QUAKER CHEMICAL CORP

Note 1 –Basis of Presentation and Significant Accounting Policies

As used in these Notes to Consolidated Financial Statements, the terms “Quaker,” “Quaker Houghton,” the “Company,” “we,” and “our” refer to Quaker Chemical Corporation (doing business as Quaker Houghton), its subsidiaries, and associated companies, unless the context otherwise requires.

Basis of presentation: The accompanying consolidated financial statements were prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) and include the accounts of Quaker Houghton and its controlled subsidiaries.

Principles of consolidation: We consolidate all entities we control, which generally applies to entities in which we own a majority of the voting interests. Intercompany transactions and balances are eliminated in consolidation. For consolidated subsidiaries in which the Company’s ownership is less than 100%, the outside shareholders’ interests are reflected as non-controlling interests within the consolidated financial statements. The Company is not the primary beneficiary of any variable interest entities (“VIEs”) and therefore the Company’s consolidated financial statements do not include the accounts of any VIEs.

Equity method investments: The Company applies the equity method of accounting to investments in which the Company has significant influence but does not control the operating and financial decisions of the investee. This generally applies when the Company’s ownership interest in common stock of the investee is between 20% and 50%. Such investments are presented in “Investments in associated companies” on the Consolidated Balance Sheets. We initially record our investment at cost and subsequently adjust the investment to recognize our share of net earnings and losses and distributions received. The Company’s share of net income or losses in these investments in associated companies is included in the Consolidated Statements of Operations. The Company reviews these investments for impairments when events or changes in circumstances indicate that the carrying amount of the investment may be other-than-temporarily impaired. See Note 16, Investments in Associated Companies, for additional information.

Accounting estimates: The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and the accompanying notes. Actual results could differ from such estimates.

Foreign currency: Since we do business in many foreign countries, fluctuations in currency exchange rates affect our financial position and result of operations. In most of our non-U.S. operations, the local currency is considered the functional currency. The assets and liabilities of non-U.S. subsidiaries and associated companies are translated into U.S. dollars at the respective rates of exchange prevailing at the end of the year. Income and expense accounts are translated at average exchange rates prevailing during the year. Translation adjustments resulting from this process are recorded directly in equity as accumulated other comprehensive income (“AOCI”). Some transactions are made in currencies different from an entity’s functional currency. Gains and losses from remeasurement of these foreign currency transactions, and the impact of related hedges, are generally reflected in “Other (expense) income, net” in the Consolidated Statement of Operations as they occur. See Note 9, Other (expense) income, net, and our policy on accounting for hyperinflation below, for additional information.

Hyper-inflationary accounting: Economies that have a cumulative three-year rate of inflation exceeding 100% are considered hyper-inflationary. A legal entity that operates within an economy deemed to be hyper-inflationary is required to remeasure its monetary assets and liabilities to the applicable published exchange rates and record the associated gains or losses resulting from the remeasurement directly to the Consolidated Statements of Operations.

Argentina’s and Türkiye’s economies were considered hyper-inflationary effective July 1, 2018 and April 1, 2022, respectively. As of, and for the year ended December 31, 2025, the Company's Argentine and Turkish subsidiaries represented a combined 1% and 2% of the Company’s consolidated total assets and net sales, respectively. For the years ended December 31, 2025, 2024 and 2023, the Company recorded $2.2 million, $0.8 million, and $7.8 million, respectively, of remeasurement losses associated with the applicable currency conversions related to Argentina and Türkiye. These losses were recorded within foreign exchange losses, net, which is a component of Other (expense) income, net, in the Company’s Consolidated Statements of Operations.

Segments: The Company’s operating segments, which are consistent with its reportable segments, reflect the structure of the Company’s internal organization, the method by which the Company’s resources are allocated and the manner by which the Chief Operating Decision Maker assesses the Company’s performance.

Reclassifications: Certain information has been reclassified to conform to the current year presentation.

Business combinations: The Company accounts for business combinations under the acquisition method of accounting. This method requires the recording of acquired assets, including separately identifiable intangible assets, and assumed liabilities at their respective acquisition date estimated fair values. Any excess of the purchase price over the estimated fair value of the identifiable net assets acquired is recorded as goodwill. The determination of the estimated fair value of assets acquired and liabilities assumed requires significant estimates and assumptions.

The Company engaged an independent third-party valuation specialist to assist with the allocation of the total purchase price for the acquisition of Dipsol Chemicals Co., Ltd. and its subsidiaries, (“Dipsol”) to the fair value of the net assets acquired. The preliminary fair value of customer-related intangible assets was determined using the multi-period excess earnings method, while the preliminary fair value of product technology and trademarks were determined using the relief from royalty method. These valuation methodologies required the use of several assumptions and estimates, including, but not limited to, the customer attrition rate, the discount rate, net sales attributable to existing customers, the economic life, the EBITDA margin, and the contributory asset charge for the customer-related intangible assets, and the discount rate, the projected revenue, the royalty rate, and the economic life for the product technology and trademark intangible assets. The preliminary fair value of inventory was determined using the net realizable value approach, which includes the use of several estimates, including the selling prices and current replacement cost as of the valuation date. The preliminary fair value of land was determined using a sales comparison approach, which includes the use of several assumptions and estimates, including reproduction/replacement cost, while the preliminary fair value of building and improvements and personal property was determined using the cost approach, which includes the use of several assumptions and estimates, including the building condition, floor value, physical deterioration, functional and economic obsolescence, reproduction/replacement cost, and remaining useful lives.

Based on the assessment of additional information during the measurement period, which may be up to one year from the acquisition date, the Company may record adjustments to the estimated fair value of assets acquired and liabilities assumed. See Note 2, Business Combinations, for additional information.

Revenue recognition: The Company recognizes revenue in an amount that reflects the consideration to which the Company expects to be entitled in exchange for goods or services transferred to its customers. To do this, the Company applies a five-step model, which requires the Company to: (i) identify the contract with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when, or as, the Company satisfies the performance obligation.

The Company identifies a contract with a customer when a sales agreement indicates approval and commitment of the parties; identifies the rights of the parties; identifies the payment terms; has commercial substance; and it is probable that the Company will collect the consideration to which it will be entitled in exchange for the goods or services that will be transferred to the customer.

The Company identifies a performance obligation in a contract for each promised good or service that is separately identifiable from other obligations in the contract and for which the customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer. The Company determines the transaction price as the amount of consideration it expects to be entitled to in exchange for fulfilling the performance obligations, including the effects of any variable consideration, significant financing elements, amounts payable to the customer or noncash consideration. For any contracts that have more than one performance obligation, the Company allocates the transaction price to each performance obligation in an amount that depicts the amount of consideration to which the Company expects to be entitled in exchange for satisfying each performance obligation.

In accordance with the last step of the five-step model, the Company recognizes revenue when, or as, it satisfies the performance obligation in a contract by transferring control of a promised good or providing the service to the customer. The Company typically satisfies its performance obligations and recognizes revenue at a point in time for product sales, generally when products are shipped or delivered to the customer, depending on the terms underlying each arrangement. In circumstances where the Company’s products are on consignment, revenue is generally recognized upon usage or consumption by the customer. For any Fluidcare TM or other services provided by the Company to the customer, the Company typically satisfies its performance obligations and recognizes revenue over time, as the promised services are performed. The Company uses input methods to recognize revenue over time related to these services, including labor costs and time incurred. The Company believes that these input methods represent the most indicative measure of the Fluidcare TM or other service work performed by the Company.

The Company does not have standard payment terms for all customers; however, the Company’s general payment terms require customers to pay for products or services once the performance obligation is satisfied. The Company does not have significant financing arrangements with its customers.

In addition, the Company expenses costs to obtain a contract as incurred when the expected period of benefit, and therefore the amortization period, is one year or less. In addition, the Company excludes from the measurement of the transaction price all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by the entity from a customer, including sales, use, value added, excise and various other taxes. Lastly, the Company has elected to account for shipping and handling costs incurred after the customer has obtained control of a good as a fulfillment cost, rather than an additional promised service. The Company does not have significant amounts of variable consideration in its contracts with customers.

The Company records license fees received from third-parties in Other (expense) income, net, in its Consolidated Statements of Operations, which generally include sales-based royalties in exchange for the license of intellectual property. These license fees are recognized in accordance with their agreed-upon terms and when performance obligations are satisfied, which is generally when the third party has a subsequent sale.

The Company recognizes a contract asset or receivable on its Consolidated Balance Sheet when the Company performs a service or transfers a good in advance of receiving consideration. A receivable is the Company’s right to consideration that is unconditional and only the passage of time is required before payment of that consideration is due. A contract asset is the Company’s right to consideration in exchange for goods or services that the Company has transferred to a customer.

A contract liability is recognized when the Company receives consideration, or if it has the unconditional right to receive consideration, in advance of performance. A contract liability is the Company’s obligation to transfer goods or services to a customer for which the Company has received consideration, or a specified amount of consideration is due, from the customer.

See Note 5, Net Sales and Revenue Recognition, for additional information.

Right-of-use lease assets and lease liabilities: The Company determines if an arrangement is a lease at its inception. This determination generally depends on whether the arrangement conveys the right to control the use of an identified asset for a period of time in exchange for consideration. Control of an underlying asset is conveyed if the Company obtains the right to direct the use of the asset, and obtains substantially all of the economic benefits from its use. Lease expense for variable leases and short-term leases is recognized when the obligation is incurred.

The lease term for all of the Company’s leases includes the non-cancellable period of the lease, adjusted for any renewal and termination options that the Company is reasonably certain it will exercise. Operating leases are included in right-of-use lease assets, other accrued liabilities and long-term lease liabilities on the Consolidated Balance Sheet. Right-of-use lease assets and liabilities are recognized on the lease commencement date based on the present value of lease payments over the respective lease term. Operating lease expense is recognized on a straight-line basis over the lease term.

The Company uses the stated borrowing rate for a lease when readily determinable. When a stated borrowing rate is not available in a lease agreement, the Company uses its incremental borrowing rate at the lease commencement date to determine the present value of its lease payments. In determining the incremental borrowing rate, the Company considers information including fully secured borrowing rates readily available to the Company and its subsidiaries. The Company includes finance leases in property, plant and equipment (“PP&E”), current portion of long-term debt and long-term debt on the Consolidated Balance Sheet. See Note 6, Leases, for additional information.

Restructuring activities: Restructuring programs consist of employee severance, rationalization of manufacturing or other facilities and other related items. To account for such programs, the Company recognizes a liability for the cost associated with an exit or disposal activity, when the liability is incurred, is estimable, and payment is probable. See Note 7, Restructuring and Related Activities, for additional information.

Share-based compensation: The Company has long-term incentive programs (“LTIP”) for key employees which provides for the granting of stock options, restricted stock units (“RSU”), restricted stock awards (“RSAs”), and performance-based stock awards (“PSUs”). Share-based awards may also be granted under other equity compensation plans. Share-based compensation cost for awards under LTIP and equity compensation plans is measured at the grant date based on the fair value and is recognized as expense over the requisite service period, which is the vesting period.

