What changed in this filing

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Item 1. Business

2024-02-23 compared with 2023-02-24 · 213 added, 208 removed, 430 unchanged (49% of the section changed)

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Sales and marketing are accomplished through our sales engineers while also using independent manufacturers' representatives and distributors as an extension of our sales capability.

On February 28, 2022, we acquired 100% of the outstanding shares of TEWA for $24,515.

TEWA is a designer and manufacturer of high-quality temperature sensors.

TEWA has complementary capabilities with our existing temperature sensing platform, and the acquisition supports our end market diversification strategy and expands our presence in Europe.

On June 30, 2022, we acquired 100% of the outstanding shares of Ferroperm for $72,340.

Ferroperm specializes in the design and manufacture of high performance piezoceramic components for use in complex and demanding medical, industrial, and aerospace applications.

Ferroperm has complementary capabilities with our existing medical diagnostics and imaging product lines.

The acquisition supports our end market diversification strategy and expands our presence in European end markets.

On February 6, 2023, we acquired 100% of the outstanding shares of maglab AG ("maglab") for $4,164 in cash subject to additional earnout payments based on future performance.

Maglab has deep expertise in magnetic system design and current measurement solutions for use in e-mobility, industrial automation, and renewable energy applications.

Maglab's domain expertise coupled with CTS’

commercial, technical and operational capabilities position us to advance our status as a recognized innovator in electric motor sensing and controls markets.

See the Consolidated Financial Statements and Notes included in Part II, Item 8 of this Annual Report on Form 10-K for financial information regarding the Company.

PRODUCTS BY MAJOR MARKETS

Our products perform specific electronic functions for a given product family and are intended for use in customer assemblies.

Our major products consist principally of sensors and actuators used in passenger or commercial vehicles, connectivity components used in telecommunications infrastructure, information technology and other high-speed applications, switches, temperature sensors, and potentiometers supplied to multiple markets, and fabricated piezoelectric materials and substrates used primarily in the medical, industrial, and aerospace and defense markets.

Our products perform specific electronic functions for a given product family and are intended for use in products assembled by our customers.

The following table identifies major products by industry.

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Switches, Transducers)

(EMI/RFI Filters, Capacitors, Frequency Control, Resistors,

(EMI/RFI Filters, Capacitors, Frequency Control Products, Resistors, RF filters)

(Piezo Microactuators, Rotary Actuators)

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The following table provides a breakdown of net sales by industry as a percent of consolidated net sales:

The following table provides a breakdown of net sales by end-market as a percent of consolidated net sales:

Transportation

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% of consolidated net sales

In the above table, previously reported Telecommunications & IT are included in the Industrial end-market for all periods presented.

In the above table, net sales to the telecommunications and information technology end markets are included in the industrial end-market for all periods presented.

The end-market sales for 2022 were adjusted by immaterial amounts to align the classification of certain customers in connection with our recent acquisitions with our enterprise-level end market information.

MARKETING AND DISTRIBUTION

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Approximately 91% of 2023 net sales were attributable to our sales engineers.

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Our sales engineers generally service our largest customers with application-specific products.

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conductive inks and contactors, passive connectivity components, integrated circuits and semiconductors, certain rare earth elements ("REEs"), ceramic powders, plastic components, molding compounds, printed circuit boards and assemblies, quartz blanks and crystals, wire harness assemblies, copper, brass, silver, gold, platinum, lead, aluminum, and steel-based raw materials and components.

These raw materials and parts are purchased from a number of suppliers, and we generally do not believe we are dependent upon one or a limited number of suppliers.

These raw materials and parts are purchased from a number of suppliers.

Although we purchase all of our semiconductors, REEs, conductive inks, and silver pastes from a limited number of suppliers, alternative sources are generally available.

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The price and availability of raw materials and manufactured components is subject to change due to, among other things, new laws and regulations, global economic and political events including strikes, and public health and safety concerns.

Due to the COVID-19 pandemic, we have experienced supply chain disruptions and inflationary pressures.

In particular, semiconductor and resin shortages have increased our material prices, and they have impacted our OEM customers’

ability to finish assembly of vehicles, which in turn have adversely impacted our results of operations and cash flows.

These pressures are expected to continue in fiscal 2023.

PATENTS, TRADEMARKS, AND LICENSES

We continue our practice of innovation and protect our intellectual property by obtaining patents in the U.S.

Our patents cover inventions relating to products that our engineers have designed, as well as for methods and technology related to our manufacturing processes.

We obtained 22 patents in 2022, including 7 U.S.

patents and 15 non-U.S.

We currently own 314

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patents worldwide including 132 active U.S.

We own 9 registered U.S.

trademarks, most of which are registered in jurisdictions throughout the world.

In 2023, CTS continued its practice of innovation and protecting its intellectual property by obtaining patents in the U.S.

CTS’s patents cover inventions relating to products that its engineers have designed, as well as for methods and technology related to CTS’s manufacturing processes.

CTS obtained 23 patents in 2023, including four U.S.

patents, 13 patents in Asia, and six patents in Europe.

CTS currently owns approximately 285 patents worldwide including 131 active U.S.

We own seven registered U.S.

trademarks, most of which are also registered in jurisdictions throughout the world.

We have also licensed certain patents and our license and royalty income for 2023 was less than 1% of net sales.

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Years Ended December 31,

Cummins, Inc.

Toyota Motor Corporation

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No other customer accounted for 10% or more of total net sales during these periods.

We continue to focus on broadening our customer base to diversify our end market exposure.

We continue to focus on broadening our customer base to diversify our exposure.

Changes in the level of our customers' orders have, in the past, had a significant impact on our operating results.

If a major customer reduces the amount of business it transacts with us, or substantially changes the terms of that business, there could be an adverse impact on our operating results.

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We compete with domestic and foreign manufacturers principally based on product features, technology, price, quality, reliability, delivery, and service.

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Some customers have reduced or plan to reduce their number of suppliers, while increasing their volume of purchases.

In certain other cases customers may choose to use multiple vendors to source products, which could impact our volumes and revenues.

Customers demand lower cost and higher quality, reliability, and delivery standards from us as well as from our competitors.

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operations, though substantial, are normal risks for global businesses.

These risks include currency controls and changes in currency exchange rates, longer collection cycles, political and transportation risks, economic downturns and inflation, government regulations, and expropriation.

These risks include currency controls and changes in currency exchange rates, longer collection cycles, political and fulfilment risks, economic downturns and inflation, government regulations, and expropriation.

See “Item 1A.

Risk Factors” for additional discussion of these and other risks that our business faces.

manufacturing facilities are located in China, Czech Republic, Denmark, Mexico, Philippines, Poland, and Taiwan.

