NPO 10-K & 10-Q changes, risk factors and insider trading

The markets in which we sell our products and solutions, particularly wafer fab equipment for semiconductor manufacturing, chemical companies, petroleum refineries, heavy-duty trucking, and capital equipment are, to varying degrees, cyclical and have historically experienced periodic downturns. Prior downturns have been characterized by diminished product demand, excess manufacturing capacity and subsequent erosion of average selling prices in these markets resulting in negative effects on our net sales and results of operations. TheOur waferproducts faband equipmentsolutions for the semiconductor manufacturing market, hashave historically been characterized by rapid changes in demand due to changes in electronics demand, economic conditions (both general and in the semiconductor and electronics industries), industry supply and demand, prices for semiconductors, the level of capital expenditures by manufacturers supplying semiconductor fabricators, and the ability of fabricators to manufacture increasingly complex and costly semiconductor devices. A prolonged and severe downward cycle in our markets, particularly in our semiconductor markets, could have a material adverse effect on our business, financial condition, results of operations and cash flows. In addition, in the past, we have experienced downturns in end-market demand due to uncertainty regarding the impact of tariffs or threatened tariffs and related trade tensions. The United States and other countries have imposed and may continue to impose new trade restrictions and export regulations, have levied tariffs and taxes on certain goods, and could significantly increase tariffs on a broad array of goods. Other geopolitical actions or threatened geopolitical actions may adversely affect international trade relations. These actions, or the threat of these actions in the United States or other jurisdictions material to our operations and end markets, could depress demand for our products or increase the cost to manufacture our products, which may affect the competitiveness of our products relative to manufacturers not affected by such actions, which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

We encounter intense competition in almost all areas of our businesses. Customers for many of our products and solutions are attempting to reduce the number of vendors from which they purchase. To remain competitive, we need to invest continuously in manufacturing, marketing, customer service and support and our distribution networks. We also need to develop new products and solutions to continue to meet the needs and desires of our customers. In addition, if we fail to timely respond to rapid increases in demand for our products and services, or to effectively manage any corresponding expansion of our manufacturing or service capacity, our customers may divert their purchases of products and services from us to our competitors. We may not have sufficient resources to continue to make such investments or maintain our competitive position. Additionally, some of our competitors are larger than we are and have substantially greater financial resources than we do. As a result, they may be better able to withstand the effects of periodic economic downturns. Certain of our products and solutions may also experience transformation from unique branded products to undifferentiated price sensitive products and solutions. This commoditization may be accelerated by low-cost foreign competition. Changes in the replacement cycle of certain of our products and solutions, including because of improved product and service quality or improved maintenance, may affect aftermarket demand for such products and solutions. Initiatives designed to distinguish our products and solutions through superior service, continuous improvement, innovation, customer relationships, technology, new product acquisitions, bundling with key services, long-term contracts or market focus may not be effective. Pricing and other competitive pressures could adversely affect our business, financial condition, results of operations and cash flows.

A majority of the revenues of our Advanced Surface Technologies segment are derived from manufacturing, cleaning, coating and refurbishing components used in advanced node semiconductor manufacturing equipment. Due to consolidation in the semiconductor manufacturing equipment industry, a small number of companies control a significant majority of the global production of semiconductor manufacturing equipment. As a result, the segment is dependent on certain key relationships with customers in that industry, including a customer that accounted for approximately 21%24% of our 20242025 consolidated net sales. These sales were made by our Advanced Surface Technologies segment and the loss of the segment’s relationship with that customer or other key customers or other adverse changes in the segment’s relationships with those customers could have a material adverse effect on our business, financial condition, results of operations and cash flows. Consolidation among our customers, or a decision by any one or more of our customers to no longer outsource the type of solutions provided by our Advanced Surface Technologies segment, may further concentrate our business in a limited number of customers and expose us to increased risks relating to dependence on an even smaller number of customers. The customer base of our Advanced Surface Technologies segment is also geographically concentrated, particularly in Taiwan, Singapore, and the U.S. The geographic concentration of this customer base could shift over time as a result of changes in technology and competitive landscape, geopolitical actions, including government policies and incentives to develop regional semiconductor industries. Such a change in geographic concentration may require that we incur significant cost to enable our Advanced Surface Technologies segment to continue to effectively supply its customer base.

We have seen organic changes related to price increases of raw materials overin the pastpast, severalwhich years.have adversely affected our business and results of operations. The prices of some of our raw materials may continue to increase due to supply chain limitations or the imposition (or announcement of the intended imposition) of new or increased tariffs or changes in trade laws, including tariffs imposed in response to the tariffs announced by the U.S. government in January 2025 withand respectretaliatory totariffs goods sourcesannounced in China,response Mexico, and Canada.thereto. While we have been successful in passing along some of these higher costs, there can be no assurance we will be able to continue doing so without losing customers. Similarly,Some of AST's operations rely upon sourcing certain rare earth minerals that historically have been sourced indirectly from China. While inventories of these materials are sufficient for near-term requirements, and we are working to develop alternative sources for these materials, the future supply of these materials is uncertain. The loss of a key supplier, the unavailability of a key raw material, or other disruptions of our supply chain could adversely affect our business, financial condition, results of operations and cash flows. In addition, we have limited sources for certain key raw materials and other supplies.

