GRIFFON CORP 10-K

Item 8. Financial Statements and Supplementary Data The financial statements of Griffon and its subsidiaries and the report thereon of Grant Thornton LLP (PCAOB ID 248 ) are included herein: ▪ Report of Independent Registered Public Accounting Firm. ▪ Consolidated Balance Sheets at September 30, 2025 and 2024. ▪ Consolidated Statements of Operations and Comprehensive Income (Loss) for the years ended September 30, 2025, 2024 and 2023. ▪ Consolidated Statements of Cash Flows for the years ended September 30, 2025, 2024 and 2023. ▪ Consolidated Statements of Shareholders’ Equity for the years ended September 30, 2025, 2024 and 2023. ▪ Notes to Consolidated Financial Statements. ▪ Schedule II – Valuation and Qualifying Accounts. 45 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Board of Directors and Shareholders Griffon Corporation Opinions on the financial statements and internal control over financial reporting We have audited the accompanying consolidated balance sheets of Griffon Corporation (a Delaware corporation) and subsidiaries (the “Company”) as of September 30, 2025 and 2024, and the related consolidated statements of operations and comprehensive income (loss), shareholders’ equity, and cash flows for each of the three years in the period ended September 30, 2025, and the related notes and financial statement schedule included under Item 15(a)(2) (collectively referred to as the “consolidated financial statements”). We also have audited the Company’s internal control over financial reporting as of September 30, 2025, based on criteria established in the 2013 Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of September 30, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended September 30, 2025 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of September 30, 2025, based on criteria established in the 2013 Internal Control—Integrated Framework issued by COSO. Basis for opinions The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s consolidated financial statements and an opinion on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions. Definition and limitations of internal control over financial reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. 46 Critical audit matter The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Hunter Fan Indefinite-Lived Intangible Asset Impairment Assessment As described further in notes 1 and 7 to the consolidated financial statements, the Company tests indefinite-lived intangible assets for impairment at least annually in the fourth quarter, and more frequently whenever events or circumstances change that would more likely than not reduce the fair value below the carrying amount. Due to a decrease in year-to-date and forecasted sales and operating results at Hunter Fan, primarily attributable to ongoing weak consumer demand coupled with the impact of tariffs on customer order patterns, the Company determined that indicators of impairment were present at June 30, 2025 and therefore completed an interim impairment test for the Hunter Fan trademark. Hunter Fan ’ s trademark was tested for impairment by comparing the estimated fair value of the asset to its carrying value. The estimated fair value was determined using a relief from royalty valuation method, which estimates the value of a trademark by discounting to present value the hypothetical royalty payments that are saved by owning the asset rather than licensing it. As a result of the interim impairment test, the Company recorded an impairment charge of $107.0 million on Hunter Fan ’ s trademark as of June 30, 2025. We identified the Company ’ s interim impairment testing of the Hunter Fan trademark as a critical audit matter. The principal considerations for our determination that the Hunter Fan trademark interim impairment testing is a critical audit matter are as follows: The determination of the fair value of indefinite-lived intangible assets requires management to make significant estimates and assumptions related to forecasts of future cash flows, such as revenue growth rates, the discount rate, inclusive of weighted average cost of capital, and the royalty rate. This requires management to evaluate historical results and expectations of future operating performance based on relevant information available to them regarding expectations of industry performance, as well as expectations for entity-specific performance. In addition, determining the discount rate requires management to evaluate the appropriate risk premium based on their judgment of industry and entity-specific risks. Similarly, determining the royalty rate requires management to evaluate hypothetical royalty payments that are saved by owning the asset rather than licensing it. As disclosed by management, changes in these assumptions could result in a significantly different estimate of the fair value of the indefinite-lived intangible asset. In turn, auditing these judgments and assumptions requires a high degree of auditor judgment. Our audit procedures related to the Hunter Fan trademark quantitative impairment testing included the following: We tested the design and operating effectiveness of controls relating to the impairment testing, including the Company’s ability to develop the assumptions utilized in determining the fair value of the indefinite-lived intangible asset. Such assumptions included revenue growth rates, the discount rate, inclusive of weighted average cost of capital, and the royalty rate. With the assistance of valuation specialists, we evaluated the appropriateness of the valuation method utilized and assessed the appropriateness of assumptions utilized. We also evaluated the qualifications of the valuation specialists engaged by management responsible for preparing the estimated fair value of the Hunter Fan trademark. We evaluated the method used and tested significant inputs and significant assumptions utilized in performing the interim impairment test, as follows: a) tested forecasted revenue attributable to the trademark by comparing to historical trends and industry expectations, performed a sensitivity analysis over revenue growth rates and assessed management’s historical ability to accurately forecast; b) tested the discount rate by comparing to historical rates and industry expectations, compared the rate to market comparable companies, independently calculated the discount rate for comparison to those used by management and performed a sensitivity analysis over the discount rate; and c) tested the assumed royalty rate by comparing to comparable licensing agreements, and performed a sensitivity analysis over the royalty rate. /s/ GRANT THORNTON LLP We have served as the Company’s auditor since 2006. New York, New York November 19, 2025 47 GRIFFON CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands, except per share data) At September 30, 2025 At September 30, 2024 CURRENT ASSETS Cash and equivalents $ 99,045 $ 114,438 Accounts receivable, net of allowances of $ 10,086 and $ 10,986 290,807 312,765 Inventories 440,772 425,489 Prepaid and other current assets 53,059 61,604 Assets held for sale 5,609 14,532 Assets of discontinued operations 1,302 648 Total Current Assets 890,594 929,476 PROPERTY, PLANT AND EQUIPMENT, net 293,528 288,297 OPERATING LEASE RIGHT-OF-USE ASSETS 167,829 171,211 GOODWILL 192,917 329,393 INTANGIBLE ASSETS, net 488,114 618,782 OTHER ASSETS 25,956 30,378 ASSETS OF DISCONTINUED OPERATIONS 4,699 3,417 Total Assets $ 2,063,637 $ 2,370,954 CURRENT LIABILITIES Notes payable and current portion of long-term debt $ 8,103 $ 8,155 Accounts payable 137,484 119,354 Accrued liabilities 152,707 181,918 Current portion of operating lease liabilities 32,307 35,065 Liabilities of discontinued operations 3,956 4,498 Total Current Liabilities 334,557 348,990 LONG-TERM DEBT, net 1,404,387 1,515,897 LONG-TERM OPERATING LEASE LIABILITIES 147,203 147,369 OTHER LIABILITIES 98,748 130,540 LIABILITIES OF DISCONTINUED OPERATIONS 4,770 3,270 Total Liabilities 1,989,665 2,146,066 COMMITMENTS AND CONTINGENCIES - See Note 16 SHAREHOLDERS’ EQUITY Preferred stock, par value $ 0.25 per share, authorized 3,000 shares, no shares issued — — Common stock, par value $ 0.25 per share, authorized 85,000 shares, issued shares of 84,746 in both 2025 and 2024 21,187 21,187 Capital in excess of par value 690,153 677,028 Retained earnings 479,048 461,442 Treasury shares, at cost, 38,400 common shares and 36,443 common shares as of September 30, 2025 and 2024, respectively ( 1,044,496 ) ( 876,527 ) Accumulated other comprehensive loss ( 71,920 ) ( 58,024 ) Deferred compensation — ( 218 ) Total Shareholders’ Equity 73,972 224,888 Total Liabilities and Shareholders’ Equity $ 2,063,637 $ 2,370,954 The accompanying notes to consolidated financial statements are an integral part of these statements. 48 GRIFFON CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (in thousands, except per share data) Years Ended September 30, 2025 2024 2023 Revenue $ 2,519,926 $ 2,623,520 $ 2,685,183 Cost of goods and services 1,461,921 1,603,585 1,736,362 Gross profit 1,058,005 1,019,935 948,821 Selling, general and administrative expenses 608,116 621,638 642,734 Goodwill and intangible asset impairments 243,612 — 109,200 Total operating expenses 851,728 621,638 751,934 Income from operations 206,277 398,297 196,887 Other income (expense) Interest expense ( 96,012 ) ( 104,086 ) ( 101,445 ) Interest income 2,155 2,434 2,094 Gain (loss) on sale of real estate 8,279 ( 61 ) 12,655 Debt extinguishment, net — ( 1,700 ) ( 437 ) Other, net 6,672 1,766 2,928 Total other income (expense) ( 78,906 ) ( 101,647 ) ( 84,205 ) Income before taxes 127,371 296,650 112,682 Provision for income taxes 76,261 86,753 35,065 Net income $ 51,110 $ 209,897 $ 77,617 Basic earnings per common share $ 1.13 $ 4.41 $ 1.49 Weighted-average shares outstanding - basic 45,354 47,573 52,111 Diluted earnings per common share $ 1.09 $ 4.23 $ 1.42 Weighted-average shares outstanding - diluted 46,685 49,668 54,612 Net income $ 51,110 $ 209,897 $ 77,617 Other comprehensive income (loss), net of taxes: Foreign currency translation adjustments ( 6,569 ) 10,137 8,447 Pension and other post retirement plans ( 8,361 ) 1,538 6,634 Gain (loss) on cash flow hedge 1,034 311 ( 2,353 ) Total other comprehensive income (loss), net of taxes ( 13,896 ) 11,986 12,728 Comprehensive income $ 37,214 $ 221,883 $ 90,345 The accompanying notes to consolidated financial statements are an integral part of these statements. 49 GRIFFON CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) Years Ended September 30, 2025 2024 2023 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 51,110 $ 209,897 $ 77,617 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 63,014 60,704 65,445 Fair value write-up of acquired inventory sold — 491 — Stock-based compensation 25,483 26,838 41,112 Goodwill and intangible asset impairments 243,612 — 109,200 Asset impairment charges - restructuring — 23,763 58,932 Provision for losses on accounts receivable 566 636 971 Amortization of deferred financing costs and debt discounts 4,176 4,202 4,232 Debt extinguishment, net — 1,700 437 Deferred income tax provision (benefit) ( 28,485 ) 3,574 ( 37,795 ) Gain on sale of real estate ( 8,279 ) ( 61 ) ( 12,655 ) Change in assets and liabilities, net of assets and liabilities acquired: Decrease in accounts receivable 18,850 4,243 51,119 (Increase) decrease in inventories ( 18,307 ) 73,582 129,209 (Increase) decrease in prepaid and other assets ( 14,166 ) ( 925 ) 621 Increase (decrease) in accounts payable, accrued liabilities, income taxes payable and operating lease liabilities 17,870 ( 30,732 ) ( 67,843 ) Other changes, net 1,996 2,130 11,163 Net cash provided by operating activities 357,440 380,042 431,765 CASH FLOWS FROM INVESTING ACTIVITIES: Acquisition of property, plant and equipment ( 52,435 ) ( 68,399 ) ( 63,604 ) Acquired business, net of cash acquired — ( 14,579 ) — Proceeds (payments) from sale of business, net — 3,500 ( 2,568 ) Proceeds from sale of property, plant and equipment 18,006 14,479 20,961 Net cash used in investing activities ( 34,429 ) ( 64,999 ) ( 45,211 ) CASH FLOWS FROM FINANCING ACTIVITIES: Dividends paid ( 39,692 ) ( 35,806 ) ( 133,814 ) Purchase of shares for treasury ( 183,271 ) ( 309,916 ) ( 163,970 ) Proceeds from long-term debt 63,000 217,000 122,558 Payments of long-term debt ( 178,654 ) ( 168,778 ) ( 221,781 ) Financing costs — ( 907 ) ( 3,025 ) Other, net ( 130 ) ( 341 ) ( 130 ) Net cash used in financing activities ( 338,747 ) ( 298,748 ) ( 400,162 ) 50 GRIFFON CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) CASH FLOWS FROM DISCONTINUED OPERATIONS: Net cash used in operating activities ( 1,422 ) ( 2,776 ) ( 2,994 ) Net cash provided by investing activities 137 — — Net cash used in discontinued operations ( 1,285 ) ( 2,776 ) ( 2,994 ) Effect of exchange rate changes on cash and equivalents 1,628 ( 1,970 ) ( 693 ) NET INCREASE (DECREASE) IN CASH AND EQUIVALENTS ( 15,393 ) 11,549 ( 17,295 ) CASH AND EQUIVALENTS AT BEGINNING OF PERIOD 114,438 102,889 120,184 CASH AND EQUIVALENTS AT END OF PERIOD $ 99,045 $ 114,438 $ 102,889 Supplemental Disclosure of Cash Flow Information: Cash paid for interest $ 92,887 $ 100,676 $ 99,833 Cash paid for taxes $ 96,244 $ 102,978 $ 70,937 Capital expenditures in accounts payable $ 1,029 $ 5,341 $ 3,945 The accompanying notes to consolidated financial statements are an integral part of these statements. 51 GRIFFON CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (in thousands) COMMON STOCK CAPITAL IN EXCESS OF PAR VALUE RETAINED EARNINGS TREASURY SHARES ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) DEFERRED COMPENSATION Total SHARES PAR VALUE SHARES COST Balance at 9/30/2022 84,746 $ 21,187 $ 627,982 $ 344,060 27,682 $ ( 420,116 ) $ ( 82,738 ) $ ( 12,805 ) $ 477,570 Net income — — — 77,617 — — — — 77,617 Dividends — — — ( 140,161 ) — — — — ( 140,161 ) Shares withheld on employee taxes on vested equity awards — — — — 366 ( 12,990 ) — — ( 12,990 ) Amortization of deferred compensation — — — — — — — 10,362 10,362 Common stock acquired — — — — 4,143 ( 152,279 ) — — ( 152,279 ) Equity awards granted, net — — ( 7,699 ) — ( 507 ) 7,699 — — — ESOP allocation of common stock — — 21,868 — — — — — 21,868 Stock-based compensation — — 20,529 — — — — — 20,529 Other comprehensive income, net of tax — — — — — — 12,728 — 12,728 Balance at 9/30/2023 84,746 $ 21,187 $ 662,680 $ 281,516 31,684 $ ( 577,686 ) $ ( 70,010 ) $ ( 2,443 ) $ 315,244 Net income — — — 209,897 — — — — 209,897 Dividends — — — ( 29,971 ) — — — — ( 29,971 ) Shares withheld on employee taxes on vested equity awards — — — — 595 ( 34,330 ) — — ( 34,330 ) Amortization of deferred compensation — — — — — — — 2,225 2,225 Common stock acquired including excise taxes — — — — 4,772 ( 277,896 ) — — ( 277,896 ) Equity awards granted, net — — ( 12,875 ) — ( 608 ) 12,875 — — — ESOP allocation of common stock including excise taxes — — 8,918 — — 510 — — 9,428 Stock-based compensation — — 18,305 — — — — — 18,305 Other comprehensive income, net of tax — — — — — — 11,986 — 11,986 Balance at 9/30/2024 84,746 $ 21,187 $ 677,028 $ 461,442 36,443 $ ( 876,527 ) $ ( 58,024 ) $ ( 218 ) $ 224,888 Net income — — — 51,110 — — — — 51,110 Dividends — — — ( 33,504 ) — — — — ( 33,504 ) Shares withheld on employee taxes on vested equity awards including excise taxes — — — — 584 ( 44,756 ) — — ( 44,756 ) Amortization of deferred compensation — — — — — — — 218 218 Common stock acquired including excise taxes — — — — 1,897 ( 136,215 ) — — ( 136,215 ) Equity awards granted, net — — ( 12,895 ) — ( 524 ) 12,895 — — — ESOP allocation of common stock including excise taxes — — 537 — — 107 — — 644 Stock-based compensation — — 25,483 — — — — — 25,483 Other comprehensive income, net of tax — — — — — — ( 13,896 ) — ( 13,896 ) Balance at 9/30/2025 84,746 $ 21,187 $ 690,153 $ 479,048 38,400 $ ( 1,044,496 ) $ ( 71,920 ) $ — $ 73,972 The accompanying notes to consolidated financial statements are an integral part of these statements. 52 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (US dollars and non US currencies in thousands, except per share data) (Unless otherwise indicated, all references to years or year-end refer to Griffon’s fiscal period ending September 30, NOTE 1 — DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of business Griffon Corporation (the “Company,” “Griffon,” "we" or "us") is a diversified management and holding company that conducts business through wholly-owned subsidiaries. Griffon oversees the operations of its subsidiaries, allocates resources among them and manages their capital structures. Griffon provides direction and assistance to its subsidiaries with acquisition and growth opportunities as well as divestitures. As long-term investors, we intend to continue to grow and strengthen our existing businesses, and to diversify further through investments in our businesses and acquisitions. The Company was founded in 1959, is a Delaware corporation headquartered in New York, N.Y. and is listed on the New York Stock Exchange (NYSE:GFF). On July 1, 2024, Griffon announced that its subsidiary, The AMES Companies, Inc., ("AMES") expanded the scope of its Australian operations by acquiring substantially all the assets of Pope, a leading Australian provider of residential watering products, from The Toro Company (NYSE:TTC) for a purchase price of approximately AUD 21,800 (approximately $ 14,500 ) in cash. This is CPP's seventh acquisition in Australia since 2013, and further expands AMES's product portfolio in the Australian market. Griffon announced in May 2023 that CPP was expanding its global sourcing strategy to include long handled tools, material handling, and wood storage and organization product lines for the U.S. market. This initiative was successfully completed as of September 30, 2024. Refer to Note 10 - Restructuring Charges for additional information. Griffon currently conducts its operations through two reportable segments: • Home and Building Products ("HBP") conducts its operations through Clopay Corporation ("Clopay"). Founded in 1964, Clopay is the largest manufacturer and marketer of garage doors and rolling steel doors in North America. Residential and commercial sectional garage doors are sold through professional dealers and leading home center retail chains throughout North America under the brands Clopay, Ideal, and Holmes. Rolling steel door and grille products designed for commercial, industrial, institutional, and retail use are sold under the Clopay, Cornell and Cookson brands. • Consumer and Professional Products (“CPP”) is a global provider of branded consumer and professional tools; residential, industrial and commercial fans; home storage and organization products; and products that enhance indoor and outdoor lifestyles. CPP sells products globally through a portfolio of leading brands including AMES, since 1774, Hunter, since 1886, True Temper, and ClosetMaid. Consolidation The consolidated financial statements include the accounts of Griffon and all subsidiaries. Intercompany accounts and transactions have been eliminated in consolidation. The results of operations of acquired businesses are included from the dates of acquisitions. Discontinued operations As of September 30, 2025 and 2024, assets and liabilities of discontinued operations primarily consisted of insurance claims, product liability, warranty and environmental reserves. There was no reported revenue for the years ended September 30, 2025, 2024 and 2023 related to discontinued operations. See Note 8 - Discontinued Operations for additional information. 