Additional information regarding the Company’s sales by geographic area and long-lived tangible assets in different geographic areas is included in Note 20 - "Geographic Data" of this Annual Report on Form 10-K.

HUMAN CAPITAL MANAGEMENT AND OUR CULTURE

CTS is a leading provider of sensing and motion devices as well as connectivity components and we believe our employees are a critical asset to meeting our mission of enabling an intelligent and seamless world.

We take great pride in the products we build, and the manner

We take great pride in the products we build, and the manner in which we operate as a company and as individuals.

We work together, drawing on our strengths, guided by our culture, which is built on the following core values:

• Play to Win – being ambitious, seizing opportunities, challenging to get the best results, acting with humility, intelligence, and integrity

• Responsiveness – being nimble and acting fast, understanding customers’ needs, respecting the views and needs of others, working with a sense of urgency

• Simplicity – being straightforward, easy to deal with, reducing bureaucracy and complexity, delivering solutions efficiently and effectively

• Solution Oriented – staying curious and resourceful, understanding and embracing challenges, finding new and better ways to work together

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in which we operate as a company and as individuals.

We pull together, drawing on our strengths, guided by our culture which is built on our values.

Play to Win –

being ambitious, seizing opportunities, challenging to get best results, acting with humility, intelligence, and integrity

Responsiveness –

being nimble and acting fast, understanding customers’

needs, respecting the views and needs of others, working with a sense of urgency

Simplicity –

being straightforward, easy to deal with, reducing bureaucracy and complexity, delivering solutions efficiently and effectively

Solution Oriented –

staying curious and resourceful, embracing challenges, understanding the challenges, finding new and better ways to work together

We have a global business, and our employees reflect the diversity of our geographic footprint.

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North America

CTS is committed to fostering an environment where all employees are respected and treated equally.

Empowering our employees’

distinctive talents delivers customer value and advances our culture and engagement.

We strive to create an inclusive workplace where everyone feels valued, respected, appreciated, and embraced because of their differences –

a place where every employee can be themselves so they can reach their highest potential and help us achieve our business goals.

Our commitment to the aforementioned goals is evidenced through the formation and leadership from our global diversity council.

CTS strives to foster an environment where all employees are respected and treated equally.

Empowering our employees’ distinctive talents delivers customer value and advances our culture and engagement.

We strive to create an inclusive workplace where everyone feels valued, respected, appreciated, and embraced because of their differences – a place where every employee can be themselves so they can reach their highest potential and help us achieve our business goals.

Our employees must adhere to a Code of Ethics that sets standards for appropriate behavior.

We require annual training on preventing, identifying, reporting, and stopping any type of unlawful discrimination or unethical actions.

A copy of our Code of Ethics is available for review on our Company’s website, www.ctscorp.com.

We provide our employees with annual training on a variety of compliance-related topics including preventing, identifying and reporting any type of unlawful discrimination or unethical actions.

A copy of our Code of Ethics is available for review in the investors section of our Company’s website at https://investors.ctscorp.com.

We have developed key recruitment and retention strategies that guide our human capital management approach as part of the overall management of our business.

These strategies are advanced through a number of programs and initiatives outlined below:

We advance these strategies through a number of programs and initiatives including the following:

Talent Planning Process

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This includes the identification of key positions, assessment of internal talent and potential successors and plans for talent acquisition and development.

Each year, employees are expected to have defined performance objectives so that they focus time and resources appropriately, understand their impact to the success of our strategy, and know how their performance will be assessed.

On an annual basis managers complete a mid-year and year-end performance evaluation with their employees.

Each year managers are expected to complete a mid-year and year-end performance evaluations with their employees.

Employee Compensation

We strive to align compensation with the external market of companies from a similar industry or that are similarly sized and maintain equity within the organization.

We strive to align compensation with an external group of peer companies in our industry and/or similar to our size while also maintaining consistency and equity within our organization.

In addition, we offer a broad range of company-paid benefits, which we believe are competitive in our industry.

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Training and Development

Employee development and company growth goes hand in hand.

At CTS we focus our learning and development activities on areas that we believe will most effectively support the delivery of our business objectives.

Employee development and company growth go hand in hand.

At CTS, we focus our learning and development activities on areas that we believe will most effectively support the achievement of our business objectives.

In the competitive environment in which we operate, employees need to replenish their knowledge and acquire new skills to do their jobs better.

CTS provides growth and development

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opportunities through programs such as Education Reimbursement, Situational Leadership, Leadership Essentials, and the Accelerated Leadership Program.

CTS provides growth and development opportunities through programs such as Education Reimbursement, Situational Leadership, Leadership Essentials, and the Accelerated Leadership Program.

In addition, we have a mentorship program for key employees to leverage internal leadership and expertise.

Health and Safety

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Our health and safety activities are overseen by our corporate environmental, health and safety function and are managed by employees in our locations, who coordinate on-site safety programs, resources, reporting and training.

Our employees are regularly trained on safety-related topics, and we monitor and measure the effectiveness of our programs at all of our locations.

We recognize that we have a responsibility to be a positive influence in the communities in which we do business around the world, and CTS Cares is the platform which connects CTS employees to the causes that we care about.

We have a rich history of philanthropy and community involvement.

Our employees are regularly trained on safety-related topics, and we monitor and measure the effectiveness of our programs at our locations.

We recognize that we have a responsibility to be a positive influence in the communities in which we do business around the world, and CTS Cares is the platform that connects CTS employees to the causes that we care about.

We have a rich history of philanthropy and

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community involvement.

Our employees routinely leverage their individual skills and capabilities to give back to their local communities.

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Executive Officers.

The following serve as executive officers of CTS as of December 31, 2022.

The following persons serve as executive officers of CTS as of December 31, 2023.

Positions and Offices

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Vice President and Chief Financial Officer

Scott D’Angelo

Vice President, General Counsel and Secretary

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Senior Vice President

Kieran O’Sullivan –

President, Chief Executive Officer and Chairman of the Board.

O’Sullivan joined CTS on January 7, 2013.

Kieran O’Sullivan – 61 – President, Chief Executive Officer and Chairman of the Board.

O’Sullivan joined CTS on January 7, 2013.

Before joining CTS, Mr.

O’Sullivan served as Executive Vice President of Continental AG’s Global Infotainment and Connectivity Business and led the NAFTA Interior Division, having joined Continental AG, a global automotive supplier, in 2006.

O’Sullivan is a member of the board of directors of LCI Industries, a supplier of engineered components for manufacturers of recreational vehicles, manufactured homes, marine applications, and for the related aftermarkets, serving as the chairperson of the risk committee, and as a member of the corporate governance, nominating and sustainability and audit committees.

Ashish Agrawal –

Vice President and Chief Financial Officer.

