What changed in this filing

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Item 1. Business

2022-03-01 compared with 2021-03-17 · 160 added, 189 removed, 258 unchanged (57% of the section changed)

PQ Group Holdings Inc.

(“PQ Group Holdings” or the “Company”) was incorporated in Delaware on August 7, 2015.

PQ Holdings Inc.

(“PQ Holdings”), a manufacturer of specialty catalysts, chemicals and services, was incorporated in Delaware on June 22, 2007.

Founded in 1831, our business has a nearly 200-year history of innovation, enabling environmental improvements in areas such as fuel efficiency and emissions, and healthier personal care products, while improving the sustainability of our planet.

On May 4, 2016, we consummated a series of transactions (the “Business Combination”) to reorganize and combine the businesses of PQ Holdings and Eco Services Operations LLC under a new holdings company, PQ Group Holdings.

On October 3, 2017, PQ Group Holdings completed its initial public offering (“IPO”).

Our common stock is listed on the New York Stock Exchange under the stock ticker “PQG”.

Unless the context otherwise indicates, the terms “PQ Group Holdings Inc.,” “we,” “us,” “our,” or the “Company” mean PQ Group Holdings Inc.

(“Ecovyst” or the “Company”), formerly PQ Group Holdings Inc.

(“PQ Group Holdings”) was incorporated in Delaware on August 7, 2015.

We trace our roots to 1831, and our business has a nearly 200-year history of innovation, enabling environmental improvements in areas such as fuel efficiency and emissions, while improving the sustainability of our planet.

On May 4, 2016, we consummated a series of transactions (the “Business Combination”) to reorganize and combine the then-existing businesses with Eco Services Operations LLC under a new holdings company, then called PQ Group Holdings.

On October 3, 2017, we completed our initial public offering (“IPO”).

On August 1, 2021, we changed our name from “PQ Group Holdings Inc.” to “Ecovyst Inc.”, changed the ticker symbol of our common stock listed on the New York Stock Exchange from “PQG” to “ECVT” and rebranded our former segments from “Refining Services” to “Ecoservices” and “Catalysts” to “Catalyst Technologies.” Our common stock is listed on the New York Stock Exchange under the stock ticker “ECVT”.

Unless the context otherwise indicates, the terms “Ecovyst Inc.,” “we,” “us,” “our,” or the “Company” mean Ecovyst Inc.

and our subsidiaries.

On December 14, 2020, PQ Group Holdings completed the sale of its Performance Materials business to Potters Buyer, LLC (the “Purchaser”), an affiliate of The Jordan Company, L.P., for a purchase price of $650 million, which was subject to certain adjustments for indebtedness, working capital, and cash at the closing of the transaction.

On December 14, 2020, we completed the sale of our Performance Materials business to Potters Buyer, LLC (the “Purchaser”), an affiliate of The Jordan Company, L.P., for a purchase price of $650 million, which was subject to certain adjustments for indebtedness, working capital, and cash at the closing of the transaction.

The results of operations, financial condition, and cash flows for the Performance Materials businesses are presented herein as discontinued operations.

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Refer to Note 4 to our Consolidated Financial Statements for additional information.

On March 1, 2021, PQ Group Holdings announced the entry into a definitive agreement to sell its Performance Chemicals business to a partnership established by Cerberus Capital Management, L.P.

and Koch Mineral & Trading LLC for a purchase price of $1.1 billion, which is subject to certain adjustments including for indebtedness, cash, working capital and transaction expenses.

The transaction is expected to be completed in 2021.

We are an integrated global provider of specialty catalysts, chemicals and services that enable environmental improvements and enhance consumer and industrial produc ts.

Effective on August 1, 2021, we completed the sale of our Performance Chemicals business for $1.1 billion, subject to certain adjustments set forth in the agreement.

We used a portion of the net cash proceeds to repay the entire Senior Secured Term Loan Facility due February 2027 of $231.4 million and the 5.750% Senior Notes due 2025 (the “Senior Notes”) of $295.0 million.

The Senior Notes were redeemed at a redemption price equal to the sum of 102.875% of the principal amount of the Senior Notes plus accrued and unpaid interest to, but excluding, August 2, 2021.

Additionally, our Board of Directors (the “Board”) declared a special cash dividend of $3.20 per share, payable on August 23, 2021 to shareholders of record as of the close of business on August 12, 2021.

The results of operations, financial condition, and cash flows for the Performance Chemicals business are presented herein as discontinued operations.

Refer to Note 5 to our Consolidated Financial Statements for additional information.

We are a leading, integrated and innovative global provider of specialty catalysts and services.

We believe that our products, which are predominantly inorganic, and services contribute to improving the sustainability of the environment.

Our value-added products seek to address global demand trends that are often either the subject of significant environmenta l and safety regulations or are driven by consumer preferences for environmentally friendlier alternative products, which provides us with high-margin growth opportunities.

Specifically, our products and solutions help companies produce vehicles with improved fuel efficiency and cleaner emissions.

Our materials are critical ingredients in consumer products that make teeth brighter and skin softer.

Because our products are predominantly inorganic and carbon-free, we believe we contribute to improving the sustainability of our planet.

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Our products typically constitute a small portion of our customers’ overall end-product costs yet are critical to product performance.

We have a near 200-year track record of innovation that is reflected in our technical and production expertise in silicates, silica, zeolites and catalyst technologies.

We have a long track record of innovation that is reflected in our technical and production expertise in silica, zeolites and catalyst technologies.

We are highly diversified by business, geography and end use.

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As a result of our competitive strengths, we have generally maintained stable margins through changing macro economic cycles.

In 2020, we served over 2,000 customers globally across many end uses and, as of December 31, 2020, operated 40 manufacturing facilities which are strategically located acros s five continents.

In 2021, we served global customers across many end uses and, as of December 31, 2021, operated out of 10 strategically located manufacturing facilities.

(1) Percentage calculations include $131.3 million of total sales attributable to the Zeolyst Joint Venture (“Zeolyst JV”), which represents 50% of its total sales for the year ended December 31, 2021.

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(2) Based on the delivery destination for products sold in 2021.

We intend to capitalize on our strong business foundation, market-based approach, and experienced management team to grow sales profitably, maintain high margins, deploy capital efficiently and generate free cash flow in order to create shareholder value.

We believe that our long history of operational excellence and proven reliability, technology leadership, strong customer relationships, innovation track record and consistent business execution developed from our almost two centuries of combined industry experience positions us well to execute our business strategy.

We intend to capitalize on our strong business foundation, sustainability driven innovation and customer partnerships to grow sales profitably, maintain high margins, deploy capital efficiently and generate free cash flow in order to create shareholder value.

We believe that our long history of operational excellence and proven reliability, technology leadership, strong customer relationships, innovation track record and consistent business execution developed from our industry experience positions us well to execute our business strategy.

Our industry is characterized by constant development of new products and the need to support customers with new product innovation and technical services to meet their needs, coupled with consistent product quality and a reliable source of supply in a safe and environmentally sustainable manner.

