What changed in this filing

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Item 1A. Risk Factors

2023-02-21 compared with 2022-02-22 · 107 added, 100 removed, 354 unchanged (37% of the section changed)

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Risks Relating to Our Business

The COVID-19 pandemic may have a material negative impact on our business, financial condition, results of operations and cash flows.

Our business and financial results have been and may continue to be negatively impacted by the COVID-19 pandemic and its repercussions.

The severity, magnitude and duration of the current COVID-19 pandemic is uncertain, rapidly changing and hard to predict.

In 2021 and 2020, the COVID-19 pandemic significantly impacted economic activity and markets around the world and our business, and it may negatively impact our business in numerous ways, including but not limited to those outlined below:

• Deteriorating economic and political conditions caused by the COVID-19 pandemic, such as increased unemployment, decreases in capital spending, declines in consumer confidence, or economic slowdowns or recessions, could cause a decrease in demand for our products.

• Due to the impacts of the COVID-19 pandemic, we have experienced and may continue to experience reductions in customer demand for certain products and in certain end-markets.

• Our workforce may be unable or unwilling to work on-site or travel as a result of the continuing pandemic and related vaccine requirements, event cancellations, facility closures, shelter-in-place, travel and other restrictions and changes in industry practice, or if they, their co-workers or their family members become ill or otherwise require care arrangements.

Regulations for vaccines and COVID-19 testing have been announced and additional regulations may be announced in the jurisdictions in which our businesses operate.

Implementation of new regulations for vaccines may result in attrition of professional and skilled labor and impact our ability to attract and retain talent necessary for our business operations.

These measures also may impact our ability to meet production demands or requests and may delay our new product introductions depending on employee attendance or ability to continue to work.

In addition, we have experienced disruptions at some of our facilities with higher absenteeism due to the COVID-19 pandemic.

• If the COVID-19 pandemic continues and economic conditions worsen, we may experience additional adverse impacts on our operational and commercial activities, customer orders and our collections of accounts receivable, which could be material, and it remains uncertain the impact on future operational and commercial activities, customer orders, and collections even if economic conditions improve.

• Government or regulatory responses to the COVID-19 pandemic have and may continue to negatively impact our business.

During 2021 and 2020, mandatory lockdowns or other restrictions on operations in some countries temporarily disrupted our ability to manufacture or distribute our products in some of these markets.

A reoccurrence of these disruptions could materially adversely impact our operations and results.

In addition to existing travel restrictions, jurisdictions may continue to close borders, impose increased vaccine or testing requirements, prolong quarantines and further restrict travel and business activity, and other related supply chain delays may develop, which could significantly impact our ability to support our operations and customers, meet demand, develop new products, ship our backlog and also impact the ability of our employees to get to their workplaces to produce products and services, or significantly hamper our products from moving through the supply chain.

• The impacts of the COVID-19 pandemic may limit our ability to reduce our overall operating costs.

We have experienced increased costs relating to our efforts to mitigate the impact of the COVID-19 pandemic through, among other things, our continued measures taken to protect our employees’ health and well-being.

• The increase in demand as the COVID-19 pandemic has stabilized or waned has disrupted and is expected to continue to disrupt our operations, global supply chain and routes to market and/or those of our suppliers and/or their suppliers.

These disruptions or our failure to effectively respond to them have increased and may continue to increase product, logistics or labor costs, limit availability of raw materials or cause delays in delivering our backlog or may cause an inability to deliver products to our customers or meet customer demand.

• While we have experienced high demand in our pool business as consumers have spent more time at home as a result of the COVID-19 pandemic that contributed to growth in our sales during 2021 and 2020, such growth may not be sustainable and may not be repeated in future periods.

Furthermore, even if growth in demand continues, we may not be able to meet that demand due to supply, production, capacity, and/or labor challenges.

• Disruptions or uncertainties related to the COVID-19 pandemic for a sustained period of time could result in delays or modifications to some of our strategic plans and initiatives and hinder our ability to achieve our growth targets.

• Actions we have taken or may take, or decisions we have made or may make, as a consequence of the COVID-19 pandemic, may result in legal investigations or claims, regulatory actions, or litigation against us.

We may not be able to predict or respond to all impacts of the COVID-19 pandemic on a timely basis to prevent near- or long-term adverse impacts to our results.