53 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) Reclassifications Certain amounts in prior years have been reclassified to conform to the current year presentation. Use of estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting periods. These estimates may be adjusted due to changes in economic, industry or customer financial conditions, as well as changes in technology or demand. Significant estimates include expected loss allowances for credit losses on accounts receivable and sales returns, net realizable value of inventories, restructuring reserves, valuation of goodwill and intangible assets, assumptions associated with pension benefit obligations and income or expenses, useful lives associated with depreciation and amortization of intangible and fixed assets, warranty reserves, sales incentive accruals, assumption associated with stock based compensation valuation, income taxes and tax valuation reserves, environmental reserves, legal reserves, insurance reserves, the valuation of assets and liabilities of discontinued operations, assumptions associated with valuation of acquired assets and assumed liabilities of acquired companies and the accompanying disclosures. These estimates are based on management’s best knowledge of current events and actions Griffon may undertake in the future. Actual results may ultimately differ from these estimates. Cash and equivalents Griffon considers all highly liquid investments purchased with an initial maturity of three months or less to be cash equivalents. Cash equivalents primarily consist of overnight commercial paper, highly-rated liquid money market funds backed by U.S. Treasury securities and U.S. Agency securities. Griffon had cash in non-U.S. bank accounts of approximately $ 38,500 and $ 46,100 at September 30, 2025 and 2024, respectively. Substantially all U.S. cash and equivalents are in excess of FDIC insured limits. Griffon regularly evaluates the financial stability of all institutions and funds that hold its cash and equivalents. Fair value of financial instruments The carrying values of cash and cash equivalents, accounts receivable, accounts and notes payable and revolving credit and Term Loan B debt approximate fair value due to either the short-term nature of such instruments or the fact that the interest rate of the revolving credit debt is based upon current market rates. The fair value hierarchy, as outlined in the applicable accounting guidance, establishes a fair value hierarchy that requires the Company to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the hierarchy is based on the lowest level of input that is significant to the fair value measurement. The accounting guidance establishes three levels of inputs that may be used to measure fair value, as follows: • Level 1 inputs are measured and recorded at fair value based upon quoted prices in active markets for identical assets. • Level 2 inputs include inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in active markets for similar assets and liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of assets or liabilities. • Level 3 inputs are unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. The fair values of Griffon’s 2028 Senior Notes and Term Loan B facility approximated $ 972,338 and $ 450,684 , respectively, on September 30, 2025. Fair values were based upon quoted market prices (Level 1 inputs). Insurance contracts with a value of $ 5,249 at September 30, 2025 are measured and recorded at fair value based upon quoted prices in active markets for similar assets (Level 2 inputs) and are included in Other assets on the Consolidated Balance Sheets. 54 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) Items Measured at Fair Value on a Recurring Basis In the normal course of business, Griffon’s operations are exposed to the effect of changes in foreign currency exchange rates. To manage these risks, Griffon may enter into various derivative contracts such as foreign currency exchange contracts, including forwards and options. Griffon entered into several such contracts in order to lock into a foreign currency rate for planned settlements of trade and inter-company liabilities payable in USD as discussed below. At September 30, 2025 and 2024, Griffon had $ 41,000 and $ 67,500 of Australian dollar contracts at a weighted average rate of $ 1.50 and $ 1.47 , respectively, which qualified for hedge accounting. These hedges were all deemed effective as cash flow hedges with gains and losses related to changes in fair value deferred and recorded in Other comprehensive income (loss) and Prepaid and other current assets, or Accrued liabilities, until settlement (Level 2 inputs). Upon settlement, gains and losses were recognized in the Consolidated Statements of Operations and Comprehensive Income (Loss) in Cost of goods and services ("COGS"). Accumulated Other Comprehensive Income (“AOCI”) included deferred gains of $ 698 ($ 489 , net of tax) at September 30, 2025 and deferred losses of $ 660 ($ 462 , net of tax) at September 30, 2024. Upon settlement, gains of $ 2,919 , $ 1,120 and $ 3,991 were recognized in the Consolidated Statements of Operations and Comprehensive Income (Loss) in COGS during 2025, 2024 and 2023, respectively. All contracts expire in 30 to 90 days. At September 30, 2025 and 2024, Griffon had $ 21,000 and $ 20,500 of Chinese Yuan contracts at a weighted average rate of $ 7.10 and $ 7.11 , respectively, which qualified for hedge accounting. These hedges were all deemed effective as cash flow hedges with gains and losses related to changes in fair value deferred and recorded in AOCI and Prepaid and other current assets, or Accrued liabilities, until settlement (Level 2 inputs). Upon settlement, gains and losses are recognized in the Consolidated Statements of Operations and Comprehensive Income (Loss) in COGS. AOCI included deferred gains of $ 37 ($ 27 , net of tax) and deferred gains of $ 410 ($ 300 , net of tax) at September 30, 2025 and 2024, respectively. Upon settlement, losses of $ 974 , $ 1,936 and $ 2,313 were recorded in COGS during 2025, 2024 and 2023, respectively. All contracts expire in 31 to 273 days. At September 30, 2025 and 2024, Griffon had $ 6,150 and $ 13,497 , respectively, of Canadian dollar contracts at a weighted average rate of $ 1.40 and $ 1.35 , respectively. These contracts, which protect Canadian operations from currency fluctuations for U.S. dollar based purchases, do not qualify for hedge accounting, and fair value losses of $ 100 and $ 67 were recorded in Other assets and to Other income for the outstanding contracts, based on similar contract values (Level 2 inputs), for the years ended September 30, 2025 and 2024, respectively. Realized gains (losses) of $ 157 , $ 98 and $ 336 were recorded in Other income during 2025, 2024 and 2023, respectively. All contracts expire in 2 to 330 days . At September 30, 2025, Griffon had CAD 1,742 of Chinese Yuan contracts at a weighted average rate of CAD 5.17 . These contracts, which protect Canadian operations from currency fluctuations for Chinese Yuan based purchases, do not qualify for hedge accounting and fair value gains of $ 15 were recorded in Other assets and to Other income for the outstanding contracts, based on similar contract values (Level 2 inputs), for the year ended September 30, 2025. There were no realized gains recognized in Other income during 2025. All contracts expire in 30 to 359 days. Pension plan assets with a fair value of $ 132,376 at September 30, 2025, and $ 158,705 at September 30, 2024, respectively, are measured and recorded at fair value based upon quoted prices in active markets for identical assets (Level 1 inputs), quoted market prices for similar assets (Level 2 inputs) and fair value assumptions for unobservable inputs in which little or no market data exists (Level 3). The Company accounts for acquisitions under the acquisition method, in which assets acquired and liabilities assumed are recorded at fair value as of the date of acquisition using a method substantially similar to the goodwill impairment test methodology (Level 3 inputs). The operating results of the acquired companies are included in Griffon’s consolidated financial statements from the date of acquisition in each instance. 55 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) Non-U.S. currency translation Assets and liabilities of non-U.S. subsidiaries, where the functional currency is not the U.S. dollar, have been translated at year-end exchange rates and profit and loss accounts have been translated using weighted average exchange rates during the applicable fiscal year. Adjustments resulting from currency translation are recorded in AOCI as cumulative translation adjustments. The Company recognized foreign currency translation adjustment losses during 2025 of $ 6,569 and foreign currency translation adjustment gains of $ 10,137 during 2024. As of September 30, 2025 and 2024, the cumulative foreign currency translation recorded in AOCI resulted in losses of $ 45,155 and $ 38,586 , respectively. Assets and liabilities of an entity that are denominated in currencies other than that entity’s functional currency are re-measured into the functional currency using period end exchange rates, or historical rates where applicable to certain balances. Gains and losses arising on remeasurements are recorded within the Consolidated Statements of Operations and Comprehensive Income as a component of Other income (expense). Revenue recognition The Company recognizes revenue when performance obligations identified under the terms of contracts with its customers are satisfied. A performance obligation is a promise in a contract to transfer a distinct good or service, or a bundle of goods or services, to the customer, and is the unit of accounting. A contract with a customer is an agreement which both parties have approved, that creates enforceable rights and obligations, has commercial substance and with respect to which payment terms are identified and collectability is probable. Once the Company has entered into a contract or purchase order, it is evaluated to identify performance obligations. For each performance obligation, revenue is recognized when control of the promised products is transferred to the customer, or services are satisfied under the contract or purchase order, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those products or services (the transaction price). The Company’s performance obligations are recognized at a point in time related to the manufacture and sale of a broad range of products and components, and revenue is recognized when title, and risk and rewards of ownership, have transferred to the customer, which is generally upon shipment. Refer to Note 2 - Revenue for additional information. Accounts receivable, expected allowance for credit losses and concentrations of credit risk Accounts receivable is composed principally of trade accounts receivable, that arise from the sale of goods or services on account, and is stated at historical cost. A substantial portion of Griffon’s trade receivables are from Home Depot, whose financial condition is dependent on the construction and related retail sectors of the economy. As a percentage of consolidated accounts receivable, Home Depot was 9 % as of September 30, 2025 and 12 % as of September 30, 2024. Griffon performs continuing evaluations of the financial condition of its customers, and although Griffon generally does not require collateral, letters of credit may be required from customers in certain circumstances. Trade receivables are recorded at the stated amount, less expected allowance for credit losses and, when appropriate, for customer program reserves and cash discounts. The expected loss allowance represents estimated uncollectible receivables associated with potential customer defaults on contractual obligations (usually due to customers’ potential insolvency). The expected allowance for credit losses includes amounts for certain customers where a risk of default has been specifically identified, as well as an amount for customer defaults based on a formula when it is determined the risk of some default is probable and estimable, but cannot yet be associated with specific customers. The provision related to the expected allowance for credit losses is recorded in Selling, general and administrative ("SG&A") expenses. The Company writes off accounts receivable when they are deemed to be uncollectible. Customer program reserves and cash discounts are netted against accounts receivable when it is customer practice to reduce invoices for these amounts. The amounts netted against accounts receivable as of September 30, 2025 and September 30, 2024 were $ 46,766 and $ 64,211 , respectively. All accounts receivable amounts are expected to be collected in less than one year. The Company does not currently have customers or contracts that prescribe specific retainage provisions. 56 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) Inventories Inventories, stated at the lower of cost (first-in, first-out or average) or net realizable value, include material, labor and manufacturing overhead costs. Griffon’s businesses typically do not require inventory that is susceptible to becoming obsolete or dated. In general, HBP produces residential and commercial sectional garage doors, commercial rolling steel door and grille products, and CPP produces long-handled tools and landscaping products, and storage and organizational products, both in response to orders from customers of retailers and dealers or based on expected orders, as applicable. Long-lived assets, including definite intangible assets Property, plant and equipment includes the historical cost of land, buildings, equipment and significant improvements to existing plant and equipment or, in the case of acquisitions, a fair market value appraisal of such assets completed at the time of acquisition. Expenditures for maintenance, repairs and minor renewals are expensed as incurred. When property or equipment is sold or otherwise disposed of, the related cost and accumulated depreciation is removed from the respective accounts and the gain or loss is recognized. Depreciation expense, which includes amortization of assets under capital leases, was $ 39,734 , $ 37,901 and $ 43,056 in 2025, 2024 and 2023, respectively, and was calculated on a straight-line basis over the estimated useful lives of the assets. Depreciation included in SG&A expenses was $ 17,007 , $ 16,510 and $ 17,598 in 2025, 2024 and 2023, respectively. The remaining components of depreciation, attributable to manufacturing operations, are included in COGS. Estimated useful lives for property, plant and equipment are as follows: buildings and building improvements, 25 to 40 years; machinery and equipment, 2 to 15 years; and leasehold improvements, over the term of the lease or life of the improvement, whichever is shorter. Capitalized interest costs included in Property, plant and equipment were $ 3,489 , $ 2,228 and $ 1,463 for the years ended September 30, 2025, 2024 and 2023, respectively. The original cost of fully-depreciated property, plant and equipment remaining in use at September 30, 2025 was approximately $ 265,931 . Long-lived assets, including customer relationships and software, and tangible assets, primarily property, plant and equipment, are amortized over their expected useful lives, generally eight to twenty-five years , and involves significant assumptions and estimates. We assess the recoverability of the carrying amount of our long-lived assets, including amortizable intangible assets, whenever events or changes in circumstances indicate the carrying amount of the assets may not be recoverable. We evaluate the recoverability of such assets based on the expectations of undiscounted cash flows attributable to the asset group. If the sum of the expected future undiscounted cash flows are less than the carrying amount of the asset group, a loss would be recognized for the difference between the fair value and the carrying amount. No indicator of impairment existed for the CPP asset groups as of September 30, 2025. As of September 30, 2024, we tested long-lived intangible and tangible assets for impairment by comparing estimated future undiscounted cash flows of each CPP asset group to the carrying amount of the asset group and determined that an impairment did not exist. No event or indicator of impairment existed for the HBP assets groups as of September 30, 2025 and 2024. Goodwill and indefinite-lived intangibles Goodwill represents the excess of the cost of net assets acquired in business combinations over the fair value of the identifiable tangible and intangible assets acquired and liabilities assumed in a business combination. We test goodwill and indefinite-lived intangibles for impairment at least annually in the fourth quarter, and more frequently whenever events or circumstances change that would more likely than not reduce the fair value below the carrying amount. Such events or changes in circumstance include significant deterioration in overall economic conditions, changes in the business climate in which our reporting units operate, a decline in our market capitalization, operating performance indicators, when some portion of a reporting unit is disposed of or classified as held for sale, or when a change in the composition of reporting units occurs for other reasons, such as a change in operating segments. To test goodwill and indefinite-lived intangible assets for impairment, we may perform both a qualitative assessment and quantitative assessment. If we elect to perform a qualitative assessment, we consider operating results as well as circumstances impacting the operations or cash flows of the 57 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) reporting unit or indefinite-lived intangible assets, including macroeconomic conditions, industry and market conditions and reporting unit events and circumstances. For the quantitative test of goodwill, the assessment is based on both an income-based and market-based valuation approach. Under the income-based approach, we determine the fair value of a reporting unit by using discounted cash flows that require significant judgment and assumptions, such as our best estimate of future revenue, operating costs, cash flows, expected long-term cash flow growth rates (terminal value growth rates), and risk adjusted discount rates. Under the market-based approach, we