of certain senior unsecured notes due April 15, 2030 into Japanese yen-denominated borrowings at prevailing yen interest rates, maturing on April 15, 2030. The swaps qualify and have been designated as fair value hedges of the Company's foreign currency exchange rate exposure on the long-term debt of its Japanese yen-denominated subsidiary.

(2)On June 10, 2026, the Company entered into a cross-currency swap to effectively convert $250 million of U.S. dollar-denominated borrowings into Chinese yuan-denominated borrowings at prevailing interest rates, maturing on May 15, 2027. The swap qualifies and has been designated as a net investment hedge of the Company's foreign currency exchange rate exposure on the net investment of certain of its Chinese yuan-denominated subsidiaries.

(1)In March 2025, in conjunction with the March 2025 Offering (Note 7), the Company entered into cross-currency swaps to effectively convert $400 million of certain senior unsecured notes due April 15, 2030 into Japanese yen-denominated borrowings at prevailing yen interest rates, maturing on April 15, 2030. The swaps qualify and have been designated as fair value hedges of the Company's foreign currency exchange rate exposure on the long-term debt of its Japanese yen-denominated subsidiary.

(2)On June 10, 2026, the Company entered into a cross-currency swap to effectively convert $250 million of U.S. dollar-denominated borrowings into Chinese yuan-denominated borrowings at prevailing interest rates, maturing on May 15, 2027. The swap qualifies and has been designated as a net investment hedge of the Company's foreign currency exchange rate exposure on the net investment of certain of its Chinese yuan-denominated subsidiaries.

See Note 13 for additional information regarding the fair value of the Company's derivative instruments.

Certain of the Company's commodity swaps, interest rate swaps, cross-currency swaps and foreign currency forwards and swaps permit the Company to net settle all contracts with the counterparty through a single payment in an agreed upon currency in the event of default or early termination of the contract, similar to a master netting arrangement.

Information regarding the gross amounts of the Company's derivative instruments and the amounts offset in the unaudited consolidated balance sheets is as follows:

13. Fair Value Measurements

The Company's financial assets and liabilities are measured at fair value on a recurring basis as follows:

Derivative financial instruments include interest rate swaps, commodity swaps, cross-currency swaps and foreign currency forwards and swaps and are valued in the market using discounted cash flow techniques. These techniques incorporate Level 1 and Level 2 fair value measurement inputs such as interest rates and foreign currency exchange rates. These market inputs are utilized in the discounted cash flow calculation considering the instrument's term, notional amount, discount rate and credit risk. Significant inputs to the derivative valuation for interest rate swaps, commodity swaps, cross-currency swaps and foreign currency forwards and swaps are observable in the active markets and are classified as Level 2 in the fair value measurement hierarchy.

(1)Notional amount denominated in Japanese yen.

(2)Notional amount denominated in Chinese yuan.

Carrying values and fair values of financial instruments that are not carried at fair value are as follows:

In general, the equity investments included in the table above are not publicly traded and their fair values are not readily determinable. The Company believes the carrying values approximate fair value. Insurance contracts in nonqualified trusts consist of long-term fixed income securities, which are valued using independent vendor pricing models with observable inputs in the active market and therefore represent a Level 2 fair value measurement. The fair value of long-term debt is based on valuations from third-party banks and market quotations and is classified as Level 2 in the fair value measurement hierarchy. The fair value of obligations under finance leases, which are included in long-term debt in the unaudited consolidated balance sheets, is based on lease payments and discount rates, which are not observable in the market and therefore represents a Level 3 fair value measurement.

As of September 30, 2026 and December 31, 2025, the fair values of cash and cash equivalents, receivables, trade payables, short-term borrowings and the current installments of long-term debt approximate carrying values due to the short-term nature of these instruments. These items have been excluded from the table with the exception of the current installments of long-term debt.

14. Commitments and Contingencies

Commitments

Guarantees

The Company has agreed to guarantee or indemnify third parties for environmental and other liabilities pursuant to a variety of agreements, including asset and business divestiture agreements, leases, settlement agreements and various agreements with affiliated companies. Although many of these obligations contain monetary and/or time limitations, others do not provide such limitations.