Due to the speed with which the COVID-19 situation continues to develop, the global breadth of its spread and the range of governmental and community reactions thereto, there is uncertainty around its duration and severity and ultimate impact, actions taken by parties other than us to respond to the pandemic and the impact of virus variants and the effectiveness of vaccines to address the COVID-19 virus and variants;

therefore, any negative impact on our business, financial condition (including without limitation our liquidity), results of operations and cash flows cannot be reasonably estimated at this time, but the COVID-19 pandemic could lead to extended disruption of economic activity and the impact on our business, financial condition, results of operations and cash flows could be material.

The foregoing and other impacts of the COVID-19 pandemic could have the effect of heightening many of the other risks described below and any of these impacts could materially adversely affect our business, financial condition, results of operations and cash flows.

General global economic and business conditions affect demand for our products.

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We have experienced, and expect to continue to experience, fluctuations in revenues and results of operations due to economic and business cycles.

In particular, during 2021, we had higher than anticipated demand in our pool business and certain of our residential and commercial businesses.

Such demand may not be sustainable and may not be repeated in future periods.

Important factors for our businesses and the businesses of our customers include the overall strength of the global economy and various regional economies and our customers’ confidence in these economies, industrial and governmental capital spending, the strength of residential and commercial real estate markets, residential housing markets, the commercial business climate, unemployment rates, availability of consumer and commercial financing, interest rates, inflation rates, and energy and commodity prices.

In particular, during 2021, we had higher than anticipated demand in our pool business and certain parts of our residential and commercial businesses.

However, such demand in our pool and other residential businesses declined during 2022 and may not be repeated in future periods.

Important factors for our businesses and the businesses of our customers include the overall strength of the global economy and various regional economies and our customers’ confidence in these economies, industrial and governmental capital spending, the strength of residential and commercial real estate markets, residential housing markets, the commercial business climate, global supply chain stability, unemployment rates, availability of consumer and commercial financing, interest rates, inflation rates, and energy and commodity prices.

Recessions, economic downturns, inflation, slowing economic growth and social and political instability in the industries and/or markets where we compete could negatively affect our revenues and financial performance in future periods, result in future restructuring charges, and adversely impact our ability to grow or sustain our business.

For example, current macroeconomic and political instability caused by global supply chain disruptions, inflation, the strengthening of the U.S.

dollar and the conflict between Russia and Ukraine, have and could continue to adversely impact our results of operations.

The businesses of many of our industrial customers are to varying degrees cyclical and have experienced periodic downturns.

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Moreover, demand for our products, which impacts profit margins, is affected by changes in customer order patterns, such as changes in the levels of inventory maintained by customers and the timing of customer purchases, adoption of new technology and connected products, and changes in customers’ preferences for our products, including the success of products offered by our competitors.

Customer purchasing behavior may also shift by product mix in the market or result in a shift to new distribution channels, including e-commerce, which is a rapidly developing area.

If we are unable to continue to differentiate our products, services and solutions or adapt to changes in customer purchasing behavior or shifts in distribution channels, or if we are forced to change prices or to incur additional costs to remain competitive, it could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Customer purchasing behavior may also shift by product mix in the market or result in a shift to new distribution channels.

If we are unable to continue to differentiate our products, services and solutions or adapt to changes in customer purchasing behavior or shifts in distribution channels, or if we are unable to maintain our desired pricing or forced to incur additional costs to remain competitive, it could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Our future growth is dependent upon our ability to transform and adapt our products, services, solutions, and organization to meet the demands of local markets in both developed and emerging economies and by developing or acquiring new technologies that achieve market acceptance with acceptable margins.

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We may experience cost and other inflation.

During 2021, we experienced inflationary cost increases of raw materials, such as metals, resins and electronics (including drives and motors), as well as increases in logistics and labor costs, and we expect inflationary cost increases to continue in 2022.

We strive for productivity improvements and implement increases in selling prices to help mitigate cost increases in raw materials (especially metals, resins and electronics), logistics, energy and other costs including wages, pension, health care and insurance.

We continue to implement operational initiatives in order to mitigate the impacts of this inflation and continuously reduce our costs.

During 2022 and 2021, we experienced inflationary cost increases of raw materials, such as metals, resins and electronics (including drives and motors), as well as increases in logistics, energy, insurance and labor costs (including wages, pension and health care), and we expect inflationary cost increases to continue in 2023.

We strive for productivity improvements and implement increases in selling prices to help mitigate cost increases.

We continue to implement operational initiatives to mitigate the impacts of inflation and continuously reduce our costs.

