What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2025-02-14 compared with 2024-02-21 · 483 added, 438 removed, 1086 unchanged (46% of the section changed)

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In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024 in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company did not maintain, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO because material weaknesses in internal control over financial reporting existed as of that date related to ineffective controls over the reviews of significant assumptions used in the impairment assessments of goodwill, indefinite-lived tradenames, and long-lived assets.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis.

The material weaknesses referred to above are described in Management’s Annual Report on Internal Control Over Financial Reporting appearing under Item 9A.

We considered these material weaknesses in determining the nature, timing, and extent of audit tests applied in our audit of the 2023 consolidated financial statements, and our opinion regarding the effectiveness of the Company’s internal control over financial reporting does not affect our opinion on those consolidated financial statements.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the 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 management's report referred to above.

Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company’s internal control over financial reporting based on our audits.

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The communication of critical audit matters does not alter in any way our opinion on the consolidated 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.

Interim and Annual Impairment Assessments - Goodwill and Certain Indefinite-Lived Tradenames

As described in Notes 1 and 7 to the consolidated financial statements, the Company’s goodwill and indefinite-lived tradenames balances were $3.1 billion and $1.5 billion, respectively, as of December 31, 2023.

Impairment Assessments –Baby and Commercial Reporting Units Goodwill and Certain Indefinite-Lived Tradenames

As described in Notes 1 and 7 to the consolidated financial statements, the Company’s consolidated goodwill and indefinite-lived tradenames balances were $3.0 billion and $844 million, respectively, as of December 31, 2024.

The goodwill associated with the Commercial and Baby reporting units was $747 million and $415 million, respectively;

and certain indefinite-lived tradenames were $725 million.

Goodwill and indefinite-lived tradenames are tested and reviewed for impairment annually on December 1, or more frequently if facts and circumstances warrant.

In 2023, management used a quantitative approach, which involves comparing the fair value to the carrying values.

For goodwill, if the carrying value of a reporting unit exceeds its fair value, an impairment loss is calculated as the difference between these amounts, limited to the amount of goodwill allocated to the reporting unit.

An indefinite-lived tradename is impaired by the amount its carrying value exceeds its estimated fair value.

During the year, the Company recorded non-cash impairment charges of $241 million to goodwill for the Baby reporting unit and $98 million to certain indefinite-lived tradenames, respectively.

Fair value is estimated by management using the discounted cash flow method for its reporting units.

Fair value is estimated by management using an income method, either the relief from royalty method or the excess earnings method, for indefinite-lived tradenames.

Management’s impairment assessments require significant use of judgment and assumptions such as (i) the estimation of future cash flows, business growth rates, and discount rates for reporting units, (ii) the cash flow projections, royalty rates, and discount rates under the relief from royalty method for certain indefinite-lived tradenames, and (iii) the cash flow projections, and discount rates under the excess earnings method for certain indefinite-lived tradenames.

The principal considerations for our determination that performing procedures relating to the interim and annual impairment assessments of goodwill and certain indefinite-lived tradenames is a critical audit matter are (i) the significant judgment by management when developing the fair value estimates of the reporting units and indefinite-lived tradenames;

(ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to (a) the estimation of future cash flows, business growth rates, and discount rates for reporting units, (b) the cash flow projections, royalty rates, and discount rates under the relief from royalty method for certain indefinite-lived tradenames, and (c) the cash flow projections and discount rates under the excess earnings method for certain indefinite-lived tradenames;

Management performed quantitative assessments for the Baby and Commercial reporting units and certain indefinite-lived tradenames.

In performing the quantitative assessments, management estimated the fair value of each reporting unit using the income approach, specifically the discounted cash flow method.

Management also performed quantitative assessments for certain indefinite-lived tradenames, where fair value was determined using the relief from royalty or the excess earnings method depending on the individual tradename.

Management’s impairment assessments require significant use of judgment and assumptions such as (i) the identification of reporting units, assignment of assets and liabilities to reporting units, and the estimation of future cash flows, business growth rates, terminal values, discount rates, and total enterprise value for reporting units, (ii) the cash flow projections, royalty rate, terminal value and discount rate under the relief from royalty method for a certain indefinite-lived tradename, and (iii) the cash flow projections and discount rates under the excess earnings method for certain indefinite-lived tradenames.

As a result of the assessments, no impairment charges were recorded related to goodwill for the Baby and Commercial reporting units, and non-cash impairment charges of $345 million were recorded for certain indefinite-lived tradenames.

The principal considerations for our determination that performing procedures relating to the impairment assessments of goodwill for the Commercial and Baby reporting units and for certain indefinite-lived tradenames is a critical audit matter are (i) the significant judgment by management when developing the fair value estimates of the Commercial and Baby reporting units and certain indefinite-lived tradenames;

(ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to (a) the estimation of future cash flows, business growth rates, and discount rates for the Commercial and Baby reporting units, (b) the cash flow projections, royalty rate, and discount rate under the relief from royalty method for a certain indefinite-lived tradename, and (c) the cash flow projections and discount rates under the excess earnings method for certain indefinite-lived tradenames;

and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

As described in the “Opinions on the Financial Statements and Internal Control over Financial Reporting” section, material weaknesses were identified related to this matter.

As disclosed by management, material weaknesses existed during the year related to this matter.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to management’s impairment assessments of goodwill and indefinite-lived tradenames, including controls over the valuation of the Company’s reporting units and certain indefinite-lived tradenames.

These procedures also included, among others, (i) evaluating and determining the nature and extent of audit procedures performed and evidence obtained that are responsive to the material weaknesses identified, (ii) testing management’s process for developing the fair value estimates of the reporting units and certain indefinite-lived tradenames;

(iii) evaluating the appropriateness of the discounted cash flow method, relief from royalty method, and excess earnings methods used by management;

(iv) testing the completeness and accuracy of underlying data used in the valuation

and (v) evaluating the reasonableness of the significant assumptions used by management related to the (a) estimation of future cash flows, business growth rates, and discount rates for reporting units, (b) the cash flow projections, royalty rates, and discount rates under the relief from royalty method for certain indefinite-lived tradenames, and (c) the cash flow projections and discount rates under the excess earnings method for certain indefinite-lived tradenames.

Evaluating management’s assumptions related to the estimation of future cash flows and business growth rates for reporting units and the cash flow projections for certain indefinite-lived tradenames involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the reporting units and indefinite-lived tradenames;

These procedures included testing the effectiveness of controls relating to management’s impairment assessments of goodwill and indefinite-lived tradenames, including controls over the valuation of the Company’s Commercial and Baby reporting units and certain indefinite-lived tradenames.

These procedures also included, among others, (i) evaluating and determining the nature and extent of audit procedures performed and evidence obtained that are responsive to the material weaknesses which existed during the year, (ii) testing management’s process for developing the fair value estimates of the Commercial and Baby reporting units and certain indefinite-lived tradenames;

(iii) evaluating the appropriateness of the discounted cash flow, relief from royalty, and excess earnings methods used by management;

(iv) testing the completeness and accuracy of underlying data used in the valuation methods;

and (v) evaluating the reasonableness of the significant assumptions used by management related to the (a) estimation of future cash flows, business growth rates, and discount rates for the Commercial and Baby reporting units, (b) cash flow projections, royalty rate, and discount rate under the relief from royalty method for a certain indefinite-lived tradename, and (c) cash flow projections and discount rates under the excess earnings method for certain indefinite-lived tradenames.

Evaluating management’s assumptions related to the estimation of future cash flows and business growth rates for the Commercial and Baby reporting units and the cash flow projections for certain indefinite-lived tradenames involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the Commercial and Baby reporting units and indefinite-lived tradenames;

(ii) the consistency with external and industry data;

and (iii) whether the assumptions were consistent with evidence obtained in other areas of the audit.

Professionals with specialized skill and knowledge were used to assist in evaluating (i) the appropriateness of the discounted cash flow method, relief from royalty method, and excess earnings method and (ii) the reasonableness of the discount rate assumption for reporting units, and the discount rate and royalty rate assumptions for certain indefinite-lived tradenames.

Professionals with specialized skill and knowledge were used to assist in evaluating (i) the appropriateness of the valuation methods and (ii) the reasonableness of the discount rate assumption for the Commercial and Baby reporting units, and the discount rate and royalty rate assumptions for certain indefinite-lived tradenames.

/s/ PricewaterhouseCoopers LLP

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Interest expense, net 295 283 235

Loss on extinguishment of debt — 1 5

Loss on extinguishment and modification of debt 14 — 1

Other (income) expense, net 18 175 ( 81 )

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Total other comprehensive income (loss), net of tax ( 91 ) 121 ( 129 )

Comprehensive income (loss) ( 267 ) 68 620

Total comprehensive income attributable to noncontrolling interests — — 2

Total comprehensive income (loss) attributable to parent $ ( 267 ) $ 68 $ 618

Total comprehensive income (loss) $ ( 307 ) $ ( 267 ) $ 68

See Notes to Consolidated Financial Statements.

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Accounts payable $ 891 $ 1,003

Accrued compensation 190 123

Other accrued liabilities 1,459 1,565

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Impairment of goodwill, intangibles and other assets 353 342 474

Gain from sale of businesses ( 1 ) ( 136 ) ( 4 )

(Gain) loss from sale of businesses and investments 2 ( 1 ) ( 136 )

Deferred income taxes ( 114 ) ( 283 ) 97

Stock based compensation expense 74 50 12

Pension settlement charge 126 — —

Loss on extinguishment of debt — 1 5

Pension settlement ( 1 ) 126 —

Loss on extinguishment and modification of debt 14 — 1

Other, net ( 18 ) ( 33 ) ( 24 )

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Accounts payable ( 96 ) ( 50 ) ( 536 )

Accrued liabilities and other 93 ( 507 ) 14

Accrued liabilities and other, net ( 136 ) 93 ( 507 )

Net cash provided by (used in) operating activities 496 930 ( 272 )

Cash flows from investing activities:

Proceeds from sale of divested businesses 11 617 —

Capital expenditures ( 259 ) ( 284 ) ( 312 )

Proceeds from sale of divested businesses and investments 14 11 617

Proceeds from settlement of swaps 60 43 25

Other investing activities 31 13 6

Other investing activities, net 34 31 13

Net cash provided by (used in) investing activities ( 151 ) ( 199 ) 343

Cash flows from financing activities:

Short-term debt, net ( 488 ) 619 —

Net proceeds from issuance of long-term debt — 989 —

Proceeds from (payments on) short-term debt, net ( 91 ) ( 488 ) 619

Payments on current portion of long-term debt ( 701 ) ( 2 ) ( 1,091 )

Proceeds from short-term debt with original maturities greater than 90 days 431 — —

Payments on short-term debt with original maturities greater than 90 days ( 431 ) — —

Net proceeds from issuance of long-term debt 1,237 — 989

Payments on long-term debt ( 750 ) — —

Debt extinguishment and modification costs ( 14 ) ( 1 ) —

Repurchase of shares of common stock — — ( 325 )

Cash dividends ( 118 ) ( 184 ) ( 385 )

Acquisition of noncontrolling interests — — ( 28 )

Equity compensation activity and other, net ( 14 ) 11 ( 39 )

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Cash paid for income taxes, net of refunds 173 103 172

Cash paid for interests 298 244 271

Cash paid for interest 319 298 244

See Notes to Consolidated Financial Statements.

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Stock Additional Paid-In Capital Retained Earnings

(Deficit) Accumulated Other Comprehensive Income (Loss) Total Stockholders' Equity Attributable to Parent Non-

controlling Interests Total Stockholders' Equity

(Deficit) Accumulated Other Comprehensive Income (Loss) Total Stockholders’ Equity

Balance at December 31, 2021 $ 450 $ ( 609 ) $ 7,734 $ ( 2,535 ) $ ( 882 ) $ 4,158

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Equity compensation, net of tax 2 ( 14 ) 11 — — ( 1 )

Portion of net income attributable to noncontrolling interests — — — — — — 2 2

Acquisition of noncontrolling interests — — — — — — ( 28 ) ( 28 )

Common stock purchased and retired ( 13 ) — ( 312 ) — — ( 325 )

Other — — ( 1 ) — — ( 1 )

Balance at December 31, 2022 $ 439 $ ( 623 ) $ 7,052 $ ( 2,338 ) $ ( 1,011 ) $ 3,519

3 unchanged sentences

Equity compensation, net of tax 1 ( 4 ) 48 — — 45

Common stock purchased and retired ( 13 ) — ( 312 ) — — ( 325 ) — ( 325 )

Other — — ( 1 ) — — ( 1 ) — ( 1 )

Balance at December 31, 2023 $ 440 $ ( 627 ) $ 6,915 $ ( 2,726 ) $ ( 890 ) $ 3,112

Comprehensive income (loss) — — — ( 388 ) 121 ( 267 ) — ( 267 )

Comprehensive loss — — — ( 216 ) ( 91 ) ( 307 )

Dividends declared on common stock - $ 0.28 per share

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The Company sells its products in over 150 countries around the world and has operations on the ground in over 40 of these countries, excluding third-party distributors.

The Company has three operating segments:

Home and Commercial Solutions (“H&CS”), Learning and Development (“L&D”) and Outdoor and Recreation (“O&R”).

Basis of Presentation

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Certain prior year amounts have been reclassified to conform to the current year presentation.

Effective January 1, 2023, as a result of the implementation of a new operating model intended to drive further simplification and unlock additional efficiencies and synergies within the Company, the chief operating decision maker (the “CODM”) now reviews the businesses as three operating segments:

Home and Commercial Solutions, Learning and Development and Outdoor and Recreation.

The Home and Commercial Solutions operating segment represents the combination of the previously reported Commercial Solutions, Home Appliances and Home Solutions operating segments.

Prior period comparable results have been reclassified to conform to the operating segment change.

See Footnote 17 for more information.

On March 31, 2022, the Company sold its Connected Home and Security (“CH&S”) business to Resideo Technologies, Inc.

The results of operations for CH&S continued to be reported in the Consolidated Statement of Operations as part of the Home and Commercial Solutions segment through March 31, 2022.

See Footnotes 2 and 17 for more information.

Use of Estimates and Risks

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GAAP in preparing the Company’s consolidated financial statements requires the pervasive use of estimates and assumptions.

The Company continues to be impacted by inflationary pressures, soft global demand, focus by major retailers on the rebalancing of inventory levels, rising interest rates and indirect macroeconomic impacts from geopolitical conflicts.

These collective macroeconomic trends, the duration or severity of which are highly uncertain, are rapidly changing the retail and consumer landscape and negatively impact the Company’s operating results, cash flows and financial condition in 2023 and are expected to persist into 2024.

As consumers continue to face widespread increases in prices and interest rates, their discretionary spending and purchase patterns may continue to be unfavorably impacted.

The Company continues to be impacted by inflationary pressures, soft global demand, major retailers’ focus on tight control over their inventory levels, fluctuating interest rates and indirect macroeconomic impacts from geopolitical conflicts.

These collective macroeconomic trends, the duration or severity of which are highly uncertain, are still changing the retail and consumer landscape, negatively impacted the Company’s operating results, cash flows and financial condition in 2024, and are to some degree expected to persist into 2025.

As consumers continue to face widespread increases in prices and fluctuating interest rates, their discretionary spending and purchase patterns may continue to be unfavorably impacted.

The high level of uncertainty of these factors has resulted in estimates and assumptions that have the potential for more variability and are more subjective.

In addition, some of the other inherent estimates and assumptions used in the Company’s forecasted results of operations and cash flows that form the basis of the determination of the fair value of the reporting units for goodwill and indefinite-lived intangible asset impairment testing are outside the control of management, including interest rates, cost of capital, tax rates, industry growth, credit ratings, foreign exchange rates and labor inflation.

In addition, some of the other inherent estimates and assumptions used in the Company’s forecasted results of operations and cash flows that form the basis of the determination of the fair value of the reporting units for goodwill and indefinite-lived intangible asset impairment testing are outside the control of management, including interest rates, cost of capital, tax rates, tariffs, industry growth, credit ratings, foreign exchange rates and labor inflation.

Although management has made its best estimates and assumptions based upon current information, actual results could materially differ given the uncertainty of these factors and may require future changes to such estimates and assumptions, including reserves, which may result in future expense or impairment charges.

During the fourth quarter of 2023, in conjunction with the Company’s annual impairment testing, the Company recorded a non-cash impairment charge of $ 68 million related to two tradenames in the Home and Commercial Solutions segment as the carrying values exceeded the fair values.

A quantitative impairment test was also performed for the Company’s long-lived assets resulting in no impairment.

During the third quarter of 2023, the Company concluded that a triggering event had occurred for the goodwill associated with the Baby reporting unit in the Learning and Development segment, as a result of a downward revision of forecasted cash flows due to lower volume and profitability expectations, as well as rising interest rates, and for an indefinite-lived tradename in the Outdoor and Recreation segment, as a result of a downward revision of forecasted cash flows due to market conditions, as well as rising interest rates.

