DOW CHEMICAL CO /DE/

NOTE 4 –RESTRUCTURING AND ASSET RELATED CHARGES - NET

Charges for restructuring programs and other asset related charges, which include asset impairments, are recorded in "Restructuring and asset related charges - net" in the consolidated statements of income. For additional information on the Company's restructuring programs and other asset related charges, see Note 5 to the Consolidated Financial Statements included in the 2025 10-K.

Transform to Outperform

On January 26, 2026, the Dow Inc. Board of Directors ("Board") approved Transform to Outperform, a comprehensive set of actions designed to improve near-term Operating EBITDA by simplifying the Company's operating model, reducing its cost structure and delivering faster growth. The actions, which include a workforce reduction of approximately 4,500 roles, are expected to be substantially complete by the end of 2027. In the first quarter of 2026, the Company recorded pretax charges of $27 million for severance and related benefits costs, included in "Restructuring and asset related charges - net" in the consolidated statements of income, related to Corporate.

At March 31, 2026, $27 million of the Transform to Outperform reserve balance was included in "Accrued and other current liabilities" in the consolidated balance sheets.

2025 Restructuring Program

On January 27, 2025, the Board approved targeted actions to further achieve the Company's cost reduction initiatives in response to ongoing macroeconomic uncertainty, while reinforcing its long-term competitiveness across the economic cycle. These actions, which include a workforce reduction of approximately 1,500 roles, are expected to be substantially complete by the end of 2026.

On June 30, 2025, the Board approved restructuring actions to rationalize the Company's global asset footprint, including certain actions identified as part of the Company's previously announced strategic review of its European assets and certain corporate and other assets, and to enhance the Company's competitiveness over the economic cycle. The program includes asset write-down and write-off charges, severance and related benefit costs and other exit and disposal costs. The actions related to the shutdown of these assets are expected to be substantially complete by the end of 2027.

The following table summarizes the activities related to the 2025 Restructuring Program, including segment information:

1. Costs associated with exit and disposal activities relate to asset retirement obligations and pension benefit settlement costs.

At March 31, 2026, $57 million of the restructuring reserve balance was included in "Accrued and other current liabilities" ($123 million at December 31, 2025) and $137 million was included in "Other noncurrent obligations" ($140 million at December 31, 2025) in the consolidated balance sheets.

The Company recorded pretax restructuring charges of $862 million inception-to-date under the 2025 Restructuring Program, consisting of severance and related benefit costs of $389 million, asset write-downs and write-offs of $349 million and costs associated with exit and disposal activities of $124 million.

Restructuring implementation costs, primarily decommissioning and demolition activities related to asset actions and costs associated with the Company's restructuring actions, are expected to result in additional cash expenditures of approximately $200 million. Restructuring implementation costs totaled $21 million for the three months ended March 31, 2026 (zero for the three months ended March 31, 2025).