Compass Diversified Holdings (CODI) Business

ITEM 1. BUSINESS

Company Background

Compass Diversified Holdings, a Delaware statutory trust, was formed in Delaware on November 18, 2005. Compass Group Diversified Holdings, LLC, a Delaware limited liability company, was also formed on November 18, 2005. The Trust and the LLC were formed to acquire and manage a group of small and middle-market businesses headquartered in North America. The Trust is the sole owner of 100% of the Trust Interests, as defined in our LLC Agreement, of the LLC. Pursuant to the LLC Agreement, the Trust owns an identical number of Trust Interests in the LLC as exist for the number of outstanding shares of the Trust.

The Trust was previously treated as a partnership for U.S. federal income tax purposes but elected, effective September 1, 2021, to be taxed as an association taxable as a corporation.

The LLC is the operating entity with a board of directors (the "Board") whose corporate governance responsibilities are similar to that of a Delaware corporation. The LLC’s Board oversees the management of the Company and our businesses and the performance of our Manager. Certain persons who are employees, former employees or members of our Manager receive a profit allocation as beneficial owners (through Sostratus LLC) of the Allocation Interests, as defined in our LLC Agreement.

Overview

We acquire controlling interests in and actively manage our subsidiaries that we believe (i) operate in industries with long-term macroeconomic growth opportunities, (ii) have positive and stable cash flows, (iii) face minimal threats of technological or competitive obsolescence, and (iv) have strong management teams largely in place. We offer investors a unique opportunity to own a diverse group of leading middle-market businesses in the branded-consumer and industrial sectors.

Our disciplined approach to our target markets provides opportunities to methodically acquire and manage attractive businesses that will create value for our shareholders. For sellers of businesses, our unique financial structure allows us to purchase businesses efficiently with fewer third-party financing contingencies and, following acquisition, to provide our businesses with access to growth capital. In addition, our permanent capital model generally allows us to acquire businesses at any point across economic cycles, ensuring that we are able to act quickly when the opportunity presents itself, even when markets are volatile.

Private company operators and corporate parents looking to sell their business units may consider us an attractive purchaser because of our ability to:

•provide ongoing strategic and financial support for their businesses, including professionalization of our subsidiaries at scale;

•maintain a long-term outlook as to the ownership of those businesses;

•sustainably invest in growth capital and/or add-on acquisitions where appropriate; and

•consummate transactions efficiently without being dependent on third-party transaction financing.

In particular, our long-term approach and our active management may alleviate the concern that many private company operators and parent companies may have with regard to their businesses going through multiple sale processes in a short period of time. We believe our approach enhances our ability to develop a comprehensive strategy to grow the earnings and cash flows of each of our businesses.

Finally, it has been our experience, that our ability to acquire businesses without the cumbersome delays and conditions typical of third-party transactional financing is appealing to sellers of businesses who are interested in confidentiality, speed and certainty of close.

Our management team’s strong relationships with industry executives, accountants, attorneys, business brokers, commercial and investment bankers, and other potential sources of acquisition opportunities offer us opportunities to assess small to middle market businesses available for acquisition. In addition, the flexibility, creativity, experience and expertise of our management team in structuring transactions allows us to consider non-traditional and complex transactions tailored to fit a specific acquisition target.

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We categorize the current businesses we own into two separate groups: (i) branded consumer businesses and (ii) industrial businesses. Branded consumer businesses are those businesses that we believe capitalize on a valuable brand name in their respective market sector. We believe that our branded consumer businesses are leaders in their product categories. Industrial businesses are those businesses that focus on manufacturing and selling products and/or industrial services within a specific market sector. We believe that our industrial businesses are leaders in their specific market sectors.

The following is a brief summary of the businesses in which we own a controlling interest at December 31, 2025:

Branded Consumer Businesses

5.11

5.11 ABR Corp. ("5.11") is a global apparel, footwear, and gear company serving consumers who demand performance, durability, and versatility across work, training, and adventure. 5.11 is a brand known for innovation and authenticity and works directly with end users to create purpose-built apparel, footwear and gear designed to enhance the safety, accuracy, speed and performance of tactical professionals and enthusiasts worldwide. Headquartered in Costa Mesa, California, 5.11 operates sales offices and distribution centers globally, and 5.11 products are widely distributed in uniform stores, military exchanges, outdoor retail stores, its own retail stores and on 511tactical.com. We made loans to and purchased a controlling interest in 5.11 for approximately $408.2 million in August 2016. We currently own 97.8% of the outstanding stock of 5.11 on a primary basis and 87.6% on a fully diluted basis.

BOA

BOA Holdings Inc. ("BOA") creator of the award-winning, patented BOA Fit System, partners with market-leading brands to make the best gear even better. Delivering fit solutions purpose-built for performance, the BOA Fit System is featured in footwear across snow sports, cycling, outdoor, athletic, workwear as well as performance headwear and bracing. The system consists of three integral parts: a micro-adjustable dial, high-tensile lightweight laces, and low friction lace guides creating a superior alternative to laces, buckles, Velcro, and other traditional closure mechanisms. Each unique BOA configuration is designed with brand partners to deliver superior fit and performance for athletes, is engineered to perform in the toughest conditions and is backed by The BOA Lifetime Guarantee. BOA is headquartered in Denver, Colorado and has operations in Austria, Greater China, South Korea, Japan and Vietnam. We made loans to, and acquired a controlling interest in, BOA on October 16, 2020 for approximately $456.8 million. We currently own 91.4% of the outstanding stock of BOA on a primary basis and 82.8% on a fully diluted basis.

PrimaLoft

PrimaLoft Technologies Holdings, Inc. ("PrimaLoft") is a leading provider of branded, high-performance synthetic insulation and materials used primarily in consumer outerwear, and accessories. The portfolio of PrimaLoft synthetic insulations offers products that can both mimic natural down aesthetics and provide the freedom to design garments ranging from stylish puffers to lightweight performance apparel. PrimaLoft insulations also offer superior economics to the brand partner and enable better sustainability characteristics through the use of recycled, low-carbon inputs. We made loans to, and purchased a controlling interest in, PrimaLoft on July 12, 2022 for approximately $541.1 million. PrimaLoft is headquartered in Latham, New York. We currently own 90.7% of the outstanding stock of PrimaLoft on a primary basis and 84.7% on a fully diluted basis.

The Honey Pot Co.

The Honey Pot Co. is a leading “better-for-you” feminine care brand, powered by plant-derived ingredients and clinically tested formulas. Founded in 2012 by CEO Beatrice Dixon, The Honey Pot Co. is rooted in the belief that all products should be made with healthy and efficacious ingredients that are kind to and safe for skin. The Honey Pot Co. offers an extensive range of holistic wellness products across the feminine hygiene, menstrual, personal care, and sexual wellness categories. The Honey Pot Co.'s mission is to educate, support, and provide consumers around the world with tools and resources that promote menstrual health and vaginal wellness. Its products can be found in stores across the U.S. through mass merchants, drug and grocery retail chains, and online. We made loans to, and purchased a controlling interest in, The Honey Pot Co. on January 31, 2024 for approximately

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$380 million. The Honey Pot Co. is headquartered in Atlanta, Georgia. We currently own 85.0% of the outstanding stock of The Honey Pot Co. on a primary basis and 76.5% on a fully diluted basis.

Velocity Outdoor

Velocity Outdoor Inc. ("Velocity Outdoor" or "Velocity") is a leading designer, manufacturer, and marketer of archery products, hunting apparel and related accessories. The archery product category consists of products including Ravin crossbows and CenterPoint archery products, and the apparel category offers high-performance, feature rich hunting and casual apparel under the King's Camo brand, utilizing King’s own proprietary camo patterns. Velocity Outdoor offers its products through national retail chains and dealer and distributor networks. We made loans to, and purchased a controlling interest in, Velocity Outdoor on June 2, 2017 for approximately $150.4 million. Velocity Outdoor is headquartered in Rochester, New York. We currently own 99.4% of the outstanding stock of Velocity Outdoor on a primary basis and 93.2% on a fully diluted basis.

Industrial Businesses

Altor Solutions

FFI Compass, Inc. ("Altor Solutions" or "Altor") (formerly "Foam Fabricators"), headquartered in St. Louis, MO, is a designer and manufacturer of custom molded protective foam solutions and original equipment manufacturer ("OEM") components made from expanded polystyrene ("EPS") and other expanded polymers. Altor provides products to a variety of end-markets, including appliances and electronics, pharmaceuticals, health and wellness, automotive, building products and others. Altor’s molded foam solutions offer shock and vibration protection, surface protection, temperature control, resistance to water absorption and vapor transmission and other protective properties critical for shipping small, delicate items, heavy equipment or temperature-sensitive goods. Altor operates molding and fabricating facilities across North America, creating a geographic footprint of strategically located manufacturing plants to efficiently serve national customer accounts. We acquired Altor on February 15, 2018 for a purchase price of approximately $253.4 million. We currently own 99.3% of the outstanding stock of Altor on a primary basis and 90.5% on a fully diluted basis.

Arnold

AMT Acquisition Corp. ("Arnold") serves a variety of markets including aerospace and defense, general industrial, motorsport/ automotive, oil and gas, medical, energy, semiconductor and advertising specialties. Over the course of more than 100 years, Arnold has successfully evolved and adapted its products, technologies, and manufacturing presence to meet the demands of current and emerging markets. Arnold engineers solutions for and produces high performance permanent magnets (PMAG), stators, rotors and full electric motors (Ramco), precision foil products (Precision Thin Metals), and flexible magnets (Flexmag™) that are mission critical in motors, generators, sensors and other systems and components. Arnold has expanded globally and built strong relationships with its customers worldwide. Arnold is the largest and, we believe, the most technically advanced U.S. manufacturer of engineered magnetic systems. Arnold is headquartered in Rochester, New York. We made loans to, and purchased a controlling interest in, Arnold on March 5, 2012 for approximately $128.8 million. We currently own 98.0% of the outstanding stock of Arnold on a primary basis and 82.8% on a fully diluted basis.

Sterno

SternoCandleLamp Holdings, Inc. ("Sterno"), headquartered in Texarkana, Texas, is the parent company of Sterno Products, LLC ("Sterno Products") and Rimports, LLC ("Rimports"). Sterno is a leading manufacturer and marketer of portable food warming systems, creative indoor and outdoor lighting, and home fragrance solutions for the consumer markets. Sterno offers a broad range of wick and gel chafing systems, butane stoves and accessories, liquid and traditional wax candles, catering equipment and lamps through Sterno Products, as well as scented wax cubes, warmer products, outdoor lighting and essential oils used for home decor and fragrance systems, through Rimports. We made loans to, and purchased all of the equity interests in, Sterno on October 10, 2014 for approximately $160.0 million. Sterno offers a broad range of wick and gel chafing fuels, butane stoves and accessories, liquid and traditional wax candles, catering equipment and lamps through their Sterno Products division. In February 2018, Sterno acquired Rimports, a manufacturer and distributor of branded and private label scented wax cubes and warmer products used for home decor and fragrance systems. We currently own 98.4% of the outstanding stock of Sterno on a primary basis and 92.2% on a fully diluted basis.

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Our businesses also represent our operating segments. See “Our Businesses” and “Note R – Operating Segment Data” to our Consolidated Financial Statements for further discussion of our businesses as our operating segments, including information related to geographies.

Lugano

Lugano was an operating segment of the Company until November 16, 2025 when Lugano filed a voluntary Chapter 11 petition under the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware (the “Lugano Bankruptcy”) and, as a result, was deconsolidated. Lugano entered into an Agency Agreement with Enhanced Retail Funding, LLC (a Gordon Brothers affiliate – “Gordon Brothers”) in contemplation of a Chapter 11 filing on November 16, 2025 (the “Lugano Agency Agreement”). The bankruptcy court approved the Lugano Agency Agreement on an interim basis on November 20, 2025, with final approval granted on December 31, 2025. Pursuant to the agreement, Gordon Brothers acquired the right to sell specified Lugano assets, including merchandise. Under the Lugano Agency Agreement, Gordon Brothers effectively agreed to purchase the inventory of Lugano and operate the remaining retail stores through the bankruptcy period. Gordon Brothers issued a guarantee as to the amount that the bankruptcy estate would receive related to the inventory sale, with any upside to be apportioned pursuant to the terms of the Lugano Agency Agreement. Lugano is a designer, manufacturer, and retailer of high-end jewelry. Refer to “Note C – Deconsolidation” to our Consolidated Financial Statements for additional information concerning Lugano.

2025 Distributions

Common shares - For the 2025 fiscal year we declared distributions to our common shareholders totaling $0.50 per share. On May 27, 2025, in light of the Lugano Investigation and related matters, the Company announced that it suspended the quarterly cash distribution historically paid to common shareholders. No common distributions were paid subsequent to April 24, 2025.

Preferred shares - For the 2025 fiscal year we declared distributions to our preferred shareholders totaling $1.8125 per share on our Series A Preferred Shares, $1.96875 per share on our Series B Preferred Shares and $1.96875 per share on our Series C Preferred Shares.

WHERE YOU CAN FIND ADDITIONAL INFORMATION

We make filings with the Securities and Exchange Commission (the "SEC" or the "Commission"), including on Forms S-1 and S-3 under the Securities Act of 1933, as amended (the "Securities Act"), and on Forms 10-K, 10-Q, and 8-K under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), which include exhibits, schedules and amendments to those reports, as well as other filings required by the SEC. The SEC maintains an internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at http://www.sec.gov. In addition, copies of such reports, and amendments thereto, are available free of charge through our website at https://compassdiversified.com/ as soon as reasonably practicable after such documents are electronically filed with, or furnished to, the SEC.

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Organizational Structure (1)

Our Manager

Our Manager, CGM, has been engaged to manage the day-to-day operations and affairs of the Company and to execute our strategy, as discussed below. Collectively, our management team has extensive experience in acquiring and managing small and middle market businesses. We believe our Manager is unique in the marketplace in terms

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of the success and experience of its employees in acquiring and managing diverse businesses of the size and general nature of our businesses. We believe this experience will provide us with an advantage in executing our overall strategy. Our management team devotes substantially all of its time to the affairs of the Company.

We have entered into a management services agreement (the “Management Services Agreement” or “MSA”) pursuant to which our Manager manages the day-to-day operations and affairs of the Company and oversees the management and operations of our businesses. We pay our Manager a quarterly management fee for the services it performs on our behalf. In addition, certain persons who are employees and partners of our Manager receive a profit allocation with respect to the Allocation Interests. All of the Allocation Interests in us are owned by Sostratus LLC. Payment of profit allocations to Sostratus LLC can occur, if due pursuant to the profit allocation formula, for each of our subsidiaries during the 30-day period following the fifth anniversary of the date upon which we acquired a controlling interest in that business (a "Holding Event") and upon the sale of a subsidiary (a "Sale Event"). See Part III, Item 13. “Certain Relationships and Related Transactions, and Director Independence” for further descriptions of the management fees and profit allocations.

The Company’s Chief Executive Officer and Chief Financial Officer are employees of our Manager and have been seconded to us. Neither the Trust nor the LLC currently has any other employees. Although our Chief Executive Officer and Chief Financial Officer are employees of our Manager, they report directly to the Board. The management fee paid to our Manager covers all expenses related to the services performed by our Manager, including the compensation of our Chief Executive Officer and other personnel providing services to us. The LLC reimburses our Manager for the compensation and related costs and expenses of our Chief Financial Officer and his staff, who dedicate substantially all of their time to the affairs of the Company.

See Part III, Item 13. “Certain Relationships and Related Party Transactions, and Director Independence” of this Form 10-K and "Note T - Subsequent Events" included in the Notes to the Financial Statements in this Form 10-K for additional information concerning the MSA.

Market Opportunity

We acquire and actively manage small and middle market businesses. We characterize small to middle market businesses as those that generate annual cash flows of up to $100 million per year. We believe that the acquisition market for these businesses is highly fragmented and often provides opportunities to purchase at more attractive prices and achieve better outcomes for our shareholders. We believe this is driven by the following factors:

•third-party financing for these acquisitions is often less available or terms are less favorable for the borrower;

•sellers of these businesses frequently consider non-economic factors, such as legacy or the effect of the sale on their employees;

•these businesses are more likely to be sold outside of an auction process or as part of a limited process; and

•"add-on" acquisitions can often be completed at attractive multiples of cash flow.

Frequently, opportunities exist to support and augment existing management at such businesses and improve the performance of these businesses upon their acquisition through active management. We are business builders rather than asset traders. In the past, our management team has acquired businesses that were owned by entrepreneurs or large corporate parents. In these cases, our management team has frequently found opportunities to profitably invest in areas of the acquired businesses beyond levels that existed at the time of acquisition. In addition, our management team has frequently found that processes such as financial reporting and management information systems of acquired businesses may be improved, leading to improvements in reporting and operations and ultimately earnings and cash flow. Finally, our management team often acts as a business development arm for our businesses to pursue organic or external growth strategies that may not have been pursued by their previous owners.

Our Strategy

Our capital structure enables us to acquire, manage and grow attractive businesses that are leaders in their respective markets and to work closely with their management teams to drive operational improvements and long-term value creation. We actively invest in people, processes, and culture to strengthen our subsidiary companies and support growth initiatives, operational improvements and transformational change. We allocate capital to

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support long-term value creation, and we periodically adjust our priorities based on market conditions and our balance sheet objectives. In the near term, we expect to prioritize balance sheet strength and debt reduction, including through disciplined capital allocation and continued enhancements to our risk management, governance and oversight practices. We execute our strategy through two pillars:

•Subsidiary Value Creation: We focus on growing earnings and cash flow across our subsidiaries and help them professionalize at scale. We do this by strengthening operating capabilities, supporting organic growth initiatives, and working with management teams to identify and execute selective add-on acquisitions aligned with each business’s long-term strategy.