The Company performed a quantitative impairment test and determined that the Baby reporting unit goodwill and the indefinite-lived tradename in the Outdoor and Recreation segment were impaired.

During the third quarter of 2023, the Company recorded a non-cash impairment charge of $ 241 million for the Baby reporting unit goodwill and $ 22 million for the indefinite-lived tradename in the Outdoor and Recreation segment, as the carrying values exceeded their fair values.

During the second quarter of 2023, the Company concluded that a triggering event had occurred for an indefinite-lived tradename in the Home Fragrance reporting unit in the Home and Commercial Solutions segment and for the goodwill associated with the Baby reporting unit in the Learning and Development segment, as a result of a downward revision of forecasted cash flows due to softening global demand, primarily caused by continued inflationary pressure that is impacting discretionary spending behavior of consumers, as well as rising interest rates.

The Company performed a quantitative impairment test and determined that the indefinite-lived tradename in the Home and Commercial Solutions segment was impaired.

During the second quarter of 2023, the Company recorded a non-cash impairment charge of $ 8 million, as the carrying value of the tradename exceeded its fair value.

The Company concluded that the Baby reporting unit goodwill was not impaired during the second quarter of 2023.

During the fourth quarter of 2024, in conjunction with the Company’s annual impairment testing, the Company recorded a non-cash impairment charge of $ 85 million related to one tradename in the H&CS segment as the carrying value exceeded the fair value.

The decline in the fair value of the tradename in the H&CS segment was the result of downward revision of forecasted revenue mainly due to a distribution loss, which the Company was informed of during the fourth quarter of 2024.

An impairment test was also performed for the Company’s goodwill resulting in no impairment.

During the third quarter of 2024, the Company concluded that triggering events had occurred for indefinite-lived tradenames in the H&CS and L&D segments, as a result of downward revisions of forecasted cash flows primarily due to lower volume and profitability expectations.

The Company performed quantitative impairment tests and determined that indefinite-lived tradenames in the H&CS and L&D segments were partially impaired.

During the third quarter of 2024, the Company recorded an aggregate non-cash impairment charge of $ 260 million for the indefinite-lived tradenames, as the carrying values exceeded their fair values.

See Footnote 7 for further information.

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The Company elected to account for shipping and handling activities as a fulfillment cost.

The Company also elected not to disclose the value of unsatisfied performance obligations for (i) contracts with

an original expected length of one year or less and (ii) contracts for which revenue is recognized at the amount to which the Company has the right to invoice for services performed.

The Company also elected not to disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which revenue is recognized at the amount to which the Company has the right to invoice for services performed.

Goodwill and Indefinite-Lived Intangibles

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Goodwill is tested for impairment at a reporting unit level, and all of the Company’s goodwill is assigned to its reporting units.

Reporting units are determined based upon the Company’s organizational structure in place at the date of the goodwill impairment testing and generally one level below the operating segment level.

Reporting units are determined based upon the Company’s organizational structure in place at the date of the goodwill impairment testing and generally are one level below the operating segment level.

The Company’s operations are comprised of six reporting units, within its three primary operating segments.

The Company may use a qualitative approach, and when appropriate, has bypassed the qualitative and used a quantitative approach, which involves comparing the fair value of each of the reporting units to the carrying value of those reporting units.

If the carrying value of a reporting unit exceeds its fair value, an impairment loss would be calculated as the difference between these amounts, limited to the amount of reporting unit goodwill allocated to the reporting unit.

The quantitative goodwill impairment testing requires significant use of judgment and assumptions, such as the identification of reporting units;

the assignment of assets and liabilities to reporting units;

and the estimation of future cash flows, business growth rates, terminal values, discount rates and total enterprise value.

The income approach used is the discounted cash flow methodology and is based on five-year cash flow projections.

The Company has the option of first analyzing qualitative factors to determine whether it is more likely than not that the fair value of any reporting unit is less than its carrying amount.

However, the Company may elect to perform a quantitative goodwill impairment test in lieu of the qualitative test.

When a qualitative goodwill test is performed, the Company analyzes factors to determine whether it is more likely than not that the fair value of a reporting unit is less than the carrying amount as a basis for determining whether it is necessary to perform the quantitative goodwill impairment test.

The evaluation of qualitative factors includes an assessment of relevant facts, events, and circumstances including but not limited to:

macroeconomic conditions, industry and market conditions, and the current and forecasted financial performance of the reporting unit.

If the qualitative test indicates it is more likely than not that the fair value of a reporting unit is less than the carrying amount the Company performs the quantitative test, which measures the amount of the goodwill impairment, if any.

In performing a quantitative assessment, the Company estimates the fair value of each reporting unit by using the income approach.

The quantitative goodwill impairment test requires significant use of judgment and assumptions, such as the identification of reporting units;

assignment of assets and liabilities to reporting units;

and estimation of future cash flows, business growth rates, terminal values, discount rates and total enterprise value.

The income approach used is the discounted cash flow methodology and is based on five-year cash flow projections reflecting the Company’s latest projections which included, among other things, the impact of current and projected financial performance of the reporting unit at the time the Company performed its impairment testing.

The cash flows projected are analyzed on a debt-free basis (before cash payments to equity and interest-bearing debt investors) in order to develop an enterprise value from operations for the reporting unit.

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The present value of the finite-period cash flows and the terminal value are determined using a selected discount rate.

Changes in forecasted operations and other assumptions could materially affect the estimated fair values.

Changes in business conditions could potentially require adjustments to these asset valuations.

Indefinite-lived intangibles

The testing of indefinite-lived intangibles (primarily trademarks and tradenames) under established guidelines for impairment also requires significant use of judgment and assumptions (such as cash flow projections, royalty rates, terminal values and discount rates).

As part of the Company’s annual indefinite-lived intangible asset impairment testing (primarily tradenames), the Company has the option to first analyze qualitative factors to determine whether it is more likely than not that an indefinite-lived intangible asset is impaired.

The evaluation of qualitative factors includes an assessment of relevant facts, events, and circumstances including but not limited to:

macroeconomic conditions, industry and market conditions, and the current and forecasted financial performance.

The Company performs a quantitative test when qualitative factors alone are not sufficient to conclude whether it is more likely than not that an indefinite-lived intangible asset is not impaired.

If the Company performs a quantitative test, an impairment loss will only be recognized for the amount by which the carrying value of the indefinite-lived intangible asset exceeds its fair value, not to exceed the total carrying value of the asset.

The quantitative testing of indefinite-lived intangibles (primarily tradenames) under established guidelines for impairment requires significant use of judgment and assumptions (such as cash flow projections, royalty rates, terminal values and discount rates).

An indefinite-lived intangible asset is impaired by the amount by which its carrying value exceeds its estimated fair value.

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Sales of Accounts Receivable

Factored receivables at December 31, 2023 associated with the Company’s existing factoring agreement (the “Customer Receivables Purchase Agreement”) were approximately $ 240 million, a decrease of approximately $ 180 million from December 31, 2022.

Transactions under this agreement are accounted for as sales of accounts receivable, and the receivables sold are removed from the Consolidated Balance Sheet at the time of the sales transaction.

The Company classifies the proceeds received from the sales of accounts receivable as an operating cash flow and collections of accounts receivables not yet submitted to the financial institution as a financing cash flow in the Consolidated Statement of Cash Flows.

The Company records the discount as other (income) expense, net in the Consolidated Statement of Operations.

On October 2, 2023, the Company, through a wholly-owned special purpose entity (“SPE”) entered into a three -year agreement with a financial institution to sell up to $ 225 million, between February and April of each year and up to $ 275 million at all other times, of certain customer receivables without recourse on a revolving basis (the “New Receivables Facility”).

Under the New Receivables Facility, certain of the Company’s subsidiaries continuously sell their accounts receivables, originated in the U.S., to the SPE and the SPE sells the receivables to the financial institution.

The Company maintains a factoring agreement with a financial institution to sell certain customer receivables (the “Customer Receivables Purchase Agreement”) up to $ 700 million.

Factored receivables under the Customer Receivables Purchase Agreement at December 31, 2024 were approximately $ 270 million, an increase of approximately $ 30 million from December 31, 2023.

In addition, the Company, through a wholly-owned special purpose entity (“SPE”), has a three-year factoring agreement with a financial institution to sell up to $ 225 million, between February and April of each year and up to $ 275 million at all other times, of certain customer receivables without recourse on a revolving basis (the “Receivables Facility”).

Under the Receivables Facility, certain of the Company’s subsidiaries continuously sell their accounts receivables, originated in the U.S., to the SPE and the SPE sells the receivables to the financial institution.

The SPE is a variable interest entity for which the Company is considered to be the primary beneficiary.

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The fair value of these servicing arrangements as well as the fees earned was immaterial.

The Company accounts for receivables sold from the SPE to the financial institution as a sale of financial assets and derecognizes the trade receivables from the Company’s Consolidated Balance Sheet.

The balance of outstanding accounts receivables sold to the financial institution as of December 31, 2023 was $ 45 million.

Cash received under the New Receivables Facility is included in cash from operating activities in the Consolidated Statements of Cash Flows.

The balance of outstanding accounts receivables sold to the financial institution as of December 31, 2024 was approximately $ 145 million, an increase of approximately $ 100 million from December 31, 2023.

The Company accounts for receivables sold under both factoring agreements as sale of financial assets and derecognizes the trade receivables from the Company’s Consolidated Balance Sheet.

The Company classifies the proceeds received from the sales of accounts receivable as an operating cash flow and collections of accounts receivables not yet submitted to the financial institutions as financing cash flow in the Consolidated Statements of Cash Flows.

The Company records the discounts as other (income) expense, net in the Consolidated Statements of Operations.

Supplier Finance Program Obligations

The Company has worked with its suppliers of goods and services over the past several years to revisit terms and conditions, including the extension of payment terms.

Additionally, a global financial institution offers a voluntary supply chain finance program (the “SCF Program”) which enables suppliers, at their sole discretion, to sell their receivables from the Company to the financial institution on a non-recourse basis.

The Company and its suppliers agree on contractual terms for the goods and services procured, including prices, quantities and payment terms, regardless of whether the supplier elects to participate in the SCF Program.

Payments terms average approximately 126 days.

In June 2024, the Company entered into an arrangement with a third-party vendor which provides a service for the Company’s suppliers, at their sole discretion, to sell their receivables due from the Company with various financial institutions who, at their sole discretion, contract with the third-party vendor to participate in the supplier finance program (the “New SCF Program”).

The suppliers sell goods or services, as applicable, to the Company and issue the associated invoices to the Company based on the agreed-upon contractual terms.

Suppliers that participate in the SCF Program, at their sole discretion, determine which invoices, if any, they want to sell to the financial institution.

The suppliers’ voluntary inclusion of invoices in the SCF Program does not change the Company’s existing contractual terms with its suppliers.

The Company does not provide any guarantees under the SCF Program, nor does it have any economic interest in a supplier’s decision to participate in the SCF Program as of December 31, 2023.

Amounts due under the SCF Program are included in accounts payable in the Consolidated Balance Sheets and as operating cash flows in the Consolidated Statement of Cash Flows.

The following table sets forth the outstanding payment obligations and activities related to the SCF Program:

Balance at December 31, 2022 $ 100

Invoices posted 336

Invoices paid ( 340 )

Balance at December 31, 2023 $ 96

Suppliers that participate in the New SCF Program, at their sole discretion, determine which invoices, if any, they want to sell to the third-party vendor.

The suppliers’ voluntary inclusion of invoices in the New SCF Program does not change the Company’s existing contractual terms with its suppliers.

The Company does not provide any guarantees or collateral under the New SCF Program, nor does it have any economic interest in a supplier’s decision to participate in the New SCF Program.

Amounts due to suppliers participating in the New SCF Program are included in accounts payable in the Consolidated Balance Sheets and amounts paid to suppliers participating in the New SCF Program are classified as operating cash flows in the Consolidated Statements of Cash Flows.

Supplier payment terms for those participating in the program averaged approximately 130 days.

Prior to the New SCF Program, a global financial institution offered a voluntary supply chain finance program (the “Former SCF Program”) which similarly enabled suppliers, at their sole discretion, to sell their receivables due from the Company to the financial institution on a non-recourse basis.

Pursuant to the Second Amendment (defined hereafter), a lender under the Credit Revolver

(defined hereafter) that also participated in the Former SCF Program secured its related financing pursuant to the terms of the Credit Revolver.

See Footnote 9 for further information.

In April 2024, the Company exercised its right to terminate the Former SCF Program with the financial institution.

The Former SCF Program was terminated in August 2024.

The termination did not materially impact the Company’s operating results, financial condition or liquidity.

There were no outstanding payment obligations relating to the Former SCF Program as of December 31, 2024.

The following table sets forth the outstanding payment obligations due to the third-party vendor at December 31, 2024 and to the financial institution at December 31, 2023, and activities related to the suppliers who participated in the New SCF Program or the Former SCF Program (collectively, the “Supplier Finance Programs”), for the years ended December 31, (in millions):

Balance at beginning of period $ 96 $ 100

Invoices participating in the Supplier Finance Programs 137 336

Invoices paid to the applicable financial institution or third-party vendor ( 219 ) ( 340 )

Balance at end of period $ 14 $ 96

Cash, Cash Equivalents and Restricted Cash

Cash and cash equivalents include cash on hand and highly liquid investments that have a maturity of three months or less when purchased.

Cash and cash equivalents include cash on hand and highly liquid investments that have an original maturity of three months or less when purchased.

Restricted cash reflects cash received on previously sold customer receivables in connection with the factoring programs that are required to be remitted to a financial institution.

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Impaired items are written down to their estimated fair values.

Capitalized software are included in other intangible assets, net in the Consolidated Balance Sheets.

See Footnote 7 for further information.

Capitalized implementation costs for certain qualified Software-as-a-Service (“SaaS”) arrangements are also subject to the same accounting criteria described above, when the Company does not own the intellectual property for the software license used in the arrangement.

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• Share-Based Compensation – Footnote 15

• Legal and Environmental Reserves – Footnote 18

Recent Accounting Pronouncements

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The Company considers the applicability and impact of all ASUs.

In November 2023, the FASB issued ASU 2023-07, “ Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures.” The amendments in this update require that a public entity disclose on an annual and interim basis significant segment expenses that are regularly provided to the CODM, amount for other segment items by reportable segment and a description of its composition, segment profit and loss and assets, additional measures of segment profit used by the CODM in assessing segment performance and the title and position of the CODM, as well as an explanation of how the CODM uses the reported measures in assessing segment performance and deciding allocation of resources.

The amendments in ASU 2023-07 are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

The Company does not expect the adoption of ASU 2023-07 to have a material impact on its consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740):

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The Company does not expect the adoption of ASU 2023-09 to have a material impact on the consolidated financial statements.

In November 2024, the FASB issued ASU No.

2024-03, “ Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures .” This ASU requires that each interim and annual reporting period, an entity disclose more information about the components of certain expense captions that is currently disclosed in the financial statements.

This update is effective for annual reporting periods beginning after December 15, 2026.

Early adoption is permitted.

Management is currently evaluating the effects this guidance will have on its consolidated financial statements.

Adoption of New Accounting Guidance

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Facilitation of the Effects of Reference Rate Reform on Financial Reporting.

” In January 2021, the FASB clarified the scope of this guidance with the issuance of ASU 2021-01,

Reference Rate Reform:

” In January 2021, the FASB clarified the scope of this guidance with the issuance of ASU 2021-01, Reference Rate Reform:

ASU 2020-04 provides optional expedients and exceptions to account for contracts, hedging relationships and other transactions that reference the London Interbank Offered Rate (“LIBOR”) or another reference rate if certain criteria are met.

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See preceding disclosure for further information.

In November 2023, the FASB issued ASU 2023-07, “ Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures.” The amendments in this update require that a public entity disclose on an annual and interim basis significant segment expenses that are regularly provided to the chief operating decision maker (the “CODM”), amount for other segment items by reportable segment and a description of its composition, segment profit and loss and assets, additional measures of segment profit used by the CODM in assessing segment performance and the title and position of the CODM, as well as an explanation of how the CODM uses the reported measures in assessing segment performance and deciding allocation of resources.

The amendments in ASU 2023-07 are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

The Company adopted ASU 2023-07 and it did not have a material impact on its consolidated financial statements.

See Footnote 17 for further information.

Footnote 2 — Divestiture Activity

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As a result, the Company recorded an immaterial , pretax gain which is included in other (income) expense, net in Consolidated Statements of Operations.

On March 31, 2022, the Company sold its CH&S business unit to Resideo Technologies, Inc., for approximately $ 593 million, subject to customary working capital and other post-closing adjustments.

On March 31, 2022, the Company sold its Connected Home and Security (“CH&S”) business unit to Resideo Technologies, Inc., for approximately $ 593 million.

As a result, during the year ended December 31, 2022, the Company recorded a pretax gain of $ 136 million, which was included in other (income) expense, net in Consolidated Statements of Operations.

