Qnity Electronics, Inc.

NOTE 5 -RELATED PARTY TRANSACTIONS

Historically, Qnity has been managed and operated in the normal course with other businesses of DuPont. Accordingly, certain shared costs have been allocated to Qnity and reflected as expenses in the stand-alone unaudited interim Combined Financial

Statements. Management considers the allocation methodologies used to be reasonable and appropriate reflections of the historical expenses attributable to Qnity for purposes of the interim stand-alone financial statements. The expenses reflected in the unaudited interim Combined Financial Statements may not be indicative of expenses that would be incurred by Qnity in the future. All related party transactions approximate prices at cost.

Corporate Expense Allocations

Qnity’s unaudited interim Combined Statements of Operations include general corporate expenses of DuPont for services provided by DuPont for certain support functions that are provided on a centralized basis. These costs were first attributed to Qnity if specifically identifiable to its businesses. If not specifically identifiable to Qnity’s businesses, these costs have been allocated using relevant allocation methods, primarily based on sales metrics, consistently for all periods presented.

Corporate expense allocations were recorded in the unaudited interim Combined Statements of Operations within the following captions:

Parent Company Equity

Net transfers from (to) Parent are included within Parent company net investment on the unaudited interim Combined Statements of Changes in Equity. The components of the net transfers from (to) Parent are as follows:

Refer to Note 10 for information on related party transactions with Qnity’s equity method investment entities.