The Company has accrued for all probable and reasonably estimable losses associated with all known matters or claims. These known obligations include the following:

•Demerger Obligations

In connection with the Hoechst demerger, the Company agreed to indemnify Hoechst, and its legal successors, for various liabilities under the demerger agreement, including for environmental liabilities associated with contamination arising either from environmental damage in general ("Category A") or under 19 divestiture agreements entered into by Hoechst prior to the demerger ("Category B") (Note 9).

The Company's obligation to indemnify Hoechst, and its legal successors, is capped under Category B at €250 million. If and to the extent the environmental damage should exceed €750 million in aggregate, the Company's obligation to indemnify Hoechst and its legal successors applies, but is then limited to 33.33% of the remediation cost without further limitations. Cumulative payments under the divestiture agreements as of September 30, 2026 are $133 million. Though the Company is significantly under its obligation cap under Category B, most of the divestiture agreements have become time barred and/or any notified environmental damage claims have been partially settled.

The Company has also undertaken in the demerger agreement to indemnify Hoechst and its legal successors for (i)33.33% of any and all Category A liabilities that result from Hoechst being held as the responsible party pursuant to public law or current or future environmental law or by third parties pursuant to private or public law related to contamination and (ii) liabilities that Hoechst is required to discharge, including tax liabilities, which are associated with businesses that were included in the demerger but were not demerged due to legal restrictions on the transfers of such items. These indemnities do not provide for any monetary or time limitations. The Company has not been requested by Hoechst to make any payments in connection with this indemnification. Accordingly, the Company has not made any payments to Hoechst and its legal successors.

Based on the Company's evaluation of currently available information, including the lack of requests for indemnification, the Company cannot estimate the remaining demerger obligations, if any, in excess of amounts accrued.

•Divestiture Obligations

The Company and its predecessor companies agreed to indemnify third-party purchasers of former businesses and assets for various pre-closing conditions, as well as for breaches of representations, warranties and covenants. Such liabilities also include environmental liability, product liability, antitrust and other liabilities. These indemnifications and guarantees represent standard contractual terms associated with typical divestiture agreements and, other than environmental liabilities, the Company does not believe that they expose the Company to significant risk (Note 9).

The Company has divested numerous businesses, investments and facilities through agreements containing indemnifications or guarantees to the purchasers. Many of the indemnity or guarantee obligations contain monetary and/or time limitations, which time limitations extend through 2037. The aggregate amount of known and quantified obligations containing such limitations is $102 million as of September 30, 2026.

Based on the Company's evaluation of currently available information, including the number of requests for indemnification or other payment received by the Company, the Company cannot estimate the remaining divestiture obligations, if any, in excess of amounts accrued.

Purchase Obligations

In the normal course of business, the Company enters into various purchase commitments for goods and services. The Company maintains a number of "take-or-pay" contracts for purchases of raw materials, utilities and other services. Certain of the contracts contain a contract termination buy-out provision that allows for the Company to exit the contracts for amounts less than the remaining take-or-pay obligations. In addition, the Company has other outstanding commitments representing maintenance and service agreements, energy and utility agreements, consulting contracts and software agreements.

Unconditional purchase obligations are expected to be paid through 2042 as follows:

Contingencies

The Company is involved in legal and regulatory proceedings, lawsuits, claims and investigations incidental to the normal conduct of business, relating to such matters as product liability, land disputes, insurance coverage disputes, contracts, employment, antitrust or competition, intellectual property, personal injury, toxic tort, public nuisance and other actions in tort, workers' compensation, chemical exposure, asbestos exposure, taxes, trade compliance, acquisitions and divestitures, claims of current and legacy shareholders, past waste disposal practices and release of chemicals into the environment. The Company is actively defending those matters where the Company is named as a defendant and, based on the current facts, does not believe the outcomes from these matters would be material to the Company's results of operations, cash flows or financial position.