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The following tables display the components of accumulated other comprehensive income (loss) (“AOCL”), net of tax, as of and for the years ended December 31, 2024 and 2023 (in millions):

Cumulative Translation Adjustment Pension and Postretirement Cost Derivative Financial Instruments AOCL

Cumulative Translation Adjustment Pension and Postretirement Costs Derivative Financial Instruments AOCL

Balance at December 31, 2022 $ ( 688 ) $ ( 309 ) $ ( 14 ) $ ( 1,011 )

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Cumulative translation adjustment

Pension and postretirement benefit plans (2)

Pension and postretirement costs (1)

Derivative financial instruments (2)

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(2) See Footnote 10 for further information.

(3) See Footnote 10 for further information.

The income tax provision (benefit) allocated to the components of AOCL for the years ended December 31, are as follows (in millions):

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Foreign currency translation adjustments $ 33 $ ( 20 ) $ 2

Unrecognized pension and postretirement costs 36 ( 10 ) 20

Pension and postretirement costs ( 5 ) 36 ( 10 )

Derivative financial instruments 8 ( 4 ) 1

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The Company estimates one-time severance and other employee costs related to exit and disposal activities not resulting from an ongoing severance plan based on the benefits available to the employees being terminated.

The Company recognizes these costs when we identify the specific classification or functions of the employees being terminated, notify the employees who might be included in the termination, and expect to terminate employees within the legally required notification period.

When employees are receiving incentives to stay beyond the legally required notification period, we record the cost of their severance over the remaining service period.

The Company recognizes these costs when it identifies the specific classification or functions of the employees being terminated, notifies the employees who might be included in the termination, and expects to terminate employees within the legally required notification period.

When employees are receiving incentives to stay beyond the legally required notification period, the Company records the cost of their severance over the remaining service period.

All cash payments are expected to be paid within one year of charges being incurred.

To better align its resources with its strategy and operating model and to reduce the cost structure of its global operations, the Company commits to restructuring plans as necessary and as follows:

Organizational Realignment Plan

In January 2024, the Company announced an organizational realignment (the “Realignment Plan”), which is expected to strengthen the Company’s front-end commercial capabilities, such as consumer understanding and brand communication, in support of the “where to play” and “how to win” strategy choices the Company unveiled in June of 2023.

In addition to improving accountability, the Realignment Plan was designed to unlock operational efficiencies and cost savings, reduce complexity and free up funds for reinvestment.

As part of the Realignment Plan, the Company has made several operating model changes, which entailed:

standing up a cross-functional brand management organization, realigning business unit finance to fully support the new global brand management model, further simplifying and standardizing regional go-to-market organizations, and centralizing domestic retail sales teams, the digital technology team, business-aligned accounting personnel, the Manufacturing Quality team, and the Human Resources functions into the appropriate center-led teams to drive standardization, efficiency and scale with a One Newell approach.

The Company has also further optimized the Company’s real estate footprint and pursued other cost reduction initiatives.

These actions were primarily implemented by the end of 2024.

Remaining actions, subject to applicable local law and consultation requirements, are expected to be implemented by the end of fiscal year 2025.

Restructuring and restructuring-related charges associated with these actions were estimated to be in the range of $ 75 million to $ 90 million.

This estimate of charges consists primarily of $ 60 million to $ 70 million related to cash severance payments and other termination benefits, $ 11 million to $ 16 million associated with office space reduction and consolidation and approximately $ 4 million of other charges.

The Company expects the majority of the aggregate charges to be cash expenditures.

The Company commenced organizational realignment activities during the first quarter of 2024.

During the twelve months ended December 31, 2024, the Company recorded restructuring and restructuring-related charges of $ 37 million and $ 15 million, respectively.

The Company has incurred aggregate charges of $ 52 million since inception in connection with the Realignment Plan.

In June 2024, as part of optimizing the Company’s real estate footprint, the Company entered into a lease agreement for a new location of its corporate headquarters in Atlanta, Georgia, which will allow it to consolidate five different facilities and bring together employees in the area into a single location.

Also in June 2024, the Company entered into an agreement with an unrelated third party to sell and leaseback its current headquarters facility.

The transaction closed during the fourth quarter of 2024 and the Company received cash proceeds for the sale, for a purchase price that is not material to the Company.

The Company intends to occupy the current facility while waiting to build-out the new facility, which is anticipated to be completed during the first half of fiscal year 2025.

The Company wrote down the carrying value of the assets to their fair value less cost to sell and recorded a net charge of $ 8 million inclusive of a fair market value adjustment related to the below market rental payments associated with the sale leaseback transaction, which was recorded within impairment of goodwill, intangibles and other assets in the Consolidated Statements of Operations for the twelve months ended December 31, 2024.

The net charge of $ 8 million was included in the $ 15 million restructuring-related charges mentioned above.

See Footnote 13 for further information.

Network Optimization Project

In May 2023, the Company announced a restructuring and cost savings initiative that is intended to simplify and streamline its North American distribution network (the “Network Optimization Project”) in order to improve the Company’s cost structure and operating margins while maintaining focus on customer and consumer fulfillment.

The Network Optimization Project incorporated a variety of initiatives, including a reduction in the overall number of distribution centers, an optimization of distribution by location, and completion of select automation investments intended to further streamline the Company’s cost structure and to maximize operating performance.

These actions were substantially implemented by the end of 2024.

The Company estimated that it will incur approximately $ 37 million to $ 49 million in restructuring and restructuring-related charges associated with execution of the Network Optimization Project.

This estimate of charges consists primarily of $ 8 million to $ 11 million related to cash severance payments and other termination benefits and approximately $ 29 million to $ 38 million associated with industrial site reductions.

The Company expects that approximately $ 35 million to $ 44 million of the aggregate charges will be cash expenditures.

In connection with the Network Optimization Project, the Company recorded restructuring charges of $ 3 million and $ 7 million for the twelve months ended December 31, 2024 and 2023, respectively.

The Company also recorded restructuring-related charges of $ 18 million and $ 16 million for the twelve months ended December 31, 2024 and 2023, respectively.

The Company has incurred aggregate charges of $ 44 million since inception of the Network Optimization Project.

Project Phoenix

In January 2023, the Company announced a restructuring and savings initiative (“Project Phoenix”) that was intended to strengthen the Company by leveraging its scale to further reduce complexity, streamline its operating model and drive operational efficiencies.

Project Phoenix was substantially implemented by the end of 2023 and incorporated a variety of initiatives designed to simplify the organizational structure, streamline the Company’s real estate portfolio, centralize the Company’s supply chain functions, transition to a unified One Newell go-to-market model in key international geographies, and reduce overhead costs.

The Company estimated that it will incur approximately $ 100 million to $ 130 million in restructuring and restructuring-related charges in connection with Project Phoenix.

These charges consist primarily of $ 80 million to $ 105 million in charges related to severance payments and other termination benefits;

$ 15 million to $ 20 million in charges associated with office space reductions;

and approximately $ 5 million of other charges, including those associated with employee transition and legal costs.

The Company expects approximately $ 95 million to $ 120 million of the aggregate charges will be cash expenditures.

While the program was mostly complete by the end of 2023, charges were recognized during 2024, as the Company completed remaining actions in accordance with local regulations and consultation requirements.

In connection with Project Phoenix, the Company recorded restructuring charges of $ 2 million and $ 78 million for the twelve months ended December 31, 2024 and 2023, respectively.

The Company also recorded restructuring-related charges of $ 8 million and $ 19 million for the twelve months ended December 31, 2024 and 2023, respectively.

The Company has incurred aggregate charges of $ 107 million since inception of Project Phoenix.

Restructuring charges, net and restructuring-related charges incurred from inception for the Realignment Plan, Network Optimization Project and Project Phoenix (collectively, the “Plans”) were as follows (in millions):

Severance and termination costs Contract termination and other costs Total restructuring

costs Restructuring-related

costs Total costs

Realignment Plan $ 35 $ 2 $ 37 $ 15 $ 52

Network Optimization Project 6 4 10 34 44

Project Phoenix 78 2 80 27 107

$ 119 $ 8 $ 127 $ 76 $ 203

Restructuring charges, net and restructuring-related charges incurred by reportable business segment in connection with the Plans, since inceptions were as follows (in millions):

Total restructuring

Restructuring-related

Home and Commercial Solutions $ 51 $ 38 $ 89

Learning and Development 27 1 28

Outdoor and Recreation 15 10 25

Corporate 34 27 61

$ 127 $ 76 $ 203

Other Restructuring and Restructuring-Related Charges

The Company also incurs other restructuring and restructuring-related charges in connection with various discrete initiatives.

The Company recorded $ 3 million, $ 10 million and $ 15 million of other restructuring costs during the twelve months ended December 31, 2024, 2023 and 2022, respectively.

Restructuring-related charges are recorded in cost of products sold, SG&A and impairment of other assets in the Consolidated Statements of Operations based on the nature of the underlying charges incurred.

During the twelve months ended December 31, 2024, 2023 and 2022, the Company recorded other restructuring-related charges of $ 16 million, $ 64 million and $ 24 million, respectively.

Restructuring costs incurred by reportable business segment for all restructuring activities for the years ended December 31, are as follows (in millions):

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Accrued restructuring costs activity for the year ended December 31, 2024 are as follows (in millions):

Balance at December 31, 2022 Restructuring Costs, Net Payments Foreign Currency and Other Balance at December 31, 2023

Balance at December 31, 2023 Restructuring Costs, Net Payments Balance at December 31, 2024

Severance and termination costs $ 30 $ 40 $ ( 58 ) $ 12

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Accrued restructuring costs activity for the year ended December 31, 2023 are as follows (in millions):

Balance at December 31, 2021 Restructuring Costs, Net Payments Balance at December 31, 2022

Balance at December 31, 2022 Restructuring Costs, Net Payments Foreign Currency and Other Balance at December 31, 2023

Severance and termination costs $ 7 $ 89 $ ( 66 ) $ — $ 30

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$ 7 $ 95 $ ( 71 ) $ ( 1 ) $ 30

Project Phoenix

In January 2023, the Company announced a restructuring and savings initiative (“Project Phoenix”) that was intended to strengthen the Company by leveraging its scale to further reduce complexity, streamlining its operating model and driving operational efficiencies.

Project Phoenix was substantially implemented by the end of 2023 and incorporated a variety of initiatives designed to simplify the organizational structure, streamline the Company’s real estate portfolio, centralize the Company’s supply chain functions, which include manufacturing, distribution, transportation and customer service, transition to a unified One Newell go-to-

market model in key international geographies, and otherwise reduce overhead costs.

The Company estimates that it will incur approximately $ 100 million to $ 130 million in restructuring and restructuring-related charges in connection with Project Phoenix, substantially all of which was incurred by the end of 2023.

These charges consist primarily of $ 80 million to $ 105 million in charges related to severance payments and other termination benefits;

$ 15 million to $ 20 million in charges associated with office space reductions;

and approximately $ 5 million of other charges, including those associated with employee transition and legal costs.

The Company expects approximately $ 95 million to $ 120 million of the total aggregate charges will be cash expenditures.

The Company commenced reducing headcount in the first quarter of 2023, and while the program is mostly complete, charges will continue to be recognized as the Company completes remaining actions, in accordance with local regulations and consultation requirements.

All cash payments are expected to be paid within one year of charges incurred.

During the year ended December 31, 2023, the Company recorded restructuring charges of $ 78 million in connection with Project Phoenix.

See Recent Developments in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations for further information.

Network Optimization Project

In May 2023, the Company announced a restructuring and savings initiative that is intended to simplify and streamline its North American distribution network (the “Network Optimization Project”) in order to improve the Company’s cost structure and operating margins while maintaining focus on customer and consumer fulfillment.

The Company initiated implementation of the Network Optimization Project during the second quarter of 2023 and expects it to be substantially implemented by the end of fiscal year 2024.

The Network Optimization Project incorporates a variety of initiatives, including a reduction in the overall number of distribution centers, an optimization of distribution by location, and completion of select automation investments intended to further streamline the Company’s cost structure and to maximize operating performance.

The Company currently estimates that it will incur approximately $ 37 million to $ 49 million in restructuring and restructuring-related charges associated with execution of the Network Optimization Project and expects that the costs incurred will be substantially complete by the end of 2024.

The Company expects approximately $ 35 million to $ 44 million of the total aggregate charges will be cash expenditures.

During the year ended December 31, 2023, the Company recorded restructuring charges of $ 7 million in connection with the Network Optimization Project.

See Recent Developments in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations for further information.

Other Restructuring and Restructuring-Related Costs

The Company regularly incurs other restructuring and restructuring-related costs in connection with various discrete initiatives, including certain costs associated with the 2020 Restructuring Plan, which was designed to reduce overhead costs and streamline certain underperforming operations and was completed at the end of 2021 and Project Ovid, the multi-year, customer centric supply chain initiative to transform the Company’s go-to-market capabilities in the U.S., improve customer service levels and drive operational efficiencies.

During the years ended December 31, 2023, 2022 and 2021, the Company recorded other restructuring charges of $ 10 million, $ 15 million and $ 16 million, respectively.

Restructuring-related costs are recorded in cost of products sold and SG&A in the Consolidated Statements of Operations based on the nature of the underlying costs incurred.

Realignment Plan

In January 2024, the Company announced an organizational realignment, which is expected to strengthen the Company’s front-end commercial capabilities, such as consumer understanding and brand communication, in support of the “where to play” and “how to win” strategies the Company unveiled in June of 2023.

In addition to improving accountability, the Company’s organizational realignment is designed to unlock operational efficiencies and cost savings, reduce complexity and free up funds for reinvestment.

As part of the organizational realignment, the Company is making several operating model changes, which entail:

The Company will also further optimize the Company’s real estate footprint and pursue other cost reduction initiatives.

These actions are expected to be substantially implemented by the end of 2024, subject to local law and consultation requirements.

Restructuring and restructuring-related charges associated with these actions are estimated to be in the range of $ 75 million to $ 90 million and are expected to be substantially incurred by the end of 2024.

Footnote 5 — Inventories

Inventories are stated at the lower of cost or net realizable value.

Inventories are stated at the lower of cost or net realizable value, with cost generally determined using first-in, first-out method.

The Company reduces its inventory value for estimated obsolete and slow-moving inventory in an amount equal to the difference between the cost of inventory and the net realizable value based upon assumptions about future demand and market conditions.

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December 31, 2024

Net Book Value at December 31, 2022 Impairment Charges Foreign Exchange Gross Carrying Amount Accumulated Impairment Charges Net

Net Book Value at December 31, 2023 Foreign

Value Gross Carrying Amount Accumulated Impairment Charges

Home and Commercial Solutions $ 747 $ — $ 747 $ 4,052 $ ( 3,305 )

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$ 3,071 $ ( 33 ) $ 3,038 $ 8,218 $ ( 5,180 )

The Company performed a quantitative impairment test and determined that the Baby reporting unit goodwill was impaired.

During the third quarter of 2023, the Company recorded a non-cash impairment charge of $ 241 million as the carrying value of the reporting unit exceeded its fair value.

December 31, 2023

Net Book Value at December 31, 2021 Impairment Charges Foreign Exchange Gross Carrying Amount Accumulated Impairment Charges Net

Home and Commercial Solutions $ 911 $ ( 164 ) $ — $ 4,052 $ ( 3,305 ) $ 747

Learning and Development 2,593 — ( 42 ) 3,397 ( 846 ) 2,551

Outdoor and Recreation — — — 788 ( 788 ) —

$ 3,504 $ ( 164 ) $ ( 42 ) $ 8,237 $ ( 4,939 ) $ 3,298

During the fourth quarter of 2022, in conjunction with its annual impairment testing, the Company recorded a non-cash impairment charge to write-off the remaining $ 56 million of goodwill for its Home Fragrance reporting unit, in the Home and Commercial Solutions segment as the carrying value exceeded its fair value.

This impairment reflected a further downward revision to the forecasted cash flows used in connection with the third quarter triggering event assessment, driven by inflationary pressures which continue to impact discretionary spending behavior of consumers at higher rates than previously expected.

During the third quarter of 2022, the Company concluded that a triggering event had occurred for its Home Fragrance reporting unit, in the Home and Commercial Solutions segment, as a result of a downward revision of forecasted cash flows due to softening global demand, as retailers significantly pulled back on orders in an effort to rebalance inventory, and rising interest rates.

The decline in global demand is driven primarily by inflationary pressures which are impacting the discretionary spending behavior of consumers.

The Company performed a quantitative impairment test and determined that the Home Fragrance reporting unit goodwill was impaired and recorded a non-cash impairment charge of $ 108 million, as the carrying value of the reporting unit exceeded its fair value.

