What changed in this filing

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Item 1A. Risk Factors

2023-02-15 compared with 2022-02-11 · 74 added, 57 removed, 224 unchanged (37% of the section changed)

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Past financial performance may not be a reliable indicator of future performance and historical trends should not be used to anticipate results or trends in future periods.

Risks Relating to the In-Scope M&M Divestiture Process, N&B Transaction and the Dow and Corteva Distributions

The timing and outcome of the In-Scope M&M Divestiture Process is subject to risk and uncertainties.

The outcome of the In-Scope M&M Divestiture Process, including the entry into a definitive agreement to effect a disposition of the In-Scope M&M Businesses, is subject to approval of the DuPont Board of Directors.

There can be no assurance that the Company can satisfy any conditions to closing, which would include obtaining any necessary approvals, including regulatory approvals;

or will realize the expected benefits in connection with such a disposition, if any.

In addition, unforeseen liabilities, future capital expenditures, revenues, expenses, earnings, synergies, economic performance, indebtedness, financial condition, losses, future prospects, business and management strategies, could impact the value, timing or pursuit of any disposition of the In-Scope M&M Businesses.

While DuPont is engaged in certain internal reorganization activities to separate the In-Scope M&M Business into separate subsidiaries and to align such subsidiaries for possible disposition in a tax-efficient manner, it is expected that such a disposition would result in a taxable transaction for the Company.

Risks Relating to the M&M Divestitures, N&B Transaction and the Dow and Corteva Distributions

DuPont could incur additional tax liabilities if certain internal transactions undertaken in connection with the completed divestiture of a majority of its historic Mobility & Materials segment to Celanese, and in connection with DuPont’s pursuit of plans to divest the Delrin® business, fail to qualify for their intended tax treatment.

On November 1, 2022, DuPont and one of its subsidiaries completed the sale to Celanese of a majority of the Company’s historic Mobility & Materials segment, including the Engineering Polymers business line and select product lines within the Performance Resins and Advanced Solutions business lines (the “M&M Divested Businesses”) for $11 billion in cash, subject to customary transaction adjustments in accordance with the Transaction Agreement (the “M&M Divestiture”).

On February 18, 2022, DuPont also announced that its Board of Directors approved the divestiture of the Delrin® Business subject to entry into a definitive agreement and satisfaction of customary closing conditions.

There can be no assurance as to the outcome, timing or ability to realize expected benefits from the Delrin® business divestiture process.

Prior to the Closing of the M&M Divestiture, DuPont engaged in certain internal reorganization activities to separate the M&M Divested Businesses, and in certain cases in connection therewith, the Delrin® business, into separate subsidiaries and to align the subsidiaries holding the M&M Divested Businesses and the Delrin® business (referred to collectively as the "M&M Businesses") for disposition in a tax-efficient manner.

DuPont has recognized a tax liability related to the M&M Divestiture.

However, if certain internal transactions related to the separation of the M&M Businesses fail to qualify for their intended tax treatment under U.S.

federal, state, local tax and/or foreign tax law, DuPont could incur additional tax liabilities.

DuPont may not realize the anticipated benefits of its share repurchase programs and any failure to repurchase the Company’s common stock after DuPont has announced its intention to do so may negatively impact the Company’s stock price .

On November 7, 2022, DuPont’s Board of Directors approved a new share repurchase program, which terminates on June 30, 2024, unless extended or shortened by the Board, authorizing the repurchase and retirement of up to $5 billion of common stock.

In addition to the $250 million remaining under the Company’s existing share repurchase program, which was approved in February 2022.

The Company entered into the 2022 ASR Agreements in November 2022 for the repurchase of an aggregate of $3.25 billion of common stock with $250 million of such repurchases under the existing program and the remaining $3 billion under the new program.

Under these or any other future share repurchase programs, DuPont may make share repurchases through a variety of methods, including open share market purchases or privately negotiated transactions, including additional ASR agreements in accordance with applicable federal securities laws.

The timing and amount of any repurchases, if any, will depend on factors such as the stock price, economic and market conditions, and corporate and regulatory requirements.

Any failure to repurchase shares after the Company has announced its intention to do so may negatively impact DuPont’s reputation, investor confidence and the price of the Company’s common stock.

The existence of these share repurchase programs could cause the price of the Company’s common stock to be higher than it otherwise would be and could potentially reduce the market liquidity for DuPont stock.

