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

The popularity of particular designs and categories of footwear and apparel,apparel with consumers generally changes over time. The Company’s success depends in part on its ability to anticipate, understand and respond to changing footwear and apparel trends and consumer preferences in a timely manner. If the Company is unable to maintain and improve its competitive position, maintain or enhance the images of its brands, or timely and appropriately respond to new competition, changing consumer preferences and evolving footwear and apparel trends, consumers may consider the Company's brands’ images to be outdated and associate its brands with styles that are no longer popular, which would decrease demand for its products. Such failures could result in loss of market share, reduced sales, excess inventory, trade name impairments, lower gross margin and other adverse impacts on the Company’s operating results.

Foreign manufacturing is subject to a number of risks, including work stoppages, transportation delays and interruptions, political instability, foreign currency exchange rate fluctuations, changing economic conditions, expropriation, nationalization, the imposition of tariffs, including recent U.S. tariffs imposed or threatened to be imposed on other countries and any retaliatory actions taken by such countries, import and export controls and other non-tariff barriers and changes in governmental policies. Various factors could significantly impair the Company's ability to meet customer demands and produce its products in a cost-effective manner, including adverse developments in trade or political relations with China or other countries where it sources its products, or a shift in these countries' manufacturing capacities away from footwear and apparel to other industriesindustries, or other adverse developments, such as pandemics or other health crises that could cause significant production and shipping delays. Any of these events could adversely effectaffect the Company’s business, results of operations and financial position.

Pandemics, including COVID-19Pandemics and other infectious disease outbreaks have had and could continue to have a material adverse effect on the company's business.

The Company's business could be adversely affected by infectious disease outbreaks,outbreaks and actions taken in response, which may negatively affect the regional and global economy, including by disrupting consumer spending and global supply chains, and increasing the volatility of financial markets. These conditions following the onset of the COVID-19 pandemic led to a decline in discretionary spending by consumers that had a negative effect on the Company's financial condition and results of operations in 2020. Outbreaks of disease and actions taken in response, have in the past materially negatively impacted, and could in the future materially negatively impact, the Company's workforce, business, operations, and financial results in many ways. Potential future impacts to the Company’s workforce, business and operating results related to a health crisis, include, among others:

•Increased cyber securitycybersecurity risk due to the increase in the number of employees working remotely.

The Company’s business depends on its ability to source and distribute products in a timely and cost-effective manner. Labor disputes at or that affect factories that produce the Company’s goods, shipping ports, tanneries, transportation carriers, retail stores or distribution centers create significant risks for the Company’s business as they may result in work slowdowns, stoppages, lockouts, strikes or other disruptions. Any such disruption may cause inventory shortages, delayed or canceled orders and unanticipated inventory accumulation, each of which may negatively impact the Company’s results of operations and financial position.

The Company’s financial success depends on its wholesale customers continuing to purchase its products. Sales to the Company’s wholesale customers are generally on an order-to-order basis and are subject to wholesale customers' rights of cancellation and rescheduling. In fiscal 2022, the Company experienced a higher rate than usual of wholesale customer cancellations as retail customers sought to manage higher inventory levels and supply chain disruption. If any of the Company’s major wholesale customers experiences a significant downturn in its business, or fails to remain committed to the Company’s products, these customers may reduce or discontinue purchases from the Company, which could have an adverse effect on the Company’s results of operations and financial position.

The Company’s direct-to-consumer operations, including brick and mortar locations and its eCommerce and mobile channels, require substantial fixed investment in equipment and leasehold improvements, information systems, cyber-securitycybersecurity infrastructure, inventory and personnel. The Company also has substantial operating lease commitments for retail space. Due to the high fixed-cost structure of the Company’s brick and mortar direct-to-consumer operations, the closure or poor performance of any stores could result in significant lease termination costs, write-offs of equipment and leasehold improvements and employee-related costs. The Company has made and will continue to make significant investments in building technologies and digital capabilities. The success of its direct-to-consumer operations also depends on the Company’s ability to identify and adapt to changes in consumer spending patterns and retail shopping preferences, including the shift from brick and mortar to eCommerce and mobile channels and the continuing evolution of omni-channel retailing. The Company’s failure to respond to these factors successfully could adversely affect the Company’s direct-to-consumer business, limit the Company's ability to develop and expand the omni-channel experience for customers or damage its reputation and brands, any of which may have an adverse effect on the Company’s results of operations and financial position.

Disruption of the Company’s eCommerce platform or other information technology systemssystems, and the Company's use of artificial intelligence could adversely affect the Company’s business.

The Company’s information technology systems, including its eCommerce platform, are critical to the operations of its business. Any material interruption, unauthorized access, impairment or loss of data integrity or malfunction of these systems could severely impact the Company’s business. For example, system failures and disruptions could prevent access to the Company's online services, preclude store transactions, and impede product manufacturing and shipping and financial reporting. The Company’s information technology systems may be disrupted by natural disasters, accidents, power disruptions, telecommunications failures, acts of terrorism or war, denial-of-service attacks, computer viruses, other cybersecurity incidents, employee error, physical or electronic break-ins, or similar events. System redundancy may be ineffective or inadequate, and the Company’s disaster recovery planning may not be sufficient for all eventualities. Costs, problems and interruptions due to the implementation of new or upgraded systems, or maintenance of existing systems, could also disrupt or reduce the efficiency of the Company's operations. Additionally, the Company may be adversely affected if it is unable to improve, upgrade, maintain, and expand its technology systems.

The Company relies on owned and independently operated distribution facilities to transport, warehouse and ship products to its customers. The Company’s logistics and distribution systems include computer-controlled and automated equipment, which are subject to a number of risks related to,to data accuracy, security breaches or computer viruses, software or hardware malfunction, power interruptions or other system failures. Substantially all of the Company’s products are distributed from a relatively small number of locations. Distribution center operations could be interrupted by earthquakes, floods, fires or other natural disasters or other events over which the Company has no control, such as pandemics. In addition, the Company's distribution capacity depends upon the timely performance of services by third parties, including the transportation of products to and from the Company's distribution facilities. The Company’s business interruption insurance may not adequately protect the Company from the adverse effects of significant disruptions of distribution activities, such as the loss of customers or an erosion of brand image. Problems affecting the performance of the Company's distribution system could adversely affect its results of operations and its ability to meet customer expectations, manage inventory, complete sales and achieve operating efficiencies.