•Disciplined Acquisition Strategy: We apply a disciplined approach to capital allocation, prioritizing acquisitions that align with our core values and offer the potential for superior risk-adjusted returns and pursuing acquisitions selectively and consistent with our leverage and liquidity objectives.

Management Strategy

Our management strategy involves proactive financial and operational management and oversight of our subsidiaries to increase cash flows and enhance long-term shareholder value. In executing this strategy, we seek to promote timely and relevant reporting, accountability, and effective escalation practices across our subsidiaries, and we continually evaluate and refine these practices as our businesses evolve. Our Manager supports the management teams of each of our subsidiaries by, among other things:

•Recruiting and Retaining Talent: Supporting strong leadership teams through structured incentive compensation programs, including non-controlling equity ownership, tailored to each business.

•Instilling Financial Discipline: Regularly monitoring financial and operational performance and reinforcing accountability through clear metrics and monitoring practices.

•Strengthening Controls and Systems: Working to support the development and implementation of information systems, processes, and controls to enhance reporting, accountability, and decision-making.

•Supporting Growth Initiatives: Assisting management in their analysis and pursuit of prudent organic growth strategies and selective add-on acquisitions aligned with each business’s long-term goals.

•Improving Operating Efficiency: Working with management teams to identify opportunities to manage costs, right-size overhead, and improve productivity.

•Professionalizing at Scale: Supporting governance and operating practices that enable sustainable growth, including establishing subsidiary-level boards of directors and promoting transparency and periodic reporting and reviewing practices appropriate to each business.

While our businesses have different growth opportunities and potential rates of growth, our Manager works with the management teams of each of our businesses to pursue initiatives designed to enhance performance and increase cash flow, which may include:

•Selective capital investments to expand geographic reach, increase capacity, or improve cost structures.

•Investment in research and development for new products, services or processes to better serve customers.

•Strengthening sales and marketing capabilities to improve commercial execution.

•Improving operational efficiency and managing overhead costs to support scalable operations.

Ongoing Enhancements to Governance and Oversight

Our governance and oversight framework and financial reporting processes have supported our ability to manage a diverse group of subsidiary businesses over time. In light of the Lugano Investigation (as defined below) and the resulting restatement of our historical financial statements, we are implementing additional enhancements to our governance and oversight practices and, as appropriate, to financial reporting processes and internal controls. These enhancements are intended to further strengthen the quality and timeliness of information and to support earlier identification and escalation of issues across our subsidiaries. We cannot provide assurance that these enhancements will prevent all future issues. For more information regarding our controls and procedures see Part II, Item 9A. “Controls and Procedures”.

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Value-Driven Stewardship

We believe a values-driven approach to ownership and oversight supports long-term value creation. The Company seeks to be a responsible steward of the businesses we own, and we look to support subsidiary management teams in a manner consistent with our values.

In practice, our stewardship focuses on practices that support sustainable performance, including monitoring of operating and financial results and an emphasis on transparency and accountability.

Our stewardship approach includes:

•Ethical Conduct and Governance: Promoting a culture of integrity, transparency, and accountability, supported by appropriate policies, processes, and practices.

•People and Safety: Supporting practices that prioritize employee health and safety, development, and engagement.

•Environmental Responsibility: Encouraging prudent environmental practices appropriate to each business’s operations and industry.

•Stakeholder Focus: Fostering responsible decision making that considers the long-term interests of our businesses, employees, communities, and shareholders.

Acquisition Strategy

Our acquisition strategy is to acquire middle-market companies that we believe have durable competitive advantages and opportunities to gain share in attractive markets. We seek to acquire businesses capable of generating stable and growing earnings and cash flow over the long term. We generally pursue segment-level acquisitions in industries other than those in which our subsidiaries currently operate. We believe that attractive opportunities will continue to present themselves as private sector owners seek liquidity in long-standing and privately-held businesses and corporate parents divest their “non-core” operations.

Our ideal acquisition candidate has the following characteristics:

•a leading branded consumer, industrial, healthcare or critical outsourced service company headquartered in North America;

•defensible positions in the markets it serves and with its customers;

•favorable long-term macroeconomic and industry trends;

•a strong management team with meaningful incentives, either currently in place or previously identified;

•low risk of technological and/or product obsolescence; and

•a diversified customer and supplier base.

In addition to segment-level acquisitions, our subsidiaries often acquire and integrate complementary add-on businesses. We believe add-on acquisitions may improve financial and operational performance by enabling our businesses to:

•leverage manufacturing and distribution operations;

•leverage branding and marketing programs and customer relationships;

•add experienced management or management expertise;

•increase market share and enter new markets; and/or

•realize cost synergies through scale and improved management practices.

Sourcing and Execution

We benefit from our Manager’s ability to identify acquisition opportunities across a variety of industries. The Manager assists in sourcing, evaluating and negotiating potential acquisitions, including by conducting customary diligence and analysis appropriate to the nature and complexity of the target business and the transaction. This

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diligence process may involve a combination of internal review and third-party workstreams and may include an assessment of the target’s management team, operations, financial profile and industry dynamics, as well as negotiation of transaction terms and conditions. However, no diligence process can identify all risks or ensure that acquired businesses will perform as expected.

The process of acquiring new businesses is both time-consuming and complex and, historically, it has taken from two to twenty-four months to perform due diligence, negotiate and close acquisitions. The Manager may evaluate multiple transactions at different stages at any given time, and there may be periods during which the Manager does not recommend any new acquisitions. Any acquisition remains subject to review and approval by our Board, and our Board considers the Manager’s recommendations together with other information it deems relevant when evaluating such acquisitions.

Following an acquisition, we and the Manager work with the management team of the acquired business to develop and execute an operating plan aligned with our objectives.

Strategic Advantages

Based on the experience of our Manager and its ability to identify, evaluate, and negotiate acquisitions, we believe we have the capability to acquire and manage additional businesses that are consistent with our leverage and liquidity objectives and disciplined capital allocation. Our Manager maintains strong relationships with business brokers, investment and commercial bankers, accountants, attorneys, and other sources of acquisition opportunities, and has experience acquiring and managing small-to-middle-market businesses across industries, including in complex situations such as corporate spin-offs, transitions of family-owned businesses, management buyouts, and reorganizations.

We believe our sourcing capabilities and our extensive network provide access to a pipeline of potential acquisition targets. We also have access to third-party consultants and advisors who may assist in due diligence, transaction execution, and post-acquisition planning, as appropriate.

Finally, we believe our ability to finance acquisitions using capital resources raised at the Company level can reduce delays and closing conditions often associated with transaction-specific financing (for more information regarding our financing sources see the section titled “Financing” below).

Valuation and Due Diligence

Our Manager performs an evaluation process appropriate for the target business and the nature of the transaction, including an assessment of the target’s operations and the outlook for its industry. While valuation is an inherently subjective process, we evaluate potential acquisitions using a variety of analytical approaches, including:

•discounted cash flow analyses;

•evaluation of trading values of comparable companies;

•expected value matrices; and

•examination of comparable recent transactions.

As part of this process, our Manager develops projections of the expected cash flows and assesses the levels of risk associated with those projections. To assist us in evaluating key assumptions and assessing risks, we may engage third-party experts to review areas, such as legal, tax, regulatory, accounting, insurance and environmental matters and may also engage technical, operational or industry consultants, as appropriate.

A critical component of our evaluation of potential acquisitions is the assessment of the capability of the existing management team, including historical performance, expertise, experience, culture, and incentives. Where appropriate and consistent with our management strategy, we may seek to augment, supplement or replace existing members of management. We also consider the adequacy of a target’s information systems and reporting capabilities in light of the operating plan and integration strategy, and we may implement enhancements over time where appropriate.

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Financing

We incur third-party debt financing almost entirely at the Company level, which we use, together with our equity capital, to provide debt financing to each of our businesses and to acquire additional businesses. We believe this financing structure can be more efficient than each business borrowing directly from third-party lenders.

We intend to finance future acquisitions through cash on hand and, if necessary, additional equity and debt financings. We believe, and it has been our experience, that having the ability to finance our acquisitions with the capital resources raised by us, rather than relying on transaction specific third-party financing, can reduce delays and closing conditions. In certain circumstances, we may also pursue additional debt or equity financings, or offer equity, in order to fund multiple future acquisitions.

In connection with future acquisitions, we may provide a combination of equity capital and intercompany debt financing within the capital structure of the businesses we acquire, including debt funded at the Company level (for example, through our existing 2022 Credit Facility). This intercompany debt structure may allow us to distribute cash to the parent company through interest payments and scheduled principal amortization on these intercompany loans.

Debt Financing

2022 Credit Facility

On July 12, 2022, the LLC entered into the Credit Agreement to amend and restate its prior credit facility. The 2022 Credit Facility provides for (i) the 2022 Revolving Credit Facility and (ii) the 2022 Term Loan. Amounts outstanding under the 2022 Revolving Credit Facility mature on July 12, 2027. Borrowings under the 2022 Credit Facility bear interest at either a base rate or a term secured overnight financing rate (“Term SOFR”), plus an applicable margin that varies based on the Company’s Consolidated Total Leverage Ratio (as defined in the 2022 Credit Facility). The 2022 Credit Facility is secured by substantially all assets of the Company, including equity interests in, and loans to, its consolidated subsidiaries.

First Amendment of 2022 Credit Facility

On January 9, 2025, the LLC entered into a First Incremental Facility Amendment (the “First Amendment”) to the 2022 Credit Facility, which provided for (i) an additional $200.0 million advance under the term loan (the “Incremental Term Loan”) and (ii) delayed draw term loan commitments in an aggregate amount of $100.0 million (the “Incremental Delayed Draw Term Loan Commitments”). The proceeds were intended to be used for acquisitions, working capital, capital expenditures and other general corporate purposes. The Incremental Term Loan, together with the existing term loan, requires quarterly principal repayments commencing March 31, 2025, with the remaining principal and interest due on July 12, 2027. The Incremental Delayed Draw Term Loan Commitments were terminated prior to the end of the availability period in connection with Lugano-related events of default.

Forbearance Agreements and Related Amendments and Fifth Amendment

In 2025, in connection with the Lugano matters and related events of default under the 2022 Credit Facility, the LLC entered into a series of forbearance agreements and related amendments with the Administrative Agent and the required Lenders (the “Forbearance Agreements”). The Forbearance Agreements provided the LLC with time to complete the Lugano Investigation and restatement process and, among other things, limited revolver availability and uses of borrowings, removed the ability to borrow under the delayed draw term loan facility mentioned above, imposed cash disbursement controls and cash forecasting requirements, and limited certain restricted payments and management fee payments. Certain of the Forbearance Agreements also reduced the revolving commitments to $100.0 million. The Fifth Amendment described below formally waived all outstanding Lugano-related events of default that were outstanding prior to the Fifth Amendment.

On December 19, 2025, the LLC entered into a Fifth Amendment to the 2022 Credit Facility (the “Fifth Amendment”) and a related transaction letter (the “Transaction Letter”) with the Administrative Agent and the required Lenders. Among other things, the Fifth Amendment and Transaction Letter (i) waived certain Lugano-related events of default that were outstanding prior to the Fifth Amendment, (ii) set the aggregate revolving commitments at $100.0 million, (iii) revised pricing and certain financial and other covenant requirements, including revised financial covenant levels for periods after the quarter ended March 31, 2025, (iv) required repayment of 100% of net cash proceeds from certain dispositions and deleveraging transactions to repay indebtedness, and (v) imposed additional limitations on certain restricted payments and management fee payments, as well as enhanced reporting requirements, including

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periodic cash flow forecasting. The Transaction Letter also provides for milestone fees payable to the lenders if specified leverage thresholds are not achieved on certain dates.

At December 31, 2025, outstanding letters of credit under the 2022 Credit Facility totaled approximately $3.2 million and borrowing availability under the 2022 Revolving Credit Facility, as amended, was approximately $96.8 million.

Senior Notes

The Company has $1.0 billion aggregate principal amount of 5.250% senior notes due 2029 (the “2029 Notes”) and $300.0 million aggregate principal amount of 5.000% senior notes due 2032 (the “2032 Notes” and, together with the 2029 Notes, the “Notes”). The Notes are general unsecured obligations of the Company and are not guaranteed by the Company’s subsidiaries.

Indenture Forbearance Agreement and PIK Payments

In connection with the Lugano matters and related delayed periodic reporting during 2025, on August 29, 2025, the LLC entered into a forbearance agreement with certain holders of the Notes (the “Indenture Forbearance Agreement”), pursuant to which such holders agreed to forbear from exercising rights and remedies with respect to specified defaults relating to the Company’s failure to deliver certain financial statements within the time periods required under the senior note indentures. As consideration for the Indenture Forbearance Agreement, the Company agreed to pay (in kind) an upfront fee equal to 1.75% of the aggregate principal amount of Notes outstanding and additional interest at an incremental rate equivalent to 5.00% per annum for the period between August 1, 2025 and October 24, 2025 (together, the “PIK Payments”), which were effected through supplemental indentures dated September 9, 2025. The Company recognized $38.2 million in paid-in-kind interest related to the upfront fee and additional interest in connection with the Indenture Forbearance Agreement.

Equity Financing

Trust Common Shares

The Trust is authorized to issue 500,000,000 Trust common shares and the Company is authorized to issue a corresponding number of LLC interests. The Company will, at all times have an equal amount of LLC interests outstanding as Trust shares. At December 31, 2025, there were approximately 75.2 million Trust common shares outstanding.

At-the market program - common shares

On September 5, 2024, the Company refreshed its at-the-market program for the common shares of the Trust, which was initially established on September 7, 2021, by filing a prospectus supplement pursuant to which the Company may, but has no obligation to, issue and sell up to $500 million common shares of the Trust in amounts and at times to be determined by the Company. Actual sales will depend on a variety of factors to be determined by us from time to time, including market conditions, the trading price of Trust common shares and determinations by us regarding appropriate sources of funding.

In connection with refreshing the program, the Company entered into an Amended and Restated At Market Issuance Sales Agreement (the “Amended Common Sales Agreement”) with B. Riley Securities, Inc. ("B. Riley Securities"), Goldman Sachs & Co. LLC ("Goldman") and TD Securities (USA) LLC (each a “Common Sales Agent” and, collectively, the “Common Sales Agents”). The Amended Common Sales Agreement provides that the Company may offer and sell Trust common shares from time to time through or to the Common Sales Agents, as sales agent or principal, up to $500 million, in amounts and at times to be determined by the Company. Pursuant to the Amended Common Sales Agreement, the shares may be offered and sold through each Common Sales Agent, acting separately, in ordinary brokers’ transactions, to or through a market maker, on or through the New York Stock Exchange ("NYSE") or any other market venue where the securities may be traded, in the over-the-counter market, in privately negotiated transactions, in transactions that are deemed to be “at the market offerings” as defined in Rule 415 under the Securities Act or through a combination of any such methods of sale.

During the year ended December 31, 2025, there were no sales of Trust common shares under the Amended Common Sales Agreement.

During the year ended December 31, 2024, the Company sold 381,957 Trust common shares under the Amended Common Sales Agreement. For the same period, the Company received total net proceeds of approximately

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$8.4 million from these sales, and incurred approximately $0.1 million in commissions payable to the Common Sales Agents.

During the year ended December 31, 2023, there were no sales of Trust common shares under the Amended Common Sales Agreement as the at-the-market program for common shares was not active when the share repurchase program was active.

Trust Preferred Shares

The Trust is authorized to issue up to 50,000,000 Trust preferred shares and the Company is authorized to issue a corresponding number of Trust Interests. We issued 4,000,000 7.250% Series A Preferred Shares in 2017, 4,000,000 7.875% Series B Preferred Shares in 2018 and 4,600,000 7.875% Series C Preferred Shares in 2019.

At-the market program - preferred shares

On September 5, 2024, the Company refreshed its at-the-market program for certain preferred shares of the Trust, which was initially established in the first quarter of 2024, by filing a prospectus supplement pursuant to which the Company may, but has no obligation to, issue and sell up to $200 million of the Trust’s 7.250% Series A Preferred Shares (the “Series A Preferred Shares”), 7.875% Series B Preferred Shares (the “Series B Preferred Shares”), and 7.875% Series C Preferred Shares (the “Series C Preferred Shares” and together with the Series A Preferred Shares and the Series B Preferred Shares, the “Preferred Shares”), each representing beneficial interests in the Trust. The at-the-market program for Preferred Shares of the Trust was initially established on March 20, 2024 and allowed for the issuance and sale of up to $100 million of the Trust’s Preferred Shares.

In connection with refreshing the program, the Company entered into an Amended and Restated At Market Issuance Sales Agreement (the “Amended Preferred Sales Agreement”) with B. Riley Securities, Inc. (the “Preferred Sales Agent”). The Amended Preferred Sales Agreement provides that the Company may offer and sell Trust Preferred Shares from time to time through or to the Preferred Sales Agent, as sales agent or principal, up to $200 million, in amounts and at times to be determined by the Company. Pursuant to the Amended Preferred Sales Agreement, the shares may be offered and sold through the Preferred Sales Agent in ordinary brokers’ transactions, to or through a market maker, on or through the NYSE or any other market venue where the securities may be traded, in the over-the-counter market, in privately negotiated transactions, in transactions that are deemed to be “at the market offerings” as defined in Rule 415 under the Securities Act or through a combination of any such methods of sale.

The following table reflects the activity in the Preferred Share at-the-market program during the years ended December 31, 2025 and 2024 (in thousands, except share data):

During 2025, the Company sold Trust preferred shares under the Amended Preferred Sales Agreement as reflected in the table above. Beginning in April 2025, in light of the Lugano Investigation and related events, the Company discontinued sales under the Amended Preferred Sales Agreement for the remainder of fiscal year 2025.

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We intend to finance future acquisitions through cash on hand and, if necessary and when we determine we can efficiently access the capital markets, additional equity and debt financings. We believe, and it has been our experience, that having the ability to finance our acquisitions with the capital resources raised by us, rather than negotiating separate third-party financing specifically related to the acquisition of individual businesses, provides us with an advantage in acquiring attractive businesses by minimizing delay and closing conditions that are often related to acquisition-specific financings. In this respect, we believe that in the future, we may need to pursue additional debt or equity financings, or offer equity in Holdings or target businesses to the sellers of such target businesses, in order to fund future acquisitions.

Our Businesses

We categorize the current operating subsidiaries we own into two separate groups of businesses (i) branded consumer businesses, and (ii) industrial businesses. Branded consumer businesses are characterized as those businesses that we believe capitalize on a valuable brand name in their respective market sector. We believe that our branded consumer businesses are leaders in their particular product category. Industrial businesses are characterized as those businesses that focus on manufacturing and selling particular products and industrial services within a specific market sector. We believe that our industrial businesses are leaders in their specific market sector.

The following table represents the percentage of net revenue and operating income each of our businesses contributed to our consolidated results since the date of acquisition for the years ended December 31, 2025, 2024 and 2023, and the total assets of each of our businesses as a percentage of the consolidated total as of December 31, 2025 and 2024. The 2025 percentages for Net Revenue and Operating Income (loss) include Lugano through November 16, 2025, when Lugano filed for the Lugano Bankruptcy and was deconsolidated.

(1) Operating income (loss) reflected are calculated using the sum of segment operating income (loss) across the operating segments listed (excluding corporate expense) as the denominator.

Branded Consumer Businesses

5.11

Overview

5.11 is a global apparel, footwear, and gear company serving consumers who demand performance, durability, and versatility across work, training, and adventure. The brand was born in Yosemite on a climb rated 5.11. At the time, a

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5.11 rated climb was an impossible route, but every once in a while, a person with the right courage and preparation made it possible. That spirit of grit, discipline, and redefining limits has defined 5.11 from the very beginning.

What started on granite walls was later forged under far harsher conditions. As the brand earned the trust of elite military, law enforcement, and first responder communities, its products were pressure-tested in environments where performance is non-negotiable and reliability is assumed. This sharpened the brand’s ethos and raised the standard for what its products are expected to deliver.

Headquartered in Costa Mesa, California, 5.11 operates globally through retail stores, direct-to-consumer digital commerce, and select wholesale partners. The Company’s products are sold in 123 5.11-owned retail locations and through digital platforms, as well as through wholesale distribution in domestic and international markets. This diversified model enables broad consumer access while maintaining control over brand presentation, pricing integrity, and product experience.

History of 5.11

Born in Yosemite. Forged in Quantico. Built for Adventure.

5.11’s Yosemite roots established a standard that still guides the brand: 5.11 builds for the hard path - where preparation meets unpredictable conditions - and designs products that earn trust through sustained use. That standard, strengthened through co-creation and continuous improvement, lends professional validation to the brand’s credibility and raises expectations for quality, durability & reliability. Together, they form the foundation of a brand built for people who choose growth, not comfort.

This heritage gives 5.11 a level of authenticity that cannot be manufactured. That standard was later forged in Quantico and validated by adoption among military, law enforcement, and first responder communities. Working alongside demanding end users, 5.11 refined its product rigor through real-world testing, co-creation, and continuous improvement. This professional validation strengthened the brand’s credibility and raised expectations for quality, durability, and reliability.

Built for Adventure reflects the modern expression of the same mindset. Today’s consumers move fluidly across work, fitness, and self-chosen challenges. 5.11 is positioned as a premium brand for people who expect their gear to perform across the realities of their lives.

5.11’s brand platform, Challenge Possible, is a belief system grounded in preparation, effort, and earned progress. It unifies the brand across multiple pursuits from the city to the tree line, without fragmenting identity.

We acquired a majority interest in 5.11 on August 31, 2016.

Industry

5.11 participates in the global professional and consumer soft goods market for tactical gear and apparel. 5.11 products are designed for use in a wide variety of activities, from professional to recreational and outdoor and indoor, and can be used all year long. As a result, the markets and consumers 5.11 serves are broad and deep.

Products, Customers and Distribution

Products and Design Philosophy

5.11 designs apparel, footwear, and gear engineered to perform in demanding environments and endure sustained, real-world use. Products are developed through a disciplined process that is guided by the 5.11 FIVE.

1.Functional – every feature earns its place

2.Durable – built to last, tested to prove it.

3.Comfortable – movement, breathability, ease of wear.

4.Engineered Versatility - smarter materials, smarter construction, offers the capability for anything.

5.Stylish – confident, authentic, unmistakably 5.11

Across categories, the Company’s product standards emphasize quality and craftsmanship. Products are continually field tested, with feedback loops that sharpen performance and fit over time

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5.11’s purpose-driven approach, combined with a refined, premium aesthetic, results in products that consistently earn trust through performance over time.

Apparel - Apparel represents 5.11’s largest product category at 72%, 71% and 70%, respectively, of net sales for the years ending December 31, 2025, 2024 and 2023. Core categories include pants, outerwear, tops, uniforms, and technical layering systems designed to perform across work, training, and adventure environments. Apparel offerings reflect a premium brand position anchored in durability, material quality, and functional design.

Gear - Gear represented 18%, 19% and 19%, respectively, of 2025, 2024 and 2023 net sales, and includes packs, bags, load-bearing equipment, and accessories. Gear products are designed for modularity, durability, and long service life.

Footwear - Footwear represented 10% of net sales in each of the years ending 2025, 2024 and 2023 and includes duty footwear, training shoes, and adventure-oriented styles. Footwear products emphasize stability, comfort, durability, and traction across varied terrain and conditions.

Customers and Distribution Channels

Operating Model and Capabilities

5.11’s operating model is designed to support profitable growth, premium positioning, and operational discipline. The Company leverages data-driven inventory planning, lifecycle value management, and continuous improvement initiatives to balance growth with capital efficiency.

Professional Wholesale - Professional wholesale serves uniformed and institutional customers through specialized distributors, uniform dealers and direct agency relationships. This channel emphasizes solution-based selling, long-term partnerships, and co-created product development. Professional wholesale sales were 30%, 27% and 27% of net sales for the years ended December 31, 2025, 2024 and 2023, respectively.

Consumer Wholesale - Consumer wholesale expands brand reach through select partners aligned with 5.11’s premium positioning and performance standards.Consumer wholesale represented 5%, 6% and 6% of net sales for the years ended December 31, 2025, 2024 and 2023, respectively.

International - International distribution includes a combination of wholesale partners, distributors, and direct-to-consumer channels across approximately 100 countries.International sales represented 22%, 23% and 21%, for the years ended December 31, 2025, 2024 and 2023, respectively.

Stores and Digital (Direct-to-Consumer) - Direct-to-consumer includes company-owned retail stores, eCommerce and Amazon marketplace. Retail stores function as brand and community hubs, while digital channels enable scale, personalization, and direct engagement. 5.11 has significantly expanded its Direct-to-Consumer mix in the past five years, with DTC now comprising 42%, 43% and 45% of net sales for the years ended December 31, 2025, 2024 and 2023, respectively.

No individual customer represented greater than 10% of 5.11’s net revenues in 2025. As of December 31, 2025 and 2024, 5.11 had approximately $15.1 million and $23.9 million, respectively, in firm backlog.

Business Strategies

Growth Strategy

5.11’s growth strategy is designed to expand relevance while strengthening brand equity and operating discipline. The Company’s go-forward priorities include:

1.Deepen the Professional Business (Segment and Product Expansion) - Expand solutions and categories in the professional market. Strengthen long-term partnerships and continue co-creating products with demanding end users.

2.Expand Audience in High-Growth Lifestyle and Adventure Segments - Broaden reach among consumers seeking premium performance products for training, outdoor and adventure pursuits, and everyday utility.

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3.Build Brand Demand Through Community and Storytelling - Increase brand awareness and consideration by embedding in Trailblazer communities and elevating brand storytelling grounded in authentic heritage.

4.Scale Omnichannel With Discipline - Optimize the channel mix to protect brand presentation and pricing integrity while expanding consumer access.

Growth initiatives are designed to build upon authentic heritage and proven product capability, ensuring expansion remains credible, durable, and defensible.

Competitive Strengths

5.11 occupies a distinct position at the intersection of professional-grade performance and premium lifestyle relevance. Unlike brands built primarily on fashion cycles or marketing-driven narratives, 5.11’s differentiation is grounded in:

•Authentic heritage rooted in Yosemite and challenging what's possible.

•Professional validation earned through collaboration and adoption among demanding end users.

•Product standards centered on versatility, comfort, style, craftsmanship & quality. Engineered for performance rather than short-term trends.

•A unified platform designed to serve consumers across multiple pursuits.

This positioning allows the Company to participate in large and growing markets while maintaining a defensible brand foundation.

Competition

5.11 competes in the global marketplace for purpose-built technical apparel, footwear and gear. Management believes 5.11 has competitive advantages through its global omnichannel business model, which is comprised of a rapidly growing DTC channel and recurring Wholesale channel. 5.11 competes against activewear, outdoor and specialty apparel brands such as Nike, Under Armour, The North Face, Patagonia, Lululemon, Arc’teryx, Carhartt, Propper and Fecheimer Brothers. 5.11 competes with footwear brands such as Timberland, Bates and Danner, and with gear and bag brands such as Camelbak, Osprey and YETI. 5.11 also competes with specialty retailers such as REI, Dick’s Sporting Goods and Galls.

Suppliers

5.11 has built a supply chain that is optimized for its business, through which 5.11 controls the design, development and fulfillment of its products.

Sourcing and Supply Chain

5.11 partners with a diversified global network of suppliers and manufacturers to produce its apparel, footwear, and gear. 5.11 regularly sources new suppliers and manufacturers to support its ongoing growth and carefully evaluates all new suppliers and manufacturers to ensure they share its standards for quality and integrity. To mitigate supplier concentration risk, 5.11 commercializes its top key items at multiple factories to ensure it can balance geographic risks as well as respond quickly to spikes in business. 5.11 also continuously seeks out additional suppliers and manufacturers to enable contingency plans that minimize disruptions, as well as support its future growth.

All 5.11 products are manufactured by third-parties. 5.11 works with a group of 80+ vendors, 17 of which produced approximately 80% of its products in both 2025 and 2024. During the year ended December 31, 2025, approximately 35% of 5.11 products at cost were produced in Bangladesh, approximately 30% in Vietnam, and the remainder in Cambodia, Indonesia, Laos, China, Madagascar, United States, Philippines, Honduras, Mexico, Taiwan, Sweden, and Thailand.

The Company maintains a Vendor Code of Conduct that outlines expectations related to labor standards, workplace safety, environmental responsibility, and ethical business practices. Compliance is monitored through internal processes and continuous third-party audits and assessments. 5.11 operates under an ISO 9001-certified quality management system.

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Distribution

5.11 operates a distribution network designed to support omnichannel fulfillment and international growth. Distribution capabilities include centralized and regional facilities that support retail, wholesale, and direct-to-consumer channels.

Intellectual Property

5.11 protects its brand, product innovations, and proprietary designs through a combination of trademarks, patents, trade dress, and copyrights. 5.11 considers the 5.11 name and logo, as well as the Beyond Clothing name and logo, trademarks, together with 114 issued and pending patents and 726 registered and pending trademarks, both in the United States and internationally, to be among its most valuable intellectual property assets. The Company actively manages its intellectual property portfolio to protect brand integrity and competitive differentiation.

Regulatory Environment

The Company operates in a regulatory environment that includes product safety standards, import and export regulations, including applicable tariffs, labor laws, and environmental compliance requirements across the jurisdictions in which it operates. In the United States and the other jurisdictions in which 5.11 operates, it is subject to labor and employment laws, laws governing advertising, environmental and safety regulations, including those pertaining to perfluoroalkyl and polyfluoroalkyl substances (collectively known as “PFAS”), and other laws, including consumer protection regulations that apply to the promotion and sale of merchandise and the operation of fulfillment centers, anti-corruption laws and privacy, data security and data protection laws and regulations. Privacy and security laws, regulations, and other obligations are constantly evolving, may conflict with each other to complicate compliance efforts, and can result in investigations, proceedings, or actions that lead to significant civil and/or criminal penalties and restrictions on data processing. 5.11 products sold outside of the United States may be subject to tariffs, treaties, export compliance regulations and various trade agreements, as well as laws affecting the importation of consumer goods. 5.11 monitors changes in these laws and management believes that 5.11 is in material compliance with applicable laws. Failure to comply with these laws, where applicable, can result in the imposition of significant civil and/or criminal penalties and private litigation. A portion of sales generated by its International business is derived from sales to foreign government agencies, and management believes 5.11 is in material compliance with related applicable laws.

Human Capital

At December 31, 2025, 5.11 had 1,288 employees globally. 5.11’s teams embrace its Challenge Possible mindset, and its core values allow 5.11 to attract passionate and motivated employees who are driven to succeed.

BOA

Overview

BOA, creator of the award-winning, patented BOA Fit System, partners with market-leading brands to make the best gear even better. Delivering fit solutions purpose-built for performance, the BOA Fit System is featured in footwear across snow sports, cycling, outdoor, athletic, workwear as well as performance headwear and bracing. The system consists of three integral parts: a micro-adjustable dial, high-tensile lightweight laces, and low friction lace guides creating a superior alternative to laces, buckles, Velcro, and other traditional closure mechanisms. Each unique BOA configuration is designed with brand partners to deliver superior fit and performance for athletes, is engineered to perform in the toughest conditions and is backed by The BOA Lifetime Guarantee. BOA is headquartered in Denver, Colorado and has operations in Austria, China, South Korea, Japan and Vietnam.

History of BOA

BOA was founded in 2001 by Gary Hammerslag, a snowboarder, surfer, and entrepreneur. Gary moved to Steamboat Springs, Colorado in the mid-90’s after successfully selling his previous company, which created innovative catheter solutions that improved angioplasty procedure speed and effectiveness. After arriving in Steamboat Springs and frequently snowboarding, Gary envisioned a possibility to dramatically improve the fit and performance of snowboard boots by applying elements of his learnings in the medical device field. Gary developed a fit system as an alternative to traditional laces for snowboard boots and partnered with K2 and Vans to launch the first BOA-equipped snowboard boots to consumers in the winter of 2001. After a successful launch, BOA became widely adopted on snowboard boots.

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BOA’s next phase of growth was largely in the outdoor sporting and recreation markets. In 2005, BOA expanded its focus to hiking and trail-related footwear, followed by cycling and golf in 2006 and hunting and fishing in 2007, at which point BOA surpassed 1 million users worldwide. From 2008 to 2011, having gained credibility in consumer markets, BOA introduced products for the workwear footwear market as well as products for the medical bracing market. In 2013, the company entered the running market, followed by court sports and training in 2019.

In 2019, BOA launched its state-of-the-art Performance Fit Lab ("PFL") to quantitatively measure the impact of BOA-equipped performance footwear with elite athletes. The PFL’s purpose is to push the limits of athlete performance through superior fit, performance and user experience by testing, refining and improving products in collaboration with BOA’s brand partners. BOA has conducted thousands of individual performance tests since the lab opening, proving and informing future innovation.

In 2023, BOA successfully launched alpine downhill ski boots. The expansion into new industries and geographies coupled with the scientifically proven performance improvements has resulted in BOA surpassing 26 million systems sold worldwide in 2025.

We purchased a majority interest in BOA on October 16, 2020.

Industry

BOA participates in the global performance footwear, helmet and bracing markets representing an addressable market of 750+ million units sold annually in over 40 countries. The addressable market includes Snowsports (Alpine Ski, Snowboarding, and Cross-Country boots plus Helmets), Athletic (Golf, Court Sports, Running, and Training footwear), Outdoor (Trail, Hiking, Trekking, and Mountaineering boots/shoes), Cycling (Footwear and Helmets), Workwear (Footwear and Helmets), and Performance Bracing. BOA partners with the leading premier brands to integrate their system into their best gear.

Products, Customers and Distribution Channels

Products

The BOA Fit System consists of a durable lace, which is guided by low-friction guides and attached to a dial that is typically mounted on the footwear heel, tongue, or eye-stay for micro-adjustability to enhance performance fit. BOA’s current product portfolio has seven platforms, H+, H, M+, M, L+, L and S-Series, which vary in cost, weight, tension, and use case. Each dial design can be customized with numerous color choices allowing the product to fit cohesively with each brand partners’ specific designs and colorways.

