What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2023-03-01 compared with 2022-02-28 · 86 added, 73 removed, 93 unchanged (63% of the section changed)

We are a diversified manufacturer of highly engineered industrial products.

Our operations are comprised of four segments:

Aerospace & Electronics, Process Flow Technologies, Payment & Merchandising Technologies, and Engineered Materials.

Our primary end markets include process industries (chemical production, oil & gas, power, and general industrial), non-residential and municipal construction, payment automation solutions, banknote design and production, aerospace, defense and space, along with a wide range of general industrial and certain consumer related end markets.

Our operations are currently comprised of four segments:

Aerospace & Electronics (“A&E”), Process Flow Technologies (“PFT”), Payment & Merchandising Technologies (“P&MT”), and Engineered Materials (“EM”).

Our primary end markets include aerospace, defense and space, process industries, non-residential and municipal construction, payment automation solutions, banknote design and production, along with a wide range of general industrial and certain consumer related end markets.

We have been committed to the highest standards of business conduct since inception in 1855 when our founder, R.T.

11 unchanged sentences

Recent Transactions

Holding Company Reorganization

On May 16, 2022, Crane Co., a Delaware corporation (“Crane Co.”), completed its previously announced reorganization merger pursuant to the Agreement and Plan of Merger, dated as of February 28, 2022 (the “Reorganization Agreement”), by and among Crane Co., Crane Holdings, Co., a Delaware corporation (“Crane Holdings”), and Crane Transaction Company, LLC, a Delaware limited liability company and, as of immediately prior to the consummation of such merger, a wholly-owned subsidiary of Crane Holdings (“Merger Sub”).

The Reorganization Agreement provided for the merger of Crane Co.

and Merger Sub, with Crane Co.

surviving the merger as a wholly-owned subsidiary of Crane Holdings (the “Reorganization Merger”).

Following the Reorganization Merger, on May 16, 2022, Crane Co.

converted from a Delaware corporation into a Delaware limited liability company named “Crane LLC” (such conversion, together with the Reorganization Merger, the “Reorganization”).

Following the Reorganization, substantially all of the assets of Crane LLC were distributed, assigned, transferred, conveyed and delivered to, and certain non-asbestos related liabilities of Crane LLC were assumed by, Crane Holdings.

On May 17, 2022, Crane LLC converted from a Delaware limited liability company to a Delaware corporation named “Crane Co.” Subsequently, on May 26, 2022, Crane Co.

filed a Certificate of Amendment to its Certificate of Incorporation (the “Certificate of Amendment”) with the Secretary of State of the State of Delaware, which became effective upon filing, pursuant to which the Crane Co.

officially changed its name from “Crane Co.” to “Redco Corporation”.

The “Crane Co.” name has been reserved for future use by Crane Holdings.

Divestiture of asbestos-related assets and liabilities

On August 12, 2022, Crane Holdings, Co., Crane Company, a wholly-owned subsidiary of Crane Holdings, Co., and Redco Corporation (“Redco”), then a wholly-owned subsidiary of Crane Company that held asbestos liabilities and related insurance assets, entered into a Stock Purchase Agreement (the “Redco Purchase Agreement”) with Spruce Lake Liability Management Holdco LLC (“Redco Buyer”), an unrelated third party and long-term liability management company specializing in the acquisition and management of legacy corporate liabilities whereby Crane Company transferred to Redco Buyer all of the issued and outstanding shares of Redco (the “Redco Sale”).

In connection with the Redco Sale, Crane Holdings, Co., on behalf of Crane Company, contributed approximately $550 million in cash to Redco, which was funded by a combination of short-

term borrowings and cash on hand.

As a result of the Redco Sale, all asbestos obligations and liabilities, related insurance assets and associated deferred tax assets have been removed from Crane Holdings, Co.’s consolidated balance sheets effective August 12, 2022.

A loss on the divestiture of asbestos-related assets and liabilities of $162.4 million was recognized in the consolidated statements of operations for the year ended December 31, 2022.

Sale of Crane Supply

On April 8, 2022, the Company entered into an agreement to sell the Crane Supply business for CAD 380 million on a cash-free and debt-free basis.