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Sales and Zeolyst JV Total Sales (1)

Key End Uses 2020 2019 2018 Significant Growth Drivers Key PQ Products

Key End Uses 2021 2020 2019 Significant Growth Drivers Key Ecovyst Products

Fuels & Emission Controls 46% 51% 54% • Global regulatory requirements to:

• Refinery catalysts

• Refinery hydrocracking catalysts

• Remove nitrogen oxides from emissions • Emission control catalysts

• Remove sulfur from diesel and gasoline • Catalyst recycling services

• Increase gasoline octane in order to improve fuel efficiency while lowering vapor pressure to regulated levels

• Remove sulfur from diesel and gasoline • Catalyst recycling regeneration services

• Increase gasoline octane in order to improve fuel efficiency while lowering vapor pressure to regulated levels • Acid regeneration

• Improve lubricant characteristics to improve fuel efficiencies

Consumer Products 19% 19% 20% • Substitution of silicate materials for less environmentally friendly chemical additives in detergent and cleaning end uses • Silica gels for edible oil and beer clarification

• Demand for improved quality and shelf life of beverages • Precipitated silicas and zeolites for the surface coating, dentifrice, and dishwasher and laundry detergent applications

• Demand for improved oral hygiene and appearance

Packaging & Engineered Plastics 17% 17% 17% • Demand for increased process efficiency and reduction of by-products in production chemicals • Catalysts for high-density polyethlene and chemicals syntheses

• Demand for high-density polyethlene lightweighting of automotive components • Antiblocks for film packaging

• Silicate for catalyst manufacturing

Industrial & Process Chemicals 28% 27% 28% • Demand in the tire industry for reduced rolling resistance • Silicate precursors for the tire industry

• Usage of silicate in municipal water treatment to inhibit corrosion in aging pipelines

Natural Resources 10% 9% 10% • More environmentally friendly drilling fluids for oil and gas production • Silicates for drilling muds

• Recovery in global oil drilling/U.S.

Packaging & Engineered Plastics 31% 27% 26% • Demand for increased process efficiency and reduction of by-products in production chemicals • Catalysts for high-density polyethylene and chemicals syntheses

• Demand for high-density polyethylene and nylon lightweighting of automotive components • Antiblocks for film packaging

• Sulfur derivatives for nylon production

Industrial & Process Chemicals 12% 11% 11% • Demand for a wide range of products including construction materials, auto, consumer goods, and chemicals • Sulfur derivatives for industrial production

• Treatment services

Natural Resources 11% 11% 9% • Recovery in global oil drilling/U.S.

copper production • Sulfuric acid for mining

• Growing demand for lighter weight cements in oil and natural gas wells • Silicates and alum for water treatment mining

• Bleaching aids for paper

• Demand for metals and minerals for low carbon technologies and infrastructure

(1) Percentage calculations include $131.3 million, $128.6 million and $170.3 million of total sales attributable to the Zeolyst JV, which represents 50% of its total sales for each of the years ended December 31, 2021, 2020 and 2019, respectively.

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Increased use of plastics as a substitute for heavier and less versatile materials, such as glass and metal, is driving increased global demand for polyethylene capacity expansions and production.

Further, we are seeing expansions shift towards silica-based technology, which we believe will drive growth for our Silica Catalysts product group within our Catalysts segment.

Further, we are seeing expansions shift towards silica-based technology, which we believe will drive growth for our Silica Catalysts product group within our Catalyst Technologies segment.

Light- and heavy-duty diesel engines are subject to a broad set of regulatory requirements and are subject to increasingly strict standards.

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While the US Environmental Protection Agency and European Union have led other nations in terms of standards that limit the amount of nitrogen oxides, carbon dioxide and other emissions for diesel engines, other emerging regions are implementing similar standards, specifically China, with the China VI (equivalent to Euro VI) emission standard enacted in 2020.

Given stringent fuel efficiency standards that are driving the design of new engines and the resulting higher-octane gasoline requirements that can be achieved through alkylate blending, we believe that our Refining Services segment is well positioned to benefit from any related growth in demand for alkylates.

Given stringent fuel efficiency standards that are driving the design of new engines and the resulting higher-octane gasoline requirements that can be achieved through alkylate blending, we believe that our Ecoservices segment is well positioned to benefit from any related growth in demand for alkylate.

We also believe we have opportunities to displace other less environmentally friendly materials for industrial and consumer good applications through our business segments.

Our Refining Services segment is the largest North American recycler and one of the largest consumers of refinery by-products of sulfur, enabling them to be converted to other applications.

In our Catalysts segment, we are helping our customers meet evolving regulatory requirements for the reduction of sulfur from diesel fuel and reduction of NOx emissions from diesel engines through our custom zeolites.

Our Ecoservices segment is the largest North American recycler and one of the largest consumers of refinery by-products of sulfur, enabling them to be converted to other applications.

In our Catalyst Technologies segment, we are helping our customers meet evolving regulatory requirements for the reduction of sulfur from diesel fuel and reduction of NOx emissions from diesel engines through our custom zeolites.

Similarly, our specialty zeolites and silica supported catalysts are enabling our customers to improve fuel economy and utilize renewable resources through development of improved lubricants, lightweight polymers and renewable transportation fuel.

Our Performance Chemicals products are manufactured from commonly found materials such as industrial sand and soda ash, which are more environmentally friendly than carbon-based products.

Leading Supply Positions

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We believe that our global footprint and efficient network of strategically located manufacturing facilities provides us with a strong competitive advantage in serving our customers both globally and regionally, and that it would be costly for our competitors to replicate our network.

In our Catalysts segment, we primarily compete on a global basis.

We are a leading supplier of refinery hydrocracking catalyst finished and support catalysts used to remove sulfur, and emission control catalysts used in the heavy- and light-duty diesel industries to reduce nitrogen oxides emissions.

In our Catalyst Technologies segment, we primarily compete on a global basis.

We are a leading supplier of refinery hydrocracking catalyst used to remove sulfur, and emission control catalysts used in the heavy- and light-duty diesel industries to reduce nitrogen oxides emissions.

We are also a global supplier of silica catalysts and supports for polyethylene manufacturers and the exclusive supplier of methyl methacrylate (“MMA”) catalysts used in the patented Alpha process practiced by a global MMA leader.

In our Refining Services segment, we hold an estimated number one supply share position in the United States in sulfuric acid regeneration based on 2020 sales volume of greater than 50%.

I n our Performanc e Chemicals segment, we are a leading supplier in the United States, Europe and Latin America, and largely support customers with regional and local production due to costs of shipping.

We estimate that we had at least two times the sodium silicate supply share of our nearest competitor based on 2020 sales volume.

In our Ecoservices segment, we hold an estimated number one supply share position in the United States in sulfuric acid regeneration services based on 2021 sales volume of greater than 50%.

Innovation Track Record

A key competitive advantage is derived from our depth of expertise in silicates, silica, zeolites and catalysts technologies.