Ashish Agrawal – 53 – Vice President and Chief Financial Officer.

On November 11, 2013, Mr.

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in various positions beginning in December 1994.

Scott D’Angelo –

Vice President, General Counsel and Secretary.

D’Angelo joined CTS in February 2021 and was elected General Counsel and Secretary on February 11, 2021.

Scott D’Angelo – 53 – Vice President, General Counsel and Secretary.

D’Angelo joined CTS in February 2021 and was elected General Counsel and Secretary on February 11, 2021.

Prior to joining CTS, Mr.

D’Angelo was a member of the International Commercial and Trade Practice Group of Baker McKenzie, LLP from March 2019, and served as Vice President, Deputy General Counsel & Chief Compliance Officer of Fortune Brands Home & Security, Inc., a leading home and security products company, from May 2015 and, prior to that, served in several senior roles with McDonald’s Corporation.

Martin Baumeister –

Senior Vice President.

Martin Baumeister – 57 – Senior Vice President.

Baumeister joined CTS on January 14, 2020.

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Baumeister served as Executive Director Electronics Americas when Continental separated that subsidiary into an independent entity from July 2018, and served as Executive Director - Global Customer Head from February 2015.

Mike Murray –

Senior Vice President, Mr.

Murray joined CTS on January 22, 2018.

Prior to joining CTS, Mr.

Murray gained global experience working and living in China and Hong Kong in senior roles at Laird PLC and Littelfuse, Inc.

Most recently, he served as Laird’s Vice President of Global Operations for the Performance Materials Business Unit beginning in January 2014.

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Information with respect to the Company’s Directors and corporate governance policies and practices may be found in our definitive proxy statement to be delivered to shareholders in connection with our 2023 Annual Meeting of Shareholders.

Such information is incorporated herein by reference.

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Our principal corporate office is located at 4925 Indiana Avenue, Lisle, Illinois 60532.

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Our internet address is www.ctscorp.com.

We make available free of charge through our website our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) of the Securities Exchange Act of 1934 as soon as reasonably practicable after we electronically file such material with, or furnish it to, the Securities and Exchange Commission ("SEC").

We make available free of charge through our website our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) of the Securities Exchange Act of 1934 (the "Exchange Act") as soon as reasonably practicable after we electronically file such material with, or furnish it to, the Securities and Exchange Commission ("SEC").

Other than the documents that we file with or furnish to the SEC that are incorporated by reference herein, the information contained on or accessible through our website is not part of this or any other report we file or furnish to the SEC.

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We generally receive volume estimates, but not firm volume commitments from our customers, and may experience reduced or extended lead times in customer orders.

Customers may cancel orders, change production quantities and delay production for a number of reasons.

Customers may cancel orders, change production quantities and delay production for a number of reasons including the use of additional suppliers.

Uncertain economic and geopolitical conditions may result in some of our customers delaying the delivery of some of the products we manufacture for them and placing purchase orders for lower volumes of products than previously anticipated.

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In addition, our customers may request that manufacturing of their products be transitioned from one of our facilities to another to achieve cost reductions and other objectives.

Such transfers may result in short term inefficiencies and costs due to resulting excess

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capacity and overhead at one facility and capacity constraints and the inability to fulfill all orders at another.

Such transfers may result in short-term inefficiencies and costs due to resulting excess capacity and overhead at one facility and capacity constraints and the inability to fulfill all orders at another.

In addition, we make key decisions based on our estimates of customer requirements, including determining the levels of orders that we will seek and accept, production schedules, component procurement commitments, personnel needs and other resource requirements.

Changes in demand for our customers’

products may reduce our ability to estimate future customer requirements accurately.

Changes in demand for our customers’ products may reduce our ability to estimate future customer requirements accurately.

This may make it difficult to schedule production and maximize utilization of our manufacturing capacity.

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We often increase staffing and capacity and incur other expenses to meet the anticipated demand of our customers, which causes reductions in our gross margins if customer orders are delayed or canceled.

On occasion, customers may require rapid increases in production, which may stress our resources and reduce margins.

On occasion, customers may require rapid increases in production, which may stress our

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resources and reduce margins.

We may not have sufficient capacity at any given time to meet our customers' demands.

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We compete around the world in various geographic regions and product markets.

Global economic and political conditions affect our business and the businesses of our customers, suppliers and consumers.

Global economic and political conditions affect our business and the businesses of our customers and suppliers.

Recessions, economic downturns, price instability, inflation, slowing economic growth and social and political instability in the markets where we compete could negatively affect our revenues and financial performance, and adversely impact our ability to grow or sustain our business.

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Our business, financial condition and results of operations could be adversely affected by disruptions in the global economy caused by the ongoing Russia-Ukraine conflict or other geopolitical tensions and conflict.

The ongoing conflict between Russia and Ukraine (which we refer to as the “Russia-Ukraine conflict”), has adversely affected the global economy, and the geopolitical tensions and conflicts it generates may continue to negatively impact our operations.

It has resulted in heightened economic sanctions from the U.S., the U.K., the European Union and the international community.

The ongoing conflict between Russia and Ukraine (which we refer to as the “Russia-Ukraine conflict”) has adversely affected the global economy, and the geopolitical tensions and conflicts it generates may continue to negatively impact our operations.

It has resulted in heightened economic sanctions from the U.S., the U.K., the European Union (the "E.U.") and the international community.

Even though we have no physical assets in Russia, the impact of the Russia-Ukraine conflict could have a material adverse effect on our business, financial condition, results of operations, supply chain, availability of critical supplies, intellectual property, partners, or customers.

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More broadly, there could be additional negative impacts to our financial results if the Russia-Ukraine conflict worsens, including, among other potential impacts, economic recessions in certain neighboring countries or globally due to inflationary pressures, including with respect to energy and supply chain cost increases or shortages, or the geographic proximity of the conflict relative to the rest of Europe.

Similar geopolitical tensions and political conflicts, including tensions between the U.S.

and China as well as between China and Taiwan, could adversely impact our employees, financial performance, and global operations, including by, among other things, jeopardizing the safety of our employees and facilities, disrupting our and our partners’

production, supply chain and logistics and communications, and causing market volatility, which could adversely impact our sales.

In addition, the effects of the ongoing Russia-Ukraine conflict as well as escalating tensions between China and Taiwan and other geopolitical conflicts could amplify or affect many of our other risks described elsewhere in Part I, Item 1A, "Risk Factors" in this Annual Report on Form 10-K.