Subsequent to net working capital and other closing adjustments, the sale closed on May 31, 2022 for CAD 402 million.

In August 2022, the Company received CAD 5 million related to a final working capital adjustment.

The Company recognized a total gain on sale of $232.5 million.

Pending Separation

On March 30, 2022, the Company announced that its Board of Directors unanimously approved a plan to pursue a separation into two independent, publicly-traded companies (the “Separation”), Crane Company and Crane NXT, Co.

Upon completion of the pending Separation, Crane Holdings, Co.

will be renamed “Crane NXT, Co.” and will continue to operate our Payment & Merchandising Technologies segment.

The new company distributed to our stockholders in the Separation, Crane Company, will hold our Aerospace & Electronics and Process Flow Technologies global growth platforms, as well as our Engineered Materials segment.

The Separation is expected to occur through a tax-free distribution of all of the outstanding shares of Crane Company common stock to holders of our common stock and is expected to be completed in April, 2023, subject to the satisfaction of customary conditions and final approval by Crane Holdings, Co.’s Board of Directors.

On February 7, 2023, the SEC declared effective the registration statement of Crane Company on Form 10.

Each of our stockholders will receive one share of Crane Company common stock for every one share of our common stock held on March 23, 2023, the record date for the distribution.

For additional information regarding the Separation, including risk factors, see the Information Statement of Crane Company, filed as Exhibit 99.1 to Amendment No.

1 to the registration statement on Form 10 filed by Crane Company with the SEC on January 23, 2023.

Termination of Agreement to Sell Engineered Materials

On May 16, 2021, we entered into an agreement to sell the Engineered Materials segment to Grupo Verzatec S.A.

for $ 360 million on a cash-free and debt-free basis.

The sale is subject to customary closing conditions and regulatory approvals.

We determined that the Engineered Materials segment met the criteria of being reported as a discontinued operation as of June 30, 2021.

As a result, the related assets, liabilities and operating results of Engineered Materials are presented as discontinued operations and, as such, have been excluded from both continuing operations and segment results for all periods presented.

Throughout this Annual Report on Form 10-K, unless otherwise indicated, amounts and activity are presented on a continuing operations basis.

See Part II, Item 8 under Note 3, “Discontinued Operations,” in the Notes to Consolidated Financial Statements for additional details.

(“Verzatec”) for $360 million on a cash-free and debt-free basis.

In the second quarter of 2021, the assets and liabilities of the segment were classified as held for sale.

On May 26, 2022, Verzatec terminated the sale agreement and paid $7.5 million to the Company in termination fees, which is presented within Miscellaneous income, net on the Consolidated Statements of Operations.

As such, as of June 30, 2022 the Engineered Materials segment is no longer classified as assets held for sale and is presented herein as continuing operations for all periods presented.

Reportable Segments

3 unchanged sentences

The commercial market and military market accounted for 57% and 43%, respectively, of total segment sales in 2022.

Sales to original equipment manufacturers ("OEM") and aftermarket customers were 74% and 26%, respectively, in 2021.

Crane Aerospace & Electronics has strong brands which have been supplying products to these end markets for several decades.

Brands include Hydro-Aire, ELDEC, Lear Romec, P.L.

Porter, Keltec, Interpoint, Signal Technology, Merrimac, and Industries.

Products include a wide range of custom designed, highly engineered products used in landing systems, sensing and utility systems, fluid management, seat actuation, power and microelectronic applications, and microwave systems.

Our products are sold directly to aircraft manufacturers, commercial Tier 1 integrators (companies which make products specifically for an aircraft manufacturer), defense and space prime contractors, airlines, government agencies including the U.S.

Department of Defense, foreign allied defense organizations, aircraft seat manufacturers, and aircraft maintenance, repair and overhaul organizations.

Sales to original equipment manufacturers ("OEMs") and aftermarket customers were 72% and 28%, respectively, in 2022.

We provide mission critical systems that require high reliability and high accuracy, such as pressure sensors for aircraft engine control, aircraft braking systems for fighter jets, power conversion solutions for spacecraft and lubrication systems for the harshest and most hazardous environmental conditions.

