What changed in this filing

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Item 1. Business

2023-02-28 compared with 2022-03-01 · 153 added, 132 removed, 286 unchanged (50% of the section changed)

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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.

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.

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Except where noted, any tables, percentages or metrics included within this filing exclude the results of our former Performance Materials business.

Additionally, our Board of Directors (the “Board”) declared a special cash dividend of $1.80 per share, payable on December 14, 2020 to shareholders of record as of the close of business on December 21, 2020.

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

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.

We used a portion of the net cash proceeds to repay the entire 2018 Term Loan Facility (as defined below) of $231.4 million and the 5.75% Senior Unsecured Notes (as defined below) of $295.0 million.

The 5.75% Senior Unsecured Notes were redeemed at a redemption price equal to the sum of 102.875% of the principal amount of the 5.75% Senior Unsecured Notes plus accrued and unpaid interest to, but excluding, August 2, 2021.

Additionally, our 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.

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

We believe that our products contribute to lower emissions and cleaner air, higher fuel efficiency and cleaner fuels, and help advance the global transition to clean energy.

Specifically, our products and solutions help companies in the production of renewable fuels and help to produce vehicles with improved fuel efficiency and cleaner emissions.

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

We believe we are a leader in each of our business segments, holding what we estimate to be a number one or number two supply share position for products that generated more than 90% of our 2021 sales.

We believe that our global footprint and efficient network of strategically located manufacturing facilities provide us with a strong competitive advantage in serving our customers both regionally as well as globally.

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

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.

The Zeolyst JV sales are included in both the Fuels & Emission Controls and Packaging & Engineered Plastics end uses.

In 2022, we served global customers across many end uses and as of December 31, 2022, operated out of ten strategically located manufacturing facilities.

(1) Percentage calculations include $132.6 million of sales attributable to the Zeolyst Joint Venture (“Zeolyst JV”), which represents 50% of its total sales for the year ended December 31, 2022.

The Zeolyst JV sales are included in both the Clean Fuels, Emission Control & Others and Polymers & Engineered Plastics end uses.

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) Based on the delivery destination for products sold in 2022.

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 intend to capitalize on our strong business foundation, sustainability driven innovation and customer partnerships to grow sales, maintain high margins, deploy capital efficiently and generate consistent 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.

Our industry is characterized by constant development of new products and the need to support customers with new product innovation and technical services.

This innovation is coupled with consistent product quality and a reliable source of supply, delivered in a safe and environmentally sustainable manner.

Products sold to our customers can be high value-add even when they represent a small portion of the overall end product costs, and success can be achieved by helping customers improve their product performance, value, and quality.

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In addition, many products in the specialty chemicals industry benefit from economics that favor incumbent producers because the capital cost to expand existing capacity is typically significantly less than the capital cost necessary to build a new plant.

The combination of attractive operating margins and generally predictable maintenance capital expenditure requirements can produce attractive cash flows.

The combination of attractive operating margins and generally predictable maintenance capital expenditure requirements provides the ability to produce attractive cash flows.

Our Product End Uses

The table below summarizes our key end use applications and products, as well as the significant growth drivers in those applications.

Sales and Zeolyst JV Total Sales (1)

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

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

• Refinery hydrocracking catalysts

• Remove nitrogen oxides from emissions • Emission control catalysts

• 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

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

• 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.

The Zeolyst JV sales are included in both the Fuels & Emission Controls and Packaging & Engineered Plastics key end uses.

Sales including Zeolyst JV

Total Sales (1)

Key End Uses 2022 2021 2020 Significant Growth Drivers Key Products

Clean Fuels, Emission Control & Other 14% 19% 18% • Global regulatory requirements to:

• Refining hydrocracking catalysts

• Remove sulfur from diesel and gasoline • Emission control catalysts

• Remove nitrogen oxides from tailpipe emissions • Catalysts used in the production of renewable fuels

• Growing demand for renewable fuels • Catalyst activation

• Growing demand for ex-situ catalyst activation to support traditional and renewable fuels production • Aluminum sulfate solution

• Improve lubricant characteristics to improve fuel efficiencies • Ammonium bisulfite solution