All platforms share the distinctive characteristics that differentiate BOA from competing offerings: micro-adjustability to achieve the perfect fit, measurable performance benefits validated by Boa's Performance Fit Lab "(PFL"), durability and quality proven in extensive field testing, a lifetime guarantee on the end-product’s dial and laces, and the distinctive BOA sound heard when turning the dial.

Each platform is designed and engineered to address the specific performance fit needs of the end user by use case. Factors such as size and shape of dial, level of torque, internal mechanics, and weight vary amongst platforms, and each platform is further segmented into product collections that differ in aesthetic, optimal placement on the shoe, and cost. Within each product collection, dial designs and materials differ to accommodate preferences of the end user and retail price points of the end product.

Customers and Distribution Channels

BOA has approximately 300 global brand partners, including leading footwear companies such as Adidas, ASICS, Yonex, New Balance, Marucci, Descente, Ecco, Fila, FootJoy, Specialized, Shimano, Scott, Fizik, Trek, Fox, Burton, K2, Vans, Salomon, Atomic, Fischer, Nordica, Tecnica, Kailas, La Sportiva, Scarpa, Black Yak, Sievi, Red Wing, Timberland, Ariat, Strauss, ELTEN and Jalas who feature BOA Fit Systems across key industries and geographies. BOA typically sells directly to the manufacturing partner responsible for final assembly of the brand partner’s product. BOA works with 500+ brand partner factories with limited revenue concentration. Most brand partner factories are located in Asia, primarily in China and Vietnam, and are in relatively close proximity to BOA’s supply chain.

BOA actively collaborates with its brand partners to create innovative, performance-driven footwear, helmets and bracing. BOA contributes substantial design and testing resources to ensure its system is used in a way that

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maximizes performance based on dial placement and configuration. The BOA Fit System is not simply a “lace replacement” or plug and play option, but rather a solution that must be integrated into each product model through a 6-18 month development cycle to create an application that works specifically with a product’s unique structural design. This process allows BOA to ensure brand image consistency, end product quality and the best performance fit.

Footwear and headwear products featuring BOA systems are primarily sold through brick-and-mortar sporting goods retailers, specialty sport retailers, online retailers, or brand partners’ owned retail and online channels. Management estimates that end consumption of BOA products is geographically diverse, with approximately 17% of products consumed in North America, 38% in Europe, and 45% in Asia.

No individual customer or brand partner factory represented greater than 10% of BOA’s net revenues in 2025. One individual customer represented approximately 10% and 11% of BOA's net revenues in 2024 and 2023. At December 31, 2025 and 2024, BOA had approximately $25.5 million and $23.0 million in order backlog, respectively.

Business Strategies and Competitive Strengths

Business Strategies

Continued Share Growth in Established Industries - BOA has and will continue to build its brand, innovative product solutions that deliver superior fit and performance for athletes and workers, operational excellence and partner relationships to expand penetration and capture additional share in key industries, including Workwear, Snowsports, Cycling, Outdoor, Athletic and Performance Bracing.

Competitive Strengths

Culture of Innovation and New Product Development - Management believes that there is a significant opportunity to continue advancing product offerings through its commitment to innovation. Product development and innovation are divided amongst (i) BOA’s internal innovation and evolution of its fit systems and platforms, refining and improving on the aesthetics, durability, user experience, and price/value, (ii) the design and engineering collaboration that BOA engages in with its brand partners for project and application-specific needs, and (iii) BOA’s advanced research through its PFL, which is transforming markets through innovative performance fit solutions that are scientifically tested and validated.

Deep Collaborative Partnerships – BOA has deep partnerships with the premier brands in every industry they compete within. They collaborate throughout the entire product lifecycle process, including product strategy, design and development, factory operational/service support, retail education, consumer warranty support, and marketing/demand creation. BOA has a high partner retention rate due to the depth and value of the relationships.

Premium Brand Position - BOA is focused on continuing to build awareness around its aspirational, global brand through content leadership, athlete endorsements, paid media, brand partner affiliations, retail engagement/ education and other business. BOA primarily increases awareness through direct-to-consumer marketing and co-marketing with its established brand partner relationships. BOA leverages athlete endorsements to further establish its positioning as a performance fit leader as well as drive cross-segment brand awareness. The company's tag line and positioning “Dialed in Precision Fit" showcases athletes performing at their peak both physically and mentally. BOA also relies on its trusted brand partners to increase BOA brand awareness. The company focuses its efforts on collaborating with brand partners who are innovative market leaders that meet BOA’s brand standards and align with BOA’s positioning as a high-performance, premium brand.

Technology Leader with Robust Patent Portfolio – BOA is a leader in performance fit innovation and has built a diverse global portfolio of issued and pending utility and design patents. Throughout BOA’s history, it has continually innovated on dial attributes including quick release, durability, manufacturing ease, and micro adjustability, in addition to integrated lace and lace guide designs and configurations critical to imparting precision fit and reduced friction. BOA’s engineering and technical expertise enables the development and production of performance fit solutions, allowing their brand partners to offer performance enhancing technology and product differentiation.

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Competition

BOA’s competition in the premium market can be segmented into three primary categories: (i) traditional laces (ii) non-mechanical lace alternatives (bungies, buckles, plastic lace locks, Velcro, and webbing) and (iii) competitive dial based systems. BOA estimates their share is less than 5% of the total addressable market and greater than 90% of the premium performance dial based fit system market.

Research and Development

BOA’s approach to new product development is a multi-stage, cross-functional process. For each new product introduction, BOA works closely with brand partners to identify or develop the best suited BOA solution, its optimal placement on the shoe (or other application), color and design specifications, and cost targets. On existing products, BOA is committed to continuous innovation, including key improvements such as lower installation costs for brand partner factories, thinner and sleeker product profiles for improved aesthetics, in field warranty rate reduction to approximately 0.5%, improved user experience, and the broadening of the platform suite to address key opportunities in alpine skiing, outdoor and helmets.

As part of BOA’s innovation strategy around improving fit, the company has invested in a state-of-the-art PFL to quantitatively measure the impact of the BOA system on end products. The PFL is testing a significant number of products to evaluate Stability and Control, Power Transfer and Energy Efficiency. By addressing these global performance attributes rather than segment-by-segment specific needs, PFL findings will be relevant and applicable across BOA’s product lines. The results of these studies help further validate BOA’s value proposition, strengthening the company’s position as a fit and performance leader. Moreover, the PFL serves as a platform to test and refine new product offerings ahead of launch.

Suppliers

BOA maintains a longstanding deep relationship with a sole supplier for plastic injected parts (dial units and lace guides), representing approximately 70% of total purchases. The vendor is based in China with multiple facilities and established a new facility in Vietnam, diversifying its geographical footprint in 2024. Furthermore, the vendor has supplied the company since 2001 and has continuously invested in its tools and infrastructure to maintain quality standards and keep up with demand. BOA owns all its injection molds. Lastly, the vendor is also a minority shareholder in BOA and is committed to supporting its growth. The remainder of BOA’s purchases are for steel and steel coated lace, textile laces and guides, monofilament lace and webbing, which are sourced from China, South Korea, Europe, Thailand, and the Philippines. Management believes its manufacturing partners have sufficient capacity to accommodate future growth.

Intellectual Property

BOA has built a diverse global patent portfolio of 335 issued and pending utility patents and 173 issued and pending designs. The company currently has 49 active patent “families” as well as 35 active design “families” with intellectual property covering its core technology (dials, guides, laces), as well as strategic configurations and component installation methods. BOA maintains 196 registered and pending trademarks protecting 15 unique marks, with core marks filed in 40+ countries.

Seasonality

Due to the diversity of industries and geographies BOA participates in, there is no significant seasonality to the business.

Sustainability and Responsible Business Practices

As a forward-looking company, BOA sustainability efforts include minimizing impact on the environment, elevating the experience of staff throughout our supply chain, and working with community partners to diversify and promote access throughout Outdoor and STEM industries. BOA is working to reduce the use of virgin fossil fuel-based plastics, reduce overall manufacturing waste, and materially decrease our use of fossil-based energy. The company has made tangible progress in all three areas. BOA has formed partnerships with organizations across each region of operation focused on providing more access and opportunities to under-represented populations and protecting the environment. Through these programs BOA is working to create purposeful connections to their employees, partners, and consumers – bringing their mission, values, and products to the hearts and minds of their audience.

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Human Capital

BOA is an inclusive global team that trusts and cares for each other, their partners, the community, and the environment. Since their launch in Steamboat Springs, Colorado in 2001, BOA has maintained a strong and healthy company culture that is rooted in a passion for pioneering, and for making the best gear even better. As the team has expanded over the last 25 years, BOA has placed an emphasis on attracting, developing, and retaining a diverse and talented team. BOA employees are located in five countries and the United States. As of December 31, 2025, BOA had 277 full-time employees and 6 part-time employees. 142 employees are located in the United States and 141 work outside of the United States in Austria, China, Japan, South Korea, and Vietnam.

BOA is focused on providing greater access to careers and the outdoors, and providing BOA talent with opportunities to grow within the organization - providing career exposure programs, learning and development opportunities, targeted individual career plans, and building leadership development across all levels of the organization. BOA maintains a high employee retention rate and the leadership team strives to role model our values.

PrimaLoft

Overview

Headquartered in Latham, New York, PrimaLoft is a leading provider of branded, high-performance synthetic insulation used primarily in consumer outerwear and accessories. PrimaLoft was developed in 1983 as a division of Albany International Corporation (NYSE: AIN) in response to a U.S. Army request to develop a synthetic insulation for soldiers that replicated the warmth and weight characteristics of traditional goose down, but also remained warm when wet. Today, PrimaLoft’s products span a wide variety of highly engineered insulation fibers and gels that are used as ingredients for premium priced outdoor apparel (e.g., jackets, vests, pants, gloves, footwear, and hats) and home furnishings (e.g., comforters and pillows). PrimaLoft is differentiated based on its (i) leadership in synthetic insulation technology and sustainability, (ii) respected brand, (iii) robust product development and service model critical to brand partners, and (iv) respected legacy and high esteem with product design teams of aspirational brands. Most brand partners do not possess the same depth of internal expertise in synthetic insulation design and view PrimaLoft as an innovation and sustainability partner that enhances the parent brand in a manner consistent with increasingly eco-focused brand missions.

History of PrimaLoft

PrimaLoft was originally founded in 1983 after being approached by the U.S. Army Research Laboratory in Natick, Massachusetts. The U.S. Army was primarily interested in a synthetic insulation that would be comparable to goose down in weight, compressibility, and warmth, while also retaining heat in the presence of moisture. PrimaLoft was awarded its first patent for a “synthetic down” originally branded as PrimaLoft ONE in 1986. After initial success with military applications including sleeping bags and clothing systems, PrimaLoft entered the commercial market through partnerships with name brands like L.L. Bean, Land’s End, and Ralph Lauren. PrimaLoft quickly established its credibility for performance and quality and today continues to drive innovation within the synthetic insulation industry. A summary of key milestones in the company’s history is below:

•1984: Patented the first synthetic microfiber for apparel

•1989: L.L. Bean and Ralph Lauren become the first brand partners

•1990: PrimaLoft was used in the layering system for the Mount Everest Peace Climb

•1997: Developed first design using post-consumer recycled material

•2012: Separation from Albany International into a standalone company through a management buyout

•2017: Release of i) ThermoPlume, the most advanced, 100% recycled, down-like synthetic insulation alternative and ii) Aerogel technology, a lightweight, compression-resistant insulation composed of more than 95% air

•2018: Developed PrimaLoft® Bio™ technology, the first-ever biodegradable, 100% recycled synthetic insulation and fabric cross-product capabilities

•2019: Breakthrough development of P.U.R.E. manufacturing technology, a proprietary process of synthetic insulation that reduces carbon emissions by up to 50% or greater

•2020: Launch of Patagonia Nano-Puff with PrimaLoft P.U.R.E. technology

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•2021: Launch of Aerogel Footwear with Canada Goose

•2024: 70% of PrimaLoft® insulation products are made using 100% recycled content

•2025: Converted I-1001 Gold to P.U.R.E reduced emissions manufacturing

We acquired a majority interest in PrimaLoft on July 12, 2022.

Industry

PrimaLoft participates in the global insulation market for both apparel and bedding, which is estimated to encompass over $30 billion of annual spending. Within the overall insulation market, PrimaLoft competes primarily in premium positioned products where consumers value performance and sustainability.

Products, Customers and Distribution Channels

Products

PrimaLoft’s core product offering includes a wide range of insulation product types that are optimized to keep end consumers at a comfortable temperature, regardless of weather conditions. At the top end of the product range, PrimaLoft’s technically focused brand partners design each new outwear garment with specific performance goals or use cases in mind and aim to deliver the highest levels of warmth while also reducing product weight and maximizing product flexibility. PrimaLoft also delivers a broader menu of solutions to its brand partners that can address any product designer’s aesthetic vision (e.g., quilted/non-quilted, high/low loft, loose fill/batted rolls, etc.). PrimaLoft has been an early advocate of apparel sustainability, becoming the exclusive partner to some of the largest and most pioneering sustainability focused outdoor brands when they first undertook meaningful sustainability initiatives. Additionally, under its “Relentlessly Responsible” mantra, PrimaLoft has innovated low-emission manufacturing processes, incorporated high levels of recycled content into its product lineup, and continues to push the boundaries of apparel circularity via biodegradation and carbon-negative technologies. The ability of PrimaLoft’s product suite to address any and all brand partner goals, whether performance, aesthetic, or sustainability related, is a critical reason for PrimaLoft’s consistent market leadership in synthetic insulation over the past four decades.

Customers and Distribution Channels

PrimaLoft primarily works directly with over 900 active brand partners across North America, Europe, and Asia. PrimaLoft maintains highly collaborative relationships with its brand partners, visiting most several times per year to introduce new innovations, generate new product ideas, and assist with integrating the latest PrimaLoft technologies into their outerwear lineups. The process of designing a jacket usually begins about 18 months before the jacket is intended to be sold at retail. PrimaLoft sales team members and engineers engage early in the process, assisting with garment design, construction, and analysis of key insulation performance attributes. After several rounds of sampling and iterating with PrimaLoft, the brand partner will finalize product bill of materials and quantities for its lineup. Outerwear featuring PrimaLoft is primarily sold through brick-and-mortar sporting goods retailers, specialty sport retailers, online retailers, or brand partners’ owned retail and online channels.

PrimaLoft had approximately $14.7 million and $13.8 million, respectively, in firm backlog orders at December 31, 2025 and 2024.

Business Strategies and Competitive Conditions

Business Strategies

Accelerate the Market Trends Away from Down Insulation - With the introduction of ThermoPlume and other down-like synthetic insulation solutions, PrimaLoft is well positioned to continue gaining market share as customers shift away from down insulation. This change is being driven by the following factors: (i) consumer pushback on traditional down products due to the widespread and well-publicized inhumane down harvesting practices; (ii) narrowing performance gap between synthetic and down; (iii) volatility and notably higher pricing for down insulation tied to commodity pricing of goose and duck meat; and (iv) limited design flexibility and loss of efficacy in wet conditions for down insulation makes synthetic more attractive to product designers.

Continued Development of Cutting Edge Insulation Technology - Over the past four decades, PrimaLoft has continuously improved its product offering to retain a leading position with regards to synthetic insulation

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technology. . With strong continued investment in new product development, we expect PrimaLoft innovations to push the boundaries of material science and expand the value provided to end consumers.

Competitive Strengths

PrimaLoft’s competitive advantages include: (i) four decades of brand equity built on technology leadership, that allows brand partners to command premium pricing and tell their sustainability story; (ii) deep insulation-specific material science expertise ranging from polymer innovation to manufacturing innovation to design integration; (iii) protected intellectual property and a proprietary supply chain; (iv) trusted long standing brand partner relationships for a critical but relatively small cost component of the overall product; and (v) scale (demand aggregation) to gain efficiencies at both the fiber and toll manufacturing stages of the supply chain.

Competition

PrimaLoft’s competition falls into two categories: (i) brand partner house insulation brands; and (ii) other third-party insulation manufacturers that service more than one outerwear brand. PrimaLoft is believed to be the largest third-party branded synthetic insulation provider to the apparel industry.

Research and Development

PrimaLoft adheres to a “Stage Gate” approach for developing new products, beginning with market needs and potential product solutions. PrimaLoft gathers market intelligence from published market research, industry contacts, R&D alliances and its internal product strategy and technical team to identify and develop innovative ideas to address market needs. Once defined, the team progresses through a series of “Stage Gates” that begin with innovation readiness and ultimately end with commercialized PrimaLoft branded products. In between, the “Stage Gates” address product testing and quality validation against internal and external requirements, supply chain sourcing and manufacturing, pricing constructs, marketing assets and selling strategy to address global market needs.

Suppliers

PrimaLoft leverages an asset-lite production model, relying on a global network of third-party chemical suppliers, extruders, and fiber mills strategically located near brand partner production facilities throughout Asia, Europe, and North America. PrimaLoft’s vertically integrated supply chain is a competitive advantage, allowing for customized solutions to brand partners. Beginning at the polymer level, PrimaLoft possesses expertise in optimizing enhanced performance polymers. At the fiber extrusion level, PrimaLoft has the ability to innovate and create novel fibers, which are then used as inputs to the textile process. PrimaLoft provides fiber requirements and formulations to its network of exclusive manufacturing partners, who then directly receive raw materials ordered by PrimaLoft. PrimaLoft oversees the manufacturing partner insulation production process, often with visits to facilities and continuous testing to ensure all insulation produced meets the performance and sustainability standards. Once produced, the manufacturing partners ship insulation to brand partner manufacturing facilities, often located near the toll manufacturer in Europe or Asia. The brand partner manufacturer then produces the final product before it is shipped back to the brand partner, to a retailer, or direct to a consumer.