determine the fair value of a reporting unit by applying those multiples exhibited by comparable publicly traded companies and those multiples paid in acquisitions of peer company transactions to the financial results of the reporting units. We then compare the fair value estimates resulting from the income and market-based valuations to the sum of Griffon’s market capitalization and net debt position to assess the reasonableness of the implied control premium. For the quantitative test of indefinite-lived intangible assets, we determine the fair value of indefinite-lived intangible assets by using the relief from royalty method, which estimates the value of a trademark by discounting to present value the hypothetical royalty payments that are saved by owning the asset rather than licensing it. If it is determined that an impairment exists, we recognize an impairment loss for the amount by which the carrying amount of the reporting unit or indefinite-lived intangible asset exceeds its estimated fair value. Fair value estimates are based on assumptions believed to be reasonable at the time, but such assumptions are subject to inherent uncertainty. Actual results may differ materially from those estimates. Any changes in key assumptions or management judgment with respect to a reporting unit or its prospects, which may result from a decline in Griffon’s stock price, a change in market conditions, market trends, interest rates or other factors outside of Griffon’s control, or significant underperformance relative to historical or projected future operating results, could result in a significantly different estimate of the fair value of Griffon’s reporting units and indefinite-lived intangible assets, which could result in an impairment charge in the future. During the third quarter of fiscal 2025, indicators of goodwill and indefinite-lived intangible asset impairment were present for the Hunter Fan reporting unit within the CPP reportable segment, driven by a decrease in year-to-date and forecasted sales and operating results primarily due to ongoing weak consumer demand coupled with the impact of increased tariffs disrupting historical customer ordering patterns. As such, we performed a quantitative assessment of the Hunter Fan reporting unit goodwill using both an income based and market-based valuation approach. We also performed a quantitative assessment of the Hunter Fan indefinite-lived intangible assets using the relief from royalty method. The goodwill impairment test resulted in a pre-tax, non-cash impairment charge of $ 136,612 , representing the remaining goodwill of the Hunter Fan reporting unit. Additionally, the indefinite-lived intangible asset test resulted in a pre-tax, non-cash impairment charge of $ 107,000 to the carrying amount of Hunter Fan's trademark. In preparation of our financial statements during the year ended September 30, 2025, we performed qualitative assessments of goodwill and indefinite-lived intangibles for our CPP and HBP reporting units, and concluded that it was not more likely than not that the fair values of these reporting units or indefinite-lived intangible assets were less than their carrying amounts as of the annual test date of September 30, 2025. For the year ended September 30, 2024, Griffon performed its annual impairment testing, and performed quantitative assessments of the CPP reporting unit's goodwill and indefinite-lived intangible assets, which did not result in an impairment. For the year ended September 30, 2023, Griffon performed quantitative assessments of the CPP reporting unit's goodwill and indefinite-lived intangible assets at interim and at the annual testing date, which did not result in an impairment of goodwill, however, the tests resulted in pre-tax, non-cash impairment charges of $ 109,200 to the gross carrying amount of trademarks. Griffon performed qualitative assessments for the HBP reporting unit goodwill and indefinite-lived intangibles and determined that indicators that fair value was less than the carrying amount were not present in fiscal years 2024 and 2023. Leases ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. We use the implicit rate when readily determinable. Our determination of the lease term may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. 58 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) The Company determines if an arrangement is a lease at inception. The ROU assets and short and long-term liabilities associated with our operating leases are shown as separate line items on our Consolidated Balance Sheets. Finance leases are included in property, plant, and equipment, net, other accrued liabilities, and other non-current liabilities. For operating leases, fixed lease payments are recognized as operating lease cost on a straight-line basis over the lease term. For finance leases and impaired operating leases, the ROU asset is depreciated on a straight-line basis over the remaining lease term, along with recognition of interest expense associated with accretion of the lease liability. For leases with a lease term of 12 months or less (a "Short-term" lease), any fixed lease payments are recognized on a straight-line basis over such term, and are not recognized on the Consolidated Balance Sheets. Variable lease cost for both operating and finance leases, if any, is recognized as incurred. The Company has lease agreements that contain both lease and non-lease components. For real estate leases, we account for lease components together with non-lease components (e.g., common-area maintenance). Income taxes We are subject to Federal, state and local income taxes in the U.S. and in various taxing jurisdictions outside the U.S. We recognize deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns in accordance with applicable accounting guidance for accounting for income taxes, using currently enacted tax rates in effect for the year in which the differences are expected to reverse. We record a valuation allowance when necessary to reduce deferred tax assets to the amount expected to be realized. Deferred tax assets are reduced by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Both positive and negative evidence are considered in forming our judgment as to whether a valuation allowance is appropriate, and more weight is given to evidence that can be objectively verified. Valuation allowances are reassessed whenever there are changes in circumstances that may cause a change in judgment. The accounting for uncertainty in income taxes requires a more-likely-than-not threshold for financial statement recognition of tax positions taken or expected to be taken in a tax return. We record, as needed, a liability for the difference between the benefit recognized for financial statement purposes and the tax position taken or expected to be taken on our tax return. To the extent that our assessment of such tax positions changes, the change in estimate is recorded in the period in which the determination is made. Interest and penalties recognized on the liability for unrecognized tax benefits is recorded as income tax expense. Research and development costs, shipping and handling costs and advertising costs Research and development costs are charged to SG&A expense as incurred and amounted to approximately $ 20,300 in 2025, $ 19,400 in 2024 and $ 18,100 in 2023. Total shipping and handling costs included in both COGS and SG&A were $ 121,671 in 2025, $ 125,120 in 2024 and $ 123,100 in 2023, of which $ 67,500 in 2025, $ 68,400 in 2024 and $ 67,300 in 2023 were included in SG&A. Advertising costs, which are expensed as incurred in SG&A, were $ 26,600 in 2025, $ 25,600 in 2024 and $ 28,400 in 2023. Risk, retention and insurance Griffon’s property and casualty insurance programs contain various deductibles that, based on Griffon’s experience, are reasonable and customary for a company of its size and risk profile. Griffon generally maintains deductibles for claims and liabilities related primarily to workers’ compensation, general, product and automobile liability as well as property damage and business interruption losses resulting from certain events. Griffon does not consider any of the deductibles to represent a material risk to Griffon. Griffon accrues for claim exposures that are probable of occurrence and can be reasonably estimated. Insurance is maintained to transfer risk beyond the level of self-retention and provides protection on both an individual claim and annual aggregate basis. 59 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) Pension benefits Griffon sponsors defined and supplemental benefit pension plans for certain retired employees. Annual amounts relating to these plans are recorded based on actuarial projections, which include various actuarial assumptions, including discount rates, assumed rates of return, compensation increases and turnover rates. Actuarial assumptions used to determine pension liabilities, assets and expense are reviewed annually and modified based on current economic conditions and trends. The expected return on plan assets is determined based on the nature of the plan's investments and expectations for long-term rates of return. The discount rate used to measure obligations is based on a corporate bond spot-rate yield curve that matches projected future benefit payments, with the appropriate spot rate applicable to the timing of the projected future benefit payments. Assumptions used in determining Griffon’s obligations under the defined benefit pension plans are believed to be reasonable, based on experience and advice from independent actuaries; however, differences in actual experience or changes in assumptions may materially impact Griffon’s financial position or results of operations. All of the defined benefit plans are frozen and have ceased accruing benefits. The Company recognized non-service cost components of net periodic (benefit) cost of ($ 5,411 ), $ 137 and $ 866 during 2025, 2024, and 2023 respectively. Issued but not yet effective accounting pronouncements In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures . The new standard was issued to improve transparency and decision usefulness of income tax disclosures by providing information that helps investors better understand how an entity's operations, tax risks, tax planning and operational opportunities affect its tax rate and prospects for future cash flows. The standard requires significant additional disclosures focused on income taxes paid and the rate reconciliation table. Specifically, the amendments in the standard require the Company to disclose disaggregated: (1) income taxes paid by federal, state, and foreign, (2) continuing operations pre-tax income between domestic and foreign, and (3) continuing operations income tax expense by federal, state and foreign. The standard also requires the Company to disclose specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. This standard is effective for the Company beginning with our fiscal year 2026, and can be applied prospectively or retrospectively. While the Company is currently evaluating the guidance to determine the impact it may have on its consolidated financial statements, the Company does not expect the adoption of this standard to have a material impact on its financial position, results of operations, or cash flows. In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses . The amendments in this update require disclosure and further disaggregation, in the notes to financial statements, of specified information about certain costs and expenses. The required disclosures include the amounts of purchases of inventory, employee compensation, depreciation, intangible asset amortization, and depreciation, depletion, and amortization recognized as part of oil and gas producing activities included in each relevant expense caption. Additionally, further disclosures are required for certain amounts already required to be disclosed under current GAAP, a qualitative description of amounts remaining in relevant expense captions that are not separately disaggregated quantitatively, and the total amount of selling expenses, and on an annual basis, the definition of selling expenses. The ASU is effective for the Company beginning with the Company's fiscal year 2027 and interim reporting periods beginning with the Company's 2028 fiscal year. Implementation of this standard may be applied prospectively or retrospectively. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements. 60 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) New Accounting Standards Adopted In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures . The new standard provides improvements to reportable segment disclosure requirements through amendments that require disclosure of significant segment expenses and other segment items on an interim and annual basis and requires all annual disclosures about a reportable segment's profit or loss and assets to be made on an interim basis. The standard also requires the disclosure of the chief operating decision maker's ("CODM") title and position and an explanation of how the CODM uses the reported measure(s) of segment profit or loss in assessing segment performance and deciding how to allocate resources. The standard also clarifies that if the CODM uses more than one measure in assessing segment performance and deciding how to allocate resources, a company may report the additional segment profit or loss measure(s), and that companies with a single reportable segment must provide all disclosures required by this amendment. The Company adopted this standard for the year ended September 30, 2025. The standard was applied retrospectively to all prior periods presented in the financial statements. Refer to Note 19 - Reportable Segments, for additional information. NOTE 2 – REVENUE The Company recognizes revenue when performance obligations identified under the terms of contracts with its customers are satisfied. A performance obligation is a promise in a contract to transfer a distinct good or service, or a bundle of goods or services, to the customer, and is the unit of accounting. A contract with a customer is an agreement which both parties have approved, that creates enforceable rights and obligations, has commercial substance and with respect to which payment terms are identified and collectability is probable. Once the Company has entered into a contract or purchase order, it is evaluated to identify performance obligations. For each performance obligation, revenue is recognized when control of the promised products is transferred to the customer, or services are satisfied under the contract or purchase order, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those products or services (the transaction price). A contract's transaction price is allocated to each distinct performance obligation and recognized as revenue when each performance obligation is satisfied. A majority of the Company’s contracts have a single performance obligation which represents, in most cases, the product being sold to the customer. To a lesser extent, some contracts include multiple performance obligations such as a product, the related installation, and extended warranty services. These contracts require judgment in determining the number of performance obligations. For contracts with multiple performance obligations, judgment is required to determine whether performance obligations specified in these contracts are distinct and should be accounted for as separate revenue transactions for recognition purposes. In these types of contracts, the Company allocates the total transaction price to each performance obligation in an amount based on the estimated relative standalone selling prices of the promised goods or services underlying each performance obligation. The Company uses an observable price to determine the stand-alone selling price for separate performance obligations or a cost plus margin approach when one is not available. The transaction price includes variable consideration, such as discounts and volume rebates, when it is probable that a significant reversal of revenue recognized will not occur. Variable consideration is determined using either the expected value or the most likely amount of consideration to be received based on historical experience and the specific facts and circumstances at the time of evaluation. See Note 19 - Reportable Segments for revenue from contracts with customers disaggregated by end markets, segments and geographic location. The Company’s performance obligations are recognized at a point in time related to the manufacture and sale of a broad range of products and components and revenue is recognized when title, and risk and rewards of ownership, have transferred to the customer, which is generally upon shipment. A majority of the Company's revenue is short cycle in nature with shipments occurring within one year from order and does not include a material long-term financing component, implicitly or explicitly. Payment terms generally range between 15 to 90 days and vary by the location of the business, the type of products manufactured to be sold and the volume of products sold, among other factors. The Company recognizes revenue from product sales when all factors are met, including when control of a product transfers to the customer upon its shipment, completion of installation, testing, certification or other substantive acceptance required under the contract. Other than standard product warranty provisions, sales arrangements provide for no significant post-shipment obligations on the Company. From time-to-time and for certain customers, rebates and other sales incentives, promotional 61 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) allowances or discounts are offered, typically related to customer purchase volumes, all of which are fixed or determinable and are classified as a reduction of revenue and recorded at the time of sale. Griffon provides for sales returns and allowances based upon historical returns experience. The Company includes shipping costs billed to customers in revenue and the related shipping costs in either COGS or SG&A expenses. The majority of the Company’s contracts offer assurance-type warranties in connection with the sale of a product to a customer. Assurance-type warranties provide a customer with assurance that the related product will function as the parties intended because it complies with agreed-upon specifications. Such warranties do not represent a separate performance obligation. Payment terms vary depending on the type and location of the customer and the products or services offered. Generally, the period between the time revenue is recognized and the time payment is due is not significant. Shipping and handling charges are not considered a separate performance obligation. Additionally, all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected from a customer (e.g., sales, use, value added, and some excise taxes) are excluded from revenue. NOTE 3 — ACQUISITIONS Griffon continually evaluates potential acquisitions that either strategically fit within its portfolio or expand its portfolio into new product lines or adjacent markets. Griffon has completed a number of acquisitions that have been accounted for as business combinations, in which assets acquired and liabilities assumed are recorded at fair value as of the date of acquisition and have resulted in the recognition of goodwill. The operating results of the business acquisitions are included in Griffon’s consolidated financial statements from the date of acquisition. On July 1, 2024, Griffon announced that its subsidiary, AMES expanded the scope of its Australian operations by acquiring substantially all the assets of Pope, a leading Australian provider of residential watering products, from The Toro Company (NYSE:TTC) for a purchase price of approximately AUD 21,800 (approximately $ 14,500 ) in cash. During the year ended September 30, 2025, the purchase price was finalized and allocated to acquired intangibles, net of deferred taxes, of AUD 2,940 (approximately $ 1,960 ) and goodwill of AUD 2,640 (approximately $ 1,758 ), which was assigned to the CPP segment and is not deductible for income tax purposes. The purchase price was also allocated to inventory of AUD 16,132 (approximately $ 10,752 ), property, plant and equipment, net of AUD 1,289 (approximately $ 859 ) and accrued liabilities of AUD 1,194 (approximately $ 795 ). During the year ended September 30, 2024, SG&A expenses included acquisition costs of $ 441 . There were no acquisition costs recorded during the years ended September 30, 2025 and 2023. NOTE 4 — INVENTORIES The following table details the components of inventory: At September 30, 2025 At September 30, 2024 Raw materials and supplies $ 89,305 $ 92,366 Work in process 13,685 13,923 Finished goods 337,782 319,200 Total $ 440,772 $ 425,489 In connection with the Company's restructuring activities described in Note 10 - Restructuring Charges, during the year ended September 30, 2024 CPP recorded an inventory impairment charge of $ 23,763 in COGS to adjust inventory to its net realizable value. There were no impairment charges recorded during the year ended September 30, 2025. 