The fair value of stock options granted is determined using the Black-Scholes option valuation model on the grant date. The fair value of time-based RSAs, time-based RSUs, and performance-based PSUs, for which the performance measure is return on investment capital (“ROIC”), is based on the trading price of the Company’s common stock on the date of grant. The fair value of market-based PSUs, for which the performance measure is total shareholder return (“TSR”), is determined using a Monte Carlo simulation model.

The Company elected to account for forfeitures on awards as they occur.

See Note 8, Equity, for additional information.

Research and development costs: Research and development costs are expensed as incurred and are included in selling, general and administrative expenses (“SG&A”). Research and development expenses were $60.7 million, $57.3 million and $50.3 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Income taxes and uncertain tax positions: The provision for income taxes is determined using the asset and liability approach of accounting for income taxes. Under this approach, deferred taxes represent the future tax consequences expected to occur when the reported amounts of assets and liabilities are recovered or paid. The provision for income taxes represents income taxes paid or payable for the current year and the change in deferred taxes during the year. Deferred taxes result from differences between the financial and tax bases of the Company’s assets and liabilities and are adjusted for changes in tax rates and tax laws when changes are enacted. Valuation allowances are recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized. The Company accounts for uncertainty in income taxes by applying the recognition threshold and measurement attributes for financial statement recognition and measurement of tax positions taken or expected to be taken on a tax return. The Company determines whether the benefits of tax positions are probable or more likely than not sustained upon audit based upon the technical merits of the tax position. For tax positions that are determined to be more likely than not sustained upon audit, the Company recognizes the largest amount of benefit that is greater than 50% likely of being realized upon ultimate settlement in the financial statements. For tax positions that are not determined to be more likely than not sustained upon audit, the Company does not recognize any portion of the benefit in the financial statements. Additionally, the Company monitors and adjusts for derecognition, classification, and penalties and interest in interim periods, with appropriate disclosure and transition thereto. Also, the amount of interest expense and income related to uncertain tax positions is computed by applying the applicable statutory rate of interest to the difference between the tax position recognized, including timing differences, and the amount previously taken or expected to be taken in a tax return. The Company recognizes interest and/or penalties related to income tax matters in income tax expense. Finally, when applicable, the Company nets its liability for unrecognized tax benefits against deferred tax assets related to net operating losses or other tax credit carryforwards that would apply if the uncertain tax position were settled for the presumed amount at the balance sheet date.

Pursuant to the Tax Cuts and Jobs Act (“U.S. Tax Reform”), specifically the one-time tax on deemed repatriation (the “Transition Tax”), the Company has provided for U.S. income tax on its undistributed earnings of non-U.S. subsidiaries. However, the Company is subject to and will incur other taxes, such as withholding taxes and dividend distribution taxes, if these undistributed earnings were ultimately remitted to the U.S. The Company currently intends to reinvest its future undistributed earnings of non-U.S. subsidiaries to support working capital needs and certain other growth initiatives of those subsidiaries. However, in certain cases the Company has and may in the future change its indefinite reinvestment assertion for any or all of these undistributed earnings. In this case, the Company would estimate and record a tax liability and corresponding tax expense for the amount of non-U.S. income taxes it would incur to ultimately remit these earnings to the U.S. See Note 10, Income Taxes, for additional information.

Earnings per share: In the Company’s earnings per share calculation, non-vested stock awards with rights to non-forfeitable dividends are included as part of the basic weighted average share calculation under the two-class method. See Note 11, Earnings per Share, for additional information.

Comprehensive income (loss): The Company presents Other comprehensive income (loss) in its Statements of Comprehensive Income (Loss). The Company discloses significant amounts reclassified from each component of AOCI, the related tax amounts and the income statement line items affected by such reclassifications. See Note 22, Accumulated Other Comprehensive Loss, for additional information.

Cash and cash equivalents: The Company invests temporary and excess funds in money market securities and financial instruments having maturities within 90 days. The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents. The Company has not experienced losses from the aforementioned investments.

Accounts receivable and allowance for credit losses: Trade accounts receivable subject the Company to credit risk. Trade accounts receivable are recorded at the invoiced amount and generally do not bear interest. The Company recognizes an allowance for credit losses, which represents the portion of the receivable that the Company does not expect to collect over its contractual life, considering past events and reasonable and supportable forecasts of future economic conditions. The Company’s allowance for credit losses on its trade accounts receivable is based on specific collectability facts and circumstances, the aging of outstanding receivables, and the associated collection risk the Company estimates for certain past due aging categories, and also, the general risk to all outstanding accounts receivable based on historical amounts determined to be uncollectible. The Company does not have any off-balance-sheet credit exposure related to its customers. See Note 12, Accounts Receivable and Allowance for Credit Losses, for additional information.

Inventories: Inventories are valued at the lower of cost or net realizable value, and are valued using the first-in, first-out method. See Note 13, Inventories, for additional information.

Long-lived assets: PP&E is stated at gross cost, less accumulated depreciation. Depreciation is computed using the straight-line method on an individual asset basis over the following estimated useful lives: buildings and improvements,10 to 33 years (for finance leases, the remaining term of the lease); and machinery and equipment,4 to 10 years (for financing leases, the remaining term of the lease). The carrying values of long-lived assets are evaluated whenever changes in circumstances or current events indicate the carrying amount of such assets may not be recoverable. An estimate of undiscounted cash flows produced by the asset, or the appropriate group of assets, is compared with the carrying value to determine whether an impairment exists. If necessary, the Company recognizes an impairment loss for the difference between the carrying amount of the assets and their estimated fair value. Fair value is based on current and anticipated future cash flows. Upon sale or other disposition of long-lived assets, the applicable asset cost and accumulated depreciation are removed from the accounts and the net amount, less proceeds from disposals, is recorded in the Consolidated Statements of Operations. Expenditures for improvements that increase the estimated useful life or capacity of the assets are capitalized, whereas expenditures for repairs and maintenance are expensed when incurred. See Note 14, Property, Plant, and Equipment, for additional information.

Capitalized software: The Company capitalizes certain costs in connection with developing or obtaining software for internal use. These costs are amortized over the expected useful life of the software- generally 3 to 5 years once the assets are ready for their intended use. In connection with implementations and upgrades to the Company’s global transaction, consolidation and other related systems, approximately $2.3 million and $2.9 million of net costs were capitalized in PP&E on the Company’s Consolidated Balance Sheets as of December 31, 2025 and 2024, respectively.

The Company capitalizes costs incurred with the implementation of a cloud computing arrangement that is a service contract, consistent with its policy for software for internal use. The capitalized costs are reflected in “Prepaid expenses and other current assets” and "Other non-current assets" on its Consolidated Balance Sheets and expensed over the term of the related hosting arrangement.

Goodwill and other intangible assets: The Company records goodwill, definite-lived intangible assets and indefinite-lived intangible assets at fair value at the date of acquisition. Goodwill and indefinite-lived intangible assets are not amortized but tested for impairment at least annually. These tests will be performed more frequently if triggering events indicate potential impairment. In completing a quantitative goodwill impairment test, the Company compares a reporting unit’s fair value, based on future discounted cash flows, to its carrying value in order to determine if an impairment charge is warranted.

Definite-lived intangible assets are amortized on a straight-line basis over their estimated useful lives, generally for periods ranging from 5 to 24 years. The Company continually evaluates the reasonableness of the useful lives of these assets, consistent with the discussion of long-lived assets, above.

See Note 15, Goodwill and Other Intangible Assets, and Note 23, Fair Value Measures, for additional information.

Fair value measurements: Fair value is defined as an exit price, or the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. See Notes 20, 23 and 24 for additional information. The following briefly describes those three levels:

•Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities.

•Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly, for sustainability the full term of the asset or liability. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.

•Level 3: Unobservable inputs for the asset or liability that reflect the reporting entity's own assumptions about the assumptions that market participants would use in pricing the asset or liability.

Pension and other postretirement benefits: The Company maintains various noncontributory retirement plans, covering a portion of its employees in the U.S. and certain other countries, including the Netherlands, the United Kingdom (“U.K.”), Mexico, Sweden, Germany and France. The plans of the remaining non-U.S. subsidiaries are, for the most part, either fully insured or integrated with the local governments’ plans. The Company recognizes the funded status of defined benefit pension and other postretirement plans on its Consolidated Balance Sheets and also, recognizes as a component of AOCI, net of tax, the gains or losses and prior service costs that arise during the period but are not recognized as components of net periodic benefit cost. In addition, the Company recognizes a settlement charge in its Consolidated Statements of Operations when certain events occur, including plan termination or the settlement of certain plan liabilities. A settlement charge represents the immediate recognition into expense of a portion of the unrecognized loss within AOCI on the balance sheet in proportion to the share of the projected benefit obligation that was settled. The measurement date for the Company’s postretirement benefits plan is December 31.

The Company’s global pension investment policies are designed to ensure that pension assets are invested in a manner consistent with meeting the future benefit obligations of the pension plans and maintaining compliance with various laws and regulations including the Employee Retirement Income Security Act of 1974. The Company establishes strategic asset allocation percentage targets and benchmarks for significant asset classes with the aim of achieving a prudent balance between return and risk. The Company’s investment horizon is generally long term, and, accordingly, the target asset allocations encompass a long-term perspective of capital markets, expected risk and return and perceived future economic conditions while also considering the profile of plan liabilities. To the extent feasible, the short-term investment portfolio is managed to match the short-term obligations, the intermediate portfolio duration is matched to reduce the risk of volatility in intermediate plan distributions, and the total return portfolio is managed to maximize the long-term real growth of plan assets. The critical investment principles of diversification, assessment of risk and targeting the optimal expected returns for given levels of risk are applied. The Company’s investment guidelines prohibit the use of securities such as letter stock and other unregistered securities, commodities or commodity contracts, short sales, margin transactions, private placements (unless specifically addressed by addendum), or any derivatives, options or futures for the purpose of portfolio leveraging.

The target asset allocation is reviewed periodically and is determined based on a long-term projection of capital market outcomes, inflation rates, fixed income yields, returns, volatilities and correlation relationships. The interaction between plan assets and benefit obligations is periodically studied to assist in establishing such strategic asset allocation targets. Asset performance is monitored with an overall expectation that plan assets will meet or exceed benchmark performance over rolling five-year periods. The Company’s pension committee, as authorized by the Company’s Board, has discretion to manage the assets within established asset allocation ranges approved by senior management of the Company. See Note 20, Pension and Other Postretirement Benefits, for additional information.

Derivatives: The Company uses interest rate swap agreements to manage risk, including exposure to variability in interest payments associated with its variable rate debt. Interest rate swaps are designated as cash flow hedges and, as such, the contracts are marked-to-market at each reporting date and any unrealized gains or losses are included in AOCI to the extent effective and reclassified to interest expense in the period during which the transaction affects earnings or it becomes probable that the forecasted transaction will not occur.

The Company uses fixed-for-fixed cross-currency swap agreements to manage risk, including to hedge the variability of exchange rates of our foreign net investments. The fixed-for-fixed cross-currency swap agreements are designated as net investment hedges and, as such, the agreements are marked to market at each reporting date and any unrealized gains or losses are included in unrealized currency translation adjustments, within AOCI. The Company uses the spot method to evaluate the effectiveness of the net investment hedges.