The impairment charges for indefinite-lived tradenames were recorded in the Company’s reporting segments as follows for the years ended December 31, (in millions):

Impairment of indefinite-lived tradenames

Net Book Value at December 31, 2022 Impairment Charges Foreign

Value Gross Carrying Amount Accumulated Impairment Charges

Home and Commercial Solutions $ 747 $ — $ — $ 747 $ 4,052 $ ( 3,305 )

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$ 3,298 $ ( 241 ) $ 14 $ 3,071 $ 8,251 $ ( 5,180 )

(1) During the fourth quarter of 2023, in conjunction with its annual impairment testing, the Company recorded a non-cash impairment charge of $ 68 million associated with two tradenames in the Home and Commercial Solutions segment, as the carrying values exceeded the fair values.

The decline in the fair values of the tradenames in the Home and Commercial Solutions segment were due to current market contraction, reflecting a reset of demand levels.

During the third quarter of 2023, the Company concluded that a triggering event had occurred for an indefinite-lived tradename in the Outdoor and Recreation segment, as a result of a downward revision of forecasted cash flows due to market conditions, as well as rising interest rates.

The Company performed a quantitative impairment test and determined that the indefinite-lived tradename in the Outdoor and Recreation segment was impaired.

During the third quarter of 2023, the Company recorded a non-cash impairment charge of $ 22 million for the indefinite-lived tradename in the Outdoor and Recreation segment, as the carrying value of the tradename exceeded its fair value.

During the second quarter of 2023, the Company concluded that a triggering event had occurred for indefinite-lived tradename in the Home Fragrance reporting unit in the Home and Commercial Solutions segment as a result of a downward revision of forecasted cash flows due to softening global demand, primarily caused by continued inflationary pressure that is impacting discretionary spending behavior of consumers, as well as rising interest rates.

The Company performed a quantitative impairment test and determined that the indefinite-lived tradename in the Home and Commercial Solutions segment was impaired.

During the second quarter of 2023, the Company recorded a non-cash impairment charge of $ 8 million, as the carrying value of the tradename exceeded its fair value.

(2) During the fourth quarter of 2022, in conjunction with its annual impairment testing, the Company recorded aggregate non-cash impairment charges of $ 270 million associated with two tradenames in the Home and Commercial Solutions segment and one tradename in the Learning and Development segment, as the carrying values exceeded their fair values.

The decline in fair values for one tradename in the Home and Commercial Solutions segment and the tradename in the Learning and Development segment reflected a further downward revision to the forecasted cash flows used in connection with the third quarter triggering event assessment, driven by inflationary pressures which are impacting discretionary spending behavior of consumers at higher rates than previously expected, including higher than expected overhead costs.

The decline in fair value for the remaining tradename in the Home and Commercial Solutions segment reflected a change in management's assumptions, including the timing of a labor shortage recovery in a certain international market, which negatively impacted the long-term profitability estimates used to develop the forecasted cash flow projections for the annual impairment test.

During the third quarter of 2022, the Company concluded that a triggering event had occurred for two indefinite-lived tradenames in the Home and Commercial Solutions segment, as a result of a downward revision of forecasted cash flows due to softening global demand, as retailers significantly pulled back on orders in an effort to rebalance inventory and rising interest rates.

The decline in global demand is driven primarily by inflationary pressures which are impacting the discretionary spending behavior of consumers.

The Company also concluded that a triggering event had occurred for two indefinite-lived tradenames in the Learning and Development segment, as a result of rising interest rates and inflationary pressures.

The Company performed a quantitative impairment test and determined that the indefinite-lived tradenames in the Home and Commercial Solutions segment and two indefinite-lived tradenames in the Learning and Development segment were impaired.

During the third quarter of 2022, the Company recorded an aggregate non-cash impairment charge of $ 40 million, as the carrying values of these tradenames exceeded their fair values.

(3) During the fourth quarter of 2021, in conjunction with its annual impairment testing, the Company recorded non-cash impairment charges of $ 60 million associated with two tradenames in the Home and Commercial Solutions and Learning and Development segments, as the carrying values exceeded their fair values, reflecting a downward revision of future expected cash flows, which include the impact of the COVID-19 global pandemic.

The table below summarizes the balance of other intangible assets, net and the related amortization periods using the straight-line method and attribution method at December 31, 2024 and 2023 (in millions):

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$ 3,074 $ ( 1,066 ) $ 2,008 $ 3,495 $ ( 1,007 ) $ 2,488

(1) In connection with the operating model changes associated with Project Phoenix, the Company determined that six tradenames with aggregate carrying values of $ 70 million no longer met indefinite-lived criteria and were reclassified during the first quarter of 2023 as finite-lived tradenames with useful lives ranging from five to ten years .

(1) In alignment with the Company’s strategy, the Company determined that certain tradenames with aggregate carrying values of $ 322 million no longer met the criteria to be classified as indefinite-lived tradenames effective January 1, 2024.

The estimated useful lives range from 10 to 15 years, which increased the Company’s annual amortization expense by approximately $ 25 million.

Amortization expense for intangible assets was $ 135 million, $ 109 million and $ 100 million in 2024, 2023 and 2022, respectively.

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Thereafter 648

During 2024, the Company elected to perform a qualitative assessment for the Writing reporting unit, with goodwill of $ 1.9 billion and concluded that there were no events or circumstances that rise to a level that would more likely than not reduce the fair value of the reporting unit below the carrying value;

therefore, a quantitative goodwill impairment analysis was not required for the Writing reporting unit.

The Company elected to perform quantitative assessments for the Commercial and Baby reporting units with goodwill of $ 747 million and $ 415 million, respectively.

Based on the Company’s quantitative assessments, no impairment charges were recorded for the Commercial and Baby reporting units.

During 2024, the Company elected to perform qualitative assessments for two indefinite-lived tradenames in the L&D segment, with total carrying values of $ 119 million.

Based on the qualitative assessments, the Company concluded there were no events or circumstances that rise to a level that would more likely that not reduce the fair value of those indefinite-lived tradenames below the carrying value;

therefore, a quantitative impairment analysis was not required for two indefinite-lived tradenames in the L&D segment.

The Company elected to perform quantitative assessments for indefinite-lived tradenames in the H&CS and L&D segments with total carrying values of $ 725 million.

Refer to the following table for the results of the quantitative assessments.

The impairment charges for goodwill and indefinite-lived tradenames were recorded in the Company’s reporting segments as follows for the years ended December 31, (in millions):

Home and Commercial Solutions $ 275 $ 76 $ 444

Learning and Development 70 241 30

Outdoor and Recreation — 22 —

$ 345 $ 339 $ 474

(1) During the fourth quarter of 2024, in conjunction with its annual impairment testing, the Company recorded non-cash impairment charge of $ 85 million associated with one tradename in the H&CS segment, as the carrying value exceeded the fair value.

A hypothetical 10% reduction in the forecasted revenue and residual (excess) cash flows used in the excess earnings method applied in determining the fair value of the tradename would have resulted in an incremental impairment charge on the H&CS segment of $ 22 million.

The Company performed quantitative impairment tests and determined that the indefinite-lived tradenames in the H&CS and L&D segments, were impaired.

During the third quarter of 2024, the Company recorded non-cash impairment charges of $ 190 million and $ 70 million for the indefinite-lived tradenames in the H&CS and in the L&D segments, respectively, as the carrying values exceeded their fair values.

(2) During the fourth quarter of 2023, in conjunction with its annual impairment testing, the Company recorded a non-cash impairment charge of $ 68 million associated with two tradenames in the H&CS segment, as the carrying values exceeded the fair values.

The decline in the fair values of the tradenames in the H&CS segment were due to current market contraction, reflecting a reset of demand levels.

During the third quarter of 2023, the Company concluded that a triggering event had occurred for an indefinite-lived tradename in the O&R segment, as a result of a downward revision of forecasted cash flows due to market conditions, as well as rising interest rates.

The Company performed a quantitative impairment test and determined that the indefinite-lived tradename in the O&R segment was impaired and recorded a non-cash impairment charge of $ 22 million for the indefinite-lived tradename in the O&R segment, as the carrying value of the tradename exceeded its fair value.

Also, during the third quarter of 2023, the Company concluded that a triggering event had occurred for the goodwill associated with the Baby reporting unit in the L&D segment as a result of a downward revision of forecasted cash flows due to lower volume and profitability expectations, as well as rising interest rates.

The Company performed a quantitative impairment test and determined that the Baby reporting unit goodwill was impaired and recorded a non-cash impairment charge of $ 241 million as the carrying value of the reporting unit exceeded its fair value.

During the second quarter of 2023, the Company concluded that a triggering event had occurred for an indefinite-lived tradename in the H&CS segment as a result of a downward revision of forecasted cash flows due to softening global demand, primarily caused by continued inflationary pressure that is impacting discretionary spending behavior of consumers, as well as rising interest rates.

The Company performed a quantitative impairment test and determined that the indefinite-lived tradename in the H&CS segment was impaired.

During the second quarter of 2023, the Company recorded a non-cash impairment charge of $ 8 million, as the carrying value of the tradename exceeded its fair value.

(3) During the fourth quarter of 2022, in conjunction with its annual impairment testing, the Company recorded aggregate non-cash impairment charges of $ 270 million associated with two tradenames in the H&CS segment and one tradename in the L&D segment, as the carrying values exceeded their fair values.

The decline in fair values for one tradename in the H&CS segment and the tradename in the L&D segment reflected a further downward revision to the forecasted cash flows used in connection with the third quarter triggering event assessment, driven by inflationary pressures which are impacting discretionary spending behavior of consumers at higher rates than previously expected, including higher than expected overhead costs.

The decline in fair value for the remaining tradename in the H&CS segment reflected a change in management’s assumptions, including the timing of a labor shortage recovery in a certain international market, which negatively impacted the long-term profitability estimates used to develop the forecasted cash flow projections for the annual impairment test.

During the third quarter of 2022, the Company concluded that a triggering event had occurred for two indefinite-lived tradenames in the H&CS segment, as a result of a downward revision of forecasted cash flows due to softening global demand, as retailers significantly pulled back on orders in an effort to rebalance inventory and rising interest rates.

The decline in global demand is driven primarily by inflationary pressures which are impacting the discretionary spending behavior of consumers.

The Company also concluded that a triggering event had occurred for two indefinite-lived tradenames in the L&D segment, as a result of rising interest rates and inflationary pressures.

The Company performed a quantitative impairment test and determined that the indefinite-lived tradenames in the H&CS segment and two indefinite-lived tradenames in the L&D segment were impaired.

During the third quarter of 2022, the Company recorded an aggregate non-cash impairment charge of $ 40 million, as the carrying values of these tradenames exceeded their fair values.

The Company continues to evaluate its brand strategy including the assessment of indefinite-lived criteria which may impact the future estimated intangible amortization.

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Customer accruals $ 601 $ 659

Accrued compensation 249 190

Operating lease liabilities 110 122

Accrued self-insurance liabilities, contingencies and warranty 92 99

Accrued income taxes 88 89

Accrued interest expense 74 63

Accrued marketing and freight expenses 73 71

Accrued interest expense 72 74

Accrued self-insurance liabilities, contingencies and warranty 68 92

Other 198 268

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Footnote 9 — Debt

The following is a summary of outstanding debt at December 31, (in millions):

The following is a summary of outstanding debt, net of unamortized issuance costs and original issue discount, at December 31, (in millions):

4.000 % senior notes due 2024 (1)

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6.625 % senior notes due 2032

5.375 % senior notes due 2036

5.500 % senior notes due 2046

Revolving credit facility (1) (2)

Commercial paper — 359

Receivables facility — 35

Other debt 2 1

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Long-term debt $ 4,508 $ 4,575

On August 21, 2023, Moody's Corporation (“Moody’s”) downgraded the Company’s debt ratings to “Ba2”.

As a result of Moody’s downgrade, certain of the Company’s outstanding senior notes currently aggregating to approximately $ 3.1 billion (the “Coupon-Step Notes”) are subject to an interest rate adjustment of 25 basis points.

The change to the interest rate due to the downgrade will increase the Company’s interest expense by approximately $ 8 million on an annualized basis (approximately $ 2 million in 2023).

On August 3, 2023, S&P Global Inc.

(“S&P”) downgraded the Company’s debt ratings to “BB”.

In March 2023, S&P had also downgraded the Company’s debt ratings to “BB+”.

As a result of the S&P downgrades, the Company’s Coupon-Step Notes are subject to an aggregated interest rate adjustment of 50 basis points.

The change to the interest rate due to the downgrade will increase the Company’s interest expense by approximately $ 15 million on an annualized basis (approximately $ 8 million in 2023).

Furthermore, as a result of the March S&P downgrade, the Company’s ability to borrow from the commercial paper market on terms it deems acceptable or favorable was eliminated.

On February 9, 2024, Moody’s downgraded the Company’s senior unsecured debt rating to “Ba3”, subjecting the Coupon-Step Notes to an additional interest rate adjustment of 25 basis points.

The change to the interest rate due to the downgrade will further increase the Company’s interest expense by approximately $ 8 million on an annualized basis (approximately $ 6 million in 2024).

On February 14, 2024, S&P downgraded the Company’s debt ratings to “BB-”, subjecting the Company’s Coupon-Step Notes to an additional interest rate adjustment of 25 basis points, which will increase interest expense by approximately $ 8 million on an annualized basis (approximately $ 6 million in 2024).

The S&P and Moody’s downgrades will increase the Company’s annual interest expense by approximately $ 39 million.

On February 14, 2023, Fitch Ratings downgraded the Company’s Long-Term Issuer Default Rating to “BB”, then to “B+” on November 1, 2023.

These downgrades did not impact the interest rates on any of the Company’s senior notes.

Receivables Facility

The Company maintained an Accounts Receivable Securitization Facility (the “Securitization Facility”).

The aggregate commitment under the Securitization Facility was $ 375 million.

The Securitization Facility matured on October 2, 2023 and was terminated thereafter.

(1) Included in short-term debt and current portion of long-term debt at December 31, 2023.

(2) Included in short-term debt and current portion of long-term debt at December 31, 2024.

In November 2024, the Company completed a registered public offering and sale of $ 750 million of aggregate principal amount of 6.375 % senior notes due 2030 (the “2030 Notes”) and $ 500 million of aggregate principal amount of 6.625 % senior notes due 2032 (the “2032 Notes”) (collectively the “Notes”) and received proceeds of approximately $ 1.24 billion, net of fees and expenses paid.

The Notes were issued pursuant to an Indenture, dated as of November 19, 2014, between the Company (formerly known as “Newell Rubbermaid Inc.”) and U.S.

Bank Trust Company, National Association (formerly known as “U.S.

Bank National Association”), as trustee (the “Trustee”), as supplemented by the First Supplemental Indenture relating to the 2030 Notes, dated November 13, 2024 (the “First Supplemental Indenture”), by and between the Company and the Trustee, and the Second Supplemental Indenture relating to the 2032 Notes, dated November 13, 2024 (the “Second Supplemental Indenture” and, collectively with the First Supplemental Indenture, the “Supplemental Indentures”), by and between the Company and the Trustee.

The Supplemental Indentures provide, among other things, that the Notes are senior unsecured obligations of the Company and include covenants that limit the ability of the Company and its subsidiaries to incur or guarantee additional debt, create or permit certain liens, redeem or repurchase certain debt, consummate certain asset sales, make certain loans and investments, consolidate, merge, or sell all or substantially all of the Company and its subsidiaries assets, enter into certain transactions with affiliates and pay distributions on, or redeem or repurchase the Company’s capital stock, subject in each case to certain qualifications and exceptions, including the termination of certain of these covenants upon the Notes receiving investment grade credit ratings.

The Company used the proceeds of the offering to fully redeem its outstanding 4.875 % senior notes due 2025 and to redeem in part its outstanding 4.200 % senior notes due 2026.

In November 2024, the Company fully redeemed its 4.875 % notes due 2025 at a redemption price equal to 100 % of the outstanding aggregate principal amount of the notes, plus accrued unpaid interest to the date of the redemption.

The total consideration was approximately $ 511 million.

The Company also partially redeemed $ 750 million of the outstanding aggregate amount of the 4.200 % senior notes due 2026 at a redemption price of 101.006 %.

The total consideration, including accrued unpaid interest to the date of its redemption was approximately $ 764 million.

As a result of the aforementioned redemptions, the Company recorded a total loss on debt extinguishment of $ 13 million.

In December 2024, the Company repaid the outstanding aggregate principal amount of its 4.000 % senior notes, plus accrued and unpaid interest upon maturity for total consideration of $ 205 million.

Rating Downgrades

In February 2024, Moody’s Corporation (“Moody’s”) and S&P Global Inc.

(“S&P”) downgraded the Company’s senior unsecured debt rating to “Ba3” and “BB-”, respectively.

As a result, the Company’s outstanding senior notes aggregating to approximately $ 3.1 billion at that time (the “Coupon-Step Notes”) were subject to an interest rate increase of 25 basis points for each downgrade, or 50 basis points in the aggregate.

The change to the interest rate due to the Moody’s and S&P downgrades collectively increased the Company’s interest expense by approximately $ 16 million on an annualized basis at the time of the downgrades (approximately $ 12 million in 2024).