62 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) NOTE 5 — PROPERTY, PLANT AND EQUIPMENT The following table details the components of property, plant and equipment, net: At September 30, 2025 At September 30, 2024 Land, building and building improvements $ 160,233 $ 153,076 Machinery and equipment (1) 498,656 472,030 Leasehold improvements 38,317 37,833 697,206 662,939 Accumulated depreciation and amortization ( 403,678 ) ( 374,642 ) Total $ 293,528 $ 288,297 (1) Machinery and Equipment includes approximately $ 33,239 and $ 36,443 of construction in progress assets as of September 30, 2025 and September 30, 2024, respectively. In connection with the expansion of CPP's global sourcing strategy which was completed as of September 30, 2024, certain owned manufacturing locations which concluded operations have met the criteria to be classified as held for sale, and the net book value of these properties as of September 30, 2025 totaled $ 5,609 . During the year ended September 30, 2025, in connection with the goodwill and indefinite-lived intangible asset impairment event described in Note 7 - Goodwill and Intangibles, the Company also evaluated property, plant and equipment assets for potential impairment. The review did not result in any impairment charges to property, plant and equipment. Except as described in Note 10 - Restructuring Charges, no event or indicator of impairment occurred during the year ended September 30, 2024 which required additional impairment testing of property, plant and equipment. NOTE 6 – CREDIT LOSSES The Company is exposed to credit losses primarily through sales of products and services. Trade receivables are recorded at their stated amount, less expected allowances for credit losses and, when appropriate, for customer program reserves and cash discounts. The Company’s expected loss allowance methodology for trade receivables is primarily based on the aging method of the accounts receivable balances and the financial condition of its customers. The expected allowance for doubtful accounts represents estimated uncollectible receivables associated with potential customer defaults on contractual obligations (usually due to customers’ potential insolvency), discounts related to early payment of accounts receivable by customers and estimates for returns. The allowance for credit losses includes amounts for certain customers where a risk of default has been specifically identified, as well as an amount for customer defaults, based on a formula, when it is determined the risk of some default is probable and estimable, but cannot yet be associated with specific customers. The provision related to the expected allowance for credit losses is recorded in SG&A expenses. The Company writes-off accounts receivable when they are deemed to be uncollectible. The Company also considers current and expected future economic and market conditions when determining any estimate of credit losses. Generally, estimates used to determine the allowance are based on assessment of anticipated payment and all other historical, current and future information that is reasonably available. All accounts receivable amounts are expected to be collected in less than one year. Based on a review of the Company's policies and procedures across all segments, including the aging of its trade receivables, recent write-off history and other factors related to future macroeconomic conditions, Griffon determined that its method to determine credit losses and the amount of its allowances for bad debts is in accordance with this guidance in all material respects. 63 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) The following table provides a roll-forward of the allowance for credit losses that is deducted from the amortized cost basis of accounts receivable to present the net amount expected to be collected: Beginning Balance, September 30, 2023 $ 11,264 Provision for expected credit losses 636 Amounts written off charged against the allowance ( 1,325 ) Other, primarily foreign currency translation 411 Ending Balance, September 30, 2024 $ 10,986 Provision for expected credit losses 566 Amounts written off charged against the allowance ( 1,755 ) Other, primarily foreign currency translation 289 Ending Balance, September 30, 2025 $ 10,086 NOTE 7 — GOODWILL AND INTANGIBLES Goodwill at September 30, 2025 and 2024 was $ 192,917 and $ 329,393 , respectively. During the third quarter of fiscal 2025, indicators of goodwill impairment were present for the Hunter Fan reporting unit within the CPP reportable segment, driven by a decrease in year-to-date and forecasted sales and operating results primarily due to ongoing weak consumer demand coupled with the impact of increased tariffs disrupting historical customer ordering patterns. As such, we performed a quantitative assessment of the Hunter Fan reporting unit goodwill using both an income - based and market-based valuation approach. This impairment test resulted in a pre-tax, non-cash goodwill impairment charge of $ 136,612 , representing the remaining goodwill of the Hunter Fan reporting unit. In connection with the preparation of our financial statements for the fiscal year ended September 30, 2025, Griffon performed a qualitative assessment of the CPP reporting units and determined that indicators that fair value was less than the carrying amount were not present. For the fiscal years ended September 30, 2024 and 2023, the Company performed a quantitative assessment of the CPP reporting units using both an income-based and market-based approach, which did not result in a goodwill impairment . For the HBP reporting unit, we performed a qualitative assessment and determined that indicators that fair value was less than the carrying amount were not present in fiscal years 2025, 2024 and 2023. The following table provides a summary of the carrying value of goodwill by segment as of September 30, 2025, 2024 and 2023. At September 30, 2023 Goodwill from acquisitions (a) Foreign currency translation adjustments At September 30, 2024 Impairment Charges Goodwill from acquisitions (b) Foreign currency translation adjustments At September 30, 2025 Consumer and Professional Products $ 136,611 $ 1,483 $ 46 $ 138,140 $ ( 136,612 ) $ 230 $ ( 94 ) $ 1,664 Home and Building Products 191,253 — — 191,253 — — — 191,253 Total $ 327,864 $ 1,483 $ 46 $ 329,393 $ ( 136,612 ) $ 230 $ ( 94 ) $ 192,917 (a) The change in goodwill for the CPP segment relates to the initial purchase price allocation of the Pope acquisition in 2024. (b) The change in goodwill for the CPP segment is due to final purchase price allocation adjustments recorded during the year ended September 30, 2025 related to the 2024 Pope acquisition. 64 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) Indicators of impairment were present for our Hunter Fan indefinite-lived intangible asset during the third quarter of fiscal 2025 due to the reasons discussed above. As such, we determined the fair value of Hunter Fan's indefinite-lived intangible asset by using a relief from royalty method, which estimates the value of a trademark by discounting to present value the hypothetical royalty payments that are saved by owning the asset rather than licensing it. We compared the estimated fair value to the carrying amount, resulting in a pre-tax, non-cash impairment charge of $ 107,000 to the carrying amount of Hunter Fan's trademark recorded in the third quarter of fiscal 2025. In preparation of the financial statements for the year ended September 30, 2025, Griffon performed qualitative assessments for the CPP indefinite-lived intangibles and determined that indicators that fair value was less than the carrying amount were not present. For the year ended September 30, 2024, the impairment tests did not result in impairment charges to CPP's gross carrying amount of intangible assets; however, for the year ended September 30, 2023, the impairment tests resulted in a pre-tax non-cash impairment charge of $ 109,200 to the gross carrying amount of our trademarks in the CPP segment. Griffon performed qualitative assessments for the HBP indefinite-lived intangibles and determined that indicators that fair value was less than the carrying amount were not present during 2025, 2024 and 2023. The following table provides the gross carrying value and accumulated amortization for each major class of intangible asset: At September 30, 2025 At September 30, 2024 Gross Carrying Amount Accumulated Amortization Average Life (Years) Gross Carrying Amount Accumulated Amortization Customer relationships & other $ 449,203 $ 153,507 17 $ 450,784 $ 134,296 Unpatented technology 18,596 10,147 10 17,350 6,859 Total amortizable intangible assets 467,799 163,654 468,134 141,155 Trademarks 183,969 — 291,803 — Total intangible assets $ 651,768 $ 163,654 $ 759,937 $ 141,155 ____________________________ In 2025, the gross carrying amount of intangible assets was unfavorably impacted by $ 1,169 related to foreign currency translation. We also evaluated our definite-lived intangible assets for potential impairment in connection with the goodwill impairment event noted above. The review did not result in any impairment charges related to definite-lived intangible assets. Amortization expense for intangible assets subject to amortization was $ 23,280 , $ 22,803 and $ 22,389 in 2025, 2024, and 2023, respectively. Amortization expense for each of the next five years and thereafter, based on current intangible balances and classifications, is estimated as follows: 2026 - $ 23,600 ; 2027 - $ 23,600 ; 2028 - $ 23,600 ; 2029 - $ 23,500 and 2030 - $ 23,300 ; thereafter - $ 186,545 . 65 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) NOTE 8 — DISCONTINUED OPERATIONS The following amounts which summarize the total assets and liabilities related to discontinued activities have been segregated from Griffon’s continuing operations, and are reported as assets and liabilities of discontinued operations in the Consolidated Balance Sheets: At September 30, 2025 At September 30, 2024 Assets of discontinued operations: Prepaid and other current assets $ 1,302 $ 648 Other long-term assets 4,699 3,417 Total assets of discontinued operations $ 6,001 $ 4,065 Liabilities of discontinued operations: Accrued liabilities, current $ 3,956 $ 4,498 Other long-term liabilities 4,770 3,270 Total liabilities of discontinued operations $ 8,726 $ 7,768 At September 30, 2025 and 2024, Griffon’s liabilities for discontinued operations primarily related to insurance claims, income taxes, product liability, warranty claims and environmental reserves totaling $ 8,726 and $ 7,768 , respectively. Griffon's assets for discontinued operations primarily relate to insurance claims. The increase in assets and liabilities was primarily associated with insurance claims receivable and payable. There was no reported revenue in 2025, 2024 and 2023 related to discontinued operations. NOTE 9 — ACCRUED LIABILITIES The following table details the components of accrued liabilities: At September 30, 2025 At September 30, 2024 Compensation $ 70,013 $ 82,413 Interest 4,246 4,532 Warranties and rebates 14,124 16,900 Insurance 12,369 12,535 Rent, utilities and freight 4,536 5,294 Income and other taxes 23,256 17,459 Marketing and advertising 3,315 5,401 Restructuring 4,043 12,998 Other 16,805 24,386 Total $ 152,707 $ 181,918 66 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non US currencies in thousands, except per share data) NOTE 10 – RESTRUCTURING CHARGES Griffon announced in May 2023 that CPP was expanding its global sourcing strategy to include long handled tools, material handling, and wood storage and organization product lines for the U.S. market. This initiative was successfully completed as of September 30, 2024. As a result of this global sourcing expansion initiative, manufacturing operations have concluded at four manufacturing sites and four wood mills, resulting in a total facility footprint reduction of approximately 1.2 million square feet, or approximately 15 % of CPP's square footage, and a headcount reduction of approximately 600 . The closed locations have met the held for sale criteria and have been classified as such on our Consolidated Balance Sheets as of September 30, 2025 and September 30, 2024. The net book value of these properties as of September 30, 2025 and September 30, 2024 totaled $ 5,609 and $ 14,532 , respectively. The adoption of an asset-light business model for these U.S. products has positioned CPP to better serve customers with a more flexible and cost-effective sourcing model that leverages supplier relationships around the world, and improved its competitive positioning. Implementation of this strategy over the duration of the project resulted in charges of $ 133,777 , which included $ 51,082 of cash charges for employee retention and severance, operational transition, and facility and lease exit costs, and $ 82,695 of non-cash charges primarily related to asset write-downs. In addition, there were $ 2,678 of capital investments to effectuate the project. This excluded cash proceeds from the sale of real estate and equipment, which through September 30, 2024 were $ 13,271 , and excluded future proceeds from the sale of remaining real estate and equipment. During the year ended September 30, 2025, cash proceeds related to the sale of the remaining real estate and equipment held for sale totaled $ 17,729 . In the year ended September 30, 2024, CPP incurred pre-tax restructuring and related exit costs approximating $ 41,309 . Cash charges totaled $ 17,546 and non-cash, asset-related charges totaled $ 23,763 ; the cash charges included $ 5,856 for one-time termination benefits and other personnel related costs and $ 11,690 for facility exit costs. Non-cash charges related to $ 23,763 recorded to adjust inventory to its net realizable value. In the year ended September 30, 2023, CPP incurred pre-tax restructuring and related exit costs approximating $ 92,468 . Cash charges totaled $ 33,536 and non-cash, asset-related charges totaled $ 58,932 ; the cash charges included $ 16,772 for one-time termination benefits and other personnel-related costs and $ 16,764 for facility exit costs. Non-cash charges included a $ 21,832 impairment charge related to certain fixed assets at several manufacturing locations and $ 37,100 recorded to adjust inventory to its net realizable value. A summary of the restructuring and other related charges included in COGS and SG&A expenses in the Company's Consolidated Statements of Operations were as follows: For the Year Ended September 30, 2024 2023 Cost of goods and services $ 35,806 $ 82,028 Selling, general and administrative expenses 5,503 10,440 Total restructuring charges $ 41,309 $ 92,468 For the Year Ended September 30, 2024 2023 Personnel related costs $ 5,856 $ 16,772 Facilities, exit costs and other 11,690 16,764 Non-cash facility and other 23,763 58,932 Total $ 41,309 $ 92,468 67 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non US currencies in thousands, except per share data) The following table summarizes the accrued liabilities of the Company's restructuring actions: Cash Charges Cash Charges Non-Cash Charges Personnel related costs Facilities & Exit Costs Facility and Other Costs Total Accrued liability at September 30, 2022 $ 386 $ 264 $ — $ 650 Charges 16,772 16,764 58,932 92,468 Payments ( 3,051 ) ( 11,477 ) — ( 14,528 ) Non-cash charges (1) — — ( 58,932 ) ( 58,932 ) Accrued liability at September 30, 2023 $ 14,107 $ 5,551 $ — $ 19,658 Charges 5,856 11,690 23,763 41,309 Payments ( 11,781 ) ( 12,425 ) — ( 24,206 ) Non-cash charges (1) — — ( 23,763 ) ( 23,763 ) Accrued liability at September 30, 2024 $ 8,182 $ 4,816 $ — $ 12,998 Payments ( 5,355 ) ( 3,600 ) — ( 8,955 ) Accrued liability at September 30, 2025 $ 2,827 $ 1,216 $ — $ 4,043 (1) Non-cash charges in Facility and Other Costs primarily represent the non-cash write-off of certain long-lived assets and inventory that has no recoverable value in connection with certain facility closures. NOTE 11 – WARRANTY LIABILITY CPP and HBP offer warranties against product defects for periods generally ranging from one to ten years , with limited lifetime warranties on certain door models. Typical warranties require CPP and HBP to repair or replace the defective products during the warranty period at no cost to the customer. At the time revenue is recognized, Griffon records a liability for warranty costs, estimated based on historical experience, and periodically assesses its warranty obligations and adjusts the liability as necessary. CPP offers an express limited warranty for a period of ninety days on all products from the date of the original purchase unless otherwise stated on the product or packaging from the date of original purchase. CPP provides limited lifetime warranties on certain