The Company uses foreign exchange forward contracts to economically hedge the impact of variability in exchange rates on certain assets and/or liabilities denominated in foreign currencies. Forward contracts are marked-to-market at each reporting date, with changes in the fair value of the underlying instruments, as well as gains and losses on the hedged foreign currency transactions, recognized in earnings in Other (expense) income, net. The fair value of forward contracts are determined from sources independent of the Company, including the financial institutions which are party to the derivative instruments. See Note 24, Hedging Activities, for additional information.

Environmental liabilities and expenditures: Accruals for environmental matters are recorded when it is probable that a liability has been incurred and the amount of the liability can be reasonably estimable. If there is a range of estimated liability and no amount in that range is considered more probable than another, then the Company records the lowest amount in the range. Environmental costs and remediation costs are capitalized if the costs extend the life, increase the capacity or improve safety or efficiency of the property from the date acquired or constructed, and/or mitigate or prevent contamination in the future. See Note 25, Commitments and Contingencies, for additional information.

Note 2 –Business Combinations

Dipsol

In April 2025, the Company acquired 100% of the outstanding equity interests of Dipsol for approximately $185.6 million (27.7 billion JPY), which included approximately $30.1 million (4.5 billion JPY) of acquired cash for a net purchase price of approximately $155.5 million (23.2 billion JPY). In July 2025, the Company satisfied all routine and customary post-closing conditions and finalized the purchase price with no adjustments. The Company funded the acquisition purchase price with borrowings under its existing credit facility. In connection with the acquisition of Dipsol, the Company entered into foreign currency forward contracts, which resulted in a $187.0 million cash payment and a $1.4 million foreign currency loss recognized during the year ended December 31, 2025. Dipsol is headquartered in Japan and is a leading supplier of surface treatment and plating solutions and services primarily for the automotive and other industrial applications end markets. Dipsol has operations in several countries, and these operations are reported within the Company’s respective Americas, EMEA, and Asia/Pacific segments. This acquisition expands the Company’s advanced solutions businesses in attractive end markets with solid growth characteristics. Dipsol also provides significant cross-selling opportunities and enhances the Company’s ability to meet the needs of our customers across the globe.

The following table presents the preliminary estimated fair values of Dipsol assets acquired and liabilities assumed as of the acquisition date:

(1)The Company recorded approximately $0.2 million of net measurement period adjustments during the year ended December 31, 2025 to reflect changes in net working capital and tax balances. All measurement period adjustments were offset against goodwill.

As of December 31, 2025, the allocation of the purchase price has not been finalized and theone-year measurement period has not ended. Further adjustments may be necessary, primarily for working capital adjustments and tax balances, as a result of the Company’s ongoing assessment of additional information related to the fair value of assets acquired and liabilities assumed.

The Company allocated $55.0 million of the purchase price to intangible assets across the Americas, EMEA, and Asia/Pacific segments. Customer relationships, product technologies, and trademarks will be amortized over 14 years,8 years, and 13 years, respectively.

The following table presents the intangible assets recognized for each reportable segment:

The Company recognized $53.1 million of goodwill, which is comprised of $46.9 million in the Asia/Pacific segment, $5.8 million in the Americas segment, and $0.4 million in the EMEA segment. The goodwill is not deductible for tax purposes. The goodwill is primarily attributable to expected synergies.

Total sales included in the Consolidated Statement of Operations for the year ended December 31, 2025 was $62.7 million. Total loss before taxes included in the Consolidated Statement of Operations for the year ended December 31, 2025 was $5.4 million, which includes $6.0 million amortization of the fair value step-up in inventories and $4.9 million depreciation expense recorded in connection with the fair value step-up of property, plant, and equipment and amortization expense recorded for its definite-lived intangible assets.

Natech

In April 2025, the Company acquired 100% of the outstanding equity interests of Natech, Ltd., (“Natech”) for approximately $6.5 million, which includes an initial cash payment of $6.0 million and a deferred payment of $0.5 million, subject to routine and customary post-closing adjustments, including an adjustment for working capital. Assets acquired included cash and cash equivalents of $1.5 million. Natech is based in the United Kingdom and is a manufacturer of surface treatment chemicals for a variety of industrial applications. Natech is reported as part of the EMEA reportable segment. This acquisition strengthens Quaker Houghton’s overall surface treatment product and application capabilities within Europe. The Company allocated $2.1 million of the purchase price to intangible assets and recognized $2.6 million of goodwill in the EMEA segment, none of which is deductible for tax purposes. The goodwill is primarily attributable to expected growth synergies. During the third quarter of 2025, the Company settled the working capital adjustment for an immaterial amount. As of December 31, 2025, the allocation of the purchase price has been finalized.

CSI

In February 2025, the Company acquired 100% of the outstanding equity interests of Chemical Solutions & Innovations (Pty) Ltd. (“CSI”), for approximately $3.9 million, subject to routine and customary post-closing adjustments, including an adjustment for working capital. CSI is based in South Africa and is a supplier of metalworking fluids and lubricants to the South African market. CSI is reported as part of the EMEA reportable segment. This acquisition strengthens Quaker Houghton’s position in South Africa and expands the Company’s presence in that region. The Company allocated $1.4 million of the purchase price to intangible assets and recognized $1.7 million of goodwill in the EMEA segment, none of which is deductible for tax purposes. The goodwill is primarily attributable to expected growth synergies. During the third quarter of 2025, the Company settled the working capital adjustment for an immaterial amount. As of December 31, 2025, the allocation of the purchase price has been finalized.

Previous Acquisitions

In July 2024, the Company acquired 100% of the outstanding equity interests of the Sutai Group (“Sutai”), for approximately $16.2 million, including an initial cash payment of $14.6 million, subject to routine and customary post-closing adjustments related to working capital and net indebtedness levels, as well as earn-out provisions with an initial estimated payout of $1.6 million related to the finalization of 2024 and 2025 earnings. Assets acquired included cash and cash equivalents of $5.5 million. The Company recorded incremental income of $0.8 million during the year ended December 31, 2025 relating to adjustments to these earnout provisions in Other (expense) income, net on the Consolidated Statements of Operations. As of December 31, 2025, the Company does not have any remaining earnout liabilities recorded on its Consolidated Balance Sheets. Sutai is based in Japan and provides impregnation treatment products and services to the automotive and other industries. Sutai is reported as part of the Asia/Pacific reportable segment. This acquisition strengthens Quaker Houghton’s technology portfolio, enabling the Company to better support and optimize production processes for customers across the Japanese, Asia Pacific and global markets. The Company allocated $3.1 million of the purchase price to intangible assets and recognized $5.5 million of goodwill in the Asia/Pacific segment, none of which is deductible for tax purposes. The goodwill is primarily attributable to expected synergies. During the first quarter of 2025, the Company settled the working capital adjustment for an immaterial amount which impacted the residual goodwill recorded. As of December 31, 2025, the allocation of the purchase price has been finalized.

During February 2024, the Company acquired 100% of the outstanding equity interests of I.K.V. Tribologie IKVT and its subsidiaries (“IKV”) for $35.2 million, including an initial cash payment of $29.7 million, subject to routine and customary post-closing adjustments related to working capital and net indebtedness levels as well as earn-out provisions related to the finalization of 2023 earnings. Assets acquired included approximately $4.8 million of cash and cash equivalents. IKV, which is part of the Company’s EMEA segment, specializes in high-performance lubricants and greases, including original equipment manufacturer first-fill greases that are primarily used in the automotive, aerospace, electronics and other industrial markets. The acquisition of IKV strengthens the Company’s position in first-fill greases. The Company allocated $15.0 million of the purchase price to intangible assets, comprised of approximately $11.1 million of customer relationships to be amortized over 16 years; $3.2 million of product technologies to be amortized over 14 years; and $0.7 million of trademarks to be amortized over 5 years. In addition, the Company recognized $16.4 million of goodwill in the EMEA segment, none of which is deductible for tax purposes. The goodwill is primarily attributable to expected cost and growth synergies. In July 2024, the 2023 earnings were finalized and the Company made a payment of $5.5 million in connection with the post-closing adjustments and earn-out provision. As of December 31, 2025, the allocation of the purchase price has been finalized.

The results of operations of Dipsol, Natech, CSI, Sutai and IKV subsequent to the acquisition dates are included in the Consolidated Statements of Operations for the year ended December 31, 2025.

During the year ended December 31, 2025, the Company recognized $12.0 million of acquisition-related expenses including legal, financial, consulting and other costs, compared to $1.9 million during the year ended December 31, 2024. There wereno acquisition-related expenses recognized during the year ended December 31, 2023. These costs are included in Selling, general and administrative expenses (“SG&A”) in the Consolidated Statements of Operations.

Certain pro forma and other information is not presented, as the operations of the acquired assets and businesses are not considered material to the overall operations of the Company for the periods presented.

Note 3 –Recently Issued Accounting Standards

Recently Adopted Accounting Standards

The Company has adopted Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures beginning with the 2024 Form 10-K and the Form 10-Q for the period ended March 31, 2025. This ASU expands reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses, defined as those expenses that are regularly provided to the Chief Operating Decision Maker (“CODM”) and included in the reported measure of segment profit or loss. The Company disclosed that the CODM assesses segment performance and makes decisions about allocating resources to its operating segments using segment operating earnings. Based on the Company’s assessment, the Company determined that product costs are significant segment expenses that are regularly provided to the CODM and included in segment operating earnings. See Note 4, Business Segments, for additional information.

The Company has adopted ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures on a prospective basis in this Report. Pursuant to this ASU, the Company disclosed additional information in specified categories with respect to the reconciliation of the effective tax rate to the statutory rate (the “rate reconciliation”) for federal, state, and foreign income taxes, which required greater detail about individual reconciling items in the rate reconciliation to the extent the impact of those items exceeded a specified threshold. Additionally, the Company disclosed income taxes paid disaggregated by federal, state, and foreign taxes and further disaggregated these disclosures in certain jurisdictions where income taxes paid exceeded a certain threshold. See Note 10, Income Taxes, for additional information.

Recently Issued Accounting Standards Not Yet Adopted

The FASB issued ASU 2024-03, Income Statement- Reporting Comprehensive Income- Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses in November 2024. This ASU requires public business entities (“PBEs”) to disclose, in interim and annual reporting periods, additional information about certain expenses in the notes to the financial statements, including disclosing the amounts of purchases of inventory, employee compensation, depreciation, and intangible asset amortization in each relevant expense caption. It also requires PBEs to disclose a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively and to disclose the total amount of selling expenses, and in the annual reporting periods, an entity’s definition of selling expenses. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, with early adoption permitted. The Company is currently evaluating the disclosure requirements of this standard and the impact on its consolidated financial statements.

The FASB issued ASU 2025-06, Intangibles- Goodwill and Other- Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software in September 2025. This ASU removes all references to prescriptive and sequential software development stages and will now require PBEs to start capitalizing software costs when management has authorized and committed to funding the software project and it is probable that the project will be completed and the software will be used to perform the function intended. The ASU also specifies that the disclosures in Subtopic 360-10, Property, Plant, and Equipment- Overall are required for all capitalized internal-use software costs. ASU 2025-06 is effective for fiscal years beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the disclosure requirements of this standard and the impact on its consolidated financial statements.

The FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements in December 2025. This ASU amends Topic 270, by improving the navigability of the required interim disclosures and clarifying when that guidance is applicable. The amendments also provide additional guidance on what disclosures should be provided in interim reporting periods. Additionally, the amendment requires entities to disclose events since the end of the last annual reporting period that have a material impact on the entity. ASU 2025-11 is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the disclosure requirements of this standard and the impact on its consolidated financial statements.

Note 4 –Business Segments

The Company’s operating segments, which are consistent with its reportable segments, reflect the structure of the Company’s internal organization and the manner by which the CODM, which is the Company’s Chief Executive Officer, allocates resources and assesses performance.

The CODM evaluates performance for the Company’s operating segments based on segment operating earnings. Segment operating earnings for each of the Company’s reportable segments are comprised of the segment’s net sales less directly related product costs and other segment items. Operating expenses not directly attributable to the net sales of each respective segment, such as certain corporate and administrative costs, impairment charges, and restructuring charges, are not included in segment operating earnings. Other items not specifically identified with the Company’s reportable segments include Interest expense and Other (expense) income, net.

The CODM uses segment operating earnings to allocate resources for each segment predominantly in the annual budget and forecasting process. The CODM considers budget-to-actual variances on a monthly basis for segment operating earnings when making decisions about allocating capital and personnel to the segments. The CODM also uses segment operating earnings to assess the performance for each segment and in the compensation of certain employees.

Segment asset information is not regularly provided to or reviewed by the CODM. Therefore, the Company does not disclose segment asset information for each reportable segment.

The following table presents information about the performance of the Company’s reportable segments for the years ended December 31, 2025, 2024 and 2023.

(1)Net sales relate to external customers only. All intersegment sales are eliminated in consolidation.

(2)Product costs include the costs of raw materials and are recorded in Cost of goods sold in the Company’s Consolidated Statements of Operations.

(3)Other operating expenses include overhead costs of operating the Company’s production facilities and providing chemical management services to customers and direct SG&A costs.

(4)Product costs includes the $6.0 million amortization of the fair value step-up in Dipsol's inventories as a result of the acquisition for the year ended December 31, 2025, which is comprised of approximately $2.6 million in the Americas segment, $3.0 million in the Asia/Pacific segment, and $0.4 million in the EMEA segment.

(5)Product costs includes a $2.9 million gain related to immaterial out-of-period adjustments for inventory for the year ended December 31, 2025, which was comprised of a $0.7 million gain in the Americas segment and a $2.2 million gain in the EMEA segment.

The following table presents a reconciliation of the Company’s segment operating earnings to income before taxes and equity in net income of associated companies in the Company’s Consolidated Statements of Operations for the years ended December 31, 2025, 2024 and 2023.

The following tables present information regarding the Company’s reportable segments’ depreciation for identifiable assets for the years ended December 31, 2025, 2024 and 2023:

The following tables summarize net sales attributed to geographic regions based on the country of origin and long-lived assets attributed to geographic regions based on asset location for the years ended December 31, 2025, 2024 and 2023:

Note 5 –Net Sales and Revenue Recognition

Customer Concentration

A significant portion of the Company’s revenues are realized from the sale of process fluids and services to manufacturers of steel, aluminum, automotive, aerospace, industrial and agricultural equipment, and durable goods. During the year ended December 31, 2025, the Company’s five largest customers (each composed of multiple subsidiaries or divisions with semiautonomous purchasing authority) accounted for approximately 11% of consolidated net sales, with its largest customer accounting for approximately 3% of consolidated net sales.

Contract Assets and Liabilities

The Company had no material contract assets recorded on its Consolidated Balance Sheets as of December 31, 2025 and 2024.

The Company had approximately $3.6 million and $4.2 million of deferred revenue as of December 31, 2025 and 2024, respectively. During the years ended December 31, 2025 and 2024, the Company satisfied materially all of the associated performance obligations and recognized into revenue the advance payments received and recorded as of December 31, 2024 and 2023, respectively.

Disaggregated Revenue

The Company sells its industrial process fluids, specialty chemicals and technical expertise as a global product portfolio. The Company generally manages and evaluates its performance by reportable segment first, and then by customer industries. Net sales of each of the Company’s major product lines are generally spread throughout allthree of the Company’s segments, and in most cases, approximately proportionate to the level of total sales in each segment.

The following tables present disaggregated information regarding the Company’s net sales, first by major product lines that represent more than 10% of the Company’s consolidated net sales for the years ended December 31, 2025, 2024 and 2023, and followed then by a disaggregation of the Company’s net sales by segment and customer industry for the years ended December 31, 2025, 2024 and 2023.

Note 6 –Leases

The Company has operating leases for facilities, vehicles, and machinery and equipment with remaining lease terms up to 9 years. In addition, the Company has land use leases with remaining lease terms up to 89 years.

The Company’s finance leases are included in PP&E in the Consolidated Balance Sheets. See Note 14, Property, Plant and Equipment, for additional information. The Company hasno material variable lease costs or sublease income for the years ended December 31, 2025, 2024 and 2023.

During the year ended December 31, 2024, the Company entered into a new lease agreement for office and laboratory space in Radnor, PA for the purpose of relocating its global headquarters. The lease for one portion of the laboratory space is expected to commence in the second quarter of 2026. The lease for the remaining portions of laboratory and office space is expected to commence upon the completion of the lessor owned leasehold improvements, which is expected to be in the second half of 2026. The lease agreement for the office and laboratory space is expected to expire during 2041. The cumulative future lease commitment for laboratory and office space is $79.7 million. The future lease commitments relating to this lease were not included in the lease liabilities balance as of December 31, 2025.

The components of the Company’s lease expense for the years ended December 31, 2025, 2024 and 2023 are as follows:

Supplemental cash flow information related to the Company’s leases is as follows:

Supplemental balance sheet information related to the Company’s leases is as follows:

Maturities of operating lease liabilities as of December 31, 2025 were as follows:

(1) The $79.7 million of future lease commitments for the office and laboratory lease expected to commence during 2026 were not included in the lease liabilities balance as of December 31, 2025.

Note 7 –Restructuring and Related Activities

In 2022, the Company initiated a global cost and optimization program to improve its cost structure and drive a more profitable and productive organization. As of December 31, 2025, the program included restructuring and associated severance costs to reduce headcount by approximately 440 positions globally. These actions are expected to be substantially complete by the end of 2026.

Employee separation benefits vary depending on local regulations across countries. The timing to finalize costs associated with all actions will depend on a number of factors and is subject to change. In addition to the global cost and optimization program described above, the Company continues to take actions to optimize its facility footprint. Restructuring costs incurred during the years ended December 31, 2025, 2024 and 2023 include employee severance and asset-related and facility closure costs, including non-cash asset write-offs, which are recorded in Restructuring and related charges, net in the Company’s Consolidated Statements of Operations.

Activity in the Company’s accrual for its restructuring program and facility closure actions for the years ended December 31, 2025 and 2024 are as follows:

In connection with the plans for closure of certain manufacturing and non-manufacturing facilities, the Company made available for sale certain facilities and properties. As of December 31, 2025, the Company classified properties in the Americas segment with an aggregate book value of approximately $1.2 million as held-for-sale. These assets are recorded in Prepaid expenses and other current assets in the Company’s Consolidated Balance Sheets. The Company expects to complete the sale of these properties over the next 12 months. During the years ended December 31, 2025, 2024 and 2023, the Company completed the sale of certain facilities previously classified as held-for-sale for a net gain of $2.2 million, $0.4 million and $1.4 million, respectively, which is recorded in Other (expense) income, net on the Consolidated Statements of Operations. The Company will continue to evaluate its existing facilities and footprint, which may include making other facilities or property available for sale in the future.

Note 8 –Equity

Share-based Compensation

The Company recognized the following share-based compensation expense in its Consolidated Statements of Operations for the years ended December 31, 2025, 2024 and 2023:

Before-tax share-based compensation expense is primarily included in SG&A in the Consolidated Statements of Operations. No cost was capitalized during the years ended December 31, 2025, 2024 and 2023.

Stock Options

Stock options granted under the LTIP program are subject to time vesting and generally become exercisable within three years after the date of the grant for a period of time determined by the Company, but not to exceed seven years from the date of grant. The Company has not granted stock options since fiscal year 2022. Share-based compensation for stock options is recognized using the graded vesting method over the vesting periods.

Stock option activity under all plans is as follows:

The total intrinsic value of stock options exercised during the years ended December 31, 2025, 2024 and 2023 were approximately less than $0.1 million, $0.1 million and $3.6 million, respectively. The intrinsic value is calculated as the difference between the current market price of the underlying security and the strike price of a related option.

As of December 31, 2025, all compensation expense related to outstanding stock options was recognized.

Restricted Stock Awards

RSAs granted under the LTIP program are subject to time vesting generally over aone tothree-year period. In addition, as part of the Company’s Annual Incentive Plan, non-vested shares may be issued to key employees, which generally would vest over a period oftwo-tofive-years. Share-based compensation for RSAs is recognized using the graded vesting method over the vesting periods.

Activity of restricted stock awards granted under the Company’s LTIP plan is shown below:

The fair value of the non-vested stock is based on the trading price of the Company’s common stock on the date of grant. As of December 31, 2025, unrecognized compensation expense related to these awards was $0.1 million, to be recognized over a weighted average remaining period of 0.2 years.

Restricted Stock Units

As a component of its LTIP, the Company granted RSUs subject to time vesting generally over aone tothree year period. Share-based compensation for time-based RSUs is recognized on a graded basis over the vesting periods.

Additionally, during the fourth quarter of 2024, the Company granted 9,820 time-based RSUs subject to a performance modifier based on the Company’s relative TSR compared to the S&P Composite 1500 Chemicals Index that vest on the third anniversary of the grant. The target number of RSUs that vest may range from 75% to 125% of the target number of RSUs depending on the achievement of the relative TSR performance criteria measured at the end of thethree-year performance period. Share-based compensation expense for these awards is recognized on a straight-line basis over the vesting period.

Activity of restricted stock units granted under the Company’s LTIP plan is shown below:

The fair value of the time-based non-vested RSUs is based on the trading price of the Company’s common stock on the date of grant. The fair value of RSUs subject to a performance modifier is valued using a Monte Carlo simulation on the grant date and used the following assumptions set below:

As of December 31, 2025, unrecognized compensation expense related to RSUs was $7.2 million, to be recognized over a weighted average remaining period of 1.4 years.

Performance Stock Units

The Company grants PSUs as a component of its LTIP and other equity compensation plans. The number of shares that may ultimately be issued as settlement for each award may range from 0% up to 200% of the target award, subject to the achievement of the Company’s market-based TSR relative to the performance of a selected peer group, and separately the achievement of a performance-based return on invested capital (“ROIC”) measure. The service period required for the PSUs is generally three years and the measurement period of the market-based and performance objectives is generally from January 1 of the year of grant through December 31 of the year prior to issuances of the shares. Share-based compensation for PSUs subject to time vesting is recognized on a straight-line basis over the vesting period.

As mentioned above, a portion of the Company’s PSUs are subject to achievement of the Company’s TSR relative to the performance of a selected peer group. For PSUs granted prior to 2024, the Company’s peer group was the S&P Midcap 400 Materials group. In 2024, the Company made an election to change peer groups to the S&P Composite 1500 Chemicals Index. For PSUs subject to relative TSR performance granted in 2024 and 2025, the peer group was the S&P Composite 1500 Chemicals Index.