Similar geopolitical tensions and political and/or armed conflicts, including tensions between the U.S.

and China, China and Taiwan, and the conflict between Israel and Palestine could adversely impact our employees, financial performance, and global operations, including by, among other things, jeopardizing the safety of our employees and facilities, disrupting our and our partners’ production, supply chain and logistics and communications, and causing market volatility, which could adversely impact our sales and/or amplify or affect many of our other risks described elsewhere in Part I, Item 1A, "Risk Factors" in this Annual Report on Form 10-K.

The impacts of supply chain constraints and inflationary pressures could adversely impact our operating results.

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We may be required to pay higher prices for raw materials or electronic components in short supply and order these raw materials or electronic components in greater quantities to compensate for variable delivery times.

We may also be required to pay higher prices for

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raw materials or electronic components due to inflationary trends regardless of supply, including the current high inflationary environment.

We may also be required to pay higher prices for raw materials or electronic components due to inflationary trends regardless of supply.

In addition, current proposed or future governmental policies may increase the risk of inflation, which could further increase the costs of raw materials and other components for our business.

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Similarly, if the costs of goods continue to increase, our suppliers may seek price increases from us.

If we are unable to mitigate the impact of these matters through price increases, cost savings to offset cost increases, hedging arrangements, or other measures, our results of operations and financial condition could be adversely impacted.

If we are unable to mitigate the impact of these matters through price increases, cost savings to offset cost increases, hedging arrangements, or other measures, our

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results of operations and financial condition could be adversely impacted.

If our competitors maintain or substantially lower their prices, we may lose customers and mark down prices.

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Factors negatively affecting the industries we serve and the demand for their products could negatively affect our business, financial condition and operating results.

Any adverse occurrence, including among others, industry slowdown, recession, public health crisis, political instability, costly or constraining regulations, increased tariffs, reduced government budgets and spending, armed hostilities, terrorism, excessive inflation, including the current high inflationary environment, prolonged disruptions in one or more of our customers' production schedules or labor disturbances, that results in a decline in the volume of sales in these industries, or in an overall downturn in the business and operations of our customers in these industries, could materially adversely affect our business, financial condition and operating results.

Any adverse occurrence, including among others, industry slowdown, recession, public health crisis, political instability, costly or constraining regulations, increased tariffs, reduced government budgets and spending, armed hostilities, terrorism, excessive inflation, prolonged disruptions in one or more of our customers' production schedules or labor disturbances, that results in a decline in the volume of sales in these industries, or in an overall downturn in the business and operations of our customers in these industries, could materially adversely affect our business, financial condition and operating results.

These industries may be unionized and some of our customers have experienced labor disruptions in the past.

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and local conditions and events that may affect our production volumes, such as labor conditions or political instability.

We may pursue acquisition opportunities that complement or expand our business as well as divestitures that could impact our business operations.

We may pursue acquisition opportunities that are intended to complement or expand our business as well as divestitures that could impact our business operations.

We may not be able to complete these transactions, and these transactions, if executed, may pose risks that could materially adversely affect our business, financial condition and operating results.

On an ongoing basis we explore opportunities to buy other businesses or technologies that could complement, enhance or expand our current business or product lines or that might otherwise offer us growth opportunities.

For example, during 2022, we acquired both TEWA Temperature Sensors SP.

(“TEWA”) and Meggitt A/S (a/k/a Ferroperm Piezoceramics A/S, “Ferroperm”).

We may have difficulty finding suitable opportunities or, if we do identify these opportunities, we may not be able to complete the transactions for any number of reasons including a failure to secure financing.

In addition, we may not be able to successfully or profitably integrate, operate, maintain and manage newly acquired businesses such as TEWA and Ferroperm, including their operations or employees.

For example, during 2022 and 2023, we acquired TEWA Temperature Sensors SP.

(“TEWA”), Meggitt A/S (a/k/a Ferroperm Piezoceramics A/S, “Ferroperm”) and maglab AG ("Maglab").

We may have difficulty finding suitable acquisition opportunities or, if we do identify these opportunities, we may not be able to complete the transactions for any number of reasons including a failure to secure financing.

In addition, we may not be able to successfully or profitably integrate, operate, maintain and manage newly acquired businesses such as TEWA, Ferroperm and Maglab, including their operations or employees.

Any transactions that we are able to identify and complete may involve a number of risks, including:

the diversion of management's attention

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from our existing business to integrate the operations and personnel of the acquired or combined business;

the diversion of management's attention from our existing business to integrate the operations and personnel of the acquired or combined business;

possible adverse effects on our operating results during the integration process;

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These and other factors could harm our ability to achieve anticipated levels of profitability from acquired operations or realize other anticipated benefits of an acquisition and could adversely affect our business and operating results.

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We have in the past, and may in the future, consider divesting certain business operations.

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As we grow our business, the risk of exposure to product liability litigation increases.

We may be required to participate in a recall involving

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products which are, or are alleged to be, defective.

We may be required to participate in a recall involving products which are, or are alleged to be, defective.

We carry insurance for certain legal matters involving product liability;

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We are subject to government regulations, including environmental, health, and safety laws and regulations, that expose us to potential financial liability.

Our operations are regulated by a number of federal, state, local and foreign government regulations, including those pertaining to environmental, health, and safety (“EHS”) that govern, among other things, air and water emissions, worker protection, and the handling, storage and disposal of hazardous materials.

Compliance with EHS laws and regulations is a major consideration for us because we use hazardous materials in our manufacturing processes.

If we violate EHS laws and regulations, we could be liable for substantial fines, penalties, and costs of mandated remedial actions and we could suffer reputational damages due to any such violations.

Compliance with EHS laws and regulations is a major consideration for us because we use

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hazardous materials in our manufacturing processes.

If we violate EHS laws and regulations, we could be liable for substantial fines, penalties, and costs of mandated remedial actions and we could suffer reputational damage due to any such violations.

Our environmental permits could also be revoked or modified, which could require us to cease or limit production at one or more of our facilities, thereby materially adversely affecting our business, financial condition and operating results.

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We have been notified by the U.S.

Environmental Protection Agency (the “EPA”), state environmental agencies and, in some cases, groups of potentially responsible parties, that we are potentially liable for environmental contamination at several sites currently and formerly owned or operated by us, including sites designated as National Priorities List sites under the EPA’s Superfund program.

Superfund liability is joint and several and we may be held responsible for more than our share of contamination at a site.

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In addition, changes to existing tax laws or the adoption of new tax laws, particularly in the U.S.

and EU, could have a material adverse impact to our effective tax rate and future cash tax liabilities.

and the E.U., could have a material adverse impact on our effective tax rate, future cash tax liabilities and the ability to utilize deferred tax assets.

The current economic and political environment may result in significant tax law changes in the numerous jurisdictions in which we operate.

In addition, our effective tax rate could be materially affected by certain tax proposals developed by the Organization for Economic Cooperation and Development and European Commission regarding the taxation of multinational businesses.