products. Warranty costs expected to be incurred in the next 12 months are classified in accrued liabilities. Warranty costs expected to be incurred beyond one year are classified in other long-term liabilities. The short-term warranty liability was $ 10,143 as of September 30, 2025 and $ 13,050 as of September 30, 2024. The long-term warranty liability was $ 1,239 at both September 30, 2025 and 2024. Changes in Griffon’s warranty liability, included in Accrued liabilities, were as follows: Years Ended September 30, 2025 2024 Balance, beginning of period $ 13,050 $ 20,781 Warranties issued and changes in estimated pre-existing warranties 19,300 23,253 Actual warranty costs incurred ( 22,207 ) ( 30,984 ) Balance, end of period $ 10,143 $ 13,050 68 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non US currencies in thousands, except per share data) NOTE 12 — LONG-TERM DEBT Debt at September 30, 2025 and 2024 consisted of the following: At September 30, 2025 Outstanding Balance Original Issuer Premium (Discount) Capitalized Fees & Expenses Balance Sheet Coupon Interest Rate Senior Notes due 2028 (a) $ 974,775 $ 121 $ ( 4,880 ) $ 970,016 5.75 % Term Loan B due 2029 (b) 449,000 ( 461 ) ( 4,169 ) 444,370 Variable Revolver due 2028 (b) — — ( 2,113 ) ( 2,113 ) Variable Non U.S. lines of credit (d) — — ( 34 ) ( 34 ) Variable Other debt (d) 251 — — 251 Variable Totals 1,424,026 ( 340 ) ( 11,196 ) 1,412,490 less: Current portion ( 8,103 ) — — ( 8,103 ) Long-term debt $ 1,415,923 $ ( 340 ) $ ( 11,196 ) $ 1,404,387 At September 30, 2024 Outstanding Balance Original Issuer Premium (Discount) Capitalized Fees & Expenses Balance Sheet Coupon Interest Rate Senior notes due 2028 (a) $ 974,775 $ 169 $ ( 6,900 ) $ 968,044 5.75 % Term Loan B due 2029 (b) 457,000 ( 599 ) ( 5,420 ) 450,981 Variable Revolver due 2028 (b) 107,500 — ( 2,859 ) 104,641 Variable Non U.S. lines of credit (d) — — ( 2 ) ( 2 ) Variable Other debt (d) 410 — ( 22 ) 388 Variable Totals 1,539,685 ( 430 ) ( 15,203 ) 1,524,052 less: Current portion ( 8,155 ) — — ( 8,155 ) Long-term debt $ 1,531,530 $ ( 430 ) $ ( 15,203 ) $ 1,515,897 Interest expense consists of the following for 2025, 2024 and 2023. Year Ended September 30, 2025 Effective Interest Rate Cash Interest Amort. Debt (Premium) Discount Amort. Deferred Cost & Other Fees Total Interest Expense Senior notes due 2028 (a) 5.95 % $ 56,058 $ ( 48 ) $ 2,020 $ 58,030 Term Loan B due 2029 (b) 6.94 % 30,131 137 1,251 31,519 Revolver due 2028 (b) Variable 5,945 — 746 6,691 Non U.S. lines of credit (d) Variable 17 — 70 87 Other debt (d) Variable 450 — — 450 Capitalized interest ( 765 ) — — ( 765 ) Totals $ 91,836 $ 89 $ 4,087 $ 96,012 69 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non US currencies in thousands, except per share data) Year Ended September 30, 2024 Effective Interest Rate Cash Interest Amort. Debt (Premium) Discount Amort. Deferred Cost & Other Fees Total Interest Expense Senior notes due 2028 (a) 5.93 % $ 56,050 $ ( 48 ) $ 2,020 $ 58,022 Term Loan B due 2029 (b) 8.17 % 36,193 163 1,304 37,660 Revolver due 2028 (b) Variable 8,018 — 746 8,764 Non U.S. lines of credit (d) Variable 43 — 15 58 Other debt (d) Variable 586 1 1 588 Capitalized interest ( 1,006 ) — — ( 1,006 ) Totals $ 99,884 $ 116 $ 4,086 $ 104,086 Year Ended September 30, 2023 Effective Interest Rate Cash Interest Amort. Debt Premium Amort. Deferred Cost & Other Fees Total Interest Expense Senior notes due 2028 (a) 5.95 % $ 56,050 $ ( 48 ) $ 2,020 $ 58,022 Term Loan B due 2029 (b) 7.49 % 35,321 172 1,398 36,891 Revolver due 2028 (b) Variable 4,282 — 646 4,928 Finance lease - real estate (c) 5.60 % 680 — — 680 Non U.S. lines of credit (d) Variable 630 — 42 672 Other debt (d) Variable 392 — 2 394 Capitalized interest ( 142 ) — — ( 142 ) Totals $ 97,213 $ 124 $ 4,108 $ 101,445 Minimum payments under debt agreements for the next five years are as follows: $ 8,103 in 2026, $ 8,045 in 2027, $ 982,819 in 2028, $ 425,047 in 2029, $ 12 in 2030 and no debt payments due thereafter. (a) During 2020, Griffon issued, at par, $ 1,000,000 of 5.75 % Senior Notes due 2028 (the "Senior Notes"). Proceeds from the Senior Notes were used to redeem $ 1,000,000 of 5.25 % Senior Notes due in 2022. In connection with the issuance and exchange of the Senior Notes, Griffon capitalized $ 16,448 of underwriting fees and other expenses incurred, which is being amortized over the term of such notes. During 2022, Griffon purchased $ 25,225 of Senior Notes in the open market at a weighted average discount of 91.82 % of par, or $ 23,161 . As of September 30, 2025, outstanding Senior Notes due totaled $ 974,775 ; interest is payable semi-annually on March 1 and September 1. The Senior Notes are senior unsecured obligations of Griffon guaranteed by certain domestic subsidiaries, and subject to certain covenants, limitations and restrictions. The Senior Notes were registered under the Securities Act of 1933, as amended (the "Securities Act") via an exchange offer. The fair value of the Senior Notes approximated $ 972,338 on September 30, 2025 based upon quoted market prices (Level 1 inputs). At September 30, 2025, $ 4,880 of underwriting fees and other expenses incurred remained to be amortized. (b) On January 24, 2022, Griffon amended and restated its Credit Agreement (the "Credit Agreement") to provide for a new $ 800,000 Term Loan B facility, due January 24, 2029, in addition to the revolving credit facility (the "Revolver") provided for under the Credit Agreement. The Term Loan B facility was issued at 99.75 % of par value. Since that time, Griffon has prepaid $ 325,000 aggregate principal amount of the Term Loan B, which permanently reduced the outstanding balance. In connection with the prepayment of the Term Loan B, Griffon recognized charges of $ 437 and $ 6,296 on the prepayment of debt in 2023 and 2022, respectively. The charges were comprised of write-offs of unamortized debt issuance costs of $ 386 70 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non US currencies in thousands, except per share data) and $ 5,575 for 2023 and 2022, respectively, and the original issue discount of $ 51 and $ 721 for 2023 and 2022, respectively. As of September 30, 2025, the Term Loan B outstanding balance was $ 449,000 . On June 26, 2024, Griffon further amended its Credit Agreement to favorably reprice the Term Loan B facility. The amendment reduced the margin above SOFR by 0.25 %, eliminated the credit spread adjustment and reduced the SOFR floor from 0.50 % to 0 %. In connection with the amendment, Griffon recognized a $ 1,700 loss on debt extinguishment during the year ended September 30, 2024 in the Company's Consolidated Statements of Operations, primarily consisting of the write-off of unamortized debt issuance costs and original issue discount related to portions of the Term Loan B facility that were repaid and then reborrowed from new lenders. At September 30, 2025, $ 4,169 of costs incurred remained to be amortized over the term of the loan. The Term Loan B bears interest at the Term SOFR rate plus a spread of 2.00 % ( 6.13 % as of September 30, 2025). The Term Loan B facility continues to require nominal quarterly principal payments of $ 2,000 , potential additional annual principal payments based on a percentage of excess cash flow and certain secured leverage thresholds, and a final balloon payment due at maturity. Term Loan B borrowings may generally be repaid without penalty. Once repaid, Term Loan B borrowings may not be reborrowed. The Term Loan B facility is subject to the same affirmative and negative covenants that apply to the Revolver (as described below), but is not subject to any financial maintenance covenants. Term Loan B borrowings are secured by the same collateral that secures borrowings under the Revolver, on an equal and ratable basis. The fair value of the Term Loan B facility approximated $ 450,684 on September 30, 2025 based upon quoted market prices (Level 1 inputs). On August 1, 2023, Griffon amended and restated the Credit Agreement to increase the maximum borrowing availability under the Revolver from $ 400,000 to $ 500,000 and extend the maturity date of the Revolver from March 22, 2025 to August 1, 2028. In the event the 2028 Senior Notes are not repaid, refinanced, or replaced prior to December 1, 2027, the Revolver will mature on December 1, 2027. The amendment also modified certain other provisions of the Credit Agreement, including increasing the letter of credit sub-facility under the Revolver from $ 100,000 to $ 125,000 and increasing the customary accordion feature from a minimum of $ 375,000 to a minimum of $ 500,000 . The Revolver also includes a multi-currency sub-facility of $ 200,000 . Borrowings under the Revolver may be repaid and re-borrowed at any time. Interest is payable on borrowings at either a SOFR, SONIA or base rate benchmark rate, plus an applicable margin, which adjusts based on financial performance. Griffon's SOFR loans accrue interest at Term SOFR plus a credit adjustment spread and a margin of 1.75 % ( 5.98 % at September 30, 2025); SONIA loans accrue interest at SONIA Base Rate plus a credit adjustment spread and a margin of 1.75 % ( 5.75 % at September 30, 2025); and base rate loans accrue interest at prime rate plus a margin of 0.75 % ( 8.00 % at September 30, 2025). At September 30, 2025, under the Credit Agreement, there were no outstanding borrowings on the Revolver; outstanding standby letters of credit were $ 14,328 ; and $ 485,672 was available, subject to certain loan covenants, for borrowing at that date. The Revolver has certain financial maintenance tests including a maximum total leverage ratio, a maximum senior secured leverage ratio and a minimum interest coverage ratio, as well as customary affirmative and negative covenants and events of default. The negative covenants place limits on Griffon's ability to, among other things, incur indebtedness, incur liens, and make restricted payments and investments. Both the Revolver and Term Loan B borrowings under the Credit Agreement are guaranteed by Griffon’s material domestic subsidiaries and are secured, on a first priority basis, by substantially all domestic assets of the Company and the guarantors. (c) On September 28, 2023, the Company closed on the exercise of its lease purchase option, as permitted under the lease agreement, to acquire ownership of the manufacturing facility located in Ocala, Florida for a cash purchase price of $ 23,207 . The Ocala lease had a maturity date in 2025 and bore interest at a fixed rate of approximately 5.6 %. As a result of exercising the purchase option, the Company no longer has any future lease obligations related to this real estate. Refer to Note 22 - Leases for additional information. (d) In November 2012, Garant G.P. (“Garant”), a Griffon wholly owned subsidiary, entered into a CAD 15,000 revolving credit facility, which expired in December 2024. In January 2025, Garant entered into a new CAD 20,000 revolving credit facility that matures in January 2026 but is renewable upon mutual agreement with the lender. The new facility accrues interest at Canadian Overnight Repo Rate Average ("CORRA") plus a credit adjustment spread and a margin of 1.20 % ( 4.06 % as of September 30, 2025). At September 30, 2025, there were no outstanding borrowings under the revolving credit facility with CAD 20,000 ($ 14,376 as of September 30, 2025) available. 71 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non US currencies in thousands, except per share data) During 2023, Griffon Australia Holdings Pty Ltd and its Australian subsidiaries (collectively, "Griffon Australia") amended its AUD 15,000 receivable purchase facility to AUD 30,000 . The receivable purchase facility was renewed in March 2025 and now matures in March 2026, but is renewable upon mutual agreement with the lender. The receivable purchase facility accrues interest at Bank Bill Swap Rate plus 1.25 % per annum ( 4.79 % at September 30, 2025). At September 30, 2025, there was no balance outstanding under the receivable purchase facility with AUD 30,000 ($ 19,707 as of September 30, 2025) available. The receivable purchase facility is secured by substantially all of the assets of Griffon Australia and its subsidiaries. Griffon Australia is required to maintain a certain minimum equity level. In July 2018, the AMES Companies UK Ltd and its subsidiaries (collectively, "Ames UK") entered into a GBP 14,000 term loan, GBP 4,000 mortgage loan and GBP 5,000 revolver, which matured in July 2023. Prior to maturity, on June 30, 2023, AMES UK paid off and cancelled the GBP 14,000 term loan and GBP 4,000 mortgage loan. The payoff amounts were GBP 7,525 ($ 9,543 ) and GBP 2,451 ($ 3,108 ), respectively. Upon maturity in July 2023, the GBP 5,000 revolver had no balance and was not renewed. (e) The balance in other long-term debt consists primarily of finance leases. At September 30, 2025, Griffon and its subsidiaries were in compliance with the terms and covenants of its credit and loan agreements. NOTE 13 – EMPLOYEE BENEFIT PLANS Griffon offers defined contribution plans to most of its U.S. employees. In addition to employee contributions to the plans, Griffon makes contributions based upon various percentages of compensation and/or employee contributions, which were $ 12,115 in 2025, $ 10,319 in 2024 and $ 10,857 in 2023. Fiscal year 2025 includes $ 1,525 of employer contributions to a qualified replacement plan that were funded by excess assets from the Hunter Pension Plan. Effective August 5, 2025, the Company implemented a new retiree medical plan for certain eligible employees. Under the plan eligible retirees and their covered spouses are provided company-paid medical, prescription drug and dental coverage through the Company's group health plans(or if such coverage cannot be provided, an equivalent benefit), along with reimbursement for certain uncovered expenses. It is the Company's practice to fund these benefits as incurred. The Company recognized a benefit obligation of $ 6,527 as of September 30, 2025, accumulated other comprehensive income, net of $ 4,063 and benefit expense of $ 1,071 . The discount rate utilized in the determination of the projected benefit obligation and net periodic benefit cost was 5.60 %. The annual increase in cost of benefits (health care cost trend rate) is assumed to be 7.50 % and gradually decreases to a rate of 6.60 % over three years . The Company recognized $ 1,016 and will recognize $ 5,362 , of non-cash charges in fiscal 2025 and 2026, respectively, related to the implementation of this plan. The Company also provides healthcare and life insurance benefits for certain groups of retirees through several plans. For certain employees, the benefits are at fixed amounts per retiree and are partially contributory by the retiree. The post-retirement benefit obligation was $ 1,545 and $ 1,670 as of September 30, 2025 and 2024. The weighted average discount rate utilized to determine the benefit obligation was 4.87 % and 4.08 % as of September 30, 2025 and 2024, respectively. The accumulated other comprehensive income for these plans was $ 311 and $ 306 as of September 30, 2025 and 2024, respectively, and the 2025, 2024 and 2023 expense was $ 19 , $ 4 and $ 17 , respectively. The weighted average discount rate utilized to determine the net periodic benefit expense was 4.69 %, 5.61 % and 5.52 % in 2025, 2024 and 2023, respectively. It is the Company’s practice to fund these benefits as incurred. Griffon also has qualified and non-qualified defined benefit plans covering certain employees which provide benefits based on years of service and employee compensation. Over time, these amounts will be recognized as part of net periodic pension costs in the Consolidated Statements of Operations and Comprehensive Income (Loss). During fiscal year 2025 Griffon was responsible for overseeing the management of the investments of it's qualified defined benefit plans. The Company uses the services of an investment manager to manage the plans' assets based on agreed upon risk profiles. The primary objective of the qualified defined benefit plan is to secure participant retirement benefits. As such, the key objective in this plan’s financial management is to promote stability and, to the extent appropriate, growth in the funded status. 