However, these actions may not be successful in managing our costs or increasing our productivity and we anticipate inflation to continue with respect to materials (especially resins, copper, steel, stainless steel and electronics) as well as labor and logistics.

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Interruption of our supply chain could affect our ability to produce or deliver our products and could negatively impact our business and profitability.

During 2021, we experienced supply chain challenges, including increased lead times for raw materials due to availability constraints and high demand.

During 2022 and 2021, we experienced supply chain challenges, including increased lead times for raw materials due to availability constraints and high demand for these materials.

While we have elevated our engagement with our suppliers and used secondary suppliers and new methods of procurement where available to mitigate the supply chain pressures, we expect supply chain challenges to continue in 2023.

Any material interruption in our supply chain, such as material interruption of the supply of raw materials and components due to the casualty loss of any of our manufacturing plants, interruptions in service by our third-party logistic service providers or common carriers that ship goods within our distribution channels, unexpected delays in shipping or processing through customs of goods, trade restrictions, such as increased tariffs or quotas, embargoes or customs restrictions, or other unexpected or uncontrollable events that cause a material interruption in our supply chain such as pandemics, social or labor unrest, natural disasters or political disputes and military conflicts, could negatively affect our ability to produce or deliver our products and have a negative material impact on our business and our profitability.

Any material interruption in our supply chain, such as material interruption of the supply of raw materials and components due to the casualty loss of any of our manufacturing plants;

interruptions in service by our third-party logistic service providers or common carriers that ship goods within our distribution channels;

unexpected delays in shipping or processing through customs of goods;

trade restrictions, such as increased tariffs or quotas, embargoes or customs restrictions;

or other unexpected or uncontrollable events that cause a material interruption in our supply chain such as pandemics (including COVID-19);

social or labor unrest;

natural disasters or political disputes and military conflicts;

could negatively affect our ability to produce or deliver our products and have a negative material impact on our business and our profitability.

Additionally, our raw materials and components are sourced from a wide variety of domestic and international business partners.

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These issues could have a material adverse effect on our business, financial condition, results of operations and cash flows.

The COVID-19 pandemic may have a material negative impact on our business, financial condition, results of operations and cash flows.

Our business and financial results have been and may continue to be negatively impacted by the COVID-19 pandemic and its repercussions.

The severity, magnitude and duration of the current COVID-19 pandemic remains uncertain, rapidly changing and hard to predict.

In 2022, 2021 and 2020, the COVID-19 pandemic significantly impacted economic activity and markets around the world and our business, and it may negatively impact our business in numerous ways, including but not limited to those outlined below:

• Due to the impacts of the COVID-19 pandemic, we have experienced and may continue to experience reductions in customer demand for certain products and in certain end-markets.

In addition, we have experienced disruptions at some of our facilities with higher absenteeism due to the COVID-19 pandemic.

• Government or regulatory responses to the COVID-19 pandemic have and may continue to negatively impact our business.

Mandatory lockdowns or other restrictions on operations in some countries have previously temporarily disrupted our ability to manufacture in or distribute our products to or from some of these markets.

A reoccurrence of these disruptions could materially adversely impact our operations and results.

These actions could cause related supply chain delays, which could significantly impact our ability to support our operations and customers, meet demand, develop new products, ship our backlog, impact the ability of our employees to get to their workplaces to produce products and services, or significantly hamper our products from moving through the supply chain.

We may not be able to predict or respond to all impacts of the COVID-19 pandemic on a timely basis to prevent near- or long-term adverse impacts to our results.

There still remains much uncertainty around the COVID-19 pandemic and its duration, severity and ultimate impact;

The foregoing and other impacts of the COVID-19 pandemic could have the effect of heightening many of the other risks described herein and any of these impacts could materially adversely affect our business, financial condition, results of operations and cash flows.

We are exposed to political, regulatory, economic, trade, and other risks that arise from operating a multinational business.

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• trade protection measures and import or export licensing requirements and restrictions;

• the possibility of terrorist action affecting us or our operations;

• the possibility of military conflicts or terrorist action affecting us, our operations, supply chains or our end-markets;

• the threat of nationalization and expropriation;

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changes in U.S.

social, political, regulatory and economic conditions or in laws and policies governing foreign trade, manufacturing, development and investment in the territories and countries where we currently purchase, have operations or manufacture and sell products;

or manufacture and sell products;

and any resulting negative sentiments towards the U.S.

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Patents, non-compete agreements, proprietary technologies, customer relationships, trademarks, trade names, and brand names are important to our business.