Adverse changes in the underlying profitability and financial outlook of our operations in several jurisdictions could lead to changes in our valuation allowances against deferred tax assets and other tax accruals that could materially and adversely affect our results of operations.

In addition, acquisitions or divestitures may cause our effective tax rate to change.

We base our tax positions upon the anticipated nature and conduct of our business and upon our understanding of the tax laws of the various countries in which we have assets or conduct activities.

However, our tax positions are subject to review and possible challenge by taxing authorities and to possible changes in law, which may have a retroactive effect.

Continued economic and political pressures to increase tax revenues in jurisdictions in which we operate, or the adoption of new or reformed tax legislation or regulation, may make resolving tax disputes more difficult.

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Given the wide range of international business relationships and the long-term nature and complexity of existing contractual agreements, differences arising between the actual results and assumptions made, or future changes to such assumptions, could necessitate future adjustments to tax income and expense already recorded.

Risks Related to Technology and Data Privacy

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Negative or unexpected tax consequences could adversely affect our results of operations.

We operate globally and changes in tax laws could adversely affect our results.

The international tax environment continues to change as a result of both coordinated actions by governments and unilateral measures enacted by individual countries, which could significantly impact our effective tax rate, tax liabilities, and ability to utilize deferred tax assets.

In addition, acquisitions or divestitures may cause our effective tax rate to change.

We base our tax positions upon the anticipated nature and conduct of our business and upon our understanding of the tax laws of the various countries in which we have assets or conduct activities.

However, our tax positions are subject to review and possible challenge by taxing authorities and to possible changes in law, which may have a retroactive effect.

We are exposed to, and may be adversely affected by, cybersecurity threats, incidents or other disruptions to our information technology systems and data.

We rely on our information technology systems and networks, including cloud-based systems, in connection with many of our business activities, some of which are managed directly by us, while others are managed by third-party service providers and are not under our direct control.

Our operations routinely involve receiving, storing, processing and transmitting information pertaining to our business, customers, suppliers, employees, and other operations.

We have both an increasing reliance on information technology systems and an increasing digital footprint as a result of changing technologies, connected devices and digital offerings, as well as expanded remote work policies.

If these technologies, systems, products or services are threatened, disputed, damaged, cease to function properly, are compromised due to employee or third-party contractor error, user error, malfeasance, system errors, or other vulnerabilities, or are subject to cybersecurity incidents, such as those involving denial of service attacks, ransomware, unauthorized access, malicious software, or other intrusions or disruptions, including by criminals, nation states or insiders, our business may be adversely impacted.

The impacts of any such circumstances could include production downtimes, operational delays, and other impacts on our operations and ability to provide products and services to our customers;

compromise of confidential, proprietary or otherwise protected information, including personal information and customer confidential data;

destruction, corruption, or theft of data or intellectual property;

manipulation, disruption, or improper use of these technologies, systems, products or services;

financial losses from fraudulent transactions, remedial actions, loss of business or potential liability;

adverse media coverage;

and legal claims or legal proceedings, including regulatory investigations, actions and fines;

and damage to our reputation and, as a result, have a material adverse effect on our business operations and financial performance.

Cybersecurity incidents could have a disruptive effect on our business.

From time to time, we and the service providers that we depend on to host our data and support our systems and business operations, are the target of, and periodically respond to, cybersecurity threats, including phishing and denial-of-service attacks, which, if successful, could result in a loss of business or customer information, systems interruption or the disruption of our operations.

The techniques that are used to obtain unauthorized access, disable or degrade service or sabotage systems and data change frequently, have continued to increase in recent years and such efforts may be difficult to detect for long periods of time.

As a result, we monitor our systems to protect our technology infrastructure and data.

In addition, we further attempt to mitigate these risks by employing a number of other measures, including employee training, a breach response plan, and maintenance of backup and protective systems.

Further, while we maintain insurance coverage that is intended to address certain aspects of cybersecurity risks, such insurance coverage may not cover all losses or all types of claims that arise.

Notwithstanding these measures, our systems, networks, products and services remain potentially vulnerable to known or unknown cybersecurity threats, any of which could have a material adverse effect on our business operations and financial performance.

We have in the past been subject to cybersecurity incidents which have not had a material impact on our business or financial condition and expect that we will be subject to additional cybersecurity incidents in the future.

We are exposed to risks and costs associated with complying with privacy laws and protecting personal data and other sensitive information.

We are subject to various risks and costs associated with the collection, handling, storage and transmission of information, including costs related to compliance with U.S.

and foreign data protection and privacy laws and other contractual obligations, as well as risks associated with the compromise of our systems collecting such information.

Many jurisdictions, including the E.U., the U.K., China and certain states within the U.S., have passed laws that require companies to meet specific requirements regarding the processing, use, and disclosure of personal data.

We collect internal and customer data and other information, including personally identifiable information for a variety of business purposes, including managing our workforce and providing requested products and services.

We could be exposed to investigations, fines, penalties, restrictions, litigation, reputational harm or other expenses, or other adverse effects on our business, due to failure to protect personal data or other sensitive information or failure to maintain compliance with the various U.S.

and foreign data collection and privacy laws or applicable data security standards.

Failure to keep pace with developments in technology could adversely affect our operations or competitive position.

The technologies and systems we use to operate our business may require refinements and upgrades, and third parties may cease support of systems that are currently in use.

The development and maintenance of these technologies may require significant investment by us.

As various systems and technologies become outdated or new technology is required, we may not be able to replace or introduce them as quickly as needed or in a cost-effective and timely manner.

As a result, our business operations could be disrupted and we could be exposed to cybersecurity threats, adversely affecting our business operations and financial performance.

Because third parties provide us with a number of operational and technical services, third-party cybersecurity incidents could expose us to liability, harm our reputation, damage our competitiveness and adversely affect our financial performance.

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Third parties provide us with certain operational and technical services.

These third parties may have access to our systems, provide hosting services, or otherwise process data about or on behalf of us, our employees or partners.

Any third-party cybersecurity incident could compromise the security, integrity or availability of or result in the theft, unauthorized access or processing, or disruption of access to data, which could negatively impact our operations.

We rely on the internal processes and controls of third-party software and application vendors to maintain the security of all software code, systems, and data provided to or used by or on behalf of the Company.

Any cybersecurity incidents involving third parties on which we rely could negatively affect our reputation, our competitive position and our financial performance, and we could face regulatory scrutiny, investigations, lawsuits and further potential liability .

Risks Related to Indebtedness and Financing

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The estimates and assumptions on which our financial projections are based may prove to be inaccurate, which may cause our actual results to materially differ from such projections, which may adversely affect our future profitability, cash flows and stock price.