72 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) Financial objectives are established in conjunction with a review of current and projected plan financial requirements. The fair values of a majority of the plan assets were determined by the plans’ trustee using quoted market prices for identical instruments (Level 1 inputs) as of September 30, 2025 and 2024. The fair value of various other investments was determined by the plans' trustees using direct observable market corroborated inputs, including quoted market prices for similar assets (Level 2 inputs). A small amount of plan assets are invested in private equity which consist primarily of investments in private companies which are valued using the net asset values provided by the underlying private investment companies as a practical expedient (Level 3 inputs). The Clopay AMES Pension Plan and the AMES supplemental executive retirement plan are frozen to new entrants and participants in the plans no longer accrue benefits. The Hunter Fan Pension Plan (the "Plan") was terminated with an effective date of April 30, 2024. This was communicated to plan participants in February 2024. At the time of termination, the Plan was fully funded and the Company did not anticipate making additional funding contributions as of the benefit distribution dates. During the year ended September 30, 2025, the Plan made lump sum payments in the amount of $ 4,830 to those participants who elected a lump sum distribution. Additionally, the Company selected an insurance company to hold the annuity and provide pension benefits to the plan participants currently receiving benefit payments and those that elected to continue their future benefit with an annuity provider. This decision included a transfer of plan assets valued at $ 10,859 . In July 2025, Griffon completed the termination of the Plan and $ 6,100 of excess cash was transferred to the Company, a portion of which was transferred directly to a qualified replacement plan. During the year ended September 30, 2025, the Company recognized a gain on the termination of the Plan of $ 2,181 , net of excise taxes, in the Consolidated Statements of Operations and Comprehensive Income (Loss). The Company recognized non-service cost components of net periodic (benefit) cost of ($ 5,411 ), $ 137 and $ 866 during 2025, 2024, and 2023 respectively. Griffon uses judgment to establish the assumptions used in determining the future liability of the plan, as well as the investment returns on the plan assets. The expected return on assets assumption used for pension expense was developed through analysis of historical market returns, current market conditions and past experience of plan investments. The long-term rate of return assumption represents the expected average rate of earnings on the funds invested, or to be invested, to provide for the benefits included in the benefit obligations. The assumption is based on several factors including historical market index returns, the anticipated long-term asset allocation of plan assets and the historical return. The discount rate assumption is determined by developing a yield curve based on high quality bonds with maturities matching the plans’ expected benefit payment stream. The plans’ expected cash flows are then discounted by the resulting year-by-year spot rates. A 10 % change in the discount rate or return on assets would not have a material effect on the financial statements of Griffon. Net periodic (benefits) costs were as follows: Defined Benefits for the Years Ended September 30, Supplemental Benefits for the Years Ended September 30, 2025 2024 2023 2025 2024 2023 Net periodic (benefits) costs: Interest cost $ 5,506 $ 7,050 $ 6,814 $ 387 $ 504 $ 488 Expected return on plan assets ( 9,387 ) ( 10,172 ) ( 10,213 ) — — — Pension termination settlement ( 4,621 ) — — — — — Amortization of: Actuarial loss 2,087 2,250 3,314 617 505 463 Total net periodic (benefits) costs $ ( 6,415 ) $ ( 872 ) $ ( 85 ) $ 1,004 $ 1,009 $ 951 The tax benefits in 2025, 2024 and 2023 for the amortization of pension costs in Other comprehensive income (gain) were $( 402 ), $ 578 and $ 793 , respectively. The weighted-average assumptions used in determining the net periodic (benefits) costs were as follows: 73 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) Defined Benefits for the Years Ended September 30, Supplemental Benefits for the Years Ended September 30, 2025 2024 2023 2025 2024 2023 Discount rate 4.76 % 5.63 % 5.17 % 4.46 % 5.53 % 5.02 % Expected return on assets 6.75 % 6.75 % 6.72 % — % — % — % Plan assets and benefit obligation of the defined and supplemental benefit plans were as follows: Defined Benefits at September 30, Supplemental Benefits at September 30, 2025 2024 2025 2024 Change in benefit obligation: Benefit obligation at beginning of fiscal year $ 145,746 $ 139,224 $ 10,776 $ 10,882 Interest cost 5,506 7,050 387 504 Benefits paid ( 11,124 ) ( 11,576 ) ( 1,893 ) ( 1,896 ) Benefits paid related to pension termination ( 15,784 ) — — — Actuarial (gain) loss ( 2,823 ) 11,048 870 1,286 Benefit obligation at end of fiscal year 121,521 145,746 10,140 10,776 Change in plan assets: Fair value of plan assets at beginning of fiscal year 158,705 146,997 — — Actual return on plan assets 6,048 21,933 — — Company contributions 631 1,351 1,893 1,896 Benefits paid ( 11,124 ) ( 11,576 ) ( 1,893 ) ( 1,896 ) Benefits paid related to pension termination ( 15,784 ) — — — Return of excess plan assets ( 6,100 ) — — Fair value of plan assets at end of fiscal year 132,376 158,705 — — Projected benefit obligation in excess of plan assets $ 10,855 $ 12,959 $ ( 10,140 ) $ ( 10,776 ) Amounts recognized in the statement of financial position consist of: Non-Current Assets $ 10,855 $ 12,959 $ — $ — Accrued liabilities — — ( 1,813 ) ( 1,823 ) Other liabilities (long-term) — — ( 8,327 ) ( 8,953 ) Total Liabilities 10,855 12,959 ( 10,140 ) ( 10,776 ) Net actuarial losses 28,367 25,314 6,953 6,700 Deferred taxes ( 5,957 ) ( 5,316 ) ( 1,665 ) ( 3,037 ) Total accumulated other comprehensive loss, net of tax 22,410 19,998 5,288 3,663 Net amount recognized at September 30, $ 33,265 $ 32,957 $ ( 4,852 ) $ ( 7,113 ) Accumulated benefit obligations $ 121,521 $ 145,746 $ 10,140 $ 10,776 Information for plans with accumulated benefit obligations in excess of plan assets: ABO $ 121,521 $ 145,746 $ 10,140 $ 10,776 PBO 121,521 145,746 10,140 10,776 Fair value of plan assets 132,376 158,705 — — 74 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) Actuarial gains as of September 30, 2025 were primarily due to the increase in the discount rate; conversely, actuarial losses as of September 30, 2024 were primarily due to the decrease in the discount rate. The weighted-average assumptions used in determining the benefit obligations were as follows: Defined Benefits at September 30, Supplemental Benefits at September 30, 2025 2024 2025 2024 Weighted average discount rate 5.09 % 4.76 % 4.52 % 4.46 % Estimated future benefit payments to retirees, which reflect expected future service, are as follows: For the years ending September 30, Defined Benefits Supplemental Benefits 2026 $ 10,929 $ 1,813 2027 10,869 1,637 2028 10,772 1,461 2029 10,655 1,287 2030 10,470 1,118 2031-2035 48,453 3,453 During 2026, Griffon expects to contribute $ 1,567 to the Clopay Ames Pension Plan and expects to contribute $ 1,813 to Supplemental Benefits that will be funded from the general assets of Griffon. The Clopay AMES Pension Plan is covered by the Pension Protection Act of 2006. The Adjusted Funding Target Attainment Percent for the Clopay AMES Pension Plan as of January 1, 2025 was 95.0 %. Since the plan was in excess of the 80 % funding threshold there were no plan restrictions. There are no catch up contributions for the plan expected in 2026. The actual and weighted-average asset allocation for qualified benefit plans were as follows: At September 30, 2025 2024 Target Cash and equivalents 2.4 % 2.9 % — % Equity securities 5.4 % 26.4 % 5.0 % Fixed income 80.0 % 48.6 % 85.0 % Other 12.2 % 22.1 % 10.0 % Total 100.0 % 100.0 % 100.0 % The following is a description of the valuation methodologies used for plan assets measured at fair value: Government and agency securities – When quoted market prices are available in an active market, the investments are classified as Level 1. When quoted market prices are not available in an active market, the investments are classified as Level 2. Equity securities – The fair values reflect the closing price reported on a major market where the individual mutual fund securities are traded in equity securities. These investments are classified within Level 1 of the valuation hierarchy. Debt securities – The fair values are based on a compilation of primarily observable market information or a broker quote in a non-active market where the individual mutual fund securities are invested in debt securities. These investments are classified within Level 1 and Level 2 of the valuation hierarchy. Commingled funds – The fair values are determined using NAV provided by the administrator of the fund. The NAV is based on the value of the underlying assets owned by the trust/entity, minus its liabilities, and then divided by the number of shares 75 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) outstanding. These investments are generally classified within Level 2 or 3, as appropriate, of the valuation hierarchy and can be liquidated on demand. Interest in limited partnerships and hedge funds - One limited partnership investment is a private equity fund and the fair value is determined by the fund managers based on the net asset values provided by the underlying private investment companies as a practical expedient. These investments are classified within Level 2 of the valuation hierarchy. Fully benefit-responsive investment contracts - The Plan holds fully benefit-responsive investment contracts that are reported at contract value, which is the value of principal and interest under the terms of the annuity contract. The following table presents the fair values of Griffon’s pension and post-retirement plan assets by asset category: At September 30, 2025 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Cash and equivalents $ 3,167 $ — $ — $ 3,167 Government agency securities 10,091 8,154 — 18,245 Debt instruments 75,344 9,284 — 84,628 Equity securities 7,134 — — 7,134 Commingled funds — — 6,585 6,585 Limited partnerships and hedge fund investments — 9,404 — 9,404 Other securities 2,205 — — 2,205 Subtotal $ 97,941 $ 26,842 $ 6,585 $ 131,368 Accrued income and plan receivables 1,008 Total $ 132,376 At September 30, 2024 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Cash and equivalents $ 4,522 $ — $ — $ 4,522 Government and agency securities 5,890 5,116 — 11,006 Debt instruments 42,705 6,144 — 48,849 Equity securities 41,786 — — 41,786 Commingled funds — 4,859 9,979 14,838 Limited partnerships and hedge fund investments — 20,177 — 20,177 Other securities 17,004 — — 17,004 Subtotal $ 111,907 $ 36,296 $ 9,979 $ 158,182 Accrued income and plan receivables 523 Total $ 158,705 76 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) The following table represents Level 3 significant unobservable inputs for the years ended September 30, 2025 and 2024: Significant Unobservable Inputs (Level 3) As of October 1, 2023 10,459 Purchases, issuances and settlements ( 1,591 ) Gains and losses 1,111 As of September 30, 2024 $ 9,979 Purchases, issuances and settlements ( 5,448 ) Gains and losses 2,054 As of September 30, 2025 $ 6,585 Griffon has an Employee Stock Ownership Plan ("ESOP") that covered substantially all domestic employees. The ESOP was frozen as of September 30, 2024; this means that, for the plan years after this date, no additional employees will become participants under the ESOP and no new voluntary contributions will be made to the ESOP. Prior to this date, all U.S. employees of Griffon, who are not members of a collective bargaining unit, were automatically eligible to participate in the plan on the October 1 st following completion of one qualifying year of service (as defined in the plan). Securities were allocated to participants’ individual accounts based on the proportion of each participant’s aggregate compensation (not to exceed $ 330 for the plan year ended September 30, 2024), to the total of all participants’ compensation. Shares of the ESOP that had been allocated to employee accounts were charged to expense based on the fair value of the shares transferred and were treated as outstanding in determining earnings per share. Through December 31, 2024, dividends paid on shares held by the ESOP were used to offset debt service on the ESOP Loans; since such date, dividends have been, and will be, deposited directly into the ESOP participants' accounts. Dividends paid on shares held in participant accounts are utilized to allocate shares from the aggregate number of shares to be released, equal in value to those dividends, based on the closing price of Griffon common stock on the dividend payment date. During 2025 the final loan payment was made by the ESOP to the Company and compensation expense for the period was fully offset by dividends paid. Compensation expense under the ESOP was $ 8,533 in 2024 and $ 20,583 in 2023. The cost of the shares held by the ESOP and not yet allocated to employees is reported as a reduction of Shareholders’ Equity. The fair value of the unallocated ESOP shares as of September 30, 2024 based on the closing price of Griffon’s stock was $ 1,250 . The ESOP shares were as follows: At September 30, 2025 2024 Allocated shares 3,977,753 4,234,713 Unallocated shares — 17,852 Total 3,977,753 4,252,565 77 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non US currencies in thousands, except per share data) NOTE 14 – INCOME TAXES Income taxes have been based on the following components of Income before taxes: For the Years Ended September 30, 2025 2024 2023 Domestic $ 101,537 $ 292,409 $ 106,209 Non-U.S. 25,834 4,241 6,473 $ 127,371 $ 296,650 $ 112,682 Provision (benefit) for income taxes on income was comprised of the following: For the Years Ended September 30, 2025 2024 2023 Current $ 104,746 $ 83,179 $ 72,860 Deferred ( 28,485 ) 3,574 ( 37,795 ) Total $ 76,261 $ 86,753 $ 35,065 U.S. Federal $ 45,683 $ 59,480 $ 23,612 State and local 17,290 15,328 5,899 Non-U.S. 13,288 11,945 5,554 Total provision $ 76,261 $ 86,753 $ 35,065 Differences between the effective income tax rate applied to Income before taxes and the U.S. Federal statutory income tax rate are presented in the table below. For the Years Ended September 30, 2025 2024 2023 U.S. Federal statutory income tax rate 21.0 % 21.0 % 21.0 % State and local taxes, net of Federal benefit 5.5 % 3.7 % ( 0.2 ) % Non-U.S. taxes - foreign permanent items and taxes 3.0 % 1.0 % 1.4 % Change in tax contingency reserves — % ( 0.5 ) % ( 0.4 ) % Tax Reform-Repatriation of Foreign Earnings and GILTI ( 2.1 ) % ( 0.5 ) % 0.5 % Change in valuation allowance 2.7 % 2.8 % 3.9 % Other non-deductible/non-taxable items, net ( 0.5 ) % — % — % Non-deductible officer's compensation 5.6 % 1.9 % 5.1 % Research and U.S. foreign tax credits ( 0.9 ) % ( 0.3 ) % ( 0.9 ) % Goodwill impairment 27.4 % — % — % Share based compensation ( 2.8 ) % ( 0.7 ) % 0.8 % Other 1.0 % 0.8 % ( 0.1 ) % Effective tax rate 59.9 % 29.2 % 31.1 % 78 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non US currencies in thousands, except per share data) The tax effect of temporary differences that give rise to future deferred tax assets and liabilities are as follows: At September 30, 2025 2024 Deferred tax assets: Bad debt reserves $ 2,103 $ 2,491 Inventory reserves 8,219 7,086 Deferred compensation (equity compensation and defined benefit plans) 6,739 7,036 Compensation benefits 6,121 5,052 Insurance reserve 1,918 2,411 Restructuring reserve 826 2,616 Warranty reserve 4,392 5,130 Lease liabilities 46,454 47,824 Net operating loss 27,750 25,299 Tax credits 5,933 5,933 Research & development 10,329 4,510 Other reserves and accruals 5,160 5,167 125,944 120,555 Valuation allowance ( 30,703 ) ( 26,989 ) Total deferred tax assets 95,241 93,566 Deferred tax liabilities: Goodwill and intangibles ( 99,174 ) ( 126,523 ) Property, plant and equipment ( 19,872 ) ( 19,903 ) Right-of-use assets ( 43,498 ) ( 45,112 ) Unremitted foreign earnings ( 1,514 ) ( 1,896 ) Other ( 1,068 ) ( 723 ) Total deferred tax liabilities ( 165,126 ) ( 194,157 ) Net deferred tax liabilities $ ( 69,885 ) $ ( 100,591 ) The components of the net deferred tax liability, by balance sheet account, were as follows: At September 30, 2025 2024 Other assets $ 209 $ 495 Assets held for sale — 947 Other liabilities ( 70,948 ) ( 103,194 ) Liabilities of discontinued operations 854 1,161 Net deferred liability $ ( 69,885 ) $ ( 100,591 ) In 2025 and 2024, the net increases in the valuation allowance of $ 3,714 and $ 8,997 , respectively are the result of a determination that certain state and foreign net operating losses will not be realized. At September 30, 2025 and 2024, Griffon's policy election under APB 23 is to indefinitely reinvest the undistributed earnings of certain non-U.S. subsidiaries. As of September 30, 2025, we have approximately $ 122,964 of undistributed earnings of non-U.S. subsidiaries. Of these undistributed earnings, $ 38,703 were previously subjected to U.S. federal income tax. As of September 30, 2025, we recognized a deferred tax liability of $ 1,514 for estimated non-U.S. withholding taxes on the non-U.S. earnings that are not indefinitely reinvested. The Company has not provided deferred taxes on any other outside basis differences in its investments in the non-U.S. subsidiaries as these other outside basis differences are currently considered indefinitely reinvested. The Company may repatriate non-indefinitely reinvested earnings of its non-U.S. subsidiaries where excess cash has accumulated and the Company determines that it is appropriate and tax efficient. Accordingly, the Company 79 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non US currencies in thousands, except per share data) continues to reinvest all other undistributed earnings of its non-U.S. subsidiaries and may be subject to additional non-U.S. withholding taxes and U.S. state income taxes if it reverses its indefinite reinvestment assertion in the future. At September 30, 2025, Griffon had no loss carryforwards for U.S. tax purposes and $ 75,849 for non-U.S. tax purposes. At September 30, 2024, Griffon had no loss carryforwards for U.S. tax purposes and $ 63,217 for non-U.S. tax purposes. The non-U.S. loss carryforwards expire in varying amounts beginning in 2027 to indefinite carryforward. At September 30, 2025 and 2024, Griffon had state and local loss carryforwards of $ 221,855 and $ 228,485 , respectively. The state and local loss carryforwards expire in varying amounts beginning in 2026 to indefinite carryforward. At September 30, 2025 and 2024, Griffon had federal tax credit carryforwards of $ 5,933 in both years, which expire in 2028. We believe it is more likely than not that the benefit from certain federal, state, and non-U.S. tax attributes will not be realized. In recognition of this risk, we have provided a valuation allowance as of September 30, 2025 and 2024 of $ 30,703 and $ 26,989 , respectively, on the deferred tax assets. As it becomes probable that the benefits of these attributes will be realized, the reversal of valuation allowance will be recognized as a reduction of income tax expense. Griffon files U.S. Federal, state and local tax returns, as well as applicable returns in Canada, Australia, U.K. and other non-U.S. jurisdictions. Griffon’s U.S. Federal income tax returns are no longer subject to income tax examination for years before 2022. Griffon's major U.S. state and other non-U.S. jurisdictions are no longer subject to income tax examinations for years before 2017. Various U.S. state and statutory tax audits are currently underway. The following is a roll forward of unrecognized tax benefits: Balance at September 30, 2023 $ 6,292 Additions based on tax positions related to the current year 154 Additions based on tax positions related to prior years 35 Reductions based on tax positions related to prior years ( 2,735 ) Lapse of Statutes ( 140 ) Balance at September 30, 2024 $ 3,606 Additions based on tax positions related to the current year 39 Additions based on tax positions related to prior years 11 Reductions based on tax positions related to prior years ( 130 ) Lapse of Statutes ( 440 ) Balance at September 30, 2025 $ 3,086 If recognized, the amount of potential unrecognized tax benefits that would impact Griffon’s effective tax rate is $ 1,603 . Griffon recognizes potential accrued interest and penalties related to unrecognized tax benefits in income tax expense. At September 30, 2025 and 2024, the combined amount of accrued interest and penalties related to tax positions taken or to be taken on Griffon’s tax returns and recorded as part of the reserves for uncertain tax positions was $ 402 and $ 310 , respectively. Griffon cannot reasonably estimate the extent to which other existing liabilities for uncertain tax positions may increase or decrease within the next twelve months as a result of the progression of ongoing tax audits or other events. Griffon believes that it has adequately provided for all open tax years by tax jurisdiction. The Organization for Economic Co-operation and Development released the Global Anti-base Erosion Model Rules for Pillar Two (“Pillar Two”), which defined a 15% global minimum tax. Australia, Canada, U.K., Ireland, and other countries have enacted or are considering changes in their tax laws and regulations based on Pillar Two, some of which became effective for the Company in 2025. The Company has