EDGAR 10-K Filing

Company CIK: 1320461
Filing Year: 2025
Filename: 1320461_10-K_2025_0001320461-25-000033.json

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ITEM 1. BUSINESS
Item 1. Business
Cooper-Standard Holdings Inc. (together with its consolidated subsidiaries, the “Company,” “Cooper Standard,” “we,” “our” or “us”) is a leading manufacturer of sealing and fluid handling systems (consisting of fuel and brake delivery systems and fluid transfer systems). Our products are primarily designed for passenger vehicles and light trucks that are manufactured by global automotive original equipment manufacturers (“OEMs”) and replacement markets. Nearly all of our activities are conducted through our subsidiaries.
Cooper Standard is listed on the New York Stock Exchange (“NYSE”) under the ticker symbol “CPS.” The Company has approximately 22,000 employees, including 2,500 contingent workers, across 124 facilities in 20 countries. We believe we are the largest global producer of sealing systems, the second largest global producer of the types of fuel and brake delivery products we manufacture, and the third largest global producer of the types of fluid transfer systems we manufacture. We design and manufacture our products in each major region of the world through a disciplined and sustained approach to engineering and operational excellence. We operate in 75 manufacturing locations and 49 design, engineering, administrative and logistics locations.
Approximately 86% of our sales in 2024 were to OEMs. Our largest customers are Ford Motor Company (“Ford”), General Motors Company (“GM”), Stellantis, Volkswagen Group, Mercedes-Benz, and Renault-Nissan. Our other customers include BMW, Jaguar/Land Rover, Hyundai, Toyota, and Rivian. Our OEMs in China include BYD, Geely, and Chery. The remaining 14% of our 2024 sales were primarily to Tier I and Tier II automotive suppliers, non-automotive customers, and replacement market distributors. The Company’s products are featured on more than 430 nameplates globally.
Prior to January 1, 2024, our organizational structure primarily consisted of a global automotive business (“Automotive”) and the Industrial and Specialty Group (“ISG”). Effective January 1, 2024, the Company changed its management reporting structure with the launch of global product line-focused business segments. This resulted in the realignment of its reportable segments, which are determined based on how the chief operating decision maker (“CODM”) manages the business, allocates resources, makes operating decisions and evaluates operating performance. As a result, the Company established two reportable segments: Sealing Systems and Fluid Handling Systems. All other business activities are reported in Corporate, eliminations and other. The segment realignment had no impact on the Company’s consolidated financial position, results of operations, or cash flows. All segment information included in this Annual Report on Form 10-K is reflective of this new structure and prior period information has been revised to conform to the Company’s current period presentation. On an ongoing basis, we undertake restructuring, expansion and cost reduction initiatives to improve competitiveness.
Corporate History and Business Developments
Cooper-Standard Holdings Inc. was established in 2004 as a Delaware corporation and began operating on December 23, 2004 when it acquired the automotive segment of Cooper Tire & Rubber Company. Cooper-Standard Holdings Inc. operates the business primarily through its principal operating subsidiary, Cooper-Standard Automotive Inc. (“CSA U.S.”). Since the 2004 acquisition, the Company has expanded and diversified its customer base through a combination of organic growth and strategic acquisitions.
Our ISG business is a dedicated team that leverages Cooper Standard’s decades of engineering and manufacturing expertise to deliver OEM-quality solutions across diverse transportation and industrial markets. We furthered the expansion of our ISG business through the acquisition of Lauren Manufacturing and Lauren Plastics in 2018.
Cooper Standard signed multiple joint development agreements for its Fortrex™ chemistry platform throughout 2018 to 2021. In 2021, the Company reached a long-term commercial agreement to license its Fortrex™ technology to NIKE, Inc., with the footwear manufacturer launching the first related mass production programs in 2023. Since its initial launch, NIKE has expanded the adoption of this technology across multiple footwear products.
In 2023, we finalized the divestiture of our European technical rubber products business and sold the Company’s entire controlling equity interest in a joint venture in the Asia Pacific region.
Business Strategy
Cooper Standard’s Purpose statement - Creating Sustainable Solutions Together - reflects the Company’s focus on creating solutions that ensure the long-term health of the business and the sustained value that we work each day to deliver to our stakeholders (customers, investors, employees, suppliers and communities). Our key strategic imperatives are defined as:
Financial Strength: Execute our business plans achieving and sustaining double-digit EBITDA margins, ROIC and strong free cash flow generation.
World-Class Execution: Attain world-class results across all our business allowing the Company to Be the First Choice of the Stakeholders We Serve.
Profitable Growth Driven by Innovation: Leverage our materials science and product knowledge, innovation and manufacturing expertise across our product groups in the pursuit of organic and inorganic growth.
Corporate Responsibility: Deliver value to all our stakeholders through our environmental, social and governance initiatives to ensure the long-term sustainability of the Company.
Cooper Standard’s global alignment around these imperatives continues to drive further value in many areas of the business.
Operational and Strategic Initiatives
As part of Cooper Standard’s world-class operations, the Company leverages its CSOS (Cooper Standard Operating System) to drive growth and maintain global consistency across engineering design, program management, manufacturing process, purchasing and IT systems. Standardization across all regions is particularly crucial to supporting customers’ global platforms that require the same design, quality and delivery standards worldwide. Through these initiatives, the Company has successfully utilized CSOS to achieve an average annual savings of approximately $50 million each of the past five years by enhancing operational efficiency.
In addition, as part of our continued focus on sustainability and corporate responsibility, the Company’s Global Sustainability Council provides executive-level oversight for our sustainability strategy to help ensure alignment and integration with business goals and stakeholder priorities. The council maintains a holistic look at the Company’s environmental, social and governance initiatives, tracking rapidly-evolving best practices and regulations to further support our long-term strategic goals.
Cooper Standard continues to advance its diversification strategy through its ISG business, which is charged with accelerating and maximizing expertise in the Company’s core product types for applications in the industrial and specialty markets. The Company also drives growth and diversification through its applied materials science offerings, which include the Fortrex™ chemistry platform that provides performance advantages over many other materials while also significantly reducing carbon footprint.
Leveraging Technology and Materials Science for Innovative Solutions
We use our technical and materials science expertise to provide customers with innovative and sustainable product solutions. Our engineers use the results of advanced computational simulations and incorporate a broad understanding of materials science to design products which meet or exceed our customers’ stringent requirements. We believe our reputation for successful innovation in product design and materials is the reason our customers consult us early in the development and design process of their next-generation vehicles or products.
Cooper Standard uses its i3 Innovation Process (Imagine, Initiate and Innovate) as a key mechanism to capture novel ideas while promoting a culture of innovation. Our global product line teams and Global Technology Council carefully evaluate these ideas, selecting the most promising ones for accelerated development. We are continuously cultivating innovative technologies based on materials expertise, process know-how, and application vision, which may drive future product direction. An example is Fortrex™, the Company’s synthetic elastomer chemistry platform, offering reduced weight while delivering superior material performance and aesthetics. We have also developed several other significant technologies, especially related to advanced materials, processing and weight reduction. These include: FlexiCore™, a thermoplastic body seal that replaces traditional metal carriers in vehicle on-body seals with a more eco-friendly, lightweight plastic; FlushSeal™, an advanced integrated solution for frame-under-glass static sealing systems offering better appearance, improved aerodynamics, quieter ride and reduced weight; TPE body seal, a next generation body seal that replaces traditionally less sustainable EPDM and metal with recyclable thermoplastic materials which save significant component weight; eCoFlow™ switch pump, a solution that offers features of both an electric water pump and electronically driven valve in a single integrated coolant control module; plastic
coolant hub, a solution that combines many fluid handling components and a uniquely integrated pressure balancing feature into a sophisticated centralized compact plastic manifold; MagAlloy™, a processing technology for brake lines that increases long term durability through superior corrosion resistance; and Easy-Lock™, a small package coolant and fuel vapor quick connect. Given the trajectory and anticipated future growth of electric vehicles, Cooper Standard has developed innovations to provide lightweight plastic tubing with our PlastiCool® 2000 multilayer tubing, smooth and convoluted mid-temperature multilayer tubing, and our next-generation Ergo-Lock™ and Ergo-Lock™ + VDA quick connectors for glycol thermal management needs.
Cooper Standard is strategically integrating digital tools and advanced analysis to help deliver the best solutions. We offer advanced computer-aided engineering and digital simulations for engineered solutions. In addition, our team of experts has developed digital tools that enable them to conduct prototype testing without the need for physical samples, resulting in sustainability benefits. For certain products, we can provide up to 100% virtual testing.
We continue to adopt proprietary artificial intelligence (“A.I.”) based solutions where they deliver business value. These solutions include Formulink, which enables guided development of superior polymer compounds in less time; and A.I. based tools for virtual validation of product performance, which reduces requirements for physical testing.
Our solutions also include A.I. tools for automated process control, enabling the full automation of polymer extrusion and other complex continuous processes. This advanced technology reduces process variation (a top driver of scrap), increases product quality, improves operational metrics, and reduces our carbon footprint. To promote adoption of these solutions within Cooper Standard and explore potential external sales opportunities, the Company established Liveline Technologies as a wholly-owned subsidiary of Cooper Standard.
The Company continues to assess the latest advancements in A.I. and looks for opportunities to drive improved business results through its continued adoption.
Our innovations are receiving industry recognition. Cooper Standard earned an Environment + Energy Leader Award in 2022 for our Fortrex™ chemistry platform, in addition to being named a General Motors Overdrive Award winner in the category of ‘Sustainability’ in 2021, a 2018 Automotive News PACE Award winner, and a 2018, 2019, and 2023 Society of Plastics Engineers Innovation Award finalist. Cooper Standard’s A.I.-enhanced development cycle for polymer compound development was named a finalist for the 2019 Automotive News PACE Awards. Also, our FlexiCore™ Thermoplastic Body Seal received the SAA Innovations in Lightweighting Award in 2024 and was named an Automotive News PACE Pilot Finalist.
Cooper Standard’s fluid handling products were also selected as the Society of Plastics Engineers 2022 Automotive Innovation Award winner for the Material category for our innovative battery electric vehicle thermoplastic thermal management solution utilizing PlastiCool® 2000 multilayer tube and Ergo-Lock® connectors. In addition, our Plastic Coolant Hub Technology was selected as a 2024 Automotive Innovation Award winner for the Powertrain category and our eCoFlow Switch Pump™ was named as an Automotive News PACE Pilot award finalist.
Industry
The automotive industry is one of the world’s largest and most competitive markets. Consumer demand for new vehicles largely determines sales and production volumes of global OEMs. The business and commercial environment in each region also plays a role in vehicle demand as it relates to fleet vehicle sales and industrial-use vehicles such as light and heavy trucks.
OEMs compete for market share in a variety of ways including pricing and incentives, the development of new, more attractive models, branding and advertising, and the ability to customize vehicle features and options to meet specific consumer needs or demands. They rely heavily on thousands of specialized suppliers to provide the many distinct components and systems that comprise the modern vehicle. They also rely on these automotive suppliers to develop technological innovations that will help them meet internal and consumer demands as well as regulatory requirements.
The supplier industry is a highly competitive industry and is generally characterized by high barriers to entry, significant start-up costs and long-standing customer relationships. The criteria by which OEMs judge automotive suppliers include quality, price, service, launch performance, design and engineering capabilities, innovation, timely delivery, financial stability, global footprint and sustainability. Over the last decade, the most successful suppliers have been able to achieve manufacturing scale globally, reduce structural costs, diversify their customer base and provide innovative, value-added technologies.
The technology of today’s vehicles is evolving rapidly. This evolution is being driven by many factors including consumer preferences and social behaviors, a competitive drive for differentiation, regulatory requirements and environmental impact and safety. Cooper Standard supports these trends by providing innovations that reduce weight, increase life-cycle and durability, reduce interior noise, enhance exterior appearance, simplify the manufacturing and assembly process, and help reduce a vehicle’s environmental impact. These are innovations that can be applicable and valuable to virtually any vehicle (including
internal combustion, hybrid or battery electric powertrains) or vehicle manufacturer and, in many cases, can also be transferred to non-automotive applications in adjacent markets. Cooper Standard remains closely aligned with our customers and is prepared to meet their evolving needs as they shift their fleets and offer more electric vehicle (“EV”) and hybrid options. We are focused on growing our business in the EV segment by leveraging our technology and innovation to provide value-add solutions for increasingly specialized technical requirements.
Markets Served
Our automotive business is focused on the passenger car and light truck market, up to and including Class 3 full-size, full-frame trucks, better known as the global light vehicle market. This is our largest market and accounts for approximately 95% of our global sales.
Customers
We are a leading supplier to the following OEMs and are increasing our presence with major OEMs throughout the world. The following charts show the percentage of sales to our top customers for the years ended December 31, 2024, 2023 and 2022:
Our other customers include OEMs such as BMW, Jaguar/Land Rover, Hyundai, Toyota, and Rivian. Our OEMs in China include BYD, Geely, and Chery. Our business with any given customer is typically split among several contracts for different parts on a number of platforms.
Products
Our product lines include sealing systems and fluid handling systems (consisting of fuel and brake delivery systems and fluid transfer systems). These products are produced and supplied globally to a broad range of customers in multiple markets.
In addition to these product lines, we also sell our core products into other adjacent markets. The percentage of sales by product line and other markets for the years ended December 31, 2024, 2023 and 2022 are as follows:
Product Lines Market Position
SEALING SYSTEMS Protect vehicle interiors from weather, dust and noise intrusion for improved driving experience; provide aesthetic and functional class-A exterior surface treatment Global leader
Products:
- Fortrex® materials platform
- FlexiCore™ Thermoplastic Body Seal
- Dynamic seals - FlushSeal™ sealing systems
- Static seals - Variable extrusion
- Encapsulated glass - Specialty sealing products
- Tex-A-Fib (Textured Surface with Cloth Appearance) - Stainless steel trim
- Obstacle detection sensor system - Frameless Systems
FLUID HANDLING SYSTEMS Fuel & Brake Delivery Systems - Sense, deliver and control fluid and fluid vapors for fuel and brake systems Top 2 globally
Products:
- Chassis & tank fuel lines & bundles (fuel lines, vapor lines & bundles) - Direct injection & port fuel rails (fuel rails & fuel charging assemblies)
- Metallic brake lines and bundles - MagAlloy™ break tube coating
- Quick connects - ArmorTube™ brake tube coating
- Low oligomer multi-layer convoluted tube - Series 300 and S300LT (low temperature) quick connects
- Brake jounce lines - Gen III Posi-Lock® quick connects
Fluid Transfer Systems - Sense, deliver, connect and control fluid delivery for optimal thermal management, powertrain & HVAC operation Top 3 globally
Products:
- eCoFlow™ switch pump - Turbo charger hoses
- Heater/coolant hoses - Charged air cooler ducts/assemblies
- Quick connects (SAE and VDA) - Secondary air hoses
- Diesel particulate filter (DPF) lines - Brake and clutch hoses
- Degas tanks and deaerators - Easy-Lock™ quick connect
- Charged air cooling (air intake and discharge) - Ergo-Lock™ VDA quick connect
- Transmission oil cooling hoses - Ergo-Lock™ + VDA quick connect
- Multilayer tubing for glycol thermal management - PlastiCool® 2000 multi-layer tubing for glycol thermal management
- PlastiCool® 5000 high temperature MLT
- Plastic coolant hub
Competition
We believe that the principal competitive factors in our industry are quality, price, service, launch performance, design and engineering capabilities, innovation, timely delivery, financial stability, global footprint and sustainability. We believe that our capabilities in these core competencies are integral to our position as a market leader in each of our product lines. Our sealing systems products compete with Toyoda Gosei, Henniges, Hutchinson, Standard Profil, HSR&A, SaarGummi and JianXin, among others. Our fuel and brake delivery systems products compete with TI Automotive, Sanoh, Martinrea, Maruyasu and SeAH, among others. Our fluid transfer systems products compete with Conti-Tech, Hutchinson, Teklas, Tristone, Akwel and Fränkische, among others.
Joint Ventures and Strategic Alliances
Joint ventures represent an important part of our business, both operationally and strategically. We have utilized joint ventures to enter and expand in geographic markets such as China, India and Thailand, to acquire new customers and to develop new technologies. When entering new geographic markets, teaming with a local partner can reduce capital investment by leveraging pre-existing infrastructure. In addition, local partners in these markets can provide knowledge and insight into local practices and access to local suppliers of raw materials and components.
The following table shows our significant unconsolidated joint ventures as of December 31, 2024:
Country Name Products Ownership Percentage
Thailand Nishikawa Tachaplalert Cooper Ltd. Sealing systems 20%
India Polyrub Cooper Standard FTS Private Limited Fluid transfer systems 35%
United States Nishikawa Cooper LLC Sealing systems 40%
China Yantai Leading Solutions Auto Parts Co., Ltd. Fuel and brake delivery systems 50%
China Shenya Sealing (Guangzhou) Company Limited Sealing and fluid transfer systems 51%
Research and Development
We have a dedicated team of technical and engineering resources for each product line, some of which are located at our customers’ facilities. We utilize simulation, digital tools, best practices, standardization and track key process indicators to drive efficiency in execution with an emphasis on manufacturability and quality. Our development teams work closely with our customers to design and deliver innovative solutions, unique for their applications. Amounts spent on engineering, research and development, and program management were as follows:
Year Amount Percentage of Sales
(Dollar amounts in millions)
2024 $82.8 3.0%
2023 $84.1 3.0%
2022 $80.5 3.2%
Intellectual Property
We believe that one of our key competitive advantages is our ability to translate customer needs and our ideas into innovation through the development of intellectual property. We hold a significant number of patents and trademarks worldwide.
Our patents are grouped into two major categories: (1) specific product invention claims and (2) specific manufacturing processes that are used for producing products. The vast majority of our patents fall within the product invention category. We consider these patents to be of value and seek to protect our rights throughout the world against infringement. While in the aggregate these patents are important to our business, we do not believe that the loss or expiration of any one patent would materially affect our Company. We continue to seek patent protection for our new products and we develop significant technologies that we treat as trade secrets and choose not to disclose to the public through the patent process. These technologies nonetheless provide significant competitive advantages and contribute to our global leadership position in various markets. We believe that our trademarks, including FlexiCore™, eCoFlow™, FlushSeal™, Gen III Posi-Lock®, Easy-Lock®, MagAlloy®, Ergo-Lock® +, PlastiCool® and Fortrex™, help differentiate us and lead customers to seek our partnership.
We also have technology sharing and licensing agreements with various third parties, including Nishikawa Rubber Company, one of our joint venture partners in sealing products. We have mutual agreements with Nishikawa Rubber Company for sales, marketing and engineering services on certain sealing products. Under those agreements, each party pays for services provided by the other and royalties on certain products for which the other party provides design or development services. We also have licensing and joint development agreements for commercial applications of our Fortrex™ chemistry platform in non-automotive industries. A joint development agreement with Salari Group has been put in place for the collaborative creation of novel dynamic fluid control products and systems.
Innovation, Materials, and Product Lifecycle
The international response to risks and opportunities of climate change is transforming our global economy. Our most significant opportunity to contribute to this low-carbon and circular economy is through reducing the environmental impact of our products and manufacturing processes. We purposefully apply sustainable principles in the design and production of our
products, reducing the environmental impact from sourcing through end-of-life. These efforts also enable our customers to reduce their environmental impacts.
When obtaining or innovating materials for our products, we seek to sustainably source raw materials, increase the use of recycled content or recyclable material where feasible, decrease our use of hazardous chemicals where possible, and properly disclose restricted materials to customers and regulators. We believe our culture of innovation is a key differentiator, allowing us to compete and succeed within our dynamic global markets.
Supplies and Raw Materials
Cooper Standard is committed to building strong relationships with our supply partners. We recognize the importance of engaging with suppliers to create value for our customers.
The principal raw materials for our business include synthetic rubber, carbon black, process oils, and plastic resins. Principal procured components are primarily made from plastic, carbon steel, aluminum and stainless steel. We manage the procurement of our direct and indirect materials to assure supply continuity and to obtain the most favorable total cost. Procurement arrangements include short-term and long-term supply agreements that may contain formula-based pricing tied to commodity indices. These arrangements provide quantities needed to satisfy normal manufacturing demands. We believe we have adequate sources for the supply of raw materials and components for our products with suppliers located around the world.
Our business is susceptible to inflationary pressures with respect to raw materials. Abrupt changes in the market prices or availability of certain key raw materials may result in operational and profitability challenges for the Company and the industry as a whole. Since 2020, market prices for key raw materials, such as steel, aluminum, and oil-derived commodities, experienced a period of extreme volatility, which led to significant cost increases for our business. In response, we worked with our customers to implement or expand index-based commercial agreements that have enabled us to partially recover incremental material costs incurred and significantly reduce our exposure and risk related to commodity price fluctuations going forward.
Seasonality
Within the automotive industry, sales to OEMs are typically lowest during the months prior to model changeovers or during assembly plant shutdowns. Automotive production is traditionally reduced during July, August and year-end holidays, and our quarterly results may reflect these trends. However, economic conditions and consumer demand may change the traditional seasonality of the industry. In recent years, for example, global light vehicle production, inventory and consumer demand all experienced extreme dislocations from historic norms due to the global COVID-19 pandemic and related restrictions on production and consumer activity. Post-pandemic, global light vehicle production continued to be negatively impacted by widespread supply chain disruptions, limiting the global automotive OEM’s ability to rebuild inventory and meet pent-up consumer demand. By 2023, these disruptions had been largely resolved and production and inventory returned to a more normal balance. While total production volume since 2023 has remained below pre-pandemic levels, seasonality of production has normalized.
Backlog
Our OEM sales are generally based upon purchase orders issued by the OEMs, with updated releases for volume adjustments. As such, we typically do not have a firm and definitive backlog of orders at any point in time. Once selected to supply products for a particular platform, we typically supply those products for the platform life, which is normally five to eight years, though this term is not guaranteed. In addition, when we are the incumbent supplier for a given platform, we believe we have a competitive advantage in winning the redesign or replacement platform, although, future awards are not guaranteed.
Human Capital and Safety
As of December 31, 2024, we had approximately 22,000 employees, including 2,500 contingent workers. We believe that we maintain good relations with both our union and non-union employees and, in the past ten years, have not experienced any major work stoppages.
Our people have always been the driving force of value at Cooper Standard. We continue to embrace new ways of working, a growing international movement for civil rights, and our unwavering dedication to keeping our employees healthy and safe has only made them more critical to our success. We accomplish this by developing the capabilities of our employees through continuous learning and performance management processes. Additionally, building an internal talent pipeline supports the achievement of this priority. In 2024, our internal fill rate was approximately 85%. This metric, which is based on salaried, director-level positions and above, helps us to understand where employees are advancing in their careers and the effectiveness of our internal development programs. For 2024, our voluntary employee turnover rate was approximately 13%. We believe that our culture and continued effort to provide our employees with growth opportunities contributes to retaining our strong talent.
In addition, we aim to diversify our workforce because we recognize the value of engaging different opinions and backgrounds in a global company. We are committed to recruiting, developing and retaining a high-performing and diverse workforce. A global measurement for our diversity is women in the company and women in leadership. In 2024, women made up approximately 40% of our workforce. Of our leadership positions, defined as vice president positions and above, women held approximately 21% of such roles.
Safety remains a top priority and primary focus of management. An emphasis on reducing workplace incidents helps Cooper Standard to maintain a safe workforce and continue to deliver world class results for product quality. In 2024, our total incident rate (“TIR”) was 0.30, which represents an Occupational Safety and Health Administration measurement of recordable injuries x 200,000 / total hours worked. Based on our review of industry peer sustainability reports, we have a lower TIR relative to our peer group and better than our world-class benchmark.
Community Involvement
Supported by the Cooper Standard Foundation, our employees are highly engaged in their local communities. The Foundation’s mission is to strengthen the communities where Cooper Standard employees work and live through the passionate support of children’s charities, education, health and wellness, and community revitalization. The Cooper Standard Foundation is a 501(c)(3) organization with oversight by its Board of Directors, Board of Trustees and Philanthropic Committee. For more information on the Company’s community involvement, please visit our Corporate Responsibility Report located on the Cooper Standard website.
Sustainability
In 2024, the Company was named to Newsweek’s list of America’s Most Responsible Companies for the sixth consecutive year and achieved Ecovadis Silver Status for sustainability efforts that also earned the Company recognition from Nissan for sustainability and social responsible practices. In addition, the Company was named to the USA TODAY America’s Best Climate Leaders 2024 list. These awards are a further testament to Cooper Standard’s commitment to driving value for all of our stakeholders including the communities we live and operate in.
Cooper Standard considers itself a steward of the environment, and we monitor the environmental impact of our business and products. We prioritize our environmental management as a means of driving and sustaining excellence. We are subject to a broad range of federal, state, and local environmental and occupational safety and health laws and regulations in the United States and other countries, including regulations governing: emissions to air, discharges to water, noise and odor emissions; the generation, handling, storage, transportation, treatment, reclamation and disposal of chemicals and waste materials; the cleanup of contaminated properties; and human health and safety. We have made, and will continue to make, expenditures to comply with environmental requirements. While our costs to defend and settle known claims arising under environmental laws have not been material in the past and are not currently estimated to have a material adverse effect on our financial condition, such costs could be material to our financial statements in the future. Further details regarding our commitments and contingencies are provided in Note 20. “Contingent Liabilities” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Annual Report on Form 10-K (the “Report”).
Market Data
Certain market data and other statistical information used throughout this Annual Report on Form 10-K is based on data from independent firms such as S&P Global. Other data is based on good faith estimates, which are derived from our review of internal analyses, as well as third-party sources. Although we believe these third-party sources are reliable, we have not independently verified the information and cannot guarantee its accuracy and completeness. To the extent that we have been unable to obtain information from third-party sources, we have expressed our belief on the basis of our own internal analyses of our products and capabilities in comparison to our competitors.
Available Information
We make available free of charge on our website (www.cooperstandard.com) our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, (the “Exchange Act”), as soon as reasonably practicable after we electronically file such material with, or furnish it to, the U.S. Securities and Exchange Commission (“SEC”). Our reports filed with the SEC also may be found on the SEC’s website at www.sec.gov. We may also use our website as a distribution channel of material company information. Neither the information on our website nor the information on the SEC’s website is incorporated by reference into this Report unless expressly noted.
Forward-Looking Statements
This Annual Report on Form 10-K includes “forward-looking statements” within the meaning of U.S. federal securities laws, and we intend that such forward-looking statements be subject to the safe harbor created thereby. Our use of words “estimate,” “expect,” “anticipate,” “project,” “plan,” “intend,” “believe,” “outlook,” “guidance,” “forecast,” or future or conditional verbs, such as “will,” “should,” “could,” “would,” or “may,” and variations of such words or similar expressions are intended to identify forward-looking statements. All forward-looking statements are based upon our current expectations and various assumptions. Our expectations, beliefs, and projections are expressed in good faith and we believe there is a reasonable basis for them. However, we cannot assure you that these expectations, beliefs and projections will be achieved. Forward-looking statements are not guarantees of future performance and are subject to significant risks and uncertainties that may cause actual results or achievements to be materially different from the future results or achievements expressed or implied by the forward-looking statements. Among other items, such factors may include: volatility or decline of the Company’s stock price, or absence of stock price appreciation; impacts and disruptions related to the wars in Ukraine and the Middle East; our ability to achieve commercial recoveries and to offset the adverse impact of higher commodity and other costs through pricing and other negotiations with our customers; work stoppages or other labor disruptions with our employees or our customers’ employees; prolonged or material contractions in automotive sales and production volumes; our inability to realize sales represented by awarded business; escalating pricing pressures; loss of large customers or significant platforms; our ability to successfully compete in the automotive parts industry; availability and increasing volatility in costs of manufactured components and raw materials; disruption in our supply base; competitive threats and commercial risks associated with our diversification strategy; possible variability of our working capital requirements; risks associated with our international operations, including changes in laws, regulations, and policies governing the terms of foreign trade such as increased trade restrictions and tariffs; foreign currency exchange rate fluctuations; our ability to control the operations of our joint ventures for our sole benefit; our substantial amount of indebtedness and rates of interest; our ability to obtain adequate financing sources in the future; operating and financial restrictions imposed on us under our debt instruments; the underfunding of our pension plans; significant changes in discount rates and the actual return on pension assets; effectiveness of continuous improvement programs and other cost savings plans; significant costs related to manufacturing facility closings or consolidation; our ability to execute new program launches; our ability to meet customers’ needs for new and improved products; the possibility that our acquisitions and divestitures may not be successful; product liability, warranty and recall claims brought against us; laws and regulations, including environmental, health and safety laws and regulations; legal and regulatory proceedings, claims or investigations against us; the potential impact of any future public health events on our financial condition and results of operations; the ability of our intellectual property to withstand legal challenges; cyber-attacks, data privacy concerns, other disruptions in, or the inability to implement upgrades to, our information technology systems; the possible volatility of our annual effective tax rate; the possibility of a failure to maintain effective controls and procedures; the possibility of future impairment charges to our goodwill and long-lived assets; our ability to identify, attract, develop and retain a skilled, engaged and diverse workforce; our ability to procure insurance at reasonable rates; and our dependence on our subsidiaries for cash to satisfy our obligations.
You should not place undue reliance on these forward-looking statements. Our forward-looking statements speak only as of the date of this Annual Report on Form 10-K and we undertake no obligation to publicly update or otherwise revise any forward-looking statement, whether as a result of new information, future events or otherwise, except where we are expressly required to do so by law.
This Annual Report on Form 10-K also contains estimates and other information that is based on industry publications, surveys and forecasts. This information involves a number of assumptions and limitations, and we have not independently verified the accuracy or completeness of the information.