A key competitive advantage is derived from our depth of expertise in silica, zeolites and catalysts technologies.

Further, we have the ability to tailor and scale specialty grades to meet changing demands and technical support for large scale commercialization.

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Given the long lead-time required for product development and commercialization, which can be up to ten years, we work closely and build long-term relationships with our customers.

In many cases, our relationships have spanned decades given our ability to meet customized specifications and performance characteristics while also maintaining strict quality standards.

In many cases, our

relationships have spanned decades given our ability to meet customized specifications and performance characteristics while also maintaining strict quality standards.

These long-term relationships have allowed us to innovate together with our customers to meet evolving demands.

For example, we have developed zeolite-based catalysts that are an effective and efficient method to reduce pollutants from heavy- and light-duty diesel engines and enable our customers to meet increasingly stringent vehicle emission standards worldwide.

In personal care applications, we have collaborated with leading consumer products companies over a number of years to develop a family of gentle silica-based dentifrice abrasives that produce more effective cleaning toothpastes.

In addition, our proprietary silica catalyst has enabled development of a high strength high-density polyethylene (“HDPE”) resin that is used for making lightweight plastic gasoline tanks for automobiles.

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We collaborate with leading multinational companies that often seek global solutions.

Our customers include large industrial companies such as ExxonMobile, BASF, and Unilever, and global catalyst producers such as Albemarle and W.R.

Our customers include large industrial companies such as Exxon Mobil, BASF, and Unilever, and global catalyst producers such as Albemarle and W.R.

We also supply catalysts to leading chemical and petrochemical producers such as BASF, Dow Chemical, Lucite, LyondellBasell, and Shell.

We supply personal care ingredients and additives to leading consumer products companies such as Unilever and Colgate-Palmolive.

We have long-term relationships with our top ten customers, based on 2021 sales, that average more than 50 years.

In addition, our customer base is diversified, with our top ten customers in 2020 representing approximately 30% of our sales for the year ended December 31, 2020 and no customer representing more than 5% of our sales during this period.

In addition, our customer base is diversified, with our top ten customers in 2021 representing approximately 41% of our sales for the year ended December 31, 2021 (including our proportionate 50% share of sales attributable to the Zeolyst JV), and one customer representing 11% or $78.5 million of our sales in both our Ecoservices and Catalyst Technologies businesses during this period.

Secured Contractual Pass-through of Raw Material Costs Support Stable Margins

We have been able to mitigate the impact of raw material or energy price volatility using a variety of mechanisms, including hedging and raw material cost pass-through clauses in our sales contracts and other adjustment provisions.

For the year ended December 31, 2020, approximately 30% of our Performance Chemicals sales (mostly comprised of sodium silicate sales) were derived from contracts that included raw material pass-through clauses.

Most of our Refining Services contracts feature minimum volume protection and/or quarterly price adjustments for items such as commodity inputs, labor, the Chemical Engineering Plant Cost Index and natural gas.

In 2020, approximately 80% of our Refining Services segment sales were sold under contracts that included some form of raw material pass-through clause.

These price adjustments generally reflect our Refining Services actual cost structure in producing sulfuric acid, and tend to provide us with some protection against volatility in labor, fixed costs and raw material pricing.

Most of our Ecoservices contracts feature minimum volume protection and/or quarterly price adjustments for items such as commodity inputs, labor, the Chemical Engineering Plant Cost Index and natural gas.

In 2021, approximately 80% of our Ecoservices segment sales were sold under contracts that included some form of raw material pass-through clause.

These price adjustments generally reflect our Ecoservices actual cost structure in producing sulfuric acid, and tend to provide us with some protection against volatility in labor, fixed costs and raw material pricing.

Freight expenses are generally passed through directly to customers.

Our products are predominantly inorganic and carbon-free, and are produced from readily available raw materials such as industrial sand and soda ash, which prices have historically been less volatile than oil.

We also use natural gas in our furnaces where our North American facilities have benefited from the plentiful supplies of shale gas.

In addition, we have long-term supply contracts with many of our key raw materials suppliers across all our business segments.

Our products are predominantly inorganic and carbon-free, and are produced from readily available raw materials such as industrial sand and caustic soda, which prices have historically been less volatile than oil.

We also use natural gas in our manufacturing process where our North American facilities have benefited from the plentiful supplies of shale gas.

In addition, we have long-term relationships with many of our key raw materials suppliers across all our business segments.

Long Term Customer Contracts Enhance Sales Predictability and Stability

We partner with many of our customers under long-term contract agreements, mutually exclusive product supply arrangements and/or specified products for certain license production processes.

In our Refining Services segment, approximately 50% of our production capacity serves customers with staggered five to ten year “take or pay” contracts with potential for value pricing resets and cost pass-through for our regeneration services product line that enhances sales and margin predictability and stability.

In our Ecoservices segment, approximately 40% of our production capacity serves customers with staggered five to ten year “take or pay” contracts with potential for value pricing resets and cost pass-through for our regeneration services product line that enhances sales and margin predictability and stability.

Excluding contracts with automatic evergreen provisions, approximately 50% of our sulfuric acid volume for the year ended December 31, 2021 was under contracts expiring at the end of 2022 or beyond.

In our Catalysts segment, we are either the sole or dual supplier to key global customers under various term agreements up to 10 years for each of polyolefin catalysts and silica catalysts supports.

In our Catalyst Technologies segment, we are either the sole or dual supplier to key global customers under various term agreements up to 10 years for each of polyethylene catalysts and silica catalysts supports.

Further, we are an exclusive multi-year supplier of MMA catalyst to a leading global producer.

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These terms, in line with industry standards, provide us with flexibility in satisfying customers.

Our Performance Chemicals segment operates under key customer supply contracts with material cost pass-through ranging from 1 to 5 years, largely depending on terms for customer demand given regional and/or product solution needs.

Strategic and Differentiated Manufacturing Know-how and Supply Chain Global Network

Our manufacturing platform is based on furnace technology and proprietary knowledge developed from almost two centuries of combined experience applying silicates chemistry production and the development of applications across a broadening set of end uses.

All of our segments produce materials through our furnace process, other than our silica catalysts and zeolite catalysts product groups, which are derivatives of our Performance Chemicals segment.

We believe we have a differentiated capability around furnace operations that enables us to operate more efficiently than most of our competitors.

Ecoservices’ predecessor company, Stauffer Chemical, was a leader in pioneering the current sulfuric acid regeneration technology in the 1940s.

Since then, we have leveraged our process technology expertise and ability to deliver our products by barge, rail, truck and pipeline to become the largest sulfuric acid regenerator in North America and a leading North American producer of high quality virgin sulfuric acid.

Ecoservices has also applied its expert knowledge in sulfur chemistry to provide treatment services for hazardous/non hazardous wastes, and most recently activate catalysts with our patented Chem32 technology.

Our Catalyst Technologies product development and manufacturing technology is customized based on deep silica based and zeolite based material science know-how.

Our R&D centers develop fit for purpose catalysts with customers.