The partial redemption of the 4.200 % senior notes due 2026 during the fourth quarter of 2024 decreased the aggregate amount of the Coupon-Step Notes to $ 2.3 billion, resulting in a reduction of the Company’s annualized interest expense impact of the February 2024 Moody’s and S&P downgrades by approximately $ 4 million, reducing the aggregate annualized impact of the downgrades to approximately $ 12 million beginning in 2025.

Revolving Credit Facility

As of December 31, 2023, the Company maintained a $ 1.5 billion Credit Revolver maturing in August 2027.

On March 27, 2023, the Company entered into the First Amendment to (i) include non-cash expenses resulting from grants of stock awards among the items that may be added to Consolidated Net Income when calculating Consolidated Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”), as defined in the First Amendment, and (ii) lower the Interest Coverage Ratio, as defined in the First Amendment, for the fiscal quarters ending on June 30, 2023, September 30, 2023, December 31, 2023 and March 31, 2024.

At December 31, 2023, the Company maintained a $ 1.5 billion senior unsecured revolving credit facility (the “Credit Revolver”) maturing in August 2027.

On March 27, 2023, the Company entered into an amendment (the “First Amendment”) to (i) include non-cash expenses resulting from grants of stock awards among the items that may be added to Consolidated Net Income when calculating Consolidated Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”), as defined in the First Amendment, and (ii) lower the Interest Coverage Ratio, as defined in the First Amendment, for the fiscal quarters ending on June 30, 2023, September 30, 2023, December 31, 2023 and March 31, 2024.

On February 7, 2024, the Company, certain of its subsidiaries, as subsidiary borrowers, and certain of its subsidiaries, as subsidiary guarantors, entered into a second amendment to the Credit Revolver agreement (the “Second Amendment”).

The Second Amendment, among other things, (i) reduced the commitments of the lenders from $ 1.5 billion to $ 1.0 billion, (ii) replaced the Company’s existing financial covenants with new financial covenants testing the Company’s Collateral Coverage Ratio and Total Net Leverage Ratio (each further defined in the Second Amendment), (iii) required the Company and certain of the Company’s domestic and foreign subsidiaries (collectively, the “Guarantors”) to guarantee all obligations under the Credit Revolver including, without limitation, obligations in respect of extensions of credit to any of the borrowers, certain hedging obligations, certain cash management obligations, and certain supply chain financing obligations, and (iv) required the Company and the other Guarantors to grant a lien and security interest in certain of its assets consisting of eligible accounts receivable, eligible inventory, eligible equipment and eligible intellectual property, and all products and proceeds of the foregoing, subject to certain limitations.

See Footnote 1 for further information with respect to the Company’s Supplier Finance Programs.

The Credit Revolver provides for the issuance of up to $ 150 million of letters of credit, so long as there is sufficient availability for borrowing under the Credit Revolver.

At December 31, 2023, the Company had $ 131 million of outstanding borrowings under the Credit Revolver and approximately $ 20 million of outstanding standby letters of credit issued against the Credit Revolver, with a net availability of approximately $ 1.3 billion.

As disclosed in the Company’s Current report on Form 8-K filed with the SEC on February 9, 2024, the Company, certain of its subsidiaries, as subsidiary borrowers, and certain of its subsidiaries, as subsidiary guarantors, entered into the Second Amendment.

The Second Amendment, among other things, (i) reduces the commitments of the lenders from $ 1.5 billion to $ 1.0 billion, (ii) replaces the Company’s existing Total Indebtedness to Total Capitalization and Interest Coverage Ratio financial covenants with new financial covenants testing the Company’s Collateral Coverage Ratio and Total Net Leverage Ratio (each as defined in the Second Amendment), (iii) requires the Company and the Guarantors to guarantee all obligations under the Credit Revolver including, without limitation, obligations in respect of extensions of credit to any of the borrowers, certain hedging obligations, certain cash management obligations, and certain supply chain financing obligations, and (iv) requires the Company and the other Guarantors to grant a lien and security interest in certain of its assets consisting of eligible accounts receivable, eligible inventory, eligible equipment and eligible intellectual property, and all products and proceeds of the foregoing.

At December 31, 2024, the Company had $ 40 million of outstanding borrowings under the Credit Revolver and approximately $ 35 million of outstanding standby letters of credit issued against the Credit Revolver, with a net availability of approximately $ 925 million.

Availability under the Credit Revolver is subject to change in accordance with the terms thereof, including in response to changes to the Company’s pledged collateral value or outstanding borrowings and letters of credit under the Credit Revolver.

Future Debt Maturities

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$ 87 $ 1,235 $ 500 $ 2 $ 500 $ 2,336 $ 4,660

The indentures governing the Company’s senior notes contain usual and customary nonfinancial covenants.

The Company’s borrowing arrangements other than the senior notes contain usual and customary nonfinancial covenants and certain financial covenants, including minimum interest coverage and maximum debt-to-total-capitalization ratios.

The indentures governing the Company’s senior notes contain usual and customary nonfinancial covenants, as well as additional covenants contained in the 2030 Notes and 2032 Notes, such as described above.

The Company’s borrowing arrangements other than the senior notes contain usual and customary nonfinancial covenants and certain financial covenants, including minimum collateral coverage and net leverage ratios.

Weighted average interest rates for the years ended December 31, are as follows:

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Derivative financial instruments are generally used to manage certain interest rate and foreign currency risks.

These instruments primarily include interest rate swaps, forward starting interest rate swaps and forward exchange contracts.

These instruments, from time to time, may primarily include interest rate swaps, forward starting interest rate swaps and forward exchange contracts.

The Company’s forward exchange contracts generally do not subject the Company to exchange rate risk because gains and losses on these instruments generally offset gains and losses on the assets, liabilities and other transactions being hedged.

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At December 31, 2024, the Company had approximately $ 1.0 billion notional amount of interest rate swaps that exchange a fixed rate of interest for a variable rate of interest plus a weighted average spread.

These floating rate swaps are designated as fair value hedges against $ 500 million of principal on the 6.375 % senior notes due 2027, $ 500 million of principal on the 6.625 % senior notes due 2029 and $ 100 million of principal on the 4.000 % senior notes due 2024 for the remaining life of the notes.

The benchmark interest rate for the $ 100 million floating swap and associated fair value hedge was amended for a change in benchmark interest rate from London Interbank Offered Rate (“LIBOR”) to Secured Overnight Financing Rate (“SOFR”), effective June 1, 2023, accounted for in accordance with ASC 848 (see Footnote 1 of the Notes to Consolidated Financial Statements for further information).

These floating rate swaps are designated as fair value hedges against $ 500 million of principal on the 6.375 % senior notes due 2027 and $ 500 million of principal on the 6.625 % senior notes due 2029 for the remaining life of the notes.

The effective portion of the fair value gains or losses on these swaps is offset by fair value adjustments in the underlying debt.

The swap designated as a fair value hedge associated with the $ 100 million of principal on the 4.000 % senior notes due 2024, matured on December 2024, concurrent with the maturity of the notes.

Cross-Currency Contracts

The Company uses cross-currency swaps to hedge foreign currency risk on certain financing arrangements.

The Company previously entered into three cross-currency swaps, maturing in January 2025, February 2025 and September 2027, respectively, with an aggregate notional amount of $ 1.3 billion.

The Company previously entered into three cross-currency swaps, maturing in January 2025, February 2025 and September 2027, with an aggregate notional amount of $ 1.3 billion.

During the fourth quarter of 2024, the Company closed two of these cross-currency swaps, ahead of maturities of January 2025 and February 2025, with an aggregate notional amount of $ 900 million and received total consideration of approximately $ 27 million.

Also, during the fourth quarter of 2024, the Company entered into three new cross-currency swaps, two maturing in November 2026 and one in November 2028, with an aggregate notional amount of $ 770 million.

Each of these cross-currency swaps was designated as a net investment hedge of the Company’s foreign currency exposure of its net investment in certain Euro-functional currency subsidiaries with Euro-denominated net assets, and the Company pays a fixed rate of Euro-based interest and receives a fixed rate of U.S.

dollar interest.

During the third quarter of 2022, the Company entered into two additional cross-currency swaps with notional amounts of $ 500 million each, with one maturing in September 2027 and one in September 2029.

These swaps were also designated as net investment hedges of the Company’s foreign currency exposure of its net investment in certain Euro-functional currency subsidiaries with Euro-denominated net assets, and the Company pays a floating rate of Euro-based interest and receives a floating rate of U.S.

During the third quarter of 2022, the Company entered into two cross-currency swaps with an aggregate notional amount of $ 1.0 billion, maturing in September 2027 and September 2029.

These swaps were designated as net investment hedges of the Company’s foreign currency exposure of its net investment in certain Euro-functional currency subsidiaries with Euro-denominated net assets, and the Company pays a floating rate of Euro-based interest and receives a floating rate of U.S.

dollar interest.

At December 31, 2024, the Company has cross-currency swaps outstanding with an aggregate notional amount of approximately $ 2.1 billion.

The Company has elected the spot method for assessing the effectiveness of these contracts.

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The derivatives used to hedge these forecasted transactions that meet the criteria for hedge accounting are accounted for as cash flow hedges.

The effective portion of the gains or losses on these derivatives is deferred as a component of accumulated other comprehensive income (loss) (“AOCL”) until it is recognized in earnings at the same time that the hedged item affects earnings and is included in the same caption in the statements of operations as the underlying hedged item.

At December 31, 2023, the Company had approximately $ 348 million

notional amount outstanding of forward foreign currency contracts that are designated as cash flow hedges of forecasted inventory purchases and sales.

The effective portion of the gains or losses on these derivatives is deferred as a component of AOCL until it is recognized in earnings at the same time that the hedged item affects earnings and is included in the same caption in the statements of operations as the underlying hedged item.

At December 31, 2024, the Company had approximately $ 337 million notional amount outstanding of forward foreign currency contracts that are designated as cash flow hedges of forecasted inventory purchases and sales.

The Company also uses foreign currency contracts, primarily forward foreign currency contracts, to mitigate the foreign currency exposure of certain other foreign currency transactions.

At December 31, 2023, the Company had approximately $ 1.3 billion notional amount outstanding of these foreign currency contracts that are not designated as effective hedges for accounting purposes and have maturity dates through July 2024.

Fair market value gains or losses are included in the results of operations and are classified in other (income) expense, net in the Company’s Consolidated Statement of Operations.

At December 31, 2024, the Company had approximately $ 1.0 billion notional amount outstanding of these foreign currency contracts that are not designated as effective hedges for accounting purposes and have maturity dates through June 2025.

Fair market value gains or losses are included in the results of operations and are classified in other (income) expense, net in the Company’s Consolidated Statements of Operations.

The following table presents the fair value of derivative financial instruments at December 31, (in millions):

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Total $ 22 $ ( 120 )

The Company recognized expense of $ 17 million, $ 13 million and income of $ 13 million in other (income) expense, net, during 2023, 2022 and 2021, respectively, related to derivatives that are not designated as hedging instruments.

The Company recognized income of $ 26 million, expense of $ 17 million and expense of $ 13 million in other (income) expense, net, during 2024, 2023 and 2022, respectively, related to derivatives that are not designated as hedging instruments.

Gains and losses on these derivatives are generally offset by foreign currency movement in the underlying exposure.

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(1) Represents effective portion recognized in Other Comprehensive Loss (“OCL”).

(2) Portion reclassified from AOCL to income recognized in interest expense, net.

(2) Portion reclassified from AOCL to income recognized in interest expense, net and in loss on extinguishment of debt.

(3) Portion reclassified from AOCL to income recognized in net sales and cost of products sold.

(4) Portion reclassified from AOCL to income recognized in other (income) expense, net.

At December 31, 2023, deferred net losses of approximately $ 13 million within AOCL are expected to be reclassified to earnings over the next twelve months.

At December 31, 2024, deferred net gains of approximately $ 9 million within AOCL are expected to be reclassified to earnings over the next twelve months.

Foreign Currency Operations

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The service cost component of net benefit cost is recorded in cost of products sold and SG&A in the Consolidated Statements of Operations (unless eligible for capitalization) based on the employees’ respective functions.

The other components of net benefit cost are presented separately from service cost within other (income) expense, net in the Consolidated Income Statement.

In 2024, the amount of AOCL expected to be recognized in pension and postretirement benefit (income) expense is an expense of $ 2 million and an income of $ 5 million, respectively.

The other components of net benefit cost are presented separately from service cost within other (income) expense, net in the Consolidated Statements of Operations.

In 2025, the amount of AOCL expected to be recognized related to defined benefit pension and postretirement benefit plans is expense of $ 2 million and income of $ 3 million, respectively.

(Gains)/losses and prior service costs/(credits) are recognized as a component of OCL in the Consolidated Statements of Comprehensive Income (Loss) as they arise.

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These valuations reflect the terms of the plans and use participant-specific information such as compensation, age and years of service, as well as certain assumptions, including estimates of discount rates, expected return on plan assets, rate of compensation increases, interest crediting rates and mortality rates.

The Company has a Supplemental Executive Retirement Plan (“SERP”), which is a nonqualified defined benefit and defined contribution plan pursuant to which the Company will pay supplemental benefits to certain key employees upon retirement based upon the employees’ years of service and compensation.

The SERP is primarily funded through a trust agreement with a trustee that owns life insurance policies on both active and former key employees with aggregate net death benefits of $ 300 million.

At December 31, 2023 and 2022, the life insurance contracts were accounted for using the investment method and had a cash surrender value of $ 141 million, for both periods, and are included in other assets in the Consolidated Balance Sheets.

The Company has supplemental executive retirement plans (“SERPs”), which includes features of both nonqualified defined benefit and defined contribution plans pursuant to which the Company will pay supplemental benefits to certain key employees upon retirement based upon the employees’ years of service and compensation.

The SERPs are primarily funded through a trust agreement with a trustee that owns life insurance policies on both active and former key employees as well as cash and mutual funds.

The life insurance contracts are accounted for using the investment method.

All premiums paid and proceeds received associated with the life insurance policies are included as investing activities in the Consolidated Statements of Cash Flows.

The projected benefit obligation was $ 77 million and $ 81 million at December 31, 2023 and 2022, respectively.

SERP liabilities are included in the pension table hereafter;

The life insurance contracts had a cash surrender value of $ 142 million at December 31, 2024 and $ 139 million at December 31, 2023.

The value of the Company’s investments in the life insurance contracts at their cash surrender value, cash and mutual funds as of December 31, 2024 and 2023, was $ 148 million and $ 141 million, respectively, and is included in other assets in the Consolidated Balance Sheets.

The projected benefit obligation was $ 86 million and $ 95 million at December 31, 2024 and 2023, respectively, and is included in other accrued liabilities in the Consolidated Balance Sheets.

The life insurance policies on both active and former key employees had aggregate net death benefits of $ 258 million as of December 31, 2024.

The SERP liabilities are disclosed in the table hereafter;

however, the value of the Company’s investments in the life insurance contracts, cash and mutual funds are excluded from the table, as they do not qualify as plan assets.

The Company’s matching contributions to the Company’s contributory 401(k) plans were $ 37 million for both 2023 and 2022 and $ 36 million for 2021.

The Company’s matching contributions to the Company’s contributory 401(k) plans were $ 34 million for 2024 and $ 37 million for each of 2023 and 2022.

Defined Benefit Plan

In February 2022, the Company entered into an agreement with an insurance company for a bulk annuity purchase or “buy-in” for one of its U.K.

In January 2024, the Company received a court ruling with respect to determining the benefits certain pensioners related to an international subsidiary were entitled to receive upon converting their defined benefit to a defined contribution.

During the first quarter of 2024, the legal proceeding was concluded and the Company reduced its underlying pension obligation by approximately $ 11 million, with a corresponding offset to AOCL.

In April 2023, the Company completed a “buy-out” of approximately 7 % of the PBO of one of its U.K.

defined benefit pension plans (“U.K.

Plan”), resulting in an exchange of plan assets for an annuity that matches the plan’s future projected benefit obligations (“PBO”) to covered participants.

In April 2023, the Company completed a “buy-out” of approximately 7 % of the U.K.

The “buy-out” was completed by the execution of a Deed Poll Agreement and a Deed of Assignment with an insurance company.

In September 2023, the Company completed the “buy-out” of the remaining PBO of the aforementioned plan through the execution of a Deed Poll Agreement and a Deed of Assignment with an insurance company.

In connection with these transactions, the Company recorded a pretax settlement loss of $ 66 million in other (income) expense, net, in the Company’s Consolidated Statement of Operations, related to the recognition of previously unrecognized actuarial losses reclassified from AOCL to losses.

In connection with these transactions, the Company recorded a pretax settlement loss of $ 66 million in other (income) expense, net, in the Company’s Consolidated Statements of Operations, related to the recognition of previously unrecognized actuarial losses reclassified from AOCL to losses.

Defined Benefit Plan Partial Buyout

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defined benefit pension plans.

The transaction or the transfer of the pension liability to the insurance company will be funded with the plan's existing assets.

