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Commitments and Contingencies
9 Months Ended
Sep. 30, 2022
Commitments and Contingencies Disclosure [Abstract]  
Commitments And Contingencies [Text Block]
Note 18 – Commitments and Contingencies
The Company previously disclosed in its 2021 Form 10-K that AC Products, Inc.
 
(“ACP”), a wholly owned subsidiary,
 
in 2007,
agreed to operate two groundwater treatment systems, so as to hydraulically
 
contain groundwater contamination emanating from
ACP’s site until such time as the concentrations
 
of contaminants are below the current Federal maximum contaminant
 
level for four
consecutive quarterly sampling events. In 2014, ACP ceased operation
 
at one of its two groundwater treatment systems, as it had met
the above condition for closure. As of September 30, 2022, ACP continues
 
to operate the second groundwater treatment system, while
the Company discusses with the relevant authorities whether the second
 
groundwater treatment system meets the conditions for
closure.
 
In addition, the Santa Ana Regional Water
 
Quality Control Board requested that ACP conduct additional indoor
 
and outdoor
soil vapor testing on and near the ACP site to confirm that ACP continues to meet the applicable
 
local soil vapor standards.
 
As of
September 30, 2022, ACP performed such testing and is awaiting the review
 
of the results from the Santa Ana Regional Water
 
Quality
Control Board.
As of September 30, 2022, the Company believes that the range of pot
 
ential-known liabilities associated with the balance of the
ACP water remediation program is approximately $
0.1
 
million to $
1.0
 
million.
 
The low and high ends of the range are based on the
length of operation of the treatment system as determined by groundwater
 
modeling.
 
Costs of operation include the operation and
maintenance of the extraction well, groundwater monitoring and
 
program management.
The Company previously disclosed in its 2021 Form 10-K that an inactive
 
subsidiary of the Company that was acquired in 1978
sold certain products containing asbestos, primarily on an installed basis, and
 
is among the defendants in numerous lawsuits alleging
injury due to exposure to asbestos.
 
During the three and nine months ended September 30, 2022, there have been
 
no significant
changes to the facts or circumstances of this previously disclosed matter,
 
aside from on-going claims and routine payments associated
with this litigation.
 
Based on a continued analysis of the existing and anticipated future claims against this subsidiary,
 
it is currently
projected that the subsidiary’s total
 
liability over the next 50 years for these claims is approximately $
0.3
 
million (excluding costs of
defense).
The Company previously disclosed in its 2021 Form 10-K that it is party to certain environmental
 
matters related to certain
domestic and foreign properties.
 
These environmental matters primarily require the Company
 
to perform long-term monitoring and
maintenance at each of the applicable sites.
 
During the three and nine months ended September 30, 2022, there have
 
been no
significant changes to the facts or circumstances of these previously disclosed
 
matters, aside from on-going monitoring and
maintenance activities and routine payments associated with each of
 
the sites.
 
The Company continually evaluates its obligations
related to such matters, and based on historical costs incurred and
 
projected costs to be incurred over the next approximately 30 years,
has estimated the range of costs for all of these environmental matters, on
 
a discounted basis, to be between approximately $
5.0
million and $
6.0
 
million as of September 30, 2022, for which $
5.2
 
million was accrued within other accrued liabilities and other non-
current liabilities on the Company’s
 
Condensed Consolidated Balance Sheet as of September 30, 2022.
 
Comparatively, as of
December 31, 2021, the Company had $
5.6
 
million accrued for with respect to these matters.
Although there can be no assurance regarding the outcome of other
 
unrelated environmental matters, the Company believes that it
has made adequate accruals for costs associated with other environmental matters
 
for which it is aware, and has accrued $
0.4
 
million
as of both September 30, 2022 and December 31, 2021, respectively,
 
to provide for such anticipated future environmental assessments
and remediation costs.
The Company previously disclosed in its 2021 Form 10-K that during the first nine
 
months of 2021, one of the Company’s
Brazilian subsidiaries received a notice that it had prevailed on an existing legal
 
claim in regard to certain non-income (indirect) taxes
that had been previously charged and paid.
 
The matter specifically related to companies’ rights to exclude the state tax on goods
circulation (a valued-added-tax or VAT
 
equivalent, known in Brazil as “ICMS”) from the calculation of certain additional indirect
taxes (specifically the program of social integration (“PIS”) and contribution
 
for the financing of social security (“COFINS”)) levied
by the Brazilian States on the sale of goods.
 
In May 2021, the Brazilian Supreme Court concluded that ICMS should
 
not be included
in the tax base of PIS and COFINS, and confirmed the methodology for calculating the
 
PIS and COFINS tax credit claims to which
taxpayers are entitled.
 
The Company’s Brazilian entities had previously
 
filed legal or administrative disputes on this matter and are
entitled to receive tax credits and interest dating back five years preceding the
 
date of their legal claims.
 
As a result of these court
rulings in the first nine months of 2021, the Company recognized non-income
 
tax credits of
67.0
 
million BRL or approximately $
13.3
million, which includes approximately $
8.4
 
million for the PIS and COFINS tax credits as well as interest on these tax credits of $
4.9
million.
 
The tax credits to which the Company’s
 
Brazilian subsidiaries are entitled are claimable once registered with the Brazilian
tax authorities which the Company subsequently completed.
 
These tax credits can be used to offset future Brazilian federal taxes
 
and
the Company currently anticipates using the full amount of credits during the
 
five year period of time permitted.
In connection with obtaining regulatory approvals for the Combination,
 
certain steel and aluminum related product lines of
Houghton were divested in August 2019. The Company previously disclosed
 
in its 2021 Form 10-K that in July 2021, the entity that
acquired these divested product lines submitted an indemnification claim
 
for certain alleged breaches of representation made by
Houghton in the agreement pursuant to which such assets had been divested.
 
The Company responded to the subject matters of the
indemnification claim and during the first quarter of 2022, the
 
matter was resolved consistent with the Company’s
 
expectations and
position that there were
no
 
amounts owed by the Company.
 
The Company previously disclosed in its 2021 Form 10-K that two of the Company’s
 
locations suffered property damages as a
result of flooding and electrical fire, respectively.
 
The Company maintains property and flood insurance for all of its facilities
globally.
 
During the nine months ended September 30, 2022, there have been no significant changes
 
to the facts or circumstances of
these previously disclosed matters, aside from the on-going restoration
 
of both sites.
 
The Company, its insurance
 
adjuster and
insurance carrier are actively managing the remediation and restoration
 
activities associated with these events and at this time the
Company has concluded, based on all available information and discussions
 
with its insurance adjuster and insurance carrier,
 
that the
losses were covered under the Company’s
 
property and flood insurance coverage, net of an aggregate deductible of $
2.0
 
million.
 
Through September 30, 2022, the Company has received payments from
 
its insurers of $
3.9
 
million associated with these events.
 
During the three months ended September 30, 2022, the Company recognized
 
a gain on insurance recoveries of $
1.1
 
million.
 
The
Company has recorded an insurance receivable of $
0.2
 
million as of September 30, 2022.
 
See Note 10 of Notes to the Condensed
Consolidated Financial Statements.
 
The Company is party to other litigation which management currently
 
believes will not have a material adverse effect on the
Company’s results of operations,
 
cash flows or financial condition.
 
In addition, the Company has an immaterial amount of contractual
purchase obligations.