The Company’s results of operations depend on factors affecting consumer disposable income and spending patterns such as general economic conditions, inflation, employment rates, credit availability, business conditions, interest rates, consumer confidence and tax policy in the markets and regions in which the Company or its third-party distributors and licensees operates.operate. Customers may defer or cancel purchases of the Company’s products due to uncertainty about global, regional or local economic conditions, and how such conditions may impact them. Prior declines in disposable income and consumer spending have adversely affected demand for the Company’s products, and could further adversely affect demand and the Company's results of operations. If the Company reduces the prices of its products, offers additional promotions or increases marketing efforts due to decreases in consumer spending, the Company's profitability could decline.

The Company is subject to inflationary pressures, including increased costs of raw materials, transportation, labor and other aspects of its business, which the Company may not be able to offset with cost savings or price increases on its products. If inflationary pressures continue, and the Company is unable to pass along price increases or further reduce costs, the Company's results of operations willmay be negatively impacted.

The Company competes with a large number of wholesalers, and retailers of footwear and apparel, and direct-to-consumer footwear and apparel companies. Many have larger customer and consumer bases, and/or greater financial, technical or marketing resources than the Company, particularly its competitors in the apparel and direct-to-consumer businesses. The Company’s competitors may have brands with greater name recognition; implement more effective marketing campaigns; adopt more aggressive pricing policies; make more attractive offers to potential employees, distribution partners and manufacturers; incorporate artificial intelligence into their business faster or more successfully than the Company, or respond more quickly to changes in consumer preferences. The Company’s continued ability to sell its products at competitive prices and to meet shifts in consumer preferences quickly will affect its sales. If the Company is unable to respond effectively to competitive pressures, its results of operations and financial position may be adversely affected.

There is growing concern that climate changes could cause significant changes in weather patterns around the globe and increase the frequency and severity of natural disasters. This could have a long-term adverse impact on the Company’s business and results of operations by increasingexacerbating the effects described in the risk factor “Unseasonable or extreme weather conditions could adversely affect the Company’s results of operations” and decreasing agricultural productivity in certain regions, which may limit availability and/or increase the cost of certain raw materials, such as cotton and leather. Concern over climate change may result in newnew, additional or additionalchanging legal, legislative, regulatory, and compliance requirements to reduce or mitigate the effects of climate change on the environment, which could result in future tax, transportation, and utility increases, which could adversely affect the Company’s business and results of operations. Domestic and international regulatory efforts are evolving, including the potential international alignment or divergence of such efforts, and the Company cannot determine what final regulations will be enacted, modified, or reversed or the ultimate impact on its business.

In addition, an economic downturn, whether actual or perceived, a decrease in economic growth rates or an otherwise uncertain economic outlook in markets in which the Company operates could adversely effectaffect the Company.

The Company’s business could be significantly harmed if it is not able to protect its intellectual property or if it was found to infringe on other persons’ intellectual property rights. Certain artificial intelligence technology used by the Company or others may give rise to increased intellectual property risks, such as compromises to proprietary intellectual property and intellectual property infringement. Any intellectual property lawsuits or threatened lawsuits in which the Company is a plaintiff or a defendant could cost the Company a significant amount of time and money and distract management’s attention from operating the Company’s business. If the Company does not prevail on any intellectual property claims, it may have to change its manufacturing processes, products or trade names, any of which could reduce its profitability.

Increasing scrutiny and evolving expectations from customers, regulators, investors, and other stakeholders with respect to the Company’s environmental,sustainability socialpractices and governancerelated (“ESG”)legislative practicesand regulatory responses to climate change may impose additional costs on the Company or expose it to new or additional risks.

Companies are facing increasing and frequently evolving scrutiny globally from customers, regulators, investors, employees, other stakeholders and the media, including social media, related to their ESGsustainability practices and disclosure as expectations for, and support or criticism/skepticism of, such matters continuescontinue to evolve. Investor advocacy groups, investment funds and influential investors are also increasingly focused on these practices, especially as they relate to the environment, health and safety, board and workforce diversity, labor conditions, human rights, and cybersecurity and data privacy. Third parties have developed proprietary ratings or analyses of companies based on certain ESGsustainability metrics. Increased ESG-relatedsustainability related compliance costs could increase the Company’s overall operational costs. Failure to adapt to or comply with regulatory requirements or investor or other stakeholder expectations and standardsstandards, which may diverge and may not be reconcilable, could negatively impact the Company’s reputation, ability to do business with certain partners, and stock price. Concern over climate change may result in new, additional or changing legal, legislative, regulatory, and compliance requirements intended to reduce or mitigate the effects of climate change on the environment, which could result in increased tax, transportation, utility and other costs, which could adversely affect the Company's business and results of operations. New and changing domestic and international government regulations could also result in new or more stringent forms of ESGsustainability oversight and expanding mandatory reporting, diligence, and disclosure, including climate disclosures, and the Company cannot determine wahtwhat final regulations will be enacted, modified, or reversed or the ultimate impact on its business. The Company’s ESGsustainability initiatives and goals may be based on standards for measuring progress that are still developing,developing and may not be reconcilable, internal controls and processes that continue to evolve and assumptions that are subject to change. The Company may be subject to heightened reputational and operational risk and compliance costs related to the ESGsustainability initiatives and goals it disclosesdiscloses, or potential lack thereof, and may also face negative impacts from consumers who do not support its ESGsustainability initiatives and goals. Complying with new or changing regulations could increase the Company’s costs and adversely impact results of operations. The Company’s pursuit or its failure or perceived failure to meet stakeholders’ expectations, which may diverge, as well as adverse incidents, could negatively impact the Company’s stock price, results of operations, or reputation and increase its cost of capital, and investors, consumers and other stakeholders could lose confidence in or disparage the Company and its brands, damaging the Company's reputation and negatively impacting operations.

The Company’s failure to comply with an evolving set of laws and industry standards relating to consumer information, could negatively impact the Company’s business and results of operations.

The Company collects, maintains and uses data it receives through online activities and other consumer interactions in its business, including its marketing programs. The Company’s ability to do so is subject to certain restrictions in third party contracts and a broad array of evolving international, federal and state laws and industry standards relating to privacy, cybersecurity, data protection and consumer protection.protection, including in response to developments in the usage of artificial intelligence and other emerging technologies. These requirements may be interpreted and applied in a manner that is inconsistent from one jurisdiction to another, may conflict with other rules or may conflict with the Company’s practices. If the Company is not able to comply with any applicable requirements, the Company's reputation could be negatively impacted and the Company may be subject to proceedings or actions against it by governmental entities or others that could adversely affect its business, financial condition, cash flows and results of operations.