Intellectual property protection, however, may not preclude competitors from developing products similar to ours or from challenging our names or products.

Our pending patent applications, and our pending copyright and trademark registration applications, may not be allowed, or competitors may challenge the validity or scope of our patents, copyrights or trademarks.

Intellectual property protections, however, may not preclude competitors from developing products similar to ours, or from challenging our names or products.

Our pending patent, copyright, and trademark registration applications, may not be accepted, or competitors may challenge the validity or scope of our patents, copyrights or trademarks.

In addition, our patents, copyrights, trademarks and other intellectual property rights may not provide us a significant competitive advantage.

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Our net sales to our largest customer represented approximately 20% of our consolidated net sales in 2022.

While we do not have any other customers that accounted for 10% or more of our consolidated net sales in 2021, we have other customers that are key to the success of our business.

While we do not have any other customers that accounted for more than 10% of our consolidated net sales in 2022, we have other customers that are key to the success of our business.

Our concentration of sales to a relatively small number of larger customers makes our relationship with each of these customers important to our business.

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Our customers also may be impacted by economic conditions in the industries of those customers, which could result in reduced demand for or a delay in purchases of our products.

In addition, our customers may cancel orders for purchases of our products or may not order products at rates consistent with past order levels.

In addition, our customers may cancel orders for purchases of our products or may not order products at rates consistent with past order levels, including due to inventory rebalancing or corrections in channels.

In addition, we may not be able to timely deliver products to our largest customers due to supply chain interruptions or otherwise.

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Catastrophic and other events beyond our control may disrupt operations at our manufacturing facilities and those of our suppliers, which could cause us to be unable to meet customer demands or increase our costs, or reduce customer spending.

If operations at any of our manufacturing facilities or those of our suppliers were to be disrupted as a result of significant equipment failures, natural disasters, earthquakes, power outages, fires, explosions, terrorism, adverse weather conditions, labor disputes, public health epidemics (including the COVID-19 pandemic) or other catastrophic events or disruptions outside of our control, we may be unable to fill customer orders and otherwise meet customer demand for our products.

If operations at any of our manufacturing facilities or those of our suppliers were to be disrupted as a result of significant equipment failures, natural disasters, earthquakes, power outages, fires, explosions, terrorism, military conflicts, cybersecurity attacks, adverse weather conditions, labor disputes, public health epidemics (including the COVID-19 pandemic) or other catastrophic events or disruptions outside of our control, we may be unable to fill customer orders and otherwise meet customer demand for our products.

In particular, our pool business operations in North Carolina and California are in areas that are more susceptible to natural disasters such as hurricanes, wildfires, and earthquakes.

In addition, these types of events may negatively impact residential, commercial and industrial spending in impacted regions or, depending on the severity, globally.

These types of events may negatively impact residential, commercial and industrial spending in impacted regions or, depending on the severity, global spending.

As a result, any of such events could have a material adverse effect on our business, financial condition, results of operations and cash flows.

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Demand for pool equipment in the pool business within the Consumer Solutions segment and residential water supply, infrastructure and agricultural products in the businesses within the Industrial & Flow Technologies segment follows warm weather trends and is at seasonal highs from April to August.

While historically we have attempted to mitigate the magnitude of the sales spike in the pool business and in the businesses within the Industrial & Flow Technologies segment by employing some advance sale “early buy” programs (generally including extended payment terms and/or additional discounts), we cannot provide any assurance that should we use such programs in the future they will be successful.

While historically we have attempted to mitigate the magnitude of the sales spikes in

the pool business and in the businesses within the Industrial & Flow Technologies segment by employing some advance sale “early buy” programs (generally including extended payment terms and/or additional discounts), we cannot provide any assurance that should we use such programs in the future they will be successful.

In addition, seasonal effects in the pool business and in the businesses within the Industrial & Flow Technologies segment may vary from year to year and be impacted by weather patterns, particularly by temperature, heavy flooding and droughts.

Moreover, adverse weather conditions, such as cold or wet weather, may negatively impact demand for, and sales of, pool equipment in the pool business and residential water supply, commercial, infrastructure and agricultural products in the businesses within the Industrial & Flow Technologies segment.

Our focus on consumer solutions for residential and commercial water treatment as a strategic priority exposes us to certain risks that could have a material adverse impact on our revenue and profitability as well as our reputation.

As we introduce residential and commercial water treatment solutions, we may have limited experience in markets we choose to enter, and our customers may not like our value propositions.