We believe we have a differentiated capability to develop such products and manufacture them consistently.

Stable Margins and Cash Flow Generation Across Changing Macroeconomic Cycles

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Our Business Segments

We are an integrated, global provider of specialty catalysts, chemicals and services that share common end uses, manufacturing techniques, and process technology.

We conduct operations through three reporting segments:

(1) Refining Services, (2) Catalysts (including our 50% interest in the Zeolyst Joint Venture) and (3) Performance Chemicals.

Effective October 15, 2020, our former Performance Materials segment was treated as a discontinued operation and was subsequently sold on December 14, 2020.

The table below summarizes certain information regarding our three reporting segments for the year ended December 31, 2020.

We are a leading, integrated and innovative global provider of specialty catalysts and services.

We believe that our products, which are predominantly inorganic, and services contribute to improving the sustainability of the environment.

We conduct operations through two reporting segments:

(1) Ecoservices and (2) Catalyst Technologies (including our 50% interest in the Zeolyst Joint Venture).

The table below summarizes certain information regarding our two reporting segments for the year ended December 31, 2021.

Year ended December 31, 2021

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(in millions, except percentages)

Refining Services $ 401.9 36.3 % $ — 32.5 % $ 157.2 42.0 %

Catalysts 94.0 8.5 % — 7.6 % 74.5 19.9 %

Ecoservices $ 500.5 81.9 % $ — 67.4 % $ 177.7 66.9 %

Catalyst Technologies 110.7 18.1 % — 14.9 % 88.0 33.1 %

Zeolite Catalyst — — % 131.3 17.7 %

Performance Chemicals 614.7 55.5 % — 49.7 % 142.4 38.1 %

Eliminations (3.2) (0.3) % — (0.3) %

Subtotal $ 611.2 100.0 % $ 131.3 100.0 %

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(1) Percentage calculations include $131.3 million of total sales attributable to the Zeolyst JV, which represents 50% of its total sales for the year ended December 31, 2021.

The Adjusted EBITDA of our Catalysts segment includes our 50% portion of the Adjusted EBITDA of our Zeolyst JV.

The Adjusted EBITDA of our Catalyst Technologies segment includes our 50% portion of the Adjusted EBITDA of our Zeolyst JV.

Refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Basis of Presentation” for a description of the treatment of the Zeolyst Joint Venture in our consolidated financial information.

(2) Percentage calculations exclude $3.2 million in intersegment sales eliminations.

(2) Percentage calculations exclude $38.1 million in corporate expenses.

Refining Services

Our Refining Services segment is a leading provider of sulfuric acid recycling (Regeneration Services) and end-to-end logistics to North American refineries for the production of alkylate, a high value gasoline blending component required for meeting gasoline specifications and producing premium grade fuel.

Our Ecoservices segment is a leading provider of sulfuric acid recycling (Regeneration Services) and end-to-end logistics to North American refineries for the production of alkylate, a high value gasoline blending component required for meeting gasoline specifications and producing premium grade fuel.

We are also a leading North American producer of on-purpose virgin sulfuric acid for water treatment, mining, and industrial applications.

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Trends for increased alkylate production are being driven by:

rising demand for premium gasoline used in smaller, more efficient turbocharged engines, which requires higher octane rated gasoline with an alkylate content of approximately 35%-45%, as compared to the 12% alkylate content in regular gasoline;

rising demand for premium gasoline used in smaller, more efficient turbocharged engines, which requires an alkylate content of approximately 35%-45%, as compared to the 12% alkylate content in regular gasoline;

the need for more alkylate to meet the minimum octane ratings in regular gasoline following the continued significant share growth of shale oil refining in the U.S.;

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and rising gasoline exports, which generally contain no ethanol and will generally require more alkylate to replace the ethanol in order to meet the minimum octane requirements for the destination countries.

Our Refining Services segment is highly regionalized due to shipping costs and our customer integration requirements.

Our network of facilities is concentrated in the Gulf Coast and the state of California, where approximately 68% of the United States refining capacity is located.

Our Ecoservices segment is mostly regional due to shipping costs and our customer integration requirements.

Our network of facilities is concentrated in the Gulf Coast and the state of California, where more than 60% of the United States refining capacity is located.

The strategic locations of our plants in these key refining regions contribute to our highly efficient supply chain networks with our customers, including in some cases captive pipelines connecting us to our refinery customers.

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Since storage space for fresh and spent acid is typically limited, and the cost to refineries of interruption to their alkylation units would be significant, refineries seek to have a continuous and reliable source of supply for sulfuric acid.

Our end-to-end regeneration service offering takes the spent acid from the refinery, through our network of plants and transportation systems, and recycles the acid into a high strength fresh acid for reuse in the alkylation process.

Our end-to-end regeneration service offering takes the spent acid from the refinery, through our network of plants and transportation systems, and recycles the acid into high strength fresh acid for reuse in the alkylation process.

Because of the number and strategic locations of our plants, and the breadth of our transportation logistics, we believe we bring the highest reliability and flexibility to our refining customers, allowing them to focus on their core competency by optimizing their alkylation capacity.

Virgin sulfuric acid is created either through the burning of sulfur in furnaces, or as a by-product of other industrial processes, primarily the smelting of copper and other base metals.

We produce a range of high quality virgin sulfuric acid products by burning sulfur in our plants for supply into a diverse set of end uses.

Sulfur-burned acid is generally considered to be of higher purity and quality than smelter-produced acid and, as a result, smelter-produced acid is not suitable for some industrial users including several of our larger customers who require higher quality and differentiated sulfuric acid products, such as super-saturated sulfuric acid (oleum) and other high purity specialty acids.

Our sulfur derived, high quality virgin sulfuric acid products supply a diverse set of end uses.

Sulfur derived acid is generally considered to be of higher purity and quality than smelter-produced acid and, as a result, smelter-produced acid is not suitable for some industrial users including several of our larger customers who require higher quality and differentiated sulfuric acid products, such as super-saturated sulfuric acid (oleum).

Virgin sulfuric acid is produced at all of our facilities utilizing the same production equipment as our regeneration services.

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Regenerated sulfuric acid is produced by thermally decomposing the spent acid in our furnace into a clean gas stream which is converted into sulfuric acid.

Virgin sulfuric acid is produced by burning sulfur and certain sulfur-rich components at high temperatures within a furnace.

The chart below summarizes the manufacturing platform for our Refining Services segment.

Refining Services Manufacturing Platform

Virgin sulfuric acid is produced by burning sulfur and certain sulfur-rich components at high temperatures within a furnace to create a gas stream.

The chart below summarizes the manufacturing platform for our Ecoservices segment.

Ecoservices Manufacturing Platform

Catalyst Technologies

We are a leading global provider of customized and innovative catalyst products and process solutions to leading producers and licensors of polyethylene, or PE, and methyl methacrylate, or MMA.

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Because these catalysts are highly technical and customized for our customers to produce resins with specific properties, they are often covered under long-term supply agreements and, in some cases, we are a customer’s sole source supplier.

