Company: PRMB
Filing Date: 2025-05-08
Form Type: 424B3
Source: 0002042694-25-000009
Chunk: 13

Company: Primo Brands Corp
Filing Date: 2025-05-08
Form: 424B3
Chunk 13
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, and other trade promotional discounts (sales incentives). For certain sales incentives, the accrual recorded by the Company for the rebate or discount that will be granted to the customer, requires significant estimation. The critical assumptions used in estimating the sales incentive accruals include the Company’s estimate of expected levels of performance and redemption rates, which requires judgment. These assumptions are developed based upon the historical performance of the customer's participation with similar types of promotions adjusted for current trends. These estimated sales incentives are included in the transaction price of the Company’s contracts with customers as a reduction within net sales and are included as either a reduction in accounts receivable if the customer is entitled to take a deduction on their payment, or as accrued sales incentives in accruals and other current liabilities if the Company anticipates needing to pay the customer.

As of March 31, 2025 and December 31, 2024, estimated discounts reflected in Trade receivables, net of allowance for credit losses in the Condensed Consolidated Balance Sheets were $58.7 million and $61.8 million, respectively.

As of March 31, 2025 and December 31, 2024, accrued sales incentive obligations reflected in Accruals and other current liabilities in the Condensed Consolidated Balance Sheets were $23.2 million and $39.8 million, respectively.

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#### Fair Value Measurements
Fair value is defined as the price that would be received from the sale of an asset or paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date.

To measure fair value of assets and liabilities, the Company uses the following fair value hierarchy based on three levels of inputs:

• Level 1 — observable inputs, such as quoted prices in active markets for identical assets or liabilities;

• Level 2 — significant other observable inputs that are observable either directly or indirectly; and

• Level 3 — significant unobservable inputs for which there are little or no market data, which require the Company to develop its own assumptions.

Cash and cash equivalents, trade receivables, net and accounts payable are carried at cost, which approximates their fair value because of their short-term maturity. See Note 6 - "Debt" for disclosures of certain financial liabilities that are not measured at fair value.

Determining which category an asset or liability falls within this hierarchy requires judgment. The Company evaluates its hierarchy disclosures each period disclosures are presented.

#### Recently Adopted Accounting Pron