As data privacy, cybersecurity and marketing laws change, including in response to artificial intelligence and other emerging technologies, the Company may incur additional costs to remain in compliance. For example, the General Data Protection Regulation ("GDPR"), which applies in all European Union member states, introduced new data protection requirements in the European Union and substantial fines for breaches of the data protection rules. GDPR increased the Company’s responsibility and potential liability in relation to personal data that it collects, processes and transfers, and required the Company to implement additional controls designed to ensure compliance with the new rules. If applicable laws become more restrictive, the Company’s ability to effectively engage customers via personalized marketing may decrease, which could potentially impact growth. For example, the California Consumer Privacy Act (“CCPA”) limits how the Company may collect and use personal data and other states have adopted, or are considering enacting, similar laws that may affect the Company's data processing practices and policies.

The Company’s operations are subject to various federal, state and local laws and regulations relating to the protection of the environment, including those governing the discharge of pollutants, the management and disposal of hazardous materials and wastes, employee exposure to workplace hazards, and the investigation and remediation of contamination resulting from releases of hazardous materials. Failure to comply with legal requirements could result in, among other things, revocation of required licenses, enforcement actions, fines and civil and criminal liability. Various third parties have brought, and in the future could bringbring, actions against the Company alleging health-related or other harm arising from non-compliance. The Company may incur investigation, remediation or other costs related to releases of hazardous materials or other environmental conditions at its currently or formerly owned or operated properties, regardless of whether such environmental conditions were created by the Company or a third-party.third party. The Company has incurred, and continues to incur, costs to address soil and groundwater contamination at some locations. If such issues become more expensive to address, or if new issues arise, they could increase the Company’s expenses, generate negative publicity, or otherwise adversely affect the Company.

The Company may be named as a defendant in lawsuits and regulatory actions. For example, regulatory actions, punitive class actionsaction lawsuits and individual lawsuits have been filed against the Company alleging claims relating to property damage, remediation and human health effects, among other claims, arising from the Company’s operations, including its handling, storage, treatment, transportation and/or disposal of waste. These claims are discussed in more detail in Note 1716 to the Company's Consolidated Financial Statements. Due to the inherent uncertainties of litigation and regulatory proceedings, the Company cannot accurately predict the ultimate outcome of any such proceedings. An unfavorable outcome could have an adverse impact on the Company’s business, results of operations and financial position. In addition, the Company may have to devote substantial resources and executive time to the defense of such proceedings.

The Company’s brands are marketed in approximately 170 countries and territories at DecemberJanuary 28,3, 2024,2026, including through owned operations in the U.S., Canada, the United Kingdom and certain countries in continental Europe and Asia Pacific. In other regions (Latin America, portions of Europe and Asia Pacific, the Middle East and Africa), the Company relies on a network of third-party distributors, licensees and joint ventures. At DecemberJanuary 28,3, 2024,2026, the Company operated 119128 retail stores in the U.S., United Kingdom, and Italy and 39 direct-to-consumer eCommerce sites.

•Revenue was $1,755.0$1,874.3 million for 2024,2025, representing a decreaseincrease of 21.8%6.8% compared to the prior year's revenueyear of $2,242.9$1,755.0 million.

•Diluted earnings per share in 20242025 was $0.58,$1.14, compared to diluted loss per share of $0.51$0.55 in 2023.2024.

•Compared to the prior year, inventory decreasedincreased $133.0$26.4 million, or 35.6%, as of year-end.10.7%.

Revenue was $1,755.0$1,874.3 million for 2024,2025, representing aan decreaseincrease of 21.8%6.8% compared to the prior year's revenue of $2,242.9$1,755.0 million. The change in revenue reflected a $193.0$161.7 million, or 13.4%,13.0%, decreaseincrease from the Active Group, a $25.3$33.1 million, or 5.3%,7.3%, decrease from the Work Group and a $269.6$9.3 million, or 83.4%,17.4%, decrease from Other. The Active Group's revenue decreaseincrease was driven by aan decreaseincrease of $89.3$126.6 million from Saucony®, $77.4and $50.6 million from Merrell®, $21.4partially offset by decreases of $9.4 million from Chaco®, and $4.9$6.1 million from Sweaty Betty®. The Work Group’s revenue decrease was driven primarily by a decrease of $9.0$17.4 million from Wolverine®, $5.2 million from Cat®, $8.1$4.3 million from WolverineHYTEST®, $3.3 million from Bates®, $2.6$3.5 million from Harley-Davidson®, and $2.3$2.7 million from HYTESTBates®. The decrease in Other revenue was primarily driven by a decrease in revenue from businesses that were sold in 2023 and 2024 and the licensing of the Hush Puppies® business in 2023, which includes decreases of $191.9$4.6 million from Sperry®, $37.0$3.3 million from joint venture and royalty revenue recorded at the performancecorporate leatherslevel, business,and $25.7$0.9 million from Hush Puppies® and $6.5 million from Keds®. International revenue represented 49.1%,52.2%, and 45.7%49.1% of total reported revenues in 20242025 and 2023,2024, respectively. Changes in foreign exchange rates increased revenue by $2.8$14.0 million during 2024.2025. Direct-to-consumer revenue decreased by $98.5$8.4 million, or 16.9%1.7% during 20242025 compared to 2023.2024.

Operating expenses decreasedincreased $260.2$56.0 million in 2024,2025, to $680.5$736.5 million. The decreaseincrease was primarily driven by lowerhigher impairmentadvertising of long-lived assetscosts ($176.3$17.8 million), lower general and administrative costs ($48.8 million), lowerhigher selling costs ($45.2$17.8 million), lowerhigher advertisingenvironmental costsand other related costs, net of recoveries ($28.9$16.9 million), lowerhigher distributionincentive compensation costs ($25.5$13.5 million), lower reorganization costs ($18.0 million), and lower product development costs ($7.8 million), partially offset by lower2024 gains on the sale of businesses, trademarks, and long-lived assets ($81.8$8.5 million), and higher incentivegeneral compensationand administrative costs ($12.9$5.4 million), partially offset by lower reorganization costs ($17.0 million) and lower environmental and other related costs, netimpairment of recoverieslong-lived assets ($0.1$9.3 million). Environmental and other related costs were $15.6$6.6 million and $8.4$15.6 million in 20242025 and 2023,2024, respectively. See Note 1716 to the Company's Consolidated Financial Statements for further discussion of environmental remediation costs.