Crane has differentiated proprietary technology and know-how supporting many of the fundamental technologies that are supporting solutions where we are often sole source in the areas where we compete, with a track record for performance, reliability and continued innovation.

A&E’s integrated capabilities include the following:

• Power Solutions:

Provides enabling technology to accelerate electrification of air, land, space and sea vehicles and systems.

• Sensing Systems:

Provides components and systems for condition and position sensing, and pressure and flow measurement, with high-accuracy, reliability and engineering to excel in rugged aerospace environments.

• Fluid & Thermal Management:

Designs and manufactures positive displacement pumps, centrifugal pumps and true mass flowmeters for aerospace and defense applications.

• Landing Systems:

Provides hydraulic and electric brake control systems with antiskid and autobrake functionality, as well as electronic and hydraulic subsystems for landing gear control.

• Microwave Solutions:

Designs and manufactures high-performance RF and IF components and millimeter-wave systems and subsystems for defense, space and commercial end-use customers.

A&E has a solid long term growth profile driven by positions on market leading platforms, recent new program wins and continued investment in technology readiness.

The segment is also positioned to benefit from underlying market growth driven by increasing new commercial aircraft deliveries, air passenger travel growth, defense investment, ongoing maintenance, repair and overhaul organizations (“MRO”) requirements and emerging applications in the space market, as well as a strong trend driving greater electrification for aerospace and defense applications.

Our unique position to drive sustained growth is driven by differentiated technology investment focused on high-growth market segments, including Low Earth Orbit satellite constellations, next-generation aircraft engines, advanced ground and sea-based radar systems, as well as high-power and bi-directional power conversion for numerous emerging commercial and military applications, including more-electric and hybrid-electric ground vehicles and hybrid-electric and pure electric-propulsion aircraft.

Facilities are located in the United States, Taiwan, and France.

Process Flow Technologies

In the second quarter of 2021, we changed the name of our 'Fluid Handling' segment to 'Process Flow Technologies'.

This new name better conveys the key strengths and core competencies of the segment;

providing proprietary and highly engineered process flow technology solutions to its customers.

The Process Flow Technologies segment is a provider of highly engineered fluid handling equipment for mission critical applications that require high reliability.

The segment is comprised of Process Valves and Related Products, Commercial Valves, and Pumps and Systems.

Process Valves and Related Products manufactures on/off isolation valves, instrumentation and controls, and related products for critical and demanding applications primarily in the chemical and petrochemical, general industrial, energy- related and pharmaceutical end markets globally.

Products are sold under the trade names Crane, Saunders, Jenkins, Pacific, Xomox, Krombach, DEPA, ELRO, REVO, Flowseal, Centerline, Resistoflex, Duochek, Barksdale, Dynalco, Westlock, WTA, HOKE and DOPAK.

The segment is comprised of Process Valves and Related Products, Pumps and Systems and Commercial Valves.

• Process Valves and Related Products:

Manufactures a wide range of on/off isolation valves, including check valves, sleeved plug valves, lined valves, process ball valves, high performance butterfly valves, bellows sealed globe valves, aseptic and industrial diaphragm valves and multi / quarter-turn valves actuation.

Other related products include lined pipe, fittings and hoses, air operated diaphragm and peristaltic pumps, instrumentation and sampling systems, valve positioning and control systems, valve diagnostic and calibration systems.

Across the portfolio, the primary focus is on chemical, pharmaceutical and general industrial end markets.

Manufacturing facilities, along with sales and service centers, are located across North America, Europe, the Middle East, Asia and Australia.

Commercial Valves is engaged primarily in the manufacturing of valves and related products for the non-residential construction, general industrial, and municipal markets, and the distribution of pipe, valves and fittings (PVF) for the non-residential construction market.

The primary geographies served by the manufacturing operations are the United Kingdom, the Middle East and continental Europe, and the PVF distribution business is focused exclusively on Canada.

Brands include Stockham, Wask, Viking Johnson, IAT, Hattersley, NABIC, Sperryn, Wade, and Crane Supply.

Manufacturing facilities are located in the United Kingdom and China, with additional sales offices in continental Europe and the Middle East;

distribution facilities are located throughout Canada.

Pumps and Systems manufactures pumps and related products for water and wastewater applications in the industrial, municipal, commercial and military markets, primarily in the United States.