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ITEM 1A. RISK FACTORS
Item 1A. Risk Factors
We have listed below (not necessarily in order of importance or probability of occurrence) the most significant risk factors that could cause our actual results to vary materially from recent or anticipated results and could materially and adversely affect our business, results of operations, financial condition and cash flows.
Operational Risks
Our business, financial condition and results of operations may be adversely impacted by the effects of inflation.
Inflation has the potential to adversely affect our business, financial condition and results of operations by increasing our overall cost structure. Other inflationary pressures could affect wages, the cost and availability of components and raw materials and other inputs and our ability to meet customer demand. Inflation may further exacerbate other risk factors, including supply chain disruptions, risks related to international operations and the recruitment and retention of qualified employees. If we are
unsuccessful in negotiating pricing adjustments with our customers to raise the prices of our products sufficiently to keep up with the rate of inflation, our profit margins and cash flows may be adversely affected.
Increases in the costs, or reduced availability, of raw materials and manufactured components may adversely affect our profitability.
Raw material costs can be volatile. The principal raw materials to produce our products include synthetic rubber, carbon black, process oils, and plastic resins. Principal procured components are primarily made from plastic, carbon steel, aluminum and stainless steel. Material costs represented approximately 51% of our total cost of products sold in 2024. The costs and availability of raw materials and manufactured components can fluctuate due to factors beyond our control, including as a result of existing and potential changes to U.S. policies related to global trade and increased tariffs and trade restrictions. Further, climate change may have an adverse impact on global temperatures, weather patterns, and the frequency and severity of extreme weather and natural disasters, which may adversely affect the availability or pricing for certain raw materials including natural rubber. A significant increase in the price of raw materials, or a restriction in their availability, could materially increase our operating costs and adversely affect our profitability because it is generally difficult to pass through these increased costs to our customers. While we entered into index pricing agreements with some of our customers which provide for a price adjustment based on quoted market prices to attempt to address some of these risks (primarily with respect to steel and rubber), there can be no assurance that commodity price fluctuations will not adversely affect our results of operations and cash flows. In addition, while the use of index pricing adjustments may provide us with some protection from adverse fluctuations in commodity prices, by utilizing these instruments, we potentially forego the benefits that might result from favorable fluctuations in price.
Disruptions in the supply chain could have an adverse effect on our business, financial condition, results of operations and cash flows.
We obtain components and other products and services from numerous suppliers and other vendors throughout the world. We are responsible for managing our supply chain, including suppliers that may be the sole sources of products that we require, that our customers direct us to use or that have unique capabilities that would make it difficult and/or expensive to re-source. In certain instances, entire industries may experience short-term capacity constraints. Any significant disruptions in the automotive industry due to industry-wide parts shortages, global supply chain constraints and price volatility due to increased tariffs and trade restrictions could adversely affect our operations and financial performance. Uncertain economic or industry conditions resulting from such supply chain constraints and trade disputes could result in financial distress within our supply base, thereby further increasing the risk of supply disruption. Furthermore, any economic downturn or other unfavorable conditions in one or more of the regions in which we operate could cause supply disruptions and thereby adversely affect our financial condition, operating results and cash flows.
Work stoppages or other disruptions to our operations could negatively affect our operations and financial performance.
We may experience work stoppages caused by labor disputes under existing collective bargaining agreements or in connection with the negotiation of new agreements given that we have a number of agreements that expire in any given year. Further, there is no certainty that we will be successful in negotiating new collective bargaining agreements that extend beyond the current expiration dates or that new agreements will be on terms as favorable to us as past labor agreements. In addition, it is possible that our workforce will become more unionized in the future. Unionization activities could increase our costs, which could negatively affect our results of operations.
Our operations may also be disrupted by other labor issues, including absenteeism, public health events and government restrictions; major equipment failure with prolonged downtime or a complete loss of critical equipment where either no other comparable equipment exists or the remaining equipment does not have enough capacity to pick up the demand; or natural disaster-related plant closures or disruptions.
Regardless of the cause, any significant disruption to our production could negatively affect our operations, customer relationships and financial performance. Similar disruptions at one or more of our suppliers or our customers’ suppliers could adversely affect our operations if an alternative source of supply were not readily available. Additionally, similar disruptions at our customers’ facilities could result in reduced demand for our products causing us to delay or cancel production and could have an adverse effect on our business.
A disruption in, or the inability to successfully implement upgrades to, our information technology systems, including disruptions relating to cybersecurity as well as data privacy concerns, could adversely affect our business and financial performance.
We rely upon information technology networks, systems and processes, including the information technology networks of third parties such as suppliers and joint venture partners, to manage and support our business. We have implemented a number
of procedures and practices designed to protect against breaches or failures of our systems. Despite the security measures that we have implemented, including those measures to prevent cyber-attacks, our systems could be breached or damaged by computer viruses or unauthorized physical or electronic access. Like other public companies, our computer systems and those of our third-party vendors, partners and service providers are regularly subject to, and will continue to be the target of, computer viruses, malware or other malicious codes (including ransomware), unauthorized access, cyber-attacks or other computer-related penetrations (including through the use of A.I.) which may cause disruptions to our operations. While we have experienced threats to our data and systems, to date, we are not aware that we have experienced a cybersecurity incident that has materially affected our business strategy, results of operations, or financial condition. Over time, however, the sophistication of these threats continues to increase. The preventative actions we take to reduce the risk of cyber incidents and protect our information may be insufficient. A breach of our information technology systems, or those of the third parties on whom we rely, could result in theft of our intellectual property, disruption to business or unauthorized access to customer or personal information. Such a breach could adversely impact our operations and or our reputation and may cause us to incur significant time and expense to cure or remediate the breach.
Further, we continually update and expand our information technology systems to enable us to run our business more efficiently, including the potential incorporation of traditional and generative A.I. solutions into our information systems and processes. The increasing use and evolution of this technology creates potential risks for loss or misuse of sensitive Company data that forms part of any data set that was collected, used, stored, or transferred to run our business, and unintentional dissemination or intentional destruction of confidential information stored in our or our third party providers' systems, portable media or storage devices. All of these risks have the potential to result in significantly increased business and security costs, a damaged reputation, administrative penalties, or costs related to defending legal claims. In addition, if the content, analyses, or recommendations that A.I. programs assist in producing are or are alleged to be deficient, inaccurate, or biased, our business, financial condition, and results of operations and our reputation may be adversely affected. If these systems are not implemented successfully and in a timely, cost-effective, compliant and responsible manner, our operations and business could be disrupted and our ability to report accurate and timely financial results could be adversely affected.
An inability to effectively manage the timing, quality and costs of new program launches could adversely affect our financial performance.
In connection with the award of new business, we may obligate ourselves to deliver new products that are subject to our customers’ timing, performance and quality standards. Given the number and complexity of new program launches, we may experience difficulties managing product quality, timeliness and associated costs. In addition, new program launches require a significant ramp up of costs. Our sales related to these new programs generally are dependent upon the timing and success of our customers’ introduction of new vehicles. An inability to effectively manage the timing, quality and costs of these new program launches could adversely affect our financial condition, operating results and cash flows.
Our success depends in part on our development of improved products, and our efforts may fail to meet the needs of customers on a timely or cost-effective basis.
Our continued success depends on our ability to maintain advanced technological capabilities and knowledge necessary to adapt to changing market demands, as well as to develop and commercialize innovative products. We may be unable to develop new products successfully or to keep pace with technological developments by our competitors and the industry in general, which in recent years includes the rapid development and rising use of digital, A.I. and machine learning technologies. In addition, we may develop specific technologies and capabilities in anticipation of customers’ demands for new innovations and technologies. If such demand does not materialize, we may be unable to recover the costs incurred in the development of such technologies and capabilities. If we are unable to recover these costs or if any such programs do not progress as expected, our business, results of operations and financial condition could be adversely affected.
We may incur material losses and costs as a result of product liability and warranty and recall claims that may be brought against us.
We may be exposed to product liability and warranty claims in the event that our products actually or allegedly fail to perform as specified or expected or the use of our products results, or is alleged to result, in bodily injury and/or property damage. Accordingly, we could experience material warranty or product liability expenses in the future and incur significant costs to defend against these claims. In addition, if any of our products are, or are alleged to be, defective, we may be required to participate in a recall of that product if the defect or the alleged defect relates to automotive safety. Product recalls could cause us to incur material costs and could harm our reputation or cause us to lose customers, particularly if any such recall causes customers to question the safety or reliability of our products. Also, while we possess considerable historical warranty and recall data with respect to the products we currently produce, we do not have such data relating to new products, assembly programs or
technologies, including any new fuel and emissions technology and systems being brought into production, to allow us to accurately estimate future warranty or recall costs.
In addition, the increased focus on systems integration platforms utilizing fuel and emissions technology with more sophisticated components from multiple sources could result in an increased risk of component warranty costs over which we have little or no control and for which we may be subject to an increasing share of liability to the extent any of the other component suppliers are in financial distress or are otherwise incapable of fulfilling their warranty or product recall obligations. Our costs associated with providing product warranties and responding to product recall claims could be material. Product liability, warranty and recall costs may adversely affect our business, results of operations and financial condition.
Our commitment to drive value through culture, innovation and results is dependent on our ability to identify, attract, develop and retain a skilled, engaged and diverse workforce.
Our people are the driving force behind our success at Cooper Standard. Our ability to pursue breakthrough technology innovations, implement cutting-edge manufacturing and business processes, and achieve our operating and strategic goals is dependent on the engagement, skills, experience and knowledge of our employees. Any failure or delay in attracting, retaining and developing such a workforce, including the loss of key technological and leadership personnel, could adversely impact our business, financial condition and operating results.
Our financial condition and results of operations have been previously, and may in the future be, adversely affected by public health events.
We could face risks related to public health events, including epidemics and pandemics like the COVID-19 pandemic. Preventative measures taken to contain or mitigate public health events (including, but not limited to, vaccination, social distancing policies, restrictions on travel and reduced operations and extended closures of many businesses and institutions) may materially impact our financial condition and operations results due to shutdowns of our and our customers’ and suppliers’ facilities; increased operating and production costs; disruptions and financial distress in the supply chain; disruptions in our production cycle; lost or absent members of the workforce; a decline in demand due to an economic downturn; and inability to access capital due to disruptions in the global financial markets.
The full impact of a public health event on our financial condition and operations results will depend on various factors, such as the ultimate duration and scope of the crisis, its impact on our customers, suppliers and logistics partners, how quickly normal operations can resume and the duration and magnitude of the economic downturn caused by the health crisis in our key markets. A public health event may also exacerbate the other risks disclosed in this Item 1A. Risk Factors.
Strategic Risks
We are highly dependent on the automotive industry. A prolonged or material contraction in automotive sales and production volumes could adversely affect our business, results of operations and financial condition.
Automotive sales and production are cyclical and depend on, among other things, general economic conditions and consumer spending, vehicle demand and preferences (which can be affected by a number of factors, including fuel costs, employment levels and the availability of consumer financing). These factors could make it difficult for us, our suppliers and our customers to forecast accurately and plan future business activities. As the volume of automotive production and the mix of vehicles produced fluctuate, the demand for our products also fluctuates. Prolonged or material contraction in automotive sales and production volumes, or significant changes in the mix of vehicles produced, could cause our customers to reduce orders of our products, which could adversely affect our business, results of operations and financial condition and our ability to provide accurate forecasts and guidance.
We may not realize sales represented by awarded business, which could adversely affect our business, financial condition, results of operations and cash flows.
The realization of future sales from awarded business is subject to risks and uncertainties inherent in the cyclicality of vehicle production. In addition, our customers generally have the right to resource awarded business without penalty. Therefore, the ultimate amount of our sales is not guaranteed. If actual production orders from our customers are not consistent with the projections we use in calculating the amount of awarded business, we could realize substantially less sales and profit over the life of these awards than currently projected.
Pricing pressures and other commercial adjustments may adversely affect our business.
Upfront and ongoing pricing strategies and demands could result in either unsatisfactory profitability, loss of replacement or targeted business, and/or exposure to competitive challenges and resourcing. Further, the automotive industry
continues to experience aggressive pricing pressure from customers. Vehicle manufacturers often seek price reductions in both the initial bidding process and during the term of the contract and may seek other commercial adjustments, including but not limited to new or adjusted demands relating to annual commercial productivity, quality standards, research and development funding, packaging and materials and demands for the Company to share in productivity and efficiency savings in excess of our cost reduction targets. Price reductions historically have adversely impacted our sales and profit margins and may do so in the future. If we are not able to offset price reductions through improved operating efficiencies and reduced expenditures, those price reductions may have a negative impact on our financial condition.
Our business could be adversely affected if we lose any of our largest customers or significant platforms.
While we provide parts to virtually every major global OEM for use on a wide range of different platforms, sales to our three largest customers, Ford, GM, and Stellantis, on a worldwide basis represented approximately 56% of our sales for the year ended December 31, 2024. Our ability to reduce the risks inherent in certain concentrations of business will depend, in part, on our ability to continue to diversify our sales on a customer, product, platform and geographic basis. Although business with each customer is typically split among numerous contracts, the loss of a major customer, significant reduction in purchases of our products by such customer, or any discontinuance or resourcing of a significant platform could adversely affect our business, results of operations and financial condition.
We operate in a highly competitive industry and efforts by our competitors to gain market share could adversely affect our financial performance.
The automotive parts industry is highly competitive. We face numerous competitors in each of our product lines. In general, there are three or more significant competitors and numerous smaller competitors for most of the products we offer. We also face competition for certain of our products from suppliers producing in lower-cost regions such as Asia and Eastern Europe. Our competitors’ efforts to grow market share could exert downward pressure on the pricing of our products and our margins, or result in the resourcing of platforms by our customers.
The benefits of our continuous improvement programs and other cost savings plans may not be fully realized.
Our operations strategy includes continuous improvement programs and implementation of lean manufacturing tools across all facilities to achieve cost savings and increased performance. Further, we have and may continue to initiate restructuring actions designed to improve future profitability and competitiveness. The cost savings that we anticipate from these initiatives may not be achieved on schedule or at the level we anticipate, and could be negatively impacted by lower-than-expected production volumes. If we are unable to realize these anticipated savings, our operating results and financial condition may be adversely affected.
We may continue to incur significant costs related to manufacturing facility closings or consolidation which could have an adverse effect on our financial condition.
If we close or consolidate manufacturing locations, the exit costs associated with such closures or consolidation, including employee termination costs, may be significant. Such costs could negatively affect our cash flows, results of operations and financial condition.
We are subject to other risks associated with our international operations.
We have significant manufacturing operations outside the United States, including joint ventures and other alliances. Our operations are located in 20 countries, and we export to several other countries. In 2024, approximately 78% of our sales were attributable to products manufactured outside the United States. Risks inherent in our international operations include:
•currency exchange rate fluctuations, currency controls and restrictions, and the ability to hedge currencies;
•changes in local economic conditions;
•repatriation restrictions or requirements, including tax increases on remittances and other payments by our foreign subsidiaries;
•global sovereign fiscal uncertainty and hyperinflation in certain foreign countries;
•changes in laws and regulations, including laws or policies governing the terms of foreign trade, and in particular increased trade restrictions, tariffs, or taxes or the imposition of embargoes on imports from countries where we manufacture products;
•operating in foreign jurisdictions where the ability to protect and enforce our intellectual property rights is limited as a statutory or practical matter;
•exposure to possible expropriation or other government actions;
•disease, pandemics or other severe public health events; and
•exposure to local political or social unrest including resultant acts of war, terrorism, or similar events, including the wars in Ukraine and the Middle East and the related sanctions imposed on Russia.
The occurrence of any of these risks may adversely affect the results of operations and financial condition of our international operations and our business as a whole.
In addition, we are subject to the Foreign Corrupt Practices Act (the “FCPA”) and other laws which prohibit improper payments to foreign governments and their officials by U.S. and other business entities. Certain of the countries in which we operate present heightened corruption risks, which therefore increases the risks of our exposure under the FCPA and other applicable anti-bribery and corruption laws and regulations.
A portion of our operations are conducted by joint ventures which have unique risks.
Certain of our operations are carried out by joint ventures. In joint ventures, we share the management of the company with one or more partners who may not have the same goals, resources or priorities as we do. The operations of our joint ventures are subject to agreements with our partners, which typically include additional organizational formalities as well as requirements to share information and decision making and may also limit our ability to sell our interest. Additional risks include one or more partners failing to satisfy contractual obligations, a change in ownership of any of our partners and our limited ability to control our partners’ compliance with applicable laws, including the FCPA. Any such occurrences could adversely affect our financial condition, operating results, cash flow or reputation.
Any acquisitions or divestitures we make may be unsuccessful, may take longer than anticipated or may negatively impact our business, financial condition, results of operations and cash flows.
We may pursue acquisitions or divestitures in the future as part of our strategy. Acquisitions and divestitures involve numerous risks, including identifying attractive target acquisitions, undisclosed risks affecting the target, difficulties integrating acquired businesses, the assumption of unknown liabilities, potential adverse effects on existing customer or supplier relationships, and the diversion of management’s attention from day-to-day business. We may not have, or be able to raise on acceptable terms, sufficient financial resources to make acquisitions. Our ability to make investments may also be limited by the terms of our existing or future financing arrangements. Any acquisitions or divestitures we pursue may not be successful or prove to be beneficial to our operations and cash flow.
Financial Risks
Global, market and economic conditions could impact our ability to access liquidity sources.
Our continued access to sources of liquidity depends on multiple factors, including global economic conditions, public health events and any global supply chain disruptions on our customers and their production rates, the costs of raw materials, the state of the overall automotive industry, the condition of global financial markets, the availability of sufficient amounts of financing, our operating performance and cash flows and our credit ratings. In particular, the global automotive industry is susceptible to uncertain economic conditions that could adversely impact new vehicle demand and production, and business conditions may vary significantly from period to period or region to region. In recent years, global automotive production was negatively impacted by lingering impacts of the COVID-19 pandemic and broad supply chain challenges stemming, in part, from a sharp rebound in overall industrial demand. Further, rising inflation, interest rates and supply chain challenges contributed to global economic uncertainty. In addition, continuing military actions in Eastern Europe and the Middle East are having broad negative impacts on key sectors of the global economy. Our business is also directly affected by the automotive vehicle production rates in North America, Europe, Asia Pacific and South America which have been adversely impacted by a series of events in recent years.
Our ability to borrow against our senior asset-based revolving credit facility (the “ABL Facility”) is limited to our borrowing base, which consists primarily of our U.S. and Canadian accounts receivable and inventory. Production shutdowns or disruptions in both the United States and Canada could lead to significant reductions in these working capital balances and significantly decrease our ability to borrow under our ABL Facility.
In addition, if the Company has borrowing availability under its ABL Facility less than the greater of (i) $15.0 million and (ii) 10% of the Borrowing Base (as defined in the ABL Facility), it must be in compliance with a springing Fixed Charge Coverage Ratio maintenance covenant of 1.00:1.00. Any adverse effects on the Company’s business due to global, market and economic conditions may adversely impact the Company’s ability to satisfy such covenant. As of December 31, 2024, there were
no obligations outstanding under the ABL Facility, the Company’s borrowing base was $176.7 million and the monthly fixed charge coverage ratio was at a level that provided the Company full access to the borrowing base. Net of $7.6 million of outstanding letters of credit, the Company effectively had $169.2 million available for borrowing under its ABL Facility.
Furthermore, production shutdowns or disruptions will result in working capital swings which could result in increased outflows. As a result of current ecomonic conditions and global supply chain disruptions, we may be required to raise additional capital, and our access to and cost of financing will depend on, among other things, our performance, changing global economic conditions, conditions in the global financing markets, the availability of sufficient amounts of financing, our prospects and our credit ratings. Such capital may not be available on favorable terms or at all.
Developments in new or ongoing conflicts around the world and related disruptions could adversely affect our liquidity, business, and results of operations.
Developments in new or ongoing conflicts or civil unrest around the world, such as the military conflicts between Russia and Ukraine, Israel and Hamas, and other conflicts and escalating tensions in the Middle East and other regions of the world, may cause significant disruptions to the global financial system, international trade, and the transportation and energy sectors, among others, potentially impacting supply chain and commodity prices which may result in substantial inflation. These disruptions together with the uncertainty created by these conflicts could have recessionary effects on the global economy. Prolonged inflationary conditions and periods of high interest rates could further negatively affect U.S. and international commerce and exacerbate or further extend the period of high energy prices and supply chain constraints. These and other issues resulting from a global economic slowdown and turmoil in the financial markets may continue to adversely affect the automotive industry, which may lead to a decline in the general demand for our products, our profitability or both. We do not have operations in Ukraine, Russia or the Middle East, nor do we sell into these markets. Nonetheless, if there is further global economic slowdown and a continuation of these conflicts, our liquidity, business, and results of operations may continue to be adversely affected.
We have a substantial amount of indebtedness, which could have a material adverse effect on our financial condition and our ability to obtain financing in the future and to react to changes in our business.
We have a significant amount of indebtedness. As of December 31, 2024, we had total indebtedness of $1,100.3 million. Our substantial amount of debt and our debt service obligations could limit our ability to satisfy our obligations, limit our ability to operate our business and impair our competitive position. For example, it could:
•make it more difficult for us to satisfy our obligations;
•increase our vulnerability to general adverse economic and industry conditions, including interest rate fluctuations, because a portion of our borrowings accrues interest at variable rates;
•require us to dedicate a substantial portion of our cash flows from operations to payments on our debt and debt service obligations, which would reduce the availability of cash to fund working capital, capital expenditures, research and development efforts, acquisitions or other general corporate purposes;
•limit our flexibility in planning for, or reacting to, changes in our business and the markets in which we compete;
•place us at a disadvantage compared to competitors that may have less debt; and
•limit our ability to obtain additional debt or equity financing for working capital, capital expenditures, research and development efforts, debt service requirements, acquisitions and general corporate purposes.
Our ability to make scheduled payments on our debt or to refinance these obligations depends on our financial condition, operating performance and our ability to generate cash in the future. If our cash flows and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay investments and capital expenditures, sell material assets, seek additional capital or restructure or refinance our indebtedness, any of which could have a material adverse effect on our business, results of operations and financial condition. In addition, we may not be able to effect any of these actions, if necessary, on commercially reasonable terms or at all. Our ability to restructure or refinance our indebtedness will depend on the condition of the capital markets and our financial condition at such time. Any refinancing of our debt could be at higher interest rates and may require us to comply with more onerous covenants, which could further restrict our business operations. The terms of existing or future debt instruments, including the credit agreement governing the ABL Facility and the indentures governing the 13.50% Cash Pay / PIK Toggle Senior Secured First Lien Notes due 2027 (the “First Lien Notes”) and the 5.625% Cash Pay / 10.625% PIK Toggle Senior Secured Third Lien Notes due 2027 (the “Third Lien Notes”), may limit or prevent us from taking any of these actions. In addition, a reduction of our credit rating could harm our ability to incur additional indebtedness on commercially reasonable terms or at all. An inability to generate sufficient cash flow to satisfy our debt service obligations, or to
refinance or restructure our obligations on commercially reasonable terms or at all, would have an adverse effect, which could be material, on our business, financial condition and results of operations, as well as on our ability to satisfy our obligations in respect of the 5.625% Senior Notes due 2026 (the “2026 Senior Notes”), the First Lien Notes, the Third Lien Notes, or the ABL Facility.
In addition, we and our subsidiaries may be able to incur other substantial additional indebtedness in the future. Although the credit agreement governing the ABL Facility and the indentures governing the First Lien Notes and the Third Lien Notes contain certain limitations on our ability to incur additional indebtedness, such restrictions are subject to a number of qualifications and exceptions, and the indebtedness incurred in compliance with these restrictions could be substantial. To the extent that we incur additional indebtedness or incur such other obligations that may be permitted under our debt instruments, the risks associated with our substantial indebtedness described above, including our potential inability to service our debt, will increase.
Our variable rate indebtedness subjects us to interest rate risk, which could cause our indebtedness service obligations to increase significantly.
The borrowings under the ABL Facility are at variable rates of interest and expose us to interest rate risk. If interest rates increase, our debt service obligations on the variable rate indebtedness would increase even though the amount borrowed remained the same, and our net income and cash flows, including cash available for servicing our indebtedness, would correspondingly decrease.
Secured overnight financing rate (“SOFR”) and other interest rates that are indices deemed to be “benchmarks” are the subject of recent and ongoing national, international and other regulatory guidance and proposals for reform. Some of these reforms are already effective, while others are still to be implemented. These reforms may cause such benchmarks to perform differently than in the past, to be replaced or disappear entirely, or have other consequences that cannot be predicted. Any such consequence could have a material adverse effect on our existing facilities or our future debt linked to such a “benchmark” and our ability to service debt that bears interest at floating rates of interest.
Our debt instruments impose significant operating and financial restrictions on us and our subsidiaries.
The credit agreements governing the ABL Facility and the indentures governing the First Lien Notes and the Third Lien Notes impose significant operating and financial restrictions and limit our ability, among other things, to:
•incur, assume or permit to exist additional indebtedness (including guarantees thereof);
•pay dividends or certain other distributions on our capital stock or repurchase our capital stock;
•prepay, redeem or repurchase indebtedness;
•incur liens on assets;
•make certain investments or other restricted payments;
•allow to exist certain restrictions on the ability of our restricted subsidiaries to pay dividends or make other payments to us;
•engage in transactions with affiliates; and
•sell certain assets or merge or consolidate with or into other companies.
Moreover, our ABL Facility provides the agent considerable discretion to impose reserves, which could materially reduce the amount of borrowings that would otherwise be available to us.
As a result of these covenants and restrictions (including borrowing base availability), we are limited in how we conduct our business, and we may be unable to raise additional debt or equity financing to compete effectively or to take advantage of new business opportunities or acquisitions. The terms of any future indebtedness we may incur could include more restrictive covenants. We may not be able to maintain compliance with these covenants in the future and, if we fail to do so, we may not be able to obtain waivers from the lenders and/or amend the covenants in such agreements. Our failure to comply with the restrictive covenants described above as well as others contained in our future debt instruments from time to time could result in an event of default, which, if not cured or waived, could result in our being required to repay these borrowings before their due date. If we are forced to refinance these borrowings on less favorable terms or if we are unable to refinance such borrowings at all, our financial condition, results of operations and cash flows could be adversely affected.
If there were an event of default under any of the agreements relating to our outstanding indebtedness whether as a result of a payment default, covenant breach or otherwise, the holders of the defaulted debt could cause all amounts outstanding with respect to that debt to be due and payable immediately. Our assets or cash flow may not be sufficient to fully repay borrowings under our outstanding debt instruments if accelerated upon occurrence of an event of default. Further, if we are unable to repay, refinance or restructure our indebtedness under our secured debt, the holders of such debt could exercise remedies against the collateral securing that indebtedness with the holders of the First Lien Notes receiving full recovery on applicable collateral before the holders of the Third Lien Notes. In addition, any event of default or declaration of acceleration under one debt instrument could also result in an event of default under one or more of our other debt instruments. As a result, any default by us on our indebtedness could have a material adverse effect on our business, financial condition and results of operation.
Our expected annual effective tax rate and cash tax liability could be volatile and could materially change as a result of changes in many items including mix of earnings, debt and capital structure and other factors.
Many items could impact our effective tax rate and cash tax liability including changes in our debt and capital structure, mix of earnings and many other factors. Our overall effective tax rate is based upon the consolidated tax expense as a percentage of consolidated earnings before tax. However, tax expenses and benefits are not recognized on a consolidated or global basis, but rather on a jurisdictional, legal entity basis. Further, certain jurisdictions in which we operate generate losses where no current financial statement tax benefit is realized. In addition, certain jurisdictions have statutory rates greater than or less than the United States statutory rate. As such, changes in the mix and source of earnings between jurisdictions could have a significant impact on our overall effective tax rate and cash tax liability in future years. Changes in rules related to accounting for income taxes, changes in tax laws and rates or adverse outcomes from tax audits that occur regularly in any of our jurisdictions could also have a significant impact on our overall effective tax rate and cash tax liability in future periods.
Our working capital requirements may negatively affect our liquidity and capital resources.
Our working capital requirements can vary significantly, depending in part on the level, variability and timing of our customers’ worldwide vehicle production and the payment terms with our customers and suppliers. If our working capital needs exceed our cash provided by operating activities, we would look to our cash balances and availability under our borrowing arrangements to satisfy those needs, as well as potential sources of additional capital, which may not be available on satisfactory terms and in adequate amounts, if at all.
Foreign currency exchange rate fluctuations could materially impact our operating results.
Our sales and manufacturing operations outside the United States expose us to currency risks. For our consolidated financial statements, our sales and earnings denominated in foreign currencies are translated into U.S. dollars. This translation is calculated based on average exchange rates during the reporting period. Accordingly, our reported international sales and earnings could be adversely impacted in periods of a strengthening U.S. dollar.
Although we generally produce in the same geographic region as our products are sold, we also produce in countries that predominately sell in another currency. Further, some of our commodities are purchased in or tied to the U.S. dollar; therefore our earnings could be adversely impacted during the periods of a strengthening U.S. dollar relative to other foreign currencies. While we employ financial instruments to hedge certain portions of our foreign currency exposures, our efforts to manage these risks may not be successful and may not completely insulate us from the effects of currency fluctuations.
Impairment charges relating to our goodwill, long-lived assets or intangible assets could adversely affect our results.
We regularly monitor our goodwill, long-lived assets and intangible assets for impairment indicators. In conducting a quantitative goodwill impairment testing, we compare the fair value of our reporting units to their related net book value. If we instead perform a qualitative goodwill impairment test, we assess whether there are any events or circumstances that indicate it is more likely than not that the fair value of our reporting units is less than their related book value. In conducting our impairment analysis of long-lived and intangible assets, we compare the undiscounted cash flows expected to be generated from the long-lived or intangible assets to the related net book values if indicators of impairment are identified. Changes in economic or operating conditions impacting our estimates and assumptions could result in the impairment of our goodwill, long-lived assets or intangible assets. In the event that we determine that our goodwill, long-lived assets or intangible assets are impaired, we may be required to record a significant charge to earnings, which could adversely affect our results.
Certain of our pension plans are currently underfunded, and we may have to make cash contributions to the plans, reducing the cash available for our business.
We sponsor various pension plans worldwide that are underfunded and will require cash contributions. Additionally, if the performance of the assets in our pension plans does not meet our expectations, or if other actuarial assumptions are modified,
our required contributions may be higher than we expect. As of December 31, 2024, our U.S. supplemental employee retirement plan was underfunded by $9.8 million and our non-U.S. pension plans (which typically are pay-as-you-go plans) were underfunded by $81.1 million. If our cash flow from operations is insufficient to fund our worldwide pension liabilities, it could have an adverse effect on our financial condition and results of operations.
As further described in Note 12. “Pensions” to the consolidated financial statements in Item 8. “Financial Statements and Supplementary Data” of this Report, on April 3, 2024, the Company irrevocably transferred approximately $137.0 million of remaining pension benefit obligations and associated plan assets related to the U.S. Pension Plan to a highly rated insurance company, thereby reducing the Company’s pension obligations and assets by the same amount.
Significant changes in discount rates, the actual return on pension assets and other factors could adversely affect our liquidity, results of operations and financial condition.
Our earnings may be positively or negatively impacted by the amount of income or expense recorded related to our pension plans. Generally accepted accounting principles in the United States (“U.S. GAAP”) require that income or expense related to the pension plans be calculated at the annual measurement date using actuarial calculations which reflect certain assumptions. Because these assumptions have fluctuated and will continue to fluctuate in response to changing market conditions, the amount of gains or losses that will be recognized in subsequent periods, the impact on the funded status of the pension plans and the future minimum required contributions, if any, could adversely affect our liquidity, results of operations and financial condition.
Failure to maintain effective controls and procedures could adversely impact our business, financial condition and results of operations.
Regulatory provisions governing the financial reporting of U.S. public companies require that we establish and maintain disclosure controls and internal controls over financial reporting across our operations in 20 countries. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives; as such, they can be susceptible to human error, circumvention or override, and fraud. Failure to maintain adequate, effective controls and procedures could result in potential financial misstatements or other forms of noncompliance that could have an adverse impact on our business, results of operations, financial condition or organizational reputation.
We operate as a holding company and depend on our subsidiaries for cash to satisfy the obligations of the holding company.
Cooper-Standard Holdings Inc. is a holding company. Our subsidiaries conduct all of our operations and own substantially all of our assets. Our cash flow and our ability to meet our obligations depend on the cash flow of our subsidiaries. In addition, the payment of funds in the form of dividends, intercompany payments, tax sharing payments and other payments may be subject to restrictions under the laws of the countries of incorporation of our subsidiaries or their governing documents.
We may not be able to procure insurance at reasonable rates to fully meet our needs.
Integral to our risk management strategy and due to requirements under certain of our contracts, we procure insurance coverage from third-party insurers. There can be no assurance that any of our existing insurance coverage will be renewable upon the expiration of the coverage period or that future coverage will be affordable at needed limits. Such circumstances will lead to an increase in both our overall risk exposure and our operational expenses, disrupt the management of our business, and could have a material adverse effect on our business, financial condition and results of our operations.
Legal and Compliance Risks
We are involved from time to time in legal and regulatory proceedings, claims or investigations which could have an adverse impact on our results of operations and financial condition.
We are involved in legal and regulatory proceedings, claims or investigations that, from time to time, may be significant. These matters typically arise in the normal course of business including, without limitation, commercial or contractual disputes, including warranty claims and other disputes with customers and suppliers; intellectual property matters; personal injury claims; environmental issues; tax matters; employment matters; antitrust matters; anti-corruption matters; or allegations relating to legal compliance by us or our employees.
For further information regarding our legal matters, see Item 3. “Legal Proceedings.” The industries in which we operate are also periodically reviewed or investigated by regulators, which could lead to enforcement actions, fines and penalties or the assertion of private litigation claims. It is not possible to predict with certainty the outcome of claims, investigations and lawsuits, and we could in the future incur judgments, fines or penalties or enter into settlements of lawsuits and claims that could have an adverse effect on our business, results of operations and financial condition in any particular period.
If we are unable to protect our intellectual property or if a third party challenges our intellectual property rights, our business could be adversely affected.
We own or have rights to proprietary technology that is important to our business. We rely on intellectual property laws, patents, trademarks and trade secrets to protect such technology. Such protections, however, vary among the countries in which we market and sell our products, and as a result, we may be unable to prevent third parties from using our intellectual property without authorization. Any infringement or misappropriation of our technology could have an adverse effect on our business and results of operations. We also face exposure to claims by others for infringement of intellectual property rights and could incur significant costs or losses related to such claims. In addition, many of our supply agreements require us to indemnify our customers from third-party infringement claims. These claims, regardless of their merit or resolution, are frequently costly to prosecute, defend or settle and divert the efforts and attention of our management and employees. If any such claim were to result in an adverse outcome, we could be required to take actions which may include: ceasing the manufacture, use or sale of the infringing products; paying substantial damages to third parties, including to customers, to compensate them for the discontinued use of a product or to replace infringing technology with non-infringing technology; or expending significant resources to develop or license non-infringing products, any of which could adversely affect our operations, business and financial condition.
We may be adversely affected by laws and regulations, including environmental, health and safety laws and regulations.
We are subject to various U.S. federal, state and local, and non-U.S. laws and regulations, including those related to environmental, health and safety, financial, tax, customs and other matters. We cannot predict the substance or impact of pending or future legislation or regulations, or the application thereof. The introduction of new laws or regulations or changes in existing laws or regulations, or the interpretations thereof, could increase the costs of doing business for us or our customers or suppliers or restrict our actions and adversely affect our financial condition, results of operations and cash flows.
In particular, we are subject to a broad range of laws and regulations governing emissions to air; discharges to water; noise and odor emissions; the generation, handling, storage, transportation, treatment, reclamation and disposal of chemicals and waste materials; the cleanup of contaminated properties; and health and safety. We may incur substantial costs in complying with these laws and regulations. Many of our current and former facilities have been subject to certain environmental investigations and remediation activities, and we maintain environmental reserves for certain of these sites. Through various acquisitions, we have acquired a number of manufacturing facilities, and we cannot assure that we will not incur material costs or liabilities relating to activities that predate our ownership. Material future expenditures may be necessary if compliance standards change or material unknown conditions that require remediation are discovered. Environmental laws could also restrict our ability to expand our facilities or could require us to acquire costly equipment or to incur other significant expenses. In addition, climate change poses regulatory risks that could harm our results of operations or affect the way we conduct our businesses. For example, new or modified regulations could require us to spend substantial funds to enhance our environmental compliance efforts. If we fail to comply with present and future environmental laws and regulations, we could be subject to future liabilities, which could adversely affect our financial condition, operating results and cash flows.