Although these programs are intended to enhance long-term stockholder value, there is no assurance they will do so because the market price of DuPont common stock may decline below the levels at which we repurchased shares and short-term stock price fluctuations could reduce the effectiveness of the programs.

Repurchasing common stock will reduce the amount of cash DuPont has available to fund working capital, capital expenditures, strategic acquisitions or business opportunities and other general corporate requirements, and the Company may fail to realize the anticipated benefits of these share repurchase programs.

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The separation and combination of DuPont’s Nutrition & Biosciences business with IFF could result in a significant tax liability to DuPont.

The distribution by DuPont to its stockholders of all the issued and outstanding shares of N&B through the Exchange Offer ("N&B Distribution") and Mergers are expected to be tax-free to DuPont stockholders for U.S.

federal income tax purposes (except to the extent that cash was paid to DuPont stockholders in lieu of fractional shares pursuant to the N&B Merger Agreement), and the N&B Contribution, N&B Distribution, and Special Cash Payment are expected to result in no recognition of gain or loss by DuPont for U.S.

The distribution by DuPont to its stockholders of all the issued and outstanding shares of N&B through the Exchange Offer ("N&B Distribution") and the merger of N&B with a wholly-owned subsidiary of IFF ("N&B Merger") are expected to be tax-free to DuPont stockholders for U.S.

federal income tax purposes (except to the extent that cash was paid to DuPont stockholders in lieu of fractional shares pursuant to the N&B Merger Agreement), and the N&B Contribution, N&B Distribution, and the one-time payment from N&B to DuPont of approximately $7.3 billion ("Special Cash Payment") are expected to result in no recognition of gain or loss by DuPont for U.S.

federal income tax purposes.

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After the separations and DWDP Distributions, there are several significant areas where the liabilities of Dow and Corteva may become the Company’s obligations, either in whole or in part.

For example, to the extent that any subsidiary of the Company was included in the consolidated tax reporting group of either TDCC or EID for any taxable period or portion of any taxable period ending on or before the effective date of the DWDP Merger, such subsidiary is jointly and severally liable for the U.S.

federal income tax liability of the entire consolidated tax reporting group of TDCC or EID, as applicable, for such taxable period.

For example, to the extent that any subsidiary of the Company was included in the consolidated tax reporting group of either TDCC or EIDP for any taxable period or portion of any taxable period ending on or before the effective date of the DWDP Merger, such subsidiary is jointly and severally liable for the U.S.

federal income tax liability of the entire consolidated tax reporting group of TDCC or EIDP, as applicable, for such taxable period.

In connection with the separations and DWDP Distributions, DuPont, Dow and Corteva have entered into a Tax Matters Agreement, as amended, that allocates the responsibility for prior period consolidated taxes among Dow, Corteva and DuPont.

If Dow or Corteva are unable to pay any prior period taxes for which it is responsible, however, DuPont could be required to

pay the entire amount of such taxes, and such amounts could be significant.

If Dow or Corteva are unable to pay any prior period taxes for which it is responsible, however, DuPont could be required to pay the entire amount of such taxes, and such amounts could be significant.

Other provisions of federal, state, local, or foreign law may establish similar liability for other matters, including laws governing tax-qualified pension plans, as well as other contingent liabilities.

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Payments pursuant to these indemnities may be significant and could negatively impact the Company’s business.

Third parties could also seek to hold DuPont responsible for any of the liabilities allocated to Dow and Corteva, including those related to EID’s materials science and/or agriculture businesses, or for the conduct of such businesses prior to the distributions, and such third parties could seek damages, other monetary penalties (whether civil or criminal) and/or other remedies.

Third parties could also seek to hold DuPont responsible for any of the liabilities allocated to Dow and Corteva, including those related to EIDP’s materials science and/or agriculture businesses, or for the conduct of such businesses prior to the distributions, and such third parties could seek damages, other monetary penalties (whether civil or criminal) and/or other

Table of Conten ts

Additionally, DuPont generally assumes and is responsible for the payment of the Company’s share of (i) certain liabilities of DowDuPont relating to, arising out of or resulting from certain general corporate matters of DuPont and (ii) certain separation expenses not otherwise allocated to Corteva or Dow (or allocated specifically to it) pursuant to the Core Agreements, and third parties could seek to hold it responsible for Dow’s or Corteva’s share of any such liabilities.

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Each of these risks could negatively affect the Company’s business, financial condition, results of operations and cash flows.