evaluated the impact of Pillar Two under the safe harbor provisions and currently there is no impact to the Company's financial statements. On July 4, 2025, the One Big Beautiful Bill Act ("OBBBA") was enacted in the U.S. The OBBBA includes significant tax related provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The legislation 80 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non US currencies in thousands, except per share data) has multiple effective dates, with certain provisions effective in the Company's fiscal year 2025 and others to be implemented through 2027. The Company evaluated the OBBBA and there is no material impact on its financial position or results of operations in the current year. NOTE 15 – STOCKHOLDERS’ EQUITY AND EQUITY COMPENSATION During 2025, 2024 and 2023, the Company declared and paid, in quarterly increments, cash dividends totaling $ 0.72 per share, $ 0.60 per share and $ 0.45 per share, respectively. Additionally, on April 19, 2023, the Board of Directors declared a special cash dividend of $ 2.00 per share, paid on May 19, 2023 to shareholders of record as of the close of business on May 9, 2023. The Company currently intends to pay dividends each quarter; however, payment of dividends is determined by the Board of Directors at its discretion based on various factors, and no assurance can be provided as to the payment of future dividends. Dividends paid on shares in the ESOP through December 31, 2024 were used to offset ESOP loan payments and recorded as a reduction of debt service payments and compensation expense. The ESOP loan was paid in full as of December 31, 2024 and dividends paid after that date are paid in cash directly to participant accounts. For all dividends, a dividend payable was established for the holders of restricted shares; such dividends will be released upon vesting of the underlying restricted shares. At September 30, 2025, accrued dividends were $ 2,962 . On November 18, 2025, the Board of Directors declared a cash dividend of $ 0.22 per share, payable on December 16, 2025 to shareholders of record as of the close of business on November 28, 2025. On January 29, 2016, shareholders approved the Griffon Corporation 2016 Equity Incentive Plan (the "Original Incentive Plan") pursuant to which, among other things, awards of performance shares, performance units, stock options, stock appreciation rights, restricted shares, restricted stock units, deferred shares and other stock-based awards may be granted. On January 31, 2018, shareholders approved Amendment No. 1 to the Original Incentive Plan pursuant to which, among other things, 1,000,000 shares were added to the Original Incentive Plan; on January 30, 2020, shareholders approved Amendment No. 2 to the Original Incentive Plan, pursuant to which 1,700,000 shares were added to the Original Incentive Plan; on February 17, 2022, shareholders approved the Amended and Restated 2016 Equity Incentive Plan (the “Amended Incentive Plan”), which amended and restated the Original Incentive Plan and pursuant to which, among other things, 1,200,000 shares were added to the Original Incentive Plan; and on March 20, 2024, shareholders approved an amendment to add 2,600,000 shares to the Amended Incentive Plan. Options granted under the Amended Incentive Plan may be either “incentive stock options” or nonqualified stock options, which generally expire ten years after the date of grant and are granted at an exercise price of not less than 100 % of the fair market value at the date of grant. The maximum number of shares of common stock available for award under the Amended Incentive Plan is 8,850,000 ( 600,000 of which may be issued as incentive stock options), plus (i) any shares that were reserved for issuance under the Original Incentive Plan as of the effective date of the Original Incentive Plan, and (ii) any shares underlying awards outstanding on such date under the 2011 Incentive Plan that were subsequently canceled or forfeited. As of September 30, 2025, 1,895,135 shares were available for grant. Compensation expense for restricted stock and restricted stock units is recognized ratably over the required service period based on the fair value of the grant, calculated as the number of shares or units granted multiplied by the stock price on date of grant, and for performance shares, including performance units, the likelihood of achieving the performance criteria. The Company recognizes forfeitures as they occur. Compensation expense for restricted stock granted to four senior executives is calculated as the target number of shares granted, upon achieving certain performance criteria or market conditions. The Monte Carlo Simulation Model is used to estimate the grant-date fair value restricted stock awards that include market conditions. Compensation cost related to stock-based awards with graded vesting, generally over a period of 3 years, is recognized using the straight-line attribution method and recorded within SG&A. 81 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) The following table summarizes the Company’s compensation expense relating to all stock-based incentive plans: For the Years Ended September 30, 2025 2024 2023 Restricted stock $ 25,483 $ 18,305 $ 20,529 ESOP (1) — 8,533 20,583 Total stock-based compensation $ 25,483 $ 26,838 $ 41,112 ________________________ (1) During the year ended September 30, 2023, special dividend ESOP charges included in compensation expense were $ 15,494 . A summary of restricted stock activity, inclusive of restricted stock units, for 2025 is as follows: Shares Weighted Average Grant- Date Fair Value Unvested at September 30, 2024 2,417,200 $ 37.96 Granted 595,798 81.30 Vested ( 1,267,142 ) 77.21 Forfeited ( 113,401 ) 29.94 Unvested at September 30, 2025 1,632,455 66.79 The fair value of restricted stock which vested during 2025, 2024, and 2023 was $ 97,833 , $ 80,861 and $ 25,863 , respectively. Unrecognized compensation expense related to non-vested shares of restricted stock was $ 37,911 at September 30, 2025 and will be recognized over a weighted average vesting period of 1.8 years. At September 30, 2025, a total of approximately 3,527,590 shares of Griffon’s authorized Common Stock were reserved for issuance in connection with stock compensation plans. During 2025, Griffon granted 579,858 shares of restricted stock and restricted stock units to its employees. This included 137,479 shares of restricted stock and 5,432 restricted stock units granted to forty-three executives and key employees, subject to certain performance conditions, with a vesting period of thirty-six months with a total fair value of $ 9,735 , or a weighted average fair value of $ 68.12 per share. This also included 436,947 shares of restricted stock granted to four senior executives with a vesting period of thirty-six months and a two-year post-vesting holding period, subject to the achievement of certain performance criteria and market conditions, relating to required levels of return on invested capital and the relative total shareholder return of Griffon's common stock as compared to a market index. So long as the minimum performance and market conditions are attained, the amount of shares that can vest will range from a minimum of 72,827 to a maximum of 436,947 , with the target number of shares being 145,649 . The total fair value of these restricted shares, assuming achievement of the performance and market conditions at target, is approximately $ 12,372 , or a weighted average fair value of $ 84.95 per share. Additionally, Griffon granted 15,940 shares of restricted stock to the non-employee directors of Griffon with a vesting period of one year and a fair value of $ 1,100 , or a weighted average fair value of $ 69.03 per share. During the year ended September 30, 2025, 590,366 shares granted were issued out of treasury stock. On November 18, 2025, Griffon granted 147,141 shares of restricted stock to 29 executives and key employees, subject to certain performance conditions, with a vesting period of thirty-six months , with a total fair value of $ 9,855 , or a weighted average fair value of $ 66.86 per share. Griffon also granted 531,456 shares of restricted stock to four senior executives with a vesting period of thirty-six months and a two -year post-vesting holding period, subject to the achievement of certain performance criteria and market conditions relating to required levels of return on invested capital and the relative total shareholder return of Griffon's common stock as compared to a market index. So long as the minimum performance and market conditions are attained, the amount of shares that can vest will range from a minimum of 88,578 to a maximum of 531,456 , with the target number of shares being 177,152 . The total estimated fair value of these restricted shares, assuming 82 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) achievement of the performance and market conditions at target, is $ 15,073 , or a weighted average fair value of $ 85.09 per share (based on the target number of shares). On November 12, 2024, the Board of Directors approved an increase of $ 400,000 to Griffon's share repurchase authorization. Under the authorized share repurchase program, the Company may, from time to time, purchase shares of its common stock in the open market, including pursuant to a 10b5-1 plan, pursuant to an accelerated share repurchase program or issuer tender offer, or in privately negotiated transactions. During the year ended September 30, 2025, Griffon purchased 1,897,182 shares of common stock under the repurchase program, for a total of $ 134,680 , or $ 70.99 per share, excluding excise taxes of $ 1,329 . As of September 30, 2025, $ 298,013 remained available for the purchase of common stock under these Board authorized repurchase programs. On February 20, 2024, Griffon repurchased 1,500,000 shares of its common stock, par value $ 0.25 per share, pursuant to a stock purchase and cooperation agreement executed by the Company and Voss Value Master Fund, L.P., Voss Value-Oriented Special Situations Fund, L.P and four separately managed accounts of which Voss Capital, LLC is the investment manager, in a private transaction. The purchase price per share was $ 65.50 , for an aggregate purchase price of $ 98,250 . During the year ended September 30, 2025, 583,978 shares, with a market value of $ 45,284 , or $ 77.54 per share, were withheld to settle employee taxes due upon the vesting of restricted stock, and were added to treasury stock. This excludes excise tax benefits of $ 528 for the year ended September 30, 2025. During the year ended September 30, 2025, we accrued $ 1,329 in connection with the share repurchases described above, which was partially offset by the reversal of $ 528 of excise taxes to adjust for a benefit related to employee vesting and a $ 107 net benefit on ESOP contributions. As of September 30, 2025, $ 694 was accrued for excise taxes related to employee share repurchases. NOTE 16 – COMMITMENTS AND CONTINGENCIES Purchase Commitments Purchase obligations are generally for the purchase of goods and services in the ordinary course of business. Griffon uses blanket purchase orders to communicate expected requirements to certain vendors. Purchase obligations reflect those purchase orders where the commitment is considered to be firm. Amounts purchased under such commitments were $ 218,603 , $ 159,362 and $ 184,422 for the years ended September 30, 2025, 2024 and 2023, respectively. Aggregate future minimum purchase obligations at September 30, 2025 are $ 218,344 in 2026, $ 789 in 2027, $ 376 in 2028, $ 218 in 2029, $ 178 in 2030 and $ 0 thereafter. Legal and environmental Peekskill Site. Lightron Corporation (“Lightron”), a wholly-owned subsidiary of Griffon, once conducted lamp manufacturing and metal finishing operations at a location in the Town of Cortlandt, New York, just outside the city of Peekskill, New York (the “Peekskill Site”) which was owned by ISC Properties, Inc. (“ISCP”), a wholly-owned subsidiary of Griffon, for approximately three years . ISCP sold the Peekskill Site in November 1982. Based upon studies conducted by ISCP and the New York Department of Environmental Conservation, soils and groundwater beneath the Peekskill Site contain chlorinated solvents and metals. Stream sediments downgradient from the Peekskill Site also contain metals. On May 15, 2019 the United States Environmental Protection Agency ("EPA") added the Peekskill Site to the National Priorities List under CERCLA and has since reached agreement with Lightron and ISCP pursuant to which Lightron and ISCP will perform a Remedial Investigation/Feasibility Study (“RI/FS”). Performance of the RI/FS is expected to be completed in 2027. Lightron has not engaged in any operations in over three decades. ISCP functioned solely as a real estate holding company and has not held any real property in over three decades. Griffon does not acknowledge any responsibility to perform any investigation or remediation at the Peekskill Site. Lightron and ISCP are being defended by an insurance company, subject to a reservation of rights, and the insurance company is paying the costs of the RI, with Lightron and ISCP paying for the FS. 83 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non US currencies in thousands, except per share data) Memphis, TN site. Hunter Fan Company (“Hunter”) operated headquarters and a production plant in Memphis, TN for over 50 years (the “Memphis Site”). While Hunter completed certain on-site remediation of PCB-contaminated soils, Hunter did not investigate the extent to which PCBs existed beneath the building itself nor determine whether off-site areas had been impacted. Hunter vacated the site approximately twenty years ago, and the on-site buildings have now been demolished. The State of Tennessee Department of Environment and Conservation (“TDEC”) identified the Memphis site as being potentially contaminated, raising the possibility that site operations could have resulted in soil and groundwater contamination involving volatile organic compounds and metals. In 2021, the TDEC performed a preliminary assessment of the site and recommended to the EPA that it include the site on the National Priorities List established under CERCLA. The TDEC further recommended that the EPA fund an investigation of potential soil gas contamination in receptors near the site. The TDEC has also indicated that it will proceed with this investigation if the EPA does not act. Since 2021, there has been no further action by the EPA or TDEC relating to the Memphis site. It is unknown whether the EPA will add the Memphis Site to the National Priorities List, whether a site investigation will reveal contamination and, if there is contamination, the extent of any such contamination. However, given that certain PCB work was not completed in the past and the TDEC’s stated intent for the EPA to perform an investigation (and the statement by the TDEC that it will perform the investigation if the EPA will not), liability is probable in this matter. There are other potentially responsible parties for this site, including a former owner of Hunter; Hunter has notified such former owner of this matter. If the EPA decides to add this site to the National Priorities List, a Remedial Investigation/Feasibility Study (“RI/FS”) will be required. Hunter expects that the EPA will ask it to perform this work. If Hunter does not reach an agreement with the EPA to perform this work, the EPA will implement the RI/FS on its own. Should the EPA implement the RI/FS or perform further studies and/or subsequently remediate the site without first reaching an agreement with one or more relevant parties, the EPA would likely seek reimbursement from such parties, including Hunter, for the costs incurred. General legal Griffon is subject to various laws and regulations relating to the protection of the environment and is a party to legal proceedings arising in the ordinary course of business. Management believes, based on facts presently known to it, that the resolution of the matters above and such other matters will not have a material adverse effect on Griffon’s consolidated financial position, results of operations or cash flows. 84 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) NOTE 17 – EARNINGS PER SHARE Basic EPS was calculated by dividing income available to common shareholders by the weighted average number of shares of common stock outstanding during the period. Diluted EPS was calculated by dividing income available to common shareholders by the weighted average number of shares of common stock outstanding plus additional common shares that could be issued in connection with stock-based compensation. The following table is a reconciliation of the share amounts (in thousands) used in computing basic and diluted EPS for 2025, 2024 and 2023: 2025 2024 2023 Common shares outstanding 46,346 48,303 53,062 Unallocated ESOP shares — ( 18 ) ( 196 ) Non-vested restricted stock ( 1,593 ) ( 2,336 ) ( 3,111 ) Impact of weighted average shares 601 1,624 2,356 Weighted average shares outstanding - basic 45,354 47,573 52,111 Incremental shares from stock based compensation 1,331 2,095 2,501 Weighted average shares outstanding - diluted 46,685 49,668 54,612 Shares of the ESOP that have been allocated to employee accounts are treated as outstanding in determining earnings per share. NOTE 18 – RELATED PARTIES On February 20, 2024, Griffon entered into a stock purchase and cooperation agreement to repurchase, and repurchased, 1,500,000 shares of its common stock, par value $ 0.25 per share, beneficially owned by four separately managed accounts of which Voss Capital, LLC is the investment manager (the "Selling Shareholders"), in a private transaction. The purchase price per share was approximately $ 65.50 , for an aggregate purchase price of $ 98,250 . The Selling Shareholders are affiliates of Voss Capital, LLC. Travis W. Cocke, the Founder, Chief Investment Officer and Managing Member of Voss Capital, LLC, was formerly a member of the Board of Directors of the Company. Pursuant to the stock purchase and cooperation agreement, Mr. Cocke resigned as a member of the Board on February 20, 2024. On September 5, 2023 Griffon entered into a stock purchase agreement to repurchase 400,000 shares of its common stock, par value $ 0.25 per share, beneficially owned by two separately managed accounts of which Voss Capital, LLC is the investment manager (the “Selling Shareholders”), in a private transaction to facilitate redemptions by investors in the Selling Shareholders. The purchase price per share was approximately $ 41.87 , for an aggregate purchase price of $ 16,746 . The Selling Shareholders are affiliates of Voss Capital, LLC. Travis W. Cocke, the Founder, Chief Investment Officer and Managing Member of Voss Capital, LLC, was formerly a member of the Board of Directors of the Company. 