Intellectual Property

In addition to its brand, customer relationships and scale, PrimaLoft also makes use of product patents and process trade secrets as additional barriers to entry and competitive moats. With a leading position in synthetic insulation, PrimaLoft has built a patent portfolio of more than 12 issued and pending patents in the United States and more than 70 patents issued internationally. In addition, PrimaLoft uses a variety of trade secrets typically covering specific insulation manufacturing processes. Lastly, PrimaLoft has more than 50 registered trademark applications and pending trademarks globally.

Seasonality

Due to the nature of insulated outerwear and the concentration of spending in the northern hemisphere, PrimaLoft typically sees approximately 65% of sales in the first half of the calendar year, which is when brand partners order components to be used in cold weather apparel that will be sold to end consumers in the subsequent fall/winter.

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Human Capital

PrimaLoft had 76 employees on December 31, 2025, 72 full-time employees and 4 part-time employees, with 35 employees located within the United States, 30 in China and the remainder in Europe and Vietnam. PrimaLoft's labor force is non-union. Management believes that PrimaLoft has a good relationship with its employees.

The Honey Pot Co.

Overview

The Honey Pot Co. is The Holistic Wellness Partner for Humans with Vaginas, with products powered by plant-derived ingredients and clinically tested formulas. The Honey Pot Co. is rooted in the belief that all products should be made with healthy and efficacious ingredients that are kind to and safe for skin. The company offers an extensive range of holistic wellness products across the menstrual, personal care, and consumer health and sexual wellness categories. The Honey Pot Co.’s mission is to educate, support, and provide consumers around the world with tools and resources that promote menstrual health and feminine wellness.

History of The Honey Pot Co.

The Honey Pot Co. was founded in 2012 and is headquartered in Atlanta, Georgia. The Honey Pot Co.’s Co-Founder and CEO, Beatrice Dixon, faced persistent vaginal health issues and struggled to find safe but effective solutions, motivating her to create home remedies in her kitchen. Over the next few years, Beatrice and her Co-Founder, Simon Gray, bootstrapped their way into a small business by selling her homemade solutions at local trade shows, and in 2017, they were noticed by the feminine care buyer at a leading mass retailer who put the brand on the map. By 2020, The Honey Pot Co. had secured full distribution with that mass retailer across multiple product categories and had begun selectively entering other retailers and channels, including grocery and drug. Since then, the business has built scale and a passionate customer base by “normalizing the normal” through its authentic brand voice and educational content. Today, The Honey Pot Co.’s products can be found in more than 33,000 retail stores across the U.S. and Canada, as well as online.

We purchased a majority interest in The Honey Pot Co. on January 31, 2024.

Industry

The Honey Pot Co. participates in the large and growing feminine care market, which is estimated to be approximately $9 billion in the U.S. at retail and has grown at a mid-single digits compound annual growth rate over the past 5 years. In 2024, The Honey Pot Co. launched its hydrating body washes, further expanding its addressable market by entering the multi-billion-dollar body care segment. The company’s wide array of wellness products appeal to women of all ages, and its markets enjoy little cyclicality given the highly consumable and non-discretionary nature of menstrual products and other personal care “essentials.” As a result, the markets and consumers The Honey Pot Co. serves are both resilient and broad-based.

Feminine care has long been a stagnant category rooted in shame, underpinned by a lack of education, and dominated by large, legacy brands. These legacy brands have historically focused on low-cost, low-quality conventional products typically containing rayon, bleached cotton, titanium dioxide, and “harsh” chemicals such as sulfates, parabens, and synthetic fragrances. In recent years, upstart brands providing clean-label products (largely using organic cotton, “free from” harsh chemicals) have gained traction, demonstrating a shift in consumer preferences towards more natural, “better-for-you" products. The industry has also seen an increased emphasis on education and awareness regarding menstrual health, breaking societal taboos and promoting open conversations. Younger Millennial and Gen Z consumers demand more from brands than prior generations did, and we believe legacy brands have struggled to genuinely connect with these younger, socially minded consumers. Across all segments of the feminine care category, “better-for-you” players have been growing at faster rates than the category. The Honey Pot Co., we believe, is well positioned to benefit from the continued adoption of “better-for-you” feminine care products given their large distribution footprint and growing brand awareness.

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Products, Customers and Distribution Channels

Products

The Honey Pot Co. has an industry-leading portfolio of efficacious, clinically supported products that make consumers feel comfortable and confident in their bodies. The company sells through three primary product categories: Menstrual, Personal Care and Consumer Health & Sexual Wellness.

Menstrual – The Honey Pot Co.’s largest product category, menstrual represented 63%, 56% and 49% of gross sales for the years ending December 31, 2025, 2024, and 2023, respectively. Launched in 2017, the company’s menstrual necessities portfolio includes Organic Cotton Standard (“OCS”) menstrual pad covers and liners, BPA-free OCS cotton tampons, and silicone menstrual cups. The Honey Pot Co. is most well-known for its innovative “herbal” pads, which are infused with a proprietary blend of essential oils and plant extracts - such as lavender, mint, and aloe vera - to moisturize, soothe, and provide a gentle, "cooling" sensation that helps users have a more comfortable period experience. The Honey Pot Co. also offers non-herbal pads and liners which also use a super soft OCS certified organic cotton cover and ultra-absorbent pulp core which ensures maximum comfort and minimal leakage.

Personal Care – Personal care represented 32%, 36% and 39% of gross sales for the years ending December 31, 2025, 2024, and 2023, respectively. Within this category, The Honey Pot Co. offers an assortment of feminine hygiene products and full-body wellness products. Launched in 2014, the company’s feminine hygiene portfolio includes feminine washes and wipes that are gynecologist-tested, hypoallergenic, kind to and safe for skin. The company’s daily sensitive intimate wash, for example, is formulated with plant-derived ingredients as well as lactic acid (which is naturally occurring in the vaginal environment), to help maintain a balanced pH range of 3.5-4.5, while also boosting moisture and soothing the skin while gently cleansing intimate areas. The company launched its full-body wellness portfolio in 2024 with three herbal-infused body cleansers formulated to match the skin’s natural pH range and provide superior skin hydration.

Consumer Health, Sexual Wellness, and Other – Consumer health and sexual wellness represented 5%, 8% and 12% of gross sales for the years ending December 31, 2025, 2024, and 2023, respectively. Launched in 2020 and 2021, respectively, The Honey Pot Co.’s consumer health and sexual wellness portfolio includes anti-itch and soothing creams, suppositories, lubricants, and other intimacy products.

Consumers

The Honey Pot Co.’s differentiated approach to marketing, consumer education, and community-building efforts have earned the brand a loyal, passionate consumer base. Although the company’s products speak to all women, The Honey Pot Co.’s consumers are predominantly younger, ethnically diverse, highly educated, and higher income. The company’s consumers derive joy from caring for their skin and are curious about integrating more natural products into their daily regimen. They are typically well informed about trends in personal care and holistic wellness, are engaged and vocal, and seek brands that cultivate a deep sense of trust and purpose.

Distribution Channels

As a digitally native brand with a retail-first strategy, The Honey Pot Co. uses an omnichannel distribution model across a network of nationwide retailers (84%, 89% and 95% of gross sales for the years ending December 31, 2025, 2024 and 2023, respectively) and eCommerce (16%, 11% and 5% of gross sales for the years ending December 31, 2025, 2024 and 2023, respectively).

The Honey Pot Co.’s products are sold across national retailers in the mass, drug, grocery, and specialty beauty channels. The Honey Pot Co. is an established brand in the mass channel with nationwide distribution for its most popular products. The company is a newer entrant into the drug, grocery, and specialty beauty channels with meaningful runway for growth via new door and SKU expansions. The Honey Pot Co. launched in Canada in 2024 and expects to leverage its strong domestic retailer relationships to further expand internationally.

The eCommerce channel includes sales through the company’s owned website, Amazon, and other dotcom partners. Given the high cost of driving customers to its website, the company has historically leveraged its own website as a tool for customer education and new product testing rather than a purchasing destination. The company launched its Amazon storefront in June 2023 as a way to increase the availability and convenience of shopping this category for its consumers.

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Business Strategies and Competitive Conditions

Business Strategies

Increase Brand Awareness and Grow the Loyal Honey Pot Community – the company has the proven ability to build a loyal and passionate consumer base through its authentic brand voice, educational content, and safe and efficacious products. Although the company is a leader in the “better-for-you” category, it continues to meaningfully trail legacy players’ awareness levels. The coupling of low awareness with a loyal and passionate customer base presents a significant opportunity for accelerated growth through strategic increases in marketing spend targeted at bringing new consumers into the category and at increasing conversion of consumers from legacy brands.

Capitalize on Increasing Consumer Preference for “Better-for-You” Products – As a leading “better-for-you” feminine care brand, we believe that The Honey Pot Co. will enjoy an outsized benefit from consumers switching from legacy feminine care products to “better-for-you” alternatives. Younger consumers are increasingly searching for “clean-label” alternatives to products that typically contain “harsh” ingredients. This trend has been seen in the feminine care industry in the past years and may continue to accelerate as older generations age out of the category and younger consumers, who demand more transparency from their brands, enter the category. The Honey Pot Co. is, we believe, well positioned to be at the front of the “better-for-you” pack given their highly efficacious products and their unique value proposition of providing a complete, cross-category offering.

Expand Distribution Network to Drive Growth, Awareness, and Adoption – Meaningful opportunity exists for The Honey Pot Co. to expand its distribution footprint in existing channels where it remains under-penetrated and to enter entirely new channels and geographies with significant volume opportunities. The company has a successful track record of profitably expanding into new channels and significant opportunity exists both domestically and internationally. Accessibility remains a top hurdle for acquiring new customers, so expansion of the company’s distribution network presents an opportunity to further accelerate brand awareness and product adoption.

Leverage Brand Equity to Continue Developing New Products and Strategically Enter Large Adjacent Product Categories – The Honey Pot Co. aims to continue to strategically grow the product portfolio and bring newness to the category through meaningful innovation in core segments, supported by selective new product development in adjacent segments to grow The Honey Pot Co.’s addressable market. Opportunity exists for The Honey Pot Co. to expand its continuum of care to serve women at all life stages, ensuring consumers join the brand at a younger age and stay with the brand longer, thereby increasing consumer lifetime value.

Competitive Strengths

Authentic Brand with Distinct Marketing Strategy – The Honey Pot Co.’s differentiated marketing strategy is built upon three pillars: (i) education as a product, (ii) community as a connection, and (iii) storytelling as an approach. Educating the consumer is at the core of the marketing strategy because it helps break down the stigmas that have made feminine wellness historically difficult to discuss. The company’s humorous and cheeky brand voice lightens and normalizes topics left unaddressed by legacy education channels (e.g., doctors, schooling, etc.). Their bold, honest, and relatable digital content fosters community learning and especially connects with younger consumers, who are much less inhibited in discussing personal topics with friends and family and who expect more authenticity from brands than prior generations did.

Safe, Efficacious, and Clinically-Tested Products – Creating safe and trusted products is core to The Honey Pot Co.’s brand and is one of the key drivers of the company’s leading retention and preference metrics. The company enables consumers to enjoy better-for-you ingredients without sacrificing product performance and provides consumers with differentiated functional benefits (pH balanced, microbiome friendly, safe for sensitive skin, etc.). Furthermore, the company has rigorous processes in place to ensure product efficacy and safety, including conducting consumer perception tests on the majority of its products.

Focus on Holistic Wellness – The Honey Pot Co. is the first feminine care brand to cross the aisle and provide consumers with a complete feminine care system (e.g., washes, wipes, and menstrual products, etc.), differentiating it from legacy brands who focus strictly on one category; the company provides consumers with a one-stop-shop for all feminine care needs, thereby increasing consumer loyalty. The Honey Pot Co. focuses on launching products that work together to create a holistic wellness routine, increasing cross-sell opportunities and providing a competitive edge when competing to own consumers’ entire personal care journey.

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Competition

The Honey Pot Co. primarily competes in the United States feminine care marketplace, which is comprised of large established brands that account for more than half of the category and a long tail of smaller “better-for-you” players that have been growing rapidly. Within the feminine care market, several distinct segments exist (each with their own set of established players), including (i) menstrual products; (ii) feminine hygiene products, and (iii) consumer health and sexual wellness products. The primary legacy competitors include Always, Tampax, Kotex, and Playtex (menstrual); Summer’s Eve and Vagisil (feminine hygiene); and Monistat and KY (consumer health and sexual wellness), among others. In recent years, upstart brands providing “better-for-you” products have gained traction, including Cora, Lola, and This is L., among others. The Honey Pot Co.’s full body wellness products compete against many established and upstart personal care brands such as Dove, Olay, Aveeno, Native and Lume, among others.

Suppliers

The Honey Pot Co. utilizes an end-to-end, asset-light global supply chain leveraging multiple co-manufacturers, raw material vendors, and packaging suppliers.

Sourcing and Manufacturing

The Honey Pot Co. has a current network of eight co-manufacturers across the globe. The company has purposefully chosen suppliers with small, medium, and large lines and facilities, allowing the company to quickly scale with the same partner. The Honey Pot Co. has supply agreements in place and renegotiates rates, lead-times, and minimum order quantities with partners based on volumes to continually optimize its stock model parameters.

Distribution

The Honey Pot Co. contracts with a leading logistical provider to operate a dedicated distribution center in Memphis, Tennessee to support its fulfillment needs across North America.

Product Development

The Honey Pot Co. has a robust new product development process that is stage gated to ensure product viability in both market fit and economic terms. The company’s ideation process is driven by the needs of their consumer community, incorporates extensive 360-degree consumer research (including whitespace consumer studies), and most importantly, focuses on bringing products to market that address the long-term holistic health of all humans. The company formulates products in collaboration with industry experts and suppliers to ensure that the products strictly adhere to their brand standards of high quality and efficacy and with their retail partners to ensure that the products will resonate with shoppers. The company then clinically tests their formulations (to ensure compliance with regulatory standards) to confirm that the products are safe and efficacious. Lastly, the company validates their supply chain to ensure they can properly manufacture each product in the short and long term without disruption or quality compromises.

New product development is underpinned by the company’s mission to create products that work together to create a holistic wellness routine and that address previously unmet and unacknowledged human needs. The company continues to develop innovations in its core categories as well as adjacent categories where their brand equity gives them permission to play.

Regulatory Environment

The Honey Pot Co. markets and distributes various feminine hygiene and consumer care products in the United States and Canada, including nonprescription medical devices, over the counter (“OTC”) drug products, dietary supplements, and cosmetics, which are subject to regulation by the U.S. Food and Drug Administration (“FDA”) as well as the Federal Trade Commission (“FTC”). As such, the company is governed by various laws and acts, including the Federal Food, Drug and Cosmetic Act (“FDCA”), the Fair Packaging and Labeling Act (“FPLA”), and The Modernization of Cosmetics Regulation Act (“MoCRA”).

The Honey Pot Co.’s products fall into five different FDA classifications. Menstrual pads and liners are classified as class I medical devices; lubricants, tampons and cups are classified as class II medical devices; anti-itch spray, anti-itch and hemorrhoidal wipes are classified as OTC drug products, supplements are classified as dietary supplements, and feminine washes and wipes (excluding OTC wipes), deodorant sprays, suppositories, and body washes are classified as cosmetics.

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Under the FDCA and its implementing regulations, The Honey Pot Co. is subject to requirements related to, among other things, facility registration, drug and device current good manufacturing practices, product ingredients review, nonclinical and clinical testing, complaint handling and adverse event reporting, product recalls, product labeling, marketing, and promotion. Advertising and promotion are also regulated by the FTC under the FPLA and 15 U.S.C. § 52.

MoCRA, which went into effect in December 2023, imposes a wide range of new requirements on cosmetic industry stakeholders, including requirements for cosmetic product manufacturers and processors, subject to certain exemptions, to register their facilities with the FDA and list each marketed cosmetic product and all product ingredients with the FDA. MoCRA also imposes several other new requirements, including with respect to adverse event reporting, safety substantiation for cosmetic products, and labeling.

The Honey Pot Co.’s outside general counsel and regulatory counsel work with the company’s in-house product development and compliance teams to ensure products and the associated product claims and marketing are compliant with the standards set by relevant regulatory bodies, including FDA, MoCRA, and FTC. The company leverages their contract manufacturing partners for products that require 510(k) FDA notification, and the co-manufacturers are responsible for confirming that products are covered by the filings.

Community Engagement and Social Impact

Inclusion and social impact are key values of the company’s brand and community. Notably, The Honey Pot Co. donates 2% of their owned website sales annually to charitable organizations that share their mission of democratizing wellness by providing access to the educational content, resources, community, and products women need to be the healthiest and most confident versions of themselves. To further support equitable access to feminine care, The Honey Pot Co. has implemented a policy of reimbursing consumers (upon proof of purchase) for sales tax on their menstrual products (sometimes called a “tampon tax”) given that other “essential” consumer products, such as aspirin and antacids, are sold tax-free.

