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Item 9A. Controls and Procedures

2024-12-16 compared with 2023-12-15 · 47 added, 16 removed, 181 unchanged (26% of the section changed)

Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, we have evaluated the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15(e) under the Securities Exchange Act of 1934 (1934 Act) as of October 31, 2023.

Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that, as of October 31, 2023, the disclosure controls and procedures are effective.

(a) Evaluation of Disclosure Controls and Procedures

It is the responsibility of the management of Quanex Building Products Corporation to establish and maintain adequate disclosure controls and procedures.

Disclosure controls and procedures are defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act that are designed to ensure that information required to be disclosed in our reports filed under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Based on their evaluation as of the end of the period covered by this Annual Report on Form 10-K, our Chief Executive Officer and Chief Financial Officer have concluded that, as of such date, our disclosure controls and procedures were not effective as a result of the material weakness in internal control over financial reporting as described below.

(b) Management’s Annual Report on Internal Control Over Financial Reporting (Revised)

Internal control over financial reporting refers to the process designed by, or under the supervision of, our Chief Executive Officer and Chief Financial Officer, and effected by our Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles, and includes those policies and procedures that:

• pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;

• provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors;

• provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the consolidated financial statements.

Management has used the framework set forth in the report entitled “Internal Control—Integrated Framework” published by the Committee of Sponsoring Organizations (“COSO”) of the Treadway Commission (2013 Framework) to evaluate the effectiveness of its internal control over financial reporting.

Based upon this assessment, management concluded that our internal control over financial reporting was not effective as of October 31, 2024, because of a material weakness in the design and operation of the controls over the preparation and review of the statement of cash flows.

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

We analyzed the impact of this error, and while the value of the corrected amounts are quantitively material on a line-item basis within the Statement of Cash Flow, there were no changes to the Balance Sheet, Income Statement, Statement of Stockholders’ Equity, or Statement of Comprehensive Income.

Additionally, this error related only to the fourth quarter of 2024 results and do not impact prior period results.

Management’s conclusion is that the error was quantitatively material within the “Investing Activities” and “Financing Activities” sections of the statement of cash flows, however, all other aspects of the Company's purchase of Tyman were correctly accounted for, including the reported change in cash, cash equivalents and restricted cash for the period.

( c) Remediation

The Company is committed to remediating the above noted material weakness, and we are in the process of developing and implementing remediation plans to address it.

Actions with respect to the remediation plan are expected to include implementing improved procedures and controls related to our quarterly and annual close processes and enhancement of the quarterly and annual close and reporting checklists.

The remediation plan is subject to oversight by the Audit Committee of the Board of Directors and the identified material weakness will not be considered remediated until the remediation plan has been fully implemented, the applicable controls operate for a sufficient period of time, and the Company has concluded that newly implemented controls are operating effectively.

We expect the remediation of this material weakness to be completed prior to the end of fiscal year 2025.

(d) Changes in Internal Control Over Financial Reporting

There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended October 31, 2024 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Management’s Annual Report on Internal Control over Financial Reporting

7 unchanged sentences

Other Information.

During the three months ended October 31, 2023, none of our directors or executive officers adopted or terminated any contract, instruction or written plan for the purchase or sale of our securities to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement.”

During the three months ended October 31, 2024, none of our directors or executive officers adopted or terminated any contract, instruction or written plan for the purchase or sale of our securities to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement,” except as follows:

George Wilson our Chairman, President and CEO , adopted a Rule 10b5-1 trading arrangement on June 11, 2024 .

Under this arrangement, a total of 37,800 shares of our common stock may be sold, subject to certain conditions, before the plan expires on November 30, 2026 .

Directors, Executive Officers and Corporate Governance.

22 unchanged sentences

Name Title Date

/s/ William C.

Griffiths Chairman of the Board December 15, 2023

Davis Director December 16, 2024

8 unchanged sentences

Hughes Director December 16, 2024

/s/ Manish H.

Shah Director December 16, 2024

/s/ Amit Singhi Director December 16, 2024

/s/ George L.

Wilson President and Chief Executive Officer December 15, 2023

Wilson Chairman of the Board, President and Chief Executive Officer December 16, 2024

Wilson (Principal Executive Officer)

22 unchanged sentences

001-33913), as filed with the Securities and Exchange Commission on November 1, 2022 and incorporated herein by reference.

Rule 2.7 Announcement dated as of April 22, 2024, as filed as Exhibit 2.1 to the Registrant’s Current Report on Form 8-K (Reg.

001-33913), as filed with the Securities and Exchange Commission on April 22, 2024, and incorporated herein by reference.