Activity of performance stock units granted under the Company’s LTIP plan is shown below:

The fair value of PSUs granted with a ROIC condition is based on the trading price of the Company’s common stock on the date of grant. PSUs granted with a relative TSR condition are valued using a Monte Carlo simulation as of the grant date. The grant-date fair value of the PSUs valued using a Monte Carlo simulation included the following assumptions set forth in the table below:

As of December 31, 2025, there was approximately $6.0 million of total unrecognized compensation cost related to PSUs which the Company expects to recognize over a weighted-average period of 1.9 years.

2023 Director Stock Ownership Plan

In March 2023, the Company adopted the 2023 Director Stock Ownership Plan (the “Plan”), to encourage the Directors to increase their individual investment in the Company, which was approved at the Company’s May 2023 shareholders’ meeting. The Plan authorizes the issuance of up to 75,000 shares of Quaker common stock in accordance with the terms of the Plan in payment of all or a portion of the annual cash retainer payable to each of the Company’s non-employee directors in 2023 and subsequent years during the term of the Plan. Under the Plan, each director who, on May 1 of the applicable calendar year, owns less than 500% of the annual cash retainer for the applicable calendar year, divided by the average of the closing price of a share of Quaker Common Stock as reported by the composite tape of the New York Stock Exchange for the previous calendar year (the “Threshold Amount”), is required to receive 75% of the annual cash retainer in Quaker common stock and 25% of the retainer in cash, unless the director elects to receive a greater percentage of Quaker common stock, up to 100% of the annual cash retainer for the applicable year. Each director who owns more than the Threshold Amount may elect to receive common stock in payment of a percentage (up to 100%) of the annual cash retainer. The annual retainer is approximately $0.1 million and the retainer payment date is June 1.

Common Stock and Preferred Stock

The Company has 30,000,000 shares of common stock authorized with a par value of $1.00, and 17,331,779 and 17,673,607 shares issued and outstanding as of December 31, 2025 and 2024, respectively. The change in shares issued and outstanding during 2025 was primarily related to 364,797 shares repurchased by the Company under the share repurchase program as described below,12,182 shares surrendered from employees in payment of the vesting of restricted stock awards or units,2,617 shares forfeited by employees under equity compensation plans, offset by 37,768 share issuances relating to equity compensation plans.

The Company is authorized to issue 10,000,000 shares of preferred stock with a par value of $1.00, subject to approval by the Board. The Board may designate one or more series of preferred stock and the number of shares, rights, preferences, and limitations of each series. As of December 31, 2025, no preferred stock had been issued.

Share Repurchase Program

As previously disclosed, the Board of Directors of the Company has approved a share repurchase program (“2024 Share Repurchase Program”), authorizing the Company to repurchase up to an aggregate of $150 million of the Company’s outstanding common stock and replacing the prior share repurchase program. The 2024 Share Repurchase Program was effective immediately upon approval and has no expiration date. The number of shares to be repurchased and the timing of such transactions depends on a variety of factors, including market conditions. As of December 31, 2025, there was approximately $59.2 million of capacity remaining under the 2024 Share Repurchase Program. The Company repurchased 364,797 and 312,997 shares under the 2024 Share Repurchase Program for the year ended December 31, 2025 and 2024, respectively.

Under the 2024 Share Repurchase Program, the Company is authorized to repurchase shares through open market purchases, privately-negotiated transactions, accelerated share repurchases or otherwise in accordance with applicable federal securities laws, including through Rule 10b5-1 and under Rule 10b-18 of the Securities Exchange Act of 1934, as amended. The Company currently expects to employ trading plans for the repurchase of shares pursuant to the 2024 Share Repurchase Program, which would permit the Company to purchase shares, at predetermined price targets, when it may otherwise be precluded from doing so. The repurchases may be suspended or discontinued at any time. The specific timing and amount of repurchases will vary based on available capital resources and other financial and operational performance, market conditions, securities law limitations, and other factors.

Note 9 –Other (Expense) income, net

Other (expense) income, net for the years ended December 31, 2025, 2024 and 2023 are as follows:

Non-income tax refunds and other related credits includes $1.8 million of indirect tax credits and interest received during the year ended December 31, 2025 relating to the Brazil Supreme Court ruling in regard to certain non-income (indirect) taxes that have been previously charged and paid.

Foreign exchange losses, net, during the years ended December 31, 2025, 2024 and 2023, include foreign currency transaction losses of approximately $2.2 million, $0.8 million and $7.8 million, respectively, related to hyper-inflationary accounting. See Note 1, Basis of Presentation and Significant Accounting Policies, for additional information. Foreign exchange losses, net also includes a $1.4 million foreign exchange loss recognized during the year ended December 31, 2025 relating to the change in fair value of the foreign exchange forward contracts entered into in connection with the acquisition of Dipsol. See Note 24, Hedging Activities, for more information.

Gain on disposals of property, plant, equipment and other assets, net, includes gains recognized in 2025, 2024 and 2023 for the sale of certain property previously classified as held for sale. See Note 7, Restructuring and Related Activities, for more information.

Multiemployer plan withdrawal charge during the year ended December 31, 2025 represents a $0.9 million expense related to the Company withdrawing from the Cleveland Bakers and Teamsters Pension Fund, a multiemployer defined benefit pension plan, in connection with a site closure under the Company’s restructuring program and facility closure actions.

Business interruption insurance proceeds for the year ended December 31, 2024 reflects an insurance recovery of $1.0 million related to production losses due to an electrical fire in 2021 that resulted in temporary shutdown of production at one of the Company’s production facilities. See Note 25, Commitments and Contingencies, for additional discussion regarding the Company’s business interruption claims.

Product liability claim costs, net represents expense related to payments by the Company in connection with product liability disputes with customers, net of insurance recoveries during the year ended December 31, 2024.

Facility remediation recoveries, net, for the year ended December 31, 2023 reflects insurance recoveries of costs for remediation and restoration of property damage.

Note 10 –Income Taxes

On December 22, 2017, the U.S. government enacted comprehensive tax legislation which we refer to as U.S. Tax Reform. U.S. Tax Reform implemented a new system of taxation for non-U.S. earnings which eliminated U.S. federal income taxes on dividends from certain foreign subsidiaries and imposed a one-time transition tax on the deemed repatriation of undistributed earnings of certain foreign subsidiaries that is payable over eight years. Accordingly, the Company had initially recorded a $15.5 million transition tax liability for U.S. income taxes on undistributed earnings of non-U.S. subsidiaries. As of December 31, 2025, the $15.5 million transition liability has been fully paid. The Company may also be subject to other taxes, such as withholding taxes and dividend distribution taxes, if these undistributed earnings are ultimately remitted to the U.S.

On July 4, 2025, H.R. 1, commonly known as the One Big Beautiful Bill Act (the “OBBB”), was signed into law. The OBBB includes significant changes to the federal corporate tax provisions and extends certain otherwise expiring provisions of the 2017 Tax Cuts and Jobs Act. Among other things, the legislation restores 100% bonus depreciation for eligible property, reinstates expensing for domestic research and experimental expenditures, imposes new limitations on interest expense deductibility, and expands disallowed deductions for certain employee remuneration. The legislation has multiple effective dates, with certain provisions effective in 2025 and other provisions implemented through 2027. The provisions effective in 2025 do not have a material impact to our consolidated financial statements. The Company is continuing to evaluate the potential impacts of the provisions effective in 2026 and 2027.

Taxes on income before equity in net income of associated companies for the years ended December 31, 2025, 2024 and 2023 are as follows:

The components of income before taxes and equity of associated companies for the years ended December 31, 2025, 2024 and 2023 are as follows:

Total deferred tax assets and liabilities are composed of the following as of December 31, 2025 and 2024:

The Company’s net deferred tax assets and liabilities are classified in the Consolidated Balance Sheets as of December 31, 2025 and 2024 as follows:

As of December 31, 2025, the Company has a deferred tax liability of $8.5 million on certain undistributed foreign earnings, which primarily represents the Company’s estimate of the non-U.S. income taxes the Company will incur to ultimately remit certain earnings to the U.S. Otherwise, it is the Company’s current intention to reinvest its additional undistributed earnings of certain non-U.S. subsidiaries to support working capital needs and certain other growth initiatives outside of the U.S. The amount of such undistributed earnings at December 31, 2025 was approximately $429.2 million. Any tax liability which might result from ultimate remittance of these earnings is expected to be substantially offset by foreign tax credits (“FTCs”) (subject to certain limitations); however, certain withholding taxes could apply. It is currently impractical to estimate any such incremental tax expense.

The Company has $6.0 million of deferred tax assets related to state net operating losses. Management analyzed the expected impact of the reversal of existing taxable temporary differences, considered expiration dates, analyzed current state tax laws, and determined that $1.6 million of state net operating loss carryforwards is expected to be realized as a future benefit. Accordingly, a partial valuation allowance of $4.4 million has been established. These state net operating losses are subject to various carryforward periods of 5 years to 20 years or an indefinite carryforward period. An additional $0.9 million of valuation allowance was established for other net state deferred tax assets.

The Company has $26.6 million of deferred tax assets related to foreign net operating loss carryforwards. A partial valuation allowance of $3.7 million has been established against this amount resulting in a net $22.9 million expected future benefit. These foreign net operating losses are subject to various carryforward periods with the majority having an indefinite carryforward period. An additional partial valuation allowance of $3.7 million has been established against certain other foreign deferred tax assets.

FTCs may be carried forward for 10 years. Management analyzed the expected impact of the utilization of FTCs based on certain assumptions such as projected U.S. taxable income, overall domestic loss recapture, and applicable limitations if any. The Company had an FTCs carry forward of $23.1 million and $19.2 million as of December 31, 2025 and 2024, respectively, with a $20.6 million and $17.2 million valuation allowance as of December 31, 2025 and 2024, respectively, reflecting the amount of credits that are not expected to be utilized before expiration.

The following are the changes in the Company’s deferred tax asset valuation allowance for the years ended December 31, 2025, 2024 and 2023:

Payments for income taxes including withholding taxes, net for the year ended December 31, 2025 are as follows ($ in thousands):

(1) During the year ended December 31, 2025, there were no individual state jurisdictions with cash taxes paid that equaled or exceeded 5% of total income taxes paid.

Payments for income taxes including withholding taxes, net for the years ended December 31, 2024 and 2023 was $69.0 million and $68.6 million, respectively.

The following is a reconciliation of income taxes at the Federal statutory rate with income taxes recorded by the Company for the year ended December 31, 2025:

(1) During the year ended December 31, 2025, state taxes in Indiana, Pennsylvania, and Michigan comprised greater than 50% of the tax effect in this category.

The following is a reconciliation of income taxes at the Federal statutory rate with income taxes recorded by the Company for the years ended December 31, 2024 and 2023:

For the years ended December 31, 2025 and 2024, the Company’s cumulative liability for gross unrecognized tax benefits were $12.4 million and $13.9 million, respectively. For the years ended December 31, 2025 and 2024, the Company had accrued approximately $0.0 million and $0.8 million, respectively, for cumulative penalties and $1.8 million and $2.6 million, respectively, for cumulative interest.