Products are sold under the trade names Deming, Weinman, Burks and Barnes.

Facilities are located in the United States and Canada.

• Pumps and Systems:

Manufactures pumps products for water and wastewater applications, primarily in the United States municipal and industrial markets.

• Commercial Valves:

Manufactures valves and related products for the non-residential construction, gas utility and municipal markets.

The primary geographies served by the manufacturing operations are the United Kingdom, the Middle East and continental Europe.

Our portfolio strategically targets the higher growth and less cyclical chemical, general industrial, water and wastewater and pharmaceutical industries.

We expect these industries to be outsized growth segments of the market, driven by investment in sustainability and clean energy, aging infrastructure, tightening wastewater regulations and an aging population with a growing demand for healthcare.

Crane has a strong track record of innovation and being a pioneer in the industry, “writing the book” on the flow of fluids with Technical Paper 410, which is still used as a definitive authority on the topic for engineers, professionals and other practitioners.

By focusing on accelerating the rate of innovation through R&D investment, we have driven incremental market capture and significantly improved new product sales vitality to support long term profitable growth.

Payment & Merchandising Technologies

The Payment & Merchandising Technologies segment consists of Crane Payment Innovations (“CPI”) and Crane Currency.

CPI provides high technology payment acceptance and dispensing products to original equipment manufacturers, and for certain vertical markets, it also provides currency handling and processing systems, complete cash and cashless payment and merchandising solutions, equipment service solutions, and fully connected managed service solutions.

Facilities are located in the United States, the United Kingdom, Mexico, Japan, Switzerland, Germany and the Ukraine, with additional sales offices across the world.

Crane Currency is a supplier of banknotes and highly engineered banknote security features as well as a provider of security features for product authentication.

A pioneer in advanced micro-optics technology, Crane Currency provides a wide range of engaging visual effects in features that increase the level of security and public trust in banknotes and for the product brand authentication market.

Crane Currency offers uniquely designed banknotes, substrate (paper) and printing capabilities for over 50 central banks around the world, with facilities located in the United States, Sweden and Malta.

CPI provides electronic equipment and associated software leveraging extensive and proprietary core capabilities with various detection and sensing technologies for applications including payment verification and authentication.

CPI also provides automation solutions, field service solutions, and remote diagnostics and productivity enhancing software solutions.

Key R&D and manufacturing facilities are located in the United States, the United Kingdom, Mexico, Japan, Switzerland, and Germany, with additional sales offices across the world.

Crane Currency is a pioneer in advanced, proprietary micro-optics technology

for securing physical products.

It provides a broad portfolio of engaging visual effects in features that aid in verification, thereby increasing the level of security and public trust in the authenticity of products including banknotes, consumer goods, and industrial products.

Additionally, Crane Currency has provided banknote substrate to the U.S.

Government since 1879, and today, customers for its advanced technology include more than 50 central banks around the world, and a growing number of consumer and industrial companies.

Facilities are located in the United States, Sweden and Malta.

Engineered Materials

2 unchanged sentences

Manufacturing facilities are located in the United States.

In the second quarter of 2021, the Engineered Materials segment met the criteria to be reported as discontinued operations.

See “Recent Transactions” for additional details.

Other Matters Relating to Our Business as a Whole

5 unchanged sentences

Our primary basis of competition is providing high quality products, with technological differentiation, at competitive prices, with superior customer service and timely delivery.

Our products are sold into primary end markets which include process industries (chemical production, oil & gas, power, and general industrial), non-residential and municipal construction, payment automation solutions, banknote design and production, aerospace, defense and space, along with a wide range of general industrial and certain consumer related end markets.

Our products are sold into primary end markets which include aerospace, defense and space, process industries, non-residential and municipal construction, payment automation solutions, banknote design and production, along with a wide range of general industrial and certain consumer related end markets.

As such, our revenues depend on numerous unpredictable factors, including changes in market demand, general economic conditions, customer capital spending, timing and amount of contract awards and credit availability.

10 unchanged sentences

“Risk Factors.”

Seasonal Nature of Business

In aggregate, our business does not experience significant seasonality.