Our financial projections, including any sales or earnings guidance or outlook we may provide from time to time, are dependent on certain estimates and assumptions related to, among other things, development and launch of innovative new products, market share projections, product pricing, sales, volume and product mix, foreign exchange rates and volatility, tax rates, interest rates, commodity prices, cost savings, accruals for estimated liabilities, including litigation reserves, and our ability to generate sufficient cash flow to reinvest in our existing business, fund internal growth, repurchase of our stock, make acquisitions, pay dividends and meet debt obligations.

Our financial projections, including any sales or earnings guidance or outlook we may provide from time to time, are dependent on certain estimates and assumptions related to, among other things, development and launch of innovative new products, market share projections, product pricing, sales, volume and product mix, foreign exchange rates and volatility, tax rates, interest rates, commodity prices, cost savings, accruals for estimated liabilities, including litigation reserves, and our ability to generate sufficient cash flow to reinvest in our existing business, fund internal growth, repurchase our stock, make acquisitions, pay dividends and meet debt obligations.

There is no assurance that we will fully realize the anticipated cost savings and other benefits of our restructuring activities in the time frames we desire or at all.

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Any material variation between our financial projections and our actual results may adversely affect our future profitability, cash flows and stock price.

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Risks Related to COVID-19 Pandemic and Other External Factors

Public health issues such as the COVID-19 pandemic have adversely affected, and could in the future, adversely affect our business or financial results.

Any outbreaks of contagious diseases and other adverse public health developments in countries where we operate could have a material and adverse effect on our business, operations, financial condition, liquidity and results of operations.

For example, the COVID-19 pandemic has affected our offices and manufacturing facilities throughout the world, as well as the facilities of our suppliers, customers and their customers for the past several years.

As of December 31, 2022, we continue to experience some disruptions, mainly to our operations in China.

The extent to which the COVID-19 pandemic will continue to impact our business and financial results going forward will be dependent on future developments such as any additional future resurgences from known or new variants, future government regulations and actions in response to the crisis, the timing, availability, effectiveness and adoption rates of vaccines and treatments, and the overall impact of the COVID-19 pandemic on the global economy and capital markets, among many other factors, all of which remain highly uncertain and unpredictable.

Given these uncertainties, we expect the pandemic to continue to have an impact on our business, operations, financial condition, liquidity and results of operations in 2023 and potentially beyond.

There can be no assurance that the COVID-19 pandemic will not have a material and adverse effect on our business, operations, financial condition, liquidity and results of operations in the future.

Risks Related to Other External Factors

Loss, operational disruptions or closure of a key facility, including those of our suppliers, due to unforeseen or catastrophic events or otherwise, could have a material adverse effect on our business and financial results.

Our business could be interrupted and our financial results could be materially adversely impacted by physical risks such as earthquakes, fires, hurricanes, floods, acts of war, terrorist attacks, cyberattacks and other disruptions in information systems, disease outbreaks or pandemics, and other natural disasters or catastrophic events that damage, disrupt or destroy one of our key facilities or the key facilities of our significant suppliers.

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pandemics, and other natural disasters or catastrophic events that damage, disrupt or destroy one of our key facilities or the key facilities of our significant suppliers.

If any of our key facilities or the key facilities of our significant suppliers experience a significant operational disruption or catastrophic loss, it could delay, disrupt or reduce production, shipments and revenue, and result in potentially significant expenses to repair or replace these properties.

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The effects of climate change and the ongoing efforts to mitigate its impact, including through climate change-related legislation and regulation, could have a material adverse effect on our business, financial condition, and results of operations.

The physical effects of climate change, including extreme weather and natural disasters (including those risks discussed under the heading “

In addition, changes to laws or regulations enacted to address the potential impacts of climate change could have a material

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adverse impact on our business, financial condition, and results of operations.

The physical effects of climate change, including extreme weather and natural disasters (including those risks discussed under the heading “ Loss, operational disruptions or closure of a key facility, including those of our suppliers, due to unforeseen or catastrophic events or otherwise, could have a material adverse effect on our business and financial results ”) may disrupt our operations and those of our customers and suppliers.

In addition, changes to laws or regulations enacted to address the potential impacts of climate change could have a material adverse impact on our business, financial condition, and results of operations.

For example, continuing political and social attention to the issue of climate change has resulted in both existing and pending international agreements and national, regional, or local legislation and regulatory measures to limit greenhouse gas emissions.

Any future increased regulation concerning greenhouse gas emissions and other climate-change related laws and regulations, may require equipment modifications, operational changes, payment of increased or additional taxes, or the purchase of emission credits to reduce the emission of greenhouse gases from our operations, which may result in us incurring substantial capital expenditures and compliance, operating, maintenance and remediation costs.

In addition, any such future regulatory changes could result in transition risks to our business, including but not limited to (i) the nature and timing of any requirement to lower greenhouse gas emissions and adopt more energy-efficient energy use, which could result in changes or disruptions to the way we operate our business, (ii) the risk of lower demand for our products related to customers who experience business declines or disruptions due to the impact of any requirement to lower greenhouse gas emissions, (iii) financial risks where compliance with such regulations requires unforeseen capital expenditures, (iv) legal risks associated with the implementation of any new technologies required to comply with such regulations, which could impede our ability to innovate new products, meet customer and market demand or compete on pricing and quality in the market, and/or (v) reputational risks associated with our customers’

and investors’

perceptions of our business.

We are not able to predict how any future definitive agreements, pacts and/or regulations, if and when they are adopted and required, and the commitments necessary to comply with such requirements, will affect our business, financial condition, and results of operations.

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Unfavorable outcomes of legal or regulatory matters may adversely affect our business and financial condition and damage our reputation.

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We are from time to time involved in or subject to a variety of litigation, claims, legal or regulatory proceedings or matters related to our business, warranty claims, our intellectual property rights, alleged infringement or misappropriation by us of intellectual property rights of others, tax, environmental, privacy, insurance, ERISA and employment matters.

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The assessment of the outcome of such matters, including our potential liability, if any, is a highly subjective process that requires judgments about future events that are not within our control and are based on the information available to management at that time.

The outcome of such matters, including amounts ultimately received or paid upon judgment or settlement, may differ materially from management’s outlook or estimates, including any amounts accrued in the financial statements.

Actual outcomes, including judgments, awards, settlements or orders, could have a material adverse effect on our business, financial condition, operating results, or cash flows and damage our reputation.

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Public health or safety concerns and governmental restrictions that impact the availability of raw materials, labor, or the movement of goods in some of the countries in which we operate could have a material adverse effect on our business, financial condition, and operating results.

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We are exposed to fluctuations in foreign currency exchange rates that may adversely affect our business, financial condition and operating results.