• Municipal and industrial water treatment

Polymers & Engineered Plastics 15% 17% 19% • Demand for high-density polyethylene used for strengthening and light weighting components • Catalysts for high-density polyethylene and chemicals syntheses

• Demand for increased process efficiency and reduction of by-products in production chemicals • Antiblocks for film packaging

• Growing demand for recycling of materials • Niche custom catalyst

Regeneration and Treatment Services 36% 35% 38% • Increase gasoline octane in order to improve fuel efficiency while lowering vapor pressure and sulfur to regulated levels • Sulfuric acid regeneration services

• High industry utilization • Treatment services

• Growing demand for applications in hazardous and non-hazardous waste

Industrial, Mining & Automotive 35% 29% 25% • Demand for metals and minerals for low carbon technologies and infrastructure • Sulfuric acid for mining

• Demand for a wide range of products including construction materials, auto, consumer goods, and chemicals • Sulfur derivatives for industrial production

• Recovery in global oil drilling/U.S.

copper production • Sulfur derivatives for nylon production

(1) Percentage calculations include $132.6 million, $131.3 million and $128.6 million of sales attributable to the Zeolyst JV, which represents 50% of its total sales for each of the years ended December 31, 2022, 2021 and 2020, respectively.

The Zeolyst JV sales are included in both the Clean Fuels, Emission Control & Other and Polymers & Engineered Plastics key end uses.

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Favorable Secular Growth Trends Across the Portfolio

We focus on serving end use applications where we believe significant future growth potential exists.

Our products address our customers’ needs, which are typically driven either by regulatory requirements or consumer preferences, on a global basis.

In 2021, a majority of our sales were to end uses such as fuels and emission controls, consumer products and industrial applications that generally do not exhibit as much cyclicality as other applications.

We believe that our products incorporate innovative environmental and safety solutions to address evolving customer demands, examples of which include the following:

We focus on serving end use applications where we believe significant growth potential exists.

Our products and services address our customers’ needs, which are typically driven either by regulatory requirements or consumer preferences, on a global basis.

We believe that our products and services incorporate innovative environmental and safety solutions to address evolving customer demands, examples of which include the following:

• 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 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.

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

We believe these trends present global opportunities for the Zeolyst Joint Venture to support our customers in meeting these standards through our sales of emission control catalysts.

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 Ecoservices segment is well positioned to benefit from any related growth in demand for alkylate.

We believe that stringent fuel efficiency standards that spur the use of high compression engines requiring higher-octane gasoline and continued stringent regulatory requirements for gasoline will continue to encourage strong alklyate production at our refining customers.

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 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.

Our Ecoservices segment is the largest North American recycler of sulfuric acid 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.

Similarly, we believe 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.

Leading Supply Positions

We believe that we maintain a leading supply position for certain products sold within each of our segments, holding what we estimate to be the number one or two supply share position in 2021 for products that generated more than 90% of our sales.

We believe that we maintain a leading supply position for certain products sold within each of our segments, holding what we estimate to be the number one or two supply share position in 2022 for products that generated more than 90% of our sales and our proportionate 50% share of sales attributable to the Zeolyst JV, respectively.

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 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.

We are a leading supplier of zeolite-based catalyst used to remove sulfur in the refinery hydrocracking process, 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 other niche custom catalyst applications, including supplying catalyst used to produce methyl methacrylate (“MMA”).

In our Ecoservices segment, we hold an estimated number one supply share position in the United States in sulfuric acid regeneration services based on 2022 sales volume of greater than 50%.

Innovation Track Record

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

We believe 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.

We also manufacture zeolite-based catalysts used in the production of renewable fuels to help advance the global transition to clean energy.

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 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.

Our customers include large industrial companies such as Exxon Mobil, BASF and Chevron Products, and global catalyst producers such as Albemarle and Grace.

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

We have long-term relationships with our top ten customers, based on 2022 sales, that average more than 50 years.

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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.

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 mechanisms in our sales contracts and other adjustment provisions.

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.

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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 caustic soda, which prices have historically been less volatile than oil.