In November 2023, the Company completed the “buy-out” and in connection with the transaction, the Company recorded a pretax settlement loss of $ 60 million in other (income) expense, net, in the Company’s Consolidated Statement of Operations, related to the recognition of previously unrecognized actuarial losses reclassified from AOCL to losses.

In November 2023, the Company completed the “buy-out” and in connection with the transaction, the Company recorded a pretax settlement loss of $ 60 million in other (income) expense, net, in the Company’s Consolidated Statements of Operations, related to the recognition of previously unrecognized actuarial losses reclassified from AOCL to losses.

The transaction or the transfer of the pension liability to the insurance company was funded with the plan’s existing assets.

In April 2024, the plan received a refund of approximately $ 7 million from the insurance company as a result of various data changes from the original annuity estimate.

The refund is an asset of the plan.

Defined Benefit Pension Plans

The following provides a reconciliation of benefit obligations, plan assets and funded status of the Company’s noncontributory defined benefit pension plans, including the SERP, at December 31, (dollars in millions):

Pension Benefits Postretirement Benefits

The following provides a reconciliation of benefit obligations, plan assets and funded status of the Company’s qualified noncontributory defined benefit pension plans as well as the Company’s material nonqualified retirement plans including its other postretirement benefit plans and SERPs at December 31, (dollars in millions):

Pension Benefits Postretirement Benefits SERPs

United States International

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Interest cost 29 39 9 15 1 1 4 5

Actuarial gain ( 24 ) ( 247 ) ( 13 ) ( 137 ) ( 2 ) ( 8 )

Actuarial (gain) loss — ( 26 ) ( 4 ) ( 13 ) 2 ( 2 ) ( 2 ) 1

Amendments — — ( 12 ) — — — — —

Currency translation — — ( 10 ) 14 — — — —

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Fair value of plan assets at beginning of year (2)

668 843 176 354 — — — —

Actual return on plan assets 14 57 1 ( 10 ) — — — —

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Fair value of plan assets at end of year (2)

$ 634 $ 668 $ 160 $ 176 $ — $ — $ — $ —

Funded status at end of year $ 36 $ 51 $ ( 48 ) $ ( 68 ) $ ( 25 ) $ ( 26 ) $ ( 86 ) $ ( 95 )

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Ultimate health care cost trend rates — % — % — % — % 4.84 % 4.50 % — % — %

(1) The accumulated benefit obligation for all defined benefit pension plans was $ 1.0 billion and $ 1.4 billion at December 31, 2023 and 2022, respectively.

(1) The accumulated benefit obligation for all defined benefit pension plans was $ 799 million and $ 854 million at December 31, 2024 and 2023, respectively.

The accumulated benefit obligation for the SERPs was $ 86 million and $ 95 million at December 31, 2024 and 2023, respectively.

(2) The preceding table reflects the benefit obligation associated with the Company’s pension benefits including its postretirement benefit plans and the SERPs.

There are no plan assets associated with the Company’s postretirement benefit plans.

The SERPs are primarily funded through a trust agreement with a trustee that owns life insurance policies on both active and former key employees as well as cash and mutual funds.

As of December 31, 2024 and 2023, the value of the Company’s investments in the life insurance contracts at their cash surrender value, cash and mutual funds was $ 148 million and $ 141 million, respectively, which have been excluded from the fair value of plan assets, as they do not qualify as plan assets.

Such asset values exceeded the SERPs obligation by $ 62 million and $ 46 million as of December 31, 2024 and 2023, respectively.

The current healthcare cost trend rate gradually declines through 2038 to the ultimate trend rate and remains level thereafter.

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Fair value of plan assets (1)

(1) The preceding tables reflect the benefit obligation associated with the Company’s nonqualified pension benefits including its postretirement benefit plans and the SERPs.

There are no plan assets associated with the Company’s postretirement benefit plans.

The SERPs are primarily funded through a trust agreement with a trustee that owns life insurance policies on both active and former key employees as well as cash and mutual funds, which are not reflected in the fair value of plan assets above.

Pension and Postretirement Benefit Expense

The components of pension and postretirement benefit expense for the periods indicated are as follows (dollars in millions):

The components of pension, postretirement benefit and SERPs expense for the periods indicated are as follows (dollars in millions):

Pension Benefits

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Long-term rate of compensation increase — % — % — % 2.37 % 2.41 % 2.27 %

Postretirement Benefits

Postretirement Benefits SERPs

2024 2023 2022 2024 2023 2022

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Amortization:

Net actuarial gain ( 6 ) ( 5 ) ( 3 )

Total income $ ( 5 ) $ ( 4 ) $ ( 2 )

Net actuarial (gain) loss ( 5 ) ( 6 ) ( 5 ) — — 1

Total (income) expense $ ( 4 ) $ ( 5 ) $ ( 4 ) $ 4 $ 5 $ 4

Weighted average assumption used to calculate net periodic cost:

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Effective rate for interest on service cost 4.90 % 4.90 % 1.67 % — % — % 2.97 %

The components of net periodic pension and postretirement costs other than the service cost component are included in other (income) expense, net in the Consolidated Statements of Operations.

Long-term rate of compensation increase — % — % — % 3.00 % 3.00 % 3.00 %

The components of net periodic pension, postretirement and SERPs costs other than the service cost component are included in other (income) expense, net in the Consolidated Statements of Operations.

The Company employs a total return investment approach for its pension plans whereby a mix of equities and fixed income investments are used to optimize the long-term return of pension plan assets.

The intent of this strategy is to minimize plan expenses by outperforming plan liabilities over the long run.

Risk tolerance is established through careful consideration of plan liabilities, plan funded status, and the Company’s financial condition.

Risk tolerance is established through careful consideration of plan liabilities,

plan funded status, and the Company’s financial condition.

The domestic investment portfolios contain a diversified blend of equity and fixed-income investments.

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In general, the Company’s target asset allocations are as follows:

equities approximately zero to 20 %;

fixed income approximately 80 % to 100 %;

and cash, alternative investments and other, approximately zero to 10 % at December 31, 2023.

equities approximately 25 %;

fixed income approximately 70 %;

multi-sector fixed-income approximately 5 % and nominal for cash, alternative investments and other at December 31, 2024.

Actual asset allocations may vary from the targeted allocations for various reasons, including market conditions and the timing of transactions.

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Fixed income securities and funds 3 5 — 8 — 8

Cash and other 4 145 10 159 — 159

Cash, insured assets and other 3 131 10 144 — 144

Total $ 10 $ 140 $ 10 $ 160 $ — $ 160

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Fixed income securities and funds 4 6 — 10 — 10

Cash and other 3 140 194 337 — 337

Cash, insured assets and other 4 145 10 159 — 159

Total $ 11 $ 155 $ 10 $ 176 $ — $ 176

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Balance at December 31, 2022 $ 194

Unrealized losses ( 101 )

Purchases, sales, settlements and other, net ( 184 )

Balance at December 31, 2022 194

Purchases, sales, settlements and other, net ( 184 )

Balance at December 31, 2023 $ 10

Balance at December 31, 2024 and 2023 $ 10

Contributions and Estimated Future Benefit Payments

During 2024, the Company expects to make cash contributions of approximately $ 15 million and $ 9 million to its domestic and international defined benefit plans, respectively.

Estimated future benefit payments under the Company’s defined benefit pension plans and postretirement benefit plans are as follows at December 31, 2023 (in millions):

During 2025, the Company expects to make no cash contributions to its domestic defined benefit plan, approximately $ 6 million to its international defined benefit plans, $ 4 million to its other postretirement benefit plans and $ 10 million to its SERPs.

Estimated future benefit payments under the Company’s defined benefit pension plans, other postretirement benefit plans and SERPs are as follows at December 31, 2024 (in millions):

2025 2026 2027 2028 2029 Thereafter

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Postretirement benefits 4 4 3 3 2 9

SERPs 10 10 9 8 8 32

Footnote 12 — Income Taxes

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Non-deductible compensation ( 5.4 ) ( 1.1 ) 1.9

Return to provision 0.6 1.5 ( 11.3 )

Other taxes ( 7.4 ) ( 1.8 ) 4.5

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Other tax credits 2.9 1.8 1.0

Return to provision 1.5 ( 11.3 ) ( 1.7 )

Other ( 5.0 ) ( 1.9 ) 6.6

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(1) The Company accounts for tax on global intangible low-taxed income (“GILTI”) as a period cost and the effects are included herein.

(2) Includes $ 64 million, or 24.6 %, income tax benefit as a result of the completion of tax authorities’ examination in the U.S.

for the years 2011 to 2015 and Brazil for years 2015 to 2017.

At December 31, 2024, the Company has accumulated unremitted earnings generated by our foreign subsidiaries of approximately $ 4.6 billion.

A portion of these earnings were subject to U.S.

federal taxation with the one-time toll charge.

The Company does not assert indefinite reinvestment on a portion of its unremitted earnings of certain foreign subsidiaries as of December 31, 2023 and is recognizing deferred income taxes of approximately $ 12 million, primarily related to the future withholding tax effects of those unremitted foreign earnings.

With respect to unremitted earnings of $ 6.0 billion and any other additional outside basis differences

where the Company is continuing to assert indefinite reinvestment, any future reversals could be subject to additional foreign withholding taxes, U.S.

A portion of these earnings were previously subject to U.S.

federal taxation via various U.S.

foreign inclusion provisions.

The Company does not assert indefinite reinvestment on a portion of its unremitted earnings of certain foreign subsidiaries as of December 31, 2024 and recognized deferred income taxes of approximately $ 13 million, primarily related to the

future withholding tax effects of those unremitted foreign earnings.

With respect to unremitted earnings of $ 4.6 billion and any other additional outside basis differences where the Company is continuing to assert indefinite reinvestment, any future reversals could be subject to additional foreign withholding taxes, U.S.

state taxes and certain tax impacts relating to foreign currency exchange effects on any future repatriations of the unremitted earnings.

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Interest expense carryforward 134 91

Other 122 116

Amortizable intangibles 16 —

Financial instruments — 35

Total gross deferred tax assets 1,091 1,117

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Amortizable intangibles — ( 69 )

Outside basis differences ( 12 ) ( 96 )

Operating lease assets ( 122 ) ( 140 )

Financial instruments ( 10 ) —

Other ( 50 ) ( 47 )

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Net deferred tax assets $ 628 $ 565

At December 31, 2023, the Company has net operating losses (“NOLs”) of approximately $ 1.3 billion, comprised of $ 150 million in the U.S.

At December 31, 2024, the Company has net operating losses (“NOLs”) of approximately $ 1.2 billion, which comprise of $ 150 million in the U.S.

and $ 1.0 billion outside of the U.S.

Approximately $ 794 million of these NOLs do not expire and approximately $ 395 million expire between 2025 and 2044.

During 2023, the Company utilized approximately $ 12 million of U.S.

federal NOLs that were not previously reflected in the consolidated financial statements.

As of December 31, 2023, all U.S.

federal NOLs are reflected in the consolidated financial statements.

At December 31, 2023, the Company has approximately $ 1.3 billion of post-apportioned state NOLs, of which $ 147 million do not expire and $ 1.1 billion expire between 2024 and 2043.

At December 31, 2024, the Company has approximately $ 1.7 billion of post-apportioned state NOLs of which $ 782 million do not expire and $ 964 million expire between 2025 and 2044.

The Company has U.S.

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The Company has approximately $ 139 million of U.S.

capital loss carryforwards of which approximately $ 84 million were generated at December 31, 2020, $ 42 million were generated at December 31, 2021, and can be carried back three years and carried forward five years.

The Company has approximately $ 188 million of post-apportioned state capital loss of which $ 26 million was generated at December 31, 2018, $ 146 million was generated at December 31, 2020, $ 13 million was generated at December 31, 2021 and $ 3 million was generated at December 31, 2022.

capital loss carryforwards of which approximately $ 84 million were generated at December 31, 2020, $ 42 million were generated at December 31, 2021 and $ 13 million were generated at December 31, 2024.

capital loss carryforwards can be carried back three years and carried forward five years.

The Company has approximately $ 192 million of post-apportioned state capital loss carryforwards of which $ 27 million was generated at December 31, 2018, $ 148 million was generated at December 31, 2020, $ 13 million was generated at December 31, 2021 and $ 4 million was generated at December 31, 2022.

Of these post-apportioned state capital loss carryforwards, $ 134 million can be carried back three years and carried forward five years, and $ 58 million can be carried forward five years.

The Company had a noncurrent income tax receivable of $ 311 million and $ 290 million as of December 31, 2024 and 2023, respectively.

In 2023, the Company paid $ 19 million of tax for the one-time toll charge (defined hereafter) incurred in 2017 related

to the Tax Credits and Jobs Act due to the IRS having not yet processed the amended 2017 tax return.

During the year ended December 31, 2022, the Company amended its 2017 U.S.

federal income tax return to carryback foreign tax credits generated in 2018 and capital losses generated in 2018 and 2020.

The Company also paid $ 10 million of tax for the one-time toll charge.

This resulted in an increase in noncurrent income tax receivable of approximately $ 271 million, a decrease in income taxes payable of approximately $ 95 million, and an increase in deferred tax liabilities of approximately $ 356 million.

In 2024, the Company paid $ 25 million of tax for the one-time toll charge incurred in 2017 related to the Tax Credits and Jobs Act as the Internal Revenue Service (“IRS”) has not yet processed the amended 2017 tax return, which the Company filed during the year ended December 31, 2022.

The 2017 U.S.

federal income tax return was amended to carry back foreign tax credits generated in 2018 and capital losses generated in 2018 and 2020.

The Company routinely reviews valuation allowances recorded against deferred tax assets on a more likely than not basis as to whether the Company will realize the deferred tax assets.

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A valuation allowance of $ 171 million and $ 184 million was recorded against certain deferred tax asset balances at December 31, 2024 and 2023, respectively.

For 2024, the Company recorded a net valuation allowance decrease of $ 13 million, primarily related to the utilization of NOLs in Argentina due to improved ongoing operations, the write-off of NOLs, capital losses and corresponding valuation allowances due to liquidation of various subsidiaries in Canada, Luxembourg and Hong Kong, netted with recording additional valuation allowances due to excess interest expense in Luxembourg, as well as other miscellaneous changes in the U.S., state and non-U.S.

valuation allowances related to ongoing operations.

For 2023, the Company recorded a net valuation allowance increase of $ 36 million, primarily related to NOLs in Switzerland, Luxembourg and Argentina and capital losses in Hong Kong, netted with a write-off of NOLs and the related valuation allowance resulting from the liquidation of various subsidiaries in Luxembourg, Netherlands and China, as well as other miscellaneous changes in the U.S., state and non-U.S.

valuation allowances related to ongoing operations.

For 2022, the Company recorded a net valuation allowance decrease of $ 38 million, primarily related to NOLs in Brazil, China and Luxembourg and other miscellaneous changes in the U.S., state and non-U.S.

valuation allowance related to ongoing operations.

The following table summarizes the changes in gross unrecognized tax benefits periods indicated are as follows (in millions):

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Lapse of statute of limitations ( 4 ) ( 6 ) ( 10 )

Cumulative translation adjustments — — ( 1 )

Unrecognized tax benefits, December 31, $ 355 $ 463 $ 476

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The Company recognizes interest and penalties, if any, related to unrecognized tax benefits as a component of income tax expense.

During 2023, 2022 and 2021 the Company recognized income tax expense on interest and penalties of $ 9 million, $ 5 million and $ 7 million, respectively, due to the accrual of current year interest on existing positions offset by the resolution of certain tax contingencies.

The Company anticipates approximately $ 39 million of unrecognized tax benefits will reverse within the next 12 months.

During 2024, the Company recognized an income tax benefit on interest and penalties of $ 12 million, due to the effective settlement of various tax positions under examination by the IRS further described hereafter, and offset by the accrual of current year interest on existing positions.

During 2023 and 2022, the Company recognized income tax expense on interest and penalties of $ 9 million and $ 5 million, respectively, due to the accrual of current year interest on existing positions offset by the resolution of certain tax contingencies.

The Company does not anticipate any material unrecognized tax benefits will reverse within the next 12 months.

It is reasonably possible due to statutes of limitation expiration, as well as activities of various worldwide taxing authorities, including proposed assessments of additional tax and possible settlement of audit issues, that additional changes to the Company’s unrecognized tax benefits could occur.

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The Company’s U.S.

federal income tax returns for 2011 to 2015 and 2017 to 2020, as well as certain state and non-U.S.

federal income tax returns for 2017 to 2020, as well as certain state and non-U.S.

income tax returns for various years, are under examination.

On May 14, 2024, the Company received a Statutory Notice of Deficiency (“Notice”) from the IRS for the tax years 2011 to 2015.

The Company agreed to certain adjustments raised by the IRS in the Notice.

Accordingly, the Company has concluded that various

income tax positions taken by the Company have been effectively settled, with the exception of the matter the Company intends to dispute as further described hereafter.

On July 19, 2024, the Company filed a petition in the U.S.