In addition, we produce silica anti-blocking products that are used to prevent opposite faces of polyolefin and polyester films from adhering to one another during manufacturing and in use.

In addition, we produce silica anti-blocking products that are used to prevent opposite faces of polyethylene and polyester films from adhering to one another during manufacturing and in use.

The Zeolyst Joint Venture, (formed in 1988 specifically as Zeolyst International and Zeolyst C.V., our 50% owned joint venture with Shell Catalysts & Technologies, an affiliate of Royal Dutch Shell plc.

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We also supply custom zeolites to catalyst companies who compete in similar industries.

The Zeolyst Joint Venture leverages each partner’s technology and production expertise, including Shell’s expertise in hydrocracking catalyst to maximize liquid product yields, especially distillate while at the same time removing sulfur, and PQ’s expertise in zeolite technology.

We also believe the Zeolyst Joint Venture is a first mover in zeolite fuels and emissions control technology and we expect continued expansion as environmental emissions standards increase globally.

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We believe that our zeolite catalysts can enable selective catalytic reduction technology to reduce the amount of nitrogen oxides in such exhaust gases by more than 90% and is one of the most cost-effective methods to reduce diesel engine emissions.

Our Silicia Catalysts product group primarily competes with W.R.

Our Silica Catalysts product group primarily competes with W.R.

The Zeolyst Joint Venture competes with global catalyst producers such as W.R Grace, BASF, UOP, Axens, and Haldor Topsoe, while at the same time providing many of them customized zeolite solutions for their product offerings.

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Manufacturing

We manufacture our catalyst products using sodium silicate liquids purchased directly from our Performance Chemicals segment or silica sol liquids made by others from Performance Chemicals sodium silicate to make specialty zeolite and silica products.

We manufacture our catalyst products using sodium silicate to make specialty zeolite and silica products.

These zeolites and silicas are either used directly to produce catalysts or are sold as precursors to other catalyst manufacturers.

The chart below summarizes the manufacturing platform for our Catalysts segment.

The chart below summarizes the manufacturing platform for our Catalyst Technologies segment.

Silica Catalysts Manufacturing Platform

Zeolyst Joint Venture Manufacturing Platform

Performance Chemicals

Our Performance Chemicals segment is a leading global producer of sodium silicates, and downstream specialty silicas as well as other silicate derivative products.

These products are used in a wide variety of industrial and consumer applications such as matting agents in surface coatings, clarifying agents for edible oils and beverages, precursors for green tires, additives for dental cleaning and personal care products, and as feedstock for our additives and catalyst platforms.

Given our products are derived from quartz sand, which makes them natural and inert materials, we believe they have the environmental and safety profile to address evolving customer demands to replace certain other chemicals.

Silicates and silicate derivatives are recognized on the Safer Chemicals Ingredients List of the EPA’s Safer Choice program, which we believe positively impacts our ability to compete in consumer product applications.

Given the breadth of our global infrastructure in terms of scale operations, geographic diversity and production know-how, we are a leading global supplier to key multi-national industrial and consumer product companies.

While we are global, our network is highly regionalized in silicate products and strategically located to support customers in a cost effective manner because of the expense of shipping sodium silicates extended distances due to their water content.

We believe that we are the only global silicates producer who can supply all of the major regions, excluding China, and we estimate that we hold at least two times the sodium silicates supply share as our nearest competitor based on 2020 sales volume.

Our product groups include Sodium Silicates, Specialty Silicas and Other Silicate Derivatives.

Sodium Silicates have functional attributes that are used as additives and ingredients to enhance product performance as binders, detergent-builders, pH buffers, adhesives or as chemical feedstock and are in extensive diverse customer applications for construction, cleaning, water treatment, pulp & paper, foundry & refractory, green tires, electronics and refining catalysts.

Specialty Silicas are used as ingredients in consumer products such as personal care products, food, edible oils and beer where customers are seeking more environmentally friendly products without loss of effectiveness or performance.

In industrial, uses include gloss control and corrosion control in coil, wood, general industrial leather, and other high-performance surface coating applications.

Other Silicate Derivatives include metasilicates, spray dried silicates, and magnesium silicates and potassium silicates which supply diverse uses in cleaning, specialty fertilizer, oil & gas, mining, paints, food, and cosmetics.

We also produce zeolites, by reaction with aluminum trihydrate, which are used as builders in detergents and in other applications as stabilizers in the production of polyvinylchloride (PVC) applications.

In our Performance Chemicals segment, we primarily compete with other global producers such as OxyChem, Grace and Evonik.

We believe that we have a leading industry position and technical expertise that provides us with a competitive advantage over competitors who manufacture only in particular end uses.

Further, we believe that it would be costly and difficult for a new entrant or existing competitor to replicate our breadth or economies of scale in the production of sodium silicate.

We believe that our network of strategically located manufacturing facilities, with operations in North America, Europe, South America and Africa, allows us to serve our customers at a lower cost than our competitors and with quicker delivery times for our products.

In the industry, we compete primarily on the basis of performance, product consistency, quality, reliability, and ability to innovate in response to customer demands.

Manufacturing

Performance Chemicals’ products are produced through an integrated supply chain beginning with regional and large scale upstream production of sodium silicates and downstream derivatives.

Sodium silicates are produced regionally because of the expense of shipping sodium silicates extended distances due to their water content.

Our sodium silicates are produced by fusing readily available industrial sand and soda ash in our proprietary furnace operations.

We dissolve the molten silicate from the furnace into water and sell these products in liquid form.

Downstream derivatives are produced through a variety of chemical operations that create aqueous, solid, and gel forms for our products.

For the year ended December 31, 2020, approximately 50% of our North American silicate sales, which represented a significant portion of our Performance Chemicals segment sales, were derived from contracts that included raw material cost pass-through clauses.

Under these contracts, there is usually a time lag of between three and nine months for cost changes to pass-through, depending on the magnitude of the change, industry dynamics and the terms of the particular contract.

The chart below summarizes the manufacturing platform for our Performance Chemicals segment.

Performance Chemicals Manufacturing Platform

Raw Materials

We estimate that our raw material costs represent approximately 40% of total cost of goods sold in the year ended December 31, 2020.

We also use natural gas in our furnaces, with our North American facilities benefiting from the plentiful supplies of shale gas.

In addition, we have long-term supply contracts with many of our key raw materials suppliers across our segments.

We have also been able to mitigate the impact of raw material or energy price volatility using a variety of mechanisms, including hedging and raw material cost pass-through clauses in our sales contracts and other adjustment provisions.

We also use natural gas in our manufacturing process, with our North American facilities benefiting from the plentiful supplies of shale gas.

In addition, we have long-term supply relationships with many of our key raw materials suppliers.

We have also been able to mitigate the impact of raw material or energy price volatility using a variety of mechanisms, including cost pass-through clauses in our sales contracts and other adjustment provisions.