Our products are predominantly inorganic and carbon-free, and are produced from readily available raw materials.

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.

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

We partner with many of our customers under long-term contract agreements, 100% requirement arrangements and/or specified products for certain license production processes.

In our Ecoservices segment, approximately 40% of our production capacity serves customers with staggered multi-year commitment 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 30% of our sulfuric acid volume for the year ended December 31, 2022 was under contracts expiring at the end of 2023 or beyond.

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.

In our zeolite catalysts product group, we operate with a mix of evergreen and various term contracts depending on the product customization with value pricing ranging from 1 to 3 years to supply catalysts and zeolite powders for the refining, petrochemical and chemical industries and nitrogen oxides control catalysts for diesel transportation industries.

Further, we have a multi-year supply agreement for MMA catalyst with a leading global producer.

In our zeolite catalysts product group, where we supply catalysts and zeolite powders for refining, renewable fuels, and emission controls applications, we operate with a mix of evergreen and various term contracts depending on the product customization.

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

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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.

Ecoservices has also applied its expert knowledge in thermal decomposition 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.

Our R&D centers seek to 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

We have demonstrated the ability to maintain stable margins while continuing to grow in different macroeconomic environments given secular trends supporting many of our business segments.

The secular trends supporting many of our business segments has allowed us to maintain stable margins while continuing to grow in different macroeconomic environments.

We believe that the stability of our margins and cash flows is also aided by long term sales contracts and material cost pass-through.

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We believe that our value-added products and services have proven to be critical to the performance of our customers’ products, and typically represent only a small portion of our customers’ overall end-product costs.

Our cash flow generation has been driven, in part, by our disciplined capital investment as well as tax attributes that provide us with cash flow benefits.

As of December 31, 2021, we had $271.6 million of tax deductible intangibles and goodwill with respect to Eco Services Operations LLC of which provides us with cash tax savings as we generate taxable income.

We believe our strong commercial contact structure enables our businesses to generate strong operating cash flow.

In addition, our cash flow generation has been driven, in part, by lower debt levels, our disciplined capital investment, as well as tax attributes that provide us with cash flow benefits.

As of December 31, 2022, we had $293.1 million of tax deductible intangibles and goodwill with respect to Eco Services Operations LLC, which provides us with cash tax savings as we generate taxable income.

Our Business Segments

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% of Total Sales and Zeolyst Joint Venture Sales (1)(2)

Net Income Adjusted EBITDA (1)

Net Income % of Net Income Adjusted EBITDA (1)

% of Total Adjusted EBITDA (1)(2)

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Total $ 820.2 100.0 % $ 132.6 100.0 % $ 73.7 100.0 % $ 276.8 100.0 %

(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.

(1) Percentage calculations include $132.6 million of sales attributable to the Zeolyst JV, which represents 50% of its total sales for the year ended December 31, 2022.

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—Key Performance Indicators” for discussion of our use of non-GAAP financial measures and reconciliations.

(2) Percentage calculations exclude $29.0 million in corporate expenses.

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.

By providing regeneration services, as well as purchasing by-product sulfur from customers as a source of energy and for use in manufacturing virgin sulfuric acid, we believe that we provide our refining customers with a complete solution for their sulfuric acid needs.

Our Ecoservices segment is a leading provider of sulfuric acid recycling (“Regeneration Services”) and end-to-end logistics to North American refineries to support 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 (“Virgin Sulfuric Acid”).

We provide treatment services for hazardous/non-hazardous industrial wastes (“Treatment Services”) and with the acquisition of Chem 32, LLC (“Chem32”) in March 2021, and we are also a leader in ex situ sulfiding and pre-activation for hydro-processing catalysts, which are used in production of traditional and renewable fuels.

By providing regeneration services, as well as purchasing by-product sulfur from customers for use in manufacturing virgin sulfuric acid, we believe that we provide our refining customers with a complete solution for their sulfuric acid needs.

Trends for increased alkylate production are being driven by:

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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.

We believe that 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.

Alternatively, product can be shipped by barge, rail and truck.