Our products and solutions are often used in critical applications in demanding environments, including in the nuclear, oil and gas, automotive, aerospace and pharmaceutical industries. Accordingly, product and service failures can have significant consequences and could result in significant product liability, warranty and other claims against us, regardless of whether our products and services caused the incident that is the subject of the claim, and we may have obligations to participate in the recall of products in which our products are components, if any of the components or services we supply prove to be defective. We endeavor to identify and obtain in established markets insurance agreements to cover certain significant risks and liabilities, though insurance against some of the risks inherent in our operations (such as insurance covering down-stream customer product recalls or nuclear-related liabilities) is either unavailable or available only at rates or on terms that we consider excessive. DependingWith onrespect competitiveto conditionscertain sales into the nuclear industry, Enpro may benefit from legal frameworks that operate as pooling arrangements to protect suppliers, although the specific structure and otheravailability factors, we endeavor to obtain contractual protection against uninsured risks from our customers, including limitations on liability and indemnification. In some cases, we are unable to obtainof such contractualprotections protections, and when we do, such contractual protection may not be as broad as we desire, may not be supportedvary by adequate insurance maintained by the customer, or may not be fully enforceable in the jurisdictions in which our customers are located. Such insurance or contractual protection may not be sufficient or effective under all circumstances or against all hazards to which we may be subject. A successful claim or product recall for which we are not insured or for which we are underinsured could have a material adverse effect on us. Additionally, disputes with insurance carriers over coverage may affect the timing of cash flows and, if litigation with the carrier becomes necessary, an outcome unfavorable to us may have a material adverse effect on our results of operations.country.

Our business may be impacted by information technology disruptions, including information technology attacks. Cybersecurity attacks, in particular, are evolving and include, but are not limited to, malicious software, attempts to gain unauthorized access to data or corporate funds, and other electronic security breaches that could lead to disruptions in systems, unauthorized release of confidential or otherwise protected information and corruption of data (our own or that of third parties). We have experienced cybersecurity attacks and, while we believe that we have adopted appropriate measures and procedures to mitigate potential risks to our systems from information technology-related disruptions, it is possible that a cybersecurity attack could be successful in breaching the measures and procedures designed to protect our systems, including due to the development, through the application of artificial intelligence,intelligence and quantum computing, of more advanced cybersecurity attacks. In such an event, we could potentially be subject to production downtimes, operational delays, other detrimental impacts on our operations or ability to provide products and services to our customers, the compromising of confidential or otherwise protected information, misappropriation, destruction or corruption of data, security breaches, misappropriation of corporate funds, other manipulation or improper use of our systems or networks, financial losses from remedial actions, loss of business or potential liability, and/or damage to our reputation, any of which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Our outstanding senior notes, which bear interest at 5.75% per annum, mature on October 15, 2026 and weWe may be required to obtain financing in order to fund the refinancing of theour senior notes and other outstanding debt, as well as certain strategic acquisitions, if they arise. We are also exposed to risks from tightening credit markets, through the interest payable on any variable-rate debt, including the interest cost on future borrowings under our senior credit facilities. The credit environment could impact our ability to borrow money in the future. Additional financing or refinancing might not be available and, if available, may not be at economically favorable terms, including at interest rates in excess of the rates applicable to the Company’s outstanding indebtedness. Further, an increase in leverage could lead to deterioration in our credit ratings. A reduction in our credit ratings, regardless of the cause, could also limit our ability to obtain additional financing and/or increase our cost of obtaining financing. There is no guarantee we will be able to access the capital markets at financially economical interest rates, which could negatively affect our business and results of operations.

There is growing concern that a gradual increase in global average temperatures as a result of increased concentration of carbon dioxide and other greenhouse gases in the atmosphere will cause significant changes in weather patterns around the globe and an increase in the frequency and severity of natural disasters. Many of our manufacturing facilities use significant amounts of electricity generated by burning fossil fuels, which releases carbon dioxide. Such climatephysical changerisks may impair our production capabilities, disrupt our supply chain or impact demand for our products. GrowingIn addition, Enpro faces transition risks associated with growing concern over climate changechange, alsowhich may result in customer needs evolving to adjust to a low-carbon economy and in additional legal or regulatory requirements designed to reduce or mitigate the effects of carbon dioxide and other greenhouse gas emissions on the environment. Increased energy or compliance costscosts, increased product investments to address evolving customer needs, and increased expenses as a result of increased legal or regulatory requirements may cause disruptions in, or an increase in the costs associated with, the manufacturing and distribution of our products. The impacts of climate change and legal or regulatory initiatives to address climate change could have a long-term adverse impact on our business and results of operations. If we fail to align product investment to adjust to a low-carbon economy, or if we do not achieve or improperly report on our progress toward achieving our goals and commitments to reduce our carbon footprint or in environmental and sustainability programs and initiatives, the results could have an adverse impact on our business, financial position, results of operations or cash flows.

We have exposure to some contingent liabilities relating to previously owned businesses, which could have a material adverse effect on our financial condition, results of operations, and cash flows in any fiscal period.

We have contingent liabilities related to discontinued operations and previously owned businesses of our predecessors, including environmental liabilities and liabilities for certain products and other matters. In some instances we have indemnified others against those liabilities, and in other instances we have received indemnities from third parties against those liabilities. For example, in 2014 when our then Fairbanks Morse division and a consortium partner entered into a multi-year arrangement with Electricite de France ("EDF") to supply opposed-piston, diesel engine generator set to EDF for emergency backup power at 20 of EDF's nuclear power plants in France, Enpro Inc. guaranteed the performance of Fairbanks Morse's obligations under agreements with our consortium partner, which guarantee continues to be in place following our sale of Fairbanks Morse, though both Fairbanks Morse and the purchaser of Fairbanks Morse have agreed to indemnify us for any payments we are required to make pursuant to such guarantee.

Claims could arise relating to products, facilities, employees or former employees, or other matters related to our discontinued operations. Some of these claims could seek substantial monetary payments. For example, Enpro has entered into an Administrative Settlement Agreement and Order on Consent for Interim Removal Action with the Environmental Protection Agency for the assessment and potential remediation of eight surface uranium mines in Arizona on the basis that our EnPro Holdings subsidiary, through which we hold most of our operating subsidiaries, was a potentially responsible party under federal environmental laws as the successor to a former operator in the 1950s of those mines. Further, we could potentially be liable with respect to firearms manufactured prior to March 1990 by Colt Firearms, a former operation of a corporate predecessor of EnPro Holdings, and electrical transformers manufactured prior to May 1994 by Central Moloney, another former operation of that corporate predecessor. Additionally, in 2014, prior to the sale of our former Fairbanks Morse division in 2020, Enpro Inc. guaranteed the performance of certain of Fairbanks Morse’s obligations regarding its supply of diesel engine generators used for emergency backup power at nuclear power plants in France, although Fairbanks Morse and its purchaser have agreed to indemnify us for any payments made under such guarantee.

Because we sell our products and provide services in a number of foreign countries, we are subject to risks associated with doing business internationally. In 2024,2025, we derived approximately 43% of our net sales from sales of our products and solutions outside of the U.S. Outside the U.S., we operate 8 primary manufacturing and service facilitiesfacility locations (approximately 50,000 square feet or larger) located in 7 countries. Our sales and operating activities outside of the U.S. are, and will continue to be, subject to a number of risks, including:

The agreement governing our senior secured revolving credit facility and the indenture governing our senior notes imposeimposes limitations on our operations, such as limitations on certain restricted payments, investments, incurrence or repayment of indebtedness, and maintenance of a consolidated net leverage ratio and an interest coverage financial ratio. In addition, the indenture governing our senior notes contains limitations on certain restrictedasset payments, investmentssales and incurrence or repaymentgranting of indebtedness.liens. These limitations could impede our ability to respond to market conditions, address unanticipated capital investment needs and/or pursue business opportunities.

Borrowings under our revolving credit facility and our term loan facilities incur interest which is variable based onon, fluctuationsat inour option, either the referencedfederal funds rate or the Secured Overnight Financing Rate ("SOFR"). plus the applicable margin. Increases in the referenced SOFRrate will increase the Company's borrowing costs and negatively impact financial results and cash flows.

Our Advanced Surface Technologies (AST) segment applies proprietary technologies, processes, and capabilities to deliver a highly differentiated suite of products and solutions for challenging applications in high-growth markets. The segment’s products and solutions are used in demanding environments requiring performance, precision and repeatability, with a low tolerance for failure. AST’s products and solutions capabilities include: (i) engineering, manufacturing and precision machining of complex front-end wafer processing sub-systems, including critical components used in and around semiconductor process chambers that enable the manufacture of leading-edge chips, as well as edge-welded bellows that support critical applications in the space, aerospace and defense markets; (ii) cleaning, coating, testing, refurbishment and verification for critical components and assemblies used in semiconductor manufacturing equipment, with meaningful exposures to state-of-the-art advanced node chip applications; and (iiiii) coatings for critical components and assemblies for semiconductor manufacturing equipment, and designing, manufacturing and selling specialized optical filters and proprietary thin-film coatings for the most challenging applications in the industrial technology, life sciences, and semiconductor markets; (iii) engineering and manufacturing complex front-end wafer processing sub-systems and new and refurbished electrostatic chuck pedestals for the semiconductor equipment industry; and (iv) engineering and manufacturing edge-welded metal bellows for the semiconductor equipment industry and critical applications in the space, aerospace and defense markets. In many instances, AST capabilities drive products and solutions that enable the performance of our customers’ high-value processes through an entire life cycle.

OnWe Januarypaid 29, 2024, Enpro acquired all of the equity securities of Advanced Micro Instruments, Inc. ("AMI"), a privately held company, for $209.4$273.9 million, net of cash acquired.acquired, for the two acquisitions completed in the fourth quarter of 2025. We have funded these acquisitions with available cash on hand in the United States and borrowings under our revolving credit facility. In connection with the acquisitionacquisitions of AMI,these businesses, there were $3.9$7.4 million of acquisition-related costs incurred during the year ended December 31, 20242025 andwhich are included in selling, general, and administrative expense in the accompanying Consolidated Statements of Operations. The post-acquisition results of Overlook and AlpHa are reflected within the Sealing Technologies segment.

Based in Costa Mesa, California, AMI serves customers in the midstream natural gas, biogas, industrial processing, cryogenics, food processing, laboratory wastewater and aerospace markets,markets. The companyAMI offers a portfolio of oxygen, hydrogen, sulfide and moisture analyzers and proprietary sensing capabilities that detect contaminants in a variety of processes, including natural gas and biogas streams, which enable operators to avoid flaring and, thereby, reduce CO2 emissions.

In connection with our acquisition of Alluxa in October 2020, threethe Alluxa executives (the "Alluxa Executives") received rollover equity interests in the form of approximately 7% of the total equity interest ofthe anAlluxa entityAcquisition Subsidiary, which we formed for the purpose of acquiring AlluxaAlluxa. (theThe "Alluxa Acquisition Subsidiary"). Pursuant to the limited liability operating agreement (the "Alluxa LLC Agreement") that was entered into with the completion of the transaction, included the Put and Call Rights, under which each Alluxa Executive had the right to sell to us, and we had the right to purchase from each Alluxa Executive (collectively, the "Put and Call Rights"),Executive, one-third of the Alluxa Executive equity interests in the Alluxa Acquisition Subsidiary during each of three exercise periods in 2024, 2025 and 2026, with any amount not sold or purchased in a prior exercise period being carried forward to the subsequent exercise periods. In January 2024, we agreed with the Alluxa Executives to change the terms of the Put and Call Rights so that all outstanding equity interests could be acquired in 2024. In February of 2024, we acquired all outstanding equity interests in the Alluxa Acquisition Subsidiary for $17.9 million, which was the minimum fixed price set in the Alluxa LLC Agreement. As this transaction was for the acquisition of all remaining shares of a consolidated subsidiary with no change in control, it was recorded within shareholder's equity and as a financing cash flow in the Consolidated Statement of Cash Flows. As a result of the acquisition of these equity interests, Enpro is nowbecame the sole owner of Alluxa.

The sale of GGB to The Timken Company closed on November 4, 2022 to The Timken Company.2022. We received $298.2 million, net of transaction fees and cash sold, including $3.1 million of payments made in Q1 of 2023. We recorded a pre-tax gain of $189.1 million as part of our discontinued operations in the fourth quarter of 2022.

We measure operating performance of our reportable segments based on segment earnings before interest, income taxes, depreciation, amortization, and other selected items ("Adjusted Segment EBITDA" or "Segment AEBITDA"), which is segment revenue reduced by operating expenses and other costs identifiable with the segment, excluding acquisition and divestituredisposition expenses, restructuring costs, impairment charges, non-controlling interest compensation,compensation allocation, restructuring and impairment expense, net of gains on restructuring-related sales of assets, amortization of the fair value adjustment to acquisition date inventory, and depreciation and amortization.amortization expense. Adjusted Segment EBITDA is not defined under GAAP and may not be comparable to similarly-titledsimilarly titled measures used by other companies. Corporate expenses include general corporate administrative costs. Segment non-operating expenses and income, corporate expenses, net interest expense, goodwill impairment, loss on pension settlement and income taxes are not included in the computation of Adjusted Segment EBITDA. The accounting policies of the reportable segments are the same as those for Enpro.

Non-controlling interest compensation allocation represents compensation expense associated with a portion of the rollover equity from the acquisitionsacquisition of LeanTeq and Alluxa that was subject to reduction for certain types of employment terminations of the sellers.Alluxa Executives. This expense was recorded in selling, general, and administrative expenses on our Consolidated Statements of Operations and is directly related to the terms of the acquisitions.acquisition. We acquired all of the LeanTeq non-controlling interests in the fourth quarter of 2022 and all of the Alluxa non-controlling interests in the first quarter of 2024.

We incurred $6.2$2.5 million, $5.0$6.2 million and $3.0$5.0 million of restructuring and impairment costs during the years ended December 31, 2024,2025, 20232024 and 2022,2023, respectively. Additionally,In in 2023 and 2022,2023, we incurred a goodwill impairment chargescharge of $60.8 million and $65.2 million, respectively, related to the Alluxa reporting unit.

Of the restructuring and impairment costs incurred in 2024,2025, 20232024 and 2022,2023, we incurred $2.8$2.5 million, $4.3$2.8 million and $1.8$4.3 million, respectively, of restructuring costs related to the reorganization of sites and functions, primarily in the United States and $3.4 million, and $0.7 million, in 2024 and $1.2 million,2023, respectively, of non-cash impairment charges of long-lived assets. Workforce reductions associated with our restructuring activities in 2025, 2024, 2023, and 20222023 totaled 35, 77, 72, and 2572 administrative and manufacturing positions, respectively.

As of December 31, 2024,2025, we held $49.3$16.6 million of cash and cash equivalents in the United States and $187.0$101.5 million of cash and highly liquid short-term investments outside of the United States. If the funds held outside the United States were needed for our operations in the U.S., we have several methods to repatriate such funds without significant adverse tax effects, including repayment of intercompany loans, distributions subject to a 100 percent dividends-received deduction for income tax purposes, or distributions of previously-taxed earnings.

Because of the transition tax, GILTI, and Subpart F provisions, undistributed earnings of our foreign subsidiaries totalinghave $187.1 million at December 31, 2023 havealready been subjected to U.S. income tax or are eligible for the 100 percent dividends-received deduction under Section 245A of the Internal Revenue Code ("IRC"). provided in the Tax Cuts and Jobs Act. Additionally, undistributed earnings are estimated to be $239.4 million as of December 31, 2024. Whether through the application of the 100 percent dividends received deduction, or distribution of these previously-taxed earnings, weWe do not intend to distribute foreign earnings that will be subject to any significant incremental U.S. or foreign tax. During 2024,2025, we repatriated $61.3$306.2 million of earnings from our foreign subsidiaries, resulting in only $0.3$0.4 million of withholding taxes. We have determined that estimating any tax liability on our investment in foreign subsidiaries is not practicable. Therefore, we have not recorded any deferred tax liability on undistributed earnings of foreign subsidiaries.

Operating activities of continuing operations provided cash in the amount of $201.2 million, $162.9 million,million and $208.4 million in 2025, 2024 and $106.12023, millionrespectively. The increase in 2024,operating 2023cash flows in 2025 versus 2024 was primarily attributable to the increase in revenue and 2022,operating respectively.income and lower net cash payments for interest. The decrease in operating cash flows in 2024 versus 2023 was primarily attributable the decline in revenue, timing of working capital, and payments related to short-term operating liabilities, as well as $18.9 million of additional tax payments made in 2024. The increase in operating cash flows in 2023 versus 2022 was primarily attributable to less income tax payments, net of refunds ($63.6 million) and improvements in net working capital. Higher tax payments in 2022 were the result of high proceeds from our divestiture of discontinued operations.

Investing activities of continuing operations used $241.5$316.9 million,$241.5 million , and $7.4 million in 2024 and 2023, respectively, and provided $302.7 million of cash in 2022.2025, 2024, and 2023. Investing activities in 2025 used cash primarily for the acquisitions of Overlook and AlpHa ($273.9 million) and investments in property, plant, and equipment ($42.0 million). Investing activities in 2024 used cash primarily for the acquisition of AMI ($209.4 million) and investments in property, plant, and equipment ($29.1 million). Investing activities in 2023 used cash primarily for investments in property, plant, and equipment ($33.9 million), partially offset by proceeds of the sale of businesses, principally the sale of GPT ($25.9 million). Investing activities in 2022 provided cash from the sale of businesses ($301.9 million), primarily the sale of GGB, and the settlement of derivative contracts ($27.4 million). This was partially offset by investments in property, plant and equipment ($29.4 million).

Financing activities of continuing operations used $17.4 million in cash in 2025, as $26.2 million of dividend payments were offset in part by the proceeds from the issuance of our $450 million senior notes and from borrowings on our revolving credit facility net of repayments of our previously outstanding $350 million senior notes and of our term loan facility. See below for further details. Financing activities of continuing operations used $50.5 million in cash in 2024,2024 primarily attributable to the acquisition of non-controlling interests, primarily for the acquisition of the Alluxa non-controlling interests ($18.3 million), net repayments of debt ($8.1 million) and dividend payments ($25.3 million). Financing activities of continuing operations used $170.9 million in 20232023, primarily attributable to payments on our Termterm Loanloan Facilities,facilities includingin theplace completeduring repaymentthat of our Term Loan A-1 Facility, as defined and discussed belowyear ($144.9 million), and by dividend payments ($24.3 million). Financing activities used $402.1 million in 2022, primarily attributable to a net payment our Revolving Credit Facility, as defined below, and Term Loan Facilities ($337.0 million), the acquisition of the equity interests in LeanTeq held by the LeanTeq Executives ($34.1 million) and dividend payments ($23.4 million)

Senior Secured Credit Facility.Facilities. On DecemberApril 17,9, 2021,2025, we entered into a Second Amendment to Third Amended and Restated Credit Agreement dated as of April 9, 2025 (the “Amended Credit Facility Agreement”) dated as of December 17, 2021 among the Company and our subsidiary, EnPro Holdings, Inc. ("EnPro Holdings"), as borrowers, certain of our foreign subsidiaries areof the Company from time to time party thereto, as designated borrowers, the guarantors party thereto, the lenders party thereto and Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer. The Amended Credit Facility Agreement amends,amended restatesthe agreement then governing our senior secured credit facilities and replacesprovides for a senior secured revolving credit facility of up to $800.0 million (the “Revolving Credit Facility”), which will mature on April 9, 2030. On April 9, 2025, in connection with our entry into the SecondAmended AmendedCredit Facility Agreement, we repaid the remaining outstanding principal amount of term loan borrowings outstanding under the agreement governing our senior secured credit facilities prior to such amendment, funded by borrowings under the Revolving Credit Facility and Restated$59.8 Credit Agreement dated asmillion of Juneavailable 28, 2018, as amended, among the Company and EnPro Holdings as borrowers, the guarantors party thereto, the lenders party thereto and Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer.cash.

TheEnpro CompanyInc. and EnPro Holdings are the permitted borrowers under the Facilities.Amended Credit Facility Agreement. We have the ability to add wholly owned foreign subsidiaries as borrowers under the Revolving Credit Facility. Each of our domestic, consolidated subsidiaries (other than any subsidiaries that may be designated as "unrestricted" by the Company from timesubject to timecertain an inactive subsidiariesexclusions) is required to guarantee the obligations of the borrowers under the Facilities,Amended andCredit Facility Agreement and, subject to the permitted exceptions, each of ourthe Company’s existing domestic, consolidateddomestic subsidiaries (other than inactive subsidiaries) has entered into the Amended Credit Facility Agreement to provide such a guarantee.

Collateral. Borrowings under the FacilitiesAmended Credit Facility Agreement are secured by a first-priorityfirst priority pledge of the following assets:

•100% of the capital stock of each domesticdomestic, consolidated subsidiary of theEnpro Company (other than unrestricted or inactive subsidiaries)Inc.;

•65% of the capital stock of any first tier foreign subsidiary of theEnpro CompanyInc. and its domestic subsidiaries (othersubject thanto unrestrictedcertain or inactive subsidiariesexclusions); and

•substantially all of the assets (including, without limitation, machinery and equipment, inventory and other goods, accounts receivable, bank accounts, general intangibles, financial assets, investment property, license rights, patents, trademarks, trade names, copyrights, chattel paper, insurance proceeds, contract rights, hedge agreements, documents, instruments, indemnification rights, tax refunds and cash, but excluding real estate interests) of theEnpro CompanyInc. and itsthe domesticsubsidiary subsidiaries (other than unrestricted or inactive subsidiaries).guarantors.

Financial Covenants. The Amended Credit Facility Agreement contains certain financial covenants and required financial ratios, including:

•a maximum consolidated total net leverage ratio of not more than 4.754.0 to 1.0 (with total debt, for the purposes of such ratio, to be net of up to $150 million of unrestricted cash of Enpro Inc. and its consolidated subsidiaries), which ratio will decrease to 4.5 to 1.0 for each fiscal quarter beginning with the fiscal quarter ending March 31, 2022 and ending with the fiscal quarter ending December 31, 2022, and to 4.0 to 1.0 for each quarter thereafter; and, once so decreased, may be increased (up to three times) at the borrowers'borrowers’ option to not more than 4.5 to 1.0 for the for-quarterfour-quarter period following a significant acquisition; and

Affirmative and Negative Covenants. The Amended Credit Facility Agreement contains affirmative and negative covenants (subject, in each case, to customary exceptions and qualifications), including covenants that limit our ability to, among other things:

These products are used in a variety of markets, including chemical and petrochemical processing, nuclear energy, hydrogen, natural gas, food and biopharmaceutical processing, primary metal manufacturing, mining, water and waste treatment, commercial vehicle, aerospace (including commercial space), medical, filtration and semiconductor fabrication. In all these industries, the performance and durability of our proprietary products and solutions are vital for the safety and environmental protection of our customers’ processes. Many of our products and solutions are used in highly demanding applications, often in harsh environments, where the cost of failure is extremely high relative to the cost of our offerings to our customers. These environments include those where extreme temperatures, extreme pressures, corrosive agents, strict tolerances, or worn equipment create challenges for product performance. Sealing Technologies offers customers widely recognized applied engineering, innovation, process know- howknow-how and enduring reliability, driving a lasting aftermarket for many of our products and solutions.

Highlights. Financial highlights for the threequarters and six months ended MarchJune 31,30, 2026 and MarchJune 31,30, 2025 are as follows:

We measure operating performance of our reportable segments based on segment earnings before interest, income taxes, depreciation, amortization, and other selected items ("Adjusted Segment EBITDA" or "Segment AEBITDA"), which is segment revenue reduced by operating expenses and other costs identifiable with the segment, excluding acquisition expenses, restructuring costs, net of gains on restructuring-related sales of assets, amortization of the fair value adjustment to acquisition date inventory, and depreciation and amortization. Adjusted Segment EBITDA is not defined under GAAP and may not be comparable to similarly titled measures used by other companies. Corporate expenses include general corporate administrative costs. Corporate expenses also include $1.2$1.5 million and $2.7 million of restructuring expense for the threequarters and six months ended MarchJune 31,30, 2026.2026, respectively. Segment non-operating expenses and income, corporate expenses, net interest expense, and income taxes are not included in the computation of Adjusted Segment EBITDA. The accounting policies of the reportable segments are the same as those for Enpro.

ThreeSecond MonthsQuarter Ended March 31,of 2026 Compared to the ThreeSecond MonthsQuarter Ended March 31,of 2025

Sales of $303.0$338.8 million in the firstsecond three monthsquarter of 2026 increased 10.9%17.6% from $273.2$288.1 million last year. The following table summarizes the impact of an acquisition and foreign currency on segment sales:

Discussion of year-over-year operating performance for each segment for the firstsecond three monthsquarter of 2026:

Sealing Technologies:Technologies. Sales of $199.0$216.2 million in the firstsecond three monthsquarter of 2026 increased 10.8%15.3% compared to $179.6$187.5 million inlast the prior-year period.year. Excluding favorable foreign exchange translation ($5.7$2.9 million) and contribution from acquisitions completed in the fourth quarter of 2025 ($14.4$16.4 million), sales were downup 0.4%,5.0%, or $0.7$9.4 million. Pricing and mix ($5.9$6.4 million), as well asand strength in space,aerospace, nucleargeneral solutions,industrial in North America and Asia, and compositional analysis applications,applications largelywere offset in part by continued weakdemand demandweakness in commercial vehicle OEM sales, and slow general industrial markets internationally. DomesticEuropean general industrial and food and biopharmaceutical demand remained firm.demand.

Adjusted Segment EBITDA of $64.6$71.7 million in the firstsecond three monthsquarter of 2026 increased 10.1%, or $5.9 million,13.3% from $58.7$63.3 million prior year. Adjusted Segment EBITDA margin of 32.5% in the firstthird threequarter monthsof 2025. Segment AEBITDA margin narrowed 60 basis points to 33.2% in the second quarter of 2026 wasfrom relatively33.8% flat compared to the priorlast year. Excluding the favorable foreign exchange translation ($2.0$0.9 million) and contribution from acquisitions completed in the fourth quarter of 2025 ($3.2$5.0 million), Adjustedadjusted Segment EBITDA increased 1.2%,3.8%, or $0.7$2.4 million. Favorable pricingPricing and mixvolume gains were partially offset lowerby saleshigher volume.headcount and personnel-related costs supporting growth initiatives ($2.9 million).

Advanced Surface Technologies:Technologies. Sales of $104.2$122.9 million in the firstsecond three monthsquarter of 2026 increased 11.1%,21.8% or $10.4$22.0 million,million compared to $93.8sales of $100.9 million in thelast prior-yearyear's period,second reflectingquarter. continued strengthAcceleration in precision cleaning solutionssolutions, serving the leading edge, strengtheningincreased demand for critical semiconductor capital equipment,tools and firmassemblies, demandand growth in optical coatings.coatings drove the increase in sales.

Corporate expenses for the firstsecond three monthsquarter of 2026 of $13.7$15.7 million increased $2.4$3.6 million compared to lastthe yearsame period in 2025, primarily due to $1.2$1.3 million of higher restructuring costs incurred in the first quarter of 2026 and increased incentive compensation accruals.accruals of $2.4 million.

Interest expense, net in the firstsecond three monthsquarter of 2026 increased by $0.8 million compared tofrom the firstsecond three monthsquarter of 2025 primarily driven by lowera interesthigher incomeaverage outstanding debt balance in 2026.

Other expense in the firstsecond three monthsquarter of 2026 decreasedincreased $0.7$13.8 million compared to the same period last year, driven primarily dueby tonet environmental reserve adjustments ($16.8 million), partially offset by a loss on extinguishment of debt in 2025 ($1.7 million) and lower non-service pension related costs as($0.7 amillion) resultdriven ofby the termination of our U.S. defined benefit pension plan attermination thecompleted endin oflate 2025.

The effective tax rates for the three monthsquarters ended MarchJune 31,30, 2026 and 2025 were 19.2%17.6% and 24.3%,25.5%, respectively. The effective tax rate for the threesecond monthsquarter ended MarchJune 31,30, 2026 is lower than the usual U.S. Federal tax rate primarily driven by additional tax benefit related to share-based payments,payments and adjustments to uncertain tax positions, partially offset by higher tax rates in most foreign jurisdictions. The effective tax rate for the three monthsquarter ended MarchJune 31,30, 2025 is higher than the U.S. Federal tax rate primarily driven by higher tax rates in most foreign jurisdictions,jurisdictions and state tax on domestic earnings, partially offset by additionalvarious tax benefit related to share-based payment awards.credits.

Net income was $27.4$27.1 million, or $1.29$1.27 per share, in the firstsecond three monthsquarter of 2026 compared to $24.5$26.4 million, or $1.15$1.25 per share, in the firstsecond three monthsquarter of 2025. Earnings per share is expressed on a fully diluted basis.

As of MarchJune 31,30, 2026, the aggregate amount of transaction price of remaining performance obligations, or backlog, on a consolidated basis was $357.7$432.2 million. Approximately 94%95% of these obligations are expected to be satisfied within one year. There is no certainty these orders will result in actual sales at the times or in the amounts ordered. In addition, for most of our business, backlog is not particularly predictive of future performance due to shorter lead times for our leading-edge aftermarket or recurring solutions across both segments and some seasonality.

As of MarchJune 31,30, 2026, we held $9.2$10.0 million of cash and cash equivalents in the United States and $70.0$67.0 million of cash outside of the United States. If the funds held outside the United States were needed for our operations in the U.S., we have several methods to repatriate without significant tax effects, including repayment of intercompany loans, distributions subject to a 100 percent dividends-received deduction for income tax purposes, or distributions of previously-taxed earnings. In the first quartersix months of 2026, we transferred $50.0$60.0 million from our foreign subsidiaries to their U.S. parent entity via an intercompany loan, and the funds were used to partially pay down the outstanding balance on our revolving credit facility.

Because of the transition tax, GILTI, and Subpart F provisions, undistributed earnings of our foreign subsidiaries have already been subjected to U.S. income tax or are eligible for the 100 percent dividends-received deduction under Section 245A of the Internal Revenue Code (“IRC”). We do not intend to distribute foreign earnings that will be subject to any significant incremental U.S. or foreign tax. During the first threesix months of 2026, there were no earningswe repatriated from$21.1 ourmillion of foreign subsidiaries, therefore no foreign withholding taxes were incurred.earnings. We have determined that estimating any tax liability on our investment in foreign subsidiaries is not practical.practicable. Therefore, we have not recorded any deferred tax liability on undistributed earnings of foreign subsidiaries.

Operating activities provided $39.6$90.9 million of cash in the first threesix months of 2026 and $21.0$73.2 million of cash in the first threesix months of 2025. The year-over-year increase was primarily driven by higher adjusted net income and lower incomecash tax payments (netin of2026 refunds),than efficientin workingthe capitalprior management, and higher net income.year.

Investing activities used $8.6$26.0 million of cash in the first threesix months of 2026 compared to $9.4$19.6 million of cash used in investing activities in the first threesix months of last year asdriven theprimarily redemption of a short-term investment offsetby higher cash capital expenditures in the first threesix months of 2026, partially offset by the redemption of short term investments in 2026.

Financing activities used $66.2$102.0 million of cash in the first threesix months of 2026 compared to $13.3$194.9 million in the first threesix months of 2025. The increasedecrease was driven primarily by thehigher repaymentnet repayments of $50.0 million on our revolving credit facilitydebt in March 2026 funded by intercompany loans from our foreign subsidiaries.2025.

Availability and Compliance. The borrowing availability under our Revolving Credit Facility at MarchJune 31,30, 2026 was $630.6$660.2 million after giving consideration to $9.4$9.8 million of outstanding letters of credit and $160.0$130.0 million of outstanding borrowings. We were in compliance with all covenants of the Amended Credit Facility Agreement as of MarchJune 31,30, 2026.

At MarchJune 31,30, 2026, we were in compliance with all of the covenants of the indenture governing the Senior Notes.

A reconciliation of (i) net income to adjusted net income, including on a per share basis, and (ii) net income to adjusted EBITDA for the threequarters and six months ended MarchJune 31,30, 2026 and 2025 as set forth below.