We are able to negotiate our supply agreements for our key raw materials based on our leading industry position and global scale in an effort to achieve competitive pricing.

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Key Raw Materials Segments

Soda Ash Refining Services, Performance Chemicals

Sodium hydroxide ("caustic soda") Refining Services, Performance Chemicals

Sulfur Refining Services

Industrial sand Performance Chemicals

Aluminum trihydrate Refining Services, Performance Chemicals

Sodium hydroxide ("caustic soda") Ecoservices

Sulfur Ecoservices

Sodium silicate Catalyst Technologies

While natural gas is not a direct feedstock for any individual product, we use natural gas powered furnaces to heat raw materials and create the chemical reactions necessary to manufacture our products.

We maintain multiple suppliers wherever possible and we seek to hedge our exposure to fluctuations in prices for natural gas, forward purchases of natural gas in the United States, Canada, and Europe, and the use of pass-through clauses for raw material and natural gas costs in our customer contracts.

We maintain multiple suppliers wherever possible and we seek to hedge our exposure to fluctuations in prices for natural gas, forward purchases of natural gas and the use of pass-through clauses for raw material and natural gas costs in our customer contracts.

However, we may not be successful in passing through all increases in raw material costs or maintaining an uninterrupted supply of natural gas for all of our furnaces.

See “Risk Factors-Risks Related to Our Business — If we are unable to pass on increases in raw material prices, including natural gas, to our customers or to retain or replace our key suppliers, our results of operations and cash flows may be negatively affected”.

Joint Ventures

We have entered into several long-standing joint ventures to supplement our businesses and access other geographic locations, minimize costs and accelerate growth in areas we believe have significant business potential, with the most significant of these joint ventures including the following:

Zeolyst Joint Venture

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We have a 50% ownership stake in the Zeolyst Joint Venture.

We supply sodium silicate from our Performance Chemicals segment to the Zeolyst Joint Venture to make specialty zeolites, which are used as precursors in emission control and custom catalysts.

We also produce specialty zeolites that are precursors for the production of hydrocracking catalyst and other refinery and petrochemical catalysts that are used by our other segments and sold to third parties.

We produce specialty zeolites that are precursors for the production of hydrocracking catalyst and other refinery and petrochemical catalysts that are used by our other segments and sold to third parties.

We manage the production of these specialty zeolites due to our expertise in zeolite production.

These catalysts include aromatic catalysts that upgrade aromatic by-product streams, dewaxing catalysts that improve lube oil performance and diesel cold flow performance, and paraffin isomerization catalysts that upgrade olefins to high octane gasoline blending components for refinery and petrochemical customers.

PQ Holdings Mexicana S.A.

PQ Holdings Mexicana was established in 2000 as a joint venture with Solvay Alkalis, Inc.

for the manufacture, marketing and sale of various chemicals, including sodium silicate, through manufacturing facilities in Tlalnepantla and Guadalajara, Mexico.

We have an 80% ownership stake in PQ Holdings Mexicana.

Research and Development

We benefit from the highly-skilled technical capabilities of our employees dedicated to new product development.

We operate four research and development facilities in the United States, Canada, the United Kingdom and the Netherlands.

We operate two research and development facilities in the United States and the United Kingdom.

Our research and development activities are directed toward the development of new and improved products, processes, systems and applications for customers.

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Including our joint ventures, we are party to certain arrangements whereby we license in the right to use certain intellectual property rights in connection with our business.

Our Refining Services segment typically experiences seasonal fluctuations as a result of higher demand for gasoline products in the summer and lower demand in the winter months.

These demand fluctuations results in higher sales and working capital requirements in the second and third quarter.

Environmental Stewardship

Our Ecoservices segment typically experiences seasonal fluctuations as a result of higher demand for gasoline products in the summer and lower demand in the winter months.

These demand fluctuations results in higher sales and working capital requirements in the second and third quarters.

Sustainability Overview

Sustainability is intertwined with our daily business and is reinforced through our strategy and values.

Our diverse product technologies enable downstream sustainability.

Our Performance Chemicals segment provides products that are designed to support bio-fuel purification, specialty silicas for low-VOC environmentally preferred coatings, and our sodium silicates are designed to extend the durability of municipal water treatment pipelines by inhibiting corrosion.

Our Refining Services segment regenerates sulfuric acid for the refining industry avoiding significant landfill or deep well disposal annually.

Certain of our Catalyst segment’s products are designed to reduce pollutants, such as nitrous oxides (NOx) in vehicle exhaust and by removing sulfur from fuels.

Our global product technology team formalized its ideation process in 2019 and continues to drive transformational growth through innovation.

The team considers product sustainability across the life-cycle in its stage-gate process.

As an American Chemistry Council (“ACC”) Responsible Care® member company, we continue to report our health, safety, and environmental metrics annually.

Our sustainability metrics, including waste generation and water consumption for 2018 and 2019, have been third party assured in 2020.

On the sustainability pages of our website, we provided our inaugural sustainability report, including our sustainability goals, materiality matrix, letters of assurance, and the corresponding Global Reporting Initiative (GRI) Disclosure and Sustainability Accounting Standards Board (SASB) Index.

Building on our commitment of improvement across sustainability elements, we selected and began implementation of our corporate-wide sustainability software platform in late 2020.

Upon full implementation of our software in 2021, we plan to introduce our internal real-time sustainability performance dashboard to enable improved analytics and greater visibility into our sustainability impacts.

We strive to create sustainable products that are safe for the environment, reduce waste and increase efficiencies for our customers and stakeholders.

We believe that our products contribute to lower emissions and cleaner air, advance the global transition to clean energy, support the circular plastics economy and ensure clean, purified drinking water.

We are committed to creating environmentally responsible products that we believe make a difference in people’s daily lives and for our planet.

While offering products and services that help our customers to advance their own sustainability goals, we also work to advance our commitment to maintain sound environmental, social and governance (“ESG”) practices, policies and procedures.

For example, in 2021 we:

• Elevated the position of Vice President – Health, Safety, Environment and Sustainability to an executive-level management position that now reports directly to our Chairman, President and CEO;

• Created an executive-level ESG Leadership Team, which is led by our Chairman, President and CEO, to oversee the company’s sustainability goal-setting and efforts to achieve the established goals;

• Developed and announced a series of sustainability goals with respect to greenhouse gas emissions, waste management and reduction, product sustainability/R&D investment and company certifications by 2025 and 2030;

• Undertook a review of our internal policies and procedures to identify and implement additional improvements in a number of areas, including health, safety and environmental (“HSE”) performance;

commitment to diversity, inclusion and human rights both within our company and in our supply chain;

and ethical and lawful business practices;

• Implemented a corporate-wide sustainability software platform, which we plan to utilize as an internal, real-time sustainability performance dashboard to enable improved analytics and greater visibility into our sustainability impacts;

• Achieved record performance in our flagship HSE Perfect Days program, which targets at-risk behaviors and celebrates positive health, safety and environmental performance across the organization on a daily basis.

