Clearwater Paper Corp

NOTE 17: INSURANCE RECOVERIES

During 2024, we experienced a natural gas disruption due to an extreme weather event that resulted in damage at our Lewiston, Idaho facility. We received $10.5 million in insurance proceeds, of which $4.7 million was related to business interruption insurance and $5.8 million was related to reimbursable costs. Proceeds of $9.3 million, associated with continuing operations, were recorded within "Cost of sales" in the Consolidated Statements of Operations and $0.3 million related to property, plant and equipment. Proceeds associated with discontinued operations were $0.9 million.

In connection with the acquisition of a paperboard manufacturing facility and associated business (see Note 3, "Business Acquisition"), we obtained representation and warranty insurance, subject to exclusions, a policy limit of $105 million, and certain other terms and conditions, to cover losses resulting from a breach of these representations and warranties. We have notified the insurance carriers of alleged breaches of certain representations and warranties contained in the Purchase Agreement. In July and November 2025, we submitted claims to the insurance carriers for losses arising of the alleged breaches. During 2025, we received a partial settlement of $23.0 million related to these claims, of which $6.0 million was related to reimbursable costs and recorded within "Cost of sales" in the Consolidated Statements of Operations and $17.0 million related to other breaches and reported within "Other operating charges, net".