The Company continues to recognize interest and penalties associated with uncertain tax positions as a component of tax expense on income before equity in net income of associated companies in its Consolidated Statements of Operations. The Company recognized a benefit of $0.8 million for penalties and a benefit of $0.8 million for interest (net of expirations and settlements) in its Consolidated Statements of Operations for the year ended December 31, 2025, a benefit of $0.2 million for penalties and a benefit of $0.2 million for interest (net of expirations and settlements) in its Consolidated Statement of Operations for the year ended December 31, 2024, and a benefit of $0.4 million for penalties and an expense of $0.1 million for interest (net of expirations and settlements) in its Consolidated Statement of Operations for the year ended December 31, 2023.

A reconciliation of the beginning and ending amounts of unrecognized tax benefits for the years ended December 31, 2025, 2024 and 2023, respectively, is as follows:

The amount of net unrecognized tax benefits above that, if recognized, would impact the Company’s tax expense and effective tax rate is $4.9 million, $8.3 million and $10.1 million for the years ended December 31, 2025, 2024 and 2023, respectively.

The Company and its subsidiaries are subject to U.S. Federal income tax, as well as the income tax of various state and foreign tax jurisdictions. Tax years that remain subject to examination by major tax jurisdictions are shown in the table below:

Positions challenged by the taxing authorities may be settled or applied by the Company.

Note 11 –Earnings Per Share

The following table summarizes earnings per share calculations for the years ended December 31, 2025, 2024 and 2023:

Certain stock options, restricted stock units and PSUs are not included in the diluted earnings per share calculation when the effect would be anti-dilutive. The number of anti-dilutive shares were 79,144,32,353, and 10,621 for the years ended December 31, 2025, 2024 and 2023, respectively.

Note 12 –Accounts Receivable and Allowance for Credit Losses

As of December 31, 2025 and 2024, the Company had gross trade accounts receivable totaling $432.1 million and $413.7 million, respectively. The following are changes in the allowance for credit losses during the years ended December 31, 2025, 2024 and 2023:

Note 13 –Inventories

Inventories as of December 31, 2025 and 2024 were as follows:

Note 14 –Property, Plant and Equipment

Property, plant and equipment as of December 31, 2025 and 2024 were as follows:

As of December 31, 2025 and 2024, PP&E includes $1.4 million and $1.0 million, respectively, of finance lease assets and future minimum lease payments. See Note 6, Leases, for additional information.

The Company recorded $30.4 million. $25.9 million, and $23.8 million of depreciation expense during the years ended December 31, 2025, 2024 and 2023, respectively.

Note 15 –Goodwill and Other Intangible Assets

Changes in the carrying amount of goodwill for the years ended December 31, 2025 and 2024 were as follows:

(1)During the year ended December 31, 2025, the Company finalized the working capital settlements which impacted the goodwill recorded. See Note 2, Business Combinations, for additional information.

(1) Accumulated impairment losses are attributable to the non-cash impairment charges of $88.8 million and $93.0 million to write down the carrying value of the EMEA reporting unit during the second quarter of 2025 and fourth quarter of 2022, respectively. These amounts include the impact of currency translation.

Gross carrying amounts and accumulated amortization for definite-lived intangible assets as of December 31, 2025 and 2024 were as follows:

The Company recorded $63.0 million, $58.2 million and $58.2 million of amortization expense during the years ended December 31, 2025, 2024 and 2023, respectively. Amortization expense is recorded within SG&A in the Company’s Consolidated Statements of Operations. Estimated annual aggregate amortization expense for the subsequent five years is as follows:

As of December 31, 2025 and December 31, 2024, the Company had indefinite-lived intangible assets for trademarks and tradenames totaling $201.2 million and $185.3 million, respectively.

The Company completes its annual goodwill and indefinite-lived intangible asset impairment tests during the fourth quarter of each year, or more frequently if triggering events indicate a possible impairment in one or more of its reporting units. During the second quarter of 2025, the Company concluded that the negative impacts of the lower than projected financial performance, driven by the continuation of soft end market conditions, as well as an increase in the Company’s cost of capital, driven by uncertainty around the potential negative impacts of tariffs, represented a triggering event for the Company’s EMEA reporting unit and the associated goodwill, as well as the related asset group. As a result of this conclusion, the Company completed an interim quantitative impairment assessment as of June 30, 2025 for its EMEA reporting unit and the related asset group. The Company concluded that the undiscounted cash flows exceeded the carrying value of the EMEA asset group, and therefore that the long-lived assets are not impaired. In completing a quantitative goodwill impairment test, the Company compares the reporting unit’s fair value, based on future discounted cash flows, to its carrying value in order to determine if an impairment of goodwill exists. The estimates of future discounted cash flows involve considerable judgment and are based upon certain significant assumptions including the weighted average cost of capital (“WACC”) as well as projected EBITDA, which includes assumptions related to revenue growth rates, gross margin levels and operating expenses. As a result of the impact of the uncertainty around tariffs, and continued soft end market conditions driving lower current year EMEA earnings and a decline in projected future EMEA earnings, as well as an increase in the WACC assumption utilized in the Company’s 2024 annual impairment assessment, the Company concluded that the estimated fair value of the EMEA reporting unit was less than its carrying value. As a result, a pre-tax, non-cash impairment charge of $88.8 million ($86.7 million after-tax) to write down the remaining carrying value amount of the EMEA reporting unit Goodwill was recorded in the second quarter of 2025, reflected in “Impairment charges” in the Consolidated Statements of Operations for the year ended December 31, 2025.

Note 16 –Investments in Associated Companies

As of December 31, 2025, the Company held a 50% investment in and had significant influence over Nippon Quaker Chemical, Ltd. (“Nippon Japan”), Kelko Quaker Chemical, S.A. (“Kelko Panama”) and Houghton Korea, held a 32% investment in and had significant influence over Primex, Ltd. (“Primex”), and a 30% investment in and had significant influence over Surteckariya (Thailand) Co., Ltd. (“SKT”), which was acquired as part of the Dipsol acquisition during the second quarter of 2025.

The carrying amount of the Company’s equity investments as of December 31, 2025 was $106.9 million, which includes investments of $65.6 million in Houghton Korea; $29.1 million in Primex; $6.7 million in Nippon Japan; $5.0 million in SKT, and $0.5 million in Kelko Panama. The carrying amount of the Company’s equity investments as of December 31, 2024 was $98.0 million, which includes investments of $66.3 million in Houghton Korea; $24.9 million in Primex; $6.3 million in Nippon Japan; and $0.5 million in Kelko Panama.

Dividends and distributions received from associated companies by investment were $8.8 million, $9.1 million, and $4.2 million in the years ended December 31, 2025, 2024 and 2023.

The following table is a summary of equity income in associated companies by investment for the years ending December 31, 2025, 2024 and 2023:

Note 17 –Other Non-Current Assets

Other non-current assets as of December 31, 2025 and 2024 were as follows:

As of December 31, 2025 and 2024, three and two of the Company’s foreign pension plans’ fair value of plan assets exceeded its gross benefit obligation, respectively, and were therefore over-funded for both years, which is presented within Pension assets in the table above. See Note 20 for additional information.

Note 18 –Other Accrued Liabilities

Other accrued liabilities as of December 31, 2025 and 2024 were as follows:

Note 19 –Debt

Debt as of December 31, 2025 and 2024 includes the following:

Credit facilities

During June 2022, the Company and its wholly owned subsidiary, Quaker Houghton B.V., as borrowers, Bank of America, N.A., as administrative agent, U.S. Dollar swing line lender and letter of credit issuer, Bank of America Europe Designated Active Company, as Euro Swing Line Lender, certain guarantors and other lenders entered into an amendment to its primary credit facility (the “Original Credit Facility”). The amended credit facility (“Credit Facility”) established (A) a new $150.0 million Euro equivalent senior secured term loan (the “Euro Term Loan”), (B) a new $600.0 million senior secured term loan (the “U.S. Term Loan”), and (C) a new $500.0 million senior secured revolving credit facility (the “Revolver”), each maturing in June 2027. The Company has the right to increase the amount of the Credit Facility by an aggregate amount not to exceed the greater of $300.0 million or 100% of Consolidated EBITDA, subject to certain conditions including the agreement to provide financing by any lender providing such increase.

The Company used the proceeds of the Credit Facility to repay all outstanding loans under the Original Credit Facility, unpaid accrued interest and fees on the closing date under the Original Credit Facility and certain expenses and fees. U.S. Dollar-denominated borrowings under the Credit Facility bear interest, at the Company’s election, at the base rate or term SOFR plus an applicable rate ranging from 1.00% to 1.75% for term SOFR loans and from 0.00% to 0.75% for base rate loans, depending upon the Company’s consolidated net leverage ratio. Loans based on term SOFR also include a spread adjustment equal to 0.10% per annum. Borrowings under the Credit Facility denominated in currencies other than U.S. Dollars bear interest at the alternative currency term rate plus the applicable rate ranging from 1.00% to 1.75%.

The Credit Facility contains affirmative and negative covenants, financial covenants and events of default, including without limitation restrictions on (a) the incurrence of additional indebtedness; (b) investments in and acquisitions of other businesses, lines of business and divisions; (c) the making of dividends or capital stock purchases; and (d) dispositions of assets. Dividends and share repurchases are permitted in annual amounts not exceeding the greater of $75 million annually and 25% of Consolidated EBITDA if there is no default. If the consolidated net leverage ratio is less than 2.50 to 1.00, then the Company is no longer subject to restricted payments.

Financial covenants contained in the Credit Facility include a consolidated interest coverage ratio test and a consolidated net leverage ratio test. The consolidated net leverage ratio at the end of a quarter may not be greater than 4.00 to 1.00, subject to a permitted increase during a four-quarter period after certain acquisitions. The Company has the option of replacing the consolidated net leverage ratio test with a consolidated senior net leverage ratio test if the Company issues certain types of unsecured notes, subject to certain limitations. Events of default in the Credit Facility include without limitation defaults for non-payment, breach of representations and warranties, non-performance of covenants, cross-defaults, insolvency, and a change of control in certain circumstances. The occurrence of an event of default under the Credit Facility could result in all loans and other obligations becoming immediately due and payable and the Credit Facility being terminated. As of December 31, 2025 and December 31, 2024, the Company was in compliance with all of the Credit Facility covenants.

The weighted average variable interest rate incurred on the outstanding borrowings under the Credit Facility during the twelve months ended December 31, 2025 was approximately 5.2%. As of December 31, 2025, the interest rate on the outstanding borrowings under the Credit Facility was approximately 4.7%. As part of the Credit Facility, the Company is required to pay an annual commitment fee ranging from 0.150% to 0.275% related to unutilized commitments under the Revolver, depending on the Company’s consolidated net leverage ratio. The Company had unused capacity under the Revolver of approximately $268.5 million, which is net of bank letters of credit of approximately $2.5 million, as of December 31, 2025.

In order to manage the Company’s exposure to variable interest rate risk associated with the Credit Facility, in the first quarter of 2023, the Company entered into $300.0 million notional amounts ofthree-year interest rate swaps to convert a portion of the Company’s variable rate borrowings into an average fixed rate obligation of 3.64% plus an applicable margin as provided in the Credit Facility based on the Company’s consolidated net leverage ratio. As of December 31, 2025, the aggregate interest rate on the swaps, including the fixed base rate plus the applicable margin, was 5.0%. See Note 24, Hedging Activities, for additional information.