As previously reported, in July 2020, the Company settled a European Commission competition law investigation involving certain of its subsidiaries and three other companies related to certain past ethylene purchases. Shell Chemicals Europe ("Shell"), certain Repsol entities ("Repsol") represented by Stichting Ethylene Claims (the "Stichting"), TotalEnergies, OMV, Borealis, LyondellBasell, and certain Versalis entities represented by the Stichting have each filed separate claims for damages with the District Court of Amsterdam against four companies, including the Company, arising from those activities. Hearings have been held in certain of these matters. On July 30, 2026, the Court published rulings in the Shell and Repsol matters finding the claimants' damages claims not plausible and dismissing in their entirety all claims against the Company and the three other companies. BASF, Dow, ExxonMobil, BP, MOL Group and Braskem have filed similar claims against the Company in the Court of Munich, Germany, and Dow filed a second claim against the Company and others in the Court of Dortmund, Germany. To date,14 claims have been filed against the Company and other ethylene purchasers since 2023; however, two of these claims have been dismissed, as detailed above. On October 27, 2026, both Shell and Repsol filed individual notices of appeal of the judgments, which the Company will strongly defend against. It remains possible that new or existing claimants may assert additional claims or seek additional damages associated with the 2020 European Commission settlement. The Company expects additional hearings will take place and briefings will be filed in 2026. At this time, the Company cannot estimate but continues to assess any potential impact of these matters. The Company aggressively disputes these claims and intends to vigorously defend itself against them.

15. Segment Information

(1)Intersegment sales primarily relate to the sale of certain Acetyl Chain segment products to the Engineered Materials segment.

(2)Excludes elimination of intersegment Cost of sales of $21 million and $26 million for the three months ended September 30, 2026 and 2025, respectively, related to the sale of certain Acetyl Chain segment products to the Engineered Materials segment.

(3)Includes Foreign exchange gain (loss), net.

(4)All interest income and expense is attributable to the Company's Other Activities segment.

(5)Includes an increase in accrued capital expenditures of $6 million and $9 million for the three months ended September 30, 2026 and 2025, respectively.

(1)Intersegment sales primarily relate to the sale of certain Acetyl Chain segment products to the Engineered Materials segment.

(2)Excludes elimination of intersegment Cost of sales of $68 million and $65 million for the nine months ended September 30, 2026 and 2025, respectively, related to the sale of certain Acetyl Chain segment products to the Engineered Materials segment.

(3)Includes Foreign exchange gain (loss), net.

(4)All interest income and expense is attributable to the Company's Other Activities segment.

(5)Includes a decrease in accrued capital expenditures of $11 million and $24 million for the nine months ended September 30, 2026 and 2025, respectively.

16. Revenue Recognition

The Company has certain contracts that represent take-or-pay revenue arrangements in which the Company's performance obligations extend over multiple years.

Remaining performance obligations related to take-or-pay contracts are expected to be recognized as follows:

Disaggregated Revenue

In general, the Company's business segmentation is aligned according to the nature and economic characteristics of its products and customer relationships and provides meaningful disaggregation of each business segment's results of operations.

The Company manages its Engineered Materials business segment through its project management pipeline, which is comprised of a broad range of projects that are solutions-based and are tailored to each customer's unique needs. Projects are identified and selected based on success rate and may involve a number of different polymers per project for use in multiple end-use applications.

The Company manages its Acetyl Chain business segment by leveraging its ability to sell chemicals externally to end-use markets or downstream to its acetate tow, intermediate chemistry, emulsion polymers, redispersible powders and ethylene vinyl acetate polymers businesses. Decisions to sell externally and geographically or downstream and along the Acetyl Chain are based on market demand, trade flows and maximizing the value of its chemicals. Therefore, the Company's strategic focus is on executing within this integrated chain model and less on driving product-specific revenue.

Further disaggregation of Net sales by business segment and geographic destination is as follows:

(1)Excludes intersegment sales of $21 million and $26 million for the three months ended September 30, 2026 and 2025, respectively. Excludes intersegment sales of $68 million and $65 million for the nine months ended September 30, 2026 and 2025, respectively.

17. Earnings (Loss) Per Share

(1)Excludes anti-dilutive incremental shares attributable to equity awards as follows:

In addition, the Company incurred a net loss from continuing operations for the three and nine months ended September 30, 2025, resulting in 231,627 and 222,970, respectively, of incremental shares attributable to equity awards being excluded from the number of weighted average shares - diluted as their effect would be antidilutive.

18. Other (Charges) Gains, Net

(1)Includes employee termination benefits primarily related to the previously announced closures of the Company's facilities in Lanaken, Belgium (Note 3), Ulsan, South Korea and Sakra, Singapore during the three and nine months ended September 30, 2026, and employee termination benefits related to Company-wide business optimization projects during the three and nine months ended September 30, 2026 and 2025.

(2)Primarily related to non-cash impairment losses on goodwill and certain trade names, primarily Zytel® during the three and nine months ended September 30, 2025 (Note 5).

The changes in the restructuring liabilities by business segment are as follows: