What changed in this filing

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Item 1A. Risk Factors

2026-03-02 compared with 2025-02-27 · 58 added, 33 removed, 242 unchanged (27% of the section changed)

10 unchanged sentences

In the past, our operations have been exposed to volatility due to changes in general economic conditions or consumer preferences, recessions or adverse conditions in the markets we serve, including the impact of global pandemics and international conflicts.

We are exposed to highly cyclical end markets for industrial goods, and to a lesser extent, aerospace and consumer products.

We are exposed to highly cyclical end markets for industrial goods, and to a lesser extent, consumer products.

An uncertain macro-economic and political climate could lead to reduced demand from our customers, variations in timing of sales to our customers, increased price competition for our products, increased risk of excess and obsolete inventories, uncollectible receivables, and higher overhead costs as a percentage of revenue, all of which could impact our operating margins.

If our customers are adversely affected by these factors, we may experience lower product volume orders, which could have an unfavorable impact on our revenue and operating profit.

For example, beginning in the back half of 2022 and continuing through 2023, demand for dispensing and closure products within our Packaging segment fell as a result of some of our larger customers' choices to rebalance on-hand inventory levels and caution in purchasing behaviors given the current inflationary macro-economic environment.

As a more recent example, we experienced strong demand and inventory builds from customers, which benefited our steel cylinder business in 2022 and 2023, which then resulted in customer destocking negatively impacting demand for steel cylinders in 2024.

For example, through 2023, demand for dispensing and closure products within our Packaging segment fell as a result of some of our larger customers' choices to rebalance on-hand inventory levels and caution in purchasing behaviors given the inflationary macro-economic environment at the time.

As a more recent example, following a period of strong demand of our cylinder products and inventory builds from customers, we witnessed a period of customer inventory destocking, which negatively impacted demand for our cylinder products in 2024 and 2025.

These are a few recent examples indicating that our ability to accurately forecast the level of our customers’ orders is limited and can result in inefficiencies in scheduling our installed manufacturing capacity and result in sub-optimal business and financial results.

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We are sensitive to price movements and availability of our raw materials supply.

Our largest raw material purchases are for resins (such as polypropylene and polyethylene), steel, aluminum superalloys (such as titanium, A286 stainless steel and Inconel) and other oil and metal-based purchased components, each of which have experienced recent cost volatility.

Our largest raw material purchases are for resins (such as polypropylene and polyethylene), steel, aluminum, and other oil and metal-based purchased components, each of which have experienced recent cost volatility.

Prices for these products, along with costs for transportation and energy, fluctuate with market conditions, and have generally increased over time.

For example, during 2022, we experienced increased energy costs and supply chain disruptions as a result of the Russia-Ukraine conflict.

In addition, we have experienced, and expect to continue to experience, the impact of cost inflationary pressure on raw materials, wage rates and freight.

For 2024, while our material and other input costs have generally stabilized compared to 2023 levels, we have experienced increased input costs associated with abrupt increases in customer demand, primarily in our Packaging segment.

For example, we have experienced, and expect to continue to experience, the impact of cost inflationary pressure on raw materials, wage rates and freight.

Pressure on wage rates continued through 2025 across all our businesses.

For 2024, while our material and other input costs stabilized compared to 2023 levels, we experienced increased input costs associated with abrupt increases in customer demand, primarily in our Packaging segment.

Although we have generally been able to recover certain costs increases, we may be unable to offset the impact of future cost increases with price increases on a timely basis due to outstanding commitments to our customers, competitive considerations or our customers’ resistance to accepting such price increases and our financial performance could be adversely impacted.

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While no individual customer accounted for 10% or more of our consolidated net sales for 2025, 2024 or 2023, our customer base has become, and may further become, increasingly concentrated as a result of our strategy to focus on growing sales with existing customers in packaging end markets, or due to customer consolidations.

In 2024, our Aerospace and Specialty Products segments each had a customer that comprised 10% or more of its segment revenue.

In 2025, our Packaging segment and Specialty Products segment each had a customer that comprised 10% or more of its segment revenue.

As a result of these factors, changes to or reductions in the buying patterns of these larger customers, including our customers diversifying their supply base, may expose our business and results of operations to greater volatility.

For example, in a prior period, a large commercial aircraft manufacturer announced significant production delays and/or reductions on certain of its platforms for which we provide products, which significantly impacted our sales, profit and production efficiencies compared to historical levels.

The mix and type of customers, and sales to any single customer, may vary significantly from quarter to quarter and from year to year, and have a significant impact on our financial condition, results of operations and cash flows.

If customers do not place orders, or they substantially reduce, delay or cancel orders, we may not be able to replace the business, which may have a significant adverse impact on our results of operations and financial condition.

For example, beginning late 2023 and continuing through 2024, we experienced a significant demand trough in our cylinder business as our customers rebalanced their inventory and adjusted their buying patterns.

Further, a number of our consumer packaged goods customers ordered higher levels of inventory due to concerns over capacity constraints and rising inflation in the first half of 2022, and subsequently reduced their order levels in the back-half of 2022.

Sales of our consumer and industrial packaging products decreased in 2023, which we believe was due to lower customer order activity given high customer stocking levels, as well as continuing uncertainty around consumer sentiment as a result of the inflationary environment.

For example, beginning late 2023 and continuing through early 2025, we experienced a significant demand trough in our cylinder business as our customers rebalanced their inventory and adjusted their buying patterns.

Further, sales of our consumer and industrial packaging products decreased in 2023, which we believe was due to lower customer order activity given high customer stocking levels, as well as continuing uncertainty around consumer sentiment as a result of the inflationary environment.

In addition, major customers may require that we localize manufacturing and supply capacity rather than sourcing from lower cost countries, or seek pricing, payment, intellectual property-related or other commercial terms that are less favorable to us, which may have a negative impact on our business.

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If our manufacturing facilities become unavailable either temporarily or permanently due to weather, earthquakes or other natural disasters related to global climate change, or geopolitical developments, including any potential impacts resulting from tensions between the United States and China, or logistical complications or operational disruptions arising from adverse regulatory actions, acts of war, cybersecurity incidents, public health crises or labor disruptions, we may be unable to shift production to other facilities or to make up for lost production.

For example, our Aerospace manufacturing facilities are predominately located in southern California, an area known for earthquakes and wildfires, and are thus vulnerable to damage.

For example, one of our Specialty Products manufacturing facilities is located in Longview, Texas, an area known for significant precipitation and riverine flooding, and is thus vulnerable to damage.

Any new facility would need to comply with the necessary regulatory requirements, satisfy our specialized manufacturing requirements and require specialized equipment.

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Certain of the agreements related to the acquisition and disposition of businesses require indemnification against certain liabilities related to the operations of the company for the previous owner.

We cannot be assured that any of these indemnification provisions will fully protect us, and as a result we may incur unexpected liabilities that adversely affect our profitability and financial position.

We cannot be assured that any of these indemnification provisions will fully protect us.

In some instances, third parties may have an obligation to indemnify us for liabilities related to a disposed business, and such third parties may be unable to, or fail to, fulfill such obligations.

If such third parties fail to indemnify us, or if indemnification provisions otherwise fail to fully protect us, we may be financially responsible and may incur unexpected liabilities that adversely affect our profitability and financial position.

For example, we completed the spin-off of our legacy Cequent businesses in 2015, creating a new independent publicly traded company, Horizon Global Corporation (“Horizon”).

In connection with the spin-off, we entered into an agreement pursuant to which Horizon agreed to fully indemnify us from, among other things, any and all future damages incurred by us in connection with certain litigation and environmental liabilities relating to our legacy Cequent businesses.

In 2023, First Brands Group, LLC (“First Brands”) acquired Horizon, and subsequently assumed Horizon’s indemnification obligations to us.

First Brands filed for Chapter 11 bankruptcy protection in September 2025.

If First Brands is unable to satisfy its indemnification obligations to us, we may incur unexpected liabilities relating to our legacy Cequent businesses.

Expectations relating to sustainability and ESG considerations could expose us to potential liabilities, increased costs, reputational harm and other adverse effects on our business.

10 unchanged sentences

Free trade laws and regulations provide certain duties and tariffs on qualifying imports and exports, subject to compliance with the applicable classification and other requirements.

The United States government has indicated its intent to alter its approach to international trade policy and in some cases to renegotiate, or potentially terminate, certain existing bilateral or multi-lateral trade agreements and treaties with foreign countries.

Retaliatory tariffs imposed by other countries or other potential governmental actions, could result in further adverse impacts on our business and results of operations.

The United States government has altered its approach to international trade policy and, in some cases, indicated its intent to renegotiate, or potentially terminate, certain existing bilateral or multi-lateral trade agreements and treaties with foreign countries.

For example, in early 2025 the U.S.

government announced baseline tariffs on products from all countries and additional individualized reciprocal tariffs on the countries with which the United States has the largest trade deficits, including China.

Current and future tariffs, including any retaliatory tariffs imposed by other countries, or other potential governmental actions, could result in further adverse impacts on our business and results of operations.

These tariffs, and other governmental actions relating to international trade agreements or policies, the adoption and expansion of trade restrictions, or the occurrence of trade wars may adversely impact demand for our products, costs, customers, suppliers and/or the U.S.

2 unchanged sentences

The degree to which these changes in U.S.

trade policies, or the trade policies of other counties, affect our financial condition and results of operations will be influenced by the specific details of the changes in trade policies, their timing and duration, and our effectiveness in deploying tools and strategies to address these issues.

For example, in the past few years, we have experienced higher input costs as a direct result of tariffs imposed on certain raw materials and components imported from China.

trade policies, or the trade policies of other countries, affect our financial condition and results of operations will be influenced by the specific details of the changes in trade policies, their timing and duration, and our effectiveness in deploying tools and strategies to address these issues.

During 2025, we experienced higher input costs as a direct result of tariffs imposed on certain raw materials and components imported from China.

In certain cases, we have passed-through these incremental costs to the customer, while in some cases we have not changed pricing to retain or expand volume, and in other cases we continue to work to install capacity in facilities where there currently is no tariff.

1 unchanged sentence

suppliers raised prices for components in response to an overall increase in demand for domestic sources.

It remains unclear what the U.S.

or foreign governments will or will not do with respect to tariffs, international trade agreements and policies on a short-term or long-term basis.

There remains uncertainty regarding the scope and duration of these actions by the U.S.

or foreign governments with respect to tariffs, international trade agreements and policies on a short-term or long-term basis.

Additional changes in laws or policies governing the terms of foreign trade, and in particular increased trade restrictions, tariffs or taxes on imports from countries where we manufacture or purchase products could have a material adverse effect on our business, financial condition and results of operations.

3 unchanged sentences

New tax laws and regulations and changes in existing tax laws and regulations could result in increased expenditures by us for tax liabilities in the future and could materially and adversely impact our financial condition, results of operations and cash flows.

We continue to monitor and evaluate legislative developments related to the Global Anti-Base Erosion Proposal ("GloBE") established by the Organization of Economic Cooperation and Development's ("OECD") Pillar Two framework.

We continue to monitor and evaluate legislative developments related to the Global Anti-Base Erosion (“GloBE”) rules under the Organization for Economic Co-operation and Development’s (“OECD”) Pillar Two framework.

The Pillar Two rules establish a global minimum corporate tax rate of 15% for multinational enterprise groups with consolidated revenues of at least €750 million.

OECD member countries may implement the Pillar Two model rules as issued, in a modified form, or not at all.

On December 12, 2022, the European Union member states agreed to implement the OECD's Pillar Two global corporate minimum tax rate of 15% on companies with revenues of at least $790,000, which went into effect in January 2024.

A number of other countries have passed legislation enacting certain parts of the Pillar Two framework in 2024.

While the Pillar Two legislation did not have a material impact on our 2024 consolidated financial statements, it could have a material impact on our effective tax rate and result in higher cash tax liabilities in the future, depending on which countries enact minimum tax legislation and in what manner.

In December 2022, European Union member states adopted a directive to implement Pillar Two, with the income inclusion rule generally effective for fiscal years beginning on or after December 31, 2023, and the undertaxed profits rule effective in subsequent periods.

A number of other jurisdictions have enacted, or are in the process of enacting, legislation implementing aspects of the Pillar Two framework.

While the Pillar Two legislation did not have a material impact on our consolidated financial statements for the year ended December 31, 2025, it could have a material impact on our effective tax rate and result in increased cash tax liabilities in future periods, depending on the jurisdictions in which we operate and the manner in which such rules are implemented.

We continue to assess the impact as guidance evolves, especially the newly side-by-side rules which were published by the OECD in January 2026.

We may face liability associated with the use of products for which patent ownership or other intellectual property rights are claimed.

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The coverage-in-place agreement makes asbestos defense costs and indemnity insurance coverage available to us that might otherwise be disputed by the carriers and provides a methodology for the administration of such expenses.

The Company's primary insurance exhausted in November 2018, and the Company is solely responsible for defense costs and indemnity payments prior to the commencement of coverage under this agreement, the duration of which would be subject to the scope of damage awards and settlements paid.

During this period, we may incur significant litigation costs in defending these matters.

Our primary insurance exhausted in November 2018, and we were solely responsible for defense costs and indemnity payments prior to the commencement of coverage under this agreement.

During second quarter 2025, we reached the threshold of qualified future settlements required to commence excess carrier insurance coverage under the coverage-in-place agreement.

In the event the asbestos defense costs and indemnity insurance coverage provided by the coverage-in-place agreement are unavailable to us for any reason, we may incur additional costs.

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We are subject to variable interest rates on our revolving credit facility.

Such interest rates are subject to benchmark interest rates based on the currency denomination of borrowings, with British pound sterling borrowings subject to the Sterling Overnight Index Average and Euro borrowings subject to the Euro InterBank Offered Rate, both plus a spread of 1.750%, and U.S.

dollar borrowings subject to the Secured Overnight Financing Rate plus a spread of 1.850%.

The interest rate spread is based upon the leverage ratio, as defined, as of the most recent determination date.

Such interest rates are subject to benchmark interest rates based on the currency denomination of borrowings, with British pound sterling borrowings subject to the Sterling Overnight Index Average, Euro borrowings subject to the Euro InterBank Offered Rate and U.S.

dollar borrowings subject to the Secured Overnight Financing Rate, each plus a spread that ranges from 1.375% to 2.00% based upon the leverage ratio, as defined, as of the most recent determination date.

We may experience increases in our interest expense as a result of general increases in interest rate levels.

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We may be subject to further unionization and work stoppages at our facilities or our customers may be subject to work stoppages, which could seriously impact the profitability of our business.

As of December 31, 2024, we have one facility, located in Commerce, California, where our hourly employees operate under a collective bargaining agreement, and which represents 13% of our employees located in the United States.

We have six facilities outside of the United States where our employees are affiliated with state-controlled or trade unions, which covers 13% of our non-U.S.

Our labor agreement with the United Automobile, Aerospace and Agricultural Implement Workers of America (UAW) at our TriMas Aerospace facility in Commerce, California, expired in August 2024, at which time the UAW initiated a strike.

We entered into a new three-year collective bargaining agreement in October 2024.

As of December 31, 2025, we have six facilities outside of the United States where our employees are affiliated with state-controlled or trade unions, which covers 13% of our non-U.S.

We are not aware of any present active union organizing drives at any of our other facilities.

10 unchanged sentences

Additionally, foreign competitors and many domestic competitors provide fewer benefits to their employees, and this difference in cost could adversely impact our competitive position.

Risks Related to the Planned Sale of TriMas Aerospace

The planned sale of TriMas Aerospace may not occur at all or may not occur in the expected time frame, which may negatively affect the trading price of our common stock and our future business and financial results.

Completion of the planned sale of TriMas Aerospace is subject to the satisfaction or waiver of customary and other closing conditions.

The sale is not assured and is subject to risks and uncertainties, including the risk that the necessary regulatory approvals will not be obtained or that other closing conditions will not be satisfied.

We cannot predict whether and when such approvals will be received, or such conditions will be satisfied.

The Purchase Agreement includes customary termination rights for both the Company and the Purchaser, including the right of either party to terminate the agreement if the planned sale of TriMas Aerospace has not been consummated within six months following the execution date of the Purchase Agreement (the “Outside Date”).

The Outside Date may be extended by either party by an additional three-month period under certain conditions.

If the planned sale of TriMas Aerospace is not completed, or if there are significant delays in completing the planned sale, it may negatively affect the trading price of our common stock and our future business and financial results.

We may be unable to achieve some or all of the benefits that we expect to achieve from the planned sale of TriMas Aerospace.

Although we believe that selling TriMas Aerospace will provide financial, operational, managerial and other benefits to us and our shareholders, the planned sale may not provide such results on the scope or scale we anticipate, and we may not realize the assumed benefits of the sale.

In addition, we will incur one-time costs in connection with the sale that may exceed our estimates and negate some of the benefits we expect to achieve.

If we do not realize these assumed benefits, we could suffer a material adverse effect on our financial condition.

Our choices about the use of anticipated net proceeds from the sale of TriMas Aerospace may not be effective.

If the planned sale of TriMas Aerospace is consummated, we expect to receive net after-tax cash proceeds of approximately $1.2 billion.

We plan to use a portion of the anticipated net proceeds from the sale of TriMas Aerospace for acquisitions, and we have established the Strategic Investment Committee (the “Committee”) to evaluate potential acquisitions and additional options for the use of proceeds.

Attractive strategic transaction opportunities may not be identified, and we may be unable to accomplish our strategic objectives in effecting a particular strategic transaction.

While we will have broad discretion in the application of the net proceeds from the planned sale of TriMas Aerospace, we may not be able to recognize the benefits of and effectively deploy such net proceeds and our planned use of proceeds may not yield a significant return or any return at all for our shareholders.

In addition, pending their use, we may invest the net proceeds from the planned sale of TriMas Aerospace in a manner that does not produce income or that loses value.

Our ability to use of net proceeds from the planned sale of TriMas Aerospace is also limited by covenants in our debt instruments.

For example, the indenture governing our senior notes includes certain requirements regarding the use of net proceeds from asset sale transactions.

If we cannot effectively deploy the anticipated net proceeds from the planned sale of TriMas Aerospace, it may negatively affect the trading price of our common stock and our future business and financial results.

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