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ITEM 1B. UNRESOLVED STAFF COMMENTS
Item 1B. Unresolved Staff Comments
None.

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ITEM 2. PROPERTIES
Item 2. Properties
As of December 31, 2024, our operations were conducted through 124 wholly-owned, leased and consolidated joint venture facilities in 20 countries (North America: Canada, Costa Rica, Mexico, United States; Asia Pacific: China, India, Japan, South Korea, Thailand; Europe: Czech Republic, France, Germany, Italy, Netherlands, Poland, Romania, Serbia, Spain, United Kingdom; South America: Brazil), of which 75 are predominantly manufacturing facilities and 49 have design, engineering, administrative or logistics designations. Our corporate headquarters are located in Northville, Michigan. Our manufacturing facilities are located in North America, Europe, Asia and South America. We believe that substantially all of our properties are in generally good condition and there is sufficient capacity to meet current and projected manufacturing, product development and logistics requirements. The following table summarizes our key property holdings by segment:
Segment Type Total Facilities* Owned Facilities
Sealing systems Manufacturing (a)
36 24
Other (b)
8 2
Fluid handling systems Manufacturing (a)
36 14
Other (b)
29 -
Corporate and other Manufacturing (a)
3 1
Other (b)
12 -
(a)Includes multi-activity sites which are predominantly manufacturing.
(b)Includes design, engineering, R&D, administrative and logistics locations.
(*) Excludes 2 unutilized facilities in North America.

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ITEM 3. LEGAL PROCEEDINGS
Item 3. Legal Proceedings
The litigation process is subject to many uncertainties, and the outcome of individual matters is not predictable with assurance. See Note 20. “Contingent Liabilities” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report for discussion of loss contingencies.

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ITEM 4. MINE SAFETY DISCLOSURE
Item 4. Mine Safety Disclosures
Not applicable.
PART II

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ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity
Securities
Market Information
Our common stock has been traded on the NYSE since October 17, 2013 under the symbol “CPS.”
Holders of Common Stock
As of February 7, 2025, there were approximately 5 holders of record of our common stock. This stockholder figure does not include a substantially greater number of holders whose shares are held of record by banks, brokers and other financial institutions.
Dividends
Cooper-Standard Holdings Inc. has never paid or declared a dividend on its common stock. The declaration of any prospective dividends is at the discretion of the Board of Directors and would be dependent upon sufficient earnings, capital requirements, financial position, general economic conditions, state law requirements and other relevant factors. Additionally, our credit agreements governing our ABL Facility and our indentures governing our First Lien Notes, Third Lien Notes, and 2026 Senior Notes contain covenants that, among other things, restrict our ability to pay certain dividends and distributions subject to certain qualifications and limitations. See “Liquidity and Capital Resources” under Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of this Report. We do not anticipate paying any dividends on our common stock in the foreseeable future.
Securities Repurchase Program
In June 2018, our Board of Directors approved a common stock repurchase program (the “2018 Program”) authorizing us to repurchase, in the aggregate, up to $150.0 million of our outstanding common stock. Under the 2018 Program, repurchases may be made on the open market, through private transactions, accelerated share repurchases, round lot or block transactions on the New York Stock Exchange or otherwise, as determined by our management and in accordance with prevailing market conditions and federal securities laws and regulations. We expect to fund any future repurchases from cash on hand and future cash flows from operations. We are not obligated to acquire a particular amount of securities, and the 2018 Program may be discontinued at any time at the Company’s discretion. The 2018 Program was effective beginning November 2018.
We did not repurchase any shares during the years ended December 31, 2024, 2023, or 2022 under the 2018 Program. As of December 31, 2024, we had approximately $98.7 million of repurchase authorization remaining.
Performance Graph
The following graph and corresponding table compare the cumulative total stockholder return for Cooper-Standard Holdings Inc. to the Standard & Poor’s 500 Index and the Standard & Poor’s Supercomposite Auto Parts & Equipment Index based on currently available data. The analysis assumes an initial investment of $100 on December 31, 2019 and reflects the cumulative total return on that investment, including the reinvestment of all dividends where applicable, through December 31, 2024.
Comparison of Cumulative Return
Ticker 12/31/2019 12/31/2020 12/31/2021 12/30/2022* 12/29/2023* 12/31/2024
Cooper-Standard Holdings Inc. CPS $100.00 $104.55 $67.58 $27.32 $58.93 $40.89
S&P 500 SPX $100.00 $116.05 $148.86 $121.65 $153.61 $191.50
S&P Supercomposite Auto Parts & Equipment Index S15AUTP $100.00 $121.71 $149.05 $100.64 $107.08 $85.01
* Represents last trading day of the year.

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ITEM 6. SELECTED FINANCIAL DATA
Item 6. [Reserved]

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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
This management’s discussion and analysis of financial condition and results of operations is intended to assist in understanding and assessing the trends and significant changes in our results of operations and financial condition. Our historical results may not indicate, and should not be relied upon as an indication of, our future performance. Our forward-looking statements reflect our current views about future events, are based on assumptions and are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those contemplated by these statements. See Item 1. “Business-Forward-Looking Statements” for a discussion of risks associated with reliance on forward-looking statements. Factors that may cause differences between actual results and those contemplated by forward-looking statements include, but are not limited to, those discussed below and in Item 1A. “Risk Factors.” Management’s discussion and analysis of financial condition and results of operations should be read in conjunction with our consolidated financial statements and the notes to those statements included in Item 8. “Financial Statements and Supplementary Data” of this Report. References in this Annual Report on Form 10-K (the “Report”) to “we”, “our”, or the “Company” refer to Cooper-Standard Holdings Inc., together with its consolidated subsidiaries.
Executive Overview
Our Business
We design, manufacture and sell sealing and fluid handling systems (consisting of fuel and brake delivery systems and fluid transfer systems) for use primarily in passenger vehicles and light trucks manufactured by global OEMs. In 2024, approximately 86% of our sales consisted of original equipment sold directly to OEMs for installation on new vehicles. The remaining 14% of our sales were primarily to Tier I and Tier II suppliers and non-automotive manufacturers. Accordingly, sales of our products are directly affected by the annual vehicle production of OEMs, particularly the production levels of the vehicles for which we provide specific parts. Most of our products are custom designed and engineered for a specific vehicle platform. Our sales and product development personnel frequently work directly with OEM engineering departments in the design and development of our various products.
Although each OEM may emphasize different requirements as the primary criteria for judging its suppliers, we believe success as an automotive supplier generally requires outstanding performance with respect to quality, price, service, new program launches, design and engineering capabilities, innovation, timely delivery, financial stability, an extensive global footprint, and sustainability. Also, we believe our continued commitment to invest in global common processes is an important factor in servicing global customers with the same quality and consistency of product wherever we produce in the world. This is especially important when supplying products for global platforms.
In addition, to remain competitive and offset continued customer pricing pressure, we must also consistently achieve and sustain cost savings. In an ongoing effort to reduce our cost structure, we run a global continuous improvement program which includes training for our employees, as well as implementation of lean tools, structured problem solving, best business practices, standardized processes and change management. We also continually evaluate opportunities to optimize our manufacturing footprint by consolidating facilities and relocating production as appropriate. We believe we will continue to be successful in our efforts to improve our design and engineering capabilities and manufacturing processes while achieving cost savings, including through our continuous improvement initiatives.
Our OEM sales are generally based upon purchase orders issued by the OEMs, with updated releases for volume adjustments. As such, we typically do not have a defined backlog of orders at any point in time. Once selected to supply products for a particular platform, we typically supply those products for the platform life, which is normally five to eight years, though this term is not guaranteed. In addition, when we are the incumbent supplier to a given platform, we believe we have a competitive advantage in winning the redesign or replacement platform, although future awards are not guaranteed.
In 2024, approximately 59% of our sales were generated in North America. Because of our significant international operations, we are subject to the risks associated with doing business in other countries, such as currency volatility, high interest and inflation rates, and the general political and economic risk that are associated with some of these markets.
Recent Trends and Conditions
General Economic Conditions and Outlook
The global automotive industry is susceptible to uncertain economic conditions that could adversely impact new vehicle demand and production. Business conditions may vary significantly from period to period or region to region. In 2022, global automotive production was negatively impacted by broad supply chain challenges, labor market disruptions and other lingering impacts of the COVID-19 pandemic. In 2023, light vehicle production showed resilience and strong growth, supported by
sustained consumer demand and OEM efforts to replenish depleted inventory levels. This resilience and growth was despite continued uncertainty in the global economy created by continued inflation, rising interest rates and increased geopolitical tension in key regions of the world. In 2024, light vehicle production slowed modestly due to rising inventory levels, relatively high interest rates and affordability concerns, and sustained geopolitical tensions throughout the world. Global commodity markets and pricing have stabilized to a large degree in 2024 and into the beginning of 2025. In 2025, we expect global production will slow further as inventory levels remain high, affordability concerns continue and global economic uncertainty persists. The potential for changes in U.S. trade policy, including the possible imposition of significant tariffs on imported goods, is adding to economic risks and uncertainty globally, and could represent near-term challenges to the automotive industry.
In North America, U.S. consumer confidence has improved from 2023 levels but remains well below pre-pandemic historical averages. The conclusion of recent elections, slowing inflation, the Federal Reserve Board’s recent policy rate actions, and a robust jobs market have been key drivers of improved consumer sentiment. However, uncertainty around U.S. trade policy, including the possible imposition of significant tariffs on imported goods, the timing and magnitude of further interest rate cuts by the Federal Reserve, and increasing consumer debt continue to weigh on economic activity. Economists at the International Monetary Fund (IMF) are expecting the economies of the United States, Canada and Mexico to grow by 2.7 percent, 2.0 percent and 1.4 percent, respectively, in 2025.
In Europe, lower inflation and more stable energy costs are contributing to stronger household consumption. However, economic momentum slowed in the second half of 2024, especially in the manufacturing sector. Ongoing geopolitical tensions and the war in Ukraine continue to pose significant challenges to overall economic growth. Amid this uncertain environment, economists at the IMF are expecting the economy in the Eurozone region to grow by 1.0 percent in 2025.
In the Asia Pacific region, China’s post-COVID-19 economy has been burdened by a protracted property crisis, weak consumer and business confidence, and mounting local government debts. However, China’s economy has shown resilience, supported by a new round of government stimulus actions, a rebound in private consumption and strong exports. Net of these factors, economists at the IMF are expecting the Chinese economy to grow at a rate of 4.6 percent in 2025.
In South America, the risks for the Brazilian economy worsened in the second half of 2024 as increased fiscal spending fueled higher than expected inflation. Brazil’s central bank has raised interest rates to stem inflation but the value of the national currency has fallen rapidly in recent months. In addition, the outlook for exports has softened due to moderating global demand. In view of this uncertain and volatile landscape, economists at the IMF are expecting the growth rate of the Brazilian economy to slow modestly to 2.2 percent in 2025.
Production Levels
Our business is directly affected by the automotive vehicle production rates in North America, Europe, Asia Pacific and South America. These production rates can be impacted periodically by changing macro and micro-economic conditions, geopolitical actions, regional consumer sentiment, labor disruptions and changing regulatory requirements, among other factors.
According to estimates of S&P Global (formerly IHS Markit), global light vehicle production was approximately 89.4 million units in 2024. This reflects a decline of approximately 1.2% globally compared to 2023.
Light vehicle production in certain regions for 2024 and 2023, as well as projections for 2025, are provided in the following table:
(in millions of units) 2025(1)
2024(1)
2023(1)
Projected % Change 2024-2025 % Change 2023-2024
North America 15.1 15.5 15.7 (2.2)% (1.4)%
Europe 16.6 17.1 18.0 (3.0)% (4.7)%
Asia Pacific 52.0 51.7 51.6 0.6% 0.1%
Greater China 30.2 30.1 29.0 0.3% 3.8%
South America 3.1 3.0 2.9 5.5% 1.7%
(1) Production data based on S&P Global, January 2025.
Industry Overview
Competition in the automotive supplier industry is intense and has increased in recent years as OEMs have demonstrated a preference for stronger relationships with fewer suppliers. Because of a growing emphasis on global vehicle platforms, automotive suppliers with a global manufacturing footprint capable of fully servicing customers around the world will typically
have a competitive advantage over smaller, regional competitors. This dynamic is likely to result in further consolidation of competing suppliers within our industry over time.
OEMs have shifted some research and development, design and testing responsibility to suppliers, while simultaneously shortening new product cycle times. To remain competitive, suppliers must have state-of-the-art engineering and design capabilities and continuously improve their engineering, design and manufacturing processes to effectively service the customer. Suppliers are increasingly expected to collaborate on, or assume the product design and development of, key automotive components. This shift requires suppliers to provide innovative solutions to meet evolving technologies aimed at improved emissions and fuel economy.
Increased competitiveness in the industry, as well as customer focus on costs, has resulted in continued pressure on suppliers for price reductions, even in an inflationary environment, which reduces the overall profitability of the supply industry. Consolidations and market share shifts among vehicle manufacturers continue to put additional pressures on the supply chain. These pricing and market pressures will continue to drive our focus on reducing our overall cost structure through continuous improvement initiatives, capital redeployment, restructuring and other cost management processes. In response to ongoing inflationary cost pressures, we have implemented aggressive lean and cost optimization initiatives to help mitigate their impact. In addition, we continue to actively pursue pricing adjustments from our customers to offset higher costs on our existing business, particularly where such costs are market driven and beyond our immediate control.
In addition to the above, other factors will present opportunities for automotive suppliers who are positioned to meet the demands of evolving automotive markets and operating environment, including autonomous and connected vehicles, government regulation, and consumer preferences for environmentally friendly products and technology, such as hybrid and electric vehicle (“EV”) architectures.
Raw Materials
Our business is susceptible to inflationary pressures with respect to raw materials. Abrupt changes in the market prices or availability of certain key raw materials may result in operational and profitability challenges for the Company and the industry as a whole. Since 2020, market prices for key raw materials, such as steel, aluminum, and oil-derived commodities, experienced a period of extreme volatility, which led to significant cost increases for our business. In response, we worked with our customers to implement or expand index-based commercial agreements that have enabled us to partially recover incremental material costs incurred and significantly reduce our exposure and risk related to commodity price fluctuations going forward. Although global commodity markets and pricing largely stabilized in 2024, we will continue working with our customers and suppliers to mitigate ongoing inflationary pressures and material-related cost exposures through a combination of expanded index-based agreements and other commercial enhancements.
Critical Accounting Policies and Estimates
Our significant accounting policies are more fully described in Note 2. “Basis of Presentation and Summary of Significant Accounting Policies” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report. Certain of our accounting policies require the application of significant judgment by management in selecting the appropriate assumptions for calculating financial estimates. These policies require the most difficult, subjective or complex judgments that management makes in the preparation of the financial statements and accompanying notes. We consider an accounting estimate to be critical if (i) it requires us to make assumptions about matters that were uncertain at the time we were making the estimate, and (ii) changes in the estimate or different estimates that we could have selected could have had a material impact on our financial condition or results of operations. Such critical accounting estimates are discussed below. For these, materially different amounts could be reported under varied conditions and assumptions. While other items in our consolidated financial statements require estimation, however, in our judgment, they are not as critical as those discussed below.
Goodwill. Goodwill is tested for impairment by reporting unit as of October 1 of each year and more frequently if events or circumstances indicate that an impairment may exist. We test goodwill for impairment by performing a qualitative assessment or using a quantitative test. If we elect to perform a qualitative assessment and determine it is more likely than not that a reporting unit’s carrying value is more than its fair value, the quantitative test is then performed. Otherwise, no further testing is required. For a quantitative goodwill analysis, fair value is based on the cash flows projected in the reporting units’ strategic plans and long-range planning forecasts, discounted at a risk-adjusted rate of return. Our long-range planning forecasts are based on our assessment of revenue growth rates generally based on industry specific data, external vehicle build assumptions published by widely used external sources, and customer market share data based on known and targeted awards over a three-year period. The projected profit margin assumptions included in the plans are based on the current cost structure and adjustments for anticipated cost reductions or increases. If different assumptions were used in these plans, the related cash flows
used in measuring fair value could be different and impairment of goodwill might be recorded. For the 2024 annual goodwill impairment test, we performed a qualitative assessment and determined that it is more likely than not that the fair values of our Sealing Systems, Fluid Handling Systems, and Industrial Specialty Group reporting units exceeded their carrying values. See Note 9. “Goodwill and Intangible Assets” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.
Long-Lived Assets. We monitor our long-lived assets for impairment indicators on an ongoing basis. If impairment indicators exist, we analyze the undiscounted cash flows expected to be generated from the long-lived asset group compared to the related net book values. If the net book value exceeds the undiscounted cash flows, an impairment loss is measured and recognized. An impairment loss is measured as the difference between the net book value and the fair value of the long-lived assets. Fair value is determined using various valuation approaches depending on the asset type. Fair value of machinery and equipment is based upon either estimated salvage value or estimated orderly liquidation value. Fair value of leased buildings is based on a discounted cash flow approach. Fair value of owned buildings is based on a sales comparison approach or cost approach. When determining fair value, cash flows are estimated using internal budgets based on recent sales data, independent automotive production volume estimates, and customer commitments. If applicable, discount rates are used in fair value calculations where required. Changes in economic or operating conditions impacting these estimates and assumptions could result in the impairment of long-lived assets. In 2024, 2023 and 2022, we recorded impairment charges related to buildings and machinery and equipment. The 2024 impairments were related solely to idle assets and were based on internal assessments. In contrast, for the 2023 and 2022, we engaged a third-party valuation firm to determine fair values in order to calculate impairment charges. See Note 8. “Property, Plant and Equipment” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.
Income Taxes. In determining the provision for income taxes for financial statement purposes, we make estimates and judgments which affect our evaluation of the carrying value of our deferred tax assets as well as our calculation of certain tax liabilities. We evaluate the carrying value of our deferred tax assets on a quarterly basis. In completing this evaluation, we consider all available positive and negative evidence. Such evidence includes historical operating results, the existence of cumulative earnings and losses in the most recent fiscal years, taxable income in prior carryback year(s) if permitted under the tax law, expectations for future pretax operating income which considers forecasted revenue trends within the automotive industry, the time period over which our temporary differences will reverse, and the implementation of feasible and prudent tax planning strategies. Deferred tax assets are reduced by a valuation allowance if, based on the weight of this evidence, it is more likely than not that all or a portion of the recorded deferred tax assets will not be realized in future periods.
Concluding that a valuation allowance is not required is difficult when there is significant negative evidence which is objective and verifiable, such as cumulative losses in recent years. We utilize three years’ cumulative pre-tax book results adjusted for significant permanent book to tax differences as a measure of cumulative results in recent years. In certain jurisdictions, our analysis indicates that we have cumulative three-year historical losses on this basis. This is considered significant negative evidence which is difficult to overcome. However, the three-year loss position is not solely determinative, and, accordingly, management considers all other available positive and negative evidence in its analysis. In the U.S. and certain foreign jurisdictions, we concluded that it is more likely than not that the net deferred tax assets may not be realized in the future. Accordingly, we continue to maintain and adjust as appropriate the valuation allowance related to those net deferred tax assets. However, since future financial results may differ from previous estimates, periodic adjustments to our valuation allowances may be necessary.
In addition, the calculation of our tax benefits and liabilities includes uncertainties in the application of complex tax regulations in a multitude of jurisdictions across our global operations. We recognize tax benefits and liabilities based on our estimate of whether, and the extent to which, additional taxes will be due. We adjust these liabilities based on changing facts and circumstances; however, due to the complexity of some of these uncertainties and the impact of any tax audits, the ultimate resolutions may be materially different from our estimated liabilities. See Note 15. “Income Taxes” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.
Pensions and Postretirement Benefits Other Than Pensions. Included in our results of operations are significant pension and postretirement benefit costs, which are measured using actuarial valuations. Inherent in these valuations are key assumptions, including discount rates, mortality rates, expected returns on plan assets and health care cost trend rates. These assumptions are determined as of the current year measurement date. We consider current market conditions, including changes in interest rates, in making these assumptions. Changes in pension and postretirement benefit costs may occur in the future due to changes in these assumptions. Experience gains and losses as well as the effects of changes in actuarial assumptions are recognized in other comprehensive income. Cumulative actuarial gains and losses in excess of 10% of the projected benefit obligations or the fair value of plan assets for a particular plan are amortized over the average future service period of the
employees in that plan. Our net pension and postretirement benefit costs (income), which included a net one-time, non-cash pension settlement charge of $44.6 million ($46.0 million net of tax), were approximately $51.8 million and $(1.4) million, respectively, for the year ended December 31, 2024. Note that the pension settlement charge resulted from the termination of a certain U.S. pension plan and the related accelerated recognition of accumulated actuarial losses included within AOCI in our consolidated balance sheets. See Note 12. “Pensions” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.
To develop the discount rate for each pension plan, the expected cash flows underlying the plan’s benefit obligations were discounted using a December 31, 2024 pension index to determine a single equivalent rate. To develop our expected return on plan assets, we considered historical long-term asset return experience, the expected investment portfolio mix of plan assets and an estimate of long-term investment returns.
Weighted average assumptions used to determine pension benefit obligations as of December 31, 2024 were as follows:
U.S. Non-U.S.
Discount rate 5.50% 4.21%
Rate of compensation increase N/A (*)
3.14%
* As the U.S. plans are frozen, the rate of compensation increase is not applicable.
Weighted average assumptions used to determine net periodic benefit costs for the year ended December 31, 2024 were as follows:
U.S. Non-U.S.
Discount rate 5.10% 4.00%
Expected return on plan assets N/A (*)
4.07%
Rate of compensation increase N/A (**)
3.20%
* There were no U.S. plan assets as of December 31, 2024, therefore the expected return on plan assets is not applicable.
** As the U.S. plans are frozen, the rate of compensation increase is not applicable.
The sensitivity of our pension cost and obligations to changes in key assumptions, holding all other assumptions constant, is as follows:
Change in assumption Impact on 2025 net periodic benefit cost Impact on PBO as of December 31, 2024
1% increase in discount rate - $0.4 million - $12.0 million
1% decrease in discount rate + $0.1 million + $14.5 million
1% increase in expected return on plan assets - $0.3 million -
1% decrease in expected return on plan assets + $0.3 million -
Aggregate pension net periodic benefit cost is forecasted to be approximately $6.7 million in 2025.
Health care cost trend rates are assumed to reflect market trend, actual experience and future expectations. Health care cost trend rate assumptions used to determine the postretirement benefit obligations as of December 31, 2024 were as follows:
U.S. Non-U.S.
Health care cost trend rate 6.21% 5.00%
Ultimate health care cost trend rate 4.50% 5.00%
Year that the rate reaches the ultimate trend rate 2031 N/A
Aggregate other postretirement net periodic benefit income is forecasted to be approximately $1.0 million in 2025.
The Company’s policy is to fund pension plans such that sufficient assets will be available to meet future benefit requirements and contribute amounts deductible for United States federal income tax purposes or amounts required by local statute. The Company does not anticipate making cash contributions to its U.S. supplemental employee retirement plan in 2025, but estimates cash contributions of approximately $0.4 million to its non-U.S. pension plans in 2025.
The Company does not prefund its postretirement benefit obligations. Rather, payments are made as costs are incurred by covered retirees. We expect net other postretirement benefit payments to be approximately $2.1 million in 2025.
Historical Periods
Refer to Part II - Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Form 10-K for the fiscal year ended December 31, 2023 for discussion of the Results of Operations, Segment Results of Operations, and Liquidity and Capital Resources for the year ended December 31, 2023 compared to the year ended December 31, 2022, which is incorporated by reference herein.
Results of Operations
Year Ended December 31, Change
2024 2023 2024 vs. 2023
(Dollar amounts in thousands)
Sales $ 2,730,893 $ 2,815,879 $ (84,986)
Cost of products sold 2,427,978 2,525,103 (97,125)
Gross profit 302,915 290,776 12,139
Selling, administration & engineering expenses 207,553 215,741 (8,188)
Gain on sale of businesses, net (1,971) (586) (1,385)
Gain on sale of buildings and land, net (3,317) - (3,317)
Amortization of intangibles 6,512 6,804 (292)
Restructuring charges 23,601 18,018 5,583
Impairment charges 713 4,768 (4,055)
Operating income 69,824 46,031 23,793
Interest expense, net of interest income (115,639) (130,077) 14,438
Equity in earnings of affiliates 6,828 3,281 3,547
Loss on refinancing and extinguishment of debt - (81,885) 81,885
Pension settlement and curtailment charges (44,553) (16,035) (28,517)
Other expense, net (17,938) (15,698) (2,241)
Loss before income taxes (101,478) (194,383) 92,905
Income tax (benefit) expense (23,348) 8,933 (32,281)
Net loss (78,130) (203,316) 125,186
Net (income) loss attributable to noncontrolling interests (616) 1,331 (1,947)
Net loss attributable to Cooper-Standard Holdings Inc. $ (78,746) $ (201,985) $ 123,239
Year Ended December 31, 2024 Compared to Year Ended December 31, 2023.
Sales
Year Ended December 31, Variance Due To:
2024 2023 Change Volume / Mix* Foreign Exchange Divestitures
(Dollar amounts in thousands)
Total sales $ 2,730,893 $ 2,815,879 $ (84,986) $ (31,802) $ (20,642) $ (32,542)
* Net of customer price adjustments, including recoveries and the impact of work stoppages initiated by certain labor unions in North America in 2023.
Sales for the year ended December 31, 2024 decreased 3.0%, compared to the year ended December 31, 2023. The decrease in sales was driven by unfavorable volume and mix, net of customer price adjustments including recoveries, the divestitures of our European technical rubber products business and a joint venture in the Asia Pacific region in the prior year, and the negative impact of foreign exchange.
Gross Profit
Year Ended December 31, Variance Due To:
2024 2023 Change Volume / Mix* Foreign Exchange Cost (Decreases) / Increases**
(Dollar amounts in thousands)
Cost of products sold $ 2,427,978 $ 2,525,103 $ (97,125) $ (7,302) $ 15,760 $ (105,583)
Gross profit 302,915 290,776 12,139 (24,500) (36,402) 73,041
Gross profit percentage of sales 11.1 % 10.3 %
* Net of customer price adjustments, including recoveries and the impact of work stoppages initiated by certain labor unions in North America in 2023.
** Net of divestitures and restructuring savings.
Cost of products sold is primarily comprised of materials, labor, manufacturing overhead, freight, depreciation, and other direct operating expenses. Among these, materials represent the largest component, accounting for approximately 51% of total cost of products sold for each of the years ended December 31, 2024 and December 31, 2023. The change in cost of products sold was impacted by favorable manufacturing and purchasing savings through lean initiatives, the divestiture of our European technical rubber products business and a joint venture in the Asia Pacific region in the prior year, the impact of savings from our restructuring initiative in the current year, lower volume and mix, net of recoveries, and lower material input costs, partially offset by higher inflation of labor and overhead, and unfavorable foreign exchange.
Gross profit for the year ended December 31, 2024 increased 4.2% compared to the year ended December 31, 2023. As a percentage of sales, gross profit was 11.1% and 10.3% for the years ended December 31, 2024 and December 31, 2023, respectively. The change was driven by manufacturing and purchasing savings through lean initiatives, the impact of savings from our restructuring initiative in the current year and lower material input costs, partially offset by unfavorable foreign exchange, higher inflation of labor and overhead, unfavorable volume and mix, net of customer price adjustments including recoveries and the divestiture of our European technical rubber products business and a joint venture in the Asia Pacific region in the prior year.
Selling, Administration and Engineering Expenses. Selling, administration and engineering expenses include administrative expenses as well as product engineering and design and development costs. Selling, administration and engineering expenses for the year ended December 31, 2024 were $207.6 million, or 7.6% of sales, compared to $215.7 million, or 7.7% of sales, for the year ended December 31, 2023. The decrease as a percentage of sales was primarily due to lower compensation-related costs driven by savings from our restructuring initiative, partially offset by foreign exchange.
Gain on Sale of Businesses, Net. Gain on sale of businesses, net for the year ended December 31, 2024 was $2.0 million, resulting from the net effect of the sale of our Canadian tooling business. Gain on sale of businesses, net for the year ended December 31, 2023 was $0.6 million, resulting from the net effect of our 2023 divestitures, which included the sale of our European technical rubber products business and the sale of our entire controlling equity interest of a joint venture in the Asia Pacific region. See Note 4. “Divestitures and Deconsolidation” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.
Gain on Sale of Buildings and Land, Net. Gain on sale of buildings and land, net for the year ended December 31, 2024 was $3.3 million, resulting from the sale of a building and land related to one of our Canadian facilities. See Note 8. “Property, Plant and Equipment” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.
Impairment Charges. Non-cash asset impairment charges of $0.7 million and $4.8 million for the years ended December 31, 2024 and December 31, 2023, respectively, related to property, plant and equipment impairment charges.
Restructuring Charges. Restructuring charges for the year ended December 31, 2024 increased $5.6 million compared to the year ended December 31, 2023. Our restructuring actions, which include plant and facility closures as well as workforce reductions, are initiated to maintain a competitive footprint or in response to changes in global and regional automotive markets. The increase was primarily driven by a cost optimization restructuring plan that was implemented in the second quarter of 2024. See Note 6. “Restructuring” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.
Interest Expense, Net of Interest Income. Net interest expense for the year ended December 31, 2024 decreased $14.4 million compared to the year ended December 31, 2023, primarily due to a decrease in payment-in-kind interest on our Third Lien Notes. We elected to pay the third and fourth interest payments, due June 15, 2024 and December 15, 2024, respectively, in cash at the lower 5.625% Cash Pay interest rate as opposed to accruing for interest at the higher 10.625% PIK rate.
Loss on Refinancing and Extinguishment of Debt. Loss on refinancing and extinguishment of debt for the year
ended December 31, 2023 was $81.9 million, which resulted from certain fees and the partial write off of new and unamortized
debt issuance costs and unamortized original issue discount related to refinancing transactions that occurred in 2023.
Pension Settlement and Curtailment Charges. Non-cash settlement and curtailment charges of $44.6 million for the year ended December 31, 2024 primarily related to the termination of a certain U.S. pension plan. Non-cash settlement charges of $16.0 million for the year ended December 31, 2023 primarily related to lump sum payments paid to eligible participants from plan assets as part of the approved termination of the aforementioned U.S. pension plan. See Note 12. “Pensions” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.
Other Expense, Net. Other expense, net for the year ended December 31, 2024 increased $2.2 million compared to the year ended December 31, 2023, primarily due to the unfavorable impact of foreign currency exchange, partially offset by a decrease in periodic benefit cost other than service cost.
Income Tax (Benefit) Expense. Income tax benefit for the year ended December 31, 2024 was $23.3 million on losses before taxes of $101.5 million. This compared to an income tax expense of $8.9 million on losses before taxes of $194.4 million for the year ended December 31, 2023. The tax expense in 2024 and 2023 differed from the statutory rate primarily due to incremental valuation allowances recorded on tax losses generated in the U.S. and certain foreign jurisdictions, the mix of income between the U.S. and foreign sources, tax credits and incentives, and other nonrecurring discrete items. Additionally, the year ended December 31, 2024 includes a $41.5 million benefit for valuation allowance reversals in Brazil, Poland, and a Chinese location.
Segment Results of Operations
Effective January 1, 2024, the Company changed its management reporting structure with the launch of global product line-focused business segments. This resulted in the realignment of its reportable segments, which are determined based on how the CODM manages the business, allocates resources, makes operating decisions and evaluates operating performance. As a result, the Company established two reportable segments: Sealing Systems and Fluid Handling Systems. All other business activities are reported in Corporate, eliminations and other. The segment realignment had no impact on the Company’s consolidated financial position, results of operations, or cash flows. All segment information included in this Annual Report on Form 10-K is reflective of this new structure and prior period information has been revised to conform to the Company’s current period presentation.
The Company uses segment adjusted EBITDA as the measure of earnings to assess the performance of each segment and determines the resources to be allocated to the segments. We have defined adjusted EBITDA as net income before interest, taxes, depreciation, amortization, restructuring expense, and special items.
The following tables present sales and segment adjusted EBITDA for each of the reportable segments.
Year Ended December 31, 2024 Compared with Year Ended December 31, 2023
Sales
Year Ended December 31, Variance Due To:
2024 2023 Change Volume / Mix*
Foreign Exchange
(Dollar amounts in thousands)
Sales to external customers
Sealing Systems $ 1,420,034 $ 1,444,497 $ (24,463) $ (11,164) $ (13,299)
Fluid Handling Systems 1,236,837 1,264,953 (28,116) (20,773) (7,343)
Total for reportable segments $ 2,656,871 $ 2,709,450 $ (52,579) $ (31,937) $ (20,642)
* Net of customer price adjustments, including recoveries and the impact of work stoppages initiated by certain labor unions in North America in 2023.
Sealing Systems. The sales variance due to volume and mix, including customer price adjustments, was primarily driven by lower customer recoveries. The unfavorable foreign currency exchange impact was driven by a $7.7 million impact of the Brazilian Real, $3.1 million impact of the Chinese Renminbi, $2.1 million impact of the Canadian Dollar, and $0.4 million unfavorable impact of all other currencies.
Fluid Handling Systems. The sales variance due to volume and mix, including customer price adjustments, was primarily driven by lower customer volumes. The unfavorable foreign currency exchange impact was driven by a $3.5 million impact of the Korean Won, $2.8 million impact of the Brazilian Real, and $1.0 million unfavorable impact of all other currencies.
Segment adjusted EBITDA
Year Ended December 31, Variance Due To:
2024 2023 Change Volume / Mix*
Foreign Exchange Cost (Increases)/Decreases**
(Dollar amounts in thousands)
Segment adjusted EBITDA
Sealing Systems $ 126,524 $ 114,245 $ 12,279 $ (14,347) $ (20,578) $ 47,204
Fluid Handling Systems 77,686 74,782 2,904 (12,025) (19,004) 34,302
Total for reportable segments $ 204,210 $ 189,027 $ 15,183 $ (26,372) $ (39,582) $ 81,506
* Net of customer price adjustments, including recoveries and the impact of work stoppages initiated by certain labor unions in North America in 2023.
** Net of restructuring savings.
Sealing Systems. The adjusted EBITDA variance due to volume and mix, including customer price adjustments, was primarily driven by lower customer recoveries. The unfavorable foreign currency exchange impact was driven by a $9.6 million impact of the Brazilian Real, $6.6 million impact of the Polish Zloty, $4.2 million impact of the Mexican Peso, and $0.2 million unfavorable impact of all other currencies. The cost decreases were primarily driven by $42.9 million of favorable manufacturing and purchasing savings through lean initiatives, and $18.3 million of all other operational costs primarily driven by restructuring savings and income from unconsolidated joint ventures, partially offset by $14.0 million of unfavorable inflationary costs (including salary and fringes, occupancy, and other costs).
Fluid Handling Systems. The adjusted EBITDA variance due to volume and mix, including customer price adjustments, was driven by lower customer volumes. The unfavorable foreign currency exchange impact was driven by a $10.8 million impact of the Mexican Peso, $4.5 million impact of the Costa Rican Colon, $3.4 million impact of the Brazilian Real, and $0.3 million unfavorable impact of all other currencies. The cost decreases were primarily driven by $37.6 million of favorable manufacturing and purchasing savings through lean initiatives, $4.4 million of favorable material input cost, and $10.6 million of all other operational costs primarily driven by restructuring savings, partially offset by $18.3 million of unfavorable inflationary costs (including salary and fringes, occupancy, and other costs).
Liquidity and Capital Resources
Short and Long-Term Liquidity Considerations and Risks
The sources to fund our ongoing working capital, capital expenditures, debt service and other funding requirements are a combination of cash flows from operations, cash on hand, borrowings under our senior asset-based revolving credit facility (“ABL Facility”) and receivables factoring. We utilize intercompany loans and equity contributions to fund our worldwide operations. However, certain country-specific regulations may impose restrictions or result in increased costs when repatriating funds. See Note 10. “Debt and Other Financing” to the consolidated financial statements in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.
We continue to actively preserve cash and enhance liquidity, including proactively managing our capital expenditures. We continuously monitor and forecast our liquidity situation in light of automotive industry, customer and economic factors, and take the necessary actions to preserve our liquidity and evaluate other financial alternatives that may be available to us should the need arise. Our ability to fund our working capital needs, debt payments and other obligations, and to comply with the financial covenants, including borrowing base limitations under our ABL Facility, depend on our future operating performance and cash flows and many factors outside of our control, including industry production levels, the costs of raw materials, the state of the overall automotive industry and financial and economic conditions, including work stoppages and the continued impact of public
health events, and other factors. Based on those actions and current projections of light vehicle production and customer demand for our products, we believe that our cash flows from operations, cash on hand, availability under our ABL Facility and receivables factoring will enable us to meet our ongoing working capital requirements, capital expenditures, debt service and other funding requirements for the foreseeable future, despite the challenges facing the industry.
Cash Flows
Operating Activities. Net cash provided by operating activities was $76.4 million for the year ended December 31, 2024, compared to net cash provided by operating activities of $117.3 million for the year ended December 31, 2023. The net change was primarily due to changes in net working capital balances.
Investing Activities. Net cash used in investing activities was $45.1 million for the year ended December 31, 2024, compared to net cash used in investing activities of $65.0 million for the year ended December 31, 2023. The net change was primarily due to lower capital expenditures, partially offset by net proceeds of $15.4 million related to our 2023 divestitures which were received in the year ended December 31, 2023. We expect capital expenditures in 2025 to be relatively consistent with 2024, primarily as part of initiatives to consistently lower overall capital spending. We anticipate that we will spend approximately $45.0 to $55.0 million on capital expenditures in 2025.
Financing Activities. Net cash used in financing activities totaled $9.6 million for the year ended December 31, 2024, compared to net cash used in financing activities of $81.1 million for the year ended December 31, 2023. The change was primarily due to refinancing transactions that occurred in 2023.
Off-Balance Sheet Arrangements
As a part of our working capital management, we sell accounts receivable from certain European customers through a third-party financial institution in off-balance sheet arrangements. The amount sold varies each month based on the amount of underlying receivables and cash flow needs. As of December 31, 2024 and 2023, we had $53.4 million and $47.9 million, respectively, of receivables outstanding under receivable transfer agreements entered into by various locations. For the years ended December 31, 2024 and 2023, total accounts receivable factored were $497.4 million and $420.1 million, respectively. Costs incurred on the sale of receivables were $2.9 million, $2.2 million and $0.7 million for the years ended December 31, 2024, 2023 and 2022, respectively. These amounts are recorded in other expense, net in the consolidated statements of operations. These are permitted transactions under the credit agreements governing the ABL Facility and the indentures governing the First Lien Notes, Third Lien Notes, and 2026 Senior Notes.
Other Capital Transactions Impacting Liquidity
Share Repurchase Program
In June 2018, our Board of Directors approved a common stock repurchase program (the “2018 Program”) authorizing us to repurchase, in the aggregate, up to $150.0 million of our outstanding common stock. Under the 2018 Program, repurchases may be made on the open market, through private transactions, accelerated share repurchases, round lot or block transactions on the New York Stock Exchange or otherwise, as determined by management and in accordance with prevailing market conditions and federal securities laws and regulations. We expect to fund any future repurchases from cash on hand and future cash flows from operations. We are not obligated to acquire a particular amount of securities, and the 2018 Program may be discontinued at any time at our discretion. The 2018 Program was effective beginning November 2018. As of December 31, 2024, we had approximately $98.7 million of repurchase authorization under the 2018 Program.
We did not make any repurchases under the 2018 Program during the years ended December 31, 2024, 2023 or 2022.
Contractual Obligations
Our contractual obligations consist of legal commitments requiring us to make fixed or determinable cash payments, regardless of the contractual requirements of the vendor to provide future goods or services. Except as otherwise disclosed, this table does not include information on our recurring purchase of materials for use in production because our raw materials purchase contracts typically do not require fixed or minimum quantities.
The following table summarizes the total amounts due in future periods under all debt agreements at nominal value, undiscounted finance lease commitments and other contractual obligations as of December 31, 2024:
Payment due by period
Total Less than
1 year 1-3 years 3-5 years More than
5 years
(Dollar amounts in millions)
Debt obligations $ 1,091.0 $ 39.8 $ 1,051.2 $ - $ -
Interest on debt obligations 250.6 109.1 141.5 - -
Operating lease obligations 112.9 24.5 33.0 23.0 32.3
Finance lease obligations 23.6 3.6 6.3 6.6 7.0
Total $ 1,478.1 $ 177.0 $ 1,232.0 $ 29.6 $ 39.3
In addition to our contractual obligations and commitments set forth in the table above, we have employment arrangements with certain key executives that provide for continuity of management. These arrangements include payments of multiples of annual salary, certain incentives and continuation of benefits upon the occurrence of specified events in a manner believed to be consistent with comparable companies. As of December 31, 2024, the Company had additional operating leases, primarily for real estate, that have not yet commenced with undiscounted lease payments of approximately $4.0 million.
We also have funding requirements with respect to our pension obligations. We do not expect to make cash contributions to our U.S. supplemental employee retirement plan in 2025, but we do expect to make cash contributions of $0.4 million to our foreign pension plans in 2025. Our minimum funding requirements after 2025 will depend on several factors, including the investment performance of our retirement plans and prevailing interest rates. Our funding obligations may also be affected by changes in applicable legal requirements. We also have payments due with respect to our postretirement benefit obligations. Unlike our pension obligations, we do not prefund our postretirement benefit obligations; instead, payments are made as costs are incurred by covered retirees. We expect net other postretirement benefit payments to be approximately $2.1 million in 2025.
We may be required to make significant cash outlays due to our unrecognized tax benefits. However, due to the uncertainty of the timing of future cash flows associated with our unrecognized tax benefits, we are unable to make reasonably reliable estimates of the period of cash settlement, if any, with the respective taxing authorities. Accordingly, unrecognized tax benefits of $10.6 million as of December 31, 2024 have been excluded from the contractual obligations table above. See Note 15. “Income Taxes” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.
Excluded from the contractual obligations table above are open purchase orders as of December 31, 2024 for raw materials, supplies and capital expenditures in the normal course of business, supply contracts with customers, distribution agreements, joint venture agreements and other contracts without express funding requirements.
Other Matters
We may, from time to time, seek to purchase our outstanding debt securities or loans, including the First Lien Notes, Third Lien Notes, and 2026 Senior Notes. Such transactions could be privately negotiated or open market transactions, pursuant to tender offers or otherwise. Any such purchases will be made in our sole discretion in light of market conditions, applicable limitations contained in the agreements governing our indebtedness and other relevant factors. The amounts involved in any such purchase transactions, individually or in the aggregate, may be material. Any such purchases may equate to a substantial amount of a particular class or series of debt, which may reduce the trading liquidity of such class or series.
In the third quarter of 2023, we designated Liveline Technologies, Inc. (“Liveline”) as an unrestricted subsidiary under the terms of certain of its debt agreements. Despite this designation, Liveline remains a wholly-owned subsidiary of Cooper-Standard Automotive Inc. Liveline recognized a net loss of $2.5 million and $0.6 million for the years ended December 31, 2024 and 2023, respectively. As of December 31, 2024 and 2023, Liveline had less than $0.5 million and less than $0.1 million of gross assets, respectively, and will rely on Cooper Standard for necessary funding until it is able to sustain itself through sales of its products and services.
Non-GAAP Financial Measures
In evaluating our business, management considers EBITDA and Adjusted EBITDA to be key indicators of our operating performance. Our management also uses EBITDA and Adjusted EBITDA:
•because similar measures are utilized in the calculation of the financial covenants and ratios contained in our financing arrangements;
•in developing our internal budgets and forecasts;
•as a significant factor in evaluating our management for compensation purposes;
•in evaluating potential acquisitions;
•in comparing our current operating results with corresponding historical periods and with the operational performance of other companies in our industry; and
•in presentations to the members of our board of directors to enable our board of directors to have the same measurement basis of operating performance as is used by management in their assessments of performance and in forecasting and budgeting for our company.
In addition, we believe EBITDA and Adjusted EBITDA and similar measures are widely used by investors, securities analysts and other interested parties in evaluating our performance. We define Adjusted EBITDA as net income (loss) plus income tax expense (benefit), interest expense, net of interest income, depreciation and amortization or EBITDA, as adjusted for items that management does not consider to be reflective of our core operating performance. These adjustments include, but are not limited to, restructuring costs, certain impairment charges, non-cash fair value adjustments and acquisition-related costs.
EBITDA and Adjusted EBITDA are not financial measurements recognized under U.S. GAAP, and when analyzing our operating performance, investors should use EBITDA and Adjusted EBITDA as a supplement to, and not as alternatives for, net income (loss), operating income, or any other performance measure derived in accordance with U.S. GAAP, nor as an alternative to cash flow from operating activities as a measure of our liquidity. EBITDA and Adjusted EBITDA have limitations as analytical tools, and they should not be considered in isolation or as substitutes for analysis of our results of operations as reported under U.S. GAAP. These limitations include the following:
•they do not reflect our cash expenditures or future requirements for capital expenditure or contractual commitments;
•they do not reflect changes in, or cash requirements for, our working capital needs;
•they do not reflect interest expense or cash requirements necessary to service interest or principal payments under our ABL Facility, First Lien Notes, Third Lien Notes, and 2026 Senior Notes;
•they do not reflect certain tax payments that may represent a reduction in cash available to us;
•although depreciation and amortization are non-cash charges, the assets being depreciated or amortized may have to be replaced in the future, and EBITDA and Adjusted EBITDA do not reflect cash requirements for such replacements; and
•other companies, including companies in our industry, may calculate these measures differently and, as the number of differences in the way companies calculate these measures increases, the degree of their usefulness as a comparative measure correspondingly decreases.
In addition, in evaluating Adjusted EBITDA, it should be noted that in the future, we may incur expenses similar to the adjustments in the below presentation. Our presentation of Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by special items.
The following table provides a reconciliation of EBITDA and Adjusted EBITDA from net loss, which is the most comparable financial measure in accordance with U.S. GAAP:
Year Ended December 31,
2024 2023 2022
(Dollar amounts in thousands)
Net loss attributable to Cooper-Standard Holdings Inc. $ (78,746) $ (201,985) $ (215,384)
Income tax (benefit) expense (23,348) 8,933 17,291
Interest expense, net of interest income 115,639 130,077 78,514
Depreciation and amortization 103,565 109,931 122,476
EBITDA $ 117,110 $ 46,956 $ 2,897
Restructuring charges 23,601 18,018 18,304
Deconsolidation of joint venture (1)
- - 2,257
Impairment charges (2)
713 4,768 43,710
Gain on sale of businesses, net (3)
(1,971) (586) -
Gain on sale of buildings and land, net (4)
(3,317) - (33,391)
Indirect tax adjustments (5)
- - 1,409
Loss on refinancing and extinguishment of debt (6)
- 81,885 -
Pension settlement and curtailment charges (7)
44,553 16,035 2,682
Adjusted EBITDA $ 180,689 $ 167,076 $ 37,868
(1)Loss attributable to deconsolidation of a joint venture in the Asia Pacific region, which required adjustment to fair value.
(2)Non-cash impairment charges in 2024 related to idle assets in certain locations in Asia Pacific. Non-cash impairment charges in 2023 related to certain assets in Europe and Asia Pacific. Non-cash impairment charges in 2022 related to operating performance and idle assets in certain locations in North America, Europe and Asia Pacific.
(3)Gain on sale of businesses related to divestitures in 2024 and 2023.
(4)In 2024, the Company recognized a gain on the sale of building and land related to a Canadian facility. In 2022, the Company recognized a gain on a sale-leaseback agreement on one of its European facilities.
(5)Impact of indirect tax adjustments in 2022.
(6)Loss on refinancing and extinguishment of debt related to refinancing transactions in 2023.
(7)Non-cash net pension settlement and curtailment charges and administrative fees incurred related to certain of our U.S. and non-U.S. pension plans.
Recent Accounting Pronouncements
See Note 3. “New Accounting Pronouncements” to the consolidated financial statements included in Item 8. “Financial Statements and Supplementary Data” of this Report for additional information.