Our primary product groups include Regeneration Services and Virgin Sulfuric Acid.

Primary Product Groups

Regeneration Services serves a critical need for refining customers.

Sulfuric acid serves as a catalyst in the alkylation process.

The resulting spent sulfuric acid needs to be regenerated, which is no longer a core competency of most refiners.

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 high strength fresh acid for reuse in the alkylation process.

The resulting spent sulfuric acid needs to be regenerated or recycled, which is no longer a core competency of most refiners.

Since storage space for fresh and spent sulfuric 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 regeneration services.

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 sulfuric acid into high strength fresh sulfuric 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.

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

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

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

Our Treatment Services business is a niche offering providing a thermal destruction solution for the management of bulk quantities of hazardous and non-hazardous by-products, co-products and waste materials.

We specialize in handling sulfur-bearing materials, acidic materials, high-temperature molten materials and other hard to handle liquids.

Our process provides a beneficial reuse alternative to traditional disposal by capturing the energy value and sulfur content of these materials, supplementing our processes, and offsetting the use of virgin raw materials.

Given our strategic presence on the Gulf Coast and in California, and our relationships with leading refineries, we estimate that our regenerated sulfuric acid supply share is substantially larger than our closest competitor.

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Our finished silica-based catalysts and catalyst supports are necessary to produce high strength and high stiffness plastics used in packaging films, bottles, containers, and other molded applications.

Global consumer demand for high strength lightweight plastics is expected to continue in the near to medium term driving increased production capacity expansions.

Our zeolite-based emission control catalysts enable the removal of nitrogen oxides from diesel engine emissions as well as sulfur dioxide from fuels during the refining process.

The continued expansion of stricter global regulations for reducing sulfur in all fuel pools is expected to drive the ongoing demand for our products.

Global consumer demand for high strength lightweight plastics is expected to continue to grow in the near to medium term driving increased production capacity expansions.

Our zeolite-based catalysts enable the removal of nitrogen oxides from diesel engine emissions as well as sulfur dioxide from fuels during the refining process.

The continued expansion of stricter global regulations for reducing sulfur in fuels is expected to drive the ongoing demand for our products.

Our product groups include Silica Catalysts and Zeolite Catalysts.

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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 polyethylene and polyester films from adhering to one another during manufacturing and in use.

In addition, we supply 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.

or “Shell”), supplies critical high technology specialty zeolite and zeolite-based catalysts to customers in three end uses:

refining (primarily hydrocracking catalyst and dewaxing), petrochemicals, and emission control systems for both on-road and non-road diesel engines.

or “Shell”), supplies high technology specialty zeolites and zeolite-based catalysts to customers for the following major end uses:

refining (primarily hydrocracking catalyst and dewaxing), petrochemicals, renewable fuels, and emission control systems for both on-road and non-road diesel engines.

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

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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.

To meet sulfur emission control standards, hydrocracking catalyst is the most economic method for refiners while maintaining yields for one of the most profitable product streams.

The Zeolyst Joint Venture is the sole supplier of hydrocracking catalyst to Shell, but a majority of sales are to third-party refineries.

To meet sulfur emission control standards, hydrocracking catalyst is the most economic method for refiners while maintaining yields for diesel, one of the most profitable product streams.

The Zeolyst Joint Venture is the sole supplier of hydrocracking catalyst to Shell, but a majority of catalyst sales are to third-party refineries.

We also provide precursor supports to many of the hydrocracking catalyst suppliers, positioning us as a leading supplier in the global hydrocracking catalyst supply chain.

To meet nitrogen oxides (“NOx”) emission control regulations that are expanding globally, many of our zeolite powders are used in an advanced emission control technology called selective catalytic reduction, largely focused on heavy duty diesel (“HDD”) transportation.

This process uses ammonia to react with engine exhaust gases via our catalysts in order to convert NOx, a pollutant, into nitrogen and water.

This process uses ammonia to react with engine exhaust gases via our catalysts in order to convert NOx, a pollutant, into harmless nitrogen and water.

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 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.

Our Silica Catalysts product group primarily competes with Grace.

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

Some direct competition with niche companies exists, including competitors such as Tosoh and Clariant.