Generally, as described in Litigation, Environmental Matters and Indemnifications, losses from liabilities related to discontinued and/or divested operations and businesses of EID that are not primarily related to its agriculture business or specialty products business, (“Stray Liabilities”), are allocated to or shared by each of Corteva and DuPont.

Stray Liabilities include liabilities arising out of actions to the extent related to or resulting from EID’s development, testing, manufacture or sale of per- or polyfluoroalkyl substances, (“PFAS Stray Liabilities”).

Generally, as described in Litigation, Environmental Matters and Indemnifications, losses from liabilities related to discontinued and/or divested operations and businesses of EIDP that are not primarily related to its agriculture business or specialty products business, (“Stray Liabilities”), are allocated to or shared by each of Corteva and DuPont.

Stray Liabilities include liabilities arising out of actions to the extent related to or resulting from EIDP’s development, testing, manufacture or sale of per- or polyfluoroalkyl substances, (“PFAS Stray Liabilities”).

At December 31, 2022, the Company has recorded an indemnification liability related to Stray Liabilities.

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and the presence and financial viability of other potentially responsible parties.

At December 31, 2021, the Company had recorded indemnification assets related to various Stray Liabilities and other matters.

At December 31, 2022, the Company had recorded indemnification assets related to Stray Liabilities and other matters.

Although the Company believes it is remote, there can be no assurance that any such third-party would have adequate resources to satisfy its indemnification obligation when due, or, would not ultimately be successful in claiming defenses against payment.

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The Company’s results of operations could be adversely affected by litigation and other commitments and contingencies, including expected performance under and impact of the cost sharing arrangement.

Although by reducing uncertainty, the Company expects to benefit from the cost sharing arrangement related to future PFAS eligible costs, achievement of any such benefits may not be realized and depend on a number of factors and uncertainties that include, but are not limited to:

While reducing uncertainty, the Company expects to benefit from the cost sharing arrangement related to future PFAS eligible costs, achievement of any such benefits may not be realized and depend on a number of factors and uncertainties that include, but are not limited to:

the achievement, terms and conditions of final agreements related to the cost sharing arrangement;

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If DuPont is required to make payments as a result, they could exceed the amounts accrued therefor, thereby adversely affecting the Company’s results of operations.

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If the completed distribution of Corteva or Dow, in each case, together with certain related transactions, were to fail to qualify for non-recognition treatment for U.S.

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Even if a distribution otherwise constituted a tax-free transaction to stockholders under Section 355 of the Code, the Company could be required to recognize corporate level tax on such distribution and certain related transactions under Section 355(e) of the Code if the IRS determines that, as a result of the DWDP Merger or other transactions considered part of a plan with such distribution, there was a 50 percent or greater change in ownership in the Company, Dow or Corteva, as relevant.

In connection with the DWDP Merger, the Company sought and received a private letter ruling from the IRS regarding the proper time, manner and methodology for measuring common ownership in the stock of the Company, EID and TDCC for purposes of determining whether there was a 50 percent or greater change of ownership under Section 355(e) of the Code as a result of the DWDP Merger (the “IRS Ruling”).

The Tax Opinions relied on the continued validity of the IRS Ruling and representations made by the Company as to the common ownership of the stock of TDCC and EID immediately prior to the DWDP Merger, and concluded that there was not a 50 percent or greater change of ownership for purposes of Section 355(e) as a result of the DWDP Merger.

In connection with the DWDP Merger, the Company sought and received a private letter ruling from the IRS regarding the proper time, manner and methodology for measuring common ownership in the stock of the Company, EIDP and TDCC for purposes of determining whether there was a 50 percent or greater change of ownership under Section 355(e) of the Code as a result of the DWDP Merger (the “IRS Ruling”).

The Tax Opinions relied on the continued validity of the IRS Ruling and representations made by the Company as to the common ownership of the stock of TDCC and EIDP immediately prior to the DWDP Merger, and concluded that there was not a 50 percent or greater change of ownership for purposes of Section 355(e) as a result of the DWDP Merger.

Notwithstanding the Tax Opinions and the IRS Ruling, the IRS could determine that a distribution or a related transaction should nevertheless be treated as a taxable transaction to the Company if it determines that any of the Company’s facts, assumptions, representations or undertakings was not correct or that a distribution should be taxable for other reasons, including if the IRS were to disagree with the conclusions in the Tax Opinions that are not covered by the IRS Ruling.