Human Capital

The Honey Pot Co. employs a non-union labor force of 72 employees who primarily work remotely across the United States. The company has an office in Atlanta, Georgia where a small group of employees work on a day-to-day basis, but this space is primarily used as a gathering place to host customers and team meetings. Over the past three years, The Honey Pot Co. has meaningfully invested in the infrastructure of the business to support its growth initiatives.

Velocity Outdoor

Overview

Velocity Outdoor is a leading designer, manufacturer, and marketer of archery products, hunting apparel and related accessories. The archery product category consists of products including Ravin crossbows and CenterPoint archery products, and the apparel category offers high-performance, feature rich hunting and casual apparel under the King's Camo brand, utilizing King’s own proprietary camo patterns. Velocity Outdoor offers its products through national retail chains and dealer and distributor networks. Velocity Outdoor is headquartered in Rochester, New York.

History of Velocity Outdoor

Velocity was founded in 1923 as Crosman Rifle Company and was one of the first manufacturers of recreational airguns in the United States. In 2008, Velocity diversified their product offerings by adding Crosman Archery to its list of branded products and introduced two new hunting crossbows in addition to youth archery products. In 2016, Velocity debuted its CenterPoint line of crossbows and with the 2018 acquisition of Ravin Crossbows, Velocity expanded their archery product line into the higher-end segment of the crossbow market. In July 2022, Velocity acquired Kings Camo LLC which designs and sells high-performance, feature rich hunting and casual apparel of uncompromised quality, utilizing King’s own proprietary camouflage patterns. King’s target consumers are men, women and youth who are avid in their outdoor pursuits. In April 2024, Velocity Outdoor sold Crosman Corporation ("Crosman"), its airgun product division.

Today, Velocity Outdoor is an international designer, manufacturer, and marketer of archery products including the Ravin and CenterPoint crossbows and King's Camo hunting apparel.

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We acquired a majority interest in Velocity Outdoor on June 2, 2017.

Industry

Velocity Outdoor primarily competes within sub-segments of the broader outdoor recreational products industry, The archery equipment market is estimated by management to constitute approximately $770 million of annual manufacturers' sales, of which $500-$550 million is attributable to bows and $200-$250 million is attributable to related archery consumables. Vertical and compound bows, and crossbows each comprise about half of the category sales, with crossbows gaining share in recent years. Independent archery dealers account for 38% of Velocity's sales and big box specialty sporting goods retailers account for approximately 30% of consumer purchases from Velocity. Distributors, mass merchants, and online retailers make up the remainder of consumer sales.

The hunting apparel market is estimated by management to constitute $500 million of annual sales. Online retailers' sales account for approximately 54% of consumer purchases from Velocity, dealers and distributors account for 20% from velocity and big box specialty sporting goods retailers make up the remainder of consumer purchases from Velocity.

Products, Customers and Distribution Channels

Products

Velocity's product strategy encompasses producing high quality, feature-rich products recognized by consumers for their craftsmanship, value and building on a rich history to introduce innovative new products.

Archery Products - Velocity re-entered the archery market in 2016 with a product line anchored by the CenterPoint crossbow. CenterPoint has grown rapidly since it was launched to become a leading player in the crossbow category. CenterPoint acquired market share by offering features like an aluminum frame, higher shooting velocity, integrated string stops, a 4x32mm scope and shoulder sling at very competitive retail prices.

Velocity acquired Ravin Crossbows in 2018, further expanding its product line in the archery market. Ravin Crossbows is a leading designer, manufacturer and innovator of crossbows and accessories. Ravin primarily focuses on the higher-end segment of the crossbow market and has developed significant intellectual property related to the advancement of crossbow technology. In 2022 Ravin introduced a new compact, fast, powerful, and accurate crossbow, shooting arrows at speeds over 500 feet per second and featuring an exclusive, and industry first, compact electronic cocking/de-cocking mechanism.

Hunting Apparel - Hunting apparel is designed specific to the activity and varies by region and type of hunting. Hunting apparel includes, but is not limited to jackets, vests, pants, bibs, shirts, boots, base layers, socks, and gloves for men, women, and youth. Hunting apparel is typically: more durable and weather-resistant than regular clothing; designed with special features for the field and fitted to provide more flexibility and less restricted movement.

Customers and Distribution Channels

Velocity's products are sold across a mix of sales channels, including national retailers, distributors/dealers/regional chains, international distributors, and e-commerce. Over the last several years, management has successfully diversified both its sales channel composition and customer mix. Velocity's three largest customers represented 16%, 8% and 8%, respectively, of gross sales in 2025 represent Velocity's major sales channels; mass merchant, regional retail, and e-commerce.

Velocity had approximately $2.2 million and $1.0 million in firm backlog orders at December 31, 2025 and 2024, respectively.

Business Strategies and Competitive Conditions

Business Strategies

Continued Innovation in Existing Product Categories - Velocity plans to continue to build on its successful history of bringing new, technically superior products to market through leveraging its stringent product development

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process and a flexible supply chain. The company has near-term new product launches and existing product updates planned across all categories, including the highlights below.

•Archery - Innovation will continue to lead the way with new offerings in both the CenterPoint and Ravin product lines. Unequaled, game changing performance and accuracy is the industry leading ground Ravin owns and will continue to own well into the future with new product introductions scheduled for 2026 and 2027.

•Hunting Apparel - Technically advanced and thoughtfully designed clothing is what makes Kings a fast growing brand in its space. 2024 saw an expansion of offerings in historical categories along with new categories. 2026 and 2027 will see many more offerings including lifestyle, men’s, women’s, children’s, season specific, animal specific and new categories.

Expand into Adjacent Product Categories - Management believes that the company can leverage in-house manufacturing and sourcing partners to develop products in new categories that utilize Velocity's existing distribution network and brand strength.

Competitive Strengths

Innovation and Engineering Capabilities with Strong IP - Velocity is a consumer-focused organization with a deep understanding of its consumers. In addition, Velocity employs and retains engineers who are the most accomplished in Velocity's markets which, combined with an innovative culture, have created what we believe to be significantly differentiated, demonstrably superior products with strong intellectual property protection.

Leading Consumer Brands with Branding and Marketing Capabilities to Drive Consumer Awareness, Affinity, and Engagement - Velocity owns a portfolio of premium, iconic brands that are in a leading position in consumer awareness and affinity. These include the fast growing, super premium, and market disruptive brands like Ravin and King's Camo.

Broad Coverage of Consumer Segments and Price Points - Velocity’s portfolio of brands and product lines provides broad coverage of consumer segments and allows the business to position products with a combination of features and retail prices that appeal to all consumers in the category from recreational to avid.

Competitive Conditions

Archery - The archery market competes within a “good, better, best” spectrum. Velocity's CenterPoint product line, as a value-for-price, entry to mid-level brand, tends to lie between the “good” and “better” segments, competing with Barnett Outdoors, Killer Instinct, and PSE Technologies, among others. Consumers tend to make purchasing decisions based on brand awareness, reliability, customer service, and pricing. Although CenterPoint is a recent entry into the archery market, the brand has been able to outpace more established brands on the reliability, pricing, and service aspects to win market share. The Ravin product line has a higher price point and falls within the "best" segment for crossbows, competing with the higher end crossbows. Ravin entered the market in 2017 and management believes it has since become a top selling brand as measured by retail dollars.

Hunting Apparel – The hunting apparel market operates within a "good, better, best" spectrum, where consumers prioritize factors such as performance, durability, pricing, and brand reputation when making purchasing decisions. King's Camo addresses these needs with three distinct product tiers:

•Classic Series: Positioned within the "good" segment, the Classic Series offers a value-driven option for budget-conscious hunters seeking functional gear without compromising on quality.

•Hunter Series: As part of the "better" segment, the Hunter Series balances performance and price, offering versatility and durability for the everyday hunter.

•XKG Series: Positioned in the "best" segment, the XKG Series is designed for serious hunters who demand premium performance, innovative materials, and technical advantages.

Although King's Camo faces competition from both long-established and niche brands, King's Camo has steadily grown market share by emphasizing versatility, affordability, and tailored solutions for hunters across skill levels and budgets. By maintaining competitive pricing, reliable performance, and strong customer relationships, King's Camo continues to deliver products that resonate with the hunting community.

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Suppliers and Manufacturing

Suppliers

Velocity’s supply chain has both a domestic and foreign sourced component, where sourcing decisions are based on manufacturing expertise, cost, lead time, demand requirements as well as other factors. Finished goods manufacturing is balanced between domestic and offshore, largely from the Asia Pacific region. We believe there is ample capacity throughout the value-chain to fully support growth objectives.

Manufacturing

Velocity's product manufacturing is based on a dual strategy of in-house manufacturing and strategic alliances with select subcontractors and vendors. Velocity conducts its domestic manufacturing operations in an 85,000 square foot leased facility in Superior, Wisconsin.

Intellectual Property

Velocity Outdoor currently holds a portfolio of more than 20 registered trademarks and a patent portfolio of more than 40 issued patents with many more pending. Management considers its patent holdings, trademarked brand names, preeminent name recognition, ability to design game changing innovative products with overt benefits to the end user, and marketing expertise to be its primary competitive advantages.

Regulatory Environment

Crossbow hunting restrictions have become less stringent over the last several years. Since 2006, 13 states, including populous hunting states like Wisconsin, Pennsylvania, North Carolina, and recently Minnesota, have legalized crossbow hunting, while many others moved to relax restrictions through the opening of limited seasons or creation of exceptions to hunting restrictions for those with disabilities. Today only Oregon classifies crossbows as illegal but there is currently a proposal to allow crossbows during the all-weapon deer season in the eastern half of the state. Nearly 90% of all hunting permits are filed in states that currently allow crossbow hunting for at least part of the season. Although continued deregulation is expected, it likely will not be the largest driver for the crossbow category moving forward. Participation levels have steadily increased within the states. This, as well as consumer centric innovation that improves the hunting experience, will be the main drivers behind market growth.

Seasonality

Velocity typically has higher sales in the third quarter each year, reflecting the hunting season in most states.

Human Capital

Velocity had 163 employees on December 31, 2025, 145 full-time employees and 18 part-time employees, with all employees located within the United States. Velocity’s labor force is non-union. Management believes that Velocity has a good relationship with its employees.

Lugano

Lugano was an operating segment of the Company until the Lugano Bankruptcy on November 16, 2025, after which Lugano was deconsolidated. Lugano is a designer, manufacturer, and retailer of high-end jewelry. Following the deconsolidation of Lugano, the Company no longer operates in the jewelry business. Refer to “Note C – Deconsolidation” to our Consolidated Financial Statements for additional information concerning Lugano.

Industrial Businesses

Altor Solutions

Overview

Altor Solutions, headquartered in St. Louis, Missouri, is a dynamic, engineering-driven company whose goal is to design and produce superior products that help customers solve their needs for temperature-sensitive (cold chain) and protective packaging. Altor Solutions offers a diverse range of materials, including traditional plastics and sustainable, plant-based and paper-based options. Altor operates molding and fabricating facilities across North

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America, creating a geographic footprint of strategically located manufacturing plants to efficiently serve national customer accounts.

History of Altor Solutions

Altor Solutions was founded in 1957 and initially operated as a single manufacturing plant in St. Louis, Missouri, producing rigid foam plastics. Through the years, Altor expanded its geographic footprint, adding additional molding plants to its operation, as well as growing through acquisitions. Altor also opened two greenfield plants in Mexico to better serve their multinational manufacturing customers.

In July 2020, Altor acquired the assets of Polyfoam, a Massachusetts-based manufacturer of protective and temperature-sensitive packaging solutions for the medical, pharmaceutical, grocery and food industries, among others. In October 2021, Altor acquired Plymouth Foam, a designer and manufacturer of fabricated foam, custom protective packaging solutions and componentry. The company previously held a noncontrolling ownership interest in Rational Packaging. In July 2024, Altor acquired the remaining ownership interest and obtained 100% ownership of Rational Packaging. In October 2024, Altor acquired Lifoam, a leading manufacturer of temperature-controlled packaging products such as thermal shippers and refrigerant gel packs for the healthcare, commercial and retail industries. Today, Altor operates out of its corporate headquarters in St. Louis, Missouri and manufacturing facilities across North America.

We purchased Altor on February 15, 2018.

Industry

Altor competes in the broadly defined North American temperature-sensitive (cold chain) and protective packaging market which we estimate was approximately $8.0 billion in 2025, with foam materials making up the second largest component of this market. On the basis of product type, this market is segmented into rigid protective, flexible protective, and foam protective applications. Altor primarily competes in the North American foam protective packaging market which includes expanded polyurethane foams, loose fills, foam in place polyurethane, and molded foams products. Producers of molded foam products generally fall into two categories: block and shape. Block molders manufacture large blocks of EPS foam that are typically used as insulation in building products such as walls, roofs and floors and are closely tied to the construction market. Altor’s acquisition of Plymouth Foam entered the company into this category. Shape molding, the majority of Altor’s business, represents customized molded foam solutions for protective packaging applications, life science and perishable applications and internal parts and components for OEMs. Products made of EPS foam have broad applications across various end markets due to a unique combination of performance characteristics. The superior cushioning and barrier properties paired with insulating and hydrophobic properties make it an ideal lighter weight material for protective packaging of heavy or valuable goods as well as insulated shipping containers for temperature and moisture sensitive products.

Solutions, Customers and Distribution Channels

Solutions

Altor Solutions designs and manufactures a broad array of protective, cold chain, and sustainable solutions, as well as OEM components and fabricated products, serving diverse end markets. Through the acquisitions of Lifoam Industries and Rational Packaging, Altor has strengthened its leading position in temperature-sensitive and protective packaging, with a broad offering of traditional and sustainable options.

Altor Solutions’ custom-engineered solutions fall into six major categories: protective packaging, cold chain solutions, refrigerants, OEM parts and componentry, fabricated solutions and sustainable packaging. These products are used across a variety of end markets including appliances, temperature-sensitive pharmaceuticals and food, HVAC, home and office furnishings and building products among others.

Protective Packaging - Engineered for mechanical and physical impact protection, including solutions for appliances, furniture, HVAC, and sensitive shipments. The acquisition of Rational Packaging expands Altor’s capabilities in curbside-recyclable, paper-based solutions, replacing traditional plastics while maintaining high performance.

Cold Chain Solutions - A core focus for Altor, including insulated shipping containers, gel packs, and the newly introduced Bioffex®, a starch bio-based molded cooler. These solutions support specialty pharmaceuticals, healthcare, and perishable food logistics, reinforcing Altor’s leading market position in single-use pharma parcel

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shippers. The Altor Perishables segment enhances cold chain capabilities for perishable food distribution. These shippers can also be made in alternative materials, such as our BioEPS®, which is biodegradable to ASTM D5511 standards, and the previously-noted Bioffex®, a commercially compostable foam.

Refrigerants - Manufactured at six plants across the U.S., Altor offers a full range of phase change material (PCM) and water-based refrigerants in both bottles and pouches, meeting a variety of temperature requirements for pharmaceutical and food shipping applications.

OEM Parts and Componentry - Includes engineered solutions for automotive, appliances, and construction applications, ensuring lightweight, durable, and cost-effective alternatives to traditional materials.

Fabricated Solutions - Custom manufacturing through die cutting, saw cutting, and pressure cutting for medium to low-volume projects, catering to specialized industrial needs. Fabricated solutions represent a small portion of Altor overall net sales.

Sustainable Packaging - Altor leads in sustainability with solutions such as BioEPS®, a biodegradable solution as per ASTM D5511, and Bioffex, a plant-based molded packaging solution supporting circular economy initiatives. The introduction of BioEPS with up to 55% post-consumer recycled content demonstrates Altor’s commitment to reducing environmental impact. Altor also exhibits its commitment to circularity within its 19 plants by recycling its waste and offering post-consumer collection to be remolded into new parts.

Services

Altor Solutions provides industry-leading services to enhance product integrity, performance validation, and regulatory compliance, many of which are done by our in-house ISTA Standard 20 Certified lab.

Protective Packaging Services - Impact, drop, and vibration testing to ensure optimized protection.

Cold Chain Services - Thermal modeling, chamber testing, and qualification processes for temperature-controlled shipping solutions.

Market Categories

Altor Solutions operates across four primary market categories:

Altor Life Sciences – This category is focused on cold chain solutions for specialty pharmaceuticals and healthcare applications.

Altor Industrial – Encompassing appliances, HVAC, furniture, construction, and other industrial applications, primarily serving protective packaging needs.

Altor Perishables – Providing innovative cold chain solutions for seafood, meat, perishable and specialty foods, and grocery logistics.

Retail – Specializing in retail-driven temperature maintenance solutions, including reusable and single-use parcel shipping coolers and refrigerants.

Customers and Distribution Channels

Altor Solutions serves over 1,000 customers across diverse industries. With its leading position in single-use pharmaceutical parcel shippers, Altor remains at the forefront of temperature-sensitive logistics. Products are distributed through direct-to-customer channels and strategic distributor partnerships, ensuring flexibility and value optimization. Altor has maintained long-standing relationships with its top customers, often averaging ten or more years. Altor's three largest customers comprised approximately 16%, 21%, and 32% of net sales in the years ended December 31, 2025, 2024 and 2023, respectively.

Altor Solutions often maintains resin cost pass-through provisions with its contracted customers, allowing it to pass-through material resin price changes. Resin constitutes its primary raw material cost.