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Raw Materials

Our products are predominantly inorganic and carbon-free, and are produced from readily available raw materials such as sodium silicate and sodium hydroxide (“caustic soda”), which prices have historically been less volatile than oil.

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

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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 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.

Where possible, we also utilize 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”.

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”.

Zeolyst Joint Venture

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

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.

We produce specialty zeolites that are precursors for the production of hydrocracking catalyst and other refinery and renewable fuels catalysts.

Our extensive expertise in zeolite production enables us to manage the production of specialty zeolites.

Specialty zeolite 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.

Research and Development

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

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

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

We operate two research and development facilities:

one in the United States and one in 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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This business group and customer-oriented team structure provides strong links between our product development and manufacturing functions and our customer collaboration and specifications.

These connections enable us to focus our development on timely and relevant products for our customers while remaining attentive to manufacturing considerations to enable us to produce new products profitably and in a timely manner.

These connections enable us to focus our development on timely and relevant products for our customers while remaining attentive to manufacturing considerations that enable us to produce new products profitably and in a timely manner.

Product development activities are organized into research and development projects that are subject to regular reviews by the business teams in order to understand and address our customers’ evolving needs and invest in our growth by prioritizing innovation driven by these identified needs.

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Intellectual Property

We evaluate on a case-by-case basis how best to use patents, trademarks, copyrights, trade secrets and other available intellectual property protections in order to protect our products and our critical investments in research and development, manufacturing and marketing.

We focus on securing and maintaining patents for certain inventions such as composition-of-matter, while maintaining other inventions such as process improvements as trade secrets, derived from our market-based business model, in an effort to maximize the value of our product portfolio and manufacturing capabilities and reinforce our competitive advantage.

We evaluate how best to use patents, trademarks, copyrights, trade secrets and other available intellectual property protections on a case by case base.

This is done to protect our products and our critical investments in research and development, manufacturing and marketing.

We focus on securing and maintaining patents for certain inventions such as composition-of-matter, while maintaining other inventions such as process improvements as trade secrets to maximize the value of our product portfolio and reinforce our competitive advantage.

Our policy is to seek appropriate intellectual property protection for significant product and process developments in the major areas where the relevant products are manufactured or sold.

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We own or have rights to a number of patents relating to our products and processes.

As of December 31, 2021, we owned 20 patented inventions in the United States, with approximately 166 patents issued in countries around the world and approximately 41 patent applications pending worldwide covering more than 4 additional inventions.

As of December 31, 2021, we also had trademark rights in approximately 21 trademark registrations worldwide, including approximately 3 U.S.

As of December 31, 2022, we owned 20 patented inventions in the United States, with 197 patents issued in countries around the world and 40 patent applications pending worldwide.

As of December 31, 2022, we also had trademark rights in 50 trademark registrations worldwide, including 5 U.S.

trademark registrations.

We also have approximately 20 pending trademark applications, which include applications in the United States and worldwide.

We also have 16 pending trademark applications, which include applications in the United States and worldwide.

In addition to our registered and applied-for intellectual property portfolio, we also claim ownership of certain trade secrets and proprietary know-how developed by and used in our business.

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

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

We strive to create sustainable products that are safe for the environment, and to 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.

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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;

For example, we:

• Were awarded a Gold Sustainability Score from EcoVadis for 2023, a third-party sustainability evaluation company.

The Gold Medal rating score from EcoVadis places us in the 97th percentile of all companies ranked by EcoVadis in our sector peer group;

• Maintained an executive level position of Vice President – Environment and Sustainability that reports directly to our CEO;

• Created the position of Global Director of Health, Safety and Process Safety Management to oversee the company’s goal-setting and improvement efforts in the areas of health, safety and process safety;

• Provided enhanced sustainability information on our website and published our 2021 Sustainability Report, our first as Ecovyst, in June 2022;

• Continued work towards our previously announced 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;

• Continued steps to 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.

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

• Achieved a 90% performance in our flagship HSE Perfect Days program, which targets at-risk behaviors and celebrates positive HSE performance across the organization on a daily basis.