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However, if a distribution fails to qualify for non-recognition treatment for U.S.

federal income tax purposes for certain reasons relating to the overall structure of the DWDP Merger and the distributions, then under the DWDP Tax Matters Agreement, as amended, the Company and Corteva, on the one hand, and Dow, on the other hand, would share the tax liability resulting from such failure in accordance with the relative equity values of the Company and Dow on the first full trading day following the distribution of Dow, and the Company and Corteva would in turn share any such resulting tax liability

in accordance with the relative equity values of the Company and Corteva on the first full trading day following the distribution of Corteva.

Furthermore, under the terms of the DWDP Tax Matters Agreement, as amended, a party also generally will be responsible for any taxes imposed on the other parties that arise from the failure of either distribution to qualify as tax-free for U.S.

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To the extent that the Company is responsible for any liability under the DWDP Tax Matters Agreement, as amended, there could be a material adverse impact on the Company's business, financial condition, results of operations and cash flows in future reporting periods.

The DWDP separations and DWDP Distributions and the N&B Transaction may expose the Company to potential liabilities arising out of state and federal fraudulent conveyance laws and legal distribution requirements.

Although in connection with the DWDP Distributions and in connection with the N&B Transaction DuPont received separate solvency opinions from investment banks confirming that DuPont, Dow, Corteva and N&B would each be adequately capitalized following the separations and DWDP Distributions, and the N&B Transactions as relevant, (the “Transactions”), the Transactions could be challenged under various state and federal fraudulent conveyance laws.

Fraudulent conveyances or transfers are generally defined to include transfers made or obligations incurred with the actual intent to hinder, delay or defraud current or future creditors or transfers made or obligations incurred for less than reasonably equivalent value when the debtor was insolvent, or that rendered the debtor insolvent, inadequately capitalized or unable to pay its debts as they become due.

Any unpaid creditor could claim that DuPont did not receive fair consideration or reasonably equivalent value in any of the Transactions and that any one or the aggregate of the Transactions left DuPont insolvent or with unreasonably small capital or that DuPont intended or believed DuPont would incur debts beyond the Company’s ability to pay such debts as they mature.

If a court were to agree with such a plaintiff, then such court could void the separations and distributions as a fraudulent transfer or impose substantial liabilities on it, which could adversely affect the Company’s financial condition and the Company’s results of operations.

The Transactions are also subject to review under state corporate distribution statutes.

Under the Delaware General Corporation Law, a corporation may only pay dividends to its stockholders either (i) out of its surplus (net assets minus capital) or (ii) if there is no such surplus, out of its net profits for the fiscal year in which the dividend is declared and/or the preceding fiscal year.

Although DuPont’s Board of Directors made the distributions out of DuPont’s surplus and received an opinion that DuPont had adequate surplus under Delaware law to declare the dividends of Corteva and Dow common stock in connection with the DWDP Distributions there can be no assurance that a court will not later determine that some or all of the distributions were unlawful.

Risks Relating to DuPont’s Business and Results of Operations

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The Company’s business and financial condition, and the business and financial condition of the company’s customers and suppliers, have been and continue to be impacted by the significantly increased economic, supply and demand uncertainties created by the COVID-19 outbreak.

In addition, public and private sector responsive measures, such as the imposition of travel restrictions, quarantines, adoption of remote working, and suspension of non-essential business and government services, have impacted the Company’s business and financial condition.

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Company’s business and financial condition.

Many of DuPont’s facilities and employees are based in areas impacted by the virus.

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Limitations on travel and doing business in-person has increased the Company’s exposure to cybersecurity risks and could negatively impact the Company's innovation and marketing efforts, challenge the ability to deliver against the Company’s strategic priorities and to otherwise transact business in a timely manner, or create operational or other challenges, any of which could harm DuPont’s business.

Furthermore, COVID-19 continues to adversely impact the broader global economy, including negatively impacting economic

growth and creating disruption and volatility in the global financial and capital markets, which could result in increases in the cost of capital and/or adversely impact the availability of and access to capital, which could negatively affect DuPont’s liquidity.

Furthermore, COVID-19 continues to adversely impact the broader global economy, including negatively impacting economic growth and creating disruption and volatility in the global financial and capital markets, which could result in increases in the cost of capital and/or adversely impact the availability of and access to capital, which could negatively affect DuPont’s liquidity.