The effective tax rate in 20242025 was 16.3%,16.9%, compared to 70.7%15.9% in 2023.2024. InThe 2023increase in the Company recognized moreeffective tax benefitsrate comparedbetween to2025 and 2024 was primarily related to theincome generationmix andbetween utilizationjurisdictions ofwith adiffering capitaltax loss.rates.

The Company also reports “Other” and “Corporate” categories. The Other category consists of Hush Puppies® footwear, sourcing operations that include third-party commission revenues, multi-branded direct-to-consumer retail stores,store, the Stride Rite® licensed business, Sperry® footwear, Keds® footwear, and apparel and the Company’s leather marketing operations,.operations. The Corporate category consists of gains on the sale of businesses and trademarks, unallocated corporate expenses, such as corporate employee costs, corporate facility costs, IT costs, reorganization activities, impairment of long-lived assets and environmental and other related costs.

The Active Group’s revenue decreasedincreased $193.0$161.7 million, or 13.4%,13.0%, in 20242025 compared to 2023.2024. The revenue decreaseincrease was driven by an increase of $126.6 million from Saucony® and $50.6 million from Merrell®, partially offset by a decrease of $89.3 million from Saucony®, $77.4 million from Merrell®, $21.4$9.4 million from Chaco® and $4.9$6.1 million from Sweaty Betty®. The Saucony® decreaseincrease was driven primarily by strength in the US and EMEA wholesale channel and the Asia Pacific third-party distributor business. The Merrell® increase was primarily due to lower end of life inventory sales compared to the prior year, the divestiture of the Company's equity interestgrowth in the Chinacore jointSpeed venture entity, effective January 1, 2024,franchises and lowernew Saucony® kids revenue resulting from licensing the brandproduct in the Unitedlifestyle Statescategory, and Canada startingparticularly in the second quarter of 2024. The Merrell® decrease was primarily due to lower end of life inventory sales compared to the prior year, softer consumer demand in the U.S. wholesale and Internationalinternational channels and lower Merrell® kids revenue resulting from licensing the brand in the United States and Canada starting in the second quarter of 2024, partially offset by growth from new products, including Moab Speed and Speed Strike, and growth in core brand franchises, including Moab 3 and Jungle Moc.channels. The Chaco® decrease was primarily due to lower closeout and end of life inventory sales compared to the prior year and softer consumer demand. The Sweaty Betty® decrease was primarily due to softera consumer demanddecline in direct-to-consumerthe andU.S., wholesalepartially salesoffset channelsby acrossgrowth within the U.S.EMEA and China markets and lower end of life inventory sales compared to the prior year.market.

The Active Group’s operating profit increased $44.6$68.3 million, or 31.8%,36.9%, in 20242025 compared to 2023.2024. The operating profit increase was due to revenue increases and a 520300 basis point increase in gross marginmargin, andpartially offset by a $58.9$47.8 million decreaseincrease in selling, general and administrative costs partially offset by revenue decreases.costs. The increase in gross margin in the current year period was primarily due to decreasedthe closeoutbenefit of product cost savings, a favorable mix shift toward more full-price sales, lower product costs, and lowerthe supplypositive chainimpact costs.from recent price increases, partially offset by the impact of higher U.S. tariffs. The decreaseincrease in selling, general and administrative expenses in 2024the iscurrent year period was primarily due to lowerhigher advertising costs, selling expenses, distribution costs,costs and employee costs.

The Work Group’s revenue decreased $25.3$33.1 million, or 5.3%,7.3%, in 20242025 compared to 2023.2024. The revenue decrease was primarily driven by a decrease of $9.0$17.4 million from Wolverine®, $5.2 million from Cat®, $8.1$4.3 million from WolverineHYTEST®, $3.3$3.5 million from Harley-Davidson®, and $2.7 million from Bates®, $2.6 million from Harley-Davidson® and $2.3 million from HYTEST®. The Cat® decrease was primarily due to timing of shipments in the U.S. and international channels, lower closeout sales versus the prior year and softer consumer demand in direct-to-consumer channels, partially offset by growth in the U.S. wholesale channel. The Wolverine® decrease was primarily due to lower closeout sales compared to the prior year.year, lower demand in independent channels, and lower direct to consumer traffic. The BatesCat® decrease was primarily due to softer consumer demand in the U.S.North direct-to-consumerAmerican channels, high inventory levels at certain retail customers and lower closeout sales versus the prior year. The Harley-Davidson® decrease was primarily due to declines in top dealer accounts.market. The HYTEST® decrease was primarily due to lower closeout sales compared to the prior year,year. partiallyThe offsetHarley-Davidson® bydecrease growthwas inprimarily due to softer consumer demand within the U.S. wholesale channel. The Bates® decrease was primarily due to lower closeout sales as compared to the prior year.

The Work Group’s operating profit increased $11.1$3.5 million, or 19.1%,5.1%, in 20242025 compared to 2023.2024. The operating profit increase was due to a 180250 basis point increase in gross margin and ana $11.1$4.7 million decrease in selling, general and administrative costs partially offset by revenue decreases. The increase in gross margin in the current year period was primarily due to decreasedthe closeoutbenefit sales, lowerof product cost andsavings, a favorable averagemix sellingshift price.toward more full-price sales, and the positive impact from recent price increases, partially offset by the impact of higher U.S. tariffs. The decrease in selling, general and administrative expenses in 2024the current year period was primarily due to lower advertisingdistribution costs,costs and selling expenses, and employee costs.expenses.

Cash and cash equivalents of $152.1$206.3 million as of DecemberJanuary 28,3, 20242026 were $32.5$54.2 million lowerhigher compared to December 30,28, 2023.2024. The decreaseincrease is due primarily to cash provided by operating activities of $140.0 million, proceeds from the exercise of stock options of $12.2 million, favorable foreign exchange impacts of $5.8 million and net revolver paymentsborrowings of $235.0$5.0 million, partially offset by cash dividends paid of $33.3 million, long-term debt payments of $39.2 million, cash dividends paid of $32.5 million, additions to property, plant, and equipment of $20.2$14.5 millionmillion, andpurchases of common stock of $14.5 million, shares acquired related to employee stock plans of $2.6 million, partially offset by cash provided by operating activities of $180.1 million, proceeds from the sale of businesses, trademarks, long-lived assets and other assets of $102.4 million, proceeds from company-owned life insurance policy liquidations of $7.9$10.7 million and proceeds from company-owned life insurance policiespayment of $7.0debt issuance costs of $3.9 million. The Company had $724.0$510.5 million of borrowing capacity available under the Revolving Facility as of DecemberJanuary 28,3, 2024.2026. Cash and cash equivalents located in foreign jurisdictions totaled $134.1$181.3 million as of DecemberJanuary 28,3, 2024.2026.

A detailed discussion of environmental remediation costs is found in Note 1716 to the Company's Consolidated Financial Statements. The Company has established a reserve for estimated environmental remediation costs based upon an evaluation of currently available facts with respect to each individual affected site. As of DecemberJanuary 28,3, 2024,2026, the Company has a reserve of $39.7$26.5 million, of which $19.4$12.0 million is expected to be paid in the next 12 months and is recorded as a current obligation in other accrued liabilities, with the remaining $20.3$14.5 million recorded in other liabilities and expected to be paid over the course of up to 25 years. The Company's remediation activity at its former Tannery site and sites where the Company disposed of Tannery byproducts is ongoing. It is difficult to estimate the cost of environmental compliance and remediation given the uncertainties regarding the interpretation and enforcement of applicable environmental laws and regulations, the extent of environmental contamination and the existence of alternative cleanup methods.

Note 1716 to the Company's Consolidated Financial Statements also includes a detailed discussion of environmental litigation matters. As of DecemberJanuary 28,3, 2024,2026, the Company had recorded liabilities of $10.1$8.5 million for certain of these environmental litigation matters which are recorded as other accrued liabilities in the consolidated balance sheets.

The Company expects to meet its contractual obligations through its customary sources of liquidity in the normal course of business, such as cash from operating activities, and believes it has the financial resources to satisfy these contractual obligations. The Company had the following contractual obligations due by period at DecemberJanuary 28,3, 20242026:

(1)Includes principal and interest payments on the Company’s long-term debt. Estimated future interest payments on outstanding debt obligations are based on interest rates as of DecemberJanuary 28,3, 2024.2026. Actual cash outflows may differ significantly due to changes in underlying interest rates.

(3)Under the terms of a Consent Decree resolving certain civil and regulatory actions, the Company is obligated to contribute towards the costs of extending municipal water lines, developing a replacement wellfield and making certain improvements to Plainfield Township’s existing water treatment plant, all subject to an aggregate cap of $69.5 million. During 2024 and 2023, theThe Company has made payments of $12.2 million and $6.4$61.3 million towards the total cap, respectively.cap. Due to the uncertainty of the timing and amounts related to the Company's other environmental remediation costs, they have been excluded from this table. See Note 1716 to the Company's Consolidated Financial Statements for additional information.

(4)The total amount of unrecognized tax benefits on the consolidated balance sheet at DecemberJanuary 28,3, 20242026 iswas $1.6$1.4 million. At this time, the Company is unable to make a reasonably reliable estimate of the timing of payments in individual years beyond 12 months due to uncertainties in the timing of tax audit outcomes. As a result, this amount is not included in the table above.

TheOn Company’sSeptember 24 2025, the Company entered into a 2025 Replacement Facility Amendment and Reaffirmation Agreement (the “Credit Agreement”) to replace the existing revolving credit agreementfacility provides for aand term loan A facilityfacility. (theThe “TermCompany’s Facility”)Credit andAgreement provides for a revolving credit facility (the “Revolving Facility” and, together with the Term Facility, the “Senior Credit Facilities”). The maturity date of the loans under the SeniorRevolving Facility is September 24, 2030. The Credit Facilities is October 21, 2026. The credit agreementAgreement provides for a debt capacity of up to an aggregate debt amount (including outstanding term loan principal andexisting revolver commitment amounts in addition to permitted incremental debt) not to exceed $2.0$850.0 billion unless certain specified conditions set forth in the Credit Agreement are met.million. The Revolving Facility allows the Company to borrow up to an aggregate amount of $800.0$600.0 million.

As of DecemberJanuary 28,3, 2024,2026, the Company was in compliance with all covenants and performance ratios under the Credit Agreement.Agreement and senior notes.

The Company’s debt at DecemberJanuary 28,3, 20242026 totaled $648.0$621.7 million, compared to $920.8$648.0 million at December 30,28, 2023.2024. The Company expects to use the current borrowings to fund organic growth initiatives, pay dividends and for general corporate purposes. The decreased debt position is due to lowerrepayment borrowings underof the Revolvingterm Facilityfacility resulting from operating cash inflowsinflows, partially offset by capital expenditures, cash dividends, and proceedspurchase fromof divestitures.common stock.

Cash from operations during 20242025 was higher compared to 2023, due primarily toincluded a decrease in net working capital representing a source of cash of $82.6$8.8 million. Working capital balances were favorably impacted by a decrease in inventories of $127.1 million and a decrease in accounts receivable of $16.7$54.2 million,million partiallyand offsetan by a decreaseincrease in other operating liabilities of $47.9$23.3 million, partially offset by an increase in inventories of $20.9 million, an increase in other operating assets of $5.6 million, a decrease in income taxes payable of $4.3$17.8 million, and a decrease in accounts payable of $3.4$30.0 million. Operating cash flows included a non-cash add back for depreciation and amortization expense adjustment of $26.2$25.9 million, a deferred income tax adjustment of $21.4$8.0 million, a stock-based compensation expense adjustment of $19.1$24.4 million, a cash outflow of $14.5 million for environmental and other related costs, net of cash paymentspayments, and recoveries received cash outflow of $13.3 million, the impairment of long-lived assets of $9.3 million, gain on sale of business, trademarks and long-lived assets of $8.5 million, anda pension expense adjustment of $0.2$1.0 million.million, and $12.6 million of other operating cash outflows.

The Company made capital expenditures of $20.2$14.5 million and $14.6$20.2 million in years 20242025 and 2023,2024, respectively, for building improvements, eCommerce site enhancements, new retail stores, distribution operations improvements and information system enhancements. The current year activity also includes proceeds from the sale of businesses and trademarks of $102.4 million and company-owned life insurance policy liquidations of $7.9$2.2 million.million and $1.6 million of other investing cash outflows.

The current year debt activity includes net paymentsborrowings under the Revolving Facility of $235.0$5.0 million, payments on long-term debt of $39.2$32.5 millionmillion, and proceeds from company-owned life insurance policiespayment of $7.0debt issuance costs of $3.9 million. The Company paid $2.6$10.7 million and $5.8$2.6 million in 20242025 and 2023,2024, respectively, in connection with shares or units withheld to pay employee taxes related to awards under stock incentive plans. The Companycompany receivedpaid $31.2$14.5 million for purchases of its own common stock and had proceeds of $12.2 million from noncontrollingthe interestsexercise inof 2023.stock options.