New initiatives we test through trials and pilots may not scale or grow effectively or as we expected, which could limit our growth and negatively affect our operating results.

Designing, marketing and executing these solutions is subject to incremental risks.

These risks include, for example:

• increased labor expense to fulfill our customer promises, which may be higher than the related revenue;

• the requirement to recruit, train and retain qualified personnel;

• increased risk of errors or omissions in the sales or fulfillment of solutions or services;

• unpredictable extended warranty failure rates and related expenses;

• employees in transit using company vehicles to visit customer locations and employees being present in customer homes, which may increase our scope of liability;

• the potential for increased scope of liability relating to our consumer products, services and solutions and related business model, including increased exposure to consumer lawsuits and enforcement actions by governmental authorities;

• increased costs of liability insurance to cover risks associated with performing installation and other services;

• the cyber-security and data protection risks related to the collection and storage of consumer data;

• the engagement of third parties to assist with sales, installation or servicing of our products and solutions, and the potential responsibility for the actions they take;

• increased risk of non-compliance with new laws and regulations applicable to these solutions.

These expanded risks increase the complexity of our business and place significant responsibility on our management, employees, operations, systems, technical expertise, financial resources, and internal controls and compliance functions.

Volatility in currency exchange rates could have a material adverse effect on our financial condition, results of operations and cash flows.

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dollar reported revenue and income will effectively be decreased to the extent of the change in currency valuations, and vice-versa.

During 2022, we experienced a reduction in revenue and profits as a result of the significant strengthening of the U.S.

dollar against foreign currencies.

Fluctuations in foreign currency exchange rates, most notably the strengthening of the U.S.

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Risks Relating to Our Debt and Financial Markets

Increased leverage may harm our business, financial condition and results of operations.

As of December 31, 2022, we had $2,339.3 million of total debt outstanding on a consolidated basis.

Our indebtedness increased materially in connection with our acquisition of Manitowoc Ice, which we funded with approximately $1.6 billion of new indebtedness.

We and our subsidiaries may incur additional indebtedness in the future, subject to restrictions in our debt agreements.

Our increased level of indebtedness and any future increases in our level of indebtedness may have important effects on our future operations, including, without limitation:

• we will have additional cash requirements in order to support the payment of interest on our outstanding indebtedness;

• increases in our outstanding indebtedness and leverage may increase our vulnerability to adverse changes in general economic and industry conditions, as well as to competitive pressure;

• our ability to obtain additional financing for working capital, capital expenditures, general corporate and other purposes may be reduced;

• our flexibility in planning for, or reacting to, changes in our business and our industry may be reduced;

• our flexibility to make acquisitions and develop technology may be limited.

Our ability to make payments of principal and interest on and to refinance our indebtedness, including our existing debt as well as any future debt that we may incur, will depend on our ability to generate cash in the future from operations, financings or asset sales.

Our ability to generate cash is subject to general economic conditions and financial, business and other factors affecting our operations, many of which are beyond our control.

If we are unable to generate sufficient cash flow from operations in the future to service our debt and meet our other cash requirements, we may be required, among other things:

• to seek additional financing in the debt or equity markets;

• to refinance or restructure all or a portion of our indebtedness;

• to sell selected assets or businesses;

• to reduce or delay planned capital or operating expenditures.

Such measures might not be sufficient to enable us to service our debt and meet our other cash requirements.

In addition, any such financing, refinancing or sale of assets might not be available at all or on economically favorable terms.

Covenants in our debt instruments may adversely affect us.

Our credit agreements and indentures contain customary financial covenants, including those that limit the amount of our debt, which may restrict the operations of our business and our ability to incur additional debt to finance acquisitions.

Our ability to meet the financial covenants may be affected by events beyond our control, and we cannot provide assurance that we will meet those tests.

Our ability to

meet the financial covenants may be affected by events beyond our control, and we cannot provide assurance that we will meet those tests.

A breach of any of these covenants could result in a default under our credit agreements or indentures.

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We may increase our debt or raise additional capital, our credit ratings may be downgraded in the future, or our interest rates may increase, each of which could affect our financial condition, and may decrease our profitability.

As of December 31, 2021, we had $894.1 million of total debt outstanding.

As of December 31, 2022, we had $2,339.3 million of total debt outstanding on a consolidated basis.

We may increase our debt or raise additional capital in the future, subject to restrictions in our debt agreements.

If our cash flow from operations is less than we anticipate, if our cash requirements are more than we expect, or if we intend to finance acquisitions, we may require more financing.