DuPont is unable to predict the extent of COVID-19 related impacts on its business, results of operations, access to sources of liquidity and financial condition which depends on highly uncertain and unpredictable future developments, including, but not limited to, the duration and spread of the COVID-19 outbreak, its severity, the emergence of new variants, actions taken in response, the efficacy and availability of vaccines, and how quickly and to what extent normal economic and operating conditions resume.

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Success in offsetting higher raw material costs with price increases is largely influenced by competitive and economic conditions and could vary significantly depending on the market served.

As a result, volatility in these costs may negatively impact the Company’s business, results of operations, financial condition and cash flows.

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result, volatility in these costs may negatively impact the Company’s business, results of operations, financial condition and cash flows.

The Company’s business, results of operations, financial condition and cash flows could be adversely affected by interruption of the Company’s information technology or network systems and other business disruptions.

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Additionally, the Company collects and stores certain data, including proprietary business information, and has access to confidential or personal information that is subject to privacy and security laws, regulations and customer-imposed controls.

The processing and storage of personal information is increasingly subject to privacy and data security regulations, and many such regulations are country-specific.

The interpretation and application of data protection laws in the U.S., Europe, including the EU General Data Protection Regulation, Asia Pacific, Latin America, and elsewhere are uncertain, evolving and may be inconsistent among jurisdictions.

Violations of these laws could result in criminal or civil sanctions and even the mere

allegation of such violations, could harm the Company’s ability to do business, its results of operations, financial position and reputation.

The processing and storage of personal information is increasingly subject to privacy and data security regulations, and many such regulations are country or territory-specific.

The interpretation and application of data protection laws in the U.S., Europe, including the EU General Data Protection Regulation, Asia Pacific, Latin America, and elsewhere are continuing to evolve and may be different across these jurisdictions.

The Company seeks to implement these requirements in a compliant manner.

Violations of these laws could result in criminal or civil sanctions and even the mere allegation of such violations, could harm the Company’s ability to do business, its results of operations, financial position and reputation.

Information technology system and/or network disruptions, whether caused by acts of sabotage, employee error, malfeasance or other actions, could have an adverse impact on the Company’s operations as well as the operations of the Company’s customers and suppliers.

Some of the Company’s systems use open source software, which can create additional risks, including potential security vulnerabilities.

Other business disruptions may also be caused by security breaches, which could include, for example, attacks on information technology and infrastructure by hackers, viruses, breaches due to employee error, malfeasance or other actions or other disruptions.

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Like most major corporations, DuPont is the target of industrial espionage, including cyber-attacks, from time to time.

DuPont continues to experience an increase in attempts to breach its information technology systems, including in conjunction with implementation of work-from-home protocols adopted in response to COVID-19.

These cyber-security threats include phishing, spam emails, hacking, social engineering, and malicious software.

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Although management does not believe that DuPont has experienced any material losses to date related to these security breaches, including cybersecurity incidents, there can be no assurance that DuPont will not suffer such losses in the future.

DuPont has engaged and expects to continue to engage in merger & acquisition activity.

DuPont has engaged and expects to continue to engage in merger and acquisition activity.

As part of preparatory and post-closing integration activities, the Company:

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However, DuPont may be unable to obtain or enforce its intellectual property rights in key jurisdictions for various reasons including government policies and regulations, and changes in such policies and regulations, including changes made in reaction to pressure from non-governmental organizations, or the public generally, which could impact the extent of intellectual property protection afforded by such jurisdictions.

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DuPont has designed and implemented internal controls intended to restrict access to and unauthorized use of the Company’s confidential information and trade secrets.

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In connection with completed acquisitions, DuPont has recorded goodwill and other intangible assets on our balance sheet.

As a result of the DWDP Merger and related acquisition method of accounting, EID’s assets and liabilities were remeasured and DowDuPont recognized them at fair value.

Since certain of the Company's assets, especially those related to the Materials & Mobility and Water & Protection segments and those carried at Corporate at December 31, 2021 are heritage EID, declines, if any, in projected cash flows could have a material, negative impact on the fair value of the Company’s reporting units and assets.

As a result of the DWDP Merger and related acquisition method of accounting, EIDP’s assets and liabilities were remeasured and DowDuPont recognized them at fair value.

Since certain of the Company's assets, especially those related to the Water & Protection and Electronics and Industrial segment, and those carried at Corporate & Other at December 31, 2022 are heritage EIDP, declines, if any, in projected cash flows could have a material, negative impact on the fair value of the Company’s reporting units and assets.