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The following table sets forth Altor's customer breakdown by sector for the fiscal years ended December 31, 2025, 2024 and 2023:

Business Strategies and Competitive Strengths

Business Strategies

Defend Market Position - As a leading supplier of custom molded foam solutions, management believes Altor enjoys strong brand awareness and a reputation for superior quality and service in the industry. In a market characterized by fragmented competition, Altor will continue to focus on providing a best-in-class suite of products and capabilities.

Remain Committed to Customers - Functional and error-free products are key considerations for its customers and Altor has maintained a disciplined approach to ensure its products meet the highest standard of quality. As a result of this strong quality assurance, Altor has had little customer attrition.

Pursue Selective Acquisitions - Altor Solutions views acquisitions as a potentially attractive means to expand its national footprint or broaden its current product offering. Management will continue to seek acquisitions of regional foam molders and other packaging suppliers where sales and operational efficiencies can be realized, and to diversify into packaging products other than molded foam.

Competitive Strengths

National Scale and Proximity to Customers - Altor Solutions maintains a footprint of manufacturing locations across North America. Facilities are strategically located near customers’ production locations enabling Altor to be one of only a few foam molders capable of serving large national accounts. Due to foam’s high volume-to-weight ratio, foam manufacturers generally confine product shipments to a 300-mile radius in which shipping costs are economically viable. Thus, Altor is uniquely positioned to provide multi-facility support to its largest customers who often have multiple manufacturing or distribution locations.

Engineering and Design Capabilities - Altor Solutions has three coordinated design and testing centers with experienced packaging and mechanical engineers who work closely with customers to support packaging design needs. Engineering services include optimizing molds to meet customer needs and address complex design requirements, identifying pre-manufacturing challenges, solving post-manufacturing issues, improving packaging processes and laboratory testing final designs. Early customer involvement and collaboration to develop packaging solutions has resulted in increased project win rates and better visibility into product development pipelines.

Competitive Dynamics

•Customer qualification and tooling considerations. In certain applications, customers may use molds and tooling designed for specific manufacturing equipment, and changes in suppliers may require requalification, retooling or additional testing depending on the application and customer requirements. As a result, customer purchasing decisions may consider factors such as quality, service levels, lead times, and total delivered cost, in addition to price.

•Cost considerations and performance requirements. In certain protective and cold chain applications, customers may require testing and qualification to validate that packaging solutions meet performance requirements. The time and expense associated with testing and qualification can vary by end market and application.

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•Manufacturing capabilities and investment. The molded foam industry requires specialized manufacturing equipment and process know-how. Establishing or expanding manufacturing capacity may require capital investment and time to achieve required performance and quality standards, and the timing and cost to do so can vary based on the products and end markets served.

Suppliers and Manufacturing

The primary raw materials that are used in production are plastic resins, such as EPS, expandable polypropylene ("EPP") and expandable polyethylene ("EPE"). In addition to plastic resins, Altor also purchases fabricating material including blocks of EPE and EPP foam, polyethylene and urethane, as well as other packaging materials including corrugate, boxes, paperboard, tape and plastic film. Altor purchases its materials from a combination of domestic and foreign suppliers and has maintained strong relationships with key resin suppliers for over 30 years. Adequate amounts of all raw materials have been available in the past, and Altor's management believes this will continue in the foreseeable future.

Altor maintains 19 manufacturing facilities across North America with 17 located in the U.S. and 2 in Mexico, as well as one non-manufacturing corporate headquarters. Given the high volume, low density nature of foam, Altor's manufacturing facilities are strategically located near its largest customers’ production locations to minimize freight and logistics costs. Altor's geographic footprint covers a large portion of the continental U.S. and Mexico. Each plant has a warehouse space for raw materials, supplies and finished goods. Several plants also use third-party warehousing to store stocking inventory. Altor uses common carriers to deliver finished product and in certain cases, some customers pick up directly from the plants.

Regulatory Environment

Altor's manufacturing operations and facilities are subject to federal, state and local environmental and occupational health and safety laws and regulations. These include laws and regulations governing air emissions, wastewater discharge and the storage and handling of chemicals and hazardous materials.

Human Capital

As of December 31, 2025, Altor employed 994 full-time employees. None of Altor's U.S.-based employees are subject to collective bargaining agreements. Under Mexican Federal Labor Law, 31 employees at the two Mexican manufacturing facilities are unionized. Altor believes its relationship with its employees is good.

Arnold

Overview

Headquartered in Rochester, New York, Arnold serves a variety of markets including aerospace and defense, general industrial, motorsport/transportation, oil and gas, medical, energy, semiconductor and advertising specialties. Over the course of more than 100 years, Arnold has successfully evolved and adapted its products, technologies, and manufacturing presence to meet the demands of current and emerging markets. Arnold has expanded globally and built strong relationships with its customers worldwide. As a result, Arnold provides its customers with new and innovative materials and solutions that empowers them to develop next generation technologies. Arnold is the largest and, we believe, the most technically advanced U.S. manufacturer of engineered magnetic systems. Arnold is one of two domestic producers to optimize, engineer and manufacture rare earth magnetic solutions. Arnold serves customers and generates revenues via four business units:

•PMAG - Permanent Magnets and Assemblies Group ("PMAG")- Arnold’s high performance permanent magnets have a wide variety of applications, mainly used for rotating electrical machinery such as motor and generators. Industries served include aerospace and defense, energy exploration, industrial, motorsport and medical.

•Electric Motors - Low-to-mid volume AC induction, Switched Reluctance, and Brushless DC stators, rotors, and rotor shaft assemblies. Finished motors range from under 1kW through 1MW for aerospace and defense, industrial, energy, hybrid electric platforms and energy exploration.

•Precision Thin Metals - Arnold's precision thin metals group ("Precision Thing Metals") produces thin and ultra-thin alloys that improve the power density electrical systems such as motors, generators, and transformers along with thin foils for other applications such as electromagnetic shielding, radio frequency

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shielding, lightweight structures, and implantable structures. Industries served include aerospace and defense, industrial, energy exploration, and medical.

•Flexmag™ - High quality flexible magnetic sheet and strip, Flexmag products not only are magnetic but their processing capabilities allow for loading of a variety of materials into their flexible sheet products. Industries served include protective magnetic barriers, electromagnetic shielding, radio frequency shielding, advertising specialties, industrial, medical, and transportation.

Arnold operates 11 manufacturing facilities worldwide but functions as One Arnold. The facilities are split under the four business units shown above along with prototyping and advanced technology development through its Technology Center. In 2024, Arnold consolidated two facilities in the United States and opened a new facility in Thailand. These facilities have significantly upgraded Arnold’s manufacturing capabilities.

History of Arnold

Arnold was founded in 1895 as the Arnold Electric Power Station Company. Arnold began producing AlNiCo permanent magnets in its Marengo, Illinois facility in the mid-1930s. In 1970, Arnold acquired Ogallala Electronics, which manufactured high power coils and electromagnets. During the following decades, Arnold made a series of acquisitions and partnerships to expand its portfolio and geographic reach.

In February 2007, Arnold Magnetic Technologies completed the acquisition of Precision Magnetics, which expanded its geographic footprint to include operations in Sheffield, England and Lupfig, Switzerland.  In addition, Arnold’s Lupfig, Switzerland operation is a joint venture partner with a Chinese rare earth producer. The joint venture manufactures RECOMA® Samarium Cobalt blocks for select markets. In 2016, Arnold developed and launched the world’s strongest Samarium Cobalt magnet grade, RECOMA 35E, that enables significant opportunity for increased performance in smaller packages, and at higher temperatures, with no trade off in stability.

In 2021, Arnold acquired Ramco Electric Motors, Inc. ("Ramco"), a provider of custom electric motor solutions for general industrial, aerospace and defense and oil and gas end markets. Ramco's complementary product portfolio allows Arnold to offer more comprehensive, turn-key solutions to their customers.

We purchased a majority interest in Arnold on March 5, 2012.

Industry

Permanent Magnets - There exists a broad range of permanent magnets which include Rare Earth Magnets and magnets made from specialty magnetic alloys. Magnets produced from these materials may be sliced, ground, coated and magnetized to customer requirements. Those industry players with the broadest portfolio of these magnets, such as Arnold, maintain a significant competitive advantage over competitors as they are able to offer one-stop shop capabilities to customers. Management believes that being a manufacturer of these magnets, subject to patent rights, is another critical market advantage.

Magnetic Assemblies - Arnold offers complex, customized value added magnetic assemblies. These assemblies are used in devices such as motors, generators, beam focusing arrays, sensors, and solenoid actuators. Magnetic assembly production capabilities include machined metal components, magnet fabrication, machining, encapsulation or sleeving, balancing, and field mapping.

Electric Motors – There exists a global demand for electric motors. Arnold is a manufacturer for low-to-mid volume AC induction, Switched Reluctance, and Brushless DC stators, rotors, and rotor shaft assemblies. Arnold works with companies of all sizes: from small businesses and medium-sized companies all the way to Fortune 500s. The industry exists wherever electrical energy needs conversion to mechanical use.

Precision Strip and Foil - Precision rolled thin metal foil products are manufactured from a wide range of materials for use in applications such as transformers, motor laminations, lightweight structures, shielding, and composite structures. They have the unique processing capability to roll foils as thin as 2.5 microns while providing critical heat treatment maintaining competitive material properties. Once completed the product is coated if necessary and is slit to the application width.

Flexible Magnets - Flexible magnet products span the range of applications from advertising (refrigerator magnets and displays) to medical applications (needle counters) to sealing and holding applications (door gaskets). Other applications include Electromagnetic or Radio Frequency Shielding for high end electronics.

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Products, Customers and Distribution Channels

Products

Permanent Magnets and Assemblies Group - Arnold’s PMAG is a leading global manufacturer of precision magnetic assemblies and high-performance magnets. The group’s products include tight tolerance assemblies consisting of many dozens of components and employing RECOMA® SmCo, Neo, and AlNiCo magnets. These products are sold to a wide range of industries including aerospace and defense, motorsport/ transportation, oil and gas, medical, general industrial, energy and semiconductors. Arnold has established a reputation in the magnetic industry as an engineering solutions provider, assisting customers to ensure their critical assemblies meet expectations. PMAG is Arnold’s largest business unit representing greater than 50 - 60% of Arnold sales on an annualized basis with a global footprint including manufacturing facilities in the U.S., U.K., Switzerland, and China.

Electric Motors - Arnold manufactures electric motors and related components for use in industrial, military, and aerospace applications and is typically approximately 20 - 25% of Arnold sales on an annualized basis. Arnold's Electric Motor division is a trusted partner, supplying high-quality, electrical components and assemblies to many well-known brands in the industrial and aerospace industries. Arnold's competent, trained staff are committed to engineering solutions together with its customers and ensuring their satisfaction. Applications for electric motors span all industries. Arnold is a trusted supplier for technologies such as hybrid and electric transportation motors, aerospace and defense power generation, HVAC fan motors, marine propulsions and stabilization technologies, vertical lift motors and many others.

Precision Thin Metals - Arnold’s Precision Thin Metals group manufactures precision thin strip and foil products from an array of materials and typically represents approximately 5 - 10% of Arnold sales on an annualized basis. The Precision Thin Metals group serves the aerospace and defense, power transmission, alternative energy (hybrids, wind, battery, solar), medical, security, and general industrial end-markets. Precision Thin Metals has developed unique processing capabilities that allow it to produce foils and strip with precision and quality that are unmatched in the industry (down to 1/10th thickness of a human hair). In addition, the group’s facility is capable of increasing production from current levels with its existing equipment and is, we believe, well-positioned to realize future growth. Precision thin metals are used in electrical steels for hybrid propulsion systems, electric motors, and micro turbines, electromagnetic and radio frequency shielding, batteries and military countermeasures, as well as other applications.

Flexmag - Arnold is one of two North American manufacturers of flexible rubber magnets for specialty advertising, industrial, medical, and reprographic applications. Flexmag typically represents approximately 10% of Arnold sales on an annualized basis. It primarily sells its products to specialty advertisers and original equipment manufacturers. With highly automated manufacturing processes, Flexmag can accommodate customers required short lead times. Flexmag benefits from a loyal customer base and significant barriers to entry in the industry. Flexmag’s success is driven by superior customer service, and proprietary formulations offering enhanced product performance.

Existing End-Markets

Aerospace and Defense - In the aerospace and defense sector, Arnold is selling electric motor components, magnets, magnetic assemblies and ultra-thin foil solutions. Specifically, in the aerospace industry, Arnold’s assemblies have been designed into products, which enables Arnold to benefit from the market growth and a healthy flow of business based on current airframe orders. Through its OEM customers, many new commercial aircraft placed in service contain assemblies produced by Arnold. Arnold’s sales to large aerospace and defense manufacturers includes magnetic assemblies used in applications such as motors and generators, actuators, trigger mechanisms, and guidance systems, as well as magnets for these and other uses. In addition, it sells its ultra-thin foil for use in military countermeasures, lightweight structures, brazing alloys, and motor laminations.

General Industrial - Within the industrial sector, Arnold provides electric motors, magnet assemblies as well as magnets for custom made motor systems. These include stepper motors, pick and place robotic systems, and new designs that are increasingly being required by regulation to meet energy efficiency standards. An example is a motor utilizing Arnold’s bonded magnets for use in commercial refrigeration systems. Arnold also produces magnetic couplings for seal-less pumps used in chemical and oil & gas applications that allow chemical companies to meet environmental requirements.

Motorsport / Transportation - Arnold produces high performance motor components and sub-assemblies for motorsport and transportation applications, such as the Kinetic Energy Recovery System, which includes a

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composite sleeved RECOMA® SmCo magnet rotor for a high speed, high power system and Electric Turbo Chargers that operate at greater than 100,000 RPM. Further emerging magnetic applications include electric traction drives, regenerative braking systems, starter generators, and electric turbo charging. As much of this technology utilizes magnetic systems, Arnold expects to benefit from this trend.

Other end markets - Arnold provides magnets and precision assemblies for use in oil and gas exploration and production, and magnetic assemblies, magnets, flexible magnets, and ultrathin foils in the medical sector. Arnold’s Precision Thin Metals group supplies grain-oriented silicon steel produced with proprietary methods for use in transformers and inductors. These cores allow for the production of very efficient transformers and inductors while minimizing size.

Customers and Distribution Channels

Arnold’s focus on customer service and product quality has resulted in a broad base of customers in a variety of end markets. The following table sets forth management’s estimate of Arnold’s approximate customer breakdown by industry sector for the fiscal years ended December 31, 2025, 2024 and 2023:

Arnold has a large and diverse, blue-chip customer base. Sales to Arnold’s top ten customers were 28% for the year ended December 31, 2025, 30% for the year ended December 31, 2024, and 29% of total sales for the year ended December 31, 2023. In 2025, 2024 and 2023, no individual customer represented more than 10% of Arnold's net revenues.

Arnold had firm backlog orders totaling approximately $113.9 million and $80.3 million, respectively, at December 31, 2025 and 2024.

Business Strategies and Competitive Strengths

Business Strategies

Engineering and Product Development - Arnold’s engineers work closely with the customer to provide system solutions, representing a significant competitive advantage. Arnold’s engineering expertise is leveraged with state-of-the-art technology across the various business units located in North America, Europe and Asia Pacific. Arnold’s engineers work with customers on a global basis to optimize designs, guide material choices, and create magnetic models resulting in Arnold’s products being specified into customer designs.

Arnold continues to be an industry leader with regard to new product formulations and innovations. As evidence of this, Arnold currently relies on a deep portfolio of “trade secrets” and proprietary intellectual property. Arnold continuously endeavors to introduce electromagnetic solutions that exceed the performance of current offerings and meet customer design specifications.

Growth in Arnold’s business is primarily focused in three areas:

•Growing market share in existing end-markets and geographies, with a focus on aerospace and defense, niche industrial systems, and oil and gas;

•Vertical integration through new products and technologies; and

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•Completing opportunistic acquisitions and partnerships to reduce product introduction and market penetration time.

Competitive Landscape

•Customer Qualification and Program Design Cycles. In certain applications, Arnold’s products may be specified into customer programs through co-development and qualification processes that can take several months or longer, depending on the application and customer requirements. As a result, once a supplier is qualified for a particular program, customer purchasing decisions may be influenced by performance, reliability, delivery, and ongoing engineering support, and changes in suppliers may require additional time and expense.

•Manufacturing and Processing Capabilities. The specialty magnet industry requires access to specialized manufacturing equipment, technical expertise, and process know-how. Establishing or scaling these capabilities may require meaningful capital investment and time to achieve required performance and quality standards and to develop customer qualifications. The timeframe required for a new entrant to compete effectively can vary materially depending on the target end market, the products involved, and customer requirements.

Suppliers and Manufacturing

Raw materials utilized by Arnold include neodymium, samarium, dysprosium, nickel and cobalt, stainless steel shafts, Inconel sleeves, adhesives, laminates, aluminum extrusions and binders. Although Arnold considers its relationships with vendors to be strong, Arnold’s management team also maintains a variety of alternative sources of comparable quality, quantity and price. The management team therefore believes that it is not dependent upon any single vendor to meet its sourcing needs. Arnold is generally able to pass through material costs to its customers and believes that in the event of significant price increases by vendors that it could pass the increases to its customers.

Arnold has a wide variety of manufacturing capabilities. For permanent magnets and assemblies our magnets are produced and fabricated utilizing personnel, skills, tools, and specific machinery to convert raw materials into finished magnet and then integration of those magnets and machines components into devices or sub-assemblies. Orders are all built to specific customer needs and distributed directly from our manufacturing facilities located worldwide.