The Company capitalized third-party and credit debt issuance costs attributed to the Euro Term Loan, U.S. Term Loan and Revolver during the second quarter of 2022. Capitalized costs attributed to the Euro Term Loan and U.S. Term Loan are recorded as a direct offset to Long-term debt on the Consolidated Balance Sheets. Capitalized costs attributed to the Revolver are recorded within Other assets on the Consolidated Balance Sheets. These capitalized costs are amortized into Interest expense over thefive year term of the Credit Facility. As of December 31, 2025 and 2024, the Company had $0.7 million and $1.1 million, respectively, of debt issuance costs recorded as a reduction of Long-term debt and $1.4 million and $2.4 million, respectively, of debt issuance costs recorded within Other assets.

Industrial development bonds

As of December 31, 2025 and 2024, the Company had fixed rate, industrial development authority bonds totaling $10.0 million in principal amount due in 2028. These bonds have similar covenants to the Credit Facility noted above.

Bank lines of credit and other debt obligations

The Company has certain unsecured bank lines of credit and discounting facilities in certain foreign subsidiaries, which are not collateralized. The Company’s other debt obligations primarily consist of certain domestic and foreign low interest rate or interest-free municipality-related loans, local credit facilities of certain foreign subsidiaries and finance lease obligations. Total unused capacity under these arrangements as of December 31, 2025, was approximately $57.4 million.

In addition to the bank letters of credit described in the “Credit facilities” subsection above, the Company’s other off-balance sheet arrangements include certain financial and other guarantees. The Company’s total bank letters of credit and guarantees outstanding as of December 31, 2025 were approximately $7 million.

The Company incurred the following debt related expenses included within Interest expense in the Consolidated Statements of Operations for the years ended December 31, 2025, 2024 and 2023:

Based on the variable interest rates associated with the Credit Facility, as of December 31, 2025 and 2024, the amounts at which the Company’s total debt were recorded are not materially different from their fair market value.

As of December 31, 2025, annual principal maturities on long-term borrowings, including the current portion, are as follows:

Note 20 –Pension and Other Postretirement Benefits

The following table shows the funded status of the Company’s plans’ reconciled with amounts reported in the Consolidated Balance Sheets as of December 31, 2025 and 2024:

The accumulated benefit obligation for all defined benefit pension plans was $204.8 million ($72.3 million U.S. and $132.5 million Foreign) and $199.9 million ($73.4 million U.S. and $126.5 million Foreign) as of December 31, 2025 and 2024, respectively.

Information for pension plans with an accumulated benefit obligation in excess of plan assets:

Information for pension plans with a projected benefit obligation in excess of plan assets:

Components of net periodic benefit costs – pension plans:

Other changes recognized in other comprehensive income – pension plans:

Components of net periodic benefit costs – other postretirement plan:

Other changes recognized in other comprehensive income – other postretirement benefit plans:

Weighted-average assumptions used to determine benefit obligations as of December 31, 2025 and 2024:

Weighted-average assumptions used to determine net periodic benefit costs for the years ended December 31, 2025, 2024 and 2023:

The long-term rates of return on assets were selected from within the reasonable range of rates determined by (a) historical real returns for the asset classes covered by the investment policy and (b) projections of inflation over the long-term period during which benefits are payable to plan participants. See Note 1, Basis of Presentation and Significant Accounting Policies, for additional information.

Assumed health care cost trend rates as of December 31, 2025, 2024 and 2023:

Plan Assets and Fair Value

The Company’s pension plan target asset allocation and the weighted-average asset allocations as of December 31, 2025 and 2024 by asset category were as follows:

As of December 31, 2025 and 2024, “Other” consisted principally of cash and cash equivalents, and investments in real estate funds.

The following is a description of the valuation methodologies used for the investments measured at fair value, including the general classification of such instruments pursuant to the fair value hierarchy, where applicable (refer to Note 1, Basis of Presentation and Significant Accounting Policies, for a definition of the levels of the fair value hierarchy):

Cash and Cash Equivalents

Cash and cash equivalents consist of cash and money market funds and are classified as Level 1 investments.

Commingled Funds

Investments in the U.S. pooled separate accounts consist primarily of mutual funds, each of which follows a separate investment strategy, and are valued based on the reported unit value at year end. Foreign pension plan commingled funds represent pooled institutional investments, including primarily collective investment trusts. These commingled funds are not available on an exchange or in an active market and these investments are valued using their net asset value (“NAV”), which is generally based on the underlying asset values of the investments held in the trusts. As of December 31, 2025, the foreign pension plan commingled funds included approximately 37 percent of investments in equity securities,48 percent of investments in fixed income securities, and 15 percent of other non-related investments, primarily real estate. As of December 31, 2024, the foreign pension plan commingled funds also included approximately 37 percent of investments in equity securities,48 percent of investments in fixed income securities, and 15 percent of other non-related investments, primarily real estate.

Pooled Separate Accounts

Investments in the U.S. pension plan pooled separate accounts consist of annuity contracts and are valued based on the reported unit value at year end. Units of the pooled separate account are not traded on an exchange or in an active market; however, valuation is based on the underlying investments of each pooled separate account and are classified as Level 2 investments. As of December 31, 2025, the U.S. pension plan pooled separate accounts included approximately 21 percent of investments in equity securities and 79 percent of investments in fixed income securities.

Fixed Income Government Securities

Investments in foreign pension plans fixed income government securities were valued using third party pricing services which are based on a combination of quoted market prices on an exchange in an active market as well as proprietary pricing models and inputs using observable market data and are classified as Level 2 investments.

Insurance Contract

The Company’s foreign pension plans invest in two separate insurance contracts. Investments in the first foreign pension plan insurance contract are valued at the highest value available for the Company at year end, either the reported cash surrender value of the contract or the vested benefit obligation. Both the cash surrender value and the vested benefit obligation are determined based on unobservable inputs, which are contractually or actuarially determined, regarding returns, fees, the present value of the future cash flows of the contract and benefit obligations.

Diversified Equity Securities - Registered Investment Companies

Investments in the foreign pension plans diversified equity securities of registered investment companies are based upon the quoted redemption value of shares in the fund owned by the plan at year end. The shares of the fund are not available on an exchange or in an active market; however, the fair value is determined based on the underlying investments in the fund as traded on an exchange in an active market and are classified as Level 2 investments.

Fixed Income – Foreign Registered Investment Companies

Investments in the foreign pension plans fixed income securities of foreign registered investment companies are based upon the quoted redemption value of shares in the fund owned by the plan at year end. The shares of the fund are not available on an exchange or in an active market; however, the fair value is determined based on the underlying investments in the fund as traded on an exchange in an active market and are classified as Level 2 investments.

Diversified Investment Fund - Registered Investment Companies

Investments in the foreign pension plan diversified investment fund of registered investment companies are based upon the quoted redemption value of shares in the fund owned by the plan at year end. This fund is not available on an exchange or in an active market and this investment is valued using its NAV, which is generally based on the underlying asset values of the investments held. There were no such investments as of December 31, 2025 and 2024.

Other – Alternative Investments

Investments in the foreign pension plans include certain other alternative investments such as inflation and interest rate swaps. These investments are valued based on unobservable inputs, which are contractually or actuarially determined, regarding returns, fees, the present value of future cash flows of the contract and benefit obligations. These alternative investments are classified as Level 3 investments.

Real Estate

The U.S. and foreign pension plans’ investment in real estate consists of investments in property funds. The funds’ underlying investments consist of real property which are valued using unobservable inputs. These property funds are classified as Level 3 investments.

As of December 31, 2025 and 2024, the U.S. and foreign plans’ investments measured at fair value on a recurring basis were as follows:

Certain investments that are measured at fair value using the NAV per share (or its equivalent) have not been classified in the fair value hierarchy. The fair value amounts presented for these investments in the preceding tables are intended to permit reconciliation of the fair value hierarchies to the line items presented in the statements of net assets available for benefits.

Changes in the fair value of the plans’ Level 3 investments during the years ended December 31, 2025 and 2024 were as follows:

The Company contributed to a multiemployer defined benefit pension plan under terms of a collective bargaining union contract (the Cleveland Bakers and Teamsters Pension Fund, Employer Identification Number: 34-0904419-001). As of December 31, 2024, the last valuation date available for the multiemployer plan, total plan liabilities were approximately $555 million. As of December 31, 2024, the multiemployer pension plan had total plan assets of approximately $350 million. The Company’s contribution rate to the multiemployer pension plan is specified in the collective bargaining union contract and contributions are made to the plan based on its union employee payroll. The Company contributed $0.1 million during the year ended December 31, 2025.

The Employee Retirement Income Security Act of 1974, as amended by the Multi-Employer Pension Plan Amendments Act of 1980, imposes certain contingent liabilities upon an employer who is a contributor to a multiemployer pension plan if the employer withdraws from the plan or the plan is terminated or experiences a mass withdrawal. In connection with a site closure under the Company’s restructuring program and facility closure actions, the Company withdrew from the multiemployer pension plan during the third quarter of 2025, which resulted in a $0.9 million withdrawal charge recorded within Other (expense) income, net. See Note 9, Other (Expense) Income, net, for additional information.

The Pension Protection Act of 2006 (the “PPA”) also added special funding and operational rules generally applicable to plan years beginning after 2007 for multiemployer plans with certain classifications based on a multitude of factors (including, for example, the plan’s funded percentage, cash flow position and whether the plan is projected to experience a minimum funding deficiency). The plan to which the Company contributes is in “critical” status. Plans in the “critical” status classification must adopt measures to improve their funded status through a funding improvement or rehabilitation plan which may require additional contributions from employers (which may take the form of a surcharge on benefit contributions) and/or modifications to retiree benefits. The amount of additional funds that the Company may be obligated to contribute to the plan in the future cannot be estimated as such amounts will be likely based on future levels of work that require the specific use of those union employees covered by the plan, and the amount of that future work and the number of affected employees that may be needed is not reasonably estimable.

Cash Flows

Contributions

The Company expects to make cash contributions of approximately $4.9 million to its pension plans (approximately $3.0 million U.S. and $1.9 million Foreign) and approximately $0.2 million to its other postretirement benefit plan in 2026.

Estimated Future Benefit Payments

Excluding any impact related to the PPA noted above, the following benefit payments, which reflect expected future service, as appropriate, are expected to be paid:

The Company maintains a plan under which supplemental retirement benefits are provided to certain officers. Benefits payable under the plan are based on a combination of years of service and existing postretirement benefits. Included in total pension costs are charges of $0.6 million each for the years ended December 31, 2025, 2024 and 2023, respectively, representing the annual accrued benefits under this plan.

Defined Contribution Plan

The Company sponsors various defined contribution plans in both its U.S. and non-U.S. subsidiaries, under which eligible participants may defer a portion of their compensation up to the allowable amount as determined by the plan. All contributions and Company matches are invested at the direction of the participant. The most significant plan is the Company's primary U.S. 401(k) plan with an employer match covering a majority of its U.S. employees. Beginning in April 2020 and continuing through March 2021, the Company matched both non-elective and elective 401(k) contributions in fully vested shared of the Company’s common stock rather than cash. See Note 8, Equity, for additional information. Total Company contributions under this U.S. 401(k) plan were $6.4 million, $6.6 million and $6.1 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Note 21 –Other Non-Current Liabilities

Other non-current liabilities as of December 31, 2025 and 2024 were as follows:

Note 22 –Accumulated Other Comprehensive Loss

The following table shows the reclassifications from and resulting balances of AOCI for the years ended December 31, 2025, 2024 and 2023:

(1) Includes mark-to-market impacts associated with net investment hedges. See Note 24, Hedging Activities, for more information.