In accordance with US GAAP, at least annually, DuPont must assess both goodwill and indefinite-lived intangible assets for impairment.

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The Company’s profitability and margin growth will depend in part on the Company’s ability to maintain a streamlined operating model and drive sustainable improvements, through actions and projects, such as consolidation of manufacturing facilities, transitions to cost-competitive regions and product line rationalizations.

A variety of factors may adversely affect the Company’s ability to realize the targeted cost synergies, including failure to successfully optimize the Company’s facilities footprint, the failure to take advantage of the Company’s global supply chain, the failure to identify and eliminate duplicative programs.

There can be no assurance that DuPont is be able to achieve or sustain any or all of the cost savings generated from restructuring actions.

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There can be no assurance that DuPont will be able to achieve or sustain any or all of the cost savings generated from restructuring actions.

The Company’s results will be affected by competitive conditions and customer preferences.

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and (vi) the mega-trends in digital transformation, connectivity, automation and ethics, environmental impact and sustainability driven purchasing decisions.

Demand for product offerings that are less carbon-intensive and help customers reduce GHG emissions is expected to continue to increase, driven by end-user and customer demand, investor preference, and government legislative and market- and product-specific actions in response to risks created by climate change.

Demand for product offerings that are less carbon-intensive or customers determine support their respective sustainability goals, is expected to continue to increase, driven by end-user and customer demand, investor preference, and government legislative and market- and product-specific actions in response to risks created by climate change.

Failure to timely react to these trends and manage the Company’s product portfolio and innovation activities responsively could decrease the competitiveness of the Company’s products and result in the de-selection of the Company as a partner of choice.

In addition, the failure to set and make progress, commensurate with relevant market competitors, toward the Company’s ESG goals, could harm the Company’s reputation, and its ability to compete and to attract top talent, and could result in increased investor activism.

Additionally, success in achieving the Company’s growth objectives is significantly dependent on the timing and market acceptance of the Company’s new product offerings, including the Company’s ability to renew the Company’s pipeline of new product offerings and to bring those offerings to market.

In addition, the failure to set goals, take actions, make progress and report against, commensurate with relevant market competitors, the Company’s sustainability strategy, could harm the Company’s reputation, and its ability to compete and to attract top talent, and could result in increased investor activism and the deselection of the Company as a partner or supplier of choice.

Success in achieving the Company’s growth objectives is significantly dependent on the timing and market acceptance of the Company’s new product offerings, including the Company’s ability to renew the Company’s pipeline of new product offerings and to bring those offerings to market.

This ability may be adversely affected by difficulties or delays in product development, such as the inability to identify viable new products, obtain adequate intellectual property protection, or gain market acceptance of new products.

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If DuPont is unable to generate sufficient cash flow or maintain access to adequate external financing, including from significant disruptions in the global credit markets, it could restrict the Company’s current operations, activities under its current and future stock buyback programs, and the Company’s growth opportunities, which could adversely affect the Company’s operating results.

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A significant percentage of the Company’s net sales are generated from the Company’s international operations and are subject to economic, geo-political, foreign exchange and other risks.

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dollar, which could adversely affect the Company’s results of operations.

For its continuing operations as of the year ended December 31, 2021, the Company’s largest currency exposures are the European euro, Chinese renminbi, and Japanese yen.

For its continuing operations as of the year ended December 31, 2022, the Company’s largest currency exposures are the Chinese renminbi, European euro, Japanese yen, South Korean won and Canadian dollar.

dollar fluctuations against foreign currency have an impact to commercial prices and raw material costs in some cases and could result in local price increases if the price or raw material costs is denominated in U.S.

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Risks Related to Regulatory Changes and Compliance

Risks related to trade disputes, regulations and policies could adversely impact DuPont’s results of operations.

Trade regulations, policies and disputes can and have increased tariffs, trade barriers, limited the Company’s ability to sell certain products to certain customers, and otherwise impacted the Company’s global supply and distribution chains and research and development activities.

In particular, trade tensions between the US and China have led to increased trade restrictions on the semiconductor business, particularly exports to China of US-regulated products and technology, that have affected downstream demand impacting ordering patterns from certain DuPont Electronics & Industrial’s customers.

Continuing or expanding trade restrictions or disputes could adversely impact demand for and manufacture, distribution or sale of the Company’s products, and restrict access to certain markets, any of which could have a material adverse effect on the Company’s results of operations and growth prospects.