Revenue is recorded at the net sales price (“transaction price”), which includes estimates of variable consideration for which reserves are established. Components of variable consideration include trade discounts and allowances, product returns, customer markdowns, customer rebates and other sales incentives relating to the sale of the Company’s products. These reserves are based on the amounts earned, or to be claimed on the related sales. These estimates take into consideration a range of possible outcomes, which are probability-weighted in accordance with the expected value method for relevant factors such as current contractual and statutory requirements, specific known market events and trends, industry data and forecasted customer buying and payment patterns. Overall, these reserves reflect the Company’s best estimates of the amount of consideration to which it is entitled based on the terms of the respective underlying contracts. Revenue recognized during the year ended DecemberJanuary 28,3, 20242026 related to the Company’s contract liabilities was nominal.

The Company values its inventory at the lower of cost or net realizable value. Cost is determined by the last-in, first out ("LIFO") method for certain domestic finished product inventories. Cost is determined using the first-in, first-out (“FIFO”) method for all raw materials, work-in-process and finished product inventories in foreign countries and certain domestic finished product inventories. The Company changed its method of accounting for certain domestic inventory valued using the last-in, first-out (“LIFO”) method to the first-in, first-out (“FIFO”) inventory valuation method, refer to "Change in Accounting Principle", within Note 1, for additional information regarding this change. The average cost of inventory is used for finished product inventories of the Company’s U.S. retail store business inventory. The Company has applied these inventory cost valuation methods consistently from year to year.

The Company performs its annual testing for goodwill and indefinite-lived intangible asset impairment at the beginning of the fourth quarter of the fiscal year for all reporting units. The Company did not recognize any impairment charges for goodwill and indefinite-lived intangible assets during 2025 and 2024 and 2023. In the fourth quarter of 2022, after completion of the annual impairment testing, the Company recorded a $48.4 million impairment charge for Sweaty Betty® goodwill. The Company did not recognize any impairment charges for indefinite-lived intangible assetsgoodwill during 2024.2023. In the third quarter of 2023, after completion of impairment testing, the Company recorded a $38.3 million impairment charge for the Sperry® trade name. In the fourth quarter of 2022, the Company recognized impairment charges of $191.0 million for the Sperry® trade name and $189.3 million for the Sweaty Betty® trade name. Refer to Note 4, “Goodwill and Other Intangible Assets” for additional discussion of the Sweaty Betty® goodwill impairment and the Sweaty Betty® and Sperry® trade name impairments.impairment.

The Company utilizes a bond matching calculation to determine the discount rate used to calculate its year-end pension liability and subsequent year pension expense. A hypothetical bond portfolio is created based on a presumed purchase of individual bonds to settle the plans' expected future benefit payments. The discount rate is the resulting yield of the hypothetical bond portfolio. The bonds selected are listed as high grade by at least two recognized ratings agency and are non-callable, currently purchasable and non-prepayable. The calculated discount rate was 5.72% at January 3, 2026, compared to 5.75% at December 28, 2024, compared to 5.30% at December 30, 2023.2024. Pension expense is also impacted by the expected long-term rate of return on plan assets, which the Company has determined to be 6.96%7.60% and 6.88%6.96% for fiscal 20242025 and 2023,2024, respectively. This rate is based on both actual historical rates of return experienced by the pension assets and the long-term rate of return of a composite portfolio of equity and fixed income securities that reflects the approximate diversification of the pension assets.

The Company is a leading global footwear and apparel company driven by a vision to Make. Every Day. Better. The Company’s brands are marketedsold in approximately 170 countries and territories at AprilJuly 4, 2026, including through owned operations in the U.S., Canada, the United Kingdom and certain countries in continental Europe and Asia Pacific. In other regions (Latin America, portions of Europe and Asia Pacific, the Middle East and Africa), the Company relies on a network of third-party distributors, licensees and joint ventures. At AprilJuly 4, 2026, the Company operated 126123 retail stores in the U.S., United Kingdom, Ireland and Italy and 38 direct-to-consumer eCommerce sites.

The Company’s revenue from sales to customers in the Middle East represents approximately 1% of total revenue and is managed by third-party distributors. The Company is closely monitoring the ongoing conflict in the Middle East to determine the potential impacts on the Company’s business, which may include a reduction in distributor revenue and an increase in product input costs and transportation costs associated with elevated oil costs.

•Revenue was $457.6$506.4 million for the firstsecond quarter of 2026, representing an increase of 11.0%6.8% compared to the firstsecond quarter of 2025.

•Gross margin was 47.6%46.5% in the firstsecond quarter of 2026 compared to 47.6%47.2% in the firstsecond quarter of 2025.

•The effective tax rates in the firstsecond quarters of 2026 and 2025 were 18.8%19.5% and 8.9%,13.7%, respectively.

•Diluted earnings per share for the firstsecond quarter of 2026 was $0.24$0.37 compared to $0.15$0.32 for the firstsecond quarter of 2025.

•The Company declared cash dividends of $0.10 per share in the firstsecond quarters of both 2026 and 2025.

•Cash flow provided by operating activities was $3.4 million for the first two quarters of 2026 compared to cash flow used in operating activities wasof $83.2$39.2 million for the first quartertwo of 2026 compared to $83.8 million for the first quarterquarters of 2025.

•Compared to the firstsecond quarter of 2025, inventory as of the end of the firstsecond quarter of 2026 increaseddecreased $1.1$55.2 million, or 0.4%.17.0%.

Revenue was $457.6$506.4 million for the firstsecond quarter of 2026, representing an increase of $45.3$32.2 million compared to the firstsecond quarter of 2025. The change in revenue reflected a $44.9$32.9 million, or 13.7%,9.3%, increase from the Active Group, a $0.9$1.7 million, or 1.2%,1.6%, increasedecrease from the Work Group, and a $0.5$1.0 million, or 4.6%,8.9%, decreaseincrease from the Other category. The Active Group’s revenue increase was primarily driven by an increase of $26.1$17.6 million from Merrell® and $14.3 million from Saucony® and $19.1 million from Merrell®. The Work Group’s revenue increasedecrease was primarily driven by increasesdecreases of $0.9$2.3 million from HYTESTCat® and $0.8$1.9 million from Harley-Davidson®, partially offset by aan decreaseincrease of $1.0$2.5 million from Wolverine®. The decreaseincrease in Other revenue was primarily driven by aan decreaseincrease in Hush Puppies® royalty revenue. Changes in foreign exchange rates increased revenue by $15.4$3.1 million during the firstsecond quarter of 2026. Direct-to-consumer revenue increased during the firstsecond quarter of 2026 by $2.9$0.1 million, or 3.0%,0.1%, compared to the firstsecond quarter of 2025.

Gross margin was 47.6%46.5% in the firstsecond quarter of 2026 compared to 47.6%47.2% in the second quarter of 2025. Gross margin was 47.0% in the first quartertwo quarters of 2026 compared to 47.4% during the first two quarters of 2025. HigherThe decrease in gross margin was primarily related to higher tariff costscosts, in the first quarter of 2026 werepartially offset by price increases andother bytariff amitigation favorable mix shift toward more full-price sales.initiatives.

Operating expenses increased $8.8$4.7 million, from $175.1$183.3 million in the firstsecond quarter of 2025 to $183.9$188.0 million in the firstsecond quarter of 2026. The increase was primarily driven by higher advertisingselling costs ($8.0$5.1 million), higher sellinglegal settlement costs ($5.5$2.5 million), higher distribution costs ($2.2$2.0 million), and higher incentive compensation costs ($0.9$1.8 million), partially offset by lower general and administrative costs ($4.4$3.9 million), lower environmental and other related costs, net of insurance recoveries ($1.9 million) and 2025 reorganization costs that did not reoccur in 2026 ($1.8$1.9 million), and lower advertising costs ($1.2 million).

Net interest expense was $6.5$7.1 million in the firstsecond quarter of 2026 compared to $8.0$8.5 million in the second quarter of 2025. Net interest expense was $13.6 million in the first quartertwo quarters of 2026 compared to $16.5 million in the first two quarters of 2025. The decrease in interest expense for both the quarter-to-date and year-to-date periods is primarily due to lower average principal balances of variable rate debt.

Other income was $0.2$0.6 million in the firstsecond quarter of 2026, compared to other income of $1.5$1.4 million in the second quarter of 2025. Other income was $0.8 million in the first quartertwo quarters of 2026, compared to other income of $2.9 million in the first two quarters of 2025.

The effective tax rates in the second quarter of 2026 and 2025 were 19.5% and 13.7%, respectively. The effective tax rates in the first quartertwo quarters of 2026 and 2025 were 18.8%19.2% and 8.9%,12.3%, respectively. The increase in the effective tax raterates between 2026 and 2025 was primarily related to changes in the income mix among jurisdictions with differing tax rates and the decreased impact of discrete benefits on the tax rate in the current year due to higher pretax income.

The Company also reports “Other” and “Corporate” categories. The Other category consists of Hush Puppies® footwear and apparel, sourcing operations that include third-party commission revenues, multi-branded direct-to-consumer retail store and the Stride Rite® licensed business. The Corporate category consists of unallocated corporate expenses, such as corporate employee costs, corporate facility costs, IT costs, reorganization activities, impairment of long-lived assets and environmental and other related costs.

The Active Group’s revenue increased $44.9$77.8 million, or 13.7%,11.4%, in the first quartertwo quarters of 2026 compared to the first quartertwo quarters of 2025. The revenue increase was primarily driven by increases of $26.1$40.4 million from Saucony® and $19.1$36.7 million from Merrell®. The Saucony® increase was primarily driven by strength in the EMEA wholesale channel and international third-party distributor business growth.channel. The Merrell® increase was primarily driven by growthstrong indemand theacross its core Moab and Moab Speed franchisesfranchises, andcomplemented new product inby the lifestylelaunch category,of particularlyAgility inPeak the wholesale channel.6.

The Active Group’s operating profit increased $8.3$6.5 million, or 14.3%,10.0%, in the firstsecond quarter of 2026 compared to the firstsecond quarter of 2025. The operating profit increase was due to revenue increases, partially offset by ana 80190 basis point decrease in gross margin and a $10.9$2.3 million increase in selling, general and administrative expenses. The Active Group’s operating profit increased $14.8 million, or 12.1%, in the first two quarters of 2026 compared to the first two quarters of 2025. The operating profit increase was due to revenue increases, partially offset by a 130 basis point decrease in gross margin and a $13.2 million increase in selling, general and administrative expenses. The decrease in gross margin in the current year period was primarily due to increased U.S. tariff costs and unfavorable product and customer mix, partially offset by price increases and improved full price mix. The increase in selling, general and administrative expenses in the current year periodperiods was primarily due to higher advertising and selling costs, partially offset by lower general and administrative costs.

The Work Group’s revenue increaseddecreased $0.9$1.7 million, or 1.2%,1.6%, in the firstsecond quarter of 2026 compared to the firstsecond quarter of 2025. The Work Group’s revenue increasedecrease was primarily driven by $0.9$2.3 million from HYTESTCat® and $0.8$1.9 million from Harley-Davidson®, partially offset by decreasesan increase of $1.0$2.5 million from Wolverine®. The HYTESTWork Group’s revenue decreased $0.7 million, or 0.4%, during the first two quarters of 2026 compared to the first two quarters of 2025. The revenue decrease was primarily driven by a decrease of $1.9 million from Cat®, partially offset by an increase of $1.5 million from Wolverine®. The Cat® increasedecrease was primarily due to increasesdecreases in consumer demand in both North America and higherinternational closeout sales.markets. The Harley-Davidson® decrease was primarily due to decreased consumer demand in the U.S. wholesale channels. The Wolverine® increase was primarily due to increased consumer demand in theWolverine U.S. wholesale channelsWorkwear and newhigher retailaverage distribution.sale The Wolverine® decrease was primarily due to softer consumer demand within apparel and accessories and declinesprices in internationalWolverine EMEA and Latin America markets due to a transition from third-party distributors to third-party licensees.footwear.

The Work Group’s operating profit decreased $0.6$3.6 million, or 8.5%,17.7%, in the firstsecond quarter of 2026 compared to the firstsecond quarter of 2025. The operating profit decrease was due to a $2.1200 basis point decrease in gross margin and a $0.7 million increase in selling, general and administrative expenses,expenses. The decrease in gross margin in the current year period was primarily due to higher U.S. tariffs and unfavorable product mix, partially offset by aprice 160 basis point increase in gross margin.increases. The increase in selling, general and administrative expenses in the current year periodperiods was primarily due to higher advertisinggeneral and administrative costs. The increase in gross margin in the current year period was primarily due to a favorable product mix within the international third party channel, partially offset by higher U.S. tariffs.

