What changed in this filing

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Item 1A. Risk Factors

2026-03-16 compared with 2025-03-03 · 27 added, 34 removed, 213 unchanged (22% of the section changed)

9 unchanged sentences

We are dependent on several principal customers for a significant percentage of our net sales.

In 2024, our top five customers were PACCAR, Traton, Volvo, Daimler Truck and Ford, which comprised 16%, 13%, 13%, 7% and 7% of our net sales, respectively.

In 2025, our top five customers were Volvo, PACCAR, Traton, Daimler Truck and Ford, which comprised 18%, 15%, 11%, 7% and 6% of our net sales, respectively.

In 2025, our top ten customers accounted for 69% of our net s ales.

19 unchanged sentences

The discontinuation of, the loss of business with respect to or a lack of commercial success of a particular vehicle model for which the Company is a significant supplier, could reduce the Company’s sales and have a material adverse effect on our business, financial condition or results of operations.

Public health crises and other global health pandemics, epidemics or disease outbreaks could adversely impact our business, results of operation and financial condition.

A significant public health crisis, pandemic or disease outbreak could adversely impact our business as well as those of our suppliers and customers.

For example, the COVID-19 pandemic disrupted the global vehicle industry and customer sales, production volumes, supply of components critical to our business, and purchases of commercial, automotive, off-highway and agricultural vehicles by end-consumers.

Any future significant public health crisis could adversely impact the global economy, our industry and the overall demand for our products.

In addition, preventative or reactionary measures taken by governmental authorities may disrupt the ability of our employees, suppliers and other business partners to perform their respective functions and obligations relative to the conduct of our business.

Our ability to predict and respond to future changes resulting from potential health crises is uncertain as are the ultimate potential impacts on our business.

The extent to which a pandemic or similar significant health crises will impact our business in the future is uncertain.

In addition, to the extent such significant health crises may adversely affect our business, financial condition, results of operations and cash flows, they may also have the effect of heightening many of the other risk factors in this section.

Financial Risks

7 unchanged sentences

Our debt obligations could limit our flexibility in managing our business and expose us to risks.

As of December 31, 2024, there was $201.6 million in borrowings outstanding on our Fifth Amended and Restated Credit Agreement (the “Credit Facility”).

As of December 31, 2025, there was $180.9 million in borrowings outstanding on our Fifth Amended and Restated Credit Agreement, as amended (the “Credit Facility”).

In addition, we are permitted under our Credit Facility to incur additional debt, subject to specified limitations.

16 unchanged sentences

• substantially change the nature of our business.

On February 26, 2025, we entered into Amendment No.

1 to the Fifth Amended and Restated Credit Agreement and Waiver ("Amendment No.

On March 6, 2026, the Company entered into Amendment No.

3 to the Fifth Amended and Restated Credit Agreement (“Amendment No.

Amendment No.

1 provides for certain financial covenant relief and additional covenant restrictions during the “Covenant Relief Period” (the period ending on the date that the Company delivers a compliance certificate for the quarter ending December 31, 2025).

During the Covenant Relief Period:

• the maximum leverage ratio of 3.50 was increased to 6.00 for the quarter ended March 31, 2025, 5.50 for the quarter ended June 30, 2025, 4.50 for the quarter ended September 30, 2025 and 3.50 for the quarter ended December 31, 2025;

• the minimum interest coverage ratio of 3.50 was waived for the quarter ended December 31, 2024 and was reduced to 2.00 for the quarters ended March 31 and June 30, 2025, and 2.50 and 3.50 for the quarter ended September 30, 2025 and December 31, 2025, respectively;

• the Company’s aggregate amount of cash and cash equivalents (as defined) cannot exceed $70.0 million;

• the sale of significant assets (as defined) will require repayment in the amount of any net cash proceeds received and result in the reduction of the Credit Facility commitment, at the lesser of $100.0 million or the net cash proceeds;

• there were certain restrictions on Restricted Payments (as defined);

• a Permitted Acquisition (as defined) could not be consummated unless otherwise approved in writing by the required lenders.

3 amends and restates the Credit Facility in its entirety beginning December 31, 2025 and ending at the Credit Facility's amended termination date of July 1, 2027.

Amendment No.

1 added an additional level to the leverage ratio based pricing grid, through maturity, when the leverage ratio is greater than 3.50.

3 also provides for certain covenant relief and adjustments to terms and conditions as follows:

• expiration date of the Credit Facility is extended from November 2, 2026 to July 1, 2027;

• the current minimum interest coverage ratio of 2.50 will be reduced to 1.60 for the quarter ended March 31, 2026, 1.70 for the quarter ended June 30, 2026, 1.75 for the quarter ended September 30, 2026 and 2.50 for the quarter ended December 31, 2026 and thereafter;

• the maximum leverage ratio was increased to 3.75 for the quarter ended December 31, 2025, increases to 6.25 for the quarter ended March 31, 2026, 6.75 for the quarter ended June 30, 2026, 6.00 for the quarter ended September 30, 2026 and 4.00 for the quarter ended December 31, 2026 and thereafter;

• on December 31, 2026, the current borrowing capacity of $175.0 million will be reduced to the lesser of $157.5 million or the then current Credit Facility commitment;

• modifications to Consolidated EBITDA (as defined);

• modifications and additions to affirmative covenants.

Our ability to comply with these covenants as well as the negative covenants under the terms of our indebtedness may be affected by events beyond our control.