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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
We are exposed to fluctuations in interest rates, currency exchange rates and commodity prices. We actively manage our exposure to risk from changes in foreign currency exchange rates through the use of derivative financial instruments in accordance with management’s guidelines. We do not enter into derivative instruments for trading or speculative purposes. See Item 8. “Financial Statements and Supplementary Data,” specifically Note 11. “Fair Value Measurements and Financial Instruments” to the consolidated financial statements.
Foreign Currency Exchange Rate Risk. We use forward foreign exchange contracts to reduce the effect of fluctuations in foreign exchange rates on a portion of forecasted sales, material purchases, operating expenses and certain assets and liabilities. As of December 31, 2024, the notional amount of these contracts was $188.1 million. As of December 31, 2024, the fair value of the Company’s forward foreign exchange contracts was a liability of $3.8 million. The potential fair value of the forward foreign exchange contracts from a hypothetical 10% adverse or favorable movement in the foreign currency exchange rates in relation to the U.S. Dollar is as follows:
December 31, 2024 December 31, 2023
10% strengthening of U.S. Dollar - $17.3 million - $16.4 million
10% weakening of U.S. Dollar + $12.9 million + $21.2 million
These estimates assume a parallel shift in all currency exchange rates and, as a result, may overstate the potential impact to earnings because currency exchange rates do not typically move all in the same direction.
In addition to transactional exposures, our operating results are impacted by the translation of our foreign operating income into U.S. dollars. In 2024, net sales outside of the United States accounted for 78% of our consolidated net sales, although certain non-U.S. sales are U.S. dollar denominated. We do not enter into foreign exchange contracts to mitigate this exposure.
Interest Rates. The Company historically used interest rate swap contracts to create fixed interest payments on variable rate debt instruments in order to manage exposure to fluctuations in interest rates. As of December 31, 2024 and 2023, we did not have any outstanding debt at variable interest rates, and therefore did not enter into any interest rate swap contracts in 2024 or 2023.
Commodity Prices. We have commodity price risk with respect to purchases of certain raw materials, including natural gas and carbon black. Raw material, energy and commodity costs have been extremely volatile over the past several years, though global commodity markets have stabilized to a large degree in 2024. We did not enter into any commodity derivative instruments in 2024 or 2023. We will continue to evaluate, and may use, derivative financial instruments to manage our exposure to raw material, energy and commodity price fluctuations in the future.

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Item 8. Financial Statements and Supplementary Data
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
Annual Financial Statements
Page
Report of Ernst & Young LLP, Independent Registered Public Accounting Firm (PCAOB ID: 42)
Report of Ernst & Young LLP, Independent Registered Public Accounting Firm, Internal Control over Financial Reporting 43
Consolidated statements of operations for the years ended December 31, 2024, 2023 and 2022
Consolidated statements of comprehensive income (loss) for the years ended December 31, 2024, 2023 and 2022
Consolidated balance sheets as of December 31, 2024 and December 31, 2023
Consolidated statements of changes in equity for the years ended December 31, 2024, 2023 and 2022
Consolidated statements of cash flows for the years ended December 31, 2024, 2023 and 2022
Notes to consolidated financial statements 49
Schedule II-Valuation and Qualifying Accounts 84
Report of Independent Registered Public Accounting Firm
To the Stockholders and the Board of Directors of Cooper-Standard Holdings Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Cooper-Standard Holdings Inc. (the Company) as of December 31, 2024 and 2023, the related consolidated statements of operations, comprehensive income (loss), changes in equity and cash flows for each of the three years in the period ended December 31, 2024, and the related notes and financial statement schedule listed in the Index at Item 15(a)2 (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated February 14, 2025 expressed an unqualified opinion thereon.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Income Taxes - Realizability of Deferred Tax Assets in Brazil
Description of the Matter
As described in Note 15, as of December 31, 2024, the Company has consolidated deferred tax assets of $502 million with a valuation allowances of $405 million. A valuation allowance is provided on deferred tax assets if the Company determines that it is more likely than not that the asset will not be realized. In making such determination, the Company considers all available evidence, both positive and negative, regarding the realization of the deferred tax assets and the assessment of the likelihood of sufficient future taxable income. Sources of taxable income include taxable income in prior carryback year(s) if permitted under the tax law, future reversals of existing deferred tax assets and liabilities, tax planning strategies that are prudent and feasible, and projections of future taxable income (exclusive of the reversals of existing deferred tax assets and liabilities).
During 2024, the Company determined it was more likely than not that the Brazil deferred tax assets are realizable. As a result, the Company released the valuation allowance related to these deferred tax assets of $23 million and recorded a corresponding net income tax benefit. We identified as a critical audit matter management’s determination that the positive evidence of the three-year trend of objective and verifiable taxable income and forecasts of continued taxable income outweighed the negative evidence of historical losses in Brazil and volatility because of the judgment required by management to determine forecasted taxable income. This required a higher degree of auditor judgment and an increased extent of effort, including the need to involve our income tax specialists, when performing audit procedures to evaluate the Company’s assessment.
How We Addressed the Matter in Our Audit
We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls relating to the realizability of deferred tax assets. This included controls over management’s projections of future taxable income.
To test the realizability of the Company’s deferred tax assets for the Brazil jurisdiction, our audit procedures included evaluating the time period over which temporary differences are expected to reverse, evaluating the assumptions used by the Company to develop projections of future taxable income, and testing the calculations of existing temporary book-tax differences. We evaluated the assumptions used by the Company to develop projections of future taxable income for the Brazil jurisdiction and tested the completeness and accuracy of the underlying data used in its projections. We compared the projections of future taxable income for the Brazil jurisdiction with the actual results of prior periods and considered external data sources and historical trends, to the extent applicable. Our income tax specialists were used to assist in the evaluation of the realizability of the Company’s deferred tax assets for the Brazil jurisdiction, including consideration of applicable tax statutes.
/s/ Ernst & Young LLP
We have served as the Company’s auditor since 2005.
Detroit, Michigan
February 14, 2025
Report of Independent Registered Public Accounting Firm
To the Stockholders and the Board of Directors of Cooper-Standard Holdings Inc.
Opinion on Internal Control Over Financial Reporting
We have audited Cooper-Standard Holdings Inc.’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, Cooper-Standard Holdings Inc. (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on the COSO criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2024 and 2023, the related consolidated statements of operations, comprehensive income (loss), changes in equity and cash flows for each of the three years in the period ended December 31, 2024, and the related notes and financial statement schedule listed in the Index at Item 15(a)2 and our report dated February 14, 2025 expressed an unqualified opinion thereon.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.
Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ Ernst & Young LLP
Detroit, Michigan
February 14, 2025
COOPER-STANDARD HOLDINGS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollar amounts in thousands except per share amounts)
Year Ended December 31,
2024 2023 2022
Sales $ 2,730,893 $ 2,815,879 $ 2,525,391
Cost of products sold 2,427,978 2,525,103 2,395,600
Gross profit 302,915 290,776 129,791
Selling, administration & engineering expenses 207,553 215,741 199,455
Gain on sale of businesses, net (1,971) (586) -
Gain on sale of buildings and land, net (3,317) - (33,391)
Amortization of intangibles 6,512 6,804 6,715
Restructuring charges 23,601 18,018 18,304
Impairment charges 713 4,768 43,710
Operating income (loss) 69,824 46,031 (105,002)
Interest expense, net of interest income (115,639) (130,077) (78,514)
Equity in earnings (losses) of affiliates 6,828 3,281 (8,817)
Loss on refinancing and extinguishment of debt - (81,885) -
Pension settlement and curtailment charges (44,553) (16,035) (2,682)
Other expense, net (17,938) (15,698) (5,485)
Loss before income taxes (101,478) (194,383) (200,500)
Income tax (benefit) expense (23,348) 8,933 17,291
Net loss (78,130) (203,316) (217,791)
Net (income) loss attributable to noncontrolling interests (616) 1,331 2,407
Net loss attributable to Cooper-Standard Holdings Inc. $ (78,746) $ (201,985) $ (215,384)
Loss per share:
Basic $ (4.48) $ (11.64) $ (12.53)
Diluted $ (4.48) $ (11.64) $ (12.53)
The accompanying notes are an integral part of these consolidated financial statements.
COOPER-STANDARD HOLDINGS INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(Dollar amounts in thousands)
Year Ended December 31,
2024 2023 2022
Net loss $ (78,130) $ (203,316) $ (217,791)
Other comprehensive income (loss):
Currency translation adjustment (24,227) (214) (18,856)
Benefit plan liabilities adjustment, net of tax 8,798 16,102 5,052
Pension settlement, net of tax 48,190 - -
Fair value change of derivatives, net of tax (4,312) (8,163) 9,433
Other comprehensive income (loss), net of tax 28,449 7,725 (4,371)
Comprehensive loss (49,681) (195,591) (222,162)
Comprehensive (income) loss attributable to noncontrolling interests (832) 1,913 1,991
Comprehensive loss attributable to Cooper-Standard Holdings Inc. $ (50,513) $ (193,678) $ (220,171)
The accompanying notes are an integral part of these consolidated financial statements.
COOPER-STANDARD HOLDINGS INC.
CONSOLIDATED BALANCE SHEETS
(Dollar amounts in thousands except share amounts)
December 31,
2024 2023
Assets
Current assets:
Cash and cash equivalents $ 170,035 $ 154,801
Accounts receivable, net 310,738 380,562
Tooling receivable, net 69,204 80,225
Inventories 142,401 146,846
Prepaid expenses 25,833 28,328
Income tax receivable and refundable credits 11,576 11,225
Value added tax receivable 45,120 69,684
Other current assets 30,349 28,915
Total current assets 805,256 900,586
Property, plant and equipment, net 539,201 608,431
Operating lease right-of-use assets, net 87,292 91,126
Goodwill 140,443 140,814
Intangible assets, net 33,805 40,568
Deferred tax assets 63,240 23,792
Other assets 63,828 66,982
Total assets $ 1,733,065 $ 1,872,299
Liabilities and Equity
Current liabilities:
Debt payable within one year $ 42,428 $ 50,712
Accounts payable 295,178 334,578
Payroll liabilities 103,701 132,422
Accrued liabilities 116,617 116,954
Current operating lease liabilities 18,859 18,577
Total current liabilities 576,783 653,243
Long-term debt 1,057,839 1,044,736
Pension benefits 89,253 100,578
Postretirement benefits other than pensions 26,336 28,940
Long-term operating lease liabilities 71,907 76,482
Deferred tax liabilities 3,801 5,208
Other liabilities 40,516 52,845
Total liabilities 1,866,435 1,962,032
Preferred stock, $0.001 par value, 10,000,000 shares authorized; no shares issued and outstanding - -
Equity:
Common stock, $0.001 par value, 190,000,000 shares authorized; 19,392,340 shares issued and 17,326,531 outstanding as of December 31, 2024, and 19,263,288 shares issued and 17,197,479 outstanding as of December 31, 2023 17 17
Additional paid-in capital 518,208 512,164
Retained deficit (470,562) (391,816)
Accumulated other comprehensive loss (173,432) (201,665)
Total Cooper-Standard Holdings Inc. equity (125,769) (81,300)
Noncontrolling interests (7,601) (8,433)
Total equity (133,370) (89,733)
Total liabilities and equity $ 1,733,065 $ 1,872,299
The accompanying notes are an integral part of these consolidated financial statements.
COOPER-STANDARD HOLDINGS INC.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(Dollar amounts in thousands except share amounts)
Total Equity
Common Shares Common Stock Additional Paid-In Capital Retained Earnings (Deficit) Accumulated Other Comprehensive Loss Cooper-Standard Holdings Inc. Equity Noncontrolling Interests Total Equity
Balance as of December 31, 2021 16,991,979 $ 17 $ 504,497 $ 25,553 $ (205,184) $ 324,883 $ 6,477 $ 331,360
Share-based compensation, net 116,050 - 3,001 - - 3,001 - 3,001
Deconsolidation of noncontrolling interest - - - - - - (11,007) (11,007)
Net loss for 2022 - - - (215,384) - (215,384) (2,407) (217,791)
Other comprehensive (loss) income - - - - (4,787) (4,787) 416 (4,371)
Balance as of December 31, 2022 17,108,029 $ 17 $ 507,498 $ (189,831) $ (209,971) $ 107,713 $ (6,521) $ 101,192
Share-based compensation, net 89,450 - 4,666 - - 4,666 - 4,666
Net loss for 2023 - - - (201,985) - (201,985) (1,331) (203,316)
Other comprehensive income (loss) - - - - 8,306 8,306 (581) 7,725
Balance as of December 31, 2023 17,197,479 $ 17 $ 512,164 $ (391,816) $ (201,665) $ (81,300) $ (8,433) $ (89,733)
Share-based compensation, net 129,052 - 6,044 - - 6,044 - 6,044
Net (loss) income for 2024 - - - (78,746) - (78,746) 616 (78,130)
Other comprehensive income - - - - 28,233 28,233 216 28,449
Balance as of December 31, 2024 17,326,531 $ 17 $ 518,208 $ (470,562) $ (173,432) $ (125,769) $ (7,601) $ (133,370)
The accompanying notes are an integral part of these consolidated financial statements.
COOPER-STANDARD HOLDINGS INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollar amounts in thousands)
Year Ended December 31,
2024 2023 2022
Operating activities:
Net loss $ (78,130) $ (203,316) $ (217,791)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation 97,053 103,127 115,761
Amortization of intangibles 6,512 6,804 6,715
Gain on sale of businesses, net (1,971) (586) -
Gain on sale of buildings and land, net (3,317) - (33,391)
Impairment charges 713 4,768 43,710
Pension settlement and curtailment charges 44,553 16,035 2,682
Share-based compensation expense 9,161 7,718 3,259
Equity in (earnings) losses of affiliates, net of dividends related to earnings (3,246) (982) 12,450
Loss on refinancing and extinguishment of debt - 81,885 -
Payment-in-kind interest 12,367 58,808 -
Deferred income taxes (45,466) (5,813) 5,653
Other 5,291 4,838 (10,887)
Changes in operating assets and liabilities:
Accounts and tooling receivable 67,761 (12,333) (65,712)
Inventories (3,125) 6,412 (2,221)
Prepaid expenses 1,119 2,924 (5,658)
Income tax receivable and refundable credits (836) 2,603 68,251
Accounts payable (18,440) 6,743 20,591
Payroll and accrued liabilities (19,968) 16,924 46,177
Other 6,338 20,718 (25,739)
Net cash provided by (used in) operating activities 76,369 117,277 (36,150)
Investing activities:
Capital expenditures (50,498) (80,743) (71,150)
Proceeds from sale of businesses, net of cash divested 763 15,351 -
Proceeds from sale of fixed assets 4,328 - 53,288
Other 287 424 (30)
Net cash used in investing activities (45,120) (64,968) (17,892)
Financing activities:
Proceeds from issuance of long-term debt, net of debt issuance costs - 924,299 -
Repayment and refinancing of long-term debt - (927,046) -
Principal payments on long-term debt (2,464) (2,127) (4,178)
(Decrease) increase in short-term debt, net (7,288) (1,234) 4,093
Debt issuance costs and other fees (1,936) (74,376) (4,229)
Taxes withheld and paid on employees' share-based payment awards (612) (214) (607)
Contribution from noncontrolling interests and other 38 (439) 655
Proceeds from other financing activities 2,617 - -
Net cash used in financing activities (9,645) (81,137) (4,266)
Effects of exchange rate changes on cash, cash equivalents and restricted cash (5,968) (918) (13)
Changes in cash, cash equivalents and restricted cash 15,636 (29,746) (58,321)
Cash, cash equivalents and restricted cash at beginning of period 163,061 192,807 251,128
Cash, cash equivalents and restricted cash at end of period $ 178,697 $ 163,061 $ 192,807
Reconciliation of cash, cash equivalents and restricted cash to the consolidated balance sheet:
Cash and cash equivalents $ 170,035 $ 154,801 $ 186,875
Restricted cash included in other current assets 7,590 7,244 4,650
Restricted cash included in other assets 1,072 1,016 1,282
Total cash, cash equivalents and restricted cash shown in the statement of cash flows $ 178,697 $ 163,061 $ 192,807
Supplemental disclosure:
Cash paid for interest $ 101,514 $ 78,699 $ 80,163
Cash paid (received) for income taxes, net of refunds 19,085 10,301 (56,393)
The accompanying notes are an integral part of these consolidated financial statements.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollar amounts in thousands except per share and share amounts)
1. Description of Business
Cooper-Standard Holdings Inc. (together with its consolidated subsidiaries, the “Company” or “Cooper Standard”), through its wholly-owned subsidiary, Cooper-Standard Automotive Inc. (“CSA U.S.”), is a leading manufacturer of sealing and fluid handling systems (consisting of fuel and brake delivery systems and fluid transfer systems). The Company’s products are primarily for use in passenger vehicles and light trucks that are manufactured by global automotive original equipment manufacturers (“OEMs”) and replacement markets. Nearly all of the Company’s activities are conducted through its subsidiaries.
The Company believes it is the largest global producer of sealing systems, the second largest global producer of the types of fuel and brake delivery products that it manufactures and the third largest global producer of the types of fluid transfer systems that it manufactures. The Company designs and manufactures its products in each major region of the world through a disciplined and sustained approach to engineering and operational excellence. The Company operates in 75 manufacturing locations and 49 design, engineering, administrative and logistics locations in 20 countries around the world.
2. Basis of Presentation and Summary of Significant Accounting Policies
Basis of Presentation
The consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”). Certain balances in prior periods have been conformed to the current presentation.
Effective January 1, 2024, the Company changed its management reporting structure with the launch of global product line-focused business segments. This resulted in the realignment of its reportable segments, which are determined based on how the chief operating decision maker (“CODM”) manages the business, allocates resources, makes operating decisions and evaluates operating performance. As a result, the Company established two reportable segments: Sealing Systems and Fluid Handling Systems. All other business activities are reported in Corporate, eliminations and other. The segment realignment had no impact on the Company’s consolidated financial position, results of operations, or cash flows. All segment information included in these consolidated financial statements is reflective of this new structure and prior period information has been revised to conform to the Company’s current period presentation. Refer to Note 21. “Business Segments” for additional information on the Company’s reportable segments and to Note 9. “Goodwill and Intangible Assets” for the impact thereof to the evaluation of recorded goodwill balances.
Summary of Significant Accounting Policies
Principles of Consolidation - The consolidated financial statements include the accounts of the Company and the wholly-owned and, as applicable, less than wholly-owned subsidiaries controlled by the Company. All material intercompany accounts and transactions have been eliminated. Acquired businesses are included in the consolidated financial statements from the dates of acquisition or when the Company gained control.
The equity method of accounting is followed for investments in which the Company does not have control, but does have the ability to exercise significant influence over operating and financial policies. Generally, this occurs when ownership is between 20% to 50%.
Foreign Currency - The financial statements of foreign subsidiaries are translated to United States (“U.S.”) dollars at the end-of-period exchange rates for assets and liabilities and at a weighted average exchange rate for each period for revenues and expenses. Translation adjustments for those subsidiaries whose local currency is their functional currency are recorded as a component of accumulated other comprehensive income (loss) (“AOCI”) in stockholders’ equity. Transaction related gains and losses arising from fluctuations in currency exchange rates on transactions denominated in currencies other than the functional currency are recognized in earnings as incurred, except for those intercompany balances which are designated as long-term-investment nature.
Cash and Cash Equivalents - The Company considers highly liquid investments with an original maturity of three months or less to be cash equivalents, for which the book value approximates fair value.
Accounts Receivable - The Company records trade accounts receivable when revenue is recorded in accordance with its revenue recognition policy and relieves accounts receivable when payments are received from customers. Accounts receivable are written off when it is apparent such amounts are not collectible. Generally, the Company does not require collateral for its accounts receivable, nor is interest charged on accounts receivable balances.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
The Company receives bank notes from certain of its customers, which are classified as other current assets in the consolidated balance sheets, for certain amounts of accounts receivable, primarily in China. The Company may elect to hold such bank notes until maturity, exchange them with suppliers to settle liabilities, or sell them to third-party financial institutions in exchange for cash.
Allowance for Credit Losses - An allowance for credit losses is established through charges to the provision for credit losses when it is probable that the outstanding receivable or reimbursable tooling will not be collected. The Company evaluates the adequacy of the allowance for credit losses on a periodic basis, including historical trends in collections and write-offs, management’s judgment of the probability of collecting accounts and management’s evaluation of business risk. This evaluation is inherently subjective, as it requires estimates that are susceptible to revision as more information becomes available. The allowance for credit losses was $5,437 and $5,944 as of December 31, 2024 and 2023, respectively.
Inventories - Inventories are valued at lower of cost or net realizable value. Cost is determined using the first-in, first-out method. Finished goods and work-in-process inventories include material, labor and manufacturing overhead costs. The Company records inventory reserves for inventory in excess of production and/or forecasted requirements and for obsolete inventory.
December 31,
2024 2023
Finished goods $ 39,299 $ 38,022
Work in process 36,785 38,284
Raw materials and supplies 66,317 70,540
Total $ 142,401 $ 146,846
Derivative Financial Instruments - Derivative financial instruments are utilized by the Company to reduce exposure to foreign currency exchange fluctuations. The Company has established policies and procedures for risk assessment and the approval, reporting and monitoring of derivative financial instrument activities. On the date the derivative is established, the Company designates the derivative as either a fair value hedge, a cash flow hedge or a net investment hedge in accordance with its established policy. Alternatively, under certain circumstances, the Company may choose to leave the derivative undesignated. The Company does not enter into derivative financial instruments for trading or speculative purposes.
Income Taxes - Deferred tax assets or liabilities are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using enacted tax laws and rates. A valuation allowance is provided on deferred tax assets if the Company determines that it is more likely than not that the asset will not be realized.
Long-lived Assets - Property, plant and equipment are recorded at cost and depreciated using primarily the straight-line method over estimated useful lives. Leasehold improvements are amortized over the expected life of the asset or term of the lease, whichever is shorter. Intangibles with finite lives, which include customer relationships, supply agreements and land use rights, are amortized over estimated useful lives. The Company evaluates the recoverability of long-lived assets when events and circumstances indicate that an asset group may be impaired and the undiscounted net cash flows estimated to be generated by those assets are less than their carrying value. If the net carrying value exceeds the fair value, an impairment loss exists and is calculated based on estimated salvage value, estimated orderly liquidation value or a value-in-exchange approach.
Pre-production Costs Related to Long Term Supply Arrangements - Costs for molds, dies and other tools owned by the Company to produce products under long-term supply arrangements are recorded at cost in property, plant and equipment and amortized over the lesser of three years or the term of the related supply agreement. The amounts capitalized were $3,368 and $3,897 as of December 31, 2024 and 2023, respectively. The Company expenses all pre-production tooling costs related to customer-owned tools for which reimbursement is not contractually guaranteed by the customer. Reimbursable tooling costs are recorded in tooling receivable in the consolidated balance sheets if considered to be receivable in the next twelve months, and in other assets if considered to be receivable beyond twelve months. Tooling receivable for customer-owned tooling as of December 31, 2024 and 2023 was $69,204 and $80,225, respectively. Reimbursable tooling costs included in other assets in the accompanying consolidated balance sheets were $18,724 and $16,007 as of December 31, 2024 and 2023, respectively.
Goodwill - The Company tests goodwill for impairment on an annual basis in the fourth quarter, or more frequently if an event occurs or circumstances indicate the carrying amount may be impaired. Goodwill impairment testing is performed at the reporting unit level. The impairment test involves performing a qualitative assessment or using a quantitative test. If we elect to perform a qualitative assessment and determine it is more likely than not that a reporting unit’s carrying value is more than its fair value, a quantitative test is performed by comparing the estimated fair value of each reporting unit to its carrying value. If the carrying value exceeds the fair value, an impairment charge is recorded based on that difference.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
In the fourth quarter of 2024 and 2023, the Company completed a qualitative and quantitative goodwill impairment test, respectively. After evaluating the results, events and circumstances, the Company concluded that sufficient evidence existed to assert that the fair value of its reporting units remained in excess of their carrying values. See Note 9. “Goodwill and Intangible Assets” for additional information.
Business Combinations - The purchase price of an acquired business is allocated to its identifiable assets and liabilities based on estimated fair values. The excess of the purchase price over the amount allocated to the assets and liabilities, if any, is recorded as goodwill. Determining the fair values of assets acquired and liabilities assumed requires management’s judgment, the utilization of independent appraisal firms and often involves the use of significant estimates and assumptions with respect to the timing and amount of future cash flows, market rate assumptions, actuarial assumptions, and appropriate discount rates, among other items.
Revenue Recognition and Sales Commitments - In accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers, revenue is recognized when the performance obligations are satisfied. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account in ASC 606. The Company has one major performance obligation category: manufactured parts.
A contract’s transaction price is allocated to each distinct performance obligation and recognized when the performance obligation is satisfied. The Company’s contracts may include multiple performance obligations. In such cases, the Company typically allocates the contract’s transaction price to each performance obligation based on the purchase order or other arranged pricing.
Revenue is recognized for manufactured parts at a point in time, generally when products are shipped or delivered. The point at which revenue is recognized often depends on the shipping terms.
The Company usually enters into agreements with customers to produce products at the beginning of a vehicle’s life. Blanket purchase orders received from customers and related documents generally establish the annual terms, including pricing, related to a vehicle model. Although purchase orders do not usually specify quantities, fulfillment of customers’ purchasing requirements can be the Company’s obligation for the entire production life of the vehicle. These agreements generally may be terminated by the customer at any time, but such cancellations have historically been minimal. Customers typically pay for parts based on customary business practices with payment terms generally between 30 and 90 days. The Company has no significant financing arrangements with customers.
The Company applies the optional exemption to forgo disclosing information about its remaining performance obligations because its contracts usually have an original expected duration of one year or less. It also applies an accounting policy to treat shipping and handling costs that are incurred after revenue is recognizable as a fulfillment activity by expensing such costs as incurred, instead of as a separate performance obligation. Amounts billed to customers related to shipping and handling are included in sales in the Company’s consolidated statements of operations. Shipping and handling costs are included in cost of products sold in the Company’s consolidated statements of operations.
Research and Development - Engineering, research and development, and program management costs are charged to selling, administration and engineering expenses as incurred and totaled $82,818, $84,112 and $80,528 for the years ended December 31, 2024, 2023 and 2022, respectively.
Share-based Compensation - The Company measures share-based compensation expense at fair value and generally recognizes such expenses on a straight-line basis over the vesting period of the share-based employee awards. See Note 19. “Share-Based Compensation” for additional information.
Use of Estimates - The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and judgments that affect amounts reflected in the consolidated financial statements, as well as disclosure of contingent assets and liabilities. Considerable judgment is often involved in making such estimates, and the use of different assumptions could result in different conclusions. Management believes its assumptions and estimates are reasonable and appropriate. However, actual results could differ from those estimates.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
3. New Accounting Pronouncements
Recently Adopted Accounting Pronouncements
The Company adopted the following Accounting Standards Updates (“ASU”) in 2024, which did not have a material impact on its consolidated financial statements:
Standard Description Effective Date
ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures
Requires disclosure of significant segment expenses that are regularly provided to the CODM and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items to reconcile to segment profit or loss, and the title and position of the entity’s CODM beginning with this Annual Report on Form 10-K. See Note 21. “Business Segments” for required disclosures. The amendments in this update also require certain annual segment disclosures to be included in interim periods beginning in 2025.
January 1, 2024
Recently Issued Accounting Pronouncements
The Company considered the recently issued accounting pronouncements summarized as follows, which could have a material impact on its consolidated financial statements or disclosures:
Standard Description Impact Effective Date
ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures
Requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. The Company is currently evaluating the impact of this update on its consolidated financial statements and disclosures. January 1, 2025
ASU 2023-05, Business Combinations - Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement
Requires joint ventures to apply a new basis of accounting upon formation, and as a result, initially measure all assets and liabilities at fair value (with exceptions to fair value measurement that are consistent with the business combinations guidance). The Company is currently evaluating the impact of this update on its consolidated financial statements and disclosures. January 1, 2025
ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses
Requires disclosure of specified information about certain expenses presented in the statements of operations within the notes to financial statements at each interim and annual reporting period. It also requires disclosure of the total amount of selling expenses and, in annual reporting periods, an entity’s definition of selling expenses. The Company is currently evaluating the impact of this update on its consolidated financial statements and disclosures. January 1, 2027
ASU 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date
Amends the effective date of ASU 2024-03 to clarify that all public business entities are required to adopt the guidance in annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. The Company is currently evaluating the impact of this update on its consolidated financial statements and disclosures. January 1, 2027
4. Divestitures and Deconsolidation
2024 Divestiture
In the fourth quarter of 2024, the Company completed the sale of its Canadian tooling business. Under the terms of the agreement, an initial cash payment of $2,500 was received in the first quarter of 2025, with an additional $2,000 to be received contingent upon the Company issuing a set value of purchase orders with the buyer over a specified period.
During the year ended December 31, 2024, the Company recorded a net gain of $1,971 associated with the sale, included in the consolidated statements of operations.
2023 Divestiture
In the second quarter of 2023, the Company signed a share purchase and assignment agreement to sell its European technical rubber products business. In the third quarter of 2023, the Company closed the transaction and received cash proceeds
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
in the amount of $15,009. In the fourth quarter of 2023, the Company finalized computations of purchase price adjustments. Incremental proceeds of $663 resulting from final net purchase price adjustments were received in the first quarter of 2024.
Upon finalization of the sale, during the year ended December 31, 2023, the Company recorded a net gain of $477, included in the consolidated statements of operations. The net gain included the write off of goodwill of $1,300.
2023 Joint Venture Divestiture
Management approved a plan to sell the Company’s entire controlling equity interest of a joint venture in the Asia Pacific region, and the sale was completed in the third quarter of 2023. Upon meeting the criteria for held for sale classification, the Company recorded non-cash impairment charges of $787 to reduce the carrying value of the held for sale entity to fair value less costs to sell. Fair value, which is categorized within Level 3 of the fair value hierarchy, was determined using a market approach, estimated based on expected proceeds. The fair value less costs to sell were assessed each reporting period that the asset group remained classified as held for sale.
On completion of the sale, during the year ended December 31, 2023, the Company recorded a gain of $109. Both the non-cash impairment charges and gain on sale were included in the consolidated statements of operations.
2022 Joint Venture Deconsolidation
In the first quarter of 2022, a joint venture in the Asia Pacific region that was previously consolidated with a noncontrolling interest amended the governing document underlying the joint venture. The amendment to the agreement did not change the Company’s 51% ownership. However, as a result of the amendment and effective as of January 1, 2022, the joint venture was deconsolidated and accounted for as an investment under the equity method. The Company remeasured the retained investment using the income approach method and performed a discounted cash flow analysis of the projected free cash flows of the joint venture.
As a result of the deconsolidation, during the year ended December 31, 2022, the Company recorded a loss of $2,257, included in other expense, net in the consolidated statements of operations.
5. Revenue
The passenger and light duty group consists of sales to automotive OEMs and automotive suppliers, while the commercial group represents sales to OEMs of on- and off-highway commercial equipment and vehicles. The other customer group includes sales related to specialty and adjacent markets.
Consistent with the Company’s change in reportable segments as described in Note 2. “Basis of Presentation and Summary of Significant Accounting Policies”, the Company has revised its revenue disaggregation presentation to align with the new reportable segment structure.
Revenue by customer group for the year ended December 31, 2024 was as follows:
Sealing Systems Fluid Handling Systems Other Consolidated
Passenger and Light Duty $ 1,386,893 $ 1,212,444 $ - $ 2,599,337
Commercial 30,909 10,720 7,891 49,520
Other 2,232 13,673 66,131 82,036
Total $ 1,420,034 $ 1,236,837 $ 74,022 $ 2,730,893
Revenue by customer group for the year ended December 31, 2023 was as follows:
Sealing Systems Fluid Handling Systems Other Consolidated
Passenger and Light Duty $ 1,414,502 $ 1,237,300 $ 2,650 $ 2,654,452
Commercial 28,750 12,447 7,742 48,939
Other 1,245 15,206 96,037 112,488
Total $ 1,444,497 $ 1,264,953 $ 106,429 $ 2,815,879
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
Revenue by customer group for the year ended December 31, 2022 was as follows:
Sealing Systems Fluid Handling Systems Other Consolidated
Passenger and Light Duty $ 1,248,105 $ 1,082,383 $ 3,050 $ 2,333,538
Commercial 25,966 11,570 7,767 45,303
Other 629 15,468 130,453 146,550
Total $ 1,274,700 $ 1,109,421 $ 141,270 $ 2,525,391
Substantially all the Company’s revenues are generated from sealing and fluid handling systems (consisting of fuel and brake delivery systems and fluid transfer systems) for use in passenger vehicles and light trucks manufactured by global OEMs.
A summary of the Company’s products is as follows:
Product Line Description
Sealing Systems Protect vehicle interiors from weather, dust and noise intrusion for improved driving experience; provide aesthetic and functional class-A exterior surface treatment.
Fluid Handling Systems Fuel & Brake Delivery Systems - Sense, deliver and control fluid and fluid vapors for fuel and brake systems.
Fluid Transfer Systems - Sense, deliver, connect and control fluid delivery for optimal thermal management, powertrain & HVAC operation
Revenue by geographical region for the year ended December 31, 2024 was as follows:
Sealing Systems Fluid Handling Systems Other Consolidated
North America $ 611,761 $ 916,005 $ - $ 1,527,766
Europe 461,798 125,390 - 587,188
Asia Pacific 254,446 161,389 - 415,835
South America 92,029 34,053 - 126,082
Corporate, eliminations and other - - 74,022 74,022
Total $ 1,420,034 $ 1,236,837 $ 74,022 $ 2,730,893
Revenue by geographical region for the year ended December 31, 2023 was as follows:
Sealing Systems Fluid Handling Systems Other Consolidated
North America $ 551,293 $ 934,797 $ - $ 1,486,090
Europe 515,199 133,056 - 648,255
Asia Pacific 284,416 165,060 - 449,476
South America 93,589 32,040 - 125,629
Corporate, eliminations and other - - 106,429 106,429
Total $ 1,444,497 $ 1,264,953 $ 106,429 $ 2,815,879
Revenue by geographical region for the year ended December 31, 2022 was as follows:
Sealing Systems Fluid Handling Systems Other Consolidated
North America $ 515,720 $ 824,876 $ - $ 1,340,596
Europe 405,734 97,932 - 503,666
Asia Pacific 275,800 163,640 - 439,440
South America 77,446 22,973 - 100,419
Corporate, eliminations and other - - 141,270 141,270
Total $ 1,274,700 $ 1,109,421 $ 141,270 $ 2,525,391
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
Contract Estimates
The amount of revenue recognized is usually based on the purchase order price and adjusted for variable consideration, including pricing concessions. The Company accrues for pricing concessions by reducing revenue as products are shipped or delivered. The accruals are based on historical experience, anticipated performance and management’s best judgment. The Company also generally has ongoing adjustments to customer pricing arrangements based on the content and cost of its products. Such pricing accruals are adjusted as they are settled with customers. Customer returns, which are infrequent, are usually related to quality or shipment issues and are recorded as a reduction of revenue. The Company generally does not recognize significant return obligations due to their infrequent nature.
Contract Balances
The Company’s contract assets consist of unbilled amounts associated with variable pricing arrangements in the Asia Pacific region. Once pricing is finalized, contract assets are transferred to accounts receivable. As a result, the timing of revenue recognition and billings, as well as changes in foreign exchange rates, will impact contract assets on an ongoing basis. Contract assets were not materially impacted by any other factors during the year ended December 31, 2024.
The Company’s contract liabilities consist of advance payments received and due from customers. As of December 31, 2024 and 2023, there were no significant contract assets or liabilities recorded.
Other
The Company, at times, enters into agreements that provide for lump sum payments to customers. These payment agreements are recorded as a reduction of revenue during the period the commitment is made, unless the payment is contractually recoverable. Amounts related to commitments of future payments to customers on the consolidated balance sheets as of December 31, 2024 and December 31, 2023, were current liabilities of $9,918 and $10,164, respectively, and long-term liabilities of $1,597 and $4,293, respectively.
The Company provides assurance-type warranties to its customers. Such warranties provide customers with assurance that the related product will function as intended and complies with any agreed-upon specifications, and are recognized in cost of products sold.
6. Restructuring
On an ongoing basis, the Company evaluates its business and objectives to ensure that it is properly configured and sized based on changing market conditions. Accordingly, the Company has implemented several restructuring initiatives, including closure or consolidation of facilities throughout the world and the reorganization of its operating structure.
In May 2024, the Board of Directors of the Company approved a restructuring plan that will eliminate up to 400 salaried, contract and open positions based on the Company’s new product line organizational structure and current and anticipated market demands. The restructuring effort aims to further improve and maximize the Company’s operational efficiency by streamlining business practices and deployed resources, and improving the organization’s overall cost structure.