However, debt or equity financing may not be available to us on acceptable terms, if at all.

However, debt or equity financing may not be available to us on acceptable terms, or at all.

If we incur additional debt or raise equity through the issuance of additional capital shares, the terms of the debt or capital shares issued may give the holders rights, preferences and privileges senior to those of holders of our ordinary shares, particularly in the event of liquidation.

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To the extent that our interest rates increase, our interest expense will increase, which could adversely affect our financial condition, results of operations and cash flows.

Our leverage could have a material adverse effect on our business, financial condition or results of operations.

Our ability to make payments on and to refinance our indebtedness, including our existing debt as well as any future debt that we may incur, will depend on our ability to generate cash in the future from operations, financings or asset sales.

Our ability to generate cash is subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control.

If we are not able to repay or refinance our debt as it becomes due, we may be forced to sell assets or take other disadvantageous actions, including (i) reducing financing in the future for working capital, capital expenditures and general corporate purposes or (ii) dedicating an unsustainable level of our cash flow from operations to the payment of principal and interest on our indebtedness.

The lenders who hold such debt could also accelerate amounts due, which could potentially trigger a default or acceleration of any of our other debt.

Disruptions in the financial markets could adversely affect us, our customers and our suppliers by increasing funding costs or reducing availability of credit.

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We operate in many parts of the world that are recognized as having governmental and commercial corruption and, in certain circumstances, strict compliance with anti-bribery laws may conflict with local customs and practices.

Because many of our customers and end users are involved in infrastructure construction and energy production, they are often subject to increased regulations and scrutiny by regulators.

We cannot assure that our internal control policies and procedures will always protect us from negligent, reckless or criminal acts committed by our employees or third-party intermediaries.

In the event that we believe or have reason to believe that our employees, customers, or agents have or may have violated applicable anti-corruption laws, including the FCPA, we may be required to investigate the relevant facts and circumstances, which can be expensive and require significant time and attention from senior management.

Violations of these laws may require self-disclosure to government agencies and result in criminal or civil sanctions, which could disrupt our business and result in a material adverse effect on our reputation, business, financial condition, results of operations and cash flows.

Violations of these laws may require self-disclosure to government agencies and result in criminal or civil sanctions, which could disrupt our

business and result in a material adverse effect on our reputation, business, financial condition, results of operations and cash flows.

Our failure to satisfy international trade compliance regulations, and changes in U.S.

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federal, state, local and non-U.S.

laws and regulations governing our environmental practices, public and worker health and safety, and the indoor and outdoor environment.

laws and regulations governing protection of the environment and worker health and safety.

Compliance with these environmental, health and safety regulations could require us to satisfy environmental liabilities, increase the cost of manufacturing our products or otherwise have a material adverse effect on our business, financial condition, results of operations and cash flows.

Any violations of these laws by us could cause us to incur unanticipated liabilities.

We are also required to comply with various environmental laws and maintain permits, many of which are subject to renewal from time to time, for many of our businesses, and we could suffer if we are unable to renew existing permits or to obtain any additional permits that may be required.

We are also required to comply with various environmental laws and maintain permits, many of which are subject to renewal from time to time, for many of our businesses, and we could be adversely impacted if we are unable to renew existing permits or to obtain any additional permits that may be required.

Compliance with environmental requirements also could require significant operating or capital expenditures or result in significant operational restrictions.

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As of December 31, 2022, there were approximately 689 claims pending against our subsidiaries, substantially all of which relate to our discontinued operations.

We cannot predict with certainty the extent to which we will be successful in litigating or otherwise resolving lawsuits in the future, and we continue to evaluate different strategies related to asbestos claims filed against us including entity restructuring and judicial relief.

Unfavorable rulings, judgments or settlement terms could have a material adverse impact on our business and financial condition, results of operations and cash flows.

In addition, while most of the asbestos claims against us are covered by liability insurance policies from many years ago, not all claims are insured.

In addition, while most of

the asbestos claims against us are covered by liability insurance policies from many years ago, not all claims are insured.

As our insurers resolve claims relating to past policy periods, the aggregate coverage provided by those policies erodes.

If we exhaust our coverage under those policies, we will be exposed to potential uninsured losses.

Over time, the uninsured portion of our asbestos docket may increase, which may require us to set greater reserves to resolve future asbestos cases.

Failure to comply with the broad range of standards, laws and regulations in the jurisdictions in which we operate may result in exposure to substantial disruptions, costs and liabilities.