The costs of complying with evolving regulatory requirements could negatively impact the Company’s business, results of operations, financial condition and cash flows.

Actual or alleged violations of environmental laws or permit requirements could result in restrictions or prohibitions on plant operations and substantial civil or criminal sanctions, as well as the assessment of strict liability and/or joint and several liability.

DuPont continues to be subject to extensive federal, state, local and foreign laws, regulations, rules and ordinances relating to pollution, protection of the environment, greenhouse gas emissions, and the generation, storage, handling, transportation, treatment, disposal and remediation of hazardous substances and waste materials.

DuPont continues to be subject to extensive federal, state, local and foreign laws, regulations, rules and ordinances relating to pollution, protection of the environment, product content, greenhouse gas emissions, and the generation, storage, handling, transportation, treatment, disposal and remediation of hazardous substances, which include certain substances of concern, and waste materials.

Costs and capital expenditures relating to environmental, health or safety matters are subject to evolving regulatory requirements and depend on the timing of the promulgation and enforcement of specific standards which impose the requirements.

Moreover, changes in environmental regulations could inhibit or interrupt the Company’s operations, or require modifications to the Company’s facilities.

Moreover, changes in the regulatory environment could inhibit or interrupt the Company’s operations, require modifications to the Company’s products, processes or facilities or cause the Company to discontinue or relocate the production

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of certain products.

Changes to regulations or the implementation of additional regulations, may result in significant costs or capital expenditures or require changes in business practice that could result in reduced margins or profitability.

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federal, state, and local regulations on manufacturing or labeling;

environmental, health and safety regulations;

packaging, environmental, health and safety regulations;

and customer product liability claims.

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In addition, negative publicity related to product liability, safety, health and environmental matters may damage the Company’s reputation.

Changes in tax rates, adoption of new tax legislation and the distribution of income among the various jurisdictions in which the Company operates, could adversely impact DuPont’s results of operations.

Changes in the global and local tax regulatory environments in, and the distribution of income among, the various jurisdictions in which the Company operates, could adversely impact DuPont’s results of operations.

DuPont's future results of operations could be adversely affected by changes in the effective tax rate as a result of a change in the mix of earnings in countries with differing statutory tax rates, changes in tax laws, regulations and judicial rulings (or changes in the interpretation thereof), changes in generally accepted accounting principles, changes in the valuation of deferred tax assets and liabilities, changes in the amount of earnings permanently reinvested offshore, the results of audits and examinations of previously filed tax returns and continuing assessments of the Company’s tax exposures and various other governmental enforcement initiatives.

The Company’s tax expense includes estimates of tax reserves and reflects other estimates and assumptions, including assessments of future earnings of the Company which could impact the valuation of the Company’s deferred tax assets.

Changes in tax laws or regulations, including further regulatory developments arising from proposed U.S.

tax legislation, the final form of which is uncertain;

multi-jurisdictional changes enacted in response to the action items provided by the Organization for Economic Co-operation and Development (OECD);

On August 16, 2022, the Inflation Reduction Act of 2022 (the “IRA”) was enacted into law in the United States.

Among other changes to the Internal Revenue Code of 1986, as amended (the “Code”), the IRA imposes a 15% corporate alternative minimum tax on certain corporations (the “CAMT”).

Changes in tax laws or regulations, including further regulatory developments in connection with the IRA;

multi-jurisdictional changes enacted in response to the action items provided by the Organization for Economic Co-operation and Development (OECD) including the OECD's Global Anti-Base Erosion ("GloBE) rules under Pillar Two, which is expected to introduce a global minimum corporate tax rate set at 15% on multinational enterprises;

and the OCED’s, European Commission’s and other major jurisdiction’s heightened interest in and taxation of large multi-national companies, increase tax uncertainty and impact the Company’s effective tax rate and provision for income taxes.

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The Company operates globally, including in parts of the world that are recognized as having governmental and commercial corruption and where local customs and practices can be inconsistent with anti-corruption and/or anti-bribery laws.

Despite the Company’s training and compliance program, DuPont cannot ensure that its internal control processes will prevent improper action by employees, agents, distributors, suppliers or business partners.

Despite the Company’s training and compliance program, DuPont

Table of Conten ts

cannot ensure that its internal control processes will prevent improper action by employees, agents, distributors, suppliers or business partners.

1 unchanged sentence

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 1A. Risk Factors