Research and Development

Arnold has a core research and development team with extensive industry experience located at its Technology Center. In addition to the Technology Center, a large number of other Arnold staff members assigned to the business units contribute to the research and development effort at various stages. Product development also includes collaborating with customers and field testing. This feedback helps ensure products will meet Arnold’s demanding standards of excellence as well as the constantly changing needs of end users. Arnold’s research and development activities are supported by state-of-the-art engineering software design tools, integrated manufacturing facilities and a performance testing center equipped to ensure product safety, durability and superior performance.

Intellectual Property

Arnold currently relies on a deep portfolio of “trade secrets” and proprietary intellectual property. Arnold currently has 2 patents in force in the United States, 2 patents in force in Europe and 1 patent in force in Japan.

Arnold currently has 40 trademarks, 12 of which are in the U.S. The most notable trademarked items are the following: “RECOMA”, “PLASTIFORM”, “FLEXMAG” and “ARNOLD”. Application dates for various trademarks date back to as early as 1960.

Regulatory Environment

Arnold’s domestic manufacturing and assembly operations and its facilities are subject to evolving federal, state and local environmental and occupational health and safety laws and regulations. These include laws and regulations governing air emissions, wastewater discharge and the storage and handling of chemicals and hazardous substances. Arnold’s foreign manufacturing and assembly operations are also subject to local environmental and occupational health and safety laws and regulations. New requirements, more stringent application of existing

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requirements, or discovery of previously unknown environmental conditions could result in material environmental expenditures in the future.

Arnold is a major producer of both Samarium Cobalt permanent magnets under its brand name RECOMA® and Alnico (in both cast and sintered forms). Both materials from Arnold meet the current Berry Amendment or Defense Federal Acquisition Regulations Systems (DFARS) requirements per clause 252.225.7014 further described under 10 U.S.C. 2533b. This provision covers the protection of strategic materials critical to national security. These magnet types are considered “specialty metals” under these regulations.

Arnold has manufacturing facilities located in China and Switzerland, both of which have been the subject of tariffs and trade disruptions. Changes in the availability and price of raw materials, components and whole goods, which can fluctuate significantly as a result of economic volatility, regulatory instability or change in import tariffs or trade agreements, can significantly increase the costs of production and distribution, which could have a material negative effect on the profitability of the businesses.

Human Capital

Arnold is led by a capable management team of industry veterans that possess a balanced combination of industry experience and operational expertise. Arnold employed approximately 771 hourly and salaried employees located throughout North America, Europe and Asia at December 31, 2025. Arnold’s employees are compensated at levels commensurate with industry standards, based on their respective position and job grade.

Arnold’s workforce is non-union except for approximately 60 hourly employees at its Woodstock, Illinois facilities, who are represented by the International Association of Machinists (IAM). Arnold enjoys good labor relations with its employees and union and has a one year contract in place with the IAM, which expires in June 2026. The original three year contract was automatically renewed for one year in June 2025.

Sterno

Overview

Sterno, headquartered in Texarkana, Texas, is the parent company of Sterno Products, LLC ("Sterno Products") and Rimports, LLC ("Rimports"). Sterno operates through two product divisions:

•Sterno Products - Sterno Products manufactures and markets a broad range of wick and gel chafing fuels, liquid and traditional wax candles, butane stoves and accessories, and catering equipment and lamps for restaurants, hotel and home entertainment uses, selling both Sterno brand and private label. As a leading supplier of canned heat to foodservice distributors and foodservice group purchasing organizations, Sterno is always pursuing end-user solutions and innovations to strengthen its position in the marketplace.

•Rimports - Rimports manufactures and distributes branded and private label wickless candle products used for home decor and fragrance systems under the ScentSationals, and Fusion brands. Rimports offers unique lines of wickless candle products including ceramic wax warmers, scented wax cubes, fragrance oils, essential oils, and diffusers. Rimports also sells flameless candles, lanterns, and outdoor lighting. Sterno acquired Rimports in February 2018.

History of Sterno

Sterno’s history dates back to 1893 when S. Sternau & Co. began making chafing dishes and coffee percolators in Tenafly, New Jersey. In 1914, S. Sternau & Co. introduced “canned heat” with the launch of its gelled ethanol product under the “Sterno” brand. Since then, the Sternau and Sterno names have been the most well-known names in portable food warming fuel. In 1917, S. Sternau & Co. was renamed The Sterno Corporation. During World War I, Sterno portable stoves were promoted as an essential gift for soldiers going to fight in the trenches of Europe. Sterno stoves heated water and rations, sterilized surgical instruments, and provided light and warmth in bunkers and foxholes. During World War II, Sterno produced ethanol and methanol chafing fuels under contract with the U.S. military. In 2012, Sterno merged with the Candle Lamp Company LLC, a supplier of chafing fuel in addition to lighting products.

In 2016, Sterno expanded their product offering with the acquisition of Northern International Inc. ("Sterno Home"). The success in the outdoor lighting of an innovative use of LED technology evolved into the development of

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patented flameless candle product line. In February 2018, Sterno acquired Rimports, a manufacturer and distributor of branded and private label wickless candle products used for home decor and fragrance systems. Rimports offers unique lines of wickless candle products including ceramic wax warmers, scented wax cubes and essential oil and diffusers. In 2022, the combination of Sterno Home and Rimports created opportunities for cost savings and strong business synergies.

Today, Sterno operates out of its corporate headquarters in Texarkana, Texas, and has manufacturing and distribution facilities in multiple locations, including Memphis, Tennessee, La Porte, Indiana, Texarkana, Texas, and the Rimports facility in Provo, Utah.

We purchased Sterno on October 10, 2014.

Industry

Sterno Products competes in the broadly defined U.S. foodservice industry where historically restaurant, catering and hospitality sales have accounted for a majority of the market with the remainder comprised of retail, travel and leisure, education and healthcare related sales. The Sterno Products product offerings focus on safe, portable fire solutions for cooking and warming, as well as tabletop lighting décor.

Rimports operates in the broad North American and United Kingdom home decor space (retail) which is heavily correlated to general consumer spending. Flameless and reusable wax products have seen increased adoption by younger consumers who prioritize economical and environmentally friendly products. Within the home decor space, Rimports competes in the U.S. candle space and the U.S. home fragrance space, and, with the integration of Sterno Home, has added the flameless candles, lanterns and outdoor lighting industry. Management believes that a rise in demand from households and businesses will bolster growth, with consumers spending more money on beautifying their indoor and outdoor home, changing out trendy accent items more frequently and investing in more spacious and comfortable outdoor spaces with many equivalent amenities of their indoor spaces.

Sterno is a “full-line” supplier offering a broad array of portable chafing fuels, table lighting, outdoor lighting products, wickless candles and fragrance products with approximately 3800 SKUs serving the foodservice and retail markets. Sterno originally focused on chafing fuel (canned heat) products and later expanded its offerings to include table ambiance products such as liquid wax, wax candles and votive lamps, as well as outdoor lighting with the acquisition of Sterno Home in 2016, and wax cubes and warmer products through its acquisition of Rimports. Sterno’s products fall into six major categories: canned heat, catering equipment and butane products, table lighting, flameless candles and outdoor lighting, wickless candle and fragrance products.

Products, Customers and Distribution Channels

Products

Canned Heat - The canned heat product line is composed of various chafing fuels packaged in small, portable cans. The portable warming (canned heat) line is composed of wick-based and gel-based chafing fuels packaged in steel cans. These products are used by foodservice professionals in a variety of food serving and holding applications and are designed to keep food products at an optimal food-safe serving temperature of 140-165 Fahrenheit. The canned heat product line is composed of two subcategories: wick chafing fuel and gel chafing fuel. The subcategories are distinguished based on the type of chafing fuel being used. Each fuel contains unique characteristics and properties that allow the Company to offer a broad array of configurations to suit varying user requirements.

Catering Equipment - Catering equipment products are designed to provide a complete commercial catering solution whether indoor or outdoor. Products include chafing dish frames and lids, wind guards and buffet sets.

Butane - Sterno produces a full line of professional quality portable butane stoves, ideal for action stations, made-to-order omelet lines, tableside and off-site cooking, outdoor events and more. Products also include select butane accessories for special culinary applications such as the culinary torch. Sterno butane fuel comes with an additional safety feature called Countersink Release Vent (CRV) Technology.

Table Lighting - Sterno sells a variety of items designed to enhance lighting and ambiance at meal settings which are critical to a customer’s experience. Products include liquid wax, traditional hard wax and flameless electronic candles, as well as votive lamps, shaded lamps and accent lamps.

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Flameless Candles and Outdoor Lighting - Sterno offers a wide selection of lighting for homes, gardens, patios and yards with over 360 SKU's available in its retail markets. All of Sterno's products are powered by one of the following: i) Solar - solar panel with rechargeable power source - usually a rechargeable battery; ii) Battery - battery operated; iii) Plug-in - plugs directly into a regular wall socket either with 2 or 3 prong plug and with or without included and attached transformer; iv) Low Voltage - part of a set which includes a stand-alone transformer. Fixtures connect through a stand-alone wire via clip connectors; v) Line Voltage - hardwired into a home's electrical circuitry, or vi) Rechargeable - product is recharged when empty, usually through a plug-in wire and an onboard rechargeable power source.

•Flameless Candles - The flameless candle product line is made up of various types and sizes of candles with all of them sharing one main attribute: their glow is powered by an artificial power source, most often battery. This makes them inherently safer than traditional candles as there is no flame or even heat generated to cause any type of accident. Although pillar type candles are the most common shape, Sterno also designs and manufactures votives, tealights, tapers as well as specialty molded candles. Sterno candles stand out from the competition as they offer a patented black wick with a unique algorithm-based light circuit which gives the candle a naturally random flicker and glow.

•Landscape Lighting - Landscape lighting is lighting that promotes and accentuates elements of a consumer’s home, yard or garden so its beauty can be enjoyed both in daytime and nighttime. Another benefit of landscape lighting is added safety as it is easier to navigate around a home at night when it is reasonably well-lit. Landscape lighting was originally most commonly powered through a low voltage setup but as solar technologies have rapidly developed, many of these fixtures can achieve their lighting purposes with only a solar panel for power generation.

•Décor Lighting - Décor lighting has similar functions to landscape lighting but is usually less about safety and functionality and more about accenting an area of the outside home with ornamentation of some sort. With a décor piece, the light the piece gives off and the item itself together become elements of beauty in the setting. Because these items are very trend driven, consumers are more apt to switch them out more often therefore increasing repeat purchase potential and other recurrent sales opportunities for Sterno.

Wickless Candle and Fragrance Products

•Wax Warmers and Scented Wax Cubes - The wax and wax warmer line is composed of a large variety of fragrance and warmer design choices for consumers. The wax cubes are long-lasting and consistently release strong fragrance. The scented wax cubes are at a price point whereby they are an impulse item, making it easy and quick for the customer to change fragrances. The flameless feature is a plus in that it provides safety improvements over traditional flame candles. The proprietary formula and high quality fragrances add to the high quality of the domestically-made products. We believe ongoing research contributes to consumer loyalty, superior quality, and well-rounded fragrance programs. The wax warmers are made up of quality materials including wood, metal, ceramic, and glass.

•Essential Oils and Diffusers - The 100% Pure Essential Oil lines and brands consists of Peppermint, Lavender, Lemon, Eucalyptus, Sweet Orange, Grapefruit, Tea tree, Cinnamon, etc. Customers are attracted to high quality, 100% pure oil products with no additives or fillers. Attractively designed diffusers appeal to consumers in the Aromatherapy Home Fragrance section.

•ScentCharms - With various interchangeable high-quality fragrance oils and plug-in designs, consumers enjoy a personalized experience. The product is designed to be no spill, no mess, clutter-free, and long-lasting.

•Aromatherapy Products - The aromatherapy line consists of room sprays, liquid hand soaps, foaming hand soaps, hand sanitizers, body lotions, and body scrubs, etc. The five unique fragrance combinations - lavender and chamomile, eucalyptus and rosemary, orange and vanilla, lemon and grapefruit, and peppermint and geranium - are made with pure essential oils.

Customers and Distribution Channels

Sterno's products are sold primarily through the food service and consumer retail channels. Sterno’s product distribution network is comprised of long-standing, entrenched relationships with a diversified set of customers.

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Sterno’s top ten customers comprised approximately 73%, 70%, and 70% of gross sales in the years ended December 31, 2025, 2024 and 2023, respectively.

•Foodservice - The foodservice channel consists of multiple layers of distribution comprised of broadline distributors, equipment and supply dealers and cash and carry dealers. Within the food service channel, Sterno’s products are predominantly used in the restaurant, lodging/hospitality and catering markets.

•Retail - The retail channel consists of club stores, mass merchants, specialty retailers, grocers and national and regional DIY stores. The Company’s retail products are used in home, camping and emergency applications. The Company’s retail products appeal to a wide variety of consumers, from home entertainers to recreational campers and extreme outdoorsmen. Online retail sales are also an important channel for Sterno and Rimports. With an online dynamic, it is also much easier to showcase how Sterno’s and Rimports' products look in actual dark use conditions, directly addressing their primary merchandising challenge.

The following table sets forth Sterno’s gross revenue by product for the fiscal years ended December 31, 2025, 2024 and 2023:

(1) As a percentage of gross sales, exclusive of sale discounts.

Sterno had approximately $10.7 million and $12.5 million in firm backlog orders at December 31, 2025 and 2024, respectively.

Business Strategies and Competitive Strengths

Business Strategies

Defend Leading Position - As a leading supplier of canned fuels, flameless candles and outdoor lighting, wickless candles and fragrance products, Sterno places great value in delivering high quality customer service and product selection. In a market characterized by fragmented categories and competition, Sterno will continue to focus on providing excellent service to its customers. Sterno Products has been the recipient of numerous vendor awards for its high degree of customer service.

Pursue Selective Acquisitions - Sterno views acquisitions as a potentially attractive means to expand its product offerings in the foodservice and retail channels as well as enter new categories within the Home Fragrance space.

Expand Retail Distribution - Sterno’s management believes that there is an opportunity to leverage the iconic nature of the “Sterno” brand to expand its retail product offering and to expand distribution into additional retailers.

Create Innovative Products - Having innovative design, marketing, and production teams enables Rimports to expand into new fragrance systems and markets, as it has done with decorative Fragrance Oils Plug-Ins, Reed Diffusers, and more. Rimports will continue to focus on elevating everyday fragrance by providing high quality products and low prices to retailers and end-users.

Competitive Strengths

Leading Brand Recognition & Market Share - Sterno Products has a leading position in the canned chafing fuel market. Management believes Sterno Products enjoys outstanding brand awareness and a reputation for superior quality and performance with distributors, caterers, hotels and other end users. Rimports is in a leadership position in fragrance systems, particularly the wickless candle market, and is growing its market share in the essential oils

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and diffusers and plug-in liquid fragrance markets. Rimports offers a large variety of products to retailers in North America, Canada, and the United Kingdom.

Low Cost versus Alternatives - Sterno Product's customers are typically caterers, hotels or restaurants who utilize canned chafing fuel to maintain prepared food at a safe and enjoyable serving temperature. The risk of ruining a dining experience and the low proportionate cost of canned chafing fuel relative to the cost of a catered event represent barriers to customers switching out of Sterno’s canned chafing fuel products. Additionally, management believes that Sterno canned chafing fuel products’ technology offers a combination of portability, reliability and low cost. Rimports’ ultimate consumers seek high quality products in the Home Fragrance section. This high value proposition ensures consumer loyalty and satisfaction.

Suppliers and Manufacturing

Sterno's product manufacturing is based on a dual strategy of in-house manufacturing and strategic alliances with select vendors. Sterno operates an efficient, low-cost supply chain, sourcing materials and employing contract manufacturers from across the Unites States, as well as Mexico and the Asia-Pacific region.

Sterno Products’ primary raw materials are chemicals used in chafing fuel, such as diethylene glycol, ethanol, etc., paraffin, and metal cans, for which it receives multiple shipments per month.

Rimports sources raw materials from and outsources manufacturing processes to companies in the U.S. and China. Raw materials include wax, fragrances, and color dye for waxes; essential oils; wood, metal, ceramic, and glass for warmers and diffusers; and packaging supplies.

Intellectual Property

Sterno relies upon a combination of trademarks and patents in order to secure and protect its intellectual property rights. Sterno currently owns 239 registered trademarks and 72 patents globally and has 22 applications for trademarks and patents pending.

Regulatory Environment

Sterno is proactive regarding regulatory issues and management believes that it is in compliance with all relevant regulations. Sterno maintains adequate product liability insurance coverage. Management believes that Sterno complies, in all material respects, with applicable environmental and occupational health and safety laws and regulations.

Seasonality

Sterno Products typically has higher sales in the second and fourth quarter of each year, reflecting the outdoor summer season and the holiday season. Rimports typically has higher sales in the third and fourth quarter of each year, reflecting the holiday season.

Human Capital

At December 31, 2025, Sterno had 450 employees within its two product divisions. Sterno Products operates out of four locations in the United States, with a majority of their employees located at production facilities in Memphis, Tennessee and Texarkana, Texas. Rimports employees primarily operate out of Rimports' facilities in Provo, Utah. Sterno believes that its relationship with its employees is good.