Both our products and the operation of our manufacturing facilities are subject to certain statutory and regulatory requirements.

Our products, manufacturing facilities and business operations are subject to certain statutory and regulatory requirements.

These laws and regulations impose on us increasingly complex, stringent and costly compliance activities, including but not limited to environmental, health, and safety protection standards and permitting, labeling and other requirements regarding (among other things) product efficiency and performance, material makeup, air quality and emissions, and wastewater discharges;

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Similarly, certain countries have adopted the Kyoto Protocol and in February 2021, the U.S.

rejoined the Paris Accord, and these and other existing or potential international initiatives and regulations could affect our international operations.

rejoined the Paris Accord.

These and other existing or potential international initiatives and regulations could affect our international operations.

To the extent our customers, particularly our energy and industrial customers, are subject to any of these or other similar proposed or newly enacted laws and regulations, we are exposed to risks that the additional costs by customers to comply with such laws and regulations could impact their ability or desire to continue to operate at similar levels in certain jurisdictions as historically seen or as currently anticipated, which could negatively impact their demand for our products and services.

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It is uncertain what laws will be enacted and therefore we cannot predict the potential impact of such laws on our future financial condition, results of operations and cash flows.

In addition, as part of our strategy regarding environmental, climate change and sustainability matters, we have set and may set additional targets aimed at reducing our impact on the environment and climate change and/or targets relating to other sustainability matters.

It is possible that we may not be able to achieve such targets or our desired impact, which may cause us to suffer from reputational damage or our business or financial condition could be adversely affected.

It is also possible that actions we take to achieve our strategy or targets could result in increased costs to our operations.

In addition, investors and stakeholders are increasingly focused on ESG matters, and as stakeholder ESG expectations and standards are evolving, our failure to sufficiently respond to these evolving standards and expectations may cause us to suffer from reputational damage and our business or financial condition could be adversely affected.

Increased information technology security threats and computer crime pose a risk to our systems, networks, products and services, and we are exposed to potential regulatory, financial and reputational risks relating to the protection of our data.

The laws and regulations regarding ESG disclosures and requirements are rapidly evolving and could have an adverse effect on our operations and the costs of compliance with, and the other burdens imposed by, these and other laws or regulatory actions may increase our operational costs.

As part of our strategy regarding environmental, climate change and sustainability matters, we have set and may set additional targets aimed at reducing our impact on the environment and climate change and/or targets relating to other sustainability matters.

In addition, as a leading provider of water treatment solutions, our business strategy includes positioning our products and services as sustainable solutions.

Actions we take to achieve our targets or strategy could result in increased costs to our operations.

We may not be able to achieve such targets or our desired impact, and any future investments we make in furtherance of achieving such targets and strategy may not meet investor expectations or standards regarding sustainability performance.

Moreover, we may determine that it is in the best interest of our company and our shareholders to prioritize other business, social, governance or sustainable investments over the achievement of our current targets based on economic, regulatory and social factors, business strategy or pressure from investors or other stakeholders.

In addition, investors and other stakeholders are increasingly focused on ESG matters, and as stakeholder ESG expectations and standards are evolving, we may not be able to sufficiently respond to these evolving standards and expectations.

Furthermore, we could be criticized for the accuracy or completeness of the disclosure of our ESG initiatives.

If we are unable to meet our targets or successfully implement our strategy or our ESG reporting is inaccurate or incomplete, then we could suffer from reputational damage and incur adverse reaction from investors and other stakeholders, which could adversely impact the perception of our brand and our

products and services by current and potential investors and customers, which could in turn adversely impact our business, results of operations, or financial condition.

Increased cybersecurity threats and computer crime pose a risk to our systems, networks, products and services, and we are exposed to potential regulatory, financial and reputational risks relating to the protection of our data.

We rely upon information technology systems and networks in connection with a variety of business activities, some of which are managed by third parties.

As our business increasingly interfaces with employees, customers, dealers and suppliers using information technology systems and networks, we are subject to an increased risk to the secure operation of these systems and networks.

Our evolution into smart products, Internet of Things, business-to-consumer, and e-commerce subjects us to increased cyber and technology risks.

Our evolution into smart products and Internet of Things subjects us to increased cyber and technology risks.

The secure operation of our information technology systems and networks is critical to our business operations and strategy.

Information technology security threats from user error to attacks designed to gain unauthorized access to our systems, networks and data are increasing in frequency and sophistication.