85 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) NOTE 19 — REPORTABLE SEGMENTS Griffon conducts its operations through two reportable segments, as follows: • Home and Building Products ("HBP") conducts its operations through Clopay Corporation ("Clopay"). Founded in 1964, Clopay is the largest manufacturer and marketer of garage doors and rolling steel doors in North America. Residential and commercial sectional garage doors are sold through professional dealers and leading home center retail chains throughout North America under the brands Clopay, Ideal, and Holmes. Rolling steel door and grille products designed for commercial, industrial, institutional, and retail use are sold under the Clopay, Cornell and Cookson brands. • Consumer and Professional Products (“CPP”) is a global provider of branded consumer and professional tools; residential, industrial and commercial fans; home storage and organization products; and products that enhance indoor and outdoor lifestyles. CPP sells products globally through a portfolio of leading brands including AMES, since 1774, Hunter, since 1886, True Temper, and ClosetMaid. Information on Griffon’s reportable segments from continuing operations is as follows: For the Years Ended September 30, REVENUE 2025 2024 2023 Home and Building Products $ 1,584,182 $ 1,588,625 $ 1,588,505 Consumer and Professional Products 935,744 1,034,895 1,096,678 Total revenue $ 2,519,926 $ 2,623,520 $ 2,685,183 Griffon defines our reportable segments based on the way the Chief Operating Decision Maker ("CODM"), which is our Chief Executive Officer, manages the operations of the Company for purposes of allocating resources and assessing segment performance. The CODM evaluates performance and allocates resources based on segment adjusted EBITDA, a non-GAAP measure, defined as income before taxes, excluding interest income and expense, depreciation and amortization, strategic review charges, non-cash impairment charges, restructuring charges, gain/loss from debt extinguishment, and acquisition related expenses, as well as other items that may affect comparability, as applicable. Segment adjusted EBITDA also excludes unallocated amounts, mainly corporate overhead. Griffon believes this information is useful to its investors for the same reason. The following table provides a reconciliation of segment adjusted EBITDA to income before taxes: Home and Building Products Consumer and Professional Products For the Years Ended September 30, For the Years Ended September 30, 2025 2024 2023 2025 2024 2023 Revenue $ 1,584,182 $ 1,588,625 $ 1,588,505 $ 935,744 $ 1,034,895 $ 1,096,678 Adjusted costs of goods and services (1) ( 819,944 ) ( 819,784 ) ( 818,020 ) ( 641,977 ) ( 747,504 ) ( 836,314 ) Adjusted selling, general and administrative expenses (2) ( 287,237 ) ( 282,875 ) ( 274,163 ) ( 258,148 ) ( 262,571 ) ( 263,559 ) Depreciation and amortization 17,592 15,349 15,066 44,856 44,797 49,811 Other segment items (3) ( 17 ) ( 314 ) ( 512 ) 5,070 3,015 3,727 Segment Adjusted EBITDA (4) $ 494,576 $ 501,001 $ 510,876 $ 85,545 $ 72,632 $ 50,343 86 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) For the Years Ended September 30, 2025 2024 2023 Segment Adjusted EBITDA: Home and Building Products $ 494,576 $ 501,001 $ 510,876 Consumer and Professional Products 85,545 72,632 50,343 Segment Adjusted EBITDA 580,121 573,633 561,219 Unallocated amounts, excluding depreciation (5) ( 57,828 ) ( 60,031 ) ( 55,887 ) Net interest expense ( 93,857 ) ( 101,652 ) ( 99,351 ) Depreciation and amortization ( 63,014 ) ( 60,704 ) ( 65,445 ) Goodwill and intangible asset impairments ( 243,612 ) — ( 109,200 ) Impact of retirement plan events 1,165 — — Gain (loss) on sale of real estate 8,279 ( 61 ) 12,655 Strategic review - retention and other ( 3,883 ) ( 10,594 ) ( 20,225 ) Restructuring charges — ( 41,309 ) ( 92,468 ) Debt extinguishment, net — ( 1,700 ) ( 437 ) Acquisition costs — ( 441 ) — Fair value step-up of acquired inventory sold — ( 491 ) — Special dividend ESOP charges — — ( 15,494 ) Proxy expenses — — ( 2,685 ) Income before taxes $ 127,371 $ 296,650 $ 112,682 __________________________________ (1) Adjusted costs of goods and services excludes restructuring and other costs and acquisition related expenses, and includes depreciation and amortization. (2) Adjusted selling, general and administrative expenses excludes strategic review - retention and other expenses, special dividend ESOP charges, restructuring and other costs, and goodwill and intangible asset impairments, and includes depreciation and amortization. (3) The Other segment items category includes rental income, foreign exchange gains/losses and other miscellaneous expenses. (4) Segment Adjusted EBITDA includes other income and excludes depreciation, amortization and normalized items. (5) Unallocated amounts mainly consists of corporate overhead costs maintained at the corporate level, which is not allocated to the business segments. These expenses include equity-based compensation costs, expenses relating to treasury, accounting, consulting, advisory, legal, tax and audit, insurance, financial reporting services and various administrative expenses related to the corporate headquarters. For the Years Ended September 30, DEPRECIATION and AMORTIZATION 2025 2024 2023 Segment: Home and Building Products $ 17,592 $ 15,349 $ 15,066 Consumer and Professional Products 44,856 44,797 49,811 Total segment depreciation and amortization 62,448 60,146 64,877 Corporate 566 558 568 Total consolidated depreciation and amortization $ 63,014 $ 60,704 $ 65,445 CAPITAL EXPENDITURES Segment: Home and Building Products (1) $ 30,200 $ 41,765 $ 24,065 Consumer and Professional Products (2) (3) 17,385 26,330 39,476 Total segment 47,585 68,095 63,541 Corporate (4) 4,850 304 63 Total consolidated capital expenditures $ 52,435 $ 68,399 $ 63,604 (1) During the year ended September 30, 2023, HBP's capital expenditures included approximately $ 6,000 in connection with the purchase of HBP's Mason headquarters. 87 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) (2) During the year ended September 30, 2023, CPP's capital expenditures included approximately $ 23,207 in connection with the purchase of CPP's Ocala, Florida manufacturing facility. (3) During the years ended September 30, 2025, 2024 and 2023, CPP capital expenditures excludes proceeds from the sale of real estate and equipment of approximately $ 17,729 , $ 13,271 and $ 8,900 , respectively. (4) During the year ended September 30, 2023, Corporate's capital expenditures exclude proceeds from the sale of real estate of approximately $ 11,800 . ASSETS At September 30, 2025 At September 30, 2024 Segment assets: Home and Building Products $ 770,072 $ 737,992 Consumer and Professional Products (1) 1,164,957 1,495,489 Total segment assets 1,935,029 2,233,481 Corporate 122,607 133,408 Total continuing assets 2,057,636 2,366,889 Other discontinued operations 6,001 4,065 Consolidated total $ 2,063,637 $ 2,370,954 __________________________ (1) In connection with the expansion of CPP's global sourcing strategy, certain owned manufacturing locations which concluded operations have met the criteria to be classified as held for sale as of September 30, 2025. The aggregate net book value of these properties as of September 30, 2025 totaled $ 5,609 . The Company’s long-lived assets are concentrated primarily in the United States, which accounted for approximately 84 % and 85 % of the Company’s total long-lived assets as of September 30, 2025 and 2024, respectively. No foreign country accounted for more than 10% of the Company’s total long-lived assets as of September 30, 2025 and 2024. Disaggregation of Revenue Revenue from contracts with customers is disaggregated by end markets, segments and geographic location, as it more accurately depicts the nature and amount of the Company’s revenue. For the Years Ended September 30, 2025 2024 2023 Residential repair and remodel (1) $ 771,585 $ 769,691 $ 757,088 Commercial 676,626 684,388 700,112 Residential new construction (1) 135,971 134,546 131,305 Total Home and Building Products 1,584,182 1,588,625 1,588,505 Residential repair and remodel $ 289,091 $ 352,797 $ 377,775 Retail 170,838 234,591 267,046 Residential new construction 55,367 57,537 51,093 Industrial 72,352 67,738 78,308 International excluding North America 348,096 322,232 322,456 Total Consumer and Professional Products 935,744 1,034,895 1,096,678 Total Revenue $ 2,519,926 $ 2,623,520 $ 2,685,183 _____________________________________ (1) The breakout between residential new construction and residential repair and remodel contains certain management assumptions, such as customer and product type. 88 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) The following table presents revenue disaggregated by geography based on the location of the Company's customer: For the Year Ended September 30, 2025 Revenue by Geographic Area - Destination Home and Building Products Consumer and Professional Products Total United States $ 1,523,828 $ 516,273 $ 2,040,101 Europe — 41,768 41,768 Canada 49,458 62,573 112,031 Australia — 289,018 289,018 All other countries 10,896 26,112 37,008 Total Revenue $ 1,584,182 $ 935,744 $ 2,519,926 For the Year Ended September 30, 2024 Revenue by Geographic Area - Destination Home and Building Products Consumer and Professional Products Total United States $ 1,519,063 $ 638,782 $ 2,157,845 Europe 112 52,933 53,045 Canada 60,995 67,375 128,370 Australia — 251,778 251,778 All other countries 8,455 24,027 32,482 Total Revenue $ 1,588,625 $ 1,034,895 $ 2,623,520 For the Year Ended September 30, 2023 Revenue by Geographic Area - Destination Home and Building Products Consumer and Professional Products Total United States $ 1,515,479 $ 716,098 $ 2,231,577 Europe 18 51,041 51,059 Canada 62,897 75,477 138,374 Australia — 231,764 231,764 All other countries 10,111 22,298 32,409 Total Revenue $ 1,588,505 $ 1,096,678 $ 2,685,183 As a percentage of segment revenue, HBP sales to The Home Depot approximated 9 %, 8 % and 9 % in 2025, 2024 and 2023, respectively; CPP sales to The Home Depot approximated 12 %, 15 % and 15 % in 2025, 2024 and 2023, respectively. As a percentage of Griffon's consolidated revenue, sales to The Home Depot approximated 10 %, 11 % and 12 % in 2025, 2024 and 2023, respectively. 89 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) NOTE 20 – OTHER INCOME (EXPENSE) For the years ended September 30, 2025, 2024 and 2023, Other income (expense) of $ 6,672 , $ 1,766 and $ 2,928 , respectively, includes $ 474 , ($ 333 ) and $ 302 , respectively, of net currency exchange transaction gains (losses) from receivables and payables held in non-functional currencies, ($ 948 ), $ 148 and $ 469 , respectively, of net gains (losses) on investments, and $ 5,411 , ($ 137 ) and ($ 866 ), respectively, of net periodic benefit plan income (expense) For the year ended September 30, 2025, net periodic benefit plan income (expense) of $ 5,411 includes a gain of $ 4,621 associated with the termination of the Hunter Fan Pension Plan and a charge of $ 951 related to the establishment of a new retiree medical plan. Other income (expense) also includes royalty income of $ 2,201 , $ 2,198 and $ 2,104 for the years ended September 30, 2025, 2024 and 2023, respectively. NOTE 21 - OTHER COMPREHENSIVE INCOME (LOSS) The amounts recognized in other comprehensive income (loss) were as follows: Years Ended September 30, 2025 2024 2023 Pre-tax Tax Net of tax Pre-tax Tax Net of tax Pre-tax Tax Net of tax Foreign currency translation adjustments $ ( 6,569 ) $ — $ ( 6,569 ) $ 10,137 $ — $ 10,137 $ 8,447 $ — $ 8,447 Pension and other defined benefit plans ( 10,584 ) 2,223 ( 8,361 ) 1,947 ( 409 ) 1,538 8,418 ( 1,784 ) 6,634 Cash flow hedge 1,477 ( 443 ) 1,034 444 ( 133 ) 311 ( 3,363 ) 1,010 ( 2,353 ) Total other comprehensive income (loss) $ ( 15,676 ) $ 1,780 $ ( 13,896 ) $ 12,528 $ ( 542 ) $ 11,986 $ 13,502 $ ( 774 ) $ 12,728 The components of Accumulated other comprehensive income (loss) are as follows: At September 30, 2025 2024 Foreign currency translation $ ( 45,155 ) $ ( 38,586 ) Pension and other defined benefit plans ( 27,488 ) ( 19,127 ) Cash flow hedge 723 ( 311 ) Total $ ( 71,920 ) $ ( 58,024 ) Total comprehensive income (loss) were as follows: For the Years Ended September 30, 2025 2024 2023 Net income $ 51,110 $ 209,897 $ 77,617 Other comprehensive income (loss), net of taxes ( 13,896 ) 11,986 12,728 Comprehensive income (loss) $ 37,214 $ 221,883 $ 90,345 90 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) Amounts reclassified from accumulated other comprehensive income (loss) to income (loss) were as follows: For the Years Ended September 30, Gain (Loss) 2025 2024 2023 Pension amortization $ ( 2,704 ) $ ( 2,755 ) $ ( 3,777 ) Cash flow hedges 1,945 ( 816 ) 1,678 Total before tax ( 759 ) ( 3,571 ) ( 2,099 ) Tax 159 750 441 Net of tax $ ( 600 ) $ ( 2,821 ) $ ( 1,658 ) NOTE 22 — LEASES The Company recognizes right-of-use ("ROU") assets and lease liabilities on the balance sheet, with the exception of leases with a term of twelve months or less. The Company determines if an arrangement is a lease at inception. The ROU assets and short and long-term liabilities associated with our Operating leases are shown as separate line items on our Consolidated Balance Sheets. Finance leases are included in property, plant, and equipment, net, accrued liabilities, and other liabilities on our Consolidated Balance Sheets. The Company's finance leases are immaterial. ROU assets, along with any other related long-lived assets, are periodically evaluated for impairment. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. Lease payments primarily include rent and insurance costs (lease components). The Company's leases also include non-lease components such as real estate taxes and common-area maintenance costs. The Company elected the practical expedient to account for lease and non-lease components as a single component. In certain of the Company's leases, the non-lease components are variable and in accordance with the standard are therefore excluded from lease payments to determine the ROU asset. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. We use the implicit rate when readily determinable. Our determination of the lease term may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. For operating leases, fixed lease payments are recognized as operating lease cost on a straight-line basis over the lease term. For finance leases and impaired operating leases, the ROU asset is depreciated on a straight-line basis over the remaining lease term, along with recognition of interest expense associated with accretion of the lease liability. For leases with a lease term of 12 months or less (a "Short-term" lease), any fixed lease payments are recognized on a straight-line basis over such term, and are not recognized on the Consolidated Balance Sheets. Variable lease cost for both operating and finance leases, if any, is recognized as incurred. Components of operating lease costs are as follows: For the Year Ended September 30, 2025 2024 2023 Fixed $ 46,995 $ 46,575 $ 45,993 Variable (a), (b) 10,580 9,772 10,654 Short-term (b) 5,163 4,997 7,717 Total $ 62,738 $ 61,344 $ 64,364 (a) Primarily related to common-area maintenance and property taxes. (b) Not recorded on the balance sheet. 91 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) Supplemental cash flow information were as follows: For the Year Ended September 30, 2025 2024 2023 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 43,496 $ 45,439 $ 41,533 Financing cash flows from finance leases 154 291 2,164 Total $ 43,650 $ 45,730 $ 43,697 Supplemental Consolidated Balance Sheet information related to leases were as follows: As of September 30, 2025 2024 Operating Leases: Right of use assets: Operating right-of-use assets $ 167,829 $ 171,211 Lease Liabilities: Current portion of operating lease liabilities $ 32,307 $ 35,065 Long-term operating lease liabilities 147,203 147,369 Total operating lease liabilities $ 179,510 $ 182,434 Finance Leases: Right of use assets: Property, plant and equipment, net (1) $ 430 $ 808 Lease Liabilities: Notes payable and current portion of long-term debt $ 102 $ 155 Long-term debt, net 149 255 Total financing lease liabilities $ 251 $ 410 (1) For the years ended September 30, 2025 and 2024, finance lease assets are recorded net of accumulated depreciation of $ 1,399 and $ 1,463 , respectively. On September 28, 2023, the Company closed on the exercise of its lease purchase option, as permitted under the lease agreement, to acquire ownership of the manufacturing facility located in Ocala, Florida for a cash purchase price of $ 23,207 . The Ocala lease had a maturity date in 2025 and bore interest at a fixed rate of approximately 5.6 %. As a result of exercising the purchase option, the Company no longer has any future lease obligations related to this real estate. The remaining lease liability balance relates to finance equipment leases. 92 GRIFFON CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (US dollars and non-US currencies in thousands, except per share data) The aggregate future maturities of lease payments for operating leases and finance leases as of September 30, 2025 are as follows (in thousands): Operating Leases Finance Leases 2026 $ 41,883 $ 116 2027 38,045 54 2028 32,428 49 2029 27,195 50 2030 19,593 12 Thereafter 60,825 — Total lease payments 219,969 281 Less: imputed interest ( 40,459 ) ( 30 ) Present value of lease liabilities $ 179,510 $ 251 Average lease terms and discount rates were as follows: As of September 30, 2025 2024 Weighted-average remaining lease term (years) Operating Leases 6.6 7.1 Finance Leases 3.6 4.2 Weighted-average discount rate Operating Leases 6.19 % 6.33 % Finance Leases 6.76 % 6.70 % 93 SCHEDULE II GRIFFON CORPORATION VALUATION AND QUALIFYING ACCOUNTS For the Years Ended September 30, 2025, 2024 and 2023 (in thousands) Description Balance at Beginning of Year Additions Reductions Other Balance at End of Year FOR THE YEAR ENDED SEPTEMBER 30, 2025 Allowance for credit losses $ 10,986 $ 566 $ ( 1,755 ) $ 289 $ 10,086 Inventory valuation $ 56,285 $ 1,697 $ ( 18,701 ) $ 386 $ 39,667 Deferred tax valuation allowance $ 26,989 $ 3,714 $ — $ — $ 30,703 FOR THE YEAR ENDED SEPTEMBER 30, 2024 Allowance for credit losses $ 11,264 $ 636 $ ( 1,325 ) $ 411 $ 10,986 Inventory valuation (1) $ 55,737 $ 27,210 $ ( 27,353 ) $ 691 $ 56,285 Deferred tax valuation allowance $ 17,992 $ 8,997 $ — $ — $ 26,989 FOR THE YEAR ENDED SEPTEMBER 30, 2023 Allowance for credit losses $ 12,137 $ 971 $ ( 1,186 ) $ ( 658 ) $ 11,264 Inventory valuation (1) $ 22,875 $ 44,570 $ ( 11,692 ) $ ( 16 ) $ 55,737 Deferred tax valuation allowance $ 13,490 $ 4,502 $ — $ — $ 17,992 ___________________________________________ (1) In connection with the Company's restructuring activities described in Note 10 - Restructuring Charges, during the years ended September 30, 2024 and 2023, CPP recorded inventory impairment charges of $ 23,763 and $ 37,100 , respectively, to adjust inventory to its net realizable value. 94 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure Not applicable.