Government Contracts

13 unchanged sentences

When it is reasonably probable we will pay remediation costs at a site, and those costs can be reasonably estimated, we accrue a liability for such future costs with a related charge against our earnings.

further discussion of environmental related risks, please refer to Item 1A.

For further discussion of environmental related risks, please refer to Item 1A.

“Risk Factors.” For further discussion of our environmental matters, please refer to Part II, Item 8 under Note 12, “Commitments and Contingencies,” in the Notes to Consolidated Financial Statements.

10 unchanged sentences

We are committed to developing our associates personally and professionally by leveraging a structured and disciplined Intellectual Capital (“IC”) process.

This regular IC cadence includes constructive reviews and various talent and leadership development initiatives conducted by the executive management team and provided throughout an associate’s career.

Our regular IC cadence includes constructive reviews and various talent and leadership development initiatives conducted by the executive management team and provided throughout an associate’s career.

We are also committed to an inclusive and high-performance culture at all levels of the organization, based on trust and respect.

4 unchanged sentences

These protocols included proper hygiene, social distancing, mask use and temperature screenings and other health and safety standards as required by federal, state and local government agencies, taking into consideration guidelines of the Centers for Disease Control and Prevention in the U.S., and other similar public health authorities in our international locations.

Today, we continue to deploy various work options and protocols in response to the significantly reduced health risks compared to the initial and early period of the pandemic.

For a discussion of risks related to employee relations, please refer to Item 1A.

6 unchanged sentences

We also make our filings available free of charge through our Internet website, as soon as reasonably practicable after filing such material electronically with, or furnishing such material, to the SEC.

Also posted on our website are our Corporate Governance Guidelines, Standards for Director Independence, Crane Co.

Also posted on our website are our Corporate Governance Guidelines, Standards for Director Independence, Crane Holdings, Co.

Code of Ethics and the charters and a brief description of each of the Audit Committee, the Management Organization and Compensation Committee and the Nominating and Governance Committee.

1 unchanged sentence

The content of our website is not part of this report.

Executive Officers of the Registrant

Name Position Business Experience Age Executive

Officer Since

Mitchell President and Chief Executive Officer President, Chief Executive Officer and Director since 2014.

President and Chief Operating Officer from 2013 through 2014.

Executive Vice President and Chief Operating Officer from 2011 to 2013.

Alejandro Alcala Senior Vice President Senior Vice President Process Flow Technologies and operations in China, India and the Middle East & Africa since March 2020.

President, Crane ChemPharma & Energy from 2014 to March 2020.

President, Crane Pumps & Systems from 2013 to 2014.

Christina Cristiano Vice President, Controller and Principal Accounting Officer Vice President, Controller and Principal Accounting Officer since May 2019.

Vice President, Controller of Global Accounting and Statutory Reporting of Thomson Reuters from 2011 to May 2019.

D'Iorio Senior Vice President, General

Counsel and Secretary Senior Vice President since February 2021.

Vice President, General Counsel and Secretary since February 2018.

Deputy General Counsel from 2013 through February 2018.

Assistant General Counsel from 2005 through 2013.

Gallo Senior Vice President Senior Vice President, Payment & Merchandising Technologies and Engineered Materials since April 2019.

President, Crane Payment Solutions since 2012 and its successor, Crane Payment Innovation since 2014.

Grisham Senior Vice President, Business Development and Strategy Senior Vice President, Business Development and Strategy since April 2021.

Vice President, Business Development & Strategy of Colfax Corporation from 2014 to April 2021.

Maue Senior Vice President and

Chief Financial Officer Senior Vice President since January 2019.

Chief Financial Officer since 2013.

Principal Accounting Officer from 2007 through May 2019.

Vice President - Finance from 2013 through January 2019.

Polmanteer Senior Vice President, Chief Human Resources Officer Senior Vice President, Chief Human Resources Officer since March 2021.

Chief Human Resources Officer of Aleris from 2016 through 2020.

Senior Vice President, Chief Human Resource Officer of Daymon Worldwide from 2011 through 2016.

Switter Vice President, Treasurer and Tax Vice President, Treasurer and Tax since September 2016.

Vice President, Tax from 2011 through September 2016.

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