All reclassifications related to Unrealized (loss) gain on available-for-sale securities relate to the Company’s equity interest in a captive insurance company and are recorded in Equity in net income of associated companies. The amounts reported in Other comprehensive income (loss) for non-controlling interest are related to currency translation adjustments.

Note 23 –Fair Value Measures

Fair value is defined as an exit price, or the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels as follows:

• Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.

• Level 2 - Inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the asset or liability.

• Level 3 - Inputs that are unobservable for the asset or liability based on our own assumptions about the assumptions market participants would use in pricing the asset or liability.

Refer to Note 24, Hedging Activities, for a description of the Company’s derivative instruments including the valuation techniques used to determine fair value and support for their classification within Level 2 of the fair value hierarchy.

The Company values its long-term debt at fair value based quoted market prices for the same or similar issues, or on current rates offered to the company for debt of the same remaining maturities and terms. Due to the infrequency of trades, these inputs are considered to be Level 2 inputs. Based on the variable interest rates associated with the Credit Facility, as of December 31, 2025 and 2024, the amounts at which the Company’s total debt were recorded are not materially different from their fair market value.

The Company values its company-owned life insurance policies at fair value based on quotes for like instruments with similar credit ratings and terms. As a result, the Company owns an immaterial remaining amount of company-owned life insurance policies as of the year ended December 31, 2025.

Items Measured at Fair Value on Nonrecurring Basis

The Company is also required to measure certain items, including intangible assets and goodwill, at fair value on a nonrecurring basis. For non-observable market values, the Company determines fair value using acceptable valuation principles, including the excess earnings, relief from royalty, lost profit, or cost methods. The determination of the estimated fair values of intangible assets and goodwill requires management’s judgment and involves the use of significant estimates and assumptions, including revenue growth rates, gross margin levels, operating expenses, the weighted average cost of capital (“WACC”), and royalty rates, among other items. See Note 15, Goodwill and Other Intangible Assets, for additional information.

Note 24 –Hedging Activities

The Company’s ongoing business operations expose it to various risks, including fluctuating foreign exchange rates and interest rate risk. To manage these risks, the Company periodically enters into derivative financial instruments, such as foreign exchange forward contracts, interest rate swap agreements, and cross-currency swap agreements. The Company does not hold or enter into derivative financial instruments for trading or speculative purposes.

Foreign Exchange Forward Contracts

The Company uses foreign exchange forward contracts to economically hedge the impact of the variability in exchange rates on certain assets and/or liabilities denominated in foreign currencies. These forward contracts are marked-to-market at each reporting date. Changes in the fair value of the underlying instrument and settlements are recognized in earnings in Other (expense) income, net. The fair value of the forward contract is determined from sources independent of the Company, including the financial institutions which are party to the derivative instruments.

Open foreign exchange forward contracts as of December 31, 2025 were entered into as hedges of Japanese yen and Mexican peso against the U.S. dollar and had the following notional U.S. dollar values:

In connection with the acquisition of Dipsol as described in Note 2, Business Combinations, in March 2025, the Company entered into multiple foreign exchange forward contracts with various financial institutions with an aggregate notional amount totaling $155.3 million to hedge the variability of exchange rate impacts between the U.S. Dollar and Japanese yen. These foreign exchange forward contracts settled on April 1, 2025. The Company recognized a $1.4 million foreign currency loss during the year ended December 31, 2025 in Other (expense) income, net relating to the change in fair value of these instruments as of the settlement date.

Open foreign exchange forward contracts as of December 31, 2025 had maturities occurring over a period ofone month.

Interest Rate Swaps

In order to manage the Company’s exposure to variable interest rate risk associated with the Credit Facility, such as the Secured Overnight Financing Rate (“SOFR”), in the first quarter of 2023, the Company entered into $300.0 million notional amounts ofthree year interest rate swaps to convert a portion of the Company’s variable rate borrowings into a fixed rate obligation. See Note 19, Debt, for additional information.

These interest rate swaps are designated as cash flow hedges and, as such, the contracts are marked-to-market at each reporting date and any unrealized gains or losses are included in AOCI to the extent effective and reclassified to interest expense in the period during which the hedged transaction affects earnings or it becomes probable that the forecasted transaction will not occur. Interest rate swaps are entered into with a limited number of counterparties within several tranches, each of which allows for net settlement of all contracts through a single payment to participating counterparties in a single currency in the event of a default or termination of any one contract. As such, in accordance with the Company’s accounting policy, these derivative instruments are recorded on a net basis within the Consolidated Balance Sheets.

Net Investment Hedges

In June 2025, the Company entered into a fixed-for-fixed cross currency swap for a notional amount of $75.0 million to hedge the variability of exchange rate impacts between the U.S. Dollar and the European euro. Under the terms of the cross-currency swap agreement, the Company notionally exchanged $75.0 million at an interest rate of 1.9% for 65.8 million EUR at an interest rate of 0.0%. The cross-currency swap is designated as a net investment hedge on a pre-tax basis and expires in June 2027.

In April 2025, the Company entered into fixed-for-fixed cross currency swaps with an aggregate notional amount totaling $100.0 million to hedge the variability of exchange rate impacts between the U.S. Dollar and Japanese yen. Under the terms of the cross-currency swap agreements, the Company notionally exchanged $100.0 million at a weighted average interest rate of 3.1% for 14.3 billion JPY at a weighted average interest rate of 0.0%. The cross-currency swaps are designated as net investment hedges on an after-tax basis and expire in April 2028.

The fixed-for-fixed cross-currency swaps are marked to market at each reporting date and any unrealized gains or losses are included in unrealized currency translation adjustments, within AOCI. The Company uses the spot method to evaluate the effectiveness of the net investment hedges.

The fair value of the Company’s interest rate swaps, forward exchange contracts, and cross-currency swap agreements are determined from sources independent of the Company, including the financial institutions which are party to the derivative instruments, using standard pricing models that consider the value of future cash flows as of the balance sheet date, discounted to a present value using discount factors that match both the time to maturity and currency of the underlying instruments. These standard pricing models utilize inputs that are derived from or corroborated by observable market data such as interest rate yield curves as well as currency spot and forward rates; therefore, the fair value of our derivatives is classified as a Level 2 measurement. The balance sheet classification and fair values of the Company’s derivative instruments are as follows:

The following table presents the net unrealized gain deferred to AOCI:

The following table presents the net gain (loss) recognized in the Company’s Consolidated Statements of Operations for the years ended December 31, 2025, 2024 and 2023:

Note 25 –Commitments and Contingencies

In the early 1990s, the Company identified certain soil and groundwater contamination at AC Products, Inc. (“ACP”), a wholly owned subsidiary. In voluntary coordination with the Santa Ana California Regional Water Quality Board, ACP has been remediating the contamination, the principal contaminant of which is perchloroethylene (“PERC”). In 2004, the Orange County Water District (“OCWD”) filed a civil complaint against ACP and other parties seeking to recover compensatory and other damages related to the investigation and remediation of the contamination in the groundwater. Pursuant to a settlement agreement with OCWD, ACP agreed, among other things, to operate the two groundwater treatment systems to hydraulically contain groundwater contamination emanating from ACP’s site until the concentrations of PERC released by ACP fell below the current Federal maximum contaminant level for four consecutive quarterly sampling events. In 2014, ACP ceased operation at one of its two groundwater treatment systems, as it had met the above condition for closure. In 2020, the Santa Ana Regional Water Quality Control Board asked that ACP conduct periodic indoor and outdoor soil vapor testing on and near the ACP site to confirm that ACP continues to meet the applicable local standards. ACP has performed such testing program work with an additional round of testing done in 2025. It is expected that additional testing may occur in 2026. As of December 31, 2025, ACP believes it has met the conditions for closure of the remaining groundwater treatment system but continues to operate this system while in discussions with the relevant authorities.

The Company’s Sao Paulo, Brazil site was required under Brazilian environmental, health and safety regulations to perform an environmental assessment as part of a permit renewal process. Initial investigations identified soil and ground water contamination in select areas of the site. The site has conducted a multi-year soil and groundwater investigation and corresponding risk assessments based on the result of the investigations. In 2017, the site had to submit a new 5-year permit renewal request and was asked to complete additional investigations to further delineate the site based on review of the technical data by the local regulatory agency, Companhia Ambiental do Estado de São Paulo (“CETESB”). Based on review of the updated investigation data, CETESB issued a Technical Opinion regarding the investigation and remedial actions taken to date. The site developed an action plan and submitted it to CETESB in 2018 based on CETESB requirements. The site intervention plan primarily requires the site, amongst other actions, to conduct periodic monitoring for methane in soil vapors, source zone delineation, groundwater plume delineation, bedrock aquifer assessment, update the human health risk assessment, develop a current site conceptual model and conduct a remedial feasibility study and provide a revised intervention plan. In 2020, the site submitted a report on the activities completed including the revised site conceptual model and results of the remedial feasibility study and recommended remedial strategy for the site. The site believes it will achieve the remedial objectives in June 2027, at which time a request for closure of the treatment system will be submitted.

The Company is also party to other environmental matters related to certain domestic and foreign properties. These environmental matters primarily require the Company to perform ongoing monitoring and maintenance at each of the applicable sites. During the year ended December 31, 2025, there have been no significant changes to the facts or circumstances of these matters. The Company had accrued obligations of $3.4 million and $3.6 million as of December 31, 2025 and 2024, respectively, for these environmental matters. These obligations are included in other accrued liabilities and other non-current liabilities on the Company’s Consolidated Balance Sheets. These accrued amounts are inclusive of the Brazilian environmental matter discussed below.

Other environmental matters include participation in certain payments in connection with four currently active environmental consent orders related to certain hazardous waste cleanup activities under the U.S. Federal Superfund statute. The Company has been designated a potentially responsible party (“PRP”) by the Environmental Protection Agency along with other PRPs depending on the site, and has other obligations to perform cleanup activities at certain other foreign subsidiaries. These environmental matters primarily require the Company to perform long-term monitoring as well as operating and maintenance at each of the applicable sites. The Company believes that it has made adequate accruals for costs associated with other environmental matters of which it is aware. Approximately $0.5 million and $0.6 million were accrued as of December 31, 2025 and 2024, respectively, to provide for such anticipated future environmental assessments and remediation costs.

The Company previously disclosed in its 2024 Form 10-K that one of its North American production facilities experienced an electrical fire in 2021 that resulted in property damage and the temporary shutdown of production. The Company and its insurance carrier reviewed the impact of the electrical fire on the production facility’s operations as it relates to a potential business interruption insurance claim. In July 2024, the Company and its insurance carrier settled this claim for $1.0 million.

The Company is party to other litigation which management currently believes will not have a material adverse effect on the Company’s results of operations, cash flows or financial condition. In addition, the Company has an immaterial amount of contractual purchase obligations.