During the year ended December 31, 2024, the Company recognized total restructuring expenses of $23,601, of which $17,000 was related to the restructuring plan approved in May 2024. The Company estimates total expenses associated with this restructuring plan will range between $17,000 to $18,000, with the majority of these expenses recognized in 2024. Cash expenditures include severance and other related costs directly attributable to the restructuring plan, which were paid in 2024 and will continue to be paid in 2025. Upon completion, the restructuring activities are anticipated to generate annualized savings of approximately $40,000 to $45,000.
The Company’s restructuring charges consist of severance, retention and outplacement services, and severance-related postemployment benefits (collectively, “employee separation costs”), along with other related exit costs and asset impairments related to restructuring activities (collectively, “other exit costs”). Employee separation costs are recorded based on existing union and employee contracts, statutory requirements, completed negotiations and Company policy.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
Restructuring charges by segment for the years ended December 31, 2024, 2023 and 2022 were as follows:
Year Ended December 31,
2024 2023 2022
Sealing Systems $ 16,144 $ 8,802 $ 8,594
Fluid Handling Systems 2,841 6,663 4,069
Corporate and other 4,616 2,553 5,641
Total $ 23,601 $ 18,018 $ 18,304
Restructuring activity for all restructuring initiatives for the years ended December 31, 2024 and 2023 was as follows:
Employee Separation Costs Other Exit Costs Total
Balance as of December 31, 2022 $ 13,185 $ 6,383 $ 19,568
Expense 13,946 4,072 18,018
Cash payments (8,677) (5,201) (13,878)
Foreign exchange translation and other 506 79 585
Balance as of December 31, 2023 $ 18,960 $ 5,333 $ 24,293
Expense 21,596 2,005 23,601
Cash payments (23,728) (2,755) (26,483)
Foreign exchange translation and other (1,771) 362 (1,409)
Balance as of December 31, 2024 $ 15,057 $ 4,945 $ 20,002
Restructuring expense for the year ended December 31, 2024 primarily consisted of employee separation costs related to workforce reduction initiatives aimed at optimizing the Company’s cost structure. Other exit costs for the year ended December 31, 2024 included expenses associated with the closure of certain plants in the European and North American regions.
Restructuring expense for the year ended December 31, 2023 primarily consisted of employee separation costs related to workforce reduction initiatives aimed at optimizing the Company’s cost structure. Other exit costs for the year ended December 31, 2023 include expenses associated with the closure of certain plants in the Asia Pacific, European, and North American regions.
7. Leases
The Company has operating and finance leases for certain manufacturing facilities, corporate offices and certain equipment. Operating leases are included in operating lease right-of-use assets, net, current operating lease liabilities and long-term operating lease liabilities on the Company’s consolidated balance sheets. Finance leases are included in property, plant and equipment, net, debt payable within one year, and long-term debt on the Company’s consolidated balance sheets.
Lease right-of-use assets are recognized at commencement date based upon the present value of the remaining future lease payments over the lease term. The Company’s lease terms include options to renew or terminate the lease when it is reasonably certain that the Company will exercise the option. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based upon information available at the lease commencement date to determine the present value of the remaining future lease payments.
The Company has lease agreements with lease and non-lease components. For real estate leases, these components are accounted for separately, while for equipment leases, the lease and non-lease components are accounted for as a single lease component.
Variable lease expense includes payments based upon changes in a rate or index, such as consumer price indexes, as well as usage of the leased asset. Short-term lease expense includes leases with terms, at lease commencement, of 12 months or less and no purchase option reasonably certain to be exercised. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
The components of lease expense were as follows:
Year Ended December 31,
2024 2023 2022
Operating lease expense $ 27,220 $ 28,128 $ 28,273
Short-term lease expense 5,585 5,037 4,948
Variable lease expense 2,817 2,310 1,136
Finance lease expense:
Amortization of right-of-use assets 2,291 2,216 2,017
Interest on lease liabilities 1,152 1,292 1,316
Total lease expense $ 39,065 $ 38,983 $ 37,690
The Company recorded sublease income of $2,017, $1,213 and $669 for the years ended December 31, 2024, 2023 and 2022, respectively.
Other information related to leases was as follows:
Year Ended December 31,
2024 2023 2022
Supplemental Cash Flows Information
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases $ 27,611 $ 28,432 $ 28,603
Operating cash flows for finance leases 1,156 1,292 1,316
Financing cash flows for finance leases 2,527 2,247 1,958
Non-cash right-of-use assets obtained in exchange for lease obligations:
Operating leases 10,201 8,653 14,326
Finance leases - 540 595
Weighted Average Remaining Lease Term (in years)
Operating leases 6.7 7.3 7.1
Finance leases 7.2 7.9 8.7
Weighted Average Discount Rate
Operating leases 7.2 % 6.7 % 6.1 %
Finance leases 6.0 % 6.0 % 5.9 %
Future lease payments under non-cancellable leases as of December 31, 2024 were as follows:
Year Operating Leases Finance Leases
2025 $ 24,467 $ 3,649
2026 18,630 3,204
2027 14,365 3,129
2028 13,130 2,719
2029 9,945 3,915
Thereafter 32,335 6,961
Total future lease payments $ 112,872 $ 23,577
Less: imputed interest (22,106) (4,621)
Total $ 90,766 $ 18,956
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
Amounts recognized on the consolidated balance sheets as of December 31, 2024 and December 31, 2023 were as follows:
December 31, 2024 December 31, 2023
Operating Leases
Operating lease right-of-use assets, net $ 87,292 $ 91,126
Current operating lease liabilities 18,859 18,577
Long-term operating lease liabilities 71,907 76,482
Finance Leases
Property, plant and equipment, net $ 18,241 $ 21,239
Debt payable within one year 2,655 2,492
Long-term debt 16,301 19,751
As of December 31, 2024, the Company had additional leases, primarily for real estate, that have not yet commenced with undiscounted lease payments of approximately $4,011. These leases will commence in 2025 with lease terms up to six years.
8. Property, Plant and Equipment
Property, plant and equipment consists of the following:
December 31, Estimated
2024 2023 Useful Lives
Land and improvements $ 41,945 $ 43,950 10 to 25 years
Buildings and improvements 256,606 270,890 10 to 40 years
Machinery and equipment 1,187,476 1,191,792 5 to 10 years
Construction in progress 60,142 71,706
$ 1,546,169 $ 1,578,338
Accumulated depreciation (1,006,968) (969,907)
Property, plant and equipment, net $ 539,201 $ 608,431
For the year ended December 31, 2024, the Company closed on a transaction to sell building and land related to a previously closed Canadian facility. The Company received cash proceeds of $4,003 and recorded a gain on the sale transaction of $3,317, included in the consolidated statements of operations. The transaction included the removal of property, plant and equipment with a gross carrying value of $3,363 and accumulated depreciation of $2,676, which is reflected in the balance sheet as of December 31, 2024.
For the years ended December 31, 2023 and 2022, the Company recorded impairment charges of $2,348 and $40,248, respectively, related to machinery and equipment due to operating performance challenges at certain locations in North America, Europe, and Asia Pacific. The fair value of machinery and equipment was determined using estimated orderly liquidation value, which was deemed the highest and best use of the assets. Meanwhile, the fair value of real estate assets was determined using a value-in-exchange approach, which indicated that their fair value exceeded their carrying value.
For the years ended December 31, 2024, 2023 and 2022, the Company also recorded impairment charges of $713, $1,633 and $3,462, respectively, due to idle assets in certain locations in North America, Europe, and Asia Pacific. The fair value was determined using estimated salvage value, which was deemed the highest and best use of the assets.
For the year ended December 31, 2022, the Company closed on a sale-leaseback transaction related to one of its European facilities and recorded a gain on the sale transaction of $33,391.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
Asset impairment charges by segment for the years ended December 31, 2024, 2023 and 2022 were as follows:
Year Ended December 31,
2024 2023 2022
Sealing Systems $ 531 $ 164 $ 30,604
Fluid Handling Systems 130 2,567 12,888
Corporate and other 52 1,250 218
Total (1)
$ 713 $ 3,981 $ 43,710
(1) Excludes $787 of non-cash impairment charges for the year ended December 31, 2023 associated with a joint venture in the Asia Pacific region as disclosed in Note 4. “Divestitures and Deconsolidation”.
9. Goodwill and Intangible Assets
Goodwill
As further described in Note 21. “Business Segments”, effective January 1, 2024, the Company changed its management reporting structure with the launch of global product line-focused business segments. Based on this change, the Company established two reportable segments: Sealing Systems and Fluid Handling Systems. The two reportable segments, along with the Industrial Specialty Group business, are the applicable reporting units for purposes of goodwill assignment and evaluation.
As a result of the segment realignment, the Company allocated goodwill to the reporting units existing under the new organizational structure on a relative fair value basis. The Company estimated the fair values of the reporting units based upon the present value of their anticipated future cash flows. The Company’s determination of fair value involved judgment and the use of estimates and assumptions. In conjunction with the goodwill allocation, the Company performed a quantitative impairment assessment of goodwill immediately before and after the segment realignment. The quantitative analyses did not result in any impairment charges as the fair value of each reporting unit exceeded its respective carrying value.
Changes in the carrying amount of goodwill by reporting unit for the years ended December 31, 2024 and 2023 were as follows:
Sealing Systems Fluid Handling Systems Industrial Specialty Group Total
Balance as of December 31, 2022 $ 47,684 $ 80,303 $ 14,036 $ 142,023
Divestiture - - (1,300) (1,300)
Foreign exchange translation 91 - - 91
Balance as of December 31, 2023 47,775 80,303 12,736 140,814
Foreign exchange translation (371) - - (371)
Balance as of December 31, 2024 $ 47,404 $ 80,303 $ 12,736 $ 140,443
The Company performed its annual goodwill impairment during the fourth quarters of 2024, 2023 and 2022. In the fourth quarter of 2024, the Company performed a qualitative assessment, which was partly informed by quantitative valuations of each reporting unit conducted as of January 1, 2024, following a change to Company’s management reporting restructure. Based on this assessment, the Company concluded that it is more likely than not that the fair value of each reporting unit exceeds its carrying amount, and therefore, no goodwill impairment was required for the year ended December 31, 2024.
During the fourth quarters of 2023 and 2022, the Company performed quantitative goodwill impairment tests. The fair value of each reporting unit was determined and compared to its carrying value. If the carrying value had exceeded the fair value, an impairment charge would have been recorded for the difference. The results of the annual quantitative impairment analyses indicated that the fair value of all reporting units exceeded their carrying values, resulting in no goodwill impairment for both 2023 and 2022.
The write off of goodwill of $1,300 during the year ended December 31, 2023 is related to the sale of the European technical rubber products business. Refer to Note. 4 “Divestitures and Deconsolidations” for additional information.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
Intangible Assets
Definite-lived intangible assets and accumulated amortization balances as of December 31, 2024 and 2023 were as follows:
Gross Carrying Amount Accumulated Amortization Net Carrying Amount
Customer relationships $ 152,054 $ (137,654) $ 14,400
Other 37,737 (18,332) 19,405
Balance as of December 31, 2024 $ 189,791 $ (155,986) $ 33,805
Customer relationships $ 152,403 $ (133,698) $ 18,705
Other 38,090 (16,227) 21,863
Balance as of December 31, 2023 $ 190,493 $ (149,925) $ 40,568
Estimated amortization expense for the next five years is shown in the table below:
Year Expense
2025 $ 6,518
2026 4,722
2027 4,711
2028 4,062
2029 3,128
10. Debt and Other Financing
A summary of outstanding debt as of December 31, 2024 and 2023 was as follows:
December 31,
2024 2023
First Lien Notes $ 610,955 $ 595,966
Third Lien Notes 388,169 386,681
2026 Senior Notes 42,415 42,338
Finance leases 18,956 22,243
Other borrowings 39,772 48,220
Total debt 1,100,267 1,095,448
Less: current portion (42,428) (50,712)
Total long-term debt $ 1,057,839 $ 1,044,736
The principal maturities of debt, at nominal value, as of December 31, 2024 are as follows:
Year Debt and Finance Lease Obligations*
2025 $ 43,422
2026 45,758
2027 1,011,750
2028 2,719
2029 3,915
Thereafter 6,961
Total $ 1,114,525
* Inclusive of imputed interest on finance leases.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
The weighted average interest rate of our debt payable within one year was 3.4% as of December 31, 2024 and 3.7% as of December 31, 2023.
First Lien Notes
On January 27, 2023, the Company issued $580,000 aggregate principal amount of its 13.50% Cash Pay / PIK Toggle Senior Secured First Lien Notes due 2027 (the “First Lien Notes”). The First Lien Notes mature on March 31, 2027 and bear interest at the rate of 13.50% per annum, which is payable in cash semi-annually on June 15 and December 15 of each year. Interest payments commenced on June 15, 2023. However, for the first four interest periods the Company has the option, in its sole discretion, to pay up to 4.50% of such interest by increasing the principal amount of the outstanding First Lien Notes or, in limited circumstances, by issuing additional First Lien Notes. As of December 31, 2024 and December 31, 2023, the outstanding aggregate amount of the First Lien Notes of $610,955 and $595,966, respectively, recognized in the consolidated balance sheets reflect the election to pay 4.50% of the first three interest payments as payment-in-kind. The Company elected to pay the fourth interest payment on the First Lien Notes due December 15, 2024 in cash.
As of December 31, 2024 and December 31, 2023, the Company had $5,666 and $8,184, respectively, of unamortized debt issuance costs, and $233 and $337, respectively, of unamortized original issue discount related to the First Lien Notes, which are presented as direct deductions from the principal balance in the consolidated balance sheets. Both the debt issuance costs and the original issue discount are amortized into interest expense over the term of the First Lien Notes.
Third Lien Notes
On January 27, 2023, the Company issued $357,446 aggregate principal amount of its 5.625% Cash Pay / 10.625% PIK Toggle Senior Secured Third Lien Notes due 2027 (the “Third Lien Notes”). The Third Lien Notes mature on May 15, 2027 and bear interest at the rate of 5.625% per annum, which is payable in cash semi-annually on June 15 and December 15 of each year. Interest payments commenced on June 15, 2023. However, for the first four interest periods the Company has the option, in its sole discretion, to pay such interest at 10.625% per annum either by increasing the principal amount of the outstanding Third Lien Notes or, in limited circumstances, by issuing additional Third Lien Notes. As of December 31, 2024 and December 31, 2023, the outstanding aggregate amount of the Third Lien Notes of $388,169 and $386,681, respectively, recognized in the consolidated balance sheets reflect the election to fully pay the first two interest payments as payment-in-kind. The Company elected to pay the third and fourth interest payments on the Third Lien Notes due June 15, 2024 and December 15, 2024, respectively, in cash.
Debt issuance costs related to the Third Lien Notes are amortized into interest expense over the term of the Third Lien Notes. As of December 31, 2024 and December 31, 2023, the Company had $3,598 and $5,087, respectively, of unamortized debt issuance costs related to the Third Lien Notes, which are presented as a direct deduction from the principal balance in the consolidated balance sheets.
2026 Senior Notes
On November 2, 2016, the Company issued $400,000 aggregate principal amount of its 5.625% Senior Notes due 2026 (the “2026 Senior Notes”). As part of certain refinancing transactions that were completed on January 27, 2023, the Company exchanged $357,446 aggregate principal amount of its 2026 Senior Notes for $357,446 aggregate principal amount of its newly issued Third Lien Notes. Following the completion of the exchange, $42,554 aggregate principal amount of the 2026 Senior Notes remained outstanding. As of December 31, 2024 and December 31, 2023, the outstanding aggregate amount of the 2026 Senior Notes recognized in the consolidated balance sheets is $42,415 and $42,338, respectively. The 2026 Senior Notes mature on November 15, 2026 and bear interest at the rate of 5.625% per annum, which is payable in cash semi-annually on May 15 and November 15 of each year.
Debt issuance costs are being amortized into interest expense over the term of the 2026 Senior Notes. As of December 31, 2024 and December 31, 2023, the Company had $139 and $216, respectively, of unamortized debt issuance costs related to the 2026 Senior Notes, which is presented as a direct deduction from the principal balance in the consolidated balance sheets.
ABL Facility
On November 2, 2016, the Company entered into a third amendment and restatement of the ABL Facility. In March 2020, the Company entered into Amendment No. 1 to the Third Amended and Restated Loan Agreement (“the First Amendment”). As a result of the First Amendment, the ABL Facility maturity was extended to March 2025 and the aggregate revolving loan commitment was reduced to $180,000. In May 2020, the Company entered into Amendment No. 2 to the Third Amended and Restated Loan Agreement (the “Second Amendment”), which modified certain covenants under the ABL Facility.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
In December 2022, the Company entered into Amendment No. 3 to the Third Amended and Restated Loan Agreement (the “Third Amendment”), which became effective on January 27, 2023. In May 2024, the Company entered into Amendment No. 4 to the Third Amended and Restated Loan Agreement (the “Fourth Amendment”), which, among other things, (1) extended the termination date for revolving commitments totaling $150,000 from March 24, 2025 ( “Existing Termination Date”) to May 6, 2029; (2) provided for leverage-based interest rate margin and commitment fee step-downs; and (3) replaced the Canadian BA Rate with Term CORRA as the applicable benchmark rate for all purposes under the ABL Facility for revolving loans denominated in Canadian Dollars. In September 2024, the Company entered into an agreement to transfer and assign revolving commitments totaling $35,000 from certain existing ABL Facility lenders to new ABL Facility lenders. As part of this agreement, the termination date for all outstanding revolving commitments that had not been previously extended was extended from the Existing Termination Date to May 6, 2029.
The aggregate revolving loan availability includes a $100,000 letter of credit sub-facility and a $25,000 swing line sub-facility. The ABL Facility also provides for an uncommitted $100,000 incremental loan facility, for a potential total ABL Facility of $280,000 (if requested by the Borrowers and the lenders agree to fund such increase). No consent of any lender (other than those participating in the increase) is required to effect any such increase, subject to receiving any required consents under the Company’s other debt documents which contain restrictions on incremental debt. The Company’s borrowing base as of December 31, 2024 was $176,722 and the monthly fixed charge coverage ratio was at a level that provided the Company full access to the borrowing base. Net of $7,551 of outstanding letters of credit, the Company effectively had $169,171 available for borrowing under its ABL Facility as of December 31, 2024.
As of December 31, 2024 and December 31, 2023, there were no borrowings under the ABL Facility.
As of December 31, 2024 and December 31, 2023, the Company had $1,680 and $862, respectively, of unamortized debt issuance costs related to the ABL Facility recorded in other long-term assets in the consolidated balance sheets.
Debt Covenants
The Company was in compliance with all applicable covenants of the First Lien Notes, Third Lien Notes, 2026 Senior Notes, and ABL Facility as of December 31, 2024.
Other Financing
Finance leases and other. Other borrowings as of December 31, 2024 and December 31, 2023, reflect finance leases and other borrowings under local bank lines classified in debt payable within one year in the consolidated balance sheets.
Receivables factoring. As a part of its working capital management, the Company sells certain receivables through a single third-party financial institution (the “Factor”) in a pan-European program. The amount sold varies each month based on the amount of underlying receivables and cash flow needs of the Company. These are permitted transactions under the Company’s credit agreements governing the ABL Facility and the indentures governing the First Lien Notes, Third Lien Notes, and 2026 Secured Notes. The European factoring facility allows the Company to factor up to €70,000 of its Euro-denominated accounts receivable, accelerating access to cash and reducing credit risk. The factoring facility expires on December 31, 2026.
Costs incurred on the sale of receivables are recorded in other expense, net in the consolidated statements of operations. The sale of receivables under this contract is considered an off-balance sheet arrangement to the Company and is accounted for as a true sale and is excluded from accounts receivable in the consolidated balance sheets. Amounts outstanding under receivable transfer agreements entered into by various locations as of the period end were as follows:
December 31, 2024 December 31, 2023
Off-balance sheet arrangements $ 53,377 $ 47,903
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
Accounts receivable factored and related costs throughout the period were as follows:
Off-Balance Sheet Arrangements
Year Ended December 31,
2024 2023
Accounts receivable factored $ 497,408 $ 420,119
Off-Balance Sheet Arrangements
Year Ended December 31,
2024 2023 2022
Costs $ 2,904 $ 2,226 $ 710
As of December 31, 2024 and 2023, cash collections on behalf of the Factor that had yet to be remitted were $838 and $6,466, respectively, and are reflected in other current assets as restricted cash in the consolidated balance sheets.
11. Fair Value Measurements and Financial Instruments
Fair Value Measurements
Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based upon assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, a three-tier fair value hierarchy is utilized, which prioritizes the inputs used in measuring fair value as follows:
Level 1: Observable inputs such as quoted prices in active markets;
Level 2: Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and
Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.
Items Measured at Fair Value on a Recurring Basis
Estimates of the fair value of foreign currency derivative instruments are determined using exchange traded prices and rates. The Company also considers the risk of non-performance in the estimation of fair value and includes an adjustment for non-performance risk in the measure of fair value of derivative instruments. In certain instances where market data is not available, the Company uses management judgment to develop assumptions that are used to determine fair value. Fair value measurements and the fair value hierarchy level for the Company’s assets and liabilities measured or disclosed at fair value on a recurring basis as of December 31, 2024 and 2023 were as follows:
December 31, 2024 December 31, 2023 Input
Derivatives designated as hedging instruments:
Forward foreign exchange contracts - other current assets $ 269 $ 1,285 Level 2
Forward foreign exchange contracts - accrued liabilities $ (4,109) $ (998) Level 2
Derivatives not designated as hedging instruments:
Forward foreign exchange contracts - other current assets $ 86 $ - Level 2
Forward foreign exchange contracts - accrued liabilities $ - $ - Level 2
Items Measured at Fair Value on a Nonrecurring Basis
In addition to items that are measured at fair value on a recurring basis, the Company measures certain assets and liabilities at fair value on a nonrecurring basis, which are not included in the table above. As these nonrecurring fair value measurements are generally determined using unobservable inputs, these fair value measurements are classified within Level 3 of the fair value hierarchy. For additional information on assets and liabilities measured at fair value on a nonrecurring basis see Note 2. “Basis of Presentation and Summary of Significant Accounting Policies”, Note 4. “Divestitures and Deconsolidation”, Note 8. “Property, Plant and Equipment”, and Note 9. “Goodwill and Intangible Assets”.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
Items Not Carried at Fair Value
Fair values of the Company’s First Lien Notes, Third Lien Notes, and 2026 Senior Notes were as follows:
December 31, 2024 December 31, 2023
Aggregate fair value $ 1,012,495 $ 984,448
Aggregate carrying value (1)
$ 1,051,175 $ 1,038,808
(1) Excludes unamortized debt issuance costs and unamortized original issue discount.
Fair values were based on quoted market prices and are classified within Level 1 of the fair value hierarchy.
Derivative Instruments and Hedging Activities
The Company is exposed to fluctuations in foreign currency exchange rates, interest rates and commodity prices. The Company enters into derivative instruments primarily to hedge portions of its forecasted foreign currency denominated cash flows and designates these derivative instruments as cash flow hedges in order to qualify for hedge accounting. The Company also enters into derivative instruments to manage exposure related to foreign currency denominated monetary assets and liabilities.
The Company formally documents its hedge relationships, including the identification of the hedging instruments and the hedged items, as well as its risk management objectives and strategies for undertaking various hedge transactions. The Company also formally assesses whether a cash flow hedge is highly effective in offsetting changes in cash flows of the hedged item. Derivatives are recorded at fair value in other current assets, other assets, accrued liabilities and other long-term liabilities.
For a cash flow hedge, the change in fair value of the derivative is recorded in AOCI in the consolidated balance sheets, to the extent that the hedges are effective, and reclassified into earnings when the underlying hedged transaction is realized. The realized gains and losses are recorded on the same line as the hedged transaction in the consolidated statements of operations. Derivatives not designated as hedging instruments are marked-to-market with changes in fair value recorded in earnings. Cash flows from derivatives used to manage foreign exchange risks are classified as operating activities within the consolidated statements of cash flows.
The Company is exposed to credit risk in the event of nonperformance by its counterparties on its derivative financial instruments. The Company mitigates this credit risk exposure by entering into agreements directly with major financial institutions with high credit standards that are expected to fully satisfy their obligations under the contracts.
Cash Flow Hedges
Forward Foreign Exchange Contracts. The Company uses forward contracts to mitigate the potential volatility to earnings and cash flow arising from changes in currency exchange rates that impact the Company’s foreign currency transactions. The principal currencies hedged by the Company include various European currencies, the Canadian Dollar, and the Mexican Peso. As of December 31, 2024 and 2023, the notional amount of these contracts was $188,140 and $207,131, respectively, and consisted of hedges of cash flow transactions extending out to December 2025.
Pretax amounts related to the Company’s cash flow hedges that were recognized in other comprehensive income (loss) (“OCI”) were as follows:
(Loss) Gain Recognized in OCI
Year Ended December 31,
2024 2023
Cash flow hedges $ (8,045) $ 10,202
Pretax amounts related to the Company’s cash flow hedges that were reclassified from AOCI and recognized in cost of products sold were as follows:
(Loss) Gain Reclassified from AOCI to Income
Year Ended December 31,
2024 2023
Cash flow hedges $ (3,919) $ 18,550
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
Derivatives Not Designated as Hedges
Forward Foreign Exchange Contracts. Effective in the third quarter of 2024, the Company began using one-month forward contracts to manage exposure related to foreign currency denominated monetary assets and liabilities. The contracts are not designated as cash flow or fair value hedges under ASC 815, and therefore are marked-to-market with changes in fair value recorded to earnings. The principal currencies hedged by the Company are the Mexican Peso and Brazil Real. As of December 31, 2024, the notional amount outstanding was $16,426. The Company did not have any outstanding non-designated derivatives as of December 31, 2023.
Pretax amounts related to the Company’s non-designated derivatives recognized in other expense, net were as follows:
Gain Recognized in Income
Year Ended December 31,
2024 2023
Non-designated foreign currency contracts $ 690 $ -
12. Pensions
The Company maintains defined benefit pension plans covering certain employees located in the United States as well as certain international locations. The majority of these plans are frozen, and all are closed to new employees. Benefits generally are based on compensation, length of service and age for salaried employees and on length of service for hourly employees. The Company’s policy is to fund pension plans such that sufficient assets will be available to meet future benefit requirements and contribute amounts deductible for United States federal income tax purposes or amounts required by local statute.
Pension Plan Termination
On October 11, 2022, the Company’s Board of Directors approved a resolution to merge certain of the Company’s U.S. defined benefit pension plans and terminate the resulting merged plan (“U.S. Pension Plan”) effective December 31, 2022.
On April 3, 2024, the Company irrevocably transferred approximately $137,000 of remaining pension benefit obligations and associated plan assets related to the U.S. Pension Plan to a highly-rated insurance company, thereby reducing the Company’s pension obligations and assets by the same amount. This transaction further de-risked the Company’s retirement-related plans by eliminating the potential for the Company to make future cash contributions to fund the remaining pension benefit obligations being transferred to the insurer. Beginning in June 2024, the insurance company began paying plan benefits to eligible plan participants through a group annuity contract.
The termination of the U.S. Pension Plan was completed during the year ended December 31, 2024.
For the year ended December 31, 2024, the Company recognized a net one-time, non-cash pension settlement charge of $44,571 ($45,973 net of tax) in the consolidated statements of operations, primarily related to the accelerated recognition of accumulated actuarial losses included within AOCI in the consolidated balance sheets.
For the year ended December 31, 2023, the Company recognized a pension settlement loss of $16,285 in the consolidated statements of operations, due to completing the transfer of all lump sum payments to eligible plan participants who elected such lump sums or otherwise met the criteria for lump sum payments as part of the termination process.
For the year ended December 31, 2022, the Company recognized a pension curtailment loss of $3,092 in the consolidated statements of operations, associated with the termination of the U.S. Pension Plan, primarily due to prior service cost resulting from a 2022 plan amendment impacting the benefits of certain participants in the U.S. Pension Plan.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
Pension Plan Funded Status Reconciliation
Information related to the Company’s defined benefit pension plans was as follows:
Year Ended December 31,
2024 2023
U.S. Non-U.S. U.S. Non-U.S.
Change in projected benefit obligations:
Projected benefit obligations at beginning of period $ 161,813 $ 126,795 $ 212,688 $ 116,653
Service cost - 2,338 - 2,161
Interest cost 2,252 4,774 9,254 5,198
Net actuarial (gain) loss (11,378) (4,753) (112) 5,876
Benefits paid (6,426) (4,687) (11,464) (5,633)
Foreign exchange translation - (9,421) - 4,417
Settlements and curtailments (136,479) (4,686) (48,553) (1,935)
Other - 176 - 58
Projected benefit obligations at end of period $ 9,782 $ 110,536 $ 161,813 $ 126,795
Change in plan assets:
Fair value of plan assets at beginning of period $ 147,457 $ 34,550 $ 196,434 $ 32,811
Actual return on plan assets (5,686) 2,393 10,004 3,013
Employer contributions 1,042 4,711 1,036 5,523
Benefits paid (6,426) (4,687) (11,464) (5,633)
Foreign exchange translation - (2,767) - 771
Settlements and curtailments (136,479) (4,552) (48,553) (1,935)
Other 92 (220) - -
Fair value of plan assets at end of period $ - $ 29,428 $ 147,457 $ 34,550
Funded status of the plans $ (9,782) $ (81,108) $ (14,356) $ (92,245)
The U.S. amounts provided in the table above for projected benefit obligations at end of period, fair value of plan assets at end of period, and funded status of the plans for the year ended December 31, 2024 relate only to the Company’s supplemental employee retirement plan (“SERP”).
December 31, 2024 December 31, 2023
U.S. Non-U.S. U.S. Non-U.S.
Amounts recognized in the consolidated balance sheet:
Other assets $ - $ 3,253 $ - $ 3,039
Accrued liabilities (1,005) (3,885) (4,958) (4,104)
Pension benefits (long term) (8,777) (80,476) (9,398) (91,180)
The U.S. amounts provided in the table above for amounts recognized in the consolidated balance sheet as of December 31, 2024 relate only to the Company’s SERP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
Pre-tax amounts included in accumulated other comprehensive loss that have not yet been recognized in net periodic benefit cost (income) as of December 31, 2024 and 2023 were as follows:
December 31, 2024 December 31, 2023
U.S. Non-U.S. U.S. Non-U.S.
Prior service cost $ - $ (8) $ - $ (11)
Actuarial losses (2,671) (4,836) (53,684) (11,714)
The Company uses the corridor approach when amortizing actuarial gains or losses. Under the corridor approach, net unrecognized actuarial losses in excess of 10% of the greater of i) the projected benefit obligations or ii) the fair value of plan assets for a particular plan are amortized over the average future service period of the employees in that plan.
The accumulated benefit obligations for all domestic and international defined benefit pension plans was $9,782 and $103,186 as of December 31, 2024 and $161,813 and $118,760 as of December 31, 2023, respectively. As of December 31, 2024, the fair value of plan assets for one of the Company’s defined benefit plans exceeded the projected benefit obligations of $15,384 by $3,253.
The components of net periodic benefit cost (income) for the Company’s defined benefit plans were as follows:
Year Ended December 31,
2024 2023 2022
U.S. Non-U.S. U.S. Non-U.S. U.S. Non-U.S.
Service cost $ - $ 2,338 $ - $ 2,161 $ 771 $ 2,755
Interest cost 2,252 4,774 9,254 5,198 7,062 2,782
Expected return on plan assets (1,701) (1,319) (8,451) (1,230) (9,293) (949)
Amortization of prior service cost and actuarial loss 680 211 3,110 24 886 1,574
Settlement loss (gain) 44,571 87 16,285 (248) - (410)
Curtailment (gain) loss - (105) - - 3,092 -
Net periodic benefit cost $ 45,802 $ 5,986 $ 20,198 $ 5,905 $ 2,518 $ 5,752
Plan Assumptions
Weighted average assumptions used to determine benefit obligations as of December 31, 2024 and 2023 were as follows:
December 31, 2024 December 31, 2023
U.S. Non-U.S. U.S. Non-U.S.
Discount rate 5.50% 4.21% 4.70% 4.00%
Rate of compensation increase N/A 3.14% N/A 3.20%
Cash balance interest credit rate N/A N/A 2.41% N/A
Weighted average assumptions used to determine net periodic benefit cost (income) for the years ended December 31, 2024, 2023 and 2022 were as follows:
Year Ended December 31,
2024 2023 2022
U.S. Non-U.S. U.S. Non-U.S. U.S. Non-U.S.
Discount rate 5.10% 4.00% 4.55% 4.45% 2.84% 2.39%
Expected return on plan assets N/A 4.07% 4.50% 3.84% 3.50% 2.15%
Rate of compensation increase N/A 3.20% N/A 3.01% N/A 2.39%
To develop the expected return on plan assets assumption, the Company considered the historical returns and the future expected returns for each asset class, as well as the target asset allocation of the pension portfolio. As the U.S. plans are frozen, the rate of compensation increase was not applicable in determining net periodic benefit cost (income).
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
Plan Assets
The goals and investment objectives of the asset strategy are to ensure that there is an adequate level of assets to meet benefit obligations to participants and retirees over the life of the participants and maintain liquidity in the plan assets sufficient to cover monthly benefit obligations. Risk is managed by investing in a broad range of investment vehicles, e.g., equity mutual funds, bond mutual funds, real estate mutual funds, hedge funds, etc. There are no equity securities of the Company in the equity asset category.
Investments in equity securities and debt securities are valued at fair value using a market approach and observable inputs, such as quoted market prices in active markets (Level 1). Investments in balanced funds are valued at fair value using a market approach and inputs that are primarily directly or indirectly observable (Level 2). Investments in equity securities and balanced funds in which the Company holds participation units in a fund, the net asset value of which is based on the underlying assets and liabilities of the respective fund, are considered an unobservable input (Level 3). Investments in real estate funds are primarily valued at net asset value depending on the investment.
The fair value of the Company’s pension plan assets by category using the three-level hierarchy (see Note 11. “Fair Value Measurements and Financial Instruments”) as of December 31, 2024 and 2023 was as follows:
December 31, 2024 Level 1 Level 2 Total
Equity funds $ - $ 6,597 $ 6,597
Bond funds - 21,216 21,216
Cash and cash equivalents 1,615 - 1,615
Total $ 1,615 $ 27,813 $ 29,428
December 31, 2023 Level 1 Level 2 Assets measured at NAV (1)
Total
Equity funds $ - $ 7,167 $ - $ 7,167
Bond funds - 25,236 - 25,236
Bond funds measured at net asset value - - 123,366 123,366
Real estate measured at net asset value - - 8,121 8,121
Cash and cash equivalents 18,117 - - 18,117
Total $ 18,117 $ 32,403 $ 131,487 $ 182,007
(1) Certain assets that are measured at fair value using the NAV per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. These assets are included in this table to present total pension plan assets at fair value.
There were no transfers of Level 3 assets and no Level 3 assets in the ending balance for the years ended December 31, 2024 and December 31, 2023.
Expected Future Benefit Payments
The Company estimates its benefit payments for domestic and foreign pension plans during the next ten years to be as follows:
Years Ending December 31, U.S. Non-U.S. Total
2025 $ 1,032 $ 5,796 $ 6,828
2026 1,013 6,014 7,027
2027 991 6,597 7,588
2028 966 7,041 8,007
2029 942 7,726 8,668
2030 - 2034 4,212 46,648 50,860
Contributions
The Company does not anticipate making cash contributions to its SERP in 2025, but will make minimum funding cash contributions of approximately $408 to its non-U.S. pension plans in 2025.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
The Company also sponsors voluntary defined contribution plans for certain salaried and hourly U.S. employees of the Company. The Company matches contributions of participants, up to various limits in all plans. The Company also sponsors retirement plans that include Company non-elective contributions. Non-elective and matching contributions under these plans totaled $13,126, $13,919 and $12,015 for the years ended December 31, 2024, 2023 and 2022, respectively.
13. Postretirement Benefits Other Than Pensions
The Company provides certain retiree health care and life insurance benefits covering certain U.S. salaried and hourly employees and employees in Canada. Employees are generally eligible for benefits upon retirement and completion of a specified number of years of creditable service. The Company’s policy is to fund the cost of these postretirement benefits as these benefits become payable.
Information related to the Company’s postretirement benefit plans was as follows:
Year Ended December 31,
2024 2023
U.S. Non-U.S. U.S. Non-U.S.
Change in benefit obligations:
Benefit obligations at beginning of year $ 11,763 $ 17,408 $ 15,812 $ 15,473
Service cost 23 177 52 150
Interest cost 567 763 821 788
Net actuarial (gain) loss (113) (398) (3,759) 1,230
Benefits paid (1,163) (764) (1,163) (748)
Other - - - 107
Foreign currency exchange rate effect - (1,411) - 408
Benefit obligations at end of year $ 11,077 $ 15,775 $ 11,763 $ 17,408
Funded status of the plan $ (11,077) $ (15,775) $ (11,763) $ (17,408)