Cybersecurity threats from user error to attacks designed to gain unauthorized access to our systems, networks and data are increasing in frequency and sophistication.

These threats pose a risk to the security of our systems and networks and the confidentiality, availability and integrity of the data we process and maintain.

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We have experienced cybersecurity incidents, and, although we have determined such cybersecurity incidents to be immaterial and such incidents have not had a material adverse effect on our financial condition, results of operations or cash flows, there can be no assurance of similar results in the future.

Should future attacks succeed in the theft of assets, exporting sensitive data or financial information or controlling sensitive systems or networks, it could expose us and our employees, customers, dealers and suppliers to the theft of assets, misuse of information or systems, compromising of confidential information, manipulation and destruction of data, defective products, production downtimes and operations disruptions.

Should future attacks succeed, it could expose us and our employees, customers, dealers and suppliers to the theft of assets, misuse of information or systems, compromises of confidential information, manipulation and destruction of data, product failures, production downtimes and operations disruptions.

The occurrence of any of these events could have a material adverse effect on our reputation, business, financial condition, results of operations and cash flows.

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A variety of state, national, foreign and international laws and regulations apply to the collection, use, retention, protection, security, disclosure, transfer and other processing of personal and other data.

Many foreign data privacy regulations, including the General Data Protection

Regulation (the “GDPR”) in the European Union, are more stringent than federal regulations in the United States.

Many foreign data privacy regulations, including the General Data Protection Regulation (the “GDPR”) in the European Union, are more stringent than federal regulations in the United States.

Within the United States, many states are considering adopting, or have already adopted privacy regulations, including, for example, the California Consumer Privacy Act.

The applicability of these laws to our business has increased due to our focus on expanding business-to-consumer and e-commerce offerings.

These laws and regulations are rapidly evolving and changing, and could have an adverse effect on our operations.

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In the case of non-compliance with these laws, including the GDPR, regulators have the authority to levy significant fines.

In addition, if there is a breach of privacy, we may be required to make notifications under data privacy regulations.

In addition, if there is a breach of privacy, we may be required to make notifications under data privacy laws or regulations, or could become subject to litigation.

The occurrence of any of these events could have a material adverse effect on our reputation, business, financial condition, results of operations and cash flows.

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environmental, asbestos, safety and health matters;

product liability;

the use or installation of our products;

product quality and liability matters;

matters arising from the use or installation of our products;

consumer protection matters;

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The outcome of such legal proceedings cannot be predicted with certainty and some may be disposed of unfavorably to us.

We also may not have insurance that covers such claims.

While we currently maintain what we believe to be suitable product liability insurance, we may not be able to maintain this insurance on acceptable terms, and this insurance may not provide adequate protection against potential or previously existing liabilities.

Insurance coverage is not available for some of our claims and may be disputed by carriers in others.

While we currently maintain what we believe to be suitable product liability insurance, we may not be able to maintain this insurance on our preferred terms or at an acceptable cost, and this insurance may not provide adequate protection against potential or previously existing liabilities.

In addition, we self-insure a portion of product liability claims and must satisfy deductibles on other insured claims.

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The MLI has now entered into force for a number of countries, including Ireland and the U.K.

Under the Double Tax Convention between Ireland and the

U.K., as amended by the MLI, the residence tie-breaker provides that a company will remain dual resident unless there is a determination otherwise by the tax authorities of the two contracting states.

Under the Double Tax Convention between Ireland and the U.K., as amended by the MLI, the residence tie-breaker provides that a company will remain dual resident unless there is a determination otherwise by the tax authorities of the two contracting states.

We have obtained a determination from the Competent Authorities of the Irish Revenue Commissioners and the U.K.

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corporations and shareholders, including, among others, differences relating to interested director and officer transactions and shareholder lawsuits.

Likewise, the duties of directors and officers of an Irish company generally are owed to the company only.

Further, the duties of directors and officers of an Irish company generally are owed to the company only.

Shareholders of Irish companies generally do not have a personal right of action against directors or officers of the company and may exercise such rights of action on behalf of the company only in limited circumstances.

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The person who receives the gift or inheritance has primary liability for CAT.

Gifts and inheritances passing between

spouses are exempt from CAT.

Gifts and inheritances passing between spouses are exempt from CAT.

Children have a tax-free threshold of €335,000 per lifetime in respect of taxable gifts or inheritances received from their parents for periods on or after October 9, 2019.

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

What changed 10-K

Item 1A. Risk Factors