The Other category’s revenue decreasedincreased $0.5$1.0 million, or 4.6%,8.9%, in the firstsecond quarter of 2026 compared to the firstsecond quarter of 2025. The Other category’s revenue decreaseincreased $0.4 million, or 1.8%, in the first two quarters of 2026 compared to the first two quarters of 2025. The revenue increase was primarily driven by aan decreaseincrease in Hush Puppies® royalty revenue.

Other operating profit decreasedincreased $0.4 million, or 5.3%,4.9%, in the firstsecond quarter of 2026 compared to the firstsecond quarter of 2025. The operating profit decreaseincreased in the firstsecond quarter of 2026 was primarily due to lowerhigher Hush Puppies® royalty income. Other operating profit decreased $0.1 million, or 0.6%, in the first two quarters of 2026 compared to the first two quarters of 2025.

Corporate expenses decreased $5.6$3.3 million in the firstsecond quarter of 2026 compared to the firstsecond quarter of 2025, primarily due to lowertariff corporatemitigating generalbenefits andfrom administrativesourcing costspartners recognized in 2026 ($2.7 million), lower environmental and other related costs ($1.9$3.4 million), lower reorganization activities ($1.8$1.9 million), lower badcorporate debtsoftware expenselicensing costs ($0.7$1.9 million), and lower inventory reserves recorded at the corporate level ($1.1 million), partially offset by higher legal settlement costs ($2.5 million) and higher incentive compensation costs ($0.9$1.9 million).

Cash and cash equivalents of $119.6$158.5 million as of AprilJuly 4, 2026 were $13.1$17.5 million higher compared to MarchJune 29,28, 2025. The increase is due primarily to cash provided by operating activities of $140.6$182.6 million, proceeds from the exercise of stock options of $12.1$11.9 million, and proceeds from company ownedcompany-owned life insurance policy liquidations of $2.2 million, partially offset by net repayments of debt of $73.0$108.5 million, cash dividends paid of $33.5$33.6 million, purchases of common stock of $14.5 million, employee taxes paid under stock-based compensation of $11.1$10.7 million, additions to property, plant and equipment of $8.6$7.6 million, and cash used in other investing activitiespayments of $1.5debt issuance costs of $3.9 million. The Company had $492.9$522.8 million of unborrowed capacity under the Revolving Facility as of AprilJuly 4, 2026. Cash and cash equivalents located in foreign jurisdictions totaled $92.9$129.6 million as of AprilJuly 4, 2026.

The Company did not repurchase shares of its common stock during the first quartertwo quarters of both 2026 and 2025.

A detailed discussion of environmental remediation costs is found in Note 15 to the consolidated condensed financial statements. The Company has established a reserve for estimated environmental remediation costs based upon an evaluation of currently available facts with respect to each individual affected site. As of AprilJuly 4, 2026, the Company had a reserve of $25.5$23.3 million, of which $11.1$9.5 million is expected to be paid in the next 12 months and is recorded as a current obligation in other accrued liabilities and the remaining $14.4$13.8 million is recorded in other liabilities and is expected to be paid over the course of up to 25 years. The Company's remediation activity at its former Tannery site and sites where the Company disposed of Tannery byproducts is ongoing. It is difficult to estimate the cost of environmental compliance and remediation given the uncertainties regarding the interpretation and enforcement of applicable environmental laws and regulations, the extent of environmental contamination and the existence of alternative cleanup methods.

On September 2424, 2025, the Company entered into a 2025 Replacement Facility Amendment and Reaffirmation Agreement (the “Credit Agreement”) to replace the existingprevious revolving credit facility and term loan A facility. The Credit Agreement provides for a revolving credit facility (the “Revolving Facility”). The maturity date of the loans under the Revolving Facility is September 24, 2030. The Credit Agreement provides for a debt capacity of up to an aggregate debt amount (including existing revolver commitment amounts in addition to permitted incremental debt) not to exceed $850.0 million. The Revolving Facility allows the Company to borrow up to an aggregate amount of $600.0 million.

As of AprilJuly 4, 2026, the Company was in compliance with all covenants and performance ratios under the credit agreement.

The Company’s debt at AprilJuly 4, 2026 totaled $638.9$601.1 million compared to $621.7 million at January 3, 2026. The Company expects to use the current borrowings to fund organic growth initiatives and for general corporate purposes. The increasedLower debt positionis isprimarily due to higherrepayment of borrowings under the Revolving Facility mainly resulting from operating cash outflows, partially offset by lower cash balances.Facility.

For the first quartertwo quarters of 2026, an increase in net working capital represented a use of cash of $115.2$66.1 million. Working capital balances were unfavorably impacted by an increase in accounts receivable of $57.2 million, a decrease in other operating liabilities of $55.0$31.5 million, apartially decreaseoffset by an increase in accounts payable of $35.5$14.4 million, an increase in accounts receivable of $21.4 million, an increase in inventories of $7.6 million, partially offset by a decrease in other operating assets of $4.3 million, and a decrease in inventories of $3.9 million. Operating cash flows included adjustments for stock-based compensation expense of $5.8$12.4 million, depreciation and amortization expense adjustment of $5.2$10.5 million, other operating activities of $5.0 million, environmental and other related costs, net of cash payments and recoveries received, cash outflow of $1.9$4.0 million, and deferred income taxes of $0.2$0.3 million.

The Company made capital expenditures of $1.7$4.1 million and $7.6$11.0 million in the first quartertwo quarters of 2026 and 2025, respectively, for corporate headquarters building improvements, eCommerce site and information system enhancements, and storefor openings.company owned stores.

The current year debt activity includes net borrowingsrepayments under the Revolving Facility of $17.0$21.0 million. The Company paid $2.5$5.0 million in principal payments associated with its long-term debt during the first quartertwo quarters of 2025. The Company paid $8.1$8.5 million and $7.7$8.5 million during the first quartertwo quarters of 2026 and 2025, respectively, in connection with shares or units withheld to pay employee taxes related to awards under stock incentive plans. The Company received cash proceeds from the exercise of stock options of $0.2 million and $0.3$0.5 million during the first quartertwo quarters of 2026 and 2025. The Company did not repurchase its shares in the first quartertwo quarters of 2026 or 2025.

The Company declared cash dividends of $0.10$0.20 per share during the first quartertwo quarters of 2026 and 2025. Dividends paid in the first quartertwo quarters of 2026 and 2025 totaled $8.7$17.0 million and $8.5$16.7 million, respectively. A quarterly dividend of $0.10 per share was declared on MayAugust 6,3, 2026 to stockholders of record on JulyOctober 1, 2026.