Net amount recognized as of December 31 $ (11,077) $ (15,775) $ (11,763) $ (17,408)
December 31, 2024 December 31, 2023
U.S. Non-U.S. U.S. Non-U.S.
Amounts recognized in the consolidated balance sheet:
Accrued liabilities $ (1,248) $ (757) $ (1,264) $ (761)
Postretirement benefits other than pension (long term) (9,829) (15,018) (10,499) (16,647)
Pre-tax amounts included in accumulated other comprehensive loss that have not yet been recognized in net periodic benefit cost (income) as of December 31, 2024 and 2023 were as follows:
December 31, 2024 December 31, 2023
U.S. Non-U.S. U.S. Non-U.S.
Prior service cost $ - $ 99 $ - $ (122)
Actuarial gains 13,201 1,335 16,008 1,041
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
The components of net periodic benefit (income) cost for the Company’s other postretirement benefit plans were as follows:
Year Ended December 31,
2024 2023 2022
U.S. Non-U.S. U.S. Non-U.S. U.S. Non-U.S.
Service cost $ 23 $ 177 $ 52 $ 150 $ 89 $ 216
Interest cost 567 763 821 788 561 628
Amortization of prior service credit and actuarial (gain) loss (2,920) 14 (2,437) (85) (1,577) 157
Net periodic benefit (income) cost $ (2,330) $ 954 $ (1,564) $ 853 $ (927) $ 1,001
Plan Assumptions
Weighted average assumptions used to determine benefit obligations as of December 31, 2024 and 2023 were as follows:
2024 2023
U.S. Non-U.S. U.S. Non-U.S.
Discount rate 5.50% 4.70% 5.10% 4.65%
Weighted average assumptions used to determine net periodic benefit cost (income) for the years ended December 31, 2024, 2023 and 2022 were as follows:
2024 2023 2022
U.S. Non-U.S. U.S. Non-U.S. U.S. Non-U.S.
Discount rate 5.10% 4.65% 5.45% 5.20% 2.75% 3.05%
The assumed health care cost trend rates used to measure the postretirement benefit obligations as of December 31, 2024 were as follows:
U.S. Non-U.S.
Health care cost trend rate 6.21% 5.00%
Ultimate health care cost trend rate 4.50% 5.00%
Year that the rate reaches the ultimate trend rate 2031 N/A
Expected Future Postretirement Benefit Payments
The Company estimates its benefit payments for its postretirement benefit plans during the next ten years to be as follows:
Years Ending December 31, U.S. Non-U.S. Total
2025 $ 1,282 $ 775 $ 2,057
2026 1,244 793 2,037
2027 1,190 791 1,981
2028 1,147 792 1,939
2029 1,085 824 1,909
2030 - 2034 4,489 4,389 8,878
Other
Other postretirement benefits recorded in the Company’s consolidated balance sheets include $1,489 and $1,794 as of December 31, 2024 and 2023, respectively, for termination indemnity plans in Europe.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
14. Other Expense, Net
The components of other expense, net were as follows:
Year Ended December 31,
2024 2023 2022
Deconsolidation of joint venture (1)
$ - $ - $ (2,257)
Foreign currency losses (12,001) (7,300) (1,131)
Components of net periodic benefit cost other than service cost (3,321) (6,992) (1,831)
Factoring costs (2,904) (2,226) (710)
Miscellaneous income 288 820 444
Other expense, net $ (17,938) $ (15,698) $ (5,485)
(1) Loss attributable to deconsolidation of a joint venture in the Asia Pacific region, which required adjustment to fair value.
15. Income Taxes
The components of the Company’s loss before income taxes and adjustment for noncontrolling interests were as follows:
Year Ended December 31,
2024 2023 2022
Domestic $ (131,954) $ (249,582) $ (154,779)
Foreign 30,476 55,199 (45,721)
Total $ (101,478) $ (194,383) $ (200,500)
The Company’s income tax expense consists of the following:
Year Ended December 31,
2024 2023 2022
Current:
Federal $ 1,670 $ 848 $ (2,280)
State 121 41 154
Foreign 20,327 13,857 13,764
Deferred:
Federal 1,468 (123) 74
State 31 (13) 106
Foreign (46,965) (5,677) 5,473
Total $ (23,348) $ 8,933 $ 17,291
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
A reconciliation of the U.S. statutory federal rate to the income tax provision was as follows:
Year Ended December 31,
2024 2023 2022
Tax at U.S. statutory rate $ (21,310) $ (40,820) $ (42,105)
State and local taxes (1,123) (4,122) (2,700)
Tax credits and incentives (7,838) (8,137) (8,413)
Changes in tax law, other 13 (433) (17)
U.S. tax reform/Global Intangible Low-Taxed Income ("GILTI")/foreign derived intangible income (2,537) 10,923 1,382
Effect of foreign tax rates (987) (474) (1,614)
Nonrecurring permanent items - - (2,189)
Foreign branch 788 486 279
Stock compensation (ASU 2016-09) 1,957 1,212 1,258
Non-deductible expenses 6,813 6,367 7,192
Tax reserves/audit settlements 4,087 9 3,854
Valuation allowance (2,735) 47,293 65,559
Other, net (476) (3,371) (5,195)
Income tax (benefit) expense $ (23,348) $ 8,933 $ 17,291
Effective income tax rate 23.0 % (4.6) % (8.6) %
For the year ended December 31, 2022, the Company received $54,273 in cash payments from the United States Internal Revenue Service (“IRS”) for tax refunds related to net operating loss carrybacks.
On August 16, 2022, the U.S. enacted the Inflation Reduction Action of 2022, which, among other things, implements a 15% minimum tax on financial statement income of certain large corporations, a 1% excise tax on net stock repurchases and several tax incentives to promote clean energy. The provisions were effective in the first quarter of 2023 and did not have a
significant impact on the Company’s consolidated financial statements.
Numerous countries have agreed to a statement in support of the Organization for Economic Co-operation and
Development (“OECD”) model rules that propose a global minimum tax rate of 15%, and European Union member states have
agreed to implement the global minimum tax. Certain countries, including European Union member states, have enacted or are
expected to enact legislation to be effective as early as 2024, with widespread implementation of a global minimum tax
expected by 2025. The Company has recorded the impact of the global minimum tax as currently enacted in the consolidated financials statements as of December 31, 2024. As further legislation becomes effective in countries in which the Company does business, its provision for income taxes could be impacted. The Company will continue to monitor pending legislation and implementation by individual countries and adjust its calculations accordingly.
Nonrecurring permanent item in 2022 relates to a withholding tax refund related to prior periods.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
Deferred tax assets and liabilities reflect the estimated tax effect of accumulated temporary differences between the basis of assets and liabilities for tax and financial reporting purposes, as well as net operating losses, tax credit and other carryforwards. The significant components of the Company’s deferred tax assets and liabilities as of December 31, 2024 and 2023 were as follows:
December 31, 2024 December 31, 2023
Deferred tax assets:
Pension, postretirement and other benefits $ 36,949 $ 43,627
Capitalized expenditures 50,724 42,293
Net operating loss and tax credit carryforwards 265,568 282,373
Operating lease liabilities 22,125 22,978
Interest expense carryforwards 74,799 54,442
All other items 51,825 50,740
Total deferred tax assets 501,990 496,453
Deferred tax liabilities:
Property, plant and equipment (6,276) (4,764)
Operating lease right-of-use assets (21,300) (22,018)
All other items (9,793) (12,360)
Total deferred tax liabilities (37,369) (39,142)
Valuation allowances (405,182) (438,727)
Net deferred tax assets $ 59,439 $ 18,584
As of December 31, 2024, the Company’s U.S. and foreign subsidiaries, primarily in France, Brazil, Italy and Germany, had operating loss carryforwards aggregating $534,000, with indefinite expiration periods. Other foreign subsidiaries in China, Mexico, Netherlands, Spain, Czech Republic and Korea had operating loss carryforwards aggregating $285,000, with expiration dates beginning in 2025. The Company has research tax credit carryforwards and foreign tax credit carryforwards totaling $60,000 in the U.S. with expiration dates beginning in 2029. The Company and its domestic subsidiaries have anticipated tax benefits of state net operating losses and credit carryforwards of $13,000 with expiration dates beginning in 2025.
As of December 31, 2024, the Company has consolidated deferred tax assets of $501,990 with valuation allowances of $405,182 related to tax losses, credit carryforwards, and other deferred tax assets in the U.S. and certain foreign jurisdictions. The Company’s valuation allowance decreased in 2024 primarily from valuation allowance reversals of $22,900 in Brazil, $9,100 in Poland, and $9,500 in one Chinese location offset with increases from current year losses generated in the U.S. and certain foreign jurisdictions. Current and future provision for income taxes is significantly impacted by the initial recognition of and changes in valuation allowances in certain countries. The Company intends to maintain these allowances until it is more likely than not that the deferred tax assets will be realized. In the future, provision for income taxes will include no tax benefit with respect to losses incurred and no tax expense with respect to income generated in these countries until the respective valuation allowance is eliminated.
As of December 31, 2024, no material deferred income taxes have been recorded on the undistributed earnings of foreign subsidiaries, since a majority of these earnings will not be taxable upon repatriation to the United States. These earnings will be primarily treated as previously taxed income from either the one time transition tax or GILTI, or they will be offset with a 100% dividends received deduction. The Company has not recorded a deferred tax liability for foreign withholding taxes or state income taxes that may be incurred upon repatriation in the future as such undistributed foreign earnings are considered permanently reinvested or could be remitted with no tax implications.
As of December 31, 2024, the Company had $10,640 ($10,834 including interest and penalties) of total unrecognized tax benefits, of which $7,812 represents the amount of unrecognized tax benefits that, if recognized, would impact the effective income tax rate.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
A reconciliation of the beginning and ending amount of unrecognized tax benefits was as follows:
2024 2023
Balance at beginning of period $ 6,296 $ 5,930
Tax positions related to the current period:
Gross additions 338 332
Tax positions related to prior years:
Gross additions 4,072 92
Gross reductions (66) -
Settlements - (58)
Balance at end of period $ 10,640 $ 6,296
The Company, or one of its subsidiaries, files income tax returns in the United States and other foreign jurisdictions. During the examination of our 2015 and 2016 U.S. federal income tax filings, the IRS asserted that income earned by a Netherlands subsidiary from its Mexican branch operations should be categorized as foreign based company sales income under Section 954(d) of the Internal Revenue Code and should be recognized currently as taxable income on our 2015 and 2016 U.S. federal income tax filings. As a result of this assertion, the IRS issued a Notice of Proposed Adjustment (“NOPA”). A similar NOPA has been issued for 2017 and 2018 as well. The Company believes the proposed adjustment is without merit and are in the the process of contesting the matter. As of December 31, 2024, tax years 2015-2018 remain in the IRS appeals process. The Company does not anticipate reaching a resolution with IRS Appeals, but does plan to continue to challenge these proposed adjustments in the future. The Company believes, after consultation with tax and legal counsel, that it is more likely than not that it will ultimately be successful in defending its position. As such, the Company has not recorded any impact of the IRS’s proposed adjustment in its consolidated financial statements as of and for the year ended December 31, 2024. In the event the Company is not successful in defending its position, the potential income tax expense impact, including interest, related to tax years 2015 through 2023 is less than $10 million. The Company intends to vigorously contest the conclusions reached in the NOPA through the IRS’s administrative appeals process, and, if necessary, through litigation.
The statute of limitations for U.S. state and local jurisdictions is closed for taxable years ending prior to 2015. The Company’s major foreign jurisdictions are Brazil, Canada, China, France, Germany, Italy, Mexico, and Poland. The Company is no longer subject to income tax examinations in major foreign jurisdictions for years prior to 2019.
During the next twelve months, it is reasonably possible that, as a result of audit settlements and the completion of current examinations, the Company may decrease the amount of its gross unrecognized tax benefits by approximately $7,213, all of which, if recognized, would impact the effective tax rate.
The Company classifies all income tax related interest and penalties as income tax expense. The Company has liabilities of $194 and $179 recorded as of December 31, 2024 and 2023, respectively, for tax related interest and penalties on its consolidated balance sheets.
16. Net Loss Per Share Attributable to Cooper-Standard Holdings Inc.
Basic net loss per share attributable to Cooper-Standard Holdings Inc. was computed by dividing net loss attributable to Cooper-Standard Holdings Inc. by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share attributable to Cooper-Standard Holdings Inc. was computed using the treasury stock method by dividing diluted net loss available to Cooper-Standard Holdings Inc. by the weighted average number of shares of common stock outstanding, including the dilutive effect of common stock equivalents, using the average share price during the period.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
Information used to compute basic and diluted net loss per share attributable to Cooper-Standard Holdings Inc. for the years ended December 31, 2024, 2023 and 2022 was as follows:
Year Ended December 31,
2024 2023 2022
Net loss attributable to Cooper-Standard Holdings Inc. common stockholders $ (78,746) $ (201,985) $ (215,384)
Basic weighted average shares of common stock outstanding 17,564,012 17,355,392 17,190,958
Dilutive effect of common stock equivalents - - -
Diluted weighted average shares of common stock outstanding 17,564,012 17,355,392 17,190,958
Basic net loss per share attributable to Cooper-Standard Holdings Inc. $ (4.48) $ (11.64) $ (12.53)
Diluted net loss per share attributable to Cooper-Standard Holdings Inc. $ (4.48) $ (11.64) $ (12.53)
Approximately 254,000, 91,000, and 24,000 securities were excluded from the calculation of diluted net loss per share for the years ended December 31, 2024, 2023 and 2022, respectively, because the inclusion of such securities in the calculation would have been anti-dilutive.
17. Accumulated Other Comprehensive Loss
Changes in accumulated other comprehensive loss by component, net of related tax, were as follows:
Foreign currency translation adjustment Benefit plan
liabilities Fair value change of derivatives Total
Balance as of December 31, 2022 $ (158,023) $ (60,251) $ 8,303 $ (209,971)
Other comprehensive (loss) income before reclassifications (2,602) (1)
(542) (2)
10,387 (3)
7,243
Amounts reclassified from accumulated other comprehensive income (loss) 2,969 (4)
16,644 (5)
(18,550) 1,063
Balance as of December 31, 2023 (157,656) (44,149) 140 (201,665)
Other comprehensive (loss) income before reclassifications (24,443) (1)
11,623 (2)
(8,358) (3)
(21,178)
Amounts reclassified from accumulated other comprehensive income - 45,365 (6)
4,046 (7)
49,411
Balance as of December 31, 2024 $ (182,099) $ 12,839 $ (4,172) $ (173,432)
(1)Includes other comprehensive (loss) income related to intra-entity foreign currency notes that are of a long-term investment nature of $(41,653) and $2,000 for the years ended December 31, 2024 and 2023, respectively.
(2)Net of tax (benefit) expense of $(179) and $105 for the years ended December 31, 2024 and 2023, respectively.
(3)Net of tax expense (benefit) of $128 and $(185) for the years ended December 31, 2024 and 2023, respectively.
(4)Net accumulated currency translation adjustment losses reclassified to net income related to the divestitures of our European technical rubber products business and a joint venture in the Asia Pacific region.
(5)Includes the effect of the amortization of actuarial losses of $586, net settlement losses of $16,035, and the amortization of prior service costs of $25, net of tax of $2.
(6)Includes the effect of the amortization of actuarial gains of $2,054 and amortization of prior service cost of $14, net of tax of $1,406, and the impact of a one-time, non-cash pension settlement charge of $46,342 reclassified to net earnings. See Note 12. “Pensions” for additional information.
(7)Net of tax expense of $313.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
18. Equity
Common Stock
The Company is authorized to issue up to 190,000,000 shares of Common Stock, par value $0.001 per share. As of December 31, 2024, 19,392,340 shares of its Common Stock were issued, and 17,326,531 shares were outstanding.
Holders of shares of Common Stock are entitled to one vote for each share on each matter on which holders of Common Stock are entitled to vote. Holders of Common Stock are entitled to ratably receive dividends and other distributions when, as and if declared by the Board of Directors out of assets or funds legally available therefore. The First Lien Notes, Third Lien Notes, 2026 Senior Notes, and ABL Facility each contain covenants that restrict the Company’s ability to pay dividends or make distributions on the Common Stock, subject to certain exceptions.
In the event of the liquidation, dissolution or winding up of the Company, holders of Common Stock are entitled to share ratably in the Company assets, if any, remaining after the payment of all the Company’s debts and liabilities.
Shareholder Rights Plan
On November 7, 2022, the Company’s Board of Directors adopted a Section 382 rights plan and declared a dividend of one right (a “Right”) for each outstanding share of the Company’s common stock, par value $0.001 per share (the “Common Stock”), to stockholders of record at the close of business on November 17, 2022 (“Shareholder Rights Plan”). Each Right entitles its holder, under certain circumstances described below, to purchase from the Company one one-thousandth of a share of Series A Junior Participating Preferred Stock of the Company, par value $0.001 per share (the “Series A Preferred Stock”), at an exercise price of $50.00 per Right, subject to adjustment.
If the Rights become exercisable, each Right would allow its holder to purchase from the Company one one-hundredth of a share of the Series A Preferred Stock for a purchase price of $50.00. Each fractional share of Series A Preferred Stock would give the stockholder approximately the same dividend, voting and liquidation rights as does one share of Common Stock. Prior to exercise, however, a Right does not give its holder any dividend, voting or liquidation rights. The exercisability of the Rights are described in further detail in the rights agreement.
Preferred Stock
The Company is authorized to issue up to 10,000,000 shares of preferred stock, par value $0.001 per share, of which 2,000,000 shares were designated as 7% Cumulative Participating Convertible Preferred Stock (the “7% Preferred Stock”). On November 7, 2022, the Company filed a Certificate of Elimination to its Third Amended and Restated Certificate of Incorporation (the “Certificate of Incorporation”) with the Secretary of State of the State of Delaware eliminating from the Certificate of Incorporation all matters set forth in the Certificate of Designation with respect to the Company’s 7% Preferred Stock. No shares of the 7% Preferred Stock were outstanding and none will be issued subject to the Certificate of Designation for the 7% Preferred Stock. All shares that were designated as 7% Preferred Stock have been returned to the status of authorized but unissued shares of preferred stock of the Company, without designation as to series.
On November 7, 2022, in connection with the adoption of the Shareholder Rights Plan, the Company filed a Certificate of Designation of Series A Junior Participating Preferred Stock of Cooper-Standard Holdings Inc. (the “Certificate of Designation”) to its Certificate of Incorporation with the Secretary of State of the State of Delaware, designating 2,000,000 shares of preferred stock as Series A Preferred Stock. As of December 31, 2024, no shares of Series A Preferred Stock were issued or outstanding.
Share Repurchase Program
In June 2018, the Company’s Board of Directors approved a common stock repurchase program (the “2018 Program”) authorizing the Company to repurchase, in the aggregate, up to $150,000 of its outstanding common stock. Under the 2018 Program, repurchases may be made on the open market, through private transactions, accelerated share repurchases, round lot or block transactions on the New York Stock Exchange or otherwise, as determined by management and in accordance with prevailing market conditions and federal securities laws and regulations. The Company expects to fund any future repurchases from cash on hand and future cash flows from operations. The Company is not obligated to acquire a particular amount of securities, and the 2018 Program may be discontinued at any time at the Company’s discretion. The 2018 Program was effective beginning November 2018. As of December 31, 2024, the Company had approximately $98,720 of repurchase authorization under the 2018 Program.
The Company did not make any repurchases under the 2018 Program during the years ended December 31, 2024, 2023, or 2022.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
19. Share-Based Compensation
The Company’s long-term incentive plans allow for the grant of various types of share-based awards to key employees and directors of the Company and its affiliates. The Company generally awards grants on an annual basis. There are 1,661,639 shares of common stock authorized for awards granted under the current plan. Under previous plans, a total of 5,873,103 shares were authorized for awards. The plans provide for the grant of stock options, stock appreciation rights, shares of common stock, restricted stock, restricted stock units (“RSUs”), performance-vested restricted stock units (“PUs”), incentive awards and certain other types of awards to key employees and directors of the Company and its affiliates.
The Company measures share-based compensation expense at fair value and recognizes such expense on a straight-line basis over the vesting period of the share-based employee awards. The compensation expense related to stock options, restricted stock and performance units granted to key employees and directors of the Company, which is quantified below, does not represent payments actually made to these employees. Rather, the amounts represent the non-cash compensation expense recognized by the Company in connection with these awards for financial reporting purposes. The actual value of these awards to the recipients will depend on the trading price of the Company’s stock when the awards vest. In accordance with the Company’s long-term incentive plans, share-based compensation awards that settle in shares of Company stock may be delivered on a gross settlement basis or a net settlement basis, as determined by the recipient.
Share-based compensation expense for the years ended December 31, 2024, 2023 and 2022 was as follows:
Year Ended December 31,
2024 2023 2022
PUs $ 5,190 $ 3,755 $ 248
RSUs 3,861 3,272 1,738
Stock options 110 691 1,273
Total $ 9,161 $ 7,718 $ 3,259
Stock Options
Stock option awards are granted at the fair market value of the Company’s stock price at the date of the grant and have a 10-year term. The stock option grants vest over three years from the date of grant.
Stock option transactions and related information for the year ended December 31, 2024 was as follows:
Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value
Outstanding as of January 1, 2024 683,944 $ 58.16
Expired (162,951) $ 70.01
Outstanding as of December 31, 2024 520,993 $ 54.45 3.6 $ -
Exercisable as of December 31, 2024 520,993 $ 54.45 3.4 $ -
There were no stock options granted or exercised during the years ended December 31, 2024 and 2023.
As of December 31, 2024, there was no unrecognized compensation expense for stock options.
The fair value of the stock options was estimated at the date of the grant using the Black-Scholes option pricing model. Expected volatility was based on the historical volatility of the Company’s common stock. The expected stock option life was calculated using the simplified method. The risk-free rate is based on the U.S. Treasury zero-coupon issues with a term equal to the expected stock option life on the date the stock options were granted. The fair value of each stock option was estimated using the following assumptions:
Expected volatility 48.65% - 50.50%
Dividend yield 0.00 %
Expected option life - years 6.0
Risk-free rate 0.6% - 0.9%
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
Restricted Stock and Restricted Stock Units
The fair value of the restricted stock and RSUs is determined based on the closing price of the common stock on the date of grant. The restricted stock and RSUs vest over one or three years.
Restricted stock and RSUs transactions and related information for the year ended December 31, 2024 was as follows:
Restricted Stock and Restricted Stock Units Weighted Average Grant Date Fair Value
Non-vested as of January 1, 2024 409,234 $ 23.06
Granted 255,988 $ 17.45
Vested (233,121) $ 14.83
Forfeited (6,413) $ 12.70
Non-vested as of December 31, 2024 425,688 $ 24.36
The weighted-average grant date fair value of restricted stock and RSUs granted during the years ended December 31, 2024, 2023 and 2022 was $17.45, $16.11 and $9.46, respectively. The total fair value of restricted stock and RSUs vested during the years ended December 31, 2024, 2023 and 2022 was $3,456, $1,642 and $9,153, respectively.
As of December 31, 2024, unrecognized compensation expense for restricted stock and RSUs amounted to $4,381. Such cost is expected to be recognized over a weighted-average period of approximately 1.7 years.
Performance-Vested Restricted Stock Units
The actual number of PUs that will vest depends on the Company’s achievement of target performance goals related to the Company’s ROIC and total shareholder return over a performance period, which may range from 0% to 200% of the target award amount. The PUs cliff vest at the end of their three-year performance period or vest ratably over three years after their initial two-year performance period. PUs that are expected to be settled in shares of the Company’s common stock are accounted for as equity awards, and the fair value is determined based on the closing price of the common stock on the date of grant and a contemporaneous valuation by an independent valuation specialist with respect to the total shareholder return PUs. PUs that are expected to be settled in cash are accounted for as liability awards.
A summary of activity for PUs transactions and related information for the year ended December 31, 2024 was as follows:
Stock Settled Performance Units Cash Settled Performance Units Weighted Average Grant Date Fair Value
Non-vested as of January 1, 2024 121,124 297,136 $ 15.69
Granted 317,885 97,766 $ 8.38
Forfeited - (5,698) $ 13.56
Non-vested as of December 31, 2024 439,009 389,204 $ 11.49
The weighted-average grant date fair value of PUs granted during the years ended December 31, 2024, 2023 and 2022 was $8.38, $19.54 and $9.41, respectively. There were no vestings of PUs during the year ended December 31, 2024. The total fair value of PUs vested during the years ended December 31, 2023 and 2022 was $3,328 and $10,578, respectively. Actual payout of units vested was 0% and no cash was paid to settle PUs during the years ended December 31, 2024, 2023 and 2022.
As of December 31, 2024, unrecognized compensation expense for the PUs granted in 2024 and 2023 was $2,821 and $923, respectively. Such cost is expected to be recognized over a weighted-average period of approximately 1.9 years.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
The fair value of certain PUs is estimated using a Monte Carlo simulation. Expected volatility was calculated based on historical stock price volatility over the previous year. The risk-free rate was based on the U.S. Treasury yield curve, generally represented by U.S. Treasury securities, with a term equal to the expected life of the PUs. The dividend yield was assumed to be zero based on Company’s historical patterns and future expectation. The fair value of the PUs were estimated using the following assumptions:
2024 2023 2022
Expected volatility 81.02 % 100.42 % 88.24 %
Dividend yield 0.00 % 0.00 % 0.00 %
Risk-free rate 4.97 % 4.60 % 1.71 %
20. Contingent Liabilities
Litigation and Claims
Various legal actions, proceedings, and claims (generally, “matters”) are pending or may be instituted or asserted against the Company. The Company accrues for matters when losses are deemed probable and reasonably estimable. Any resulting adjustments, which could be material, are recorded in the period the adjustments are identified. As of December 31, 2024, the Company does not believe that there is a reasonable possibility that any material loss exceeding the amounts already accrued for matters, if any, has been incurred. However, the ultimate resolutions of these matters are inherently unpredictable and could require payment substantially in excess of the amounts that have been accrued or disclosed.
Environmental
The Company is subject to a broad range of federal, state and local environmental and occupational safety and health laws and regulations in the United States and other countries, including those governing: emissions to air, discharges to water, noise and odor emissions; the generation, handling, storage, transportation, treatment, reclamation and disposal of chemicals and waste materials; the cleanup of contaminated properties; and human health and safety. The Company may incur substantial costs associated with hazardous substance contamination or exposure, including cleanup costs, fines, and civil or criminal sanctions, third party property or natural resource damage, personal injury claims or costs to upgrade or replace existing equipment as a result of violations of or liabilities under environmental laws or the failure to maintain or comply with environmental permits required at their locations. In addition, many of the Company’s current and former facilities are located on properties with long histories of industrial or commercial operations, and some of these properties have been subject to certain environmental investigations and remediation activities. The Company maintains environmental reserves for certain of these sites. As of December 31, 2024 and December 31, 2023, the Company had $9,535 and $11,354, respectively, reserved in accrued liabilities and other liabilities on the consolidated balance sheets on an undiscounted basis, which it believes are adequate. Because some environmental laws (such as the Comprehensive Environmental Response, Compensation and Liability Act and analogous state laws) can impose liability retroactively and regardless of fault on potentially responsible parties for the entire cost of cleanup at currently or formerly owned or operated facilities, as well as sites at which such parties disposed or arranged for disposal of hazardous waste, the Company could become liable for investigating or remediating contamination at their current or former properties or other properties (including offsite waste disposal locations). The Company may not always be in complete compliance with all applicable requirements of environmental laws or regulation, and the Company may receive notices of violation or become subject to enforcement actions or incur material costs or liabilities in connection with such requirements. In addition, new environmental requirements or changes to interpretations of existing requirements, or in their enforcement, could have a material adverse effect on the Company’s business, results of operations, and financial condition. The Company has made and will continue to make expenditures to comply with environmental requirements. While the Company’s costs to defend and settle known claims arising under environmental laws have not been material in the past and are not currently estimated to have a material adverse effect on the Company’s financial condition, such costs may be material to the Company’s financial statements in the future.
Brazil Indirect Tax Claim
In 2019, the Superior Judicial Court of Brazil rendered a favorable decision on a case challenging whether a certain state value-added tax should be included in the calculation of federal gross receipts taxes. The decision will allow the Company the right to recover, through offset of federal tax liabilities, amounts collected by the government. As a result of the favorable decision, the Company recorded pre-tax recoveries of $8,000 in the South America segment and in cost of products sold for the year ended December 31, 2019. As of December 31, 2024, the Company had $4,357 of pre-tax recoveries remaining. Timing on realization of these remaining recoveries is dependent upon generation of federal tax liabilities eligible for offset.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
21. Business Segments
The Company had historically managed its automotive business in four reportable segments: North America, Europe, Asia Pacific and South America. All other business activities were reported in Corporate, eliminations and other. Effective January 1, 2024, the Company changed its management reporting structure with the launch of global product line-focused business segments. This resulted in the realignment of the Company’s reportable segments, which are based on how the CODM manages the business, allocates resources, makes operating decisions, and evaluates operating performance. Based on this change, the Company established two reportable automotive segments: Sealing Systems and Fluid Handling Systems. All other business activities are reported in Corporate, eliminations and other. Additional information related to the composition of each reportable segment is included below:
•Sealing Systems: The Sealing Systems segment is comprised of products that are designed and manufactured to protect vehicle interiors from weather, dust and noise intrusion for an improved driving experience. Its products also provide aesthetic and functional class-A exterior surface treatment. The Company believes it is the largest global producer of sealing systems.
•Fluid Handling Systems: The Fluid Handling Systems segment is comprised of products that help convey, connect, control and communicate throughout fluid systems for superior performance across diverse powertrains. The Company leverages its innovation expertise and vertically integrated manufacturing process with strong global standardization to support customers throughout the world.
The new structure is expected to optimize asset and resource allocation, enhance operating efficiency and aid in accelerating growth. The segment realignment had no impact on the Company’s consolidated financial position, results of operations, or cash flows. All segment information is reflective of this new structure, and prior period information has been revised to conform to the Company’s current period presentation.
The Company’s CODM, the Chairman and Chief Executive Officer, uses segment adjusted EBITDA as the measure of earnings to evaluate the performance of each segment and to allocate resources, including employees, property, plant and equipment, as well as financial and capital resources. The CODM regularly reviews budget-to-actual variances on a monthly basis for segment adjusted EBITDA to assess performance and make resource allocation decisions. The results of each segment include certain allocations for general, administrative and other shared costs. Segment adjusted EBITDA as used by the Company may not be directly comparable to similarly titled measures reported by other companies.
The measure of segment assets used by the CODM to evaluate segment performance and allocate resources is reported as total assets on the consolidated balance sheets. While inventory and tooling balances by segment are regularly provided to the CODM, this information is not used as a basis for assessing segment performance or determining resource allocation decisions.
The accounting policies of the Company’s segments are consistent with those described in Note 2. “Basis of Presentation and Summary of Significant Accounting Policies.”
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
Certain financial information on the Company’s reportable segments was as follows:
Year Ended December 31,
2024 2023 2022
Capital expenditures
Sealing Systems $ 24,429 $ 44,512 $ 34,663
Fluid Handling Systems 23,815 34,033 31,580
Total for reportable segments $ 48,244 $ 78,545 $ 66,243
Corporate, eliminations and other 2,254 2,198 4,907
Consolidated $ 50,498 $ 80,743 $ 71,150
December 31, 2024 December 31, 2023
Segment assets
Sealing Systems $ 817,581 $ 906,022
Fluid Handling Systems 667,920 735,465
Total for reportable segments $ 1,485,501 $ 1,641,487
Corporate, eliminations and other 247,564 230,812
Consolidated $ 1,733,065 $ 1,872,299
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
Year Ended December 31, 2024 Year Ended December 31, 2023 Year Ended December 31, 2022
Sealing Systems Fluid Handling Systems Total Sealing Systems Fluid Handling Systems Total Sealing Systems Fluid Handling Systems Total
Gross reportable segment sales $ 1,465,790 $ 1,261,121 $ 1,499,795 $ 1,290,993 $ 1,325,801 $ 1,136,002
Intersegment sales 45,756 24,284 55,298 26,040 51,101 26,581
Total reportable segment sales $ 1,420,034 $ 1,236,837 $ 2,656,871 $ 1,444,497 $ 1,264,953 $ 2,709,450 $ 1,274,700 $ 1,109,421 $ 2,384,121
Reconciliation of segment sales
Corporate, eliminations and other 74,022 106,429 141,270
Total consolidated sales $ 2,730,893 $ 2,815,879 $ 2,525,391
Cost of products sold 1,249,521 1,110,904 1,270,906 1,138,354 1,199,528 1,046,253
Other segment items (a) 43,989 48,247 59,346 51,817 45,308 54,736
Total reportable segment adjusted EBITDA $ 126,524 $ 77,686 $ 204,210 $ 114,245 $ 74,782 $ 189,027 $ 29,864 $ 8,432 $ 38,296
Reconciliation of adjusted EBITDA
Corporate, eliminations and other (23,521) (21,951) (428)
Total consolidated adjusted EBITDA $ 180,689 $ 167,076 $ 37,868
Restructuring charges 16,144 2,841 23,601 8,802 6,663 18,018 8,594 4,069 18,304
Deconsolidation of joint venture - - 2,257
Impairment charges 713 4,768 43,710
Gain on sale of businesses, net (1,971) (586) -
Gain on sale of buildings and land, net (3,317) - (33,391)
Indirect tax adjustments - - 1,409
Loss on refinancing and extinguishment of debt - 81,885 -
Pension settlement and curtailment charges 44,553 16,035 2,682
EBITDA $ 117,110 $ 46,956 $ 2,897
Depreciation and amortization 51,415 37,826 103,565 53,828 37,752 109,931 61,527 37,797 122,476
Interest expense, net of interest income 115,639 130,077 78,514
Income tax (benefit) expense (23,348) 8,933 17,291
Total consolidated net loss $ (78,746) $ (201,985) $ (215,384)
(a) Other segment items include other income and expenses and other non-comparable items to derive at total reportable segment adjusted EBITDA.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Dollar amounts in thousands except per share and share amounts)
Geographic Information
Geographic information for revenues, based on country of origin, and property, plant and equipment, net, was as follows:
Year Ended December 31,
2024 2023 2022
Revenues
Mexico $ 841,723 $ 774,357 $ 696,755
United States 602,623 616,883 589,801
China 305,262 354,492 354,741
Poland 226,603 226,254 166,114
Canada 157,437 168,738 144,890
Germany 58,791 112,686 116,153
France 88,566 98,915 90,711
Brazil 126,082 125,629 100,420
Other 323,806 337,925 265,806
Consolidated $ 2,730,893 $ 2,815,879 $ 2,525,391
December 31,
2024 2023
Property, plant and equipment, net
Mexico $ 122,019 $ 134,442
United States 115,203 124,240
China 100,179 118,306
Poland 39,580 44,535
Germany 24,067 27,945
Canada 23,161 27,375
France 15,589 18,161
Brazil 19,701 27,181
Other 79,702 86,246
Consolidated $ 539,201 $ 608,431
Customer Concentration
Sales to customers of the Company which contributed 10% or more of its total consolidated sales and the related percentage of consolidated Company sales for 2024, 2023 and 2022 was as follows:
% of Net Sales 2023
% of Net Sales 2022
% of Net Sales
Customer
Ford 27 % 25 % 25 %
General Motors 19 % 17 % 19 %
Stellantis 10 % 13 % 14 %
SCHEDULE II
Valuation and Qualifying Accounts
(Dollars amounts in millions)
Description Balance at beginning of period Charged to Expenses Charged (credited) to other accounts (1)
Deductions (2)
Balance at end of period
Allowance for credit losses:
Year ended December 31, 2024 $ 5.9 1.5 1.1 (3.1) $ 5.4
Year ended December 31, 2023 $ 17.2 1.9 (12.4) (0.8) $ 5.9
Year ended December 31, 2022 $ 20.3 (0.2) (2.1) (0.8) $ 17.2
(1) Primarily usage of a previously recorded allowance for credit loss resulting from the bankruptcy proceedings of a divested joint venture for the year ended December 31, 2023, and foreign currency translation for the years ended December 31, 2022.
(2) Includes impact of divestitures.
Description Balance at beginning of period Additions Balance at end of period
Charged to Income Charged to Equity (3)
Deductions
Tax valuation allowance:
Year ended December 31, 2024 $ 438.7 38.8 (4)
(30.8) (41.5) (4)
$ 405.2
Year ended December 31, 2023 $ 384.8 47.3 (5)
6.6 - $ 438.7
Year ended December 31, 2022 $ 335.0 65.6 (6)
(15.8) - $ 384.8
(3) Includes foreign currency translation.
(4) Primarily related to valuation reversals of $41.5 million in Brazil, Poland, and a Chinese location offset with 2024 losses with no benefits in the U.S. and certain foreign jurisdictions.
(5) Primarily related to 2023 losses with no benefit in the U.S. and certain foreign jurisdictions.
(6) Primarily related to 2022 losses with no benefit in the U.S. and certain foreign jurisdictions in addition to new valuation allowance in Poland.