We achieved a 91% Perfect Days performance across the company in 2021, mirroring our 2020 performance and a vast improvement since the program started in 2018;

• Achieved a Silver Sustainability Score from EcoVadis, a third-party sustainability evaluation company, prior to the sale of Performance Chemicals.

The Silver Score from EcoVadis places us in the 91st percentile of all companies ranked by EcoVadis in our sector group;

• Concluded 2021 with no material environmental and safety incidents.

The sections that follow provide some highlights of our environmental, social, and governance programs and procedures.

Environmental Stewardship.

Our products and technologies continue to address our customers’ sustainability challenges, tightening global regulatory standards and changing consumer preferences.

In our Ecoservices segment, we provide sulfuric acid regeneration services that avoid significant landfill or deep well disposal while enabling the manufacture of cleaner and efficient fuels.

In our Catalyst Technologies segment, our zeolite catalysts are used for cleaner air applications and our silica catalysts are key for light weighting and plastics recycling.

Our innovation investment ratio on new sustainable products has gone from 60% in 2015 to 85% in 2021.

As part of our sustainability commitment regarding our own operations, we apply the principles of the Environmental Management standard of the International Organization for Standardization (ISO 14001) at our facilities throughout the world.

For chemical facilities in the United States, we also adhere to the Responsible Care® RC14001 Technical Specifications of the American Chemistry Council (“ACC”).

We maintain policies and procedures to monitor and control health, safety, and environmental risks, and to monitor compliance with applicable state, national, and international health, safety, and environmental requirements.

We have comprehensive health, safety and environmental compliance, auditing and management programs in place to assist in our compliance with applicable regulatory requirements and with internal policies and procedures, as appropriate.

Each facility has developed and implemented specific critical occupational health, safety, environmental, security and loss control programs.

We also have a strong health, safety and environmental organization staffed by professionals who are responsible for environmental, safety, health and product regulatory compliance.

Our HSE organizational structure features executive management level leadership, active oversight by our Board and dedicated environmental experts on staff.

We have Regional HSE Specialists and Managers who are embedded in the field and provide HSE expertise and support to operating sites.

Certain, larger sites may have dedicated environmental or safety personnel.

As an ACC Responsible Care® member company, we continue to monitor and report our health, safety, and environmental metrics annually.

Our sustainability metrics, including waste generation and water consumption for 2018 and 2019, were third party assured for the first time in 2020.

In 2021, we reviewed our 2020 sustainability metrics and successfully underwent third party verification of this data as well.

We expect to include the assured 2020 data on our web-site and in our next Sustainability Report, which we expect to publish in the second quarter of 2022.

We also have established a Product Safety and Product Stewardship management system that is compliant with the RC14001 technical specification and is supported by a highly skilled Product Stewardship Manager.

We conduct Product

Stewardship reviews as part of new product development and routinely evaluate product safety risk for raw materials, intermediates, and finished products.

Social Responsibility, including human capital discussions.

We are focused on the safety of our employees.

We continued our flagship health, safety and environmental program - PQ Perfect Days (“Perfect Days”).

The Perfect Days program targets at-risk behaviors and celebrates positive health, safety and environmental performance across the organization on a daily basis.

As part of that program, we have set annual Perfect Day and Total Recordable Incident Rate goals and targets that link to performance and drive accountability.

We concluded 2020 with no material environmental and safety incidents or accidents and achieved our 2020 target of ACC top quartile total case incident rate performance based upon 2019 benchmark data.

The COVID-19 pandemic introduced another level of health and safety performance concerns in 2020 as the entire globe entered the COVID-19 pandemic.

We quickly introduced, and have maintained protocols to minimize risk of exposure and transmittal within all of our work sites so that we could continue to provide for all of our customers while keeping our employees safe and healthy.

Our executive leadership across the organization, led by our Chairman and CEO, formed our COVID Rapid Response Team (CRRT).

The team has worked to maintain our health and safety standards while effectively managing COVID-19 impacts to the business and our sites.

The team’s responsibilities include tracking and implementing government requirements and CDC guidelines to enable appropriate actions be taken;

leading communications to our employees, customers, and entire supply chain;

and sharing best practices and lessons learned from our response.

Business leadership executed established business continuity plans, which included our market response with the primary goal of safeguarding the health and safety of our people and supporting the needs of our customers, while also maximizing productivity for the Company.

Further in 2020, the leadership and rapid response teams prepared guidance for all sites and functions, which included preventative measures and return-to-work procedures.

Operations shifts were adjusted, up to and including temporary shutdowns as necessary, to minimize exposures and to protect all personnel.

Most of the practices remain in place today and are now part of our preparation standards.

We seek to act in a socially responsible manner through our various HSE programs as described above, our commitment to building a diverse and inclusive workforce, engagement with and support for the communities where we live and work, and advancement of socially responsible business practices through partnerships and other industry frameworks.

We are committed to providing equal employment opportunities for all employees and applicants for employment, and does not discriminate on the basis of race, color, religion, sex, sexual orientation, pregnancy, gender identity and expression, national origin, disability, age (40 or above), ancestry, genetic information, marital status, veteran status or any other classification protected by law.

This commitment applies to all terms and conditions of employment including recruiting, hiring, placement, advancement, training, transfer, demotion, lay off and recall, termination, compensation and benefits.

It is our policy to comply with all applicable laws and regulations in each jurisdiction in which we operate in order to provide appropriate working conditions for our colleagues.

This means that we comply with applicable laws regarding the employment relationship including those that (1) prohibit child labor, (2) set acceptable working conditions and working hours, (3) provide for fair wages, including minimum wages and overtime, (4) prohibit forced or bonded labor, (5) permit freedom of association and collective bargaining, and (6) prohibit discrimination, harassment and other forms of degrading or inhumane treatment.

Using tools such as our Supplier Code of Conduct and contractual provisions, we also hold our business partners to these same standards.

Our flagship “Success through People” program furthers our strategy by acknowledging our workforce is key to our success.

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We actively promote diversity within the Company and seek to have a workforce that reflects the diversity of the societies in which we operate.

We strive to hire candidates from diverse backgrounds, cultures and ethnicities.

Building on a global footprint that spans across 16 countries, we benefit from our talented and dedicated employees that make up a diverse population, where more than half of our workforce of 2,274 employees are located outside the United States.

As of December 31, 2020, we had 2,274 employees worldwide, of which 1,019 were employed in the United States, 343 were employed in Canada, Mexico, and Brazil, 735 were employed throughout Europe, 37 were employed in South Africa and 95 were employed in Indonesia.

Our remaining employees are dispersed throughout Asia, primarily in Thailand.

We benefit from our talented, dedicated and diverse employee population.

As of December 31, 2021, we had 883 employees worldwide, of which 766 were employed in the United States and the remainder outside of the United States.

Further, at December 31, 2021, approximately 25% of our U.S.-based executives, managers and professionals were females and 16% were non-white males.

As of December 31, 2021, approximately 35% of our employees were represented by a union, works council or other employee representative body.