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

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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 Ecoservices segment, we provide sulfuric acid regeneration services that avoid significant landfill or deep well disposal.

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 maintain policies and procedures to monitor and control health, safety, and environmental risks, and to enable 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.

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

We also have a strong HSE 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 and safety experts on staff.

We have a Global Director of Health, Safety and Process Safety Management and also 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.

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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 included the assured 2020 data on our website and in our 2021 Sustainability Report, which we published in June 2022.

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

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.

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 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.

We are committed to providing equal employment opportunities for all employees and applicants for employment, and do 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.

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Our global succession planning process is designed to provide sufficient talented personnel to fill key leadership, innovation and manufacturing roles well into the future and to better prepare employees for their future at the Company.

In order to enable a pipeline for our leadership, we maintain a robust Emerging Leaders program to identify top talent to build leadership capabilities and provide the fundamental skills we believe every leader needs to generate passion and productivity in their team.

In order to enable a pipeline for our leadership, we maintain a robust Emerging Leaders program to identify and nurture top talent to build leadership capabilities and provide the fundamental skills we believe every leader needs to generate passion and productivity in their team.

The program also provides an important networking opportunity that creates a connected community of leaders at the Company.

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As of December 31, 2022, we had 890 employees worldwide, of which 754 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.

Further, as of December 31, 2022, approximately 23% of our U.S.-based executives, managers and professionals were females and 21% were non-white males.

Our rate of hiring veterans increased from 7% in 2021 to 11% in 2022, which is double the federal government’s national veterans hiring benchmark for 2022.

As of December 31, 2022, approximately 45% of our employees were represented by a union, works council or other employee representative body.

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This constructive work environment has been re-enforced with the recent implementation of a fully integrated on-line performance management process that improves the communication of aligned goals, encourages consistent feedback and furthers employee engagement.

Today, there are women on the management teams of each of our businesses as well as in all our functions:

Today, there are women on the leadership teams of each of our businesses as well as in all our functions:

R&D, Finance, HSE and Human Resources.

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.

In 2022, our sites continued to work to have a positive impact in the communities in which we operate.

For example, for the holidays (a) our office in The Woodlands, Texas donated blankets, popcorn, and Christmas candy to the Montgomery County Community Center;

(b) our Houston, Texas plant personnel provided gifts to five neighborhood families during the holiday season and also held a dinner for community members at their Community Advisory Panel meeting;

(d) our Baytown, Texas plant supported two local families with household supplies, food, and Christmas gifts and also had 11 employees volunteer at the Houston Food to prepare Backpack Buddy meals;

(e) employees at our Baton Rouge facility adopted 20 Angels through the Salvation Army for the holiday season;

(f) our Martinez, California facility held a holiday dinner for the Community Advisory Panel;

(g) our Dominguez, California plant personnel donated $1,000 to a local Rotary Club to subsidize food items for local families;

and (h) our Malvern, Pennsylvania office personnel participated in the “Adopt a Child” program sponsored by a local church to provide holiday gifts for children whose families would not otherwise be able to afford gifts .

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.

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 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.

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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/.

Further information about our sustainability programs can be found on our website 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.

The further information contained on our website 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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We have a strong health, safety, environmental organization.

We have a staff of professionals who are responsible for environmental, safety, health and product regulatory compliance.

We maintain a staff of professionals who are responsible for environmental, safety, health and product regulatory compliance.

We have implemented a corporate audit program for all of our facilities.

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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.

We have a Global Director of Health, Safety and Process Safety Management as well as 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.

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Since the promulgation of REACH, other countries have enacted or are in the process of implementing similar comprehensive chemical regulations.

These programs include the Korea REACH law, which is requiring registration and

potential testing of chemicals, and similar programs under development in the UK, Taiwan, Turkey, India, and elsewhere.

These programs include the Korea REACH law, which is requiring registration and potential testing of chemicals, and similar programs under development in the UK, Taiwan, Turkey, India, and elsewhere.

In the US, all pertinent chemicals have been designated as “active” under the US EPA Frank R.

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

What changed 10-K

Item 1. Business