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Our inability to protect our intellectual property rights could diminish or eliminate the competitive advantages that we derive from our technology, cause us to lose sales or otherwise harm our business.

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We believe that patents will continue to play an important role in our business.

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The labor market for many of our employees is very competitive, and wages and compensation costs continue to increase.

Our ability to attract and retain key talent has been, and may continue to be, impacted by challenges in the labor market, particularly in the U.S., which has recently been experiencing wage inflation, labor shortages, a continued shift toward remote work.

If we face labor shortages and/or increased labor costs as a result of increased competition for employees, higher employee turnover rates, or increases in employee benefits costs, our operating expenses could increase, which could negatively impact our growth and results of operations.

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We are subject to the ongoing internal control provisions of Section 404 of the Sarbanes-Oxley Act of 2002 ("Sarbanes-Oxley").

Our controls necessary for continued compliance with Sarbanes-Oxley may not operate effectively or at all times and may result in a material

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Our controls necessary for continued compliance with Sarbanes-Oxley may not operate effectively or at all times and may result in a material weakness.

The identification of material weaknesses in internal control over financial reporting could indicate a lack of proper controls to generate accurate financial statements.

Further, the effectiveness of our internal controls may be impacted if we are unable to retain sufficient skilled finance and accounting personnel, especially in light of the increased demand for such personnel among publicly traded companies.

Global privacy, data protection and data security laws are highly complex, evolving rapidly, and may increase our costs to comply.

To conduct our operations, we may need to move data across national borders, and consequently we are subject to a variety of continuously evolving and developing laws and regulations in the U.S.

and abroad regarding privacy, data protection and data security ("Data Protection Laws").

Data Protection Laws typically impose significant requirements and additional obligations for companies on how they collect, process and transfer personal data by enacting consumer privacy rights and imposing significant fines for non-compliance.

The potential for fines and other related costs in the event of a breach of or non-compliance with existing or proposed Data Protection Laws may have an adverse effect on our financial results.

Further, the regulatory framework around data custody, data privacy and breaches vary by jurisdiction and is an evolving area of law.

We may not be able to limit our liability or damages in the event of such a loss.

We are exposed to, and may be adversely affected by, potential security breaches or other disruptions to our information technology systems and data security.

Our operations routinely involve receiving, storing, processing and transmitting sensitive information pertaining to our business, customers, suppliers, employees, and other sensitive matters.

We have both an increasing reliance on IT systems and an increasing digital footprint as a result of changing technologies, connected devices and digital offerings, as well as expanded remote work policies.

If these technologies, systems, products or services are damaged, cease to function properly, are compromised due to employee or third-party contractor error, user error, malfeasance, system errors, or other vulnerabilities, or are subject to cybersecurity attacks, such as those involving denial of service attacks, unauthorized access, malicious software, or other intrusions, including by criminals, nation states or insiders, our business may be adversely impacted.

The impacts of any such circumstances could include production downtimes, operational delays, and other impacts on our operations and ability to provide products and services to our customers;

compromise of confidential, proprietary or otherwise protected information, including personal information and customer confidential data;

destruction, corruption, or theft of data or intellectual property;

manipulation, disruption, or improper use of these technologies, systems, products or services;

financial losses from fraudulent transactions, remedial actions, loss of business or potential liability;

adverse media coverage;

and legal claims or legal proceedings, including regulatory investigations, actions and fines;

and damage to our reputation.

There has been a rise in the number of cyberattacks targeting confidential business information generally and in the manufacturing industry specifically.

Moreover, there has been a rise in the number of cyberattacks that depend on human error or manipulation, including phishing attacks or schemes that use social engineering to gain access to systems or perpetrate wire transfer or other frauds.

Furthermore, geopolitical turmoil has heightened the risk of cyberattacks.

These trends increase the likelihood of such events occurring as well as the costs associated with protecting against such attacks.

It is possible for vulnerabilities in our IT systems to remain undetected for an extended period of time up to and including several years.

We, and the service providers that we depend on to support our systems and business operations, are regularly the target of, and periodically respond to, cyberattacks, including phishing and denial-of-service attacks.

As a result, we continuously monitor our systems to protect our technology infrastructure and data from misappropriation or corruption.

In addition, we further attempt to mitigate these risks by employing a number of other measures, including employee training, a breach response plan, and maintenance of backup and protective systems.

Further, while we maintain insurance coverage that is intended to address certain aspects of cybersecurity risks, such insurance coverage may not cover all losses or all types of claims that arise.

Notwithstanding those measures, our systems, networks, products and services remain potentially vulnerable to known or unknown cybersecurity attacks and other threats, any of which could have a material adverse effect on our financial results.

Environmental, social, and governance ("ESG") issues, including those related to climate change and sustainability, may have an adverse effect on our business, financial condition and results of operations and damage our reputation.

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In particular, investor advocacy groups, institutional investors, stockholders, employees, consumers, customers, regulators, proxy advisory services and other market participants have increasingly focused on ESG practices and policies of companies, including sustainability performance and risk mitigation efforts, and their effect on companies from an investor, consumer, customer or employee perspective.

If our ESG practices do not meet investor or other stakeholder expectations

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and standards or evolving regulatory requirements, our stock price, sales, ability to access capital markets, reputation and employee retention, among other things, may be negatively affected.

If our ESG practices do not meet investor or other stakeholder expectations and standards or evolving regulatory requirements, our stock price, sales, ability to access capital markets, reputation and employee retention, among other things, may be negatively affected.

Shareholder activism efforts or unsolicited offers from a third-party could cause a material disruption to our business and financial results.

We may be subject to various legal and business challenges due to actions instituted by shareholder activists or an unsolicited third-party offer.

Perceived uncertainties as to our future direction as a result of shareholder activism may lead to the perception of a change in the direction of the business or other instability and may affect our relationships with vendors, customers, prospective and current employees and others.

Perceived uncertainties as to our future direction as a result of shareholder activism may lead to the perception of a change

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in the direction of the business or other instability and may affect our relationships with vendors, customers, prospective and current employees and others.

Proposed or future laws and regulations may increase the chance we become the target of shareholder activist campaigns, including ESG-related actions.

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Dividends are declared at the discretion of our Board of Directors, and future dividends will depend on our future earnings, cash flow, financial requirements and other factors.

Our ability to pay cash dividends on our common stock is limited under the terms of our credit agreements.

Under the most restrictive terms of our credit agreements, our ability to pay cash dividends on our common stock is limited, as described under “Risks Related to Indebtedness and Financing.”

There can be no assurance that we will continue to pay dividends in the future.