Co-operation Agreement dated as of April 22, 2024, as filed as Exhibit 2.2 to the Registrant’s Current Report on Form 8-K (Reg.

001-33913), as filed with the Securities and Exchange Commission on April 22, 2024, and incorporated herein by reference.

Form of Deed of Irrevocable Undertaking dated as of April 22, 2024, as filed as Exhibit 2.3 to the Registrant’s Current Report on Form 8-K (Reg.

001-33913), as filed with the Securities and Exchange Commission on April 22, 2024, and incorporated herein by reference.

Restated Certificate of Incorporation of the Registrant dated as of March 4, 2016, filed as Exhibit 3.1 of the Registrant’s Current Report on Form 8-K (Reg.

10 unchanged sentences

001-33913) as filed with the Securities and Exchange Commission on July 6, 2022, and incorporated herein by reference.

EXHIBIT INDEX

Exhibit Number Description of Exhibits

Amendment No.1 to the Second Amended and Restated Credit Agreement among the Company (acting as borrower), the Company subsidiaries acting as guarantors thereto, Wells Fargo Bank, National Association as agent, swingline lender and issuing lender, and the other parties thereto, dated as of June 12, 2024, filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (Reg.

001-33913), as filed with the Securities and Exchange Commission on June 12, 2024, and incorporated herein by reference.

Quanex Building Products Corporation Amended and Restated 2008 Omnibus Incentive Plan, filed as Exhibit 10.1 to the Registrant's Current Report on Form 8-K (Reg.

8 unchanged sentences

001-33913), as filed with the Securities and Exchange Commission on March 17, 2008, and incorporated herein by reference.

EXHIBIT INDEX

Exhibit Number Description of Exhibits

Form of Executive Severance Policy applicable to the Registrant and certain of its executive officers, filed as Exhibit 10.1 of the Registrant's current report on Form 8-K (Reg.

16 unchanged sentences

001-33913), as filed with the Securities and Exchange Commission on April 29, 2014, and incorporated herein by reference.

EXHIBIT INDEX

Exhibit Number Description of Exhibits

Form of Restricted Stock Unit Award Agreement for Section 16 Officers under the Quanex Building Products Corporation 2008 Omnibus Incentive Plan, as amended, filed as Exhibit 10.10 to the Registrant’s Current Report on Form 8-K (Reg.

8 unchanged sentences

001-33913), as filed with the Securities and Exchange Commission on December 7, 2015, and incorporated herein by reference.

EXHIBIT INDEX

Exhibit Number Description of Exhibits

Agreement between Quanex Building Products Corporation and Scott Zuehlke, effective November 1, 2019, filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (Reg.

18 unchanged sentences

001-33913), as filed with the Securities and Exchange Commission on November 1, 2019, and incorporated herein by reference.

EXHIBIT INDEX

Exhibit Number Description of Exhibits

Quanex Building Products Corporation 2020 Omnibus Incentive Plan filed as Exhibit 10.2 to the Registrant's Current Report on Form 8-K (Reg.

8 unchanged sentences

001-33913) as filed with the Securities and Exchange Commission on June 5, 2020, and incorporated herein by reference.

EXHIBIT INDEX

Exhibit Number Description of Exhibits

Form of Performance Share Award Agreement for Employees under the Quanex Building Products Corporation 2020 Omnibus Incentive Plan, filed as Exhibit 10.4 of the Registrant’s Quarterly Report on Form 10-Q (Reg.

16 unchanged sentences

Subsidiaries of the Registrant.

EXHIBIT INDEX

Exhibit Number Description of Exhibits

Consent of Grant Thornton LLP.

2 unchanged sentences

Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Quanex Building Products Corporation Clawback Policy.

Quanex Building Products Corporation Clawback Policy filed as Exhibit 97.1 to the Registrant's Annual Report on Form 10-K (Reg.

001-33913) for the year ended October 31, 2023, as filed with the Securities and Exchange Commission on December 1 5 , 2023, and incorporated herein by reference.

*101.INS XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

6 unchanged sentences

† Management Compensation or Incentive Plan

EXHIBIT INDEX

Exhibit Number Description of Exhibits

As permitted by Item 601(b)(4)(iii)(A) of Regulation S-K, the Registrant has not filed with this Annual Report on Form 10-K certain instruments defining the rights of holders of long-term debt of the Registrant and its subsidiaries because the total amount of securities authorized under any of such instruments does not exceed 10% of the total assets of the Registrant and its subsidiaries on a consolidated basis.

1 unchanged sentence

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

What changed 10-K

Item 9A. Controls and Procedures