Tax Court disputing the proposed assessment of $ 80 million in additional taxes plus $ 34 million in penalties plus the additional interest calculated upon final settlement related to the transfer pricing of services performed by certain of the Company’s foreign affiliates for the tax years 2011 to 2015.

The Company believes that adequate amounts have been reserved for any adjustments that may ultimately result.

If the IRS prevails in the assessment of additional tax, interest and penalties in excess of the Company’s current reserves, such outcome could have a material adverse effect on the Company’s financial position and results.

The Company files numerous consolidated and separate income tax returns in the U.S.

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Assets acquired under finance leases are reported in property, plant and equipment, net in the Consolidated Balance Sheets.

The Company did not have finance leases at December 31, 2024 and 2023.

The depreciable life of leasehold improvements and other lease-related assets are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise.

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Operating leases Operating lease assets $ 466 $ 515

Finance leases Property, plant and equipment, net (1)

Total lease assets $ 466 $ 515

Operating leases Other accrued liabilities $ 110 $ 122

Finance leases Short-term debt and current portion of long-term debt — 1

Operating leases Operating lease liabilities 418 446

Finance leases Long-term debt — 1

Total lease liabilities $ 528 $ 568

(1) Net of accumulated depreciation of $ 4 million and $ 18 million, respectively.

In June 2024, as part of optimizing the Company’s real estate footprint, the Company entered into a lease agreement for a new location of its corporate headquarters in Atlanta, Georgia.

Upon control of the leased premises, the Company recorded the lease liability and right of use asset with an initial lease term of 14.5 years.

See Footnote 4 for further information.

Components of lease expense for the years ended December 31, are as follows (in millions):

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(2) Consists primarily of additional payments for non-lease components, such as maintenance costs, payments of taxes and additional rent based on a level of the Company’s retail store sales.

Remaining lease term and discount rates at December 31, are as follows:

Remaining lease term and discount rates for operating leases at December 31, are as follows:

Weighted-average remaining lease term (years) 7 7

Operating leases 7 8

Finance leases 0 1

Weighted-average discount rate 5.1 % 4.3 %

Operating leases 4.3 % 4.6 %

Finance leases — % 0.8 %

Supplemental cash flow information related to leases for the years ended December 31, are as follows (in millions):

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Operating cash flows from operating leases $ 158 $ 162 $ 160

Financing cash flows from finance leases — 3 4

Right of use assets obtained in exchange for lease liabilities:

Operating leases 76 46 135

Maturities of lease liabilities at December 31, 2023, are as follows (in millions):

Maturities of operating lease liabilities at December 31, 2024, are as follows (in millions):

Thereafter 207

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Diluted weighted-average shares outstanding 415.5 414.1 417.4

(1) For 2023, 1.5 million potentially dilutive share-based awards were excluded as their effect would be anti-dilutive.

At December 31, 2023 and 2022, there were 0.8 million and 0.1 million potentially dilutive restricted stock awards with performance-based targets that were not met and as such, have been excluded from the computation of diluted earnings per share.

At December 31, 2021, there were no potentially dilutive restricted stock awards with performance-based targets that were not met.

(1) For 2024 and 2023, 3.4 million and 1.5 million, respectively, potentially dilutive share-based awards were excluded as their effect would be anti-dilutive.

At December 31, 2024, 2023 and 2022, there were 0.7 million, 0.8 million and 0.1 million, respectively, potentially dilutive restricted stock awards with performance-based targets that were not met and as such, have been excluded from the computation of diluted earnings per share.

For 2024, 2023 and 2022 dividends and equivalents for share-based awards expected to be forfeited did not have a material impact on net income for basic and diluted earnings per share.

Share Repurchase Program

On February 6, 2022, the Company’s Board of Directors authorized a $ 375 million Share Repurchase Program (“SRP”), effective through its expiration date of December 31, 2022.

Under the SRP, the Company may purchase its common shares in the open market, in negotiated transactions or in other manners, as permitted by federal securities laws and other legal requirements.

On February 6, 2022, the Company’s Board of Directors authorized a $ 375 million Share Repurchase Program (“SRP”), which expired on December 31, 2022.

Under the SRP, the Company was able to purchase its common shares in the open market, in negotiated transactions or in other manners, as permitted by federal securities laws and other legal requirements.

On February 25, 2022, the Company repurchased $ 275 million of its shares of common stock beneficially owned by Carl C.

Icahn and certain of his affiliates, at a purchase price of $ 25.86 per share, the closing price of the Company’s common shares on February 18, 2022.

During the three months ended June 30, 2022, the Company repurchased approximately $ 50 million of its shares of common stock at an average purchase price of $ 22.01 per share.

In April 2022, the Company repurchased approximately $ 50 million of its shares of common stock at an average purchase price of $ 22.01 per share.

No further repurchases were made prior to the expiration of the SRP.

Footnote 15 — Share-Based Compensation

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The Company estimates future forfeiture rates based on its historical experience.

On May 19, 2023, the Company adopted the 2023 Special Incentive Program (the “SIP”) to incentivize performance against multi-year goals and to aid in the retention of certain Company executives.

On July 5, 2023, pursuant to the SIP, the Company granted performance-based restricted stock unit awards to the Company’s President and Chief Executive Officer (“CEO”) and the Company’s Chief Financial Officer (“CFO”) that vest on February 28, 2026, subject to the achievement of the applicable performance measures.

On the same date, the Company granted time-based and performance-based restricted stock unit awards to certain key executives, other than the CEO and CFO, pursuant to the SIP.

The time-based restricted stock units granted to such other executives pursuant to the SIP will fully vest on the one-year anniversary of the date of grant, while the performance-based restricted stock units granted to such other executives pursuant to the SIP will vest 70 % on the two-year anniversary of the grant date and 30 % on the three-year anniversary of the grant date, subject to the achievement of applicable performance measures.

The Company maintains a 2013 Incentive Plan and a 2022 Incentive Plan (collectively, the “Incentive Plans”), which allow for grants of stock-based awards.

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Stock Options

During 2024, the Company did not award stock options.

In years in which the Company has elected to grant stock options, it has issued them at exercise prices equal to the Company’s common stock price on the date of grant with contractual terms of ten years .

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Outstanding at December 31, 2023 6.6 $ 22

Granted 0.5 13

Exercised — —

Forfeited ( 0.5 ) 24

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Options exercisable, end of year 5.3 $ 22 5.6 $ 0

During 2023, the Company awarded 0.5 million time-based stock options with an aggregate grant date fair value of $ 2 million.

These stock options entitle recipients to purchase shares of the Company’s common stock at an exercise price equal to the fair market value of the underlying shares as of the grant date and cliff vest on the fifth anniversary of the grant date for certain awards or the earlier of the first anniversary of the grant date or the date immediately preceding the Company’s 2024 annual meeting of shareholders for other awards.

The weighted average assumptions used to determine the fair value of stock options granted for the years ended December 31, are as follows:

Expected life in years 7 6

Risk-free interest rate 3.6 % 1.9 %

Expected volatility 42.1 % 42.0 %

Expected dividend yield 4.4 % 5.1 %

The total intrinsic value of options exercised was immaterial in 2023 and 2022 and $ 2 million in 2021.

Time-Based and Performance-Based Restricted Stock Units

Time-based restricted stock unit awards (“Time-Based RSUs”), including such awards granted under the SIP, represent the right to receive unrestricted shares of stock based on continued employment and are generally subject to forfeiture if employment terminates prior to the vesting date, except a termination for death, disability or retirement.

Time-based restricted stock unit awards (“Time-Based RSUs”) represent the right to receive unrestricted shares of stock based on continued employment and are generally subject to forfeiture if employment terminates prior to the vesting date, except a termination for death, disability or retirement.

Time-Based RSU awards to employees primarily vest over a one to three-year period.

In the case of retirement (as defined in the award agreement), Time-Based RSUs generally vest in part depending on the employee’s age and years of service.

In the case of retirement (as defined in the award agreement), Time-Based RSUs generally vest in part.

Time-Based RSUs have dividend equivalents credited to the recipient that are paid only to the extent the applicable service criteria is met, the Time-Based RSUs vest and the related stock is issued.

Performance-based restricted stock unit awards (“Performance-Based RSUs”), including such awards granted under the SIP, represent the right to receive unrestricted shares of stock based on continuous employment plus the achievement of Company performance objectives and/or individual performance goals established by the Compensation and Human Capital Committee of the Board of Directors.

Performance-based restricted stock unit awards (“Performance-Based RSUs”) represent the right to receive unrestricted shares of stock based on continuous employment plus the achievement of Company performance objectives and/or individual performance

goals established by the Compensation and Human Capital Committee of the Board of Directors.

Such awards are generally subject to forfeiture if employment terminates prior to vesting, except a termination for death, disability or retirement.

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Outstanding at December 31, 2024 14.9 $ 11

Expected to vest, end of year 12.5 $ 12

Expected to vest as of December 31, 2024 (2)

(1) The grant adjustment primarily relates to an adjustment in the quantity of Performance-Based RSUs ultimately vested during 2024 that were dependent on the level of achievement of the specified performance conditions.

(2) The difference between the outstanding restricted stock units at December 31, 2024 and the restricted stock units expected to vest as of December 31, 2024 primarily relates to the expected achievement of the specified performance conditions for the respective outstanding Performance-Based RSUs.

The weighted-average grant-date fair values of awards granted were $ 8 , $ 11 and $ 26 per share in 2024, 2023 and 2022, respectively.

The fair values of awards that vested were $ 20 million, $ 13 million and $ 39 million in 2024, 2023 and 2022, respectively.

During 2023, the Company awarded 4.4 million Time-Based RSUs, which had an aggregate grant date fair value of $ 54 million, that generally vests in annual installments over a one to three-year period.

During 2023, the Company also awarded 6.1 million Performance-Based RSUs with an aggregate grant date fair value of $ 62 million, that generally entitle the recipients to shares of the Company’s common stock over a two to three-year vesting period.

During 2024, the Company awarded 5.9 million Time-Based RSUs, which had an aggregate grant date fair value of $ 45 million.

These Time-Based RSUs entitle recipients to shares of the Company’s common stock and vest primarily in annual installments over a three-year period, subject to continued employment.

During 2024, the Company also awarded 1.7 million Performance-Based RSUs with an aggregate grant date fair value of $ 13 million.

These Performance-Based RSUs entitle the recipients to shares of the Company’s common stock and vest primarily at the end of a three-year period, subject to continued employment.

The actual number of shares that will ultimately be paid upon vesting is dependent on the level of achievement of the specified performance conditions.

On May 19, 2023, the Company adopted the 2023 Special Incentive Program (the “SIP”) to incentivize performance against multi-year goals and to aid in the retention of certain Company executives.

On the same date, the Company granted time-based and performance-based restricted stock unit awards to certain key executives, other than the CEO and CFO, pursuant to the SIP.

The time-based restricted stock units granted to such other

executives pursuant to the SIP will fully vest on the one-year anniversary of the date of grant, while the performance-based restricted stock units granted to such other executives pursuant to the SIP will vest 70 % on the two-year anniversary of the grant date and 30 % on the three-year anniversary of the grant date, subject to the achievement of applicable performance measures.

The following table summarizes the Company’s total unrecognized compensation cost related to stock-based compensation at December 31, 2024:

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Stock options 1 1

Excess tax benefits (detriments) related to stock-based compensation for 2023, 2022 and 2021 were $( 2 ) million, $ 2 million and $ 1 million, respectively.

Excess tax detriments related to stock-based compensation was $ 5 million for 2024, $ 2 million for 2023 and benefit of $ 2 million for 2022.

Footnote 16 — Fair Value Disclosures

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Recurring Fair Value Measurements

The Company’s financial assets and liabilities adjusted to fair value at least annually are its money market fund investments included in cash and cash equivalents, its mutual fund investments included in other assets, and its derivative instruments, which are primarily included in prepaid expenses and other, other assets, other accrued liabilities and other noncurrent liabilities.

The Company’s financial assets and liabilities adjusted to fair value at least annually are its money market fund investments included in cash and cash equivalents, its mutual fund investments included in other assets, and its derivative instruments, which are primarily included in prepaid expenses and other current assets, other assets, other accrued liabilities and other noncurrent liabilities.

The following tables present the Company’s non-pension financial assets and liabilities, which are measured at fair value on a recurring basis (in millions):

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Other investment securities are primarily comprised of money market accounts that are classified as Level 2.

The Company determines the fair value of its derivative instruments using standard pricing models and market-based assumptions for all significant inputs, such as yield curves and quoted spot and forward exchange rates.

The Company determines the fair value of its derivative instruments using standard pricing

models and market-based assumptions for all significant inputs, such as yield curves and quoted spot and forward exchange rates.

Accordingly, the Company’s derivative instruments are classified as Level 2.

During 2019, the Company acquired an equity investment for $ 18 million, which is traded on an active exchange and therefore has a readily determinable fair value.

At December 31, 2023, the fair value of the equity investment was $ 12 million.

For equity investments with readily determinable fair values, the Company recorded unrealized immaterial gain for 2023, $ 1 million and $ 2 million gain for 2022 and 2021, respectively, within other (income) expense, net in the Consolidated Statement of Operations.

In 2019, the Company acquired an equity investment in a publicly traded Asian writing business, which is traded on an active exchange and therefore has a readily determinable fair value.

During the third quarter of 2024, the Company sold all its equity interest in the open market for proceeds of approximately $ 11 million and recorded a loss of approximately $ 2 million within other (income) expense, net in the Consolidated Statement of Operations for the twelve months ended December 31, 2024.

The Company adjusts its pension asset values to fair value on an annual basis (See Footnote 11 ).

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The Company’s goodwill and indefinite-lived intangibles are fair valued using discounted cash flows.

Goodwill impairment testing requires significant use of judgment and assumptions including the identification of reporting units;

Quantitative goodwill impairment testing requires significant use of judgment and assumptions including the identification of reporting units;

the assignment of assets and liabilities to reporting units;

and the estimation of future cash flows, business growth rates, terminal values and discount rates.

The testing of indefinite-lived intangibles under established guidelines for impairment also requires significant use of judgment and assumptions, such as the estimation of cash flow projections, terminal values, royalty rates, contributory cross charges, where applicable, and discount rates.

Quantitative testing of indefinite-lived intangibles under established guidelines for impairment also requires significant use of judgment and assumptions, such as the estimation of cash flow projections, terminal values, royalty rates, contributory cross charges, where applicable, and discount rates.

Accordingly, these fair value measurements fall in Level 3 of the fair value hierarchy.

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Indefinite-lived intangibles $ 216 $ 544

At December 31, 2023 and 2022, goodwill and intangible assets of certain reporting units are recorded at fair value based upon the Company’s impairment testing.

At December 31, 2024 and 2023, intangible assets of certain reporting units are recorded at fair value based upon the Company’s impairment testing.

The most significant unobservable inputs (Level 3) used to estimate the fair values of the Company’s reporting unit goodwill and indefinite-lived intangible assets are discount rates, which range from 7.5 % to 9.5 % for reporting unit goodwill and 7.5 % to 12.0 % for indefinite-lived intangible assets.

During the fourth quarter of 2023, two tradenames in the Home and Commercial Solutions segment were measured at fair values of $ 491 million and $ 53 million.

During the fourth quarter of 2022, two tradenames within the Home and Commercial Solutions segment and one in the Learning and Development segment were measured at fair values of $ 68 million, $ 25 million and $ 36 million, respectively.

During the fourth quarter of 2024, one tradename in the Home and Commercial Solutions segment was measured at a fair value of $ 216 million.

During the fourth quarter of 2023, two tradenames within the Home and Commercial Solutions segment were measured at fair values of $ 491 million and $ 53 million.

See Footnotes 1 and 7 for further information.

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Footnote 17 — Segment Information

Effective January 1, 2023, as a result of the implementation of a new operating model intended to drive further simplification and unlock additional efficiencies and synergies within the Company, the CODM now reviews the businesses as three operating segments:

Home and Commercial Solutions, Learning and Development and Outdoor and Recreation.

The Home and Commercial Solutions operating segment represents the combination of the previously reported Commercial Solutions, Home Appliances and Home Solutions operating segments.

Prior period comparable results have been reclassified to conform to the operating segment change.

On March 31, 2022, the Company sold its CH&S business unit to Resideo Technologies, Inc.

The results of operations for CH&S continued to be reported in the Consolidated Statements of Operations as part of the Home and Commercial Solutions segment through March 31, 2022.

The Company’s three primary operating segments are as follows:

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(1) and Ball®, TM of Ball Corporation, used under license.

During 2023, the Company implemented a new operating model intended to drive further simplification and unlock additional efficiencies and synergies within the Company.

In connection with the new operating model, the President and Chief Executive Officer of the Company, who is the CODM reviews the businesses as three operating segments:

Home and Commercial Solutions, Learning and Development and Outdoor and Recreation.

This structure reflects the manner in which the CODM regularly assesses information for decision-making purposes, including the allocation of resources.

The Company also provides general corporate services to its segments which is reported as a non-operating segment, Corporate.