Under the most restrictive terms of our credit agreements, our ability to pay cash dividends on our common stock is limited, as described under “Risks Related to Indebtedness and Financing.” There can be no assurance that we will continue to pay dividends in the future.

We may not continue to repurchase our common stock or make repurchases our common stock at favorable prices.

In February 2024, our Board of Directors approved a new share repurchase program that authorizes the Company to repurchase up to $100 million of its common stock.

Any purchases will depend on a number of factors, including our evaluation of general market and economic conditions, our financial condition and the trading price of our common stock.

The repurchase program may be extended, modified, suspended or discontinued at any time.

A reduction in, or the completion of, our repurchase program could have a negative effect on our stock price.

We can provide no assurance that we will repurchase our common stock at favorable prices, or at all.

On August 16, 2022, the Inflation Reduction Act of 2022 (“Inflation Reduction Act”) was enacted.

The Inflation Reduction Act imposes on publicly-traded companies a new, nondeductible excise tax equal to 1% of the fair market value of any stock of a company that is repurchased after December 31, 2022, during its taxable year.

Because this excise tax would be payable by us, and not by a redeeming holder, the imposition of this excise tax could cause a reduction in the cash available on hand to implement the repurchase program.

Unresolv ed Staff Comments

Cybersecurity

Risk Management and Strategy

The Company’s cybersecurity risk management strategy is comprised of several key elements.

We assess our information technology and data management/storage systems and related policies and practices and to help guide and prioritize our cybersecurity and information technology-related investments, activities and risk management strategy.

We leverage a variety of technologies to attempt to mitigate the risk of cybersecurity threats and incidents.

The Company has a multi-layer approach to its technology solutions, including employing applications used for perimeter, network, end point and application security as well as for data recovery, in each case tailored to the Company’s systems, data, risk profile and mitigation strategy.

From time to time we use third-party service providers and software to augment and test our technology solutions and further support our risk mitigation strategy.

We have a cybersecurity training program that covers a variety of topics designed to educate our employees about the importance of cybersecurity awareness, highlight typical cybersecurity-related risks and issues (such as phishing attacks and other methods used to attempt to infiltrate our systems) and test that awareness using knowledge assessments and simulations.

The training is administered to employees on a rolling basis, and we use a third-party provider for the content periodically update the training to incorporate new cybersecurity-related developments.

The oversight of our cybersecurity risk is integrated into our enterprise-wide risk management process.

We annually review cybersecurity risk as part of our enterprise risk management process and evaluate whether to integrate those findings into our overall cybersecurity strategy.

We have a Cybersecurity Strategy Committee, which is a cross-functional team of business representatives led by our Vice President of IT & Digitization, which is responsible for spearheading the ongoing development and execution of our cybersecurity strategy.

The Cybersecurity Strategy Committee meets regularly and at other times as needed, and periodically updates the Company’s management on its progress and activities.

Like many other companies, from time to time, we detect attempts by third parties to gain access to our systems and networks, and the frequency of such attempts could increase in the future.

As of the date of this Annual Report on Form 10-K, we are not aware of any cybersecurity threats that have materially affected or are reasonably likely to materially affect the Company, including its business strategy, results of operations or financial condition.

However, there can be no assurance that our efforts to prevent or mitigate

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cybersecurity incidents will be successful.

Please see “Risks Related to Technology and Data Privacy” in “Risk Factors” in Section 1A of this Annual Report on Form 10-K.

Our cybersecurity program is overseen by a Vice President of IT & Digitization and information technology team (collectively, the “IT Team”) responsible for identifying, assessing, monitoring, managing and communicating the Company’s cybersecurity risks.

The IT team includes members with experience developing and implementing enterprise-wide cybersecurity strategies and initiatives, managing risks relating thereto, and evaluating industry standards and regulations.

While our Board has the ultimate oversight responsibility for the risk management process, the Audit Committee is responsible for oversight of our cybersecurity strategy and risks.

The Audit Committee is provided with quarterly and as needed updates on the Company’s cybersecurity strategy and risks.

In addition, the Board is provided with an annual cybersecurity update that addresses similar topics to those discussed with the Audit Committee on a quarterly basis.

In the event of a reported potential cybersecurity incident, our IT Team decides whether such incident triggers our Cybersecurity Threat Evaluation and Response Plan (the “Response Plan”).

If triggered, the Company’s cybersecurity response team, as needed under the circumstances (the “Cyber Response Team”), is convened.

Members of the Cyber Response Team, as appropriate and as set forth in the Response Plan, are responsible for developing, recommending and implementing measures to address the cybersecurity incident, including when appropriate, assessing, containing and mitigating its impact, notifying members of the Company’s management, the Audit Committee and the full Board of the cybersecurity incident, and coordinating external communications, in each case as appropriate under the circumstances.

The IT Team is responsible for implementing and monitoring the effectiveness of any remediation plan adopted as a result of the cybersecurity incident.

As of December 31, 2023, we had manufacturing facilities, administrative, research and development and sales offices in the following locations:

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Calamba, Philippines

Hopkinton, Massachusetts

Juarez, Mexico

Kaohsiung, Taiwan

Kvistgaard, Denmark

Leczna, Poland

Lisle, Illinois

Lublin, Poland

Matamoros, Mexico

Tecate, Mexico

Matamoros, Mexico

Tecate, Mexico

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Zhongshan, China

Lublin, Poland

Leczna, Poland

Total manufacturing

(1) Ground lease through 2026;

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Office and Warehouse

Matamoros, Mexico

Warehouse and administrative offices

Elkhart, Indiana

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Elkhart, Indiana

Administrative offices and research

Administrative and research offices

Farmington Hills, Michigan

Hopkinton, Massachusetts

Idle facility

Juarez, Mexico

Idle facility

Kaohsiung, Taiwan

Administrative offices and research

Administrative and research offices

Lisle, Illinois

Administrative offices and research

Administrative and research offices

Matamoros, Mexico

Warehouse and administrative offices

Nagoya, Japan

Nogales, Mexico

Warehouse and administrative offices

Tecate, Mexico

Warehouse and administrative offices

Tecate, Mexico

Idle facility

Yokohama, Japan

Total non-manufacturing

Zug, Switzerland

Administrative, sales and research offices

(1) These facilities relate to the ongoing restructuring activities involving the Juarez and Matamoros site consolidation..

We regularly assess our facilities for manufacturing capacity, available labor, and proximity to our markets and major customers.

Management believes our manufacturing facilities are suitable and adequate and have sufficient capacity to meet our current needs.

Management believes our manufacturing facilities are suitable and adequate and have sufficient capacity to meet our current needs including approximately 1 million square feet of manufacturing and 750 thousand square feet of non-manufacturing spaces.

The extent of utilization varies from plant to plant and with economic conditions.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business