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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
Not applicable.

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ITEM 9A. CONTROLS AND PROCEDURES
Item 9A. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
The Company has evaluated, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, the effectiveness of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of December 31, 2024. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. However, based on that evaluation, the Company’s Chief Executive Officer along with the Chief Financial Officer have concluded that the Company’s disclosure controls and procedures were effective at a reasonable assurance level as of December 31, 2024.
Management’s Report on Internal Control over Financial Reporting
The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, the Company conducted an evaluation of the effectiveness of internal control over financial reporting based on the framework in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013. Based on the evaluation under the framework in Internal Control-Integrated Framework, management concluded that the Company’s internal control over financial reporting was effective as of December 31, 2024.
The attestation report of the Company’s independent registered public accounting firm regarding internal control over financial reporting is set forth in Item 8. “Financial Statements and Supplementary Data” of this Report under the caption “Report of Independent Registered Public Accounting Firm on Internal Control over Financial Reporting” and incorporated herein by reference.
Changes in Internal Control over Financial Reporting
There was no change in the Company’s internal control over financial reporting that occurred during the fourth quarter ended December 31, 2024 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

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ITEM 9B. OTHER INFORMATION
Item 9B. Other Information
Rule 10b5-1 Trading Arrangements
During the three months ended December 31, 2024, none of the Company's directors or officers (as defined in Rule 16a-1(f) of the Securities Exchange Act of 1934, as amended), adopted, terminated or modified a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement (as such terms are defined in Item 408 of Regulation S-K of the Securities Act of 1933, as amended).

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ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Item 10. Directors, Executive Officers and Corporate Governance
Directors and Executive Officers
The information required by Item 10 regarding the Company’s directors is incorporated by reference from the information under the headings “Proposals - Proposal 1: Election of Directors” in the Company’s definitive Proxy Statement for its 2025 Annual Meeting of Stockholders (the “2025 Proxy Statement”). The information required by Item 10 regarding the Company’s executive officers is incorporated by reference from the information under the headings “Corporate Governance, Board and Committee Matters - Executive Officers” in the 2025 Proxy Statement.
Audit Committee
The information required by Item 10 regarding the Audit Committee, including the identification of the Audit Committee members and the “audit committee financial expert,” is incorporated by reference from the information in the 2025 Proxy Statement under the heading “Corporate Governance, Board and Committee Matters - Board Committees and Their Functions - Audit Committee.”
Compliance with Section 16(a) of The Exchange Act
The information required by Item 10 regarding compliance with Section 16(a) of the Exchange Act, if any, is incorporated by reference from the information in the 2025 Proxy Statement under the heading “Corporate Governance, Board and Committee Matters - Delinquent Section 16(a) Reports.”
Code of Conduct
The information required by Item 10 regarding our code of ethics is incorporated by reference from the information in the 2025 Proxy Statement. The Company’s Code of Conduct applies to all of the Company’s officers, directors and employees and is available on the Company’s website at www.cooperstandard.com. To access the Code of Conduct, first click on “Investors” and then click on “Corporate Governance.”

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ITEM 11. EXECUTIVE COMPENSATION
Item 11. Executive Compensation
The information required by Item 11 is incorporated by reference to our 2025 Proxy Statement.

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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The information required by Item 12 is incorporated by reference to our 2025 Proxy Statement.

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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Item 13. Certain Relationships and Related Transactions, and Director Independence
The information required by Item 13 is incorporated by reference to our 2025 Proxy Statement.

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ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
Item 14. Principal Accounting Fees and Services
The information required by Item 14 is incorporated by reference to our 2025 Proxy Statement.
PART IV

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ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
Item 15. Exhibits and Financial Statement Schedules
(a) Documents Filed as Part of this Annual Report on Form 10-K:
10-K
Report
Page(s)
1. Financial Statements
Report of Ernst & Young LLP, Independent Registered Public Accounting Firm 41
Report of Ernst & Young LLP, Independent Registered Public Accounting Firm, Internal Control over Financial Reporting 43
Consolidated statements of operations for the years ended December 31, 2024, 2023 and 2022
Consolidated statements of comprehensive income (loss) for the years ended December 31, 2024, 2023 and 2022 45
Consolidated balance sheets as of December 31, 2024 and December 31, 2023 46
Consolidated statements of changes in equity for the years ended December 31, 2024, 2023 and 2022 47
Consolidated statements of cash flows for the years ended December 31, 2024, 2023 and 2022 48
Notes to consolidated financial statements 49
2. Financial Statement Schedules
Schedule II-Valuation and Qualifying Accounts 84
All other financial statement schedules are not required under the related instructions or are inapplicable and therefore have been omitted.
3. Exhibits listed on the “Index to Exhibits”
Index to Exhibits
Unless otherwise provided, the SEC File Number under which each document incorporated by reference herein was filed is 001-36127.
Exhibit No. Description of Exhibit
2.1* Debtors’ Second Amended Joint Chapter 11 Plan of Reorganization, dated March 26, 2010 (incorporated by reference to Exhibit 2.1 to Cooper-Standard Holdings Inc.’s Current Report on Form 8-K filed May 24, 2010 (File No. 333-123708)).
3.1* Third Amended and Restated Certificate of Incorporation of Cooper-Standard Holdings Inc., dated May 27, 2010 (incorporated by reference to Exhibit 3.1 to Cooper-Standard Holdings Inc.’s Registration Statement on Form S-1 (File No. 333-168316)).
3.2* Amended and Restated Bylaws of Cooper-Standard Holdings Inc, as Amended and Restated Effective May 7, 2024 (incorporated by reference to Exhibit 3.1 to Cooper-Standard Holdings Inc.'s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2024).
3.3* Cooper-Standard Holdings Inc. Certificate of Designations 7% Cumulative Participating Convertible Preferred Stock (incorporated by reference to Exhibit 3.3 to Cooper-Standard Holdings Inc.’s Registration Statement on Form S-1 (File No. 333-168316)).
3.4* Certificate of Designation of Series A Junior Participating Preferred Stock of Cooper-Standard Holdings Inc. filed with the Secretary of State of the State of Delaware on November 7, 2022 (incorporated by reference to Exhibit 3.1 to Cooper-Standard Holdings Inc.’s Registration of Securities on Form 8-A filed November 7, 2022 (File No. 000-54305)).
3.5* Certificate of Elimination of 7% Cumulative Participating Convertible Preferred Stock of Cooper-Standard Holdings Inc., filed with the Secretary of State of the State of Delaware on November 7, 2022 (incorporated by reference to Exhibit 3.1 to Cooper-Standard Holdings Inc.’s Current Report on Form 8-K filed November 7, 2022.
4.1* Registration Rights Agreement, dated as of May 27, 2010, by and among Cooper-Standard Holdings Inc., the Backstop Purchasers and the other holders party thereto (incorporated by reference to Exhibit 4.3 to Cooper-Standard Holdings Inc.’s Current Report on Form 8-K filed June 3, 2010 (File No. 333-123708)).
4.2* Indenture, dated as of November 2, 2016, by and among Cooper-Standard Automotive Inc., the guarantors party thereto and U.S. Bank National Association (incorporated by reference to Exhibit 4.1 to Cooper-Standard Holdings Inc.’s Current Report on Form 8-K filed November 7, 2016).
4.3* Description of Securities (incorporated by reference to Exhibit 4.3 to Cooper-Standard Holdings Inc.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022).
4.4* Indenture, dated as of May 29, 2020, by and among Cooper-Standard Automotive Inc., the Guarantors party thereto and U.S. Bank National Association, as Trustee and Collateral Agent (incorporated by reference to Exhibit 4.1 to Cooper-Standard Holdings Inc.'s Current Report on Form 8-K filed June 1, 2020 (File No. 001-36127)).
4.5* Section 382 Rights Agreement, dated as of November 7, 2022, by and between Cooper-Standard Holdings Inc. and Broadridge Corporate Issuer Solutions, Inc., which includes the Form of Certificate of Designation as Exhibit A, Form of Rights Certificate as Exhibit B, and the Form of Summary of Rights as Exhibit C (incorporated by reference to Exhibit 4.1 to Cooper-Standard Holdings Inc.’s Registration of Securities on Form 8-A filed November 7, 2022 (File No. 000-54305)).
Exhibit No. Description of Exhibit
4.6* First Supplemental Indenture, dated as of January 20, 2023, by and among Cooper-Standard Automotive Inc., the guarantors party thereto and U.S. Bank Trust Company, National Association, as trustee, relating to the 5.625% Senior Notes due 2026 (incorporated by reference to Exhibit 4.1 to Cooper-Standard Holdings Inc.’s Current Report on Form 8-K filed January 23, 2023).
4.7* Indenture, dated as of January 27, 2023, by and among Cooper-Standard Automotive Inc., as issuer, the Guarantors party thereto and U.S. Bank Trust Company, National Association, as trustee and collateral agent, relating to 13.50% Cash Pay / PIK Toggle Senior Secured First Lien Notes due 2027 (incorporated by reference to Exhibit 4.1 to Cooper-Standard Holdings Inc.’s Current Report on Form 8-K filed January 30, 2023).
4.8* Indenture, dated as of January 27, 2023, by and among Cooper-Standard Automotive Inc., as issuer, the Guarantors party thereto and U.S. Bank Trust Company, National Association, as trustee and collateral agent, relating to 5.625% Cash Pay / 10.625% PIK Toggle Senior Secured Third Lien Notes due 2027 (incorporated by reference to Exhibit 4.2 to Cooper-Standard Holdings Inc.’s Current Report on Form 8-K filed January 30, 2023).
10.1* Third Amended and Restated Loan Agreement, dated as of November 2, 2016, among Cooper-Standard Automotive Inc., Cooper-Standard Automotive Canada Limited, Cooper-Standard Automotive International Holdings B.V., and certain subsidiaries of Cooper-Standard Automotive Inc., as guarantors, CS Intermediate HoldCo 1 LLC, as Holdings, the lenders party thereto and Bank of America, N.A. as agent for such lenders (incorporated by reference to Exhibit 10.1 to Cooper-Standard Holdings Inc.’s Current Report on Form 8-K filed November 7, 2016).
10.2* Credit Agreement, dated as of April 4, 2014, among CS Intermediate HoldCo 2 LLC, CS Intermediate HoldCo 1 LLC, Deutsche Bank AG New York Branch, as administrative agent and collateral agent, and the other lenders party thereto (incorporated by reference to Exhibit 10.1 to Cooper-Standard Holdings Inc.’s Current Report on Form 8-K filed April 8, 2014).
10.3* Amendment No. 1, dated as of November 2, 2016, to the Term Loan Credit Agreement, among Cooper-Standard Automotive Inc., as the borrower, certain subsidiaries of Cooper-Standard Automotive Inc., as guarantors, CS Intermediate HoldCo 1 LLC, as Holdings, Deutsche Bank AG New York Branch, as Administrative Agent and Collateral Agent and other lenders party thereto (incorporated by reference to Exhibit 10.2 to Cooper-Standard Holdings Inc.’s Current Report on Form 8-K filed November 7, 2016).
10.4* Amendment No. 2, dated as of May 2, 2017 to the Term Loan Credit Agreement, among Cooper-Standard Automotive Inc., as the borrower, certain subsidiaries of Cooper-Standard Automotive Inc., as guarantors, CS Intermediate Holdco 1 LL, as Holdings, Deutsche Bank AG New York Branch, as Administrative Agent and Collateral Agent and the other lenders party thereto (incorporated by reference to Exhibit 10.2 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2017).
10.5* Amendment No. 3, dated as of March 6, 2018 to the Term Loan Credit Agreement, among Cooper-Standard Automotive Inc., as the borrower, certain subsidiaries of Cooper-Standard Automotive Inc., as guarantors, CS Intermediate Holdco 1 LL, as Holdings, Deutsche Bank AG New York Branch, as Administrative Agent and Collateral Agent and the other lenders party thereto (incorporated by reference to Exhibit 10.1 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2018).
10.6* Amendment No. 1, dated as of March 24, 2020, to the Third Amended and Restated Loan Agreement and Limited Waiver by and among CS Intermediate Holdco 1 LLC, Cooper-Standard Automotive Inc., Cooper-Standard Automotive Canada Limited, Cooper-Standard Automotive International Holdings B.V., certain subsidiaries of Cooper-Standard Automotive Inc., the lenders party thereto and Bank of America, N.A. as agent for such lenders (incorporated by reference to Exhibit 10.4 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2020).
Exhibit No. Description of Exhibit
10.7* Amendment No. 2, dated as of May 18, 2020, to the Third Amended and Restated Loan Agreement by and among Cooper-Standard Automotive Inc., as loan party agent, and Bank of America, N.A. as agent for such lenders (incorporated by reference to Exhibit 10.1 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2020).
10.8* Transaction Support Agreement, dated as of November 15, 2022, among CSA, Parent, Holdings, the other Credit Parties and the Consenting Noteholders (incorporated by reference to Exhibit 10.1 to Cooper-Standard Holdings Inc.’s Current Report on Form 8-K filed November 15, 2022).
10.9* Backstop Agreement, dated as of December 19, 2022, among Cooper-Standard Automotive Inc., J.P. Morgan Investment Management Inc. and Millstreet Capital Management LLC (incorporated by reference to Exhibit 10.1 to Cooper-Standard Holdings Inc.’s Current Report on Form 8-K filed December 20, 2022).
10.10* Third Amendment, dated as of December 19, 2022, to the Third Amended and Restated Loan Agreement, among CS Intermediate Holdco 1 LLC, Cooper-Standard Automotive Inc., Cooper-Standard Automotive Canada Limited, Cooper-Standard Automotive International Holdings B.V., certain subsidiaries of Cooper-Standard Automotive Inc., the lenders party thereto and Bank of America, N.A. as agent for such lenders (incorporated by reference to Exhibit 10.2 to Cooper-Standard Holdings Inc.’s Current Report on Form 8-K filed December 20, 2022).
10.11* Amendment No. 4 dated May 6, 2024, to the Third Amended and Restated Loan Agreement by and among Cooper-Standard Automotive Inc. and Cooper-Standard Automotive Canada Limited, together as Borrowers, CS Intermediate HoldCo 1 LLC, certain financial institutions, as Lenders, and Bank of America, N.A., as agent to the Lenders (incorporated by reference to Exhibit 10.1 to Cooper-Standard Holdings Inc.'s Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2024).
10.12* Amendment No. 1 to the Transaction Support Agreement, dated as of December 15, 2022, among Cooper-Standard Holdings Inc., Cooper-Standard Automotive Inc., CS Intermediate Holdco 1 LLC, certain other direct or indirect subsidiaries of Cooper-Standard Holdings Inc., J.P. Morgan Investment Management Inc. and Millstreet Capital Management LLC (incorporated by reference to Exhibit 10.3 to Cooper-Standard Holdings Inc.’s Current Report on Form 8-K filed December 20, 2022).
10.13*† Cooper-Standard Automotive Inc. Deferred Compensation Plan, effective January 1, 2005 with Amendments through December 31, 2008 (incorporated by reference to Exhibit 10.33 to Cooper-Standard Holdings Inc.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008).
10.14*† Cooper-Standard Automotive Inc. Supplemental Executive Retirement Plan, effective January 1, 2011 (incorporated by reference to Exhibit 10.10 to Cooper-Standard Holdings Inc.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2010).
10.15*† Amended and Restated 2011 Cooper-Standard Holdings Inc. Omnibus Incentive Plan (incorporated by reference to Exhibit 10.12 to Cooper-Standard Holdings Inc.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013).
10.16*† Amended and Restated Cooper-Standard Holdings Inc. 2011 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.1 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2017).
10.17*† Letter Agreement between Jeffrey S. Edwards, Cooper-Standard Holdings Inc., Cooper-Standard Automotive Inc. dated October 1, 2012 (incorporated by reference to Exhibit 10.2 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2012).
Exhibit No. Description of Exhibit
10.18*† Form of Cooper-Standard Holdings Inc. 2011 Omnibus Incentive Plan Nonqualified Stock Option Agreement (incorporated by reference to Exhibit 10.38 to Cooper-Standard Holdings Inc.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014).
10.19*† Offer Letter between Jonathan P. Banas and Cooper-Standard Automotive Inc. dated August 17, 2015 (incorporated by reference to Exhibit 10.1 to Cooper-Standard Holdings Inc.’s Current Report on Form 8-K filed on August 28, 2015).
10.20*† Form of Cooper-Standard Holdings Inc. 2011 Omnibus Incentive Plan Restricted Stock Unit Award Agreement (Non-Employee Directors) (incorporated by reference to Exhibit 10.1 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2015).
10.21*† Form of Cooper-Standard Holdings Inc. Amended and Restated Indemnification Agreement for officers and directors (incorporated by reference to Exhibit 10.36 to Cooper-Standard Holdings Inc.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018).
10.22*† Cooper-Standard Holdings Inc. 2017 Omnibus Incentive Plan (incorporated by reference to Exhibit 10.36 to Cooper-Standard Holdings Inc.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019).
10.23*† Form of Cooper-Standard Holdings Inc. 2017 Omnibus Incentive Plan Restricted Stock Unit Award Agreement (incorporated by reference to Exhibit 10.4 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2017).
10.24*† Form of Cooper-Standard Holdings Inc. 2017 Omnibus Incentive Plan Nonqualified Stock Option Award Agreement (incorporated by reference to Exhibit 10.5 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2017).
10.25*† Form of Cooper-Standard Holdings Inc. 2017 Omnibus Incentive Plan Restricted Stock Unit Award Agreement (Non-Employee Directors) (incorporated by reference to Exhibit 10.42 to Cooper-Standard Holdings Inc.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019).
10.26*† Form of 2018 Cooper-Standard Holdings Inc. 2017 Omnibus Incentive Plan Nonqualified Stock Option Agreement. (incorporated by reference to Exhibit 10.2 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2018).
10.27*† Form of 2019 Cooper-Standard Holdings Inc. 2017 Omnibus Incentive Plan Nonqualified Stock Option Agreement (incorporated by reference to Exhibit 10.1 to Cooper-Standard Holdings Inc. Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2019).
10.28*† Form of 2020 Cooper-Standard Holdings Inc. 2017 Omnibus Incentive Plan Nonqualified Stock Option Agreement (incorporated by reference to Exhibit 10.1 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2020).
10.29*† Form of 2020 Cooper-Standard Holdings Inc. 2017 Omnibus Incentive Plan Performance Unit Award Agreement (cash-settled award) (incorporated by reference to Exhibit 10.2 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2020).
10.30*† Form of 2020 Cooper-Standard Holdings Inc. 2017 Omnibus Incentive Plan Restricted Stock Unit Award Agreement (cash-settled award) (incorporated by reference to Exhibit 10.3 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2020).
Exhibit No. Description of Exhibit
10.31*† Form of 2021 Cooper-Standard Holdings Inc. 2017 Omnibus Incentive Plan Nonqualified Stock Option Agreement (incorporated by reference to Exhibit 10.1 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2021).
10.32*† Form of 2021 Cooper-Standard Holdings Inc. 2017 Omnibus Incentive Plan Performance Unit Award Agreement (cash-settled award) (incorporated by reference to Exhibit 10.2 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2021).
10.33*† Form of 2021 Cooper-Standard Holdings Inc. 2017 Omnibus Incentive Plan Restricted Stock Unit Award Agreement (cash or stock-settled award) (incorporated by reference to Exhibit 10.3 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2021).
10.34*† Cooper-Standard Holdings Inc. 2021 Omnibus Incentive Plan (incorporated by reference to Exhibit 4.4 to Cooper-Standard Holdings Inc.’s Post-Effective Amendment No. 1 to Form S-8 filed on Form S-8POS on May 20, 2021).
10.35*† Cooper-Standard Automotive Inc. Executive Severance Pay Plan, Amended and Restated as of June 9, 2021 (incorporated by reference to Exhibit 10.2 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2021).
10.36*† Cooper-Standard Automotive Inc. Annual Incentive Plan Amended and Restated effective as of January 1, 2021(incorporated by reference to Exhibit 10.3 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2021).
10.37*† Form of 2021 Cooper-Standard Holdings Inc. 2021 Omnibus Incentive Plan Nonqualified Stock Option Agreement (incorporated by reference to Exhibit 10.1 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2021).
10.38*† Form of 2021 Cooper-Standard Holdings Inc. 2021 Omnibus Incentive Plan Restricted Stock Unit Award Agreement (cash or stock-settled award) (incorporated by reference to Exhibit 10.2 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2021).
10.39*† Form of 2022 Cooper-Standard Holdings Inc. 2021 Omnibus Incentive Plan Performance Award Agreement (ROIC) (incorporated by reference to Exhibit 10.1 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2022).
10.40*† Form of 2022 Cooper-Standard Holdings Inc. 2021 Omnibus Incentive Plan Performance Award Agreement (TSR) (incorporated by reference to Exhibit 10.2 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2022).
10.41*† Form of 2022 Cooper-Standard Holdings Inc. 2021 Omnibus Incentive Plan Restricted Stock Unit Award Agreement (cash or stock-settled award) (incorporated by reference to Exhibit 10.3 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2022).
10.42*† Form of 2022 Cooper-Standard Holdings Inc. 2021 Omnibus Incentive Plan Restricted Stock Unit Award Agreement (cash or stock-settled award) (interim awards) (incorporated by reference to Exhibit 10.1 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2022).
Exhibit No. Description of Exhibit
10.43*† Form of 2023 Cooper-Standard Holdings Inc. 2021 Omnibus Incentive Plan Performance Award Agreement (ROIC) (cash settled) (incorporated by reference to Exhibit 10.1 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2023).
10.44*† Form of 2023 Cooper-Standard Holdings Inc. 2021 Omnibus Incentive Plan Performance Award Agreement (TSR) (cash settled) (incorporated by reference to Exhibit 10.2 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2023).
10.45*† Form of 2023-2024 Cooper-Standard Holdings Inc. 2021 Omnibus Incentive Plan Restricted Stock Unit Award Agreement (stock-settled award) (incorporated by reference to Exhibit 10.3 to Cooper-Standard Holdings Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2023).
10.46*† The Cooper-Standard Holdings Inc. 2021 Omnibus Incentive Plan, as amended and restated effective May 18, 2023 (incorporated by reference to Exhibit 10.1 to Cooper-Standard Holdings Inc.’s Registration Statement filed on Form S-8 on May 18, 2023).
10.47**† Form of 2024 Cooper-Standard Holdings Inc. Amended and Restated 2021 Omnibus Incentive Plan Performance Award Agreement (FCF) (cash or stock settled).
19.1** Cooper-Standard Holdings Inc. Securities Trading Policy as amended through May 30, 2024.
21.1** List of Subsidiaries of Cooper-Standard Holdings Inc.
23.1** Consent of Independent Registered Public Accounting Firm.
31.1** Certification of Principal Executive Officer Pursuant to Exchange Act Rule 13a-14(a)/15d-14(a) (Section 302 of the Sarbanes-Oxley Act of 2002).
31.2** Certification of Principal Financial Officer Pursuant to Exchange Act Rule 13a-14(a)/15d-14(a) (Section 302 of the Sarbanes-Oxley Act of 2002).
32*** Certification Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
97.1* Cooper-Standard Holdings Inc. Incentive Compensation Clawback Policy (incorporated by reference to Exhibit 97.1 to Cooper-Standard Holdings Inc.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024).
101.SCH**** Inline XBRL Taxonomy Extension Schema Document
101.CAL**** Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF**** Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB**** Inline XBRL Taxonomy Label Linkbase Document
101.PRE**** Inline XBRL Taxonomy Extension Presentation Linkbase Document
Exhibit No. Description of Exhibit
104**** Cover Page Interactive Data File, formatted in Inline XBRL
* Incorporated by reference as an exhibit to this Report.
** Filed with this Report.
*** Furnished with this Report.
**** Submitted electronically with this Report in accordance with the provisions of Regulation S-T.
† Management contract or compensatory plan or arrangement.
The agreements and other documents filed as exhibits to this report are not intended to provide factual information or other disclosure other than with respect to the terms of the agreements or other documents themselves, and you should not rely on them for that purpose. In particular, any representations and warranties made by us in these agreements or other documents were made solely within the specific context of the relevant agreement or document and may not describe the actual state of affairs as of the date they were made or at any other time.