We believe we have good relationships with our employees and their respective works councils, unions or other bargaining representatives.

Further, at December 31, 2020, approximately 25% of our U.S.-based executives, managers and professionals were women.

This international strength, supported by our core values of integrity and fairness, fosters a rich culture founded on diverse of thought.

This international strength, supported by our core values of integrity and fairness, fosters a rich culture founded on diversity of thought.

We firmly believe that success is achieved through the intellect and commitment of our people, so we employ a long-term human capital program to attract, retain and develop talent for the future.

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R&D, Finance, HSE and Human Resources.

While the COVID-19 pandemic limited the opportunities for in-person engagement in our communities, our sites continued to support food security programs and people in need across our global network.

For example, our Hammond site supported efforts to stock food pantries through their participation with the local United Way and Heels for Meals programs.

The Malvern office continued its support for local families with donations to the Pennridge FISH Organization.

Our governance programs and policies can be found in the Company’s Ethics section of the sustainability webpages, which is routinely updated and includes our policies on child labor, human trafficking, anti-harassment, antibribery, and cyber security all of which are evaluated by third-parties, including Ecovadis.

Our 2020 Ecovadis Assessment scored PQ’s Ethics response in the top quartile of our sector category, basic chemicals.

We continue to provide annual Code of Conduct training to all our global employees and have enhanced our delivery with online learning modules.

While the continuing COVID-19 pandemic has limited the opportunities for in-person engagement in our communities, our sites continued to work to have a positive impact in the communities in which we operate.

For example, in 2021 (a) our office in The Woodlands, Texas delivered donated board games, blankets, and other goods to the Montgomery County Community Action Center and also donated canned gods and packed Thanksgiving boxes at the Montgomery County Assistance Center, (b) our Houston, Texas plant made a food donation to a local church, (c) our Hammond, Indiana plant conducted a toiletry drive for needy people, and (d) our Baytown, Texas plant delivered turkeys to a local elementary school to be delivered to local families in need and also performed volunteer hours at the local chamber of commerce in support for a holiday “Cards for Troops” initiative.

We maintain and consistently reinforce within our organization a series of policies and practices designed to ensure that decisions made on behalf of our company are properly made and executed.

Our governance programs and policies start with a strong tone at the top and are summarized in our Executive Statement on Ethics and Compliance, which has been issued by our Chairman, President and CEO and our Chief Compliance Officer and distributed throughout the organization.

The principles set forth in the Executive Statement are codified in our Code of Conduct, which sets forth the legal and ethical standards to which our employees must adhere, including (a) acting with integrity, (b) avoiding actual or apparent conflicts of interest, (c) complying with the rules and regulations of federal, state, provincial, local governments, and other appropriate regulatory agencies, (d) complying with all rules and regulations prohibiting fraud, bribery, corrupt practices, anti-competitive activities and trading with embargoed persons and countries, (e) complying with all company policies and procedures, and (f) actively promoting ethical behavior in the workplace.

We provide annual training on our Code of Conduct to all our global employees and have enhanced our delivery with online learning modules.

Our governance programs and policies can be found in the Company’s Ethics section of the sustainability webpages, which is routinely updated and includes a description of our enterprise risk management program and our policies on child labor, human trafficking, anti-harassment, antibribery, and cyber security all of which are evaluated by third-parties, including EcoVadis.

In addition, the investors pages of our website contain additional materials regarding our corporate governance process, including our Board committee charters, our corporate governance guidelines, our Code of Conduct, our Supplier Code of Conduct and other documents.

Our 2021 EcoVadis Assessment scored our Ethics response in the top 1% of companies EcoVadis rated in our sector category, the manufacture of basic chemicals, fertilizers and nitrogen compounds, plastics and synthetic rubber in primary forms.

Additional Sustainability Information:

Further information about our sustainability programs can be found on our web site at https://www.ecovyst.com/sustainability/.

The information available at our sustainability web site includes our inaugural sustainability report, our sustainability goals (and how such goals map to the UN Sustainable Development Goals), materiality matrix, letters of assurance, Global Reporting Initiative (GRI) Disclosure and Sustainability Accounting Standards Board (SASB) Index, our HSES Policy Statement, our Corporate Code of Conduct, our Human Rights Policy Statement, a description of our Ethics & Compliance Complaint and Review Process and our Labor Policy.

The further information contained on our web-site is not incorporated herein by reference and is not a part of this Annual Report on Form 10-K.

Environmental Regulations

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Soil and groundwater contamination requiring investigation and remediation has been discovered at some of the sites, and might occur or be discovered at other sites.

Several active and former facilities currently are undergoing investigation and remediation, including sites in Dominguez, CA;

Martinez, CA;

and Tacoma, WA.

Several active and former facilities currently are undergoing investigation and remediation, including sites in Dominguez, CA and Martinez, CA.

Environmental Programs .

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Each facility has developed and implemented specific critical occupational health, safety, environmental, security and loss control programs.

We also have implemented a Health, Safety and Environmental (“HSE”) organizational structure with executive committee level leadership and dedicated environmental experts.

We also have implemented a HSE organizational structure with executive committee level leadership and dedicated environmental experts.

We have Regional HSE Specialists and Managers who are embedded in the field and provide HSE expertise and support to operating sites.

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We remain alert for any regulatory changes which may impact our products and their end uses.

In the EU, we are actively working with other industry partners to challenge the recent draft proposal concerning potential listing of silica on Annex II of the regulation on cosmetic products (substances prohibited in cosmetic products).

Available Information

Our website address is www.pqcorp.com.

Our website address is www.ecovyst.com.

We make available free of charge through our website our Annual Report 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) or 15(d) of the Securities and Exchange Act of 1934, as amended (“Exchange Act”), as well as reports on Forms 3, 4 and 5 filed pursuant to Section 16 of the Exchange Act, as soon as reasonably practicable after such documents are electronically filed with, or furnished to, the Securities and Exchange Commission (“SEC”).

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The information on our website is not, and shall not be deemed to be, a part of this report or incorporated into any other filings we make with the SEC.

Our Corporate Governance Guidelines, Code of Business Conduct and the charters of the Audit Committee, Compensation Committee, Nominating and Corporate Governance Committee and Health, Safety and Environment Committee of our Board of Directors are also available on our website and are available in print to any shareholder upon request by writing to PQ Investor Relations, 300 Lindenwood Drive, Malvern, PA 19355.

Our Corporate Governance Guidelines, Code of Business Conduct and the charters of the Audit Committee, Compensation Committee, Nominating and Corporate Governance Committee and Health, Safety and Environment Committee of our Board of Directors are also available on our website and are available in print to any shareholder upon request by writing to Ecovyst Investor Relations, 300 Lindenwood Drive, Malvern, PA 19355.

In accordance with SEC rules, we intend to disclose any amendment (other than any technical, administrative or other non-substantive) to the Code of Business Conduct, or any waiver of any provision thereof with respect to any of our executive officers, on our website within four business days following such amendment or waiver.

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