Company: PRMB
Filing Date: 2025-02-07
Form Type: S-1/A
Source: 0001193125-25-022806
Chunk: 126

Company: Primo Brands Corp
Filing Date: 2025-02-07
Form: S-1/A
Chunk 126
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 that it is more likely than not that an impairment exists, then a quantitative assessment is performed. In the quantitative assessment for goodwill and indefinite-lived intangible assets, an assessment is performed to determine
the fair value of the reporting unit and indefinite-lived intangible asset, respectively.

BlueTriton uses either the income approach or
in some cases a combination of income and market-based approaches, to determine the fair value of its assets, as well as an overall consideration of market capitalization and enterprise value. If the carrying value of the reporting unit or
intangible asset exceeds the estimated fair

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value, an impairment charge is recognized in an amount equal to that excess. Goodwill is tested for impairment at the reporting unit level annually, in the fourth quarter, or when events or
changes in circumstances indicate that goodwill might be impaired. BlueTriton performed a quantitative assessment during 2023 using a combination of an income and market-based approach and determined that the fair values of its reporting units were
not less than recorded carrying values, and therefore no impairment exists.

BlueTriton uses an income approach, the relief from royalty
method, to determine the fair value of its indefinite lived intangible assets. BlueTriton used specific royalty rates for each trade name based on consideration of comparable third-party licensing transactions and the profit margins earned. Based on
BlueTriton’s analysis, the company determined that the fair value of each of its trade names was adequately in excess of their carrying amount, and therefore no impairment exists.

There are inherent uncertainties related to each of the qualitative assumptions, and BlueTriton’s judgment in applying them. Changes in
the assumptions used in BlueTriton’s qualitative assessment of goodwill and intangible assets could result in impairment charges that could be material to the consolidated financial statements in any given period.

Self-Insurance Reserves

BlueTriton is self-insured for workers’ compensation, property, automobile, and general liability. The self-insurance claim liability is
determined actuarially, at a minimum annually, based on claims filed and an estimate of claims incurred but not yet reported. Actuarial projections of the losses are employed due to variability in the liability estimates. The estimates used are
derived from any inputs including the severity of claims, frequency, and volume of claims, the development timeframe, settlement history and patterns, and cost trends. BlueTriton has purchased stop-loss coverage from various insurers in order to
limit its claims exposure. The insurance-related liabilities are not