13 unchanged sentences

In the past, we have experienced difficulty obtaining adequate supplies of semiconductors, memory chips and other electronic components.

In addition, there have been challenges at times in obtaining timely supply of nylon and resins for our Control Devices segment.

If we cannot obtain adequate amounts of raw materials, components and other supplies, or if we experience an increase in the price of raw materials, components and other supplies, our business, financial condition or results of operations could be materially adversely affected.

5 unchanged sentences

Unanticipated cost increases or the inability to meet certain cost reduction targets may occur as a result of several factors, including increases in the costs of labor, components or materials and operating inefficiencies.

In some cases, we are permitted to pass on to our customers the cost increases associated with specific materials.

In some cases, we are permitted to pass on to our customers the cost increases associated with specific materials or incremental tariffs.

However, cost overruns that we cannot pass on to our customers and the inability to achieve productivity and cost reduction targets could adversely affect our business, financial condition or results of operations.

30 unchanged sentences

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

Military conflicts and geopolitical instability in the Middle East, including U.S.

and Israeli military actions against Iran, could disrupt global markets and adversely affect our business.

Armed conflicts and heightened geopolitical tensions in the Middle East, including ongoing U.S.

and Israeli military operations against Iran, pose risks to the global economy and to our business, even though we do not have direct operations in the region.

A significant escalation of hostilities, including any disruption to the flow of oil through the Strait of Hormuz or other critical shipping lanes, could result in a rapid and sustained increase in global oil and energy prices, which would increase our transportation and logistics costs and the cost of petroleum-based production materials, including resins and certain molded plastic components, used across our manufacturing operations.

Higher energy and fuel prices would also adversely affect our OEM customers and the end markets we serve.

Elevated fuel costs have historically reduced demand for commercial vehicles and off-highway equipment, which are the principal markets for our products and accounted for approximately 95% of our net sales in 2025.

A sustained increase in fuel prices could lead OEM customers to reduce production volumes, delay new vehicle platform launches, or seek additional pricing concessions from their supply base, any of which would have a material adverse effect on our revenues and profitability.

In addition, an escalation of military action in the Middle East could disrupt global shipping routes, increase transit times and freight costs for components and raw materials sourced from Asia and Europe, and create broader supply chain bottlenecks similar to those experienced during prior periods of global disruption.

Our business relies on electronic components sourced globally, including semiconductors, microprocessors, and memory devices, would be particularly vulnerable to such supply chain disruptions.

Any macroeconomic deterioration resulting from an escalation in Middle Eastern hostilities could compound the existing challenges facing our business and could have a material adverse effect on our business, financial condition, results of operations, and liquidity.

Changes in U.S.

2 unchanged sentences

For example, in February 2026, the U.S.

government imposed or threatened to impose new tariffs on imported products from Mexico, Canada and China.

government imposed or threatened to impose new tariffs on imported products.

The impact of these tariffs is subject to a number of factors, including the effective date and duration of such tariffs, changes in the amount, scope and nature of the tariffs in the future, any retaliatory responses to such actions that the target countries may take and any mitigating actions that may become available.

Despite recent trade negotiations between the U.S.

and the Mexican, Canadian and Chinese governments, given the uncertainty regarding the scope and duration of any new tariffs, as well as the potential for additional tariffs or trade barriers by the U.S., Mexico, Canada, China or other countries, we can provide no assurance that any strategies we implement to mitigate the impact of such tariffs or other trade actions will be successful.

and the Mexican, Canadian, Chinese and Brazilian governments, given the uncertainty regarding the scope and duration of any new tariffs, as well as the potential for additional tariffs or trade barriers by the U.S., Mexico, Canada, China, Brazil or other countries, we can provide no assurance that any strategies we implement to mitigate the impact of such tariffs or other trade actions will be successful.

A trade war or other significant changes in trade regulations could have a material adverse effect on our business, financial condition and results of operations.

16 unchanged sentences

Failure to successfully identify, complete and/or integrate acquisitions could have a material adverse effect on us.

A portion of our growth in sales and earnings has been generated from acquisitions and subsequent improvements in the performance of the businesses acquired.

A portion of our growth in sales and earnings has historically been generated from acquisitions and subsequent improvements in the performance of the businesses acquired.

We expect to follow a strategy of selectively identifying and acquiring businesses with complementary products.

4 unchanged sentences

Any failure to successfully integrate such acquisitions could have a material adverse effect on our business, financial condition or results of operations.

If we do not respond appropriately, the evolution of the global transportation industry toward electrification and shared mobility could adversely affect our business.

The global transportation industry is increasingly focused on the development of more fuel-efficient solutions to meet demands from consumers and governments worldwide to address climate change and an increased desire for environmentally sustainable solutions.

The impacts of these changes on us are uncertain and could ultimately prove dramatic.

If we do not respond appropriately, the evolution toward electrification and other energy sources could adversely affect our business.

The increased adoption of electrified and other non-internal combustion-based powertrains may result in lower demand for some of our products.

There has also been an increase in consumer preferences for car and ride sharing, as opposed to automobile ownership, which may result in a long-term reduction in the number of vehicles per capita.

The evolution of the industry toward electrification and shared mobility has also attracted increased competition from entrants outside of the traditional light vehicle industry, some of whom may seek to provide products which compete with ours.

Failure to innovate and to develop or acquire new and compelling products that capitalize upon new technologies in response to these evolving consumer preferences and demands could adversely affect our business, financial condition or results of operations.

Product Liability Risks

68 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 1A. Risk Factors