The Company’s segment and geographic results are as follows at and for the years ended December 31, (in millions):

2023 2022 2021

The CODM evaluates the segments’ operating performance based on segment operating income, defined as net sales minus cost of products sold, segment SG&A (including share-based compensation at target for operating segment employees) and other segment costs.

Segment SG&A includes an allocation of center-led corporate functions including the bonus for such corporate functions based on achieving a 100 % of the respective target.

However, the allocation of center-led corporate functions does not include share-based compensation related to such functions.

Any variability in expense from such targets, favorable or unfavorable, is retained at corporate, which would be reflected as a corporate expense.

The CODM considers budget-to-current forecast and prior actuals-to-current forecast variances for segment operating income on a periodic basis for evaluating performance of each segment and making decisions about allocating capital and other resources to each segment.

The Company’s segment results are as follows (in millions):

Year Ended December 31, 2024

Consolidated Home and Commercial Solutions Learning and Development Outdoor and Recreation

Net sales (1)

Home and Commercial Solutions (3)

$ 7,582 $ 4,071 $ 2,717 $ 794

Learning and Development 2,706 2,950 3,028

Outdoor and Recreation 999 1,315 1,484

$ 8,133 $ 9,459 $ 10,589

Cost of products sold 5,034 2,856 1,537 641

Segment SG&A 1,791 933 623 235

Other segment costs (2)

Segment operating income (loss) $ 385 $ ( 2 ) $ 473 $ ( 86 )

Corporate expenses (3)

Operating income 67

Interest expense, net 295

Loss on extinguishment and modification of debt 14

Other expense, net 18

Loss before income taxes $ ( 260 )

Year Ended December 31, 2023

Consolidated Home and Commercial Solutions Learning and Development Outdoor and Recreation

Net sales (1)

$ 8,133 $ 4,428 $ 2,706 $ 999

Operating income (loss) (2)

Home and Commercial Solutions (3)

Cost of products sold 5,780 3,347 1,613 820

Segment SG&A 1,766 916 621 229

Other segment costs (2)

420 128 259 33

Learning and Development 213 593 600

Outdoor and Recreation ( 83 ) 86 90

Corporate ( 252 ) ( 155 ) ( 243 )

Segment operating income (loss) $ 167 $ 37 $ 213 $ ( 83 )

Corporate expenses (3)

Operating loss ( 85 )

Interest expense, net 283

Other expense, net 175

Loss before income taxes $ ( 543 )

Year Ended December 31, 2022

Consolidated Home and Commercial Solutions (3)

Learning and Development Outdoor and Recreation

Net sales (1)

$ 9,459 $ 5,194 $ 2,950 $ 1,315

Cost of products sold 6,625 3,920 1,740 965

Segment SG&A 1,879 1,037 583 259

Other segment costs (2)

Segment operating income (loss) $ 467 $ ( 212 ) $ 593 $ 86

Corporate expenses (3)

Operating income 312

Interest expense, net 235

Loss on extinguishment and modification of debt 1

Other income, net ( 81 )

Income before income taxes $ 157

(1) All intercompany transactions have been eliminated.

(2) Other segment costs primarily include segment restructuring costs, net and non-cash impairment of goodwill, intangibles and other assets (see Footnotes 4 and 7, respectively for further information).

(3) Corporate expenses primarily include costs of operating as a public company including retained costs of center-led corporate functions, corporate restructuring and restructuring-related costs (see Footnote 4 for further information) and non-cash impairment of corporate assets.

In addition, corporate expense includes adjustments, favorable or unfavorable, between the actual bonus achieved versus the bonus at target for center-led corporate functions, as well as adjustments, favorable or unfavorable, between the actual share-based compensation achieved versus the share-based compensation at target for operating segment employees.

Incentive compensation recorded in corporate expenses increased by $ 85 million in 2024 as compared to 2023 and $ 93 million in 2023 as compared to 2022, primarily due to improved performance relative to targets under the Company’s Management Bonus Plan and increases in the expected achievements of the specified performance conditions in the Company’s respective outstanding Performance-Based RSUs (see Footnote 15 for further information).

(4) Home and Commercial Solutions segment includes the results of operations for CH&S business through March 31, 2022, which was subsequently divested (see Footnote 2 for further information).

Depreciation and amortization by segment are as follows for the years ended December 31, (in millions):

2024 2023 2022

Depreciation and amortization

Home and Commercial Solutions $ 153 $ 163 $ 145

$ 163 $ 145 $ 169

Learning and Development 70 71 60

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$ 323 $ 334 $ 296

2023 2022 2021

Impairment of goodwill and intangible assets

Home and Commercial Solutions (3)

$ 76 $ 444 $ 29

Learning and Development 241 30 31

Outdoor and Recreation 22 — —

$ 339 $ 474 $ 60

(1) Corporate depreciation and amortization is allocated to the segments on a percentage of sales basis, and the allocated depreciation and amortization are included in the segment operating income (loss).

Capital expenditures by segment are as follows for the years ended December 31, (in millions):

2024 2023 2022

Capital expenditures

Home and Commercial Solutions $ 96 $ 93 $ 107

$ 93 $ 107 $ 131

Learning and Development 48 60 70

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$ 259 $ 284 $ 312

Assets by segment are as follows at (in millions):

December 31, 2024 December 31, 2023

Segment assets

Home and Commercial Solutions $ 4,110 $ 4,713

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$ 11,004 $ 12,163

Geographic area information

The Company’s geographic net sales (1) (2) are as follows for the years ended December 31, (in millions):

2024 2023 2022

Net Sales (1) (4)

United States $ 4,732 $ 5,129 $ 6,144

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(1) All intercompany transactions have been eliminated.

(2) Operating income (loss) by segment is net sales less cost of products sold, SG&A, restructuring and impairment of goodwill, intangibles and other assets.

Certain headquarters expenses of an operational nature are allocated to business segments primarily on a net sales basis.

Corporate depreciation and amortization is allocated to the segments on a percentage of sales basis, and the allocated depreciation and amortization are included in segment operating income (loss).

(3) Home and Commercial Solutions net sales, operating income, depreciation and amortization, capital expenditures and segment assets exclude the CH&S business as a result of the sale of this business starting from the end of the first quarter of 2022.

(2) Geographic sales information is based on the region from which the products are shipped and invoiced.

Long-lived assets by geography are not presented because it is impracticable to do so.

The Company’s largest customer, Walmart Inc.

and subsidiaries (“Walmart”), accounted for approximately 15.0 %, 14.0 % and 15.0 % of net sales in 2023, 2022 and 2021, respectively.

Amazon, the Company’s second largest customer, accounted for approximately 13.0 % of net sales in each of 2023, 2022 and 2021.

The following table disaggregates revenue by major product grouping source and geography for the years ended December 31, (in millions):

The Company’s largest customer in 2024, Amazon, accounted for approximately 15 % of net sales in 2024 and 13 % in each of 2023 and 2022.

and subsidiaries (“Walmart”), the Company’s second largest customer in 2024, accounted for approximately 14 %, 15 % and 14 % of net sales in 2024, 2023 and 2022, respectively.

The following table disaggregates net sales (1) by major product grouping source for the years ended December 31, (in millions):

2024 2023 2022

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$ 7,582 $ 8,133 $ 9,459

(1) All intercompany transactions have been eliminated.

Geographic net sales (1) by segment are as follows (in millions):

North America (2)

International (2)

Year Ended December 31, 2024

Home and Commercial Solutions $ 2,644 $ 1,427 $ 4,071

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$ 5,051 $ 2,531 $ 7,582

International

Year Ended December 31, 2023

Home and Commercial Solutions $ 2,942 $ 1,486 $ 4,428

2 unchanged sentences

$ 5,442 $ 2,691 $ 8,133

Year Ended December 31, 2022

Home and Commercial Solutions $ 3,625 $ 1,569 $ 5,194

2 unchanged sentences

$ 6,519 $ 2,940 $ 9,459

(1) All intercompany transactions have been eliminated.

(2) Geographic sales information is based on the region from which the products are shipped and invoiced.

Footnote 18 — Litigation and Contingencies

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In connection with such formal and informal inquiries, the Company receives numerous requests, subpoenas, and orders for documents, testimony and information in connection with various aspects of its activities.

The Company previously disclosed that it had received a subpoena and related informal document requests from the SEC primarily relating to its sales practices and certain accounting matters.

The Company cooperated with the SEC in connection with its investigation and requests for documents, testimony and information.

Since January 2023, the Company had been discussing with the SEC the possibility of reaching a settlement to resolve the investigation, which related to the time period between third quarter of fiscal year 2016 and second quarter of fiscal year 2017.

On September 29, 2023, the Company entered into a settlement with the SEC, which concluded the investigation of the Company.

Under the terms of the settlement, the Company neither admitted nor denied the SEC's findings and agreed to pay a civil penalty of approximately $ 13 million, which did not have a material effect on the Company’s Consolidated Financial Statements.

Further, on June 30, 2021, the Company received a subpoena from the SEC requesting the production of documents related to its disclosure of the potential impact of the U.S.

Treasury and the IRS’s temporary regulations under IRC Section 245A, as enacted by the 2017 U.S.

Tax Reform Legislation and IRC Section 954(c)(6) (the “Temporary Regulations”), as well as the August 21, 2020 finalized versions of the Temporary Regulations .

Securities Litigation

The Company and certain of its current and former officers and directors were named as defendants in a securities class action lawsuit filed in the Superior Court of New Jersey, Hudson County, on behalf of all persons who acquired Company common stock pursuant to the S-4 registration statement and prospectus issued in connection with the April 2016 acquisition of Jarden Corporation (the “Registration Statement”).

The action was filed on September 6, 2018 and was captioned Oklahoma Firefighters Pension and Retirement System v.

Newell Brands Inc., et al ., Civil Action No.

HUD-L-003492-18 (“Oklahoma Firefighters”).

In October 2022, the Company entered into a settlement agreement to resolve the claims asserted in this lawsuit.

Under the settlement, the Company agreed to create a settlement fund of approximately $ 103 million for the benefit of the class, subject to certain exclusions, which was predominantly funded by insurance proceeds.

Both the settlement and the insurance receivable were recorded during the third quarter of 2022.

The amount not funded by available insurance proceeds, which is not material to the Company, was expensed during the third quarter of 2022.

In the fourth quarter of 2022, the Court granted the plaintiff's motion for preliminary approval of the settlement, and the Company and its insurers paid the required amount into the settlement fund.

On February 10, 2023, the Court granted the plaintiff's motion for final approval of settlement.

The deadline to appeal the order granting final approval of the settlement has expired and the settlement is final.

Certain of the Company’s current and former officers and directors were named in shareholder derivative lawsuits.

On October 29, 2018, a shareholder filed a putative derivative complaint, Streicher v.

Polk, et al ., in the United States District Court for the District of Delaware (the “Streicher Derivative Action”), purportedly on behalf of the Company against certain of the Company’s current and former officers and directors.

On October 30, 2018, another shareholder filed a putative derivative complaint, Martindale v.

Polk, et al ., in the United States District Court for the District of Delaware (the “Martindale Derivative Action”), asserting substantially similar claims purportedly on behalf of the Company against the same defendants.

The complaints allege, among other things, violations of the federal securities laws, breaches of fiduciary duties, unjust enrichment, and waste of corporate assets.

The factual allegations underlying these claims are similar to the factual allegations made in the In re Newell Brands, Inc.

Securities Litigation that was previously pending in the United States District Court for the District of New Jersey.

That matter was dismissed by the District Court on January 10, 2020, and the dismissal was affirmed by the United States District Court of Appeals for the Third Circuit on December 1, 2020.

The Streicher Derivative Action and the Martindale Derivative Action were consolidated into a case known as In re Newell Brands Inc.

Derivative Litigation (the “Newell Brands Derivative Action”), which is pending in the United States District Court for the District of Delaware.

On December 30, 2020, two shareholders filed a putative derivative complaint, Weber, et al.

Polk, et al ., also in the United States District Court for the District of Delaware (the “Weber Derivative Action”), purportedly on behalf of the Company against certain of the Company’s current and former officers and directors.

The complaint in the Weber Derivative Action alleged, among other things, breaches of fiduciary duty and waste of corporate assets.

The factual allegations underlying these claims are similar to the factual allegations made in the Newell Brands Derivative Action.

These derivative complaints sought damages and restitution for the Company from the individual defendants, the payment of costs and attorneys’ fees, and that the Company be directed to reform certain governance and internal procedures.

The United States District Court for the District of Delaware stayed the Newell Brands Derivative Action and the Weber Derivative Action.

On January 31, 2023, Plaintiff Streicher voluntarily dismissed herself from the Newell Brands Derivative Action without

On September 5, 2023, the Newell Brands Derivative Action and the Weber Derivative Action were dismissed with prejudice.

On May 26, 2023, Plaintiff Streicher filed a new putative derivative complaint, Streicher v.

Polk, et al ., in the Superior Court of New Jersey, Law Division:

Hudson County (the “New Jersey Derivative Action” and, collectively with the Newell Brands Derivative Action and the Weber Derivative Action, the “Derivative Actions”), purportedly on behalf of the Company against certain of the Company’s current and former officers and directors.

The complaint in the New Jersey Derivative Action alleged breaches of fiduciary duty.

The factual allegations underlying these claims were similar to the factual allegations made in the Newell Brands Derivative Action and the Weber Derivative Action.

On June 7, 2023, Plaintiff Streicher filed a Stipulation of Settlement (the “Stipulation”) and Motion for Preliminary Approval of Settlement in the New Jersey Derivative Action.

The proposed settlement as set forth in the Stipulation provided for, among other things, a full release of the claims that the plaintiffs or any other Company stockholder asserted or could have asserted in the Derivative Actions against any of the defendants named in those actions, in exchange for the Company’s agreement to implement and/or maintain certain corporate governance measures, as more fully described in the Stipulation and Notice of Proposed Derivative Settlement as filed by the Company with the SEC on a Current Report on Form 8-K dated June 29, 2023 (the “Settlement”).

On June 27, 2023, the Superior Court of Hudson County, New Jersey issued an order preliminarily approving the proposed Settlement as set forth in the Stipulation.

On August 25, 2023, the Superior Court of Hudson County, New Jersey approved the Settlement and dismissed the case with prejudice.

Environmental Matters

24 unchanged sentences

In September 2017, the U.S.

EPA announced an allocation process involving roughly 80 Unit 2 General Notice Letter recipients, with the intent of offering cash-out settlements to a number of parties (the “U.S.

EPA Settlement”).

EPA announced an allocation process involving roughly 80 Unit 2 General Notice Letter recipients, with the intent of offering cash-out settlements to a number of parties.

The allocation process has concluded, and the Company Parties were placed in the lowest tier of relative responsibility among allocation parties.

3 unchanged sentences

EPA filed an amended complaint and lodged a modified consent decree.

EPA filed a motion to enter the modified Consent Decree on January 31, 2024.

As of the date of this filing, the Company does not expect

that its allocation in the U.S.

EPA Settlement relating to Unit 2 and Unit 4, if the settlement is finalized, will be material to the Company.

EPA filed a motion to enter the modified consent decree (“Consent Decree”) on January 31, 2024, which the court granted on December 18, 2024.

The Court’s Order entering the Consent Decree has been appealed.

As of the date of this filing, the Company does not expect that its share of payments toward the Consent Decree, if the Consent Decree is upheld following any appellate review, will be material to the Company.

In June 2018, Occidental Chemical Corporation (“OCC”) sued over 100 parties, including the Company Parties, in the U.S.

6 unchanged sentences

In March 2023, the Court granted an unopposed motion to stay the OCC Litigation.

On January 5, 2024, the Court granted a motion to extend the stay pending the Court’s adjudication of the then anticipated, and currently pending, motion to enter the amended Consent Decree embodying the U.S.

EPA Settlement.

On January 5, 2024, the Court granted a motion to extend the stay pending the Court’s adjudication of the then anticipated motion to enter the amended Consent Decree.

At this time, the Company cannot predict the eventual outcome of the OCC Litigation.

13 unchanged sentences

In the year ended December 31, 2022, the Company recorded an immaterial reserve in its Consolidated Financial Statements based on its best estimate of probable loss associated with this matter.

Further, in connection with the Company’s sale of The United States Playing Card Company (“USPC”), Cartamundi, Inc.

In the fourth quarter of 2024, the Buyer and the Company entered into a settlement agreement resolving the dispute, and the lawsuit was dismissed with prejudice.

In connection with the Company’s sale of The United States Playing Card Company (“USPC”), Cartamundi, Inc.

and Cartamundi España, S.L., (the “Buyers”) have notified the Company of their contention that certain representations and warranties in the Stock Purchase Agreement, dated June 4, 2019, were inaccurate and/or breached, and have sought indemnification to the extent that the Buyers are required to pay related damages arising out of a third party lawsuit that was recently filed against USPC.

7 unchanged sentences

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

What changed